Balancing Government Expenditure

The new mantra spouted by politicians is ‘we have to make difficult decisions’, the use of the term ‘difficult decisions’ is nothing more than PR speak and has already worn thin, it is a way that Politicians can act as though this is something being foisted on them, over which they have no control and if only they could, they would spend unlimited amounts of money on everything.

The fact is that expenditure in the UK is higher than income and this is always a distinct possibility as potential demands for expenditure will always exceed income. These so called ‘difficult decisions’ are being taken all the time. The British people are not idiots and are well aware that cuts need to be made.

For many years the, spend now – pay later culture has pervaded both in personal households and also by Government. The abrupt collapse in the financial system has brought this failure to balance the books to the fore.

To argue about what should have been done and how to get out of this mess are a separate debate and should not be confused with the essential aspect. Finances in the UK are limited and should be spent more efficiently and in a more targeted manner.

On a personal level, individuals are reluctant to see taxes rise and a governmental level; politicians are reluctant to cut spending, so we have an imbalance.

The discussion needs to centre around what drives people to be so self focussed when it comes to their taxes, but so socially conscious when it comes to government expenditure. Efficiencies should be made across Government Departments and public sector expenditure. I am sure many people in the UK can identify examples of wasted money, be it in grandiose buildings, PFI inefficiencies, Quangos, etc. but these are issues tinkering around the edges.

The discussion needs to focus on the core expenditure of this country.

The NHS eats vast chunks of money in all sorts of programmes. We perhaps need to revise our expectations about the NHS, what is it and what is it not.

There is a debate to open as to whether the NHS should be spending money on treatments such as IVF, Cosmetic Surgery, and leading edge research. Should the NHS provide palliative care, or only treatments? Should parts of the NHS treatment process become means tested. Is the NHS responsible for treatment of those with self imposed conditions, such as drinkers, the obese, smokers etc?

It is ridiculous for the users of the NHS to demand ever increasing ranges of treatment, yet at the same time expect to pay ever decreasing taxes.

The Defence budget is another huge expenditure area. The UK continues to seek to play a role as a major world power, on a budget which doesn’t cover the costs. Should we be seeking to have a Military which is able to respond to conflict around the world, or should we scale back to become a defence of the country? Should the UK seek to remain a nuclear force, or should it move away from this?

Having a world class fighting force, requires money, can the country afford it and should we strive to have a military which is able to respond in a meaningful way to world conflicts.

The education system is another area with a large budget. What are the aims of our education system and why. Do we need larger schools, do we need more schools? Should children be made to stay in state funded education until the age of 18? Should University education be funded by the tax payer, or the student?

Looking at climate change, how should the country focus on the issue? Should it even focus on the issue? Should fossil fuels be taxed at a higher rate and the money invested in alternative sources of energy or should alternative energy research and development be funded through indirect taxes. Is there any need to focus on alternative energy? Should people be incentivised to become ‘greener’, or penalised for not becoming ‘greener’? Should any money needed to be spent on the issue of climate change or is this a choice individuals should be making?

There are other big areas of expenditure, this is only a short list and not necessarily the most important, until the ‘sacrosanct’ are identified, trying to balance budgets is nothing more than hot air. Not only do Politicians need to look at this issue, but individuals must accept their own financial responsibility in the process. Demanding more services yet throwing hands up in horror at the idea of higher taxes is a ridiculous starting point.

This country needs to limit expenditure and individuals needs to consider whether the reluctance of people and business to pay higher taxes, means we are absolving Public Services from the responsibility for providing services.

The discussion needs to be open and those with free market attitudes who would prefer to head towards a system of limited centrally provided services, need to be honest with themselves, about the reality of that type of society. Those who would prefer a system in which all services are freely available to all and provided centrally again need to step up to the plate and accept the reality of their position.

Burying heads in the sand and expecting the state to provide all to everyone for free at point of delivery yet refusing to pay for it is a road to nowhere and in reality is unachievable. There is limited income and therefore there has to be limited expenditure. The questions are what money should be spent on and how much are we prepared to pay, at that point budgets can actually be balanced.

Politicians have a role in this debate by being honest about cost implications; people have a responsibility to accept their role in funding those costs.

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