But the problem isn’t just the 2020 low point along with a hefty budget surplus that George Osborne wants to get to. It’s also the mid-point in the next Parliament which is the timing both Conservatives and Liberal Democrats are looking to for clearing the deficit. That too is at historically extremely low levels.
The conclusion? The Liberal Democrats need a manifesto which isn’t only about finding the least painful areas of government spending to curb, the party also needs a manifesto that includes plans for sufficient tax increases both to help clearing the deficit and to avoid having to cut spending to such implausibly low levels.
Finding tax rises which are both significant in scale and not politically horrendously toxic will be no easy matter but this time around there is much more scope than in 2010** for political benefit from being the party that is clearest about the financial policies required after the election.
* ‘Spending on public services’ excludes factors such as debt interest payments.
** It’s become a bit of a myth that politicians failed to talk enough about post-2010 financial choices in that year’s general election. What the myth misses out is how reluctant the media was to ask about this either. The Lib Dem manifesto, for example, contained a commitment to a huge open-ended spending review with a view to making large cuts – but journalists almost never pursued this to ask what it meant, what was under danger of cuts and so on. Politicians didn’t set out plans in full, but neither did the media demand it of them.