A predicament for either party

20th February 2004 at 00:00
The Conservative pledge to protect education spending does little to disguise the uncomfortable fact that the years of booming school budgets are coming to an end.

Beneath the Tories' headline promise of a 9-per-cent-per-year increase for education and health, lurks the fact that the public purse is now almost empty.

Last month, under cover of the tuition fees rebellion and Lord Hutton's report, the Chancellor admitted that the Government's next three-year spending review will be less generous than the last.

"I am determined we will avoid the short-termism and mistaken policies of the past," he said.

With a predicted pound;11 billion hole in public finances by 2006, this caution is understandable if not acceptable to those at the front-line of public services.

For either party, sustaining increases in education spending beyond the end of the current three-year period will involve a combination of nimble bookkeeping, tough choices and a lot of luck. To do it as the Conservatives promise, while cutting pound;35bn from public spending, will require the latter in spades.

Their plans rely on slashing central bureaucracy, a strong economy and public willingness to accept that the police and railways can cope with further cuts.

While the latter is a bold political move, cutting bureaucracy and relying on growth are opposition sleights of hand normally savaged by the government of the day.

But after the Conservatives' announcement this week, it will be almost impossible for a Labour Chancellor with leadership ambitions to promise schools less than they would get under the Tories.

That leaves Mr Brown with three choices: sacrifice his reputation for financial responsibility, raise taxes in the year before a general election or find savings elsewhere.

Conveniently, the Government's review of public spending, headed by Sir Peter Gershon, has identified pound;10-pound;15bn of savings to be made by 2007.

So while ministers attack the Tories for cooking the books, do not be surprised if they steal part of the recipe for themselves.

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