Feeling sharp end of cuts

5th November 2010 at 00:00

As is usual before writing my column, I contacted the editor of this august journal to get a steer about what would be in forthcoming issues, so I might comment on a related topic. I was given an answer that was short and to the point: "Cuts, cuts and more cuts."

Chancellor George Osborne has announced his spending cuts, at pound;81 billion, bigger than what Labour was willing to admit to - but, and it's a fact, still leaving public spending higher than it was in 2006-07. Government deficits will still run wildly high for years to come and the national debt will continue to rise.

Try looking at it this way. You are running a company, maybe a chain of high street bookshops and, at the end of the year, it loses pound;38 million; so you borrow to cover the loss. That was in 2003.

The losses continue but you plough on with your expansion plans, spending more money, offering more services, taking on more staff and telling everyone that everything will be all right.

The losses continue, growing over time, until by 2009 you lose a record pound;156 million. As a result of all these annual deficits, your debts now amount to pound;842 million, including interest.

Why not increase your prices? Unfortunately, you did this so much in the past that you can't increase them any more or your wealthiest customers will just go to another, cheaper, bookstore and your sales will actually fall.

Your forecasts tell you that, for the foreseeable future, you expect to trade at a loss with deficits making your debt rise to pound;1.3 billion until at least 2014. All of this will be covered by borrowing from international investors with interest becoming larger than your annual loss.

Do you make changes in what you do and how you do it, so that you achieve a surplus like you used to? No, the best you can manage is to close some of your stores and reduce some of your lines to the levels of what you were offering four years ago. It will reduce your annual deficit to pound;39 million, so your debt will still go up but it won't be quite as bad as it might have been.

The story of that bookstore - only with the deficits in billions and the debt now in trillions - is why we are having spending cuts now; cuts that will take us back to the spending levels of 2006 when, if I recall correctly, there was contentment about the educational resources available to do the job.

There is one difference, of course, and it is crucial one. The total amount of money available may have been reduced to 2006-07 levels, but the way it will be spent has changed beyond recognition. That's because the spending on health is being maintained at 2010-11 levels within the 2006- 07 total.

The Scottish Parliament could change the policy if Finance Secretary John Swinney chose to ask it - but there is an election next year and he thinks it better to shield the NHS until at least after the electorate has spoken. Nowhere do I see or hear education leaders arguing for the cuts to be fairly spread across the services. Why the silence? What are union dues for?

The result is there for all to see in Scottish education. Cuts, cuts and more cuts. East Lothian and Midlothian councils are looking to merge their education provision in an attempt to find savings that will make any cuts blunter. Meanwhile, Argyll and Bute Council shows how sharp it can be by proposing to close 26 primaries.

These announcements are only the beginning for education in Scotland and you will find more in these pages. Cuts, cuts and more cuts. Will no one speak up for Scottish education and champion its case?

Brian Monteith considered 2006 a vintage year; now he knows it was.

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