Economy

The State We’re In

By Lord Ashcroft

“Britain is broken – people are getting poorer, nothing seems to work properly, and we need big changes to the way the country works, whichever party is in government.” In my latest polling, an extraordinary 72% agreed with this statement, including more than half of 2019 Conservative voters. Only just over one in five opted took the alternative view that “there will always be problems that need sorting out, but there is nothing fundamentally wrong with the way the country works.”

Many thinkers of various stripes agree: economists, including those on the Growth Commission established by Liz Truss, consider the urgent question of how to improve Britain’s sluggish productivity. Many others on the centre-right – not least those contributing to ConHome’s project on reducing demand for government – worry about an allied problem: that the state itself has become too big, expensive and burdensome, and that the Tories should make it their mission to rein it in.

This is a recurring theme in Conservative thought, and with good reason. But it’s easy to take the arguments for a smaller state for granted, and assume they are self-evident to everyone. At least as dangerous, politically, is the temptation to think in terms of theory when voters think almost exclusively in terms of practice. I therefore wanted to find out how people saw the questions at stake in this debate – about the tax burden, business regulation, spending and public services, the role of the state itself, and how they reacted to the low-tax, small-state agenda (more…)

Broken Britain has to be fixed – regardless of whether Rishi or Keir is PM

By Lord Ashcroft

This article was first published in the Mail on Sunday.

After 13 years of Conservative government, things were not supposed to look like this. Strikes, inflation, record NHS waiting lists, a sluggish economy and apparently uncontrollable migration point to a country where things are going wrong. Covid and Ukraine sound increasingly like excuses, not explanations.

But people sense more than an administration running out of steam after a bruising stint in office. I found more than seven in ten agreeing that Britain is broken and needs big changes, whichever party is in charge.

Political and economic sages debate how to boost the dismal rates of productivity that hold the country back compared to its more prosperous peers. For many Conservative thinkers, pondering the party’s direction in a new term of government (or, as many expect, in opposition), the problem is the state itself. Recent Tory governments – prompted by Covid and a desire to show suspicious voters that austerity was over – have spent, taxed and borrowed at a rate that would have made Gordon Brown blush; these critics argue that government has grown too big, tries to do too much, and so imposes an excessive burden on business, workers and families.

There is a lot to be said for this view: allowing governments to consume ever more of our national income is a recipe for economic and social decline. But as Mrs. Thatcher’s Tories understood in 1979, any attempt to reverse the trend has to start not with economic theory, but with people (more…)

If things are so bad, why aren’t more people saying it’s time for change?

By Lord Ashcroft

As campaigning for the local elections reaches its climax, one particular poll finding has caught my eye. A ComRes poll for the Independent conducted last weekend found 58 per cent of voters saying the government’s economic plan has failed, and so it will be time for a change of government in 2015. The Independent described this as a boost for Labour, but my reaction was different. “58 per cent”, I thought. “Is that all?”

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A memo to Ed Miliband

By Lord Ashcroft

Dear Ed

It is evidently the season for offering you well-intentioned advice. Since I spend rather a lot of time finding out how the voters see things, I thought you might appreciate a view from the other side of the fence. (more…)

Voters must believe we have more to offer than austerity

By Lord Ashcroft

Imagine becoming Chancellor at a time of record public borrowing. The country’s banking industry is engulfed by gargantuan losses, and our European trading partners are flat on their backs because of their failed single currency. The energy infrastructure needs the biggest ever investment in new power plants. The population is ageing rapidly, and the nation’s already overtaxed workers and businesses face growing burdens. Meanwhile, a group of new economies is emerging, each educating more engineers, mathematicians and scientists than Britain and able to produce more at a lower price.

George Osborne doesn’t have to imagine.

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A simple proposal to help the Treasury

By Lord Ashcroft

Over the last few weeks we have heard a good deal about the tiny amounts of corporation tax being paid in the UK by companies like Starbucks, Amazon and Google. Executives from all three were grilled by the Public Accounts Committee last month; others are sure to follow.

The problem, in a nutshell, is this. Overseas subsidiaries of global companies, incorporated in countries with lower tax rates, can charge royalties to fellow subsidiaries in the UK, or supply goods with a mark up, in order to channel profits between the two subsidiaries and therefore between countries. The effect is to reduce the profits of the part of the business based in Britain, and therefore the tax payable here.

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Project Red Alert

By Lord Ashcroft

Like David Cameron, Ed Miliband has an election-winning coalition to build. And like the Prime Minister, he has a dilemma to go with it. Labour’s lead in the polls looks consistent, but is it firm? My latest research report, Project Red Alert, seeks to answer this question.

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Much aid spending is counter-productive and only serves to fuel corruption

By Lord Ashcroft

To many people, the House of Lords is an anachronism; few of our proceedings capture public attention. Yet one of the reasons I am so proud of the House is the quality of debate. Discussions in the upper chamber can cast fresh light on a subject, free of the partisan ding-dong that so often characterises the Commons.

Last Monday’s discussion on the effectiveness of development aid was a prime example. Wise and experienced speakers on all sides of the House weighed in on a debate which served to underscore the flaws in the government’s international development policy.

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The Tories have a plan to win the next election and the team to deliver it

By Lord Ashcroft

Things may be looking up at last. This year has brought a long string of bad news for the Conservatives, much of it self-inflicted. Yet over the last few weeks I have become  a little more confident about Tory prospects than I have been for some time. There are two main reasons for this surprising burst of optimism.

First, last week’s growth figures. I am aware of the caveats, of course. The figures are notoriously unreliable, and one set of numbers does not change the experience of any actual voters; we are some way from any kind of feelgood factor. And as we can never forget after 1997, economic recovery does not necessarily lead to political recovery. This time, however, I think the chances are that it possibly could.

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Review of George Osborne: The Austerity Chancellor

By Lord Ashcroft

 

Text of my review of George Osborne: The Austerity Chancellor by Janan Ganesh, which appeared in the Guardian on Saturday.

 

What sort of politician is George Osborne? The fact that you can read Janan Ganesh’s detailed and illuminating book about the chancellor and still be left wondering shows how difficult the question is to answer. Conflicting views are offered as to where Osborne lies on the spectrum between pragmatist and ideologue. Nevertheless, Ganesh skilfully presents the rise of a politician “fixated on the centre ground”, whether that fixation results from principle or electoral calculation.

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