Cuts didn’t work in 1930s and don’t now

'Public services are struggling under the strain of the UK government cuts'. Picture: Sandy Young

'Public services are struggling under the strain of the UK government cuts'. Picture: Sandy Young

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Myth of public sector spending is dangerous, says Dave Watson

We are halfway through a needless assault on our public services and we need to get real before it is too late. To date £3 billion has been cut from the public sector in Scotland, with £3bn of further cuts forecast. So far 50,000 public service jobs have been lost, with a further 60,000 forecast to go.

Yet here we are. Our public debt continues to rise, productivity is low, wages are dropping, inequality is increasing and youth unemployment is high.

The idea that our present economic woes are a crisis stemming from out-of-control public finances is the neo-liberal myth of our times. Remember when the UK government told us we would be the next Greece?

Our public services are struggling under the strain of the UK government cuts. Within that framework, the Scottish Government has chosen to hit local government the hardest.

But other sectors struggle too – £139m will be slashed from police budgets between now and 2017, taking officers off of operational duties to cover civilian jobs at twice the cost.

Unison has been systematically surveying groups of our members and the evidence is broadly the same – corners are being cut and plates are kept spinning in the hope that the whole facade doesn’t come crashing down.

This is the workforce who cares, cures and educates; they support and protect us at different stages of our lives. Yet they are delivering more for less money.

Austerity cuts are ideological and they damage lives. They hit low-paid women hard; risk a lost generation of young people who can’t find work; increase child poverty and create greater levels of inequality.

But more to the point, austerity is economically illiterate. It did not work in the 1930s and it’s not working now.

Youth unemployment remains high and Scotland and the UK have the highest share of low-paid workers in the developed world, with one in five earning less than the living wage.

An estimated 120,000 new zero-hours contract jobs have been created in Scotland, and we will have 100,000 more children living in poverty by 2020 which is, coincidentally, the year we were supposed to end it.

Of course, there is another way. We can invest so we can create demand and quality jobs, building an economic system that delivers a decent standard of life for all.

We could reform our tax system to make it more progressive and crack down on tax dodgers. We need to agree that tax and public services are a good thing and value for money.

We need to end the regressive council tax freeze and allow local democracy to flourish, invest in houses to rent and give Scotland a pay rise.

A third – £10bn – of the Scottish Government’s budget goes mostly to the private and voluntary sector in procurement. An increase in public spending will bring investment to both, but that must come with strings. If you accept the public pound you must not expect the taxpayer to subsidise poverty wages. You must pay your taxes and adopt the sort of employment polices set out in the recent Mather Commission report.

The rising deficit actually reflects the collapse in tax revenues and rising cost of unemployment benefits during the recession, rather than out-of-control public spending. We are living through a crisis of unemployment, underemployment and stagnant growth.

Politics across the world is defined by this struggle. It divides the US, Europe and even emerging economies in Asia and the southern hemisphere. People are looking to more radical answers. We need to find ours soon.

In my view the political events of 2014 to 2016 will define our direction for the coming generation. In short, we can reject austerity, reject the same again, and build for another way.

We have a new First Minister and Scottish Labour is electing a new leader, followed by two elections. After the referendum, this feels significant.

Surely we need to get real. This is the debate of our times. The sooner we wake up to this, the better it will be for our economy, society and all of us.

Dave Watson is the head of bargaining and campaigns at Unison Scotland

The Unison Scotland report Austerity Economics Don’t Add Up can be downloaded at www.unison-scotland.org.uk/publicworks

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