I've covered research from Tullett Prebon here before but, their Tim Morgan has now produced all three parts of what he calls the 'Reform Trilogy'.
It is impressive stuff so much so, that when I was interviewed for Panorama last week almost everything I said could be traced in one way or another back to their work.
The first part of the trilogy explained why it is that our economy as it stands is not capable of delivering growth. It suggested that the way to go might be with a core strategy of cutting spending and handing cash back to working people and businesses via tax cuts.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
The second went into considerable detail on how "reversing a large part of the last decade's vast increase in public spending need not harm the public services, front line public sector workers, or those in genuine need."
It asked how much government the UK can really afford. It asked where given the recent 50% real rise in public spending in the UK all the money has gone and whether it really needed to go there.
The Brown Bonanza showered money all over the place. In real terms, healthcare spending rose 89%, transport rose 87%, education went up 60% while welfare spending rose 45%.
Some of that money is surely well spent, but does it really make sense for the number of managers in the NHS to have risen by 77% when the number of nurses is only up by 23%? And should real term procurement costs in the NHS really have risen by 80% over 10 years?
Probably not. The last ten years have been a story of rising spending, but also of rising costs and falling productivity. You can read the full report on thishere, but the key point Dr Morgan makes is that much of the rise in costs has been down to the nonsense of attempting to introduce private sector competition into organisations in which there is no place for it.
It made sense to privatise BA in the Thatcher years, but not to attempt to introduce "pseudo competition and spurious choice" into the NHS. It worked better as a command structure than as a series of hospital and primary care trusts. Instead of increasing efficiency it has simply produced layers of expensive administration.
Undoing it all could save billions (£10bn from dumping the managers and £30bn-40bn from savings in procurement).
Add that to means testing for currently universal benefits; some tightening of eligibility for benefits; a cap on the total amount of benefit any one claimant can get to around £20,000; and the savings here, says Dr Morgan, could be another £12bn.
His total saving? £70bn. Any other ideas to add to the total below please.
The final part of the trilogy focuses on how to hand these huge savings back to ordinary and increasingly impoverished working people the ones that all our parties say they so want to help. It is here and, like the other parts, worth reading.
-
Ofgem proposes new energy tariffs with low or no standing changesStanding charges have invited public backlash as households battle high energy bills
-
Google shares bounce on Gemini 2.0 launchGoogle has launched the latest version of its Gemini AI platform, and markets have responded positively. Is it time to buy Google shares?
-
Beating inflation takes more luck than skill – but are we about to get lucky?Opinion The US Federal Reserve managed to beat inflation in the 1980s. But much of that was down to pure luck. Thankfully, says Merryn Somerset Webb, the Bank of England may be about to get lucky.
-
Rishi Sunak can’t fix all our problems – so why try?Opinion Rishi Sunak’s Spring Statement is an attempt to plaster over problems the chancellor can’t fix. So should he even bother trying, asks Merryn Somerset Webb?
-
Young people are becoming a scarce resource – we should value them more highlyOpinion In the last two years adults have been bizarrely unkind to children and young people. That doesn’t bode well for the future, says Merryn Somerset Webb.
-
Ask for a pay rise – everyone else isOpinion As inflation bites and the labour market remains tight, many of the nation's employees are asking for a pay rise. Merryn Somerset Webb explains why you should do that too.
-
Why central banks should stick to controlling inflationOpinion The world’s central bankers are stepping out of their traditional roles and becoming much more political. That’s a mistake, says Merryn Somerset Webb.
-
How St Ives became St Tropez as the recovery drives prices sky highOpinion Merryn Somerset Webb finds herself at the epicentre of Britain’s V-shaped recovery as pent-up demand flows straight into Cornwall’s restaurants and beaches.
-
The real problem of Universal Basic Income (UBI)Merryn's Blog April employment numbers showed 75 per cent fewer people in the US returned to employment compared to expectations. Merryn Somerset-Webb explains how excessive government support is causing a shortage of labour.
-
Why an ageing population is not necessarily the disaster many people think it isOpinion We’ve got used to the idea that an ageing population is a bad thing. But that’s not necessarily true, says Merryn Somerset Webb.
