Reeves can't afford to ignore the cost of government waste

Telegraph

4 hours ago

The Government has let public sector waste, incompetence and inefficiency run out of control. No wonder Rachel Reeves is having to tell the Home Secretary there's not enough cash for the police and Border Force when the public wants an end to illegal migration and anti social behaviour, and no surprise the Deputy Prime Minister is railing against the shortage of cash for councils and housing when she needs billions extra to help all the new arrivals to the UK find subsidised accommodation and the public services to go with the homes.
But we are not in an entirely hopeless situation. There is plenty of money to be better spent, budgets to be switched and losses to be stopped. Fraud takes large sums from the welfare budget. Too many people claim benefits on a sickness note for life when they could work, some desperately manoeuvre for a false (but helpful) diagnosis.
We need a fairer system which is generous to those who are seriously disabled without threatening them with cuts, but does much more to help all the others into work. If you can work, and a job is available, you should not stay on benefits. There are the continuing over the top losses on bonds by the Bank of England which taxpayers have to pay for. No other Central bank sells bonds at big losses in the market as ours does, to add to taxpayer woes.
Total losses from mid 2022 to the full wind up of their bond portfolio next decade are estimated by the OBR to stand at a stunning £250 billion. Tell the bank to cut these losses, as the European Central Bank has done with its badly bought bonds.
Then there in the inexcusable waste that comes from big subsidies for the nationalised industries. Some of this waste is a direct response to prior poor policy.
There is no statement from the Government of how it will control the likely big cost of its steel intervention, necessitated by an energy policy that sells industry unaffordable power. The Budget gave a large pay award to well paid train drivers without asking for smarter working to boost productivity. This blank cheque system is utterly unsustainable: tell the management they will only get bonuses and high pay in future if losses are reduced and fare revenue is boosted from more travel.
The civil service expanded greatly to tackle vaccinations and lockdowns over Covid. It has grown more as we recover from the pandemic. It is unreasonable that when Ministers ask for some restoration of lost productivity, they are told they need to spend to save.
Those holding out hope for an AI moonshot may see some gains in due course, but we literally cannot afford to delay an enforced return to 2019 levels of productivity (hardly impressive at the time) any longer. That need not await a study of how to buy better computers.
There should be a ban on all external recruitment to the public sector, exempting key NHS personnel, uniformed staff and teachers. Ministers could authorise other special cases.
Natural wastage in the civil service could save 7 per cent per cent a year on staff bills as we seek to get back to 2016 manning levels. This high rate of industry churn means more opportunities for bright and energetic public officials, as there will be more internal opportunities as staffing is rearranged and focused on main tasks. Such individuals must be empowered to take real ownership over bureaucratic structures.
Perhaps the greatest cost – certainly in electoral terms – is the growing number of illegal migrants. The Government made changes to inherited policy which made a bad situation far worse. Numbers have shot up and the hotels are full.
Again, a ruthless dedication to getting value for money already being spent would help, and we are certainly not getting value for the big money we give to France to police their coast. How come the French can safely intercept a UK fishing boat and take it to
France for a court action over its paperwork, but they cannot stop a single people trafficking vessel at sea and do not prosecute the boat drivers?
The country will not accept paying more for less every year. If the Labour Government is able to get this reckless waste under control, the Chancellor's future Budgets will only condemn the party to electoral oblivion.