THE success of a political leader depends on three characteristics: ideas, personality and voter appeal. These qualities are obviously interconnected, but they need to be disentangled if we want to understand the Conservative leadership contest, which comes to an end this week — and especially if we want to get a sense of the new Tory leader’s likely impact on British politics more broadly during the rest of this decade.
This trite-sounding point is worth making because the Tory contest has exposed the two candidates’ personal qualities and voter appeal to endless media scrutiny and public exposure; their relative charm, charisma, rhetoric and “electability” have been tested, assessed and measured by every conceivable metric, through focus groups, hustings and opinion polls. But their ideas and policy proposals have hardly been considered — on the assumption that the Tories’ first priority is to find an electable leader, at which point everything else would gradually fall into place. This may be a reasonable calculation, but given that Britain is still four years away from a general election — and probably eight years or more from a change of governing party — it will be the new leader’s ideas, rather than his personality and rhetoric, that will determine his ability to shift the terms of the country’s political debate.
What, then, do the two candidates really believe in and how might their ideas change British politics in the years ahead? The blizzard of speeches, debates and articles since this contest started has done more to obscure than to clarify their fundamental beliefs.
Consider the statement of core “Conservative values” that David Cameron has repeated almost verbatim in his campaign speeches and public debates: “We believe in the family, in personal responsibility, in lower taxes, in high standards of health and education, in limited government and in national sovereignty.” Neither David Davis nor any Tory voter could disagree with any of these principles, nor even with the slightly more specific policy commitments behind them — for example the promise to “share fairly the fruits of economic growth between lower taxes and strengthened public services”, or to “strengthen the nuclear family, but not preach to people about how they should live their lives”. If such platitudinous ambiguities were really the essence of the New Tory credo, the rejuvenated party would find itself supporting not just Tony Blair, but also Gordon Brown, in almost everything they did or said.
What are the real convictions behind these deliberately ambivalent soundbites? To try to delve deeper I spoke to them both off the record, on the understanding that I would then offer a personal assessment, rather than quoting verbatim from what they said. Here then is my sense of where the candidates really stand.
On the most fundamental issue for any government, which is the balance between taxes and public spending and therefore between the individual and the State, the two candidates really are poles apart.
In Cameron’s case, there is very little behind the sound-bites on this core issue. The idea of “sharing” the proceeds of economic growth between tax cuts and public services implies only that public spending under a Cameron government would rise no faster than GDP. Since Gordon Brown’s fiscal plans already suggest that public spending will slow to the same rate of growth as GDP from 2008 onwards (and Brown will fully commit himself to this goal in next week’s Pre-Budget Report), does this mean that Cameron’s tax and spending policy would be identical to Labour’s?
This is where Cameron’s constructive ambiguity comes in useful. Since the “sharing” formula implies that there must be some tax cuts, public spending would grow somewhat less rapidly under Cameron than Brown — but the size of the gap and whether it would create scope for anything more than inconsequential tax cuts would depend on whether efficiency savings could be achieved in the public sector without damage to services.
The Davis position on tax and spending takes exactly the opposite approach and comes up with commitments that are much more clear-cut, at least from an arithmetical standpoint. His calculations start with the insistence that the growth of public spending must be restrained to 1 per cent below the growth of GDP. This means a cut of 1 per cent each year in relation to Gordon Brown’s plans. This is a modest-sounding target, but considering that public spending has grown 2 per cent faster than GDP since the start of this decade, it would imply a transformation of public sector performance. If such a change could be achieved, the steady build-up of 1 per cent economies would allow Davis to deliver his promise of a tax cut of roughly equivalent to 4 per cent of GDP, or £40 billion, at the end of a four-year parliament.
But how would Davis deliver his spending slowdown without decimating public services?
Here he appeals to his managerial experience in the private sector and as chairman of the Commons Committee on Public Accounts: waste, inefficiency and over-manning are rife in the public sector and if government productivity could only be raised to levels that are taken for granted in private industry, achieving a target of 1 per cent savings each year should not be impossible, even while services are improved. This is an attractive argument, but one which has been made by every opposition politician in every country in every age.
Would Davis be any more likely to deliver efficiencies than Brown or Blair, Major or Thatcher? Davis’s supporters suggest one possible reason. Unlike previous Prime Ministers, with the partial exception of Mrs Thatcher, Davis believes in an American-style “supply-side” tax policy. This means that he might try to use tax cuts to accelerate economic growth, even if this meant accepting large temporary public deficits, as Reagan did in the early 1980s and Bush did in his first term. It also means that Davis might use tax cuts deliberately to create public deficits in the hope that these would in turn force spending discipline on the public sector — a strategy that Reagan described as “cutting government off at the pockets”. It remains unclear where spending economies could be found by either Cameron or Davis, unless major government programmes were cut drastically or privatised.
So how do the two candidates differ on the three great public service issues — health, education and pensions?
On health and education, both Davis and Cameron promise higher quality, more choice and lower costs, by bringing in more private enterprise, eliminating centralised targets and allowing managerial autonomy for hospitals and schools. But do these ideas really differ from the Brown-Blair reform agenda? Not very much, especially in Cameron’s case. While both candidates insist that they would go much further than Labour in encouraging private-sector provision, competition and local independence, they mostly draw back from truly controversial measures.
Cameron wants to introduce new financing and contractual arrangements for the health service but is adamant that the “NHS must remain free at the point of use”. He supports only two new ideas for directly charging public-service users: university top-up fees and road tolls — taboos that Labour has already overcome.
Davis seems rather more radical on education and health, advocating 20 new grammar schools in inner-city areas, vouchers to give greater freedom of choice to the poorest parents and government co-payments for operations conducted outside the NHS. But when it comes to the biggest issue of principle — the publicly financed NHS, he is almost as adamant as Cameron: health services must remain free at the point of use.
On pensions, both Tory candidates seem more committed to government provision than Blair and Brown. Both insist that the government should return to the uprating of the basic state pension in line with earnings, rather than prices. And both seem to believe, despite their rhetoric about individual responsibility, that government must ensure that people save enough to support themselves in their old age.
The same contradiction between rhetoric and reality is evident in the raft of family and lifestyle issues to which both candidates have devoted large parts of their campaigns.
Cameron frequently demands, for example, that the state should “actively support marriage through the tax and benefits system”, while insisting that there should be no bias against cohabiting couples or single parents. But how can the State give “active support” for marriage without, ipso facto, treating other domestic arrangements less favourably?
This question, in a way, is a parable for the whole contest. How can a Tory leader offer a genuine alternative to a Labour Government without alienating some Labour voters and thereby making himself appear less electable?
The Conservative Party has a week left to decide this — and then four years to explain.
Cameron Credo
TAXES AND PUBLIC SPENDING
Fruits of economic growth will be fairly shared between lower taxes and strengthened public services
HEALTH
More private provision and competition, but tax-financed NHS must remain free at the point of use
EDUCATION
Greater autonomy for schools and freedom to set selection criteria, but no return to selection by ability at 11. Supports university tuition fees and suggests they should be allowed to rise
PENSIONS
Basic state pension uprated in line with earnings, not prices. Compulsory savings may be required
FOREIGN POLICY
Supports Iraq war. Rejects euro on principle. Would reverse EU control of fisheries policy and withdraw from employment and social policies. Would pull Tories out of the centre-right European People’s Party (EPP) grouping in European Parliament
Davis Dogma
TAXES AND PUBLIC SPENDING
Public spending growth will be 1 per cent less than GDP, creating scope for £38 billion tax cuts after four years
HEALTH
More private provision and competition. Some experiments with user charges, but key services must remain free at the point of delivery
EDUCATION
Greater school autonomy, vouchers to promote private provision and expansion of grammar schools. Opposes tuition fees, arguing that graduates will pay for higher education through income taxes. Redirect funds to best universities by abandoning expansion targets
PENSIONS
Basic state pension uprated in line with earnings, not prices. Reversing “pension tax” a top priority in tax cut plans
FOREIGN POLICY
Supports Iraq war. Rejects euro on principle. Would return national powers from EU level. Not committed to withdrawal from EPP
