If The Reform Party were to form the next government, the UK would enter a period of austerity reminiscent of the one that defined the David Cameron and George Osborne era. While the party's rhetoric often focuses on a "common sense" approach and cutting "waste", their economic policies reveal a commitment to major spending reductions that mirrors the fiscal tightening of the 2010s.
The Cameron-Osborne government, elected in 2010, made a conscious decision to tackle the UK's deficit, which had ballooned in the wake of the 2008 financial crisis. Their mantra was that the country could not continue to live beyond its means. The chosen method was a program of austerity, with the vast majority of deficit reduction coming from spending cuts rather than tax increases.
Reform's platform, while presented with different branding, operates on a similar principle. They have proposed a range of significant tax cuts, including lifting the income tax threshold and reducing corporation tax. To pay for these measures, they plan to slash government spending. Their manifesto outlines a goal of saving tens of billions of pounds a year by cutting "wasteful spending", reducing the size of the civil service and reforming public services.
The Cameron-era austerity had a profound impact on public services and welfare. Budgets for local government were severely reduced, leading to cuts in services like libraries and youth centers. The Welfare Reform Act of 2012 introduced the "bedroom tax" and a benefit cap, and froze most benefits for a number of years.
Reform UK's proposals will follow a similar playbook. While they talk about protecting "frontline services", independent analysis, such as that by the Institute for Fiscal Studies (IFS), suggests that their proposed cuts would be so substantial that they would inevitably require a significant reduction in the quantity and quality of public services.
For example, the party has proposed a major overhaul of the welfare system, with a strong emphasis on getting people back to work and withdrawing benefits for those who do not comply. While they have promised to scrap the two-child benefit cap, this is dwarfed by their broader plans to reduce welfare spending by getting people off benefits and tightening eligibility.
The economic legacy of Cameron's austerity is a matter of fierce debate. Proponents argue that it stabilized the UK's finances and laid the groundwork for a return to growth. Critics, however, contend that it stifled economic recovery, led to a "lost decade" of stagnant wages and low productivity, and disproportionately hit the poorest in society.
Reform's economic plans face similar questions. The party believes that their combination of tax cuts and spending cuts will "re-energise the economy" and spur growth. However, economists warn that the scale of the cuts needed to fund their tax plans would be unprecedented and could lead to a severe contraction in public spending, with uncertain consequences for the economy and for society.
While Reform is a new force in British politics, their proposed economic policy echoes a familiar chapter. Their commitment to deep spending cuts to pay for tax reductions bears a striking resemblance to the austerity program implemented by David Cameron's government.
