Until recent years, the word “austerity” was associated with the hardship, rationing and lack of basic resources experienced in the aftermath of World War II. However, since the 2008 global economic crash, successive UK governments of all parties have acknowledged the need to cut down and streamline public spending commitments. And so austerity was resurrected. Key social and economic policies were affected, and in turn, the public services used by ordinary people.
In her speech to the 2018 Conservative Party conference the prime minister, Theresa May, announced that this most recent version of austerity would soon come to an end. May said she wanted to see through the Brexit process and then address public spending. This suggests a re-focus of her key domestic political aspirations when she took office in summer 2016 – namely to assist “just-managing families” and address “burning injustice”.
A relaxation of austerity may be seen as a means of reviving and fulfilling this original agenda.
Origins and motives for austerity
At the time of the 2008 crash the Labour prime minister, Gordon Brown, accepted that tougher economic times lay ahead. He pledged his own version of austerity in the aftermath. This followed a decade of relatively strong economic performance and steadily increased levels of public spending since his party came to office in 1997. While the slump was global in its nature and origins, Brown has acknowledged that Labour could have been better prepared for dealing with such an economic shock.
This economic setback played a part in Labour’s electoral defeat in 2010. And indeed, austerity quickly became a key feature of the Conservative-Liberal Democrat coalition administration that came to power next. There were some inter-party tensions as to how severe such austerity measures should be, but the coalition government argued that its priority was to “balance the books” and reduce the national deficit at a quicker and arguably more brutal way than Labour proposed.
Yet economic performance remained sluggish for the early years of the coalition while the deficit remained relatively high. The government missed targets while its borrowing levels continued to rise between 2010-15. Ultimately, while austerity politics have gradually eroded the size of the UK financial deficit over the past ten years, the national debt has actually grown.
Left-wing critics argued that a more sinister ideological motive lay behind austerity politics. They saw the coalition’s primary aim as “shrinking the state”, following up the Thatcherite neoliberal policies of the 1980s. Cameron denied this, as has May – although in her time as home secretary (2010-16) she did preside over significant cutbacks to police numbers.
In addition to this failure to swiftly reinvigorate the economy, the demands of austerity have placed considerable strain on local authorities in particular, which seem to have borne the brunt of much of the government-imposed cutbacks. With an estimated £18 billion cut from local council budgets between 2010 and 2015, this in turn has adversely effected key services such as child protection, health and social care, social services, housing support and education.
Claims have circulated that such levels of austerity have actually created worsening public health. An academic report in 2017 claimed 120,000 additional deaths could be linked to austerity policies, although the government has rejected this accusation.
Austerity’s political costs
The political costs of prolonged austerity arguably came home to roost in the 2017 general election. In 2015, the Conservatives had been seen as more economically responsible than Labour, which seemed reluctant to apologise for its economic record in office. However, just two years later, austerity seemed to be damaging the Conservatives out on the campaign trail.
The political implications of austerity may have had even wider implications for both domestic and international politics too. Liberal Democrat leader, Vince Cable, recently suggested that the social hardships imposed by austerity politics may well have influenced the 2016 Brexit referendum outcome.
On one level, May can therefore be viewed as moving on and learning from past political lessons. That reflects the approach of a sensible and pragmatic politician. This is important if she wants to remain prime minister and even lead her party into the next general election. This might seem an unlikely prospect after her 2017 general election setback, prolonged Brexit-related challenges, and subsequent internal party dissent, May has so far proved to be far more durable than many observers had predicted.
May often depicts herself as a compassionate Conservative, willing to use the powers of the state to help those in most need. Even her principal Conservative leadership challengers such as Boris Johnson have positioned themselves similarly. However not all of her party subscribe to this viewpoint, and some of her MPs view Brexit as an opportunity to shrink the state and the levels of government expenditure even further.
On this premise, her pledge to deliver a post-austerity “Brexit bonus” is bold in terms of rhetoric, but questionable in terms of practical delivery. Sceptics would point to the political right of her party, their distaste for high public spending, and their particular power stemming from May’s minority parliamentary status as reasons why her austerity promise may never be fulfilled.
Evidence-based articles by academics on ending austerity: