David Gauke is a former Justice Secretary, and was an independent candidate in South-West Hertfordshire at the recent general election.
The Government’s announcement that it is undertaking an independent enquiry of the Greensill Capital affair is unlikely to bring much cheer to David Cameron. He has endured weeks of bad publicity, and there is little chance that the story is imminently going to ‘move on’.
Whatever the rights and wrongs of the former Prime Minister’s actions – and he has acknowledged making mistakes – the furore is all the more painful because his reputation as Prime Minister was already at a low ebb. Critics of his economic policy accuse him of inflicting austerity which, they argue, were unnecessary, stunted growth and damaged public services; he is castigated by Remainers for calling and losing the Brexit referendum and by Leavers for being a Remainer; some on both sides accuse him of deserting his post by resigning the morning after the poll; his electoral successes have been surpassed by Boris Johnson’s thumping majority in 2019. Not unrelated to this, neither the man nor his political values appears to have much influence on the modern Conservative Party.
Defending Cameron’s record in office is deeply unfashionable. So I will do so.
Let us start with the economy. There are few defenders of ‘austerity’ in today’s public debate. Labour still want to argue that the electorate got it wrong in 2010 and 2015, just as they tried to do in 2017 and 2019 (which, incidentally, suggests that this might not be a guaranteed route to success). Johnson, meanwhile, is not temperamentally an austerian and enjoys the opportunity to demonstrate that he is new and different from recent Conservative history.
The economic debate has also moved on. Governments have been able to borrow vast sums of money in the last year without much of a risk of a sovereign debt crisis. Central banks have played a more active role, debt servicing costs have fallen and international organisations have advocated expansionary fiscal policies. This may all go wrong at some point – there is more reason to worry about inflation than for many years – but it hasn’t gone wrong yet.
None of this means, however, that the concerns of fiscal conservatives back in 2010 should be dismissed. The global financial crisis had resulted in substantially higher spending and permanent damage to tax revenues. The risks of a sovereign debt crisis – with consequences for inflation, debt interest costs and consumer and business confidence – were not imaginary. The IMF and the OECD advocated that countries needed to have credible plans to put the public finances on a sound footing, and many countries did just that. In short, the balance of risks and the expectations of the markets in the years after 2010 were very different to where we are now.
Did fiscal consolidation significantly hamper our economic recovery? It is true that economic growth in 2011 and 2012 was disappointing (although not as bad as it appeared at the time when the ONS early estimates suggested that we had had a double dip recession), but it is worth remembering that the independent Office for Budget Responsibility put this down to the lasting effects of the banking crisis, higher commodity prices and the Eurozone – not fiscal consolidation.
Looked at in the round, over the 2010-2016 period, the UK had the joint highest growth for a G7 economy, level with the US. It was also a period of rapid jobs growth, with the highest employment rate in our history and income inequality falling. Had the Brexit referendum gone the other way, there is every reason to believe that the post-2016 UK economy would have been characterised by high economic growth, rapidly rising living standards and strong public finances, as opposed to us falling to the bottom of the G7 league table.
Were public services were unduly damaged? Difficult decisions had to be made, but many of them were unavoidable given that the spending plans that we inherited were based on an over-optimistic, pre-crash assessment of what was affordable. It was possible to drive greater efficiencies and find ways of getting more for less. The British state has been placed under enormous strain in the last year by Covid but there have been some real successes. Just looking at two areas where I have some familiarity through Ministerial experience, HMRC was able to introduce the furloughing system in a matter of weeks, and the Department for Work and Pensions was able to cope with an extraordinary surge in benefit claimants. Neither would have been possible without reforms undertaken by the Cameron Government.
Having said all that, we relied too heavily on spending cuts over tax rises. It was politically easier at the time to cut spending rather than raise taxes and, as time went on, we got the balance wrong. Some areas of government spending – justice, for example, or social care – were squeezed too hard. But a period of spending restraint was necessary and inevitable and too many of Cameron’s critics fail to acknowledge that.
It was the decision to hold a referendum on the UK’s membership of the EU and then lose it that hangs most heavily over Cameron’s reputation. It will, unfortunately, always be for what he is remembered and, for many Remainers, this will never be forgiven. The referendum result created huge uncertainty and will, in my view, inflict lasting damage to the UK. But we should not kid ourselves that had he adopted a different approach our membership of the EU would currently be assured.
The Conservative Party was moving in the direction of being a Vote Leave Party – in part because of the fear of UKIP peeling off Tory votes – and the decision to offer a referendum was motivated both by a desire to win the 2015 general election by winning back UKIP voters but also by a recognition that a post-Cameron Conservative opposition would, in all likelihood, favour Brexit.
The best chance of staying in the EU, Cameron concluded, was to settle the issue early with a decisive Remain victory – the longer the issue was left, the greater the chance we would leave the EU. As it turned out, he was wrong to believe that he could deliver a Remain victory but he may have been right that this was the best chance of defeating Brexit.
As for the criticism that he should not have resigned following the poll, one lesson of the last five years is that the referendum did not tell us what exactly ‘Leave’ meant. I do not believe it is plausible to think that the European Research Group would have allowed the leader of the Remain campaign to define the answer.
More broadly, much of his political approach has stood the test of time. In wanting more women and ethnic minority MPs, caring about climate change and the environment and introducing equal marriage he took positions that were controversial at the time but have aged well.
Yes, Johnson’s majority in 2019 – and continued strength in the polls – exceeds anything achieved by Cameron, but it is not clear that a political strategy based on white voters without post-16 academic qualifications is the right long-term strategy for an electorate that is becoming more diverse and better educated.
Cameron represented fiscal conservativism, social liberalism and internationalism. These values may be out of favour but they are not wrong. It is too early to say to what extent his personal reputation will – in time – recover but the dismissal of the achievements of his Government is undeserved.
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Author: David Gauke
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