Much ado about the
"http://www.guardian.co.uk/uk/2010/jun/29/budget-job-losses-unemployment-austerity">Guardian’s scoop this evening: a leaked Treasury document which forecasts that up to 1.3 million jobs could
be lost as a result of the spending cuts in the Budget. Or, to put it in the words of the document itself:
"100-120,000 public sector jobs and 120-140,000 private sector jobs assumed to be lost per annum for five years through cuts."
You can expect Labour to get stuck into these numbers, and the fact that they were previously hidden from public view, with no uncertain relish. Ed Balls has already described them
as "chilling". But it’s worth making a couple of points, by way of context:
i) There’s job creation too. The Guardian goes onto report that "The Treasury is assuming that growth in the private sector will create 2.5m jobs in the next five years to
compensate for the spending squeeze." So that’s an expected net jobs gain of 1.2 million. How much of that can be attributed to Osborne’s tax cuts, rather than just untampered growth, is
uncertain. But the number is certainly worth noting down.
ii) Labour job losses. Do the Treasury forecasts account for all the spending cuts over the next five years? Or do they account only for the new spending cuts announced in
Osborne’s Budget? You see, there’s a world of difference between the two, and the Guardian doesn’t make it clear which we’re dealing with here. If, as I suspect, it’s the former, then a
large proportion of those job losses would also have occurred under Labour’s proposed cuts, which Osborne simply added to last week. Indeed, it’s unthinkable that the Treasury didn’t produce
similar job loss figures when Darling was in charge and cutting spending. But, happily for Labour, they were never leaked at the time.
In the end, I suspect that the biggest danger to the coalition will be that this undermines their claim to transparency. And it doesn’t really help them to point out how Gordon Brown practically
made numbers up when it came to the jobs his measures had "saved". But, despite that,
the fact remains that this story may not be as awful as it first appears.