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The state of the public finances means “painful” economic choices after the election but a conspiracy of silence between the main parties is leaving voters in the dark, a leading think tank has warned.
The Institute for Fiscal Studies (IFS) has slammed the Tory and Labour manifestos, warning they leave people “guessing” on future tax rises and public spending cuts.
Paul Johnson, the director of the IFS, also hit out at Reform and the Greens, accusing them of tax cut pledges which “helps to poison the entire political debate”.
He said their “unattainable” figures make the other parties look “feeble”.
Mr Johnson warned there are painful economic decisions ahead but said “none of which are faced up to” in the election manifestos.
These leave voters “guessing” on tax and spending, and on the future size and shape of the state, he added.
The IFS warns several public services are at risk of suffering “sharp cuts” under either a future Labour or Conservative government.
The manifestos of the major parties provided little information about the funding outlook for individual services, which makes it easier for them to stay silent on the cuts to unprotected budgets.
They could have provided more details on their priorities and rough minimums or totals for different areas of spending in a bid to “give a sense of what we can realistically expect from them” in the next parliament.
Broadly, the IFS said the priorities of each party “do not tell us anything about overall spending on each public service”.
The IFS says Nigel Farage’s Reform proposes £90 billion of specific tax cuts and £50 billion of spending increases, “paid for” by a £150 billion package of measures that includes substantial, unspecified cuts in welfare and government waste.
Mr Johnson said: “If they want a smaller state – a perfectly reasonable ambition – they should tell us how they will achieve it. We saw the consequences of massive tax cuts with no detail on how they would be paid for in September 2022.”
He said the claim the party could eliminate NHS waiting lists at a cost of £17 billion a year is “demonstrably wrong”.
And he said the large tax cuts would cost “even more than stated, by a margin of tens of billions of pounds per year”.
The Greens want an additional £80 billion a year of borrowing.
“A massive increase in borrowing when the economy is capacity-constrained – and the debt interest burden is already just that, a huge burden – would have unpleasant consequences,” Mr Johnson said.
Their biggest proposal, a £90 billion a year carbon tax, would incentivise a faster transition to net zero but would have “far-reaching economic implications” including making the cost of many essentials more expensive.
“Much, probably most, of any money raised, would need to be used to mitigate those effects, and to support those on lower incomes, not to fund other things. In any case, any effective carbon tax would reduce the amount of carbon-based activity and hence, eventually, raise a lot less,” Mr Johnson said.
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