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Last Updated: Sunday, 21 November, 2004, 13:42 GMT
Interview with Oliver Letwin, MP
Please note BBC Politics Show must be credited if any part of this transcript is used.

NB:This transcript was typed from a recording and not copied from an original script.

Because of the possibility of mis-hearing and the difficulty, in some cases, of identifying individual speakers, the BBC cannot vouch for its accuracy.

Oliver Letwin, MP
The Shadow Chancellor, Oliver Letwin, MP

On Politics Show on Sunday, 21 November, 2004, Jeremy Vine interviewed Oliver Letwin, the Shadow Chancellor.

Jeremy Vine: And the Shadow Chancellor, Oliver Letwin joins us now. Welcome to you. There are tax cuts as a virility test, you're not a Conservative, a real Conservative unless you offer them.

Oliver Letwin: Well er, I believe that the main thing people want is value for money, value for tax payers money, that's our priority. We can't go on being a country in which the number of tax collectors is rising twice as fast as the number of doctors. We've got to have a value for money action plan and that's what we've been working at.

Jeremy Vine: But your most famous sound bite I would suggest was at this year's Tory Conference, and you said this, Offering tax cuts would not be courageous at all, it would be very easy, I'd say it, you'd cheer, the audience, we'd all leave, and no one out there would believe us at all. Now where does that leave the voter, you're offering them nothing.

Oliver Letwin: What we're saying to voters is, if you want the things we think you want, and that we want, cleaner hospitals, school discipline and more police on the streets, controlled immigration, you can have those things, and a lower tax economy, but in order to achieve that double act, we've got to get value for your money. Do you know, since the Chancellor announced that he was going to do something about the huge bureaucracy he's created, we've been charting what's actually happened by way of job adverts.

In just one newspaper, this is, this it, it's a hundred million pounds worth of public sector jobs since the 14th July and I'll read you some of them. The be-friending scheme co-ordinators, the skills for life and family learning manager, the welfare rights advisor, I go on and on. Now this is not the way in which the taxpayer gets value for money. We have to cut back (overlap)

Jeremy Vine: You'd cut all them.

Oliver Letwin: We have to cut back on the bureaucracy.

Jeremy Vine: Right. So you've got lots of money and then cut taxes. You can promise that, can you?

Oliver Letwin: What I'm saying is if we freeze the civil service recruitment on day one, as we're committed to doing, if we save a huge amount of money by getting value for taxpayers by actually clobbering these vast bureaucracies. You know we have, at the moment we're spending two thousand million pounds a year on immigration and nationality system.

And a thousand million pounds of that could be saved by having a proper controlled quota based immigration system like in Australia, and if we were to do well then of course we could spend that extra money on five thousand extra police officers a year, which is what it would pay for over four years, and not raise taxes, not have Labour's third round of stealth tax rises ...

Jeremy Vine: (overlaps) You'd spend it on tax cuts. You wouldn't spend it on tax cuts.

Oliver Letwin: But of course Jeremy it's bound to be the case that if you save money by giving value for money, then you can afford not to raise taxes and as the economy grows, you can afford to move to being a lower tax economy and that's ...


Jeremy Vine: If I understand what you just said and I think I counted four 'ifs' there, you will take the money you save and plough it back and have even more spending, more than Labour.

Oliver Letwin: No. What we're saying is, instead of spending taxpayers money on useless things, for example to-day we announced that the Partnership Initiative budget, which is part of the community legal services, which is currently providing would you believe it, a help line for travellers, is not necessary.

Now if we cut out that kind of thing, then without raising taxes, as Labour will have to do, we'll be able to fund the public services properly and give us more police and give us those cleaner hospitals, and give us discipline in our schools, and because the economy grows, you can use the flexibility that gives you to produce a lower tax economy (overlaps)

Jeremy Vine: Right. Now you, your list there, the last item on it is tax cuts. Let's turn it around. You've said before there is a moral case for lower taxation.

Oliver Letwin: There is.

Jeremy Vine: What if you, as Chancellor say, the very first priority is to cut taxes, why don't you make that the absolute centre piece of your economic policy?

Oliver Letwin: Because we are determined to ensure that there are proper public services, and we're determined to ensure that the tax payer gets value for money. Now if you're getting ...

Jeremy Vine: (overlap) That's Labour's ground isn't it?

Oliver Letwin: If you're ... no. Labour has added three hundred thousand bureaucrats to the public service.

Jeremy Vine: But your colleague, Edward Leigh was saying, it's Labour's ground to say we'll spend as much as them.

Oliver Letwin: It, it's not Labour's ground to get value for money because they've been wasting taxpayers' money, hand over fist. We've got five thousand pounds extra per year, per family, in tax to pay, and five thousand people last year died of MRSA in our hospitals. That is not value for money.


Jeremy Letwin: Right, if you are so certain that all this money is sloshing around, there ready to be reclaimed by a more prudent chancellor, why can he not, with certainty, offer tax cuts.?

Oliver Letwin: We do aim to move to a lower tax economy

Jeremy Vine: (overlaps) You aim

Oliver Letwin: We're looking seriously at all the options for reversing the sixty six stealth tax rises there have been. We're costing those options, you showed some of them on your programme, very rightly. When it comes to the election, we'll make the tough choice which we have to make of our priorities, and we'll announce it.

Now everybody knows we don't have limitless room, but we will move in the direction of a lower tax economy, and we will stop Labour's next round of stealth tax rises, dead in its tracks by getting better value for money. I can't stress too much how much that phrase matters to us. We're determined that people shouldn't be paying all this money and getting nothing for it.

Jeremy Vine: Can I put it to you that what you're engaged in is actually the least honest course of action, because you are not making commitments, but you want the voters to hear what you're saying as a commitment. You're saying we're going to move in the direction of tax cuts, but you're not promising anything.

Oliver Letwin: Jeremy, I've said I don't know how many times that we're determined to get value for money. Now, the importance of that is that it's the only honest way that a government can reconcile two things that people rightly want: lower taxes and better services.

You've got to get better value for money if you're doing that. Do you know, we have at the moment, a hundred thousand soldiers in the British Army, and ninety thousand officials in the MoD servicing them? This is madness. We've got to get better value for money and if we do that, if we can show the public that we're going to do that through our value for money action plan, which we've been publishing bit by bit, and will publish the whole of in the New Year (interjection)

... Jeremy, we have to run a country and not play a game of electoral time tables. We're serious about the business of getting value for money, and we know that means work, and it means publishing the work when we've done it, and not before. And it means that when we're in government, from the first day onwards, we implement that value for money action plan, and that's what enables us to square the circle of better services, cleaner hospitals, school discipline, more police on the streets, with lower tax.

Jeremy Vine: And if you open the books, which you can't see in detail yet, and you find that there actually is even less money than you think, you may have to put taxes up. Right?

Oliver Letwin: I think we all know what the Chancellor is currently facing because the IMF and the OECD and the IFS, and the CEBR, and the INSR and all the other economists with all their wonderful initials, all say, that he's got a structural deficit, which they estimate at around ten billion pounds.

That is built in to our plans. We know that we've got to use the value for money we're going to get. The cutting away of the fat bureaucracies, and the waste in order to ensure that we don't have to raise taxes to fill his black hole, but my spending plans allow for doing better than that, and getting to a lower tax economy. We're determined to move in that direction.

Jeremy Vine: Oliver Letwin, Shadow Chancellor, thank you very much for joining us.

NB:This transcript was typed from a recording and not copied from an original script.

Because of the possibility of mis-hearing and the difficulty, in some cases, of identifying individual speakers, the BBC cannot vouch for its accuracy.

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