Alistair Darling is launching an attack on the Brown-Balls “spend, spend, spend” dividing line election strategy and the continued deficit denial of Ed Balls. Remember that at one point before the election Gordon Brown tried to replace Alistair Darling with Ed Balls because of his resistance to total fiscal insanity.

Darling is giving the Donald Dewar Memorial Lecture at the Edinburgh Book Festival today and will say that

“Labour lost because we failed to persuade the country that we had a plan for the future. What is important now for our party is we take stock and be honest about what went wrong.

“We rather lost our way. Rather than recognising that the public were rightly concerned about the level of borrowing, we got sidetracked into a debate about investment over cuts.

“By failing to talk openly about the deficit, and our tough plans to halve it within four years, we vacated the crucial space to make the case for the positive role government can play.

“You will only convince people you’ve got the answers if they believe you know what the question is in the first place. You can’t have political credibility without economic credibility.”

At almost the same time Darling’s successor George Osborne will be delivering a very similar message, he will attack Brown’s claim to have ended boom and bust, calling it “the greatest failure of economic policy-making for more than 30 years, since the IMF crisis of 1974“. He will tell analysts at Bloomberg’s City HQ that the “deficit deniers” are “taking the British people for fools”. Balls may be the worst and most explicit deficit denier, but none of the Labour leadership candidates has much to say about the fiscal crisis they created.

Eric Pickles is busy explaining the practical business reasons why the Audit Commission is being killed off. Undoubtedly the organisation had, under New Labour, long ago moved on from being austere bean counters to doing politicallycorrect box ticking exercises, costing unnecessary millions. That is when they weren’t treating themselves to massages or a day at the races at our expense…

Guido suspects that the decisive moment when the fate of the Audit Commission was sealed was before the election when it became public that £56,000 had been paid to spin-merchants Connect Public Affairs to advise them on how to save their overpaid jobs. Connect recommended an expensive

“strong local lobbying response in order to mitigate and combat the activities of Eric Pickles”

Suicide by spin…

Looking down Connect’s list of mainly public sector and trade union clients it provides a handy guide to organisations that are clearly finding it difficult to justify themselves on their own merits, so instead they throw thousands of pounds of taxpayers’ money at spin merchants to do it for them. Quite a few more targets on that list merit defunding by the taxpayer…

Last night John Redwood flummoxed Kirsty Walk on Newsnight (here) when he said that the government was not cutting public expenditure. She didn’t really know where to go with her line of questioning since it was so off her script. The BBC weltanschauung is that we will soon be seeing massive and terrible cuts in government spending which will provide endless material of the grinding down the poor and vulnerable kind for them.

The truth, as Redwood points out, is that the government is still planning on spending rising every year, government debt will continue to rise year-on-year and the deficit will not be closed even in 2015. The unfunded overspending will be restrained in comparison to Gordon Brown, but will continue regardless. This government will continue to spend more than it receives and the budget will not be balanced. There will be no overall cut in spending…

£50m is not a trivial amount, it is the amount taxpayers spend on free milk in schools. Winston Churchill once said

“There is no finer investment for any community than putting milk into babies.”

It doesn’t make political sense to cut this expenditure, it will evoke “Maggie Thatcher, Milk Snatcher” memories. As keen on deficit cutting as Guido is, and at the risk of being expelled from membership of the Taxpayers Alliance, this seems too full of potent symbolism to be given a priority. Mike Smithson suspects it is a ruse, only floated to be given up as a public concession to LibDems who are getting squeamish at the sight of blood from the coming cuts.

If it is, it is too clever by half…

The scale of the dependency culture is daunting, the problems are like the heads of a hydra. Fatherless kids and dysfunctional families with chaotic workless lifestyles, their dependence on welfare transfers from the productive, working classes, creates huge problems. Children from these broken backgrounds are failed by the bog standard schools which should offer them a path to betterment. Social mobility has been destroyed in the name of educational egalitarianism.

It is bad for those who are dependent themselves and no society should tolerate cities where a quarter of the population is without work and dependent on benefits. Fraser Nelson charts worklessness by City:

Guido wishes IDS well with what is, along with Gove’s education reforms, a policy agenda as important as cutting the deficit. The Left will try and undermine the agenda case by case, but it has to be seen holistically. Labour failed in 13 years to tackle the problems, Blair realised this by his third-term, too late to do anything about it.  It has to be made more attractive to come off benefits and into work, IDS is right to worry about the disincentives to work and the marginal rates of taxation for those in the welfare trap.  The truth is that we need to also chip away at the “Shameless” culture that makes it acceptable to be permanently on welfare. The judgement on whether or not the Coalition fixed society will depend on how much they reduce the number of welfare dependants.

How do bureaucrats save their jobs? They re-invent themselves as green advocates. You can imagine Sir Humphrey explaining to the minister that instead of sacking a few dozen burdens on the taxpayer, he can redeploy them as green advocates. It’ll cost more, but it’ll be green…

When is a quango not a quango? When it is an “Office”. In this case the new Office for Low Emission Vehicles (OLEV), “a cross Whitehall team dedicated to taking forward” green initiatives. So far the only initiative they have come up with is a £50 million taxpayer subsidy to middle and upper-class greens who can get £5,000 off the purchase of an expensive electric car. That £5,000 will end up directly in the profits of foreign electric car manufacturers.

The Foreign Office now has a Climate Change twitterer, no really. We are supposed to be getting small government and a Big Society. We’re actually getting a Big Green Government…

Eric Pickles has been getting under the skin of his shadow John Denham with digs about the £2.78 million spending spree on furniture, redecoration and suchlike that his former Dept. of Communities and Local Government splurged before Labour was booted out. Pickles had a heydey in the press and parliament with tales of Harriet Harman’s multi-million pound “Serene Green Tranquillity Room” at the Equalities Office.  Denham wasn’t going to let that happen to him.

Denham’s SpAd, Jake Sumner, knew where the bodies were buried and in a spirit of comradeship FoI’d confirmation that it was Yvette Cooper, the former chief secretary to the Treasury, who approved the spending in a letter of 2 June 2008 to the then Secretary of State, Hazel Blears, Denham’s predecessor at the Dept. of Communities and Local Government. So it was Yvette, not Denham, who authorised the purchase by Hazel of £134,503 of red sofas. Presumably chosen to match Hazel’s hair…

Listening to the BBC or reading left-wing newspapers and blogs would lead you to think we were about to suffer shock-doctrine economics at the hands of the Coalition requiring martial law to enforce.  The fact is that at the end of this parliament government spending will be up another 9%.

The public sector is merely looking at below inflation spending increases, but increases nevertheless. There are not going to be across the board spending cuts, there is going to be a re-prioritisation of resources, with slower overall spending growth. George Osborne is no Pinochet…

Incidentally it could be worse, in Obama’s United Soviets of America the White House is planning (Brown-style) to maintain 10% deficit financing next year. Within a generation the White House itself is predicting a 25% deficit. Which means Greek style bankruptcy…

Danny “Beaker” Alexander (pictured), the newly appointed Chief-Secretary to the Treasury, is the man charged with swinging the spending cuts axe, enforcing a public-sector pay freeze and sacking quangocrats.

It has to be done to bring down Labour’s deficit and tackle the government’s debt crisis – Britain’s deficit is second only to that of Greece.

The Coalition has been spinning that they are taking a 5% cut in ministerial salaries, which sounds very noble, setting an example and leading from the front, except when you realise that every single one of them will see their income rise.

Take the example of Danny Alexander, he was on an MPs’ basic pay of£65,737 before the election, a month later he is on £134,565, a whopping 104% pay rise.  Not exactly suffering personally under the new austerity regime he is supposed to enforce is he? Are we really “all in this together”?

He would argue that following his promotion he has additional responsibilities, but do they justify more than doubling his pay? Is he working twice as many hours? Who (besides a politician) would argue that a lucky promotion justifies doubling your pay?

We are told that the Treasury is going to release a document later today designed to produce a “fundamental re-evaluation of the role of government”.

It will ask people to discuss whether the government needs to provide certain public services at all and whether someone else such as councils, voluntary organisations or companies, could do so more cheaply.

There are a lot of things the government does, supposedly on public health grounds, that are massively unpopular:- raising booze taxes such that a pint costs £5 of taxed income and the brewer is lucky to see a pound.  Guido thinks adults should make their own health choices. My guess is that they will ignore the the sound of the crowd, nevertheless, shall we give it a try?