Time to shrink the state?

Forget tax cuts. They're like, so last week.  Spending cuts, that's where the action is. 

Now that David Cameron has belatedly realised that his embarrassing right-wing colleagues actually had a point about Labour's spending plans all along, the focus will surely shift to where fat can be trimmed from the public sector.

Not that the Tories should expect to have this fame all to themselves. In fact, I'd bet on Labour offering its own promises to squeeze the state fairly soon.

One minister tells me that she and a number of her colleagues have already started quietly reviewing their various departmental programmes and schemes to see what can be frozen, what can be postponed and what can be junked altogether.

"It's all very well to talk about investing in schools and hospitals, sooner or later, voters are going to start looking at the public sector and wanting to know why it's not feeling the pain as well," the minister says.

And Alistair Darling is openly talking about the need for Government to "tighten its belt" during the tough times ahead.

So, expect some sort of new Gershon Review in next week's Pre-Budget Report, probably a updated re-announced version of the Operational Efficiency Programme the Treasury came up with in July.

PS

This is all very nice of course, but it's worth remembering that cuts in spending are easy to promise and devilishly hard to deliver. No matter how many times you try to kill them, public sector jobs and projects have an almost unnatural ability to come back from the dead.

Here's a nice example of how hard it is to say just how many real Whitehall cuts have resulted from Gershon. How many civil servants has the Home Office sacked under the Gershon plans?  The official answer: dunno.

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