Britons say no to smaller state (BSA 30)

By Colin Talbot, University of Manchester

Britain is still a majority social-democratic country. That is, politically, the most significant finding of the latest British Social Attitudes survey published this week. Most people want a country which “gets and spends” about what we do now, or even more, rather than less. The BSA figures seem to contradict the often heard assertion that the British people want Scandinavian levels of public services for American levels of taxes.

How do we judge how “social” democrat, as opposed to “liberal” democrat, a country is? The most telling test is how much people are willing to have collected in taxes and spent on public services and welfare provision.

Britain, for the past 50 years or more, has lain somewhere in the mid-Atlantic in terms of actual tax and spend. Our average spend, as a percentage of GDP, has been just under 43% – roughly midway between American and continental European levels.

The supposedly radical, “rolling back the state”, government of 1979-97 managed to “roll back” public spending to an average of 43.5% – very slightly up on the long-term average.

The “high-spending” New Labour government of 1997-2010 was nothing of the sort, seen in this historical perspective, at least until the onset of the Global Financial Crisis and “Great Recession” in 2008. Gordon Brown actually managed to get public spending down to its lowest level in the past five decades – below 37% of GDP – in 1998. Labour’s average, even including the GFC impact, was only 40% of GDP, and had stabilised at about 41% of GDP, just below the long-term trend rate before the GFC hit.

The British Social Attitudes Survey data go a long way to explaining this trend. Since 1983 they have been asking the same question every year – given a choice between these three options, which would you choose:

  • Reduce taxes and spend less on health, education and social benefits
  • Keep taxes and spending on these services at the same level as now
  • Increase taxes and spend more on health, education and social benefits

Throughout this period the “smaller state” option has never risen above 10%, with around 90% preferring the state to remain the same size or even grow.

Some voices on the right of British politics have been calling for “American” levels of tax and spend (about a third of GDP) since the 1970s. Think tanks on the right, like the Adam Smith Institute, Institute for Economic Affairs and more recently Reform have been banging on about this for years – and in more recent years they have been joined by the “Orange Book” Liberal Democrats.

Attitudes to tax and spend, 1983–2012 British Social Attitudes Survey 2013

The BSA figures help to explain why advocates of this radical right, “liberal democratic state”, position have failed to get anywhere near achieving their goal: the political obstacles are enormous. And in any case, public spending at these sorts of levels is now so embedded in the economic fabric that any radical reduction would have very disruptive effects on both public and private sectors.

The real fluctuation – as the BSA figures show – has been between the state should stay about the “same” size, or that it should get bigger (the “more” option).

The BSA analysts suggest that this fluctuation is “thermostatically” linked to changes in fiscal trends; when the state was perceived as getting “too small” in the late 80s and early 1990s, the tax and spend more group grew.

Long-term Public Spending Trends (% GDP) HMT

By the mid-2000s, after New Labour’s rapid rise in public spending between 2000 and 2005, the “same” and “more” scores reversed. Now over 50% wanted tax and spend stabilised, and that is in fact what happened in the 2004 Spending Review.

Of course there have also been important other shifts in public opinion suggest. Welfare, and especially unemployment, benefits have become markedly less popular when people are asked specifically about them. But overall there has clearly been no dramatic shift to a “smaller state” attitude amongst the British public, however much the current coalition government might wish it otherwise.

Colin Talbot does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

The Conversation

This article was originally published at The Conversation.
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4 thoughts on “Britons say no to smaller state (BSA 30)

  1. I would like to see some international comparisons to see if most populations are conservative on this subject ( ie want to stick with the system they know).

    On another point, you chart shows that public spending varies quite widely in relation to GDP. I think the anchor is revenue where there seems an unstated ceiling of 39% ( you may get above it for a year in a boom but you can’t or won’t be allowed to keep it there). Is this a form of revealed preference of the electorate?

  2. Dear John,

    On your first point – I’m not sure if there are any comparable longitudinal surveys in other countries that asks the same (or a similar) question. Good question. I will investigate. But it doesn’t alter the political implication that any ‘small state’ political agenda is going to find it hard to get real traction unless the recorded attitudes change substantially.

    On your second, the ‘problem’ with this BSA question is that it does combine tax and spend, which is a valid thing to do, but where they are asked separately you do get different results. And the real outcome has been, as you say, an on-going ‘structural deficit’ between income and spending of somewhere between 3-5% of GDP which has persisted for decades. The effects on debt have of course been mitigated by inflation and growth, but the 40% ‘glass ceiling’ for tax does seem to be a real effect. Back in 1995, in a Demos pamphlet, Geoff Mulgan and Douglas Hague (from opposite sides of the political divide) proposed a spend limit of 40% of GDP based on this long-term income trend I think (although to be fair, Geoff Mulgan now disowns this publication!) .

  3. My sympathies lie with the sentiments expressed above – although from a slightly different perspective Paul Whiteley’s most recent book offers the view that the trend overtime is one in which individual perceptions of what is expected from government is declining. [The data is below – although formatting is a little jumbled]

    Changes in Perceptions of Government Responsibility 1985-2006
    Government definitely should do the following:
    [Dates are 1985, 1990, 1996, 2006]
    Provide healthcare for the sick 86 85 82 71
    Provide a decent living standard for the old 79 78 71 60
    Impose strict laws to protect the environment _ _ 62 48
    Provide financial help to students _ 49 37 34
    Keep prices under control 61 49 42 32
    Help industry to grow 54 43 40 29
    Reduce income differences between rich and poor 48 42 35 27
    Provide affordable housing _ _ 62 48
    Provide a job for everyone who wants one 38 24 28 17
    Provide a decent living standard for the unemployed 45 32 28 11

    Source: Whiteley (2012:12)

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