Britain’s Leader Carves Identity as Budget Slasher

By JOHN F. BURNS

Published: July 20, 2010

LONDON — In the five years David Cameron spent rebuilding the Conservative Party in opposition, opinion polls showed that as he sought to rebrand it by offering a compassionate but persistently fuzzy image, voters had trouble defining what sort of a prime minister he would make.

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Suzanne Plunkett/Reuters

Prime Minister David Cameron of Britain with Lady Thatcher, one of his Conservative predecessors, in London last month.

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Not any longer.

After 10 weeks in office, Mr. Cameron, who met with President Obama in Washington on Tuesday, has emerged as one of the most activist prime ministers in modern times, rivaling in some respects even Margaret Thatcher, the “Iron Lady” who as the Conservative leader in the 1980s attacked unions and government bloat while privatizing national industries and vigorously pursuing free-market policies.

With a relentless battery of policy announcements, Mr. Cameron and his coalition of Conservatives and Liberal Democrats have proposed to couple the deep deficit cuts the conservatives sketched out during the May general election campaign with a wider effort to break the mold of big government in Britain that, despite Lady Thatcher’s best efforts, has largely prevailed since World War II.

In so doing, they have charted an economic course of almost savage austerity, an approach that contrasts starkly with the policies of Mr. Obama, who wrote to Mr. Cameron and other leaders last month warning against premature cuts in government spending that might drive the world into a double-dip recession.

Mr. Obama has chosen a different path for the United States, deferring the kind of sharp budget cuts now being rolled out across Europe, and at his meeting with Mr. Cameron the two leaders, in effect, agreed to disagree.

In a radio interview with NPR before going to the White House, Mr. Cameron expressed his viewpoint diplomatically. “Every country has to deal with its budget deficit, but the time at which we do it can vary,” he said.

And vary significantly, as Mr. Cameron’s government has shown. A budget last month proposed an austerity campaign of extraordinary severity, setting across-the-board cuts over the next five years of 25 percent and more. But that has proved to be only the scene-setter for an ambitious — and politically risky — bid to dismantle Britain’s sprawling bureaucracy. If successful, it will lift what the new leaders say is the state’s heavy hand on public life, restricting its reach into schools and hospitals, slashing welfare benefits and reviewing intrusive law-and-order Labour programs that have alarmed advocates for civil liberties.

At 43, Mr. Cameron is Britain’s youngest prime minister in nearly 200 years, and he appears to have surprised even himself. As opposition leader, he developed a reputation for blandness, but all that changed after the May 6 general election, when the Conservatives’ cautious, middle-of-the-road campaign failed to win the outright majority many had thought was theirs for the taking.

To achieve a parliamentary majority, Mr. Cameron reached out to the Liberal leader, Nick Clegg, and the two men vaulted ahead of their parties by drawing up a plan for a radical reshaping of the way Britain was governed.

Their proposals for slashing spending go beyond anything Britain has experienced in its modern history, even under Lady Thatcher. They sharply reverse course from a Labour government that, for 13 years under Tony Blair and Gordon Brown, expanded the state’s power at a pace never seen outside of wartime, turning Britain into one of the most heavily taxed, tightly regulated countries in the developed world, with government accounting for about half the work force and half of the economy.

So far, the course charted by Mr. Cameron and his deputy prime minister, Mr. Clegg, remains largely visionary. At best, they face months, and potentially years, of slug-it-out battles with opponents, including skeptics in their own parties, as well as with newly restive labor unions and a recalcitrant bureaucracy. Their austerity drive alone could bring the coalition down, if people like Mr. Obama who fear that budget-slashing could drive economies like Britain’s back into recession prove to be right.

The main hallmark of the coalition’s program is a plan to halve the annual budget deficit of $235 billion within five years, and to achieve that by across-the-board cuts in almost all government ministries. All the departments involved have been told to prepare a plan for cuts as high as 40 percent, and some may have to cut much deeper than others to compensate for high-spending ministries like those responsible for the military and for Britain’s $290 billion annual welfare outlays, which are unlikely to make even the 25 percent reductions.

The National Health Service, while protected from cuts, has been ordered to shed thousands of jobs. The coalition’s plan is to hand real power — and 70 percent of the health budget — to general practitioners, who, in the coalition plan, would decide for the first time in the health service’s 60-year history what kind of treatment patients would get, and where they would get it.

In a bid to lift some of the poorest standards for literacy and educational achievement in Europe, parents are to gain wider powers to establish so-called academies, independent but publicly financed schools in which head teachers and their staff would be freed from the stifling oversight of local councils and the central education authorities.

A system of legal aid that is one of the world’s most expensive would be slashed, with deep cuts in lawyer’s fees and cases that could be paid out of the taxpayers’ pockets, including divorces. The BBC, financed by $5.3 billion in license fees paid by everyone in Britain with a television set, faces deep cuts as the coalition considers reducing the $220 annual license. Tens of thousands of government workers are likely to lose their jobs, and those who stay are likely to face a two-year wage freeze and potentially sharp pension cutbacks.

In a country with eight million long-term unemployed people, the coalition plans savings of tens of billions of dollars in welfare payments, including radical cuts in the rent the government would pay for subsidized housing. After newspaper accounts telling of immigrant families receiving more than $150,000 a year in taxpayer-paid rent to live in large houses in some of London’s most fashionable districts, the coalition has said that it will place a cap of $600 a week on such payments.

A catalog of laws and practices that advocates of civil liberties have deemed intrusive are to be reviewed. These include 28-day detention orders for people suspected of terrorism, a Labour plan for national ID cards, and the wide use by the police and other enforcement agencies of an elaborate network of closed-circuit television cameras.

Weakened and divided by its May election defeat and temporarily rudderless as it awaits the election this fall of a new leader to succeed Mr. Brown, Labour has resolved to halt many of the changes by all means possible. In the short term, that points to a new and prolonged season of labor unrest, particularly by public sector unions.

Beyond that, Labour has said it will work to ensure that the new coalition is a one-term government, doomed to defeat in a popular backlash in the 2015 general election — and doomed much sooner if strains already showing within the coalition widen to the point of collapse.