The Liberal Democrats have released their manifesto ahead of the upcoming general election, with leader Sir Ed Davey making claims that their proposed policies are “fully costed”. However, upon closer examination, it is apparent that there are some uncertainties surrounding the numbers presented in the accompanying costings document.
While the £27bn in additional spending is said to be covered by an equal amount in taxes and revenue raising measures, there are doubts about the feasibility of these plans. For instance, the party plans to raise £3.62bn through aviation tax reform, but do not have a concrete plan for how to achieve this. Similarly, their proposed tax on share buybacks is expected to bring in £1.4bn, but it is likely that companies will alter their behavior to avoid this tax.
Moreover, the party’s main revenue raiser is not a new tax, but rather an assumption that they will be able to crack down on tax avoidance to the tune of £7bn. While party officials are confident in this figure, it remains to be seen if their investment in HMRC processes will be successful in achieving this goal.
There are also concerns about the effectiveness of the party’s plans to address the asylum crisis, which is expected to generate £4.3bn in revenue. Experts question whether this policy will actually have the desired impact, and whether the promised increase in health and social care spending of £8.4bn will be sufficient to make a difference.
In addition, the party’s commitment to reaching net zero carbon emissions by 2045 – five years earlier than the current target – is accompanied by a surprisingly low investment of only £8.4bn. This is a significant decrease from their previous pledge of £86bn in 2019.
While some may dismiss these discrepancies as minor details, it is worth noting that the party’s current manifesto is significantly less ambitious than the one presented in the last election. With spending plans of only half the size, it is clear that the Liberal Democrats have either adapted to the current economic climate or have shifted their priorities since then.