Greg Smith is the MP for Buckingham. Dehenna Davison is MP for Bishop Auckland. They are co-chairs of the Free Market Forum.
Of Boris Johnson many successes, his ability to sell the Conservative message to members of the public who had hitherto never considered voting for our party is among the most impressive.
During the 2019 general election, Conservative candidates who were “doing their time” by standing in unwinnable seats quickly came to realise voters were developing a healthy appetite for low taxes and Conservative economics – for the sunlit uplands of opportunity that could come from ‘taking back control’ – both of our national policies and of their own lives.
Since the election the Government has, of course, devoted most of its time towards the two overriding issues of Brexit and Covid. These have prevented it from undertaking the type of free market policies that many of we newer MPs might have wished for.
It was of course right for the state to step in and protect lives and livelihoods during Covid, and it may have been necessary for the government to simply replicate large tracts of EU rules initially in order to give businesses some certainty during the immediate transition from EU membership to full independence. But with a Brexit deal done and Covid believed to be endemic, it is time to consider what comes next.
The Free Market Forum aims to promote ideas and stimulate discussion over how we make Britain economically and socially freer, boosting the economic opportunities and growth across the nation, encouraging innovation and creating jobs. We want to lead the conversation within the Conservative Party on the importance of retaining the traditions of fiscal prudence, low-taxes, and limited regulation – key pillars to support growth and opportunity.
For many in left behind parts of the country, the reality is that the private sector is stifled by a bloated public sector that is almost Soviet-sized in some areas of the North. Thirteen years of Labour – whose ambition seemed to amount to little more than throwing money at those left behind and hope for the best – was followed by little change from by well-meaning Conservative governments since 2010.
This has meant that for decades, many of our communities could not even begin to imagine a world where they could succeed through entrepreneurism or seizing opportunities for themselves, rather than just waiting for the state to do it for them.
Innovate UK polling indicates that the confidence to start a new business, for example, is far lower in left behind Britain than in the more affluent parts. In the North East, a shocking 44 per cent of those with an idea and desire to start a new business lack the confidence to take the plunge and go for it (compared to less than 30 per cent nationwide). Clearly, restoring a culture of risk is needed if we are going to help these places succeed.
Our new paper, 30 Ideas for 2030, is our first effort to dip our toes in the water. The 30 ideas – from MPs, peers and respected academics – cover a broad swathe of policy areas, from reducing occupational regulation to reforming the BBC, from using technology to enhance teaching in our classrooms to removing the barriers to self-employment and alternative business models. While not a policy prospectus, we are hopeful that these options for cutting the state and instead empowering the individual will provide some food for thought in government.
As you might expect, considering the almost historic levels of taxation as a proportion of GDP and a state that seems to be growing ever larger, many of the ideas revolve around tax reform.
The former Chancellor, George Osborne, dubbed our tax code “one of the most complex and opaque tax codes in the world” on assuming office in 2010. Yet a decade later we still have, at over 10 million words, the longest tax code in the world, 48 times the length that of Hong Kong – which is considered to be the gold standard by most tax accountants. This tax complexity results in dozens of loopholes and offsets which reduce government income and also distort the economic activity of both businesses and individuals.
Taxes should be as low as possible, but it is equally important that they should be simple and universal.
With our economy still weak from the Covid lockdowns, and considering the additional tax burden the government is now choosing to add on to National Insurance, we should be scrapping the planned increase in Corporation Tax and looking to simplify the tax system more broadly. Other tax reforms which should be under consideration include the wholesale abolition of Stamp Duty Land Tax, which, alongside prudent free market reforms to planning regulations, could do much to alleviate the worst of our housing crisis and get more young people onto the property ladder.
There is much to do over the next ten years as we build back better following Covid. But it is only by embracing freedom and economic liberalism, and continuing to make the case for it instead of becoming an increasingly paternalistic, state-controlled nation by default, that we will make a real difference to those left behind, and make Britain a richer, stronger country.