In praise of the IFS

In my annual lecture I spoke about the need to create a 21st century public sphere, a modern equivalent of the flowering of new spaces for discourse and civic invention which took place in the eighteenth century Enlightenment.

This was a time which saw the opening of coffee houses where the growing middle class could talk about philosophy and current affairs, the creation of learned societies like the RSA, and the emergence of mass publishing, especially in the form of newspapers.

I am developing ideas for debate, research and development around the goal of new institutions for a new public sphere, and of course, we walk the talk by working with FRSAs to change the ethos of Fellowship. (By the way, I was delighted to see that this month we have again another good crop of applications for RSA Catalyst, our seed corn fund for Fellows’ projects.)

An important challenge in the cultivation of a new public sphere is creating institutions which can be seen to be putting social purpose ahead of organisational self interest. Too many organisations which claim to act in the public good are prone to self indulgence, special pleading and empire building. Whilst the third sector contains great organisations held together by the commitment, courage and creativity of amazing people, it also features producer-captured bureaucracies who go to great lengths to avoid searching questions about their own effectiveness.

In the think tank sector one organisation stands out as a beacon. The Institute of Fiscal Studies is well-managed, well respected, and – most important of all - fearless of Government. In the early says of New Labour, when everyone was genuflecting to ‘The Project’, Andrew Dilnot’s IFS was one of the first organisations to ask hard questions. I remember them pulling apart the first comprehensive spending review and Gordon Brown’s misguided tactic of rolling up several years spending in a single impressive figure. Brown’s people were furious and there was a concerted, but thankfully unsuccessful, attempt to threaten the Institute’s funding and undermine its credibility.

Now the IFS is back at it again. Under the splendid leadership of the razor sharp, eloquent and dapper Robert Chote, it has swum against the tide of fawning to the Coalition to expose the less than fully honest Budget briefing.

In response to the Coalition’s claim that the budget measures are redistributive, the IFS has pointed out that: first, this is largely because of the inclusion of measures already announced by Labour (particularly the 50 pence tax band); second, measures whose effect cannot be fully predicted (like housing benefit caps) will almost certainly impact hardest on the poor; and, third, future deep public spending cuts are again most likely to hit the poorest hardest.

Many Conservatives will be relaxed about this making the case for discouraging welfare dependence, protecting the ‘squeezed’ middle classes and maintaining incentives for enterprise and risk taking. But the IFS analysis must be very uncomfortable for the Liberal Democrats.   

I suspect that if any other organisation has made these criticisms (particularly had they been linked with Labour) the Treasury would have been quick and aggressive with their rebuttal, but so sound is the reputation of the IFS that any attempt to rubbish its analysis could be deeply counter-productive.

The IFS is a great British institution. It has established its unparalleled authority through years of high quality analysis by sticking to what it does best and a willingness to say what needs to be said, regardless of the reception it receives.  I take my hat off to it.