Unsurprisingly, in response to the dreadful state of public finances, David Cameron has promised an age of 'thrift' if brought to power.

However, his polices (though welcome) are still somewhat thin on the ground:

• shame overpaid civil servants, with a "people's right to know" scheme
• publish all items of public spending over £25,000 on a website
• publish all public sector salaries over £150,000

Cameron is at present focusing on the clearly evident problem of government waste, and of course a ‘Phibbs List’ approach to all areas of government would be very welcome; however, in truth a peek here shows that without radical reform, the public purse will stay firmly in the red indefinitely (with or without tax rises). Principally, pensions and health care need structural reform if the overheads of government are to be cut back.

The next government needs to be reminded of the proven benefits of free markets. As Milton and Rose Friedman argue in their classic book Free to Choose, there are only four ways to spend money:

1. Spend money on yourself
2. Spend money on other people
3. Spend other people’s money on yourself
4. Spend other people’s money on other people

Now you don’t need to be an economist to know which is the most efficient.