The Public Services Conundrum

How is it feasibly possible to have low taxation and yet good public services? 

Money has to come from somewhere to fund public services, but low taxation reduces the overall tax take by central government. Yes, a burgeoning economy means a larger tax take, from which a good percentage can be allocated to public services, but a continually burgeoning economy is very rare - eventually there will be a recession, or a period of stagnation. Only Australia has had a continually growing economy - 27 years at the last count, but even that was only at 3.3% on average and the tax rate there is only marginally lower than the UK for someone on say £30,000.

One way of a government having low taxation without having to worry about the impact on public services is to sneakily offload public services to local government - low taxation by subterfuge. However, this will lead to an increase in local taxation, as well as huge variations in the quality of those public services, depending on the wealth of the locale. 

Imagine a situation where a wealthy borough has excellent medical and education services, while a poor, inner city borough has inadequate health and education services. Not only that, but any benefits of scale are immediately wiped out, resulting in higher overall costs.

I fully expect our Conservative government to announce such a proposition before the GE....