A CHILLING vision of Britain in the decade ahead is revealed in a leaked Treasury report today.

The pundits visualise a nation that has virtually shut down the welfare state and is destined to become poorer than countries like India, Thailand and Mexico.

Thus they foresee that the grim realities of what the country can afford will have forced it to scrap state support for the education of children over 16.

It will also have handed over its road system to the private sector.

More worryingly, they see that we will have privatised the welfare state so that people will have to take out their own insurance cover for pensions, sickness and unemployment. And even the state benefits that are left might be reduced and time-limited.

The first thing that needs to be said about all this, of course, is that it is guesswork.

The Treasury officials responsible for it are only fulfilling the obligation of government to plan ahead.

However, this is also guesswork with a distinctly radical tinge whose inspiration has evidently been the rightist conservative ideals of the Republican Party in America, whose agenda is for the greater dismantling of government and increasing self-reliance.

And it could seem that the authors of report have been listening to that tune and have added appropriate lyrics to it in the knowledge that it is what a Tory government, with basic anti-welfarist instincts, would like to hear.

But just how realistic is the guesswork and what potential has it for becoming policy?

As a vote-catcher, it is a loser.

The electorate may not like paying taxes to fund an increasingly swelling welfare state, but neither does it want it reduced to a virtually non-existent safety net.

Nor does it want public services like higher education and roads becoming public utilities like water and electricity.

However, the report, for all its radicalism and government efforts to disavow it as a serious policy document, does follow the path that all major parties have been going down - that of looking at what welfare the country can afford in the future.

Thinking in this field is influenced by the so-called, but still-disputed, demographic time-bomb of a population with an increasing proportion of retired, longer-lived people putting such strains on the welfare system, particularly the state pension fund and health care, that the state, or rather those paying into the system, can no longer provide the resources.

Hence, the talking up of private insurance cover for old age, illness and unemployment and of incentives for people to acquire it.

But this, of course, also fits in with rightist "self-help" thinking on the need to curb the so-called benefits culture that is, for instance, alleged to deter people from seeking jobs and to have encouraged the single-parent explosion.

More worrying still are the forecasts of Britain's plunge down the prosperity league and the sense of inevitability about this trend.

This is demonstrated already by our country now being a government-encouraged host to inward investment from nations once regarded as way below us in the prosperity stakes.

But if that is the path down which we are headed then Britain in the years ahead, stripped on its welfare state, might have the look not so much of a faded superpower, but of a banana republic.

Fortunately, however, Treasury forecasts are notoriously inaccurate.

Converted for the new archive on 14 July 2000. Some images and formatting may have been lost in the conversion.