We need a much smaller state, not an even bigger one None of this includes the cost of other major projects such as high-speed rail and energy investments to prevent the lights from going out. Wherever we look, there is immense, pent-up demand for higher spending; this will eventually prove irresistible to whoever is in power. If unchecked, the state's size could rise by 5pc to 6pc of GDP on the rosiest of scenarios and most likely by 10pc to15pc. To allow this would be madness. We need a much smaller state, not an even bigger one. No political party is telling the truth: sooner or later, the welfare state as we know it will become unsustainable - and keeping it on life support for as long as possible, trimming on the margins while taxing until the pips squeak will only plunge us into a vicious spiral of decline. What we need is a drastic new programme of cuts, accompanied by a radical restructuring of the way key services are financed, delivered and managed. There are various ways this could be achieved - but here are my own 10 favourite ideas ahead of next week's spending review. Some would help shrink today's deficit; others address longer-term challenges. First, the easy one: George Osborne must set up a commission on public spending. Paradoxically, this body needs to have a decent budget to hire consultants and accountants to plough through all public spending, uncovering as many savings as possible, waging war on non-jobs, waste, poor contracts, restrictive practices, duplication and useless expenditure. Prizes should also be offered for money-saving ideas from within the public sector. Next, the Government needs to be remodelled. Councils would benefit from economies of scale by merging, if not entirely then at least their back offices. In a paper for the Free Enterprise Group, Dominic Raab, the Tory MP, wants to merge or abolish a number of Whitehall departments, cutting the total from 20 to 11 and saving £8bn a year. Subsidies to business, green energy, the arts, foreign aid and pseudo-charities should be slashed. Eventually, a shift in the UK's relationship with the European Union would allow additional savings in our contributions to Brussels. The TaxPayers" Alliance's latest Bumper Book of Government Waste lists many projects and areas that are ripe for pruning. There should be further cuts to benefits and welfare reform. The richest 10th of households are in receipt of almost £5bn in cash benefits a year, according to Mike Denham's Burning Our Money. The think-tank Reform puts the cost of middle-class welfare at £31bn a year. Prosperous pensioners should not be getting free TV licences or treated better than the rest of the public. The Coalition has improved the way the Government purchases supplies, but more is needed. The Institute of Directors recommends centralising buying to manage key relationships and contracts. There should also be increased tendering: by law, anything that can be provided more cheaply by the private sector should be contracted out, albeit with proper, tight contracts. This could save billions. It is also time for a further 10pc cut to all non-frontline public sector staff numbers, new contracts to boost working hours and productivity, the end of national pay scales and another two years of genuine pay freezes. In the interest of fairness as well as fiscal prudence, the aim must be to eliminate the pay gap with the private sector, which sees state employees paid significantly more on average. Their pension contributions also remain insufficient to fund liabilities, which must be rectified. The private sector should build all new airports, rail links, motorways and tunnels, charging consumers; private firms should be allowed to develop shale gas and other kinds of commercially viable energy, with subsidies for other kinds of electricity phased out. As to pensions, the sensible solution is to ditch the triple-lock, raise the retirement age to 70, starting as soon as 2030, and move towards an Australian or Singaporean-style system where people save for their own retirement. The new National Employment Savings Trust (Nest) system could be used as a starting point. We also need to get more for less in education. That means taking all schools away from local government control, increasing parent choice and allowing for-profit companies to set up and run taxpayer-funded schools more efficiently. Technology needs to be used to boost productivity, with increased online learning co-ordinated by teachers. Most controversially of all, the only way we are going to spend more on health without bankrupting the state is to encourage the public to pay more itself, as already happens in almost every other country. We need a European-style, insurance-based universal health system, with co-payments by those who can afford it and much greater private provision. Everybody should have access to high quality health care, regardless of ability to pay, but it will no longer be possible to provide it all through the NHS. The UK is facing a terrifying public spending time bomb, and our mismanaged, sprawling government needs radical reform. Trimming waste isn't enough: now is the time to start thinking the unthinkable about what functions we want the state to perform in the years ahead.