I woke yesterday morning to see Chancellor George Osborne on Breakfast TV announcing his plans to scrap child benefit for Higher Rate tax payers from 2013 – as detailed here BBC News – Child benefit cuts ‘tough but necessary’ say ministers
There’s been a lot of talk already about this (as one would imagine) – much of it focused on the anomaly of married couples earning just below the higher rate tax threshold being able to earn a combined income of over 80,000 without losing the benefit.
Personally I think that this is one anomaly that will be smoothed out – and not really worth getting uptight over. However there are a number of things that really puzzle me about this announcement.
What hits me straight-away is that although Mr Osborne repeatedly said that this move has got to be done urgently because things are so desperately bad, and if they had any choice they wouldn’t do it, but what with the state that Labour have left things in, we can’t afford to waste time, and we’re all on this together and I’m sorry but tough times call for tough solutions, and we’re all in this together, and it’s all Labour’s fault, but it’s really urgent, and we’re all in this together, yada yada yada … Despite all this it’s not going to be introduced for three years. Three years ? If it was really urgent they could do this next week.
So it’s not really urgent then – it’s something that can wait three years.
But what intrigues me more is exactly why the Tories are trailing a cut which will primarily hit families with a single wage earner in the lower reaches of the higher rate tax bracket. Just the kind of people by the way, who would be likely Conservative voters.
Now there are those towards the left of the political spectrum who’d rationalise this quite easily – don’t give money to relatively wealthy people – give it to the genuinely poor who need it more
There are those on the right wing who’d defend it as well – don’t nanny us, make the state smaller and allow people to make their own way in life, without contributing to the welfare of others unless they choose to, and without resorting to ‘big state’ support.
In Britain though my feeling is that we have rather more people who don’t go with either of those views. We have rather a lot of people who are somewhere in the middle. People who don’t think there’s anything wrong with turning a profit, doing well in their chosen profession or business and becoming relatively well off, but who equally don’t have a problem with the state being structured in such a way as to help ordinary people – whatever their earnings – during the times when they need it the most – not just when they’re in desperate need, but also at strategic points in their life where they are relatively more in need of a little help.
When we think of “National Insurance” – we tend to think of it as insurance against the disaster of unemployment or disability. Insurance can provide for other less drastic eventualities though – and can be a way of providing for the future benefit of our families – and the nation’s families.
This is put fairly well (by a Conservative mind) in this article on Conservative Home : George Osborne’s child benefit cut shouldn’t be permanent – thetorydiary by Paul Goodman (who I confess I have not come across before – I believe he’s the former Tory MP for Wycombe).
I don’t think this measure naturally appeals to many in any political party right now – though perhaps some of the more extreme libertarians in the Tory party like it. It could conceivably drive a lot of middle income voters towards Labour.
It could of course be justified as an “emergency measure” – except as I said at the beginning – it’s not ! – We’ll wait three years for this.
So I really don’t what the Conservatives are up to with this – I am suspicious of the Conservative tactics. I don’t think they’ll ever implement this cut in its current form, and I worry about what they will actually do instead. I usually go for ‘cock up’ over ‘conspiracy’ every time – but this time I’m not so sure.
Just a thought !
- Is this the coalition’s 10p tax moment? (newstatesman.com)
- Letters: Child benefit must be universal (guardian.co.uk)
- Child benefit changes ‘fair’ insists David Cameron (independent.co.uk)
- George Osborne’s child benefit plans make things awkward for Labour (guardian.co.uk)
- Benefits feel the squeeze – but the City doesn’t (independent.co.uk)
- Child benefit row: David Cameron holds out promise of tax credits for couples (telegraph.co.uk)
- Top earners to lose child benefits (independent.co.uk)
- Top earners to lose child tax credit benefits (independent.co.uk)
- George Osborne: good cop and bad cop in one (economist.com)
- Ten policy headaches for the government on child benefit (leftfootforward.org)
- PM facing child benefit criticism (bbc.co.uk)
- Time for Ed Miliband to speak up on child benefit (newstatesman.com)
- Child benefit plans could be revised, says Children’s Minister (telegraph.co.uk)
- Tory right warns George Osborne over child benefit curbs (guardian.co.uk)
- Cameron faces criticism over child benefit cuts (guardian.co.uk)
- Government set to introduce tax break for married couples (guardian.co.uk)
- Tories raise alarm as George Osborne ends child benefit for all (guardian.co.uk)
- George Osborne’s patriot act (blogs.telegraph.co.uk)
- Osborne buries universal child benefit (newstatesman.com)
- Conservatives scrap child benefit for high earners (guardian.co.uk)
This headline from the Telegraph was quite widely trailed on Twitter today : Pound falls after Nick Clegg’s election debate success
Now admit it – looking at that, I’ll bet you thought that the currency markets had gone into free-fall, worried at the prospect of a Lib-Dem dominated hung parliament.
There might be the odd one of you that thought, hey Nick’s a nice guy, but if it’s going to send the City into turmoil, then I’ll stick with the Tories.
Well that’s just what the Telegraph wanted you to think.
Have a scout around and you’ll find that Nick Clegg’s apparent triumph (and actually I did think he came off best), and any fall in the value of the pound are in fact totally unrelated incidents.
How can I be so sure ?
Well mainly because the pound hasn’t nose-dived through the floor. Hasn’t lost all that much ground. In fact it’s been on an upward trend against the dollar since approximately the 25th March. Today’s fall of around 0.6% (representing less than 1 cent against the dollar, doesn’t really affect that trend. BBC NEWS | Business | Market Data | Currencies | Sterling GBP v US Dollar USD and in fact, at the time the Telegraph report was being read on-line by millions this afternoon, the pound was actually increasing in value against the Euro – although it finished the day slightly lower.
So all in all it’s been a relatively uneventful day for the pound – and whether it had gone up or down, it would have been nothing to do with Nick Clegg, Gordon Brown, or David Cameron.
Remember that the world doesn’t really revolve around financial traders, and never forget that democracy will always be far more important than a good day’s profit in the City.
So to the general public I say – Ignore the Telegraph’s silly scare stories – and vote for the candidate you think will do the best job.
And to the Telegraph, could I suggest you change your headline to “Millwall Crash against Huddersfield, after Cameron fails in Leaders debate” – it has after all got exactly the same cause and effect relationship as your original article, and a little bit more truth about it.
This morning I came across this image of the world, sent via Twitter. Yfrog – u6c – Uploaded by tjerubbaal
It intrigued me – it shows areas of the world scaled according to their overall Government debt, and coloured according to the debt as a proportion of Gross Domestic Product. It carried the caption from Twitter user @tjerubbaal “Truly disturbing image: are you paying attention @conservatives, @labour, @libdems? Tinkering won’t work.”
The poster is clearly not making a party political point – not between the three main parties anyway. Which is what intrigues me – because I feel quite strongly that the understanding of this issue, is at the heart of the difference between the Labour party and the Conservative party at the current time.
Forget about whether you understand the diagram or not – it’s not particularly easy to comprehend. Just know this – the debt which the country has taken on really is large – as @tjerubbaal points out – some might say disturbing. There’s no dispute amongst the political parties about that.
You could be forgiven though, if you’ve been reading the popular press, or listening to the Conservative election campaign, that this has come about from some bungling incompetence by Gordon Brown & his chancellor Alistair Darling. You would be wrong. the scale of the debt is intentional – and marks the dividing line between the philosophies of the two major UK parties.
The tradition in recent years among Conservatives has been in favour of light touch Government – ‘small government’ as it’s now being sold. The idea being that the key players in the world’s and the nation’s affairs will effectively manage things with least intervention (interference ?) from outsiders like Governments. The ‘market’ we are told will self regulate – it will have times of lean and times of plenty – in Labour-speak times of boom and of bust. The wise prepare for this, and put by in times of plenty/boom to see them through in the lean/bust years.
This approach carries a certain logical appeal. It has a simplistic fairness, but it is harsh because in lean times, the people who suffer the most are the people who are least able to put aside plenty in the boom years – not the entrepreneurs, landowners, and businessmen – but the workers who work for those people. This was the case in the early 1980′s when Margaret Thatcher argued “There is no alternative !” and allowed market forces to work through the hardship of a recession, meaning millions of people faced mid to long term unemployment.
It also has the disadvantage that, as we have seen recently, the market doesn’t always work well in regulating itself, and there are those operating within the market, who take reckless risks, which put the prosperity of whole nations at risk.
The new Labour approach, under the Blair & Brown government, embraced some aspects of the Conservative free market approach. Labour realised that the nation as whole tended to benefit from being a prosperous trader – but sought to smooth out the cyclical peaks and troughs of a totally free market approach, whilst allowing the market to benefit the economy. (It is a significant shift from a traditional socialist approach).
No return to boom and bust was Gordon Brown’s mantra as chancellor – one which is now often ridiculed.
It was however a highly successful approach – but it fell foul of a factor over which no chancellor can truly have control – the UK economy is not isolated from the World economy. We can dampen the effects of the outside world, we can ignore them for a time, but ultimately we are interdependent with the economies of every other nation, and we are prone to the booms and busts of their economies as well as our own.
As Gordon Brown yesterday acknowledged one of the errors which was made was to grant the financial institutions too much freedom, and provide too little intervention (interference ?) in their affairs. BBC News – Brown admits he made a mistake over bank regulation . The unfettered actions of those institutions then led in large part to the Global recession from which we are now slowly recovering.
For the Conservatives then to blame Gordon Brown for the recession is grossly unfair – in the first place the errors to which he admits, are ones which any Conservative chancellor would have been clamouring for – small Government, free market, and giving business the opportunity to manage its own affairs. These are actually the self same philosophies which the Conservatives wish to re-impose.
Secondly to blame Gordon Brown for the actions of banks, because he didn’t regulate them is akin to blaming householders, who didn’t have the right locks or alarm systems for having their house burgled. Sure they could have made things more difficult for the burglars – but the blame lies with the house breakers. Similarly, whether regulated or not, financial institutions in Britain and around the world, took irresponsible actions which have affected everyone.
Personally though I don’t feel it’s helpful to apportion blame – we are where we are. What is important is how we react to this. This brings us back to the debt which Gordon Brown has incurred.
Margaret Thatcher said “There is no alternative”. (There is no alternative – Wikipedia, )
She was wrong – Gordon Brown has shown this. His actions have been taken to dramatically reduce the impact of the recession, to prevent long term mass unemployment, to keep the economy active, and to put off the difficulties of repaying to a time when the nation will be more easily able to bear it.
The Conservatives still argue that this is wrong. That things should be left to take their course, and massive cuts in public spending should be imposed as soon as possible in order to hasten the economic recovery – but that this is the only way that recovery can happen. The mass unemployment and prolonged economic hard ship for many are seen as the price that has to be paid.
Whilst blaming Gordon Brown for the recession may be unfair, the Conservatives’ criticism of his borrowing to tackle the recession is not without logic. Their policy is philosophically defensible.
It is however a philosophy to which I do not subscribe, and which I feel is morally reprehensible.
So be in no doubt – that huge debt that is illustrated in the diagram in the link above is not there by accident. It’s there because there is an alternative, and that alternative has protected us from the worst ravages of the recession – which may well still come back to bite us if we are foolish enough to elect a Tory government on May 6th.
[ Just as a test I've got Labour's Eddie Izzard election video - let me know if you can't see it ]
As it appears the election will finally be called tomorrow, and the media will be overloading us all with political stories for the next month or so, I’m wondering just how engaged the general public – as opposed to the kind of people like you and me – who write and read political blogs – really ever are about politics.
Clearly some of them always are, and lots of them sometimes are. If politicians could only get their heads around why and when they are, and perhaps just as importantly – why and when they’re not, then we’d have a very different political landscape
One of the recent big events politically on television would appear on the face of it, to have been Channel 4′s “Ask the Chancellors” Televised Debate Ask the Chancellors – 4oD – Channel 4 – featuring real Chancellor Alistair Darling, Shadow Chancellor George Osborne, and for the Lib Dems, the man described as the Hung Chancellor, Vince Cable.
It certainly lit up the world of Twitter, and would appear to have been judged a success in terms of people voting on the C4 website and the trending topics on Social networking sites Ask the Chancellors: a success for Channel 4 – Telegraph Blogs , but did it really capture the public imagination ?
Certainly with estimated viewing figures of just 1.7 Million it would seem that it did not. Compare this with the audience of over 8 Million for B N P leader Nick Griffin on Question Time BBC celebrates record ratings for Nick Griffin on Question Time – Times Online . What was it about that programme, which fired up the public so much more for a late night programme featuring a minority group politician, than for a peak time “Big guns” debate ?
When I went into to work the day after the Question Time with Nick Griffin, the whole place was buzzing with talk about the programme – even those who hadn’t seen it, were talking about it.
After the “chancellors”, not a murmur. This despite the economy being probably the key political issue of the day. So why aren’t people interested ?
For me these are difficult questions to answer. What makes it difficult for me peronally, is that, when all said and done I have to confess to being a bit of a political geek. The fact that you’re reading my blog probably indicates that you are too. People like us, look at politics news, and usually see every nuance of every development, and turn it over in our mind, trying to work out what effect it will have on public opinion – our moods soaring with every stirring speech from our chosen parties, and dropping into the slough of despond with each embarrassing faux pas. It’s not easy for people like us to understand the workings of the minds of people like my Mum, who at 72 reads the Daily Mail every day, but claims she only does the crossword, and never reads the articles.
As a ‘political geek’ I’m someone who is often involved in on-line claim and counter-claim regarding political minutiae, and so I wasn’t entirely surprised a couple of weeks ago to be challenged (via Twitter of course) by independent candidate for Luton, and well known purveyor of oddly shaped vegetables Esther Rantzen (Esther4Luton) to watch Channel 4′s Dispatches programme regarding allegations concerning Labour politicians involved in unsavoury activity regarding payment from parliamentary lobbyists. Allegations which I was vociferously sceptical of, prior to seeing the programme.
It was an odd time for me as I was unusually not able to indulge my usual passion for all things politically newsworthy, and spent the best part of a week not really tuning in to Twitter, or the news, or any of my normal sources of information. I didn’t actually ever get to see the programme itself fully either. Instead I just got the background chatter from people I work with, the glimpses of other peoples newspapers on the train. In short I got the man in the street’s version of politics – not the politics wonk’s version. I have to say that the revelations about Stephen Buyers, Patrica Hewitt, Geoff Hoon, and Margaret Moran didn’t register on my radar at all, and when I came to catch up with this at the end of the week, it would appear that Labour’s reaction, had been to condemn the four out of hand, and more or less say – well we wanted rid of them anyway, it’s no big deal. Simples ! as those meerkats annoyingly say.
Except, to be fair to Esther Rantzen, I think she had both me and them bang to rights (I’m talking like Gene Hunt now – I’ll have to watch out). I couldn’t see any saving graces here, and none were offered by the party as far as I can see. The actions of these MPs appear to have been despicable and dishonourable. In other circumstances this could have been very damaging indeed to the Government, and to the Labour Party, and yet – somehow – it hasn’t been.
That’s not to say there hasn’t been inch after column inch of coverage of it in all the papers Stephen Byers, Patricia Hewitt and Geoff Hoon suspended over lobbying allegations – Telegraph . It’s not to say that the opponents of Labour out there in the blogosphere and twittersphere, haven’t gone ballistic over it. But if you ask someone who’s not a political blogger, someone perhaps who thinks Facebook is for looking at their niece’s wedding pictures, and for playing Farmville, ask them what they think about the lobbying allegations; then they’ll more than likely just look blankly at you. Geoff Hoon ? Geoff Who he ?
I don’t understand this. Sometimes the public really do get worked up about political stuff. Remember the #ILoveTheNHS hashtag ? the storm that was created when right wing Conservative MEP Daniel Hannan described the NHS as 60 year mistake ? It was huge. It was on all the newspapers, everybody heard about it, and it just grew out of nothing.
Except that it didn’t really – it had rumbled on for months with John Prescott amongst others, trying his best to make a story out of this, plugging YouTube videos of Hannan – all to no avail. The story would not run. But then it did. It ran and ran and ran.
I don’t understand it – and for once I’m not offering any answers – just asking the questions. When does politics ever really engage the public ? and Why ?
Maybe we’ll find out over the next few weeks.
Sorry I haven’t published anything for a while – I’ve been a bit busy.
I’ll try and make up for lost time. I’m planning a small series of blogs on “Things that bug me !” – because there have been a few that have just lately !
First thing that bugs me is a person who insists on leaving repeated comments spouting the same untrue garbage over and over again on my blog. In case you’re reading, (and I hope not) – I only get to see your comments if I care to check the spam trap – otherwise they’re just deleted. I’ve manually deleted all of your other comments too, even the ones I originally let through. My advice to you is to start your own blog, oh and try and make it more interesting. And get out more.
Returning to my theme …
Things that bug me : The rubbish being spouted about the rise in National Insurance contributions.
Since the budget we’ve seen lots of media outlets, including my old favourites The Mail give David Cameron unwarranted publicity because he doesn’t think raising National Insurance contributions is a good idea. The Mail managed to call it a “stealth tax” Osborne: I’ll cut Labour’s National Insurance stealth tax on jobs | Mail Online . Call me contrary but announcing a tax rise in the Budget, live on television, in Parliament, doesn’t really seem all that stealthy. In fact I’d say it’s really making it rather obvious.
Making it so obvious though didn’t really make it so that the BBC noticed it. Take a look at their At a Glance coverage from Budget Day.BBC News – At-a-glance: Budget 2010 key points – scroll down to the bit about National Insurance. Can’t find it ? Try searching for “National” or “insurance” or “NIC” – still not got it ? No that’s because they didn’t think it worth mentioning.
Strange then that they should now be making such a fuss, this article being one of several which gives prominence to “Business Leaders” disparaging views of the rise in NICs : BBC News – Cameron says Labour on ‘wrong side of working people
I could if I wished look at the contradictions in the Tory position – which seems to shift from draconian cuts one day, to who knows what the next, but really that isn’t what ‘bugs’ me so much – that’s their prerogative as a political party.
What really annoys me is that so many media outlets are giving such credence to these “Business Leaders” – many of whom are donors to the Tories, and who have no more qualification to speak on this subject than anyone else, and presenting it as “balanced news”
David Cameron says that it “is an impressive list of businesses” - Excuse me – 41 ? that’s very few indeed.
I don’t run a business I run a school. I don’t oppose the increase in National Insurance rise – is that news ? No of course not – and neither is the opinion of these “executives”
They are of course entitled to their opinions, and the Conservative party are entitled to theirs, and of course to change the budget if they are elected.
Which sort of draws attention to the fact placed in smaller print in most of these articles – the rise doesn’t come in until April 2011 – so actually, if it IS likely that increases in NICs will affect the economy adversely, the Labour government would also have at least 2 opportunities – the pre-budget statement, and the next annual budget to change direction if need be.
But the BBC – who are supposed to be impartial – choose not to make a big issue of that.
The 1% rise is of course, actually a half a percent rise on what was already planned in 2008′s budget – and somehow that didn’t seem to make as many waves back then.
This is biased and partisan reporting – the BBC in particular should have higher standards than this.
Just a very quick blog regarding this item on BBC News business pages : Bank of England warns inflation will exceed 3%
- which was in turn trailed by an RSS feed reading Bank warns of further inflation
The article tells us that the Bank of England expect inflation to rise slightly above 3% in the coming weeks. They then expect that it will fall quickly again, below the official 2% target level – and that it could well remain at that level for several years.
Fine – good reporting BBC !
It might have sounded a little more positive – not to mention truthful – if the headline had read “Bank expect long term low inflation after brief rise”, with the RSS Summary possibly being – “Bank predicts low inflation for years”