Tories Disrespect Vince By Repeating What He Said Last Week

So today, the BBC reports, in an astonishing piece of investigative journalism, that one of their shadowy “senior Conservative sources” has tipped them the wink that…

…there are plans to keep the payment link between students and individual universities.

As such a “pure graduate tax” is described as an “unlikely” option.

But… Vince Cable said the other day he wanted a graduate tax, didn’t he? So surely this is an affront to Lib Dem influence in the coalition! Quite appalling!

Well, hold on a moment. What did Vince actually say?

We currently have what is misleadingly called a system of ‘tuition fees’. Many people believe, wrongly that when students arrive at university they or their parents are required to get out their chequebooks, or wallets, and pay more than £3000 for a year’s tuition.

The idea that students are repelled from higher education by fees owes much to this erroneous belief.

In reality of course most students meet these costs by taking a student loan, payable direct from income after graduation when earning a reasonable salary. In this sense, we already have a form of graduate tax. The problem is that it is a fixed sum – a poll tax – regardless of the income of the graduate. It surely can’t be right that a teacher or care worker or research scientist is expected to pay the same graduate contribution as a top commercial lawyer or surgeon or City analyst whose graduate premium is so much bigger.

The current system has the further disadvantage that it reinforces the idea that students carry an additional fixed burden of debt into their working lives. Yet, most of us don’t think of our future tax obligations as ‘debt’.

I am interested in looking at the feasibility of changing the system of financing student tuition so that the repayment mechanism is variable graduate contributions tied to earnings. I have spoken to Lord Browne about this and he has assured me that he is looking at this issue as part of his review.

By looking at the periods of time over which contributions are made, the level of thresholds that trigger the contribution, the rate at which contributions are paid, and the other key variables, it may be possible to levy graduate contributions so that low graduate earners pay no more (or less) and high earners pay more.

He only uses the words “graduate tax” once, in the sentence “In this sense, we already have a form of graduate tax.”

Well OK, but the media discussion about this all said he was suggesting a “graduate tax”, and Vince didn’t do much to disabuse us of this illusion, did he?

Um…

Actually, yes he did. On the same day he made the speech, which in itself was quite carefully worded, he went on Newsnight to talk to that nice Gavin Esler about it all. At 28:40 (or thereabouts) into that night’s programme, the following exchange took place:

ESLER: Surely any graduate tax, which would be centrally distributed and centrally collected, is exactly anathema to what this government’s supposed to be about, which is devolving power, letting people compete, letting universities compete perhaps, which you can do with a tuition fee system but you can’t do with a graduate tax.

CABLE: That’s correct. No, I emphatically don’t want to see a centralised system. There are versions of the so-called graduate tax – and you know, we have to be careful about the -

ESLER (interrupting): Can you decentralise a graduate tax, though?

CABLE: Absolutely, I mean the present system is a form of graduate tax. You take a fee, you take out a loan, you repay it at 9p in the pound, that’s how the current system operates, except it’s not related to your earnings, and those fees come back to the university, and I want to maintain that element of the system. Certainly I do not want a centralised system, I do believe in universities’ independence. I want to see universities changing, actually, to be much more responsive to students, but they’ve got to change.

So… to sum up then: A “senior Conservative source” has today told the BBC something that… Vince Cable told the BBC on the SAME CHUFFING DAY AS HE MADE THE SPEECH, which is now nearly a week ago.

I leave it as an exercise for the reader to assemble their own final sentence, which must include the words “political journalists”, “find”, “arse” and “both hands”.

The Moment Vince Asked George About IHT

This? This is an excellent face.

Ask The Chancellors – Instareaction

Well, there we go then. Channel 4 have got in there first, kicking off the historic series of debates which are going to be a feature of this general election for the first time ever. So what to make of it all?

Naturally, as a Lib Dem, and a sane person to boot, I thought Vince won. The studio audience seemed to agree, too – I think I’m right in saying Vince got more applause than the other two put together. It got a bit embarrassing, really – when you even get applause for saying “I told you so”, you know there’s something going on!

But there’s little point in going on about Vince. I think the real story here is how shifty and nervous George Osborne looked. His voice wobbled from time to time, sure, but the real giveaway was not in his body language or tone of voice. It was in what he said. Time after time, he appealed to higher authorities – “under David Cameron’s leadership”, “lots of economists agree with me”, “it’s not just me, as chancellor you’re part of a team”, “I agree with Vince”. He constantly prefaced his remarks with backup from someone more credible than him, implicitly acknowledging that Vince knows more than he does about economics (anyone remember that priceless Evan Davis interview?) by including Vince in this group. If there was any doubt about that, he more or less conceded it at the end, by feeling the need to chuck in the old “Lib Dems aren’t going to form the government” bollocks, because he could see that the way things were going, the conclusion people would draw from this programme would be to vote Lib Dem.

All we need now is for people to stick with that judgement, and not let themselves be swayed by the Tories’ spin machine.

A List of Labour Hypocrites (and a few who aren’t)

Yesterday, Vince Cable used one of our Opposition Day debates in Parliament to table a motion on Equitable Life policy-holders who have lost their pensions, pushing for justice for them. The motion he tabled was almost identical to an Early Day Motion which many MPs from across the house had already signed, so we had some hopes that reason might win out over tribal idiocy on this occasion.

Sigh.

Here is a list of the Labour MPs who, whilst quite happy to sign an EDM on the matter, couldn’t bring themselves to actually embarrass their own party and vote for the (almost identical) Lib Dem motion when it might make a real difference:

Abbott, Diane
Ainger, Nick
Anderson, David
Anderson, Janet
Atkins, Charlotte
Bayley, Hugh
Begg, Anne
Berry, Roger
Borrow, David S
Burden, Richard
Burgon, Colin
Caborn, Richard
Cairns, David
Campbell, Ronnie
Challen, Colin
Chapman, Ben
Clapham, Michael
Clark, Katy
Clarke, Tom
Connarty, Michael
Cook, Frank
Crausby, David
Cryer, Ann
Cummings, John
Cunningham, Jim
Dean, Janet
Dobbin, Jim
Dobson, Frank
Etherington, Bill
Fisher, Mark
Francis, Hywel
Gapes, Mike
Gerrard, Neil
Godsiff, Roger
Hamilton, David
Hamilton, Fabian
Harris, Tom
Henderson, Doug
Hepburn, Stephen
Hesford, Stephen
Heyes, David
Howarth, George
Howells, Kim
Humble, Joan
Illsley, Eric
Jenkins, Brian
Jones, Martyn
Kaufman, Gerald
Keeble, Sally
Kumar, Ashok
Laxton, Bob
Linton, Martin
Love, Andrew
McCafferty, Chris
McGovern, Jim
Miller, Andrew
Morley, Elliot
Murphy, Paul
Naysmith, Doug
Olner, Bill
Osborne, Sandra
Plaskitt, James
Pope, Greg
Prosser, Gwyn
Riordan, Linda
Robinson, Geoffrey
Ryan, Joan
Salter, Martin
Singh, Marsha
Slaughter, Andy
Smith, Angela C (Sheffield Hillsborough)
Smith, Geraldine
Soulsby, Peter
Stoate, Howard
Stringer, Graham
Taylor, Dari
Taylor, David
Turner, Desmond
Walley, Joan
Wyatt, Derek

I assume they’ll all have very good reasons for changing their minds?

I wish I didn’t have to make a point as partisan as this, but frankly, when you look at the voting on this motion, it’s hard not to.

A genuine well done, however, to the 18 Labour MPs who did manage to vote for the motion, not just sit on their hands and abstain (as a few of the EDM signatories would seem to have done):

Banks, Gordon
Cawsey, Ian
Corbyn, Jeremy
Farrelly, Paul
Field, Frank
Hall, Patrick
Hopkins, Kelvin
Jones, Lynne
Lazarowicz, Mark
McDonnell, John
McIsaac, Shona
Morgan, Julie
Owen, Albert
Simpson, Alan
Truswell, Paul
Wood, Mike
Wright, Tony

Thanks to The Public Whip for the data used to compile this post.

George Osborne Is Still Not Fit To Be Chancellor

Today’s Guardian has this story about inconsistencies in George Osborne’s claimed savings from raising the male pension age:

The NIESR said Osborne’s team had made a mistake in their calculations, misreading a paper written by the thinktank earlier this year. Osborne aides originally based their calculations on a NIESR document in the House of Commons library. After his speech the thinktank sought clarification of his assumptions. It has recalculated the figures and will present them at a conference on Monday.

The NIESR aren’t, of course, the first people to wonder whether everything about Osborne’s plans really adds up; the Lib Dems’ very own Work and Pensions guru spotted this one a few days ago, commenting:

The only other explanation is that this is a figure for a whole Parliament – ie an annual saving times 5. Presumably in the 2016 to 2020 Parliament you could save over £10 billion from this measure, and then you are not far off the Tory figure. But the impression they seem to want to give is that this is a huge and specific cut, when, in the context of a Government deficit this year forecast to be in excess of £175 billion, £2 billion saving on pensions starts to look a lot more modest. Surely they can’t be trying to mislead us??

Why yes, Steve, they might just be. Not quite the fiddle you guessed, instead they are quoting the figures to us not in today’s money, but in 2020 money:

A spokesman for Osborne said the £13bn savings included inflationary rises between 2009 and 2020.

This, despite NIESR’s judgment that “There is no way of knowing how much it will save except in today’s money,” adding that (in today’s money) “the package that the Conservatives are proposing … will only raise £4bn [in 2016]“. The savings the Tories are talking about will only really fill out in about 2023. Not really going to help much with the deficit in the meantime, is it?

As our own Lord Oakshott comments in the Guardian’s piece: “This saga of incompetence and dishonesty shoots to pieces his claims to be a responsible chancellor.” Coming hot on the heels of a conference where the Tories main aim seemed to be to polish up George Osborne’s reputation and make him look chancellor-like, this is a bit of a problem for George. After all, it doesn’t look great for the NIESR to be holding a conference on Monday at which they essentially mark George’s work, and give him a “must try harder”.

Like Matthew Oakshott said at conference, Vince is a professional, George is an amateur. Not only do we realise it, not only do most people in business and finance realise it, but the Tories know it. Deep down. I watched the conference coverage of Tory conference on BBC Parliament. Ignoring, for a moment, the rather sullen response he got to some of his speech, lets talk instead about how many veiled criticisms were voiced from both the floor and the stage about Osborne’s lack of experience. On the afternoon when Ken Clarke spoke, the session which he lead was full of comments to the effect that people without any business experience shouldn’t be running our economy, to warm applause from the floor. All very well when you’re pointing up some of the experience of the Tory party’s business team, many of them parachuted straight from industry into the Lords, but it rather falls down when you remember that Boy George has done almost nothing in the world of business either.

Wikipedia offers us this summary of George Osborne’s experience before going into politics:

Osborne’s first job was to provide data entry services to the National Health Service to record the names of people who had died in London. He also briefly worked for Selfridges. He originally intended to pursue a career as a journalist, but, after missing out on a position at a national newspaper, was informed of a vacant job at the Conservative Central Office.

Brilliant. OK, so that’s not necessarily a sympathetically written description. But even the Tories’ own website can only manage this:

After a short spell as a freelance journalist, George joined the Conservative Research Department in 1994 and has since dedicated himself wholly to politics.

It doesn’t exactly suggest the kind of background experience that was repeatedly called for at Tory Conference, does it? I might as well throw in, for good measure, a quick reminder: Vince Cable was Chief Economist for Shell. Just mentioning.

The Tories hoped, following a decent conference turn from George, that these waverings might be dying away. George has come of age, they said. But it’s not just this, we’ve also recently had George’s imaginary secret documents. It’s quite clear that George still hasn’t learned to read those details properly. Many more revelations like these, and I’m not convinced that he’s quite so secure in his position as people assume.

And if he stays, and the Tories are serious about installing him as Chancellor, then we all ought to be very worried.

Vince Interview Part 3

And so we come to Game Theory, and the story that appeared in the FT, Graun and BBC a couple of days ago (on the day of the interview, in fact). I lobbed Vince a nice soft ball, inviting him to make any comments about the story. His response was that he was quite cross about the story’s appearance; he feels that it’s a silly story that has been somewhat manufactured by a journalist who saw some mind maps on a white board in Vince’s office. Vince told us that the mind maps weren’t actually about a hung parliament at all, but were about “economic research”. He regretted that the story had been picked up, because it has apparently “upset a few people”, presumably the party’s press handling wing.

All of which is fine, but it doesn’t entirely explain the story that appeared. I’m quite prepared to accept that the mind maps bit might be wholly unrelated to thinking about a hung parliament, but nevertheless, the story did make itself out to be based on more than just the mind maps thing. So… I dunno what to make of it, really.

Richard was up for another go next, asking about the sale of the Royal Mail: Is now (the bottom of the market) a good time to sell it? Vince was broadly supportive of some of Mandelson’s aims in the legislation he proposed, in particular the correcting of earlier mistakes in the government’s handling of the Royal Mail. He pointed out that the new legislation would mean much less “cherry picking” of the Royal Mail. Vince also feels that there is a role for private capital in the Royal Mail, but not in the Post Office, which should be national. Having sounded not-wholly-unopposed to the government’s plans, however, Vince did say that John Thurso’s series of tests for the legislation probably weren’t going to be met, and that therefore we would likely oppose the legislation. The tests are all the usual Lib Dem stuff about worker shareholding of the Royal Mail, etc.

Next Alix, with the excitement of Howard Dean’s speech still ringing in her ears (and her conference luggage still sat at her feet), was interested to know Vince’s reaction to Dean’s reaction to her question to him.

Ahem. I’ll try that again.

Howard Dean doesn’t really like over-targetting resources, and thinks we need to do everyone the courtesy of at least asking for their vote. What does Vince think about this? Well, it turns out that Vince thinks we’re not running a presidential campaign, and that our FPTP system forces us to ensure a “base” of support, so Dean’s advice could be taken too far. Having said that, Vince seemed in tune with the optimism of Dean’s approach, pointing out that almost all Lib Dem seats were no-hopers at some point, and that usually it’s just a matter of gnawing away until a tipping point arrives. Often, it’s very much down to the right individuals getting things moving. There are many areas where we don’t really have much presence in the way of councillors, and yet we do have a lot of members.

Jo wanted to know what Vince felt was good and bad about the experience of being a PPC. Vince, lest we forget in the glare of his current glory, stood three times for the party before being elected: twice in York, and once in Twickenham, the seat he eventually won. He began this process, he says, quite naive, believing that getting elected was all about making “a few good speeches” and raising a profile that way. He quickly came to appreciate the importance of canvassing, getting out the vote, and all the other bits and bobs that go with winning elections. He emphasised the importance of building a good team – it’s not just an individual effort.

Lastly, Mark asked what Vince’s attitude to his “glamorous appearances” at various dinners was. Were they targetted? Essentially, the answer was that it tends to be “first come, first served”; Vince tries to play the target seats game, but finds it in some ways more interesting and heartwarming to stray from this beaten track and visit the aforementioned local parties with little elected presence, but nevertheless a reasonable membership. Vince is something of an enthusiast for such local parties, and tries to visit them if he can fit it in whilst visiting a target seat, because it’s quite possible that a nice dinner with Vince could be what a local party needs to get itself off the ground.

And on that optimistic note, our time with Vince was almost up, leaving just enough time to take a picture. And here it is, complete with bizarre Portcullis House carpety wall hanging:

Bonus points available for correctly identifying me as the one who doesn’t look like Jennie, Mary, Jo, Helen, Vince, Mark, Alix or an elephant.

Vince Interview Part 2

You join us, dear reader, sat around a table in a room in Portcullis House, wondering whether to eat another donut, and talking to Vince Cable. If you want to know how this came about, read part 1.

Next to ask a question was Millennium’s daddy, Richard. He wanted to know about the Euro, and whether it was likely that the recession would unify the Eurozone or split it. Vince didn’t really know, so he said so; it’ll all come out in the wash. The question then is, how do we, the UK, react, and how do we stand to fare in the meantime. Vince was cautiously pessimistic about the verdict of the international currency markets when assessments of the UK’s position are made, including the toxic assets that we have now taken on. It may not be good.

With that in mind, Vince reminded us that he and Nick Clegg are “well disposed” to the Eurozone, and hinted that the grass which Chris Huhne was said to have kicked the Euro into a little while ago might not be quite as long as some had imagined. If the Euro turns out to have weathered the recession well, the issue of our joining it should be revived.

Helen was up next, and asked Vince about blogging, and why he didn’t do it. Vince’s response, perhaps unsurprisingly, was “time”, and priorities. Vince has spent a good deal of time on the MSM recently, and, whilst he recognises that the print media in particular are a sinking ship, he obviously doesn’t feel it’s time to cut our losses and run for the cyberspace dry land just yet. He also felt that he already got quite enough contact from people writing to him, and wasn’t blogging likely to encourage more? Having said that, he was open to the idea, and praised Lynne Featherstone’s efforts to persuade him of the merits of blogging.

Mary tried to offer encouragement, in the form of the information that her site gets a higher readership than Vince’s constituency site does. She suggested that blogging was a good way to drive up readership of a site. Vince seemed interested in this – what was it about blogging that did this? The answer, of course, is regularity. If you can spend half an hour a day on a press release, you can spend it on writing a blog post, and with any luck, the press will just lift quotes from your blog instead. Vince pointed out that he already does post up all the press release type material on a daily basis, to which the response was that a more personal feel to the blog was key to its appeal.

It’s for this reason that I have to say, personally, that I suspect if anything blogging would reduce the correspondence that Vince’s office has to deal with, because the more people feel that they have real contact with someone online (the great strength of blogging), the less motivated to contact them by other means they become.

Into this mix, Alix added the observation that the LDV fringe event at conference, at which several people from the US Democratic party had described techniques that worked for the Obama campaign, had a real focus on personal stories: canvassers on the doorstep were encouraged to simply tell their own stories, of what had motivated them to get involved with the campaign. The benefits of blogging stem from the importance of the personal in politics. At least, I think that’s why that was relevant!

Jo was next, for the question that we all sometimes worry about as Lib Dems: is Vince’s approval rubbing off on the Lib Dems sufficiently? What could be done to improve this? First off, Vince didn’t really buy any argument that the Lib Dems are especially weak at the moment, looking at where we have often been at similar points in the election cycle. In any case, he tries always to get a mention of the Lib Dems from his appearances, but he also feels that it’s important not to be too tribal in his punditry, otherwise people simply wouldn’t come to him for it at all.

Jennie recalled that when people tell her Vince should be leader, she’s not convinced, because then we would be back in the situation that the party has fought to escape from, which is that we are perceived as a one man band. Vince agreed; there shouldn’t be a return to the Paddy Ashdown days. As such, it seems to make sense to me that jitters about Vince’s position in the press are a growing pain for the Lib Dems: we aren’t used to there being more than one person representing us in the media, that’s all. We are now fortunate enough to have Nick, Vince, and not forgetting Chris Huhne, who quite often manages to get himself on the telly ‘n’ that as well.

Mark wanted some investment advice next, a modern day South East Asian unit trust, if you will, but Vince wasn’t biting. He pointed out that he is as fallible as the rest of us, and that if you’d asked him what to do five years or so ago, as his wife did, he would have suggested a diverse investment in stocks and shares, whereas his wife chose instead to just stick it in a high interest Nationwide account, and is all the better off for it. The point Vince did want to make was that diversity of investments is key, and that in fact, in his estimation many assets are currently under-priced, so people with the liquidity have every reason to invest at the moment.

Out of this, came a brief discussion of an issue that bothers Vince, specifically the unpleasant way that means-tested benefits effectively confiscate savings. Unfortunately, my notes on that are pretty indecipherable to me, so you’d better hope someone else writes it up better!

Mary congratulated Vince on his contributions during conference to the debate over faith schools, commenting that it was nice to hear Vince give opinions on issues other than economics. Vince pointed out that to some people in his constituency, it was unusual to think of him as a treasury spokesman; on a local level, Vince has tended to be more a crime and hospitals kind of guy.

Anyway, that’s enough of that for now, but join me in part 3 for Vince reaction to the recent Game Theory story.

Vince Interview Part 1

Arriving at Portcullis House, I managed to blink as the security people took a picture to hang round my neck. I staggered, bewildered into the atrium, looking around for people who looked like bloggers. I got it right first go – well, the elephant was a dead giveaway – and we loitered until joined by more bloggers. Lady Mark was already ensconced on the other side of the glass barriers – the glass is greener on the other side – and then who should we spot, but Vince. Much waving ensued, and he came and let us through into the special area for special people. Since there were a lot of us, he went and got us a room to use instead of his office (quite disappointing – no opportunity to verify this Mind Maps business!).

And so, sitting comfortably and suitably donuted, we began.

Alix kick off, asking whether we’re heading for an overhaul of our tax policy, perhaps after seeing hints of such a move picked up over the weekend by some in the MSM. Vince’s answer was basically political speak for “yes, it will be changing”: the aims will remain the same, but “the details of how we do it will have to change over time”. He reiterated that we are committed to a 4p cut in income tax “or the equivalent”, and mentioned allowances as one such potential avenue of equivalency.

Jo, meanwhile, wanted to know about diversity and equality and stuff, and Vince’s role on the Diversity Engagement Group, asking what the next steps are, and whether issues like these were going to end up on the back burner because of the recession. Vince felt that these priorities wouldn’t be changed by hard times, and, whilst seeming to concede perhaps that there wasn’t as obvious a “next step” on wimmin, he hoped that BME candidates might stand to do very well under the party’s stated strategy of attacking the soft underbelly of Labour support in northern cities, etc.

Jennie was next round the table, and asked about Vince’s interest in bees. Vince explained that, as part of the normal business of being known around one’s constituency, he had been invited along to the apiary at the end of his road, for an open day. It was there that he had his ear bent about Colony Collapse Disorder and the surrounding issues, and with this ringing in his ears, he went back to parliament and asked Gordon Brown a question about it in committee. The response was so derisory and uninterested as to make Vince a whole lot more bothered about it than he would otherwise have been, it seems. Brown implied that it was exactly the sort of daft issue that gets Lib Dems going, and was a waste of serious people’s time. It was this scientific illiteracy – a common theme for many bloggers, not least Jennie – that convinced Vince that pressure was required to help ministers do the right thing, and since then a cross-party campaign has grown around the issue.

Mark’s question was about the civil service, and whether the party was seen as “Civil Service friendly”, following Vince’s criticism last conference of some public sector bonuses. Vince felt it was important not to differentiate between the public and private sectors, and that practices that were criticised in one sector would therefore be criticised in the other. Vince was aware, of course, that his comments about the number of civil servants on over £100,000 had annoyed some of our councillors, and he expressed some sympathy for the lower ranks of the civil service, but he’s sticking to his guns. He was rather keen on the term “public sector aristocracy”, and pointed out that it wasn’t so much just the wages, as the triple-whammy of wages, job security and pensions that put many in the civil service in such a privileged position. For Vince, it’s about attacking privilege, and it extends from the private sector, to civil servants, and to MPs, who he also singled out as unusually shielded from the economic weather.

Mary asked how the government’s habit of offloading the dirty business of taxation onto local government could be fixed, and about the unfairness of central government’s funding of local government currently. Vince’s response was that there is always lobbying on the formula that works out funding to local authorities. Although generally quite good, he believes, the formula tends to fall down at the extreme ends of the income scale. Essentially, local government needs a stronger local tax base, and Lib Dem policy would do this, for instance by making business rates local.

Next up it was my turn. Looking at my scribbled notes made earlier in the day, I plumped for a more outward looking question, for variety’s sake, and asked about Gordon Brown’s alleged interest in international regulatory frameworks. Was he likely to achieve anything useful from making the issue a focus of the G20? Vince’s reply was closer to the Tory line than I expected, calling Brown’s focus on this as a solution “a cop out”, to avoid responsibility for his mistakes; of course, now comes the bit where it deviates from the Tories: Vince can spell out what he means by that. Brown had, after all, allowed finance to become far too large a part of our economy, and failed to implement the Basel rules in the UK as well as other countries, like Spain and Canada, did it; here the rules acted pro-cyclically in the housing market.

Vince rounded off this answer with a quick mention of his forthcoming book, The Storm. Subtitled “The world economic crisis and what it means”, it will likely cover the answers to my question and a great many more besides. So I will leave part one of my write up here, to allow you to go off and pre-order it!

Woop!

1. I now have access to the electric internet again; my usual inconsistent pace of posting will return shortly.

2. I interviewed Vince Cable today, along with several other bloggers (see below).

3. I met several lovely fellow bloggers who I’ve not met before, including the regal Lady Mark, the owner of an excellent bag Jennie, the I’m-trying-desperately-to-resist-the-temptation-to-call-her Jo Crispy-Strips, the distinguished Mary Reid, the brilliant Alix, the lovely Helen Duffett, and of course the fluffy Millennium with his daddy Richard.

4. An evening in the pub’s always quite nice, innit?

Best HIGNFY Ever!!!!!

Tom Baker, Vince, Chris Addison. Enough said.

ETA: Now on iPlayer here (for the next 7 days).

Tax Credits as Tax Cuts

So I just watched PMQs and the discussion of it afterwards on the Daily Politics, which you can see again (today anyway) here. The interesting thing to note here is not the u-turn itself, it is the bizarre situation the government have put themselves in regarding the whole issue of taxation.

Andrew Neil was busy putting a lovely, liberal argument to Patricia Hewitt about just not taxing people rather than making them fill in a form to get their money back. I can’t be arsed to transcribe it, but here’s the conversation stripped down to its core meaning:

Neil: My cleaner pays more tax under this system. You are making her pay more tax, then fill in a big form to get some of it back.

Hewitt: The tax credit system has transformed the lives of poor families.

Neil: She doesn’t have a family, she isn’t entitled to most of the tax credits.

Hewitt: Which is why we introduced the working tax credit for single people without children. But yes, some people still don’t qualify for it, so clearly what’s coming is an extention of tax credits.

Now, pay attention at the back! The argument on this stuff has gone basically as follows since Brown first announced the abolition of the 10p rate in his last budget:

Government: We are abolishing the 10p rate.

Opponents: But that leaves many people, mostly poor people, worse off.

Government: But not all poor people. Look, pensioners, people with children, etc. are fine, because we’re giving it back to them with tax credits and the like.

Opponents: Yes, but what if you’re on a low income and you don’t have children. Then you will lose out.

Government: Lalala, I’m not listening.

Opponents: Well, our constituents are, so we’re going to keep this up and possibly destabilise you.

Government: Oh all right then. But we aren’t reversing the decision.

Opponents: Then you’d better think of something else to make it all better then, hadn’t you?

Government: Got it! We roll out more tax credits and winter fuel allowance to make sure nobody loses out.

Opponents: Hmm. That’s a pretty wide net of tax credits, then.

Government: Oh, don’t worry, it will be.

The point has to be made here that tax credits are supposed to be a redistributive measure, smuggled in by Brown to allow him to feel like a Labour chancellor whilst seemingly not doing too much redistribution. And fair play, there is an argument to be made there; after all, if you want to make judgments about how much of their own money people should be allowed to keep based on something other than their income (eg. whether or not they need to look after children with it), this is one way to do that.

But they’re only justifiable as long as that’s what they are, a specifically redistributive thing, designed to allow the government to effectively tax some people more than others depending on whether or not it approves of their life choices. As liberals we may not like that, but you have to admit that it’s got some ideological underpinnings.

Now look again at what the government and its surrogates have done in conceding the argument to the opponents that there must be no losers from this budget, but maintaining that the way to correct this is not to reverse the original decision (or to do something else to the tax system – say, adopting Lib Dem policy). They have made a mockery of the tax credits system. If, as Hewitt and others are suggesting, the point of the tax credits system is simply to roll it out until nobody is any worse off, then we are going to end up in a situation where everyone on a low enough income is eligible for some tax credit or other, and no fiscal difference has been made to anyone. All that will have changed is that now, people are filling in more forms to stay in the same situation as they had before.

This is bonkers. So in addition to simply pointing out who the people who still lose out from this are, can our response start to take a slightly broader perspective too? Please, Mr. Vince?

Unassailable

Why is it that whenver someone says on GMTV that the party is not doing well enough, it is interpreted not as the statement of the obvious that it is, but as a comment on the leadership? And yes, I know that Ashley asked specifically about the leadership, but presumably as a response to Vince making this (crushingly banal to anyone with a smidge of perspective) observation that the party is not doing well enough.

Any self-respecting political party should want to be in power, or what is it there for? If the polls suggest that this is not about to happen, then the party is not doing well enough. The further the polls are from showing that, the less well they are doing, ultimately. Of course, direction of travel is also important, but that’s another matter. The way these statements are interpreted by the media (in their wider sense) is bizarre, until you realise that for them, the Lib Dems’ purpose is not to be in power, because they don’t see us as a normal party. They couldn’t give a shit about the policies; as far as they’re concerned, the Lib Dems are there as the protest vote, the kingmakers in hung parliaments, and not much else. Oh, yes, and they are mostly to be represented in the form of their leader, whose position is to be continually reassessed when they get bored of discussing anything else. In this light, it makes sense. Problem is, it’s not true. That’s not why I, or any Lib Dem I’ve ever met, joined the party.

Oh, and as for The Sunday Programme, I don’t know why any of our MPs bother to talk to them. It only gets seen by the Westminster villagers who remember to set the video and insomniacs, since this week it will be on at 6am on Sunday. The program only survives by trying to extract some piece of intrigue from a given interview, safe in the knowledge that the spin they are putting on it will not be made to look silly because nobody is actually going to watch the complete interview.