Thursday, July 17, 2008

A Topsy Turvy World - Cameron or Clegg on tax?

Arriving home in the early hours from the Liberal International AGM last night I heard the news about Nick's plans to cut taxes on 5 Live. This novel idea was not news to me, it had been discussed at FPC last week, which elicited my (measured!) response that whilst I had no problem with cutting taxes at the bottom end, I was concerned about where the cuts would be coming from to pay for such cuts. Presumably this was rushed out in response to David Cameron's "we may have to put taxes up" comment. Has the world gone completely mad?????! I arrived at work this morning to be greeted by a jokey comment from my boss (who happens to be a former Labour minister) about what was happening. It has elicited the expected response - Nick will cut taxes but he doesn't know as yet where the cuts will come from. THIS IS WHAT MAKES MY BLOOD BOIL!!!!!!! Of course I am a great supporter of Nick, but he knows and I know, this does not extend to supporting policies that potentially undermine all the promises we are making about the changes we would make in public policy terms, the pupil premium, ending child poverty, covering the cost of private health care……….need I go on? If Nick had identified something he wouldn't be doing anymore (I have made plenty of suggestions, Trident for example could be a big chunk of his savings -and maybe the silver lining of this premature promise is that we could offer the electorate a choice, Trident or tax cuts?) then I think he would have been in a much stronger position. We are in grave danger of falling into the unjustified stereotype of being opportunist. Whilst I respect the fact that many fellow bloggers are jumping for joy at this announcement, I am afraid, I am very afraid…...what happened to the party of 1p for education and the 50p tax rate, a recognition that quality services cost money? My position hasn't changed, but I fear my party's has.


The Burbler said...

Calm down dear.

He has identified some areas - reported in the Indie and presumably in more depth in the "Vision and Values "document when we see it:

"....scrapping the Department for Business, Enterprise and Regulatory Reform and moving parts of the Civil Service to cheaper locations outside London."

Tristan said...

Quality services aren't run by government.

Yes, they need money, but money spent as those who use the services think best, not by politicians who think they know best.

Its localism taken to its logical conclusion. Let individuals make their own choices.

The problem then becomes the privilege which induces poverty. That privilege must be torn down.

That's uniquely liberal.
The Tories say let the rich do as they like, let the poor be looked after by the rich.
State socialists and Labour say all must do as we say, we know best.
Liberals (and some anti-state socialists) say the individual knows what is best for themselves, our job is to eliminate the privilege which leads to poverty.

Linda Jack said...


I am my normal totally calm self! The thing is the sums haven't been done and that leaves us open for attack and speculation. My argument is that any cuts in spending need to be accompanied by a proper cost benefit analysis. The pre manifesto doesn't do that and I am told it is just a "direction of travel". Tristan, now we rarely do we?! Of course we want responsibility to be more local where appropriate, but a lot of funding (unless we really pile on the pressure with council tax) will still be coming from central government. As I have said, I am not against cutting taxes per se, I am against wooly promises the consequences of which haven't been thought through.

The Burbler said...

Sorry, it was the block capitals and exclamation marks which gave the wrong impression then!

Anonymous said...

Did u mean to give the tories and labour a quote for their leaflets Linda ?

"We are in grave danger of falling into the unjustified stereotype of being opportunist."

Peter Bancroft said...

You ask the question:
"…...what happened to the party of 1p for education and the 50p tax rate, a recognition that quality services cost money? My position hasn't changed, but I fear my party's has."

Presumably the answer is that the country has changed. We've got the extra investment from those policies and another 3 times as much on top of that. We now have a larger state than Germany as a % of GDP.

The alternative is to presumably be always in favour of a £4B increase on govt spending no matter what level its at, which to me sounds well, rather nonsense.

Bernard Salmon said...

My concern is not so much about the ideological aspects of cutting the tax burden - there is a long liberal tradition of wanting to reduce the burden on the poorest members of society - but simply about whether reducing the overall burden of taxation is actually achievable in the current economic climate and bearing in mind the Lib Dem commitment to radical decentralisation of power. I've gone into more detail about this on my blog.

Anonymous said...

Some good points here.

Anonymous, I don't think they'll need to root around blogs to find leaflet material - Nick just gave them a whole brochure full. I've been a member on and off for many years now, but the "Make It Happen" document has seriously shaken my convictions. It read like someone who knew they'd never have to implement the policies - I'm shocked he could of released it without costings, or that he make judgements first and then fits the facts later ("I've decided to lower taxes, find £20bn in cuts for me"...shouldn't it of been the other way around?!).

I'm all for cutting taxes, directly after we have a free and fair society, the trains run on time, we have a decent voting system, we've solved the energy crisis, etc, etc. Since nobody really knows how much it will really cost to achieve the social objectives many of us have shared for so long, it seems insane to start saying that we can reduce the tax burden by an exact figure. Peter, you are suggesting that there are only two positions, you are either in favour of tax rises or you are in favour of tax cuts. This seems like nonsense to me - surely statements regarding taxation only make sense when tied to a budget?

For years the problem has been proving we're a viable alternative, but "Make It Happen" has left me scratching my head.

The questions it asked didn't seem relevant to modern Britain and there were further signs of more 360's to come : notice how common Lib Dem themes like "Scrap Tuition Fees" have been replaced by "And we’ll make university and college affordable for everyone, too" in the document?

Anonymous said...

Find 20bn cuts
2 aircraft carriers (with no planes)
ID cards
NHS computerisation
That's about 50 billion.
Want more?

Anonymous said...

Troops back from Iraq and Afghanistan..

Anonymous said...

Yes, we're going to need more, because nearly all of those items listed were party policy at the last general election, ergo they have already been budgeted for.

We're looking for a fresh £20bn, without the 50p rate and without a penny on income tax (you have to find the replacements for those revenues too - without overstating the non-dom case...surely most non-doms you know are pretty wiley cats? It's going to cost a lot to get them to cough up). Furthermore, the only reason we're looking for £20bn is because that's the figure Nick has magic'ed into existence - why not £50bn? If he showed us the figures we'd be able to discuss this in a reasonable fashion - as it stands, we're just guessing at an arbitrary target. Add as many things to the list as you like, without parameters it's meaningless hyperbole.

Anonymous, to me you're emphasising the problem with the document. We appear to just say things without proper justification, this will be interpreted as a game that only a third party could play.

The government has already committed to many of the listed items too - you've yet to explain how you're going to break it to the world that you're not going to host the Olympics, or how you'd justify writing off the investment thus far.

It's easy to say things, but without justification it's equally easy to sound foolish.