Archive for the ‘Child Benefit Cuts’ Category

David Cameron in Birmingham – by Michael Webster

mercredi, octobre 8th, 2014

Prime Minister David Cameron is to be congratulated on the excellent speech he delivered at the Conservative Party’s 2014 conference in Birmingham, in marked contrast with Ed Miliband’s very poor one.

Interesting to note that he has promised $40 billion of spending cuts over two years, compared with French President Hollande’s $60 billion, and specifies these will come especially from Welfare, which M. Hollande is unlikely to dare to do.

Mr Cameron has at the same time promised tax cuts. This he is able to do because of the successful revival of the British economy. The IMF has just reported very favourably on it, withdrawing its previous criticisms of the austerity policy and stating that the country had emerged from the financial crisis and was due to grow at a faster rate than any other developed nation.

This is such a contrast with the lack-lustre French economy and the now faltering German one, that it should prove to be a vital factor which will win us the election.

Michael Webster,
BCiP member

Welfare Benefits – Separating Fact from Fiction

vendredi, avril 12th, 2013

With the Welfare debate developing as a key policy differentiator between the major political parties, the on-line Guardian newspaper on Saturday 6th April, 2013 carried the interesting article below on the overall benefits system in Britain:
Benefits in Britain: separating the facts from the fiction

« For 2011-12 it is estimated that 0.8%, or £1.2bn, of total benefit expenditure was overpaid as a result of fraud. This is far lower than the figures widely believed by the public, as revealed repeatedly in opinion polls. A TUC poll recently revealed that people believe 27% of the welfare budget is claimed fraudulently.

Hard to judge, and hard to generalise. There is a lot of movement in and out of work, so many Job Seekers Allowance claims are very short. More than 80% of claimants never go near the work programme because they aren’t on the benefit for long enough. A lot are off it in under six months. For disability benefits, there are a lot more long-term claimants, of course. In 2012, 18% of working-age households were workless; in only 2% had no one ever worked. More than half of adults in households where no one has ever worked were under 25. So although the proportion of households where no one has ever worked has increased recently, it is likely to be a manifestation of high and rising young adult unemployment. »

This has been followed by an article in the on-line Sun newspaper on Sunday 7th April:
Brits say benefits are too generous. Poll backs Tories’ attack on State handouts.

« SIX out of ten voters think State handouts are far too generous, a poll reveals today.
In a massive vote of confidence for David Cameron?s blitz on benefits, they think the PM is right to CUT them.
Most people believe at least HALF of claimants are not in genuine need and don?t deserve any help.

And they think striving families struggling on low incomes are being squeezed at their expense.
The huge public support for an overhaul of the welfare state is spelled out in a YouGov poll for The Sun. »

Then Alister Heath writing in the on-line City A.M. Monday of 8th April, 2013 sums it all up quite well by bringing together what he terms the HYSTERIA surrounding reform of financial services and welfare in his article:
Facts are vital to the debate on welfare and banking reforms.

« With some caveats, I?m broadly in favour of the coalition?s reforms to the welfare state, and wish the changes went further. Instead of helping the most vulnerable get back on their feet, the present system all too often traps them in poverty; it is also unfair to those who work. But I?m worried about Iain Duncan Smith?s decision to rely on complex computer systems, an area in which governments tend to fail.
What is clear is that the case for a return to personal responsibility should be made without seeking to demonise the vast majority of those on benefits. Nobody should feel the need to exaggerate the present system?s many woes. »

The Conservative party is currently « making the political weather » as they say and leading Labour on the issue of welfare reform. However, with the public generally in favour but apprehensive about the actual impact on individual hardship cases, there’s a need to concentrate on the facts and ensure successful implementation of the new welfare benefits system before the May 2015 General Election.

Public perception of an issue is important in politics but getting it wrong will make it too easy for Labour, very much on the defensive, to respond with e.g. their pantomime « nasty party » label for the Tories and throw away a clear lead with the public on this issue in the opinion polls.

Francois Hollande & British Family Allowances

vendredi, janvier 4th, 2013

Most of those of us who are towards the right of the political spectrum have been chuckling happily at the latest embarrassment of François Hollande. For those reading this from outside France, a flagship part of the President?s election manifesto was to tax annual incomes above a million euros at 75%. But his proposal to enact this has been struck down by the Constitutional Council. In France, unlike England, income taxes are levied on households not on individuals. But this ?super tax? was to be levied on individuals. So a couple who both had incomes of 900,000? would not pay this extra tax but a couple, with only one earner of over a million but with a significantly lower joint income than the other couple, would pay it. The Constitutional Council would not accept this because it was unfair.

For those of us who follow British politics, doesn?t that ring a bell? It does for me, in part because of a conversation I had with a member of my family recently in England. There the Government has, very reasonably in my view, decided to claw back all or part of the family allowances paid to the better off. But the amount the family will lose will depend on the income of the parent who is the higher earner, regardless of the income of the other. So, just as under the Government?s proposal in France, a couple with two earners each on £40,000 a year will not be penalised, whereas a couple where one of them earns £60,000 p.a. while the other stays at home caring for their children, will be.

We do not have a Constitutional Council in the UK; we rely on the good sense of ministers and parliamentarians under our system of parliamentary sovereignty. In general I believe that this system serves us well but, this time, it has let us down, badly. So has the Government. Of course, we are told, it is all very difficult, because we have separate taxation for husbands and wives. But the information, i.e. the income of both husband and wife, to make a system work fairly is known to the Government. If ministers had the power, when a senior civil servant tells them that something cannot be done, to find a more junior civil servant who can find a way in which it can be done and then make the two swap places, I believe that the problem would have been solved. As it would have been had David Cameron told Iain Duncan Smith that if he could not find a fair system, then he could not have his legislation and would have to raise the money elsewhere. All politicians know that there is no such thing as a tax that everybody considers fair. But that is no reason for adopting a system that everybody considers unfair.

The Government have done themselves electoral harm in two ways. Firstly the system is so daft that it has made them seem economically incompetent. And the battle for voters? perception of economic competence is going to be a key element of the next election. Secondly they have stirred up considerable resentment among parents affected, many of who would otherwise have voted Conservative but who will certainly not do so now.

As the song has it: ?Ain?t it all a blooming shame?.

Robin Baker

Child Benefit Cuts

jeudi, octobre 7th, 2010

The government has announced at the Conservative party conference that, as part of their fiscal austerity programme to eliminate the public spending deficit, it is only fair to cut child benefit for those parents considered better-off and, therefore, able to carry a heavier share of the tax burden i.e. those with annual earnings of £44,000 or more and in a higher tax bracket.
However, due to the perverse and socially engineered effects of the current UK tax system, where everyone (whether married or not) is taxed as a separate individual, this would seem to imply that a single mother earning more than £44,000 would lose her child tax credits whilst a household where both parents each earn less than £44,000 for a joint income of up to £88,000, could still retain their child benefits. It has as a result been quite roundly attacked as manifestly unfair although an opinion poll taken immediately after found 85% of respondents in favour and 15% against, roughly in the same proportions as those who would still retain child benefits versus those who would lose out!
Given that the Conservative party in common with its opponents must employ clever political thinkers and analysts, this begs the question that, if it is so easy to pick such obvious holes in this child benefit tax policy, why announce it now during the Conservative party conference and in advance of the detailed programme of cuts planned to be announced on 20th October? One would like to think that this is part of an overall policy to guide public opinion towards the benefits of a tax system which not only provides tax concessions for children but also for the supporting married couples, taxed on their joint income as per the French system for example.
The Conservative party has traditionally supported marriage as a source of stability in society and the prime minister in defending these proposed child benefit cuts has already suggested that married status should be recognised within the tax system. There are of course the arguments of those who say that this discriminates against single, childless individuals and that there is no evidence that homes with two committed but unmarried partners cannot provide as stable a family environment as a married couple. In albeit mainly Catholic but constitutionally secular France, the tax system favouring marriage and children can also be traced back to the need to rebuild the nation after two world wars fought over its soil. Indeed with the almost statutory three children the resulting low level of direct income tax paid is highly attractive to young parents, during their early and generally lower income married life.
With civil partnerships including same sex couples now recognised under UK law, why cannot the tax system recognise marriage and the added costs of raising children during the early, more financially-stretched years? Certainly, Ed.Milliband the recently elected new-generation leader of the Labour party, who has in the past been too busy to have his name on the birth certificate of his first child, has admitted to the press that he is considering marriage to his partner in the future.