Conference: Make It Happen debate… the live-blog
Written by Stephen Tall on 15th September 2008 – 3:16 pmLib Dem Conference:
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Yes, it’s the day of the Big Debate on Make It Happen, the party’s policy and consultation document, and there’s keen anticipation here in the conference hall. Over 100 members have applied to speak so far, so we can expect some fiery views on both sides of the should-we-cut-the-tax-burden debate.
The party’s manifesto chief Danny Alexander has introduced Make It Happen - plenty of warm applause, including for the line that tax cuts for ordinary people are very much part of a social justice agenda. He urges conference to vote down Paul Holmes’ and Evan Harris’s amendment, arguing it will undo all of the good of Make It Happen.
He’s followed by Paul Holmes who’s moving the amendment to Make It Happen, noting that he agrees with almost all of it but urging conference not to vote for a cut in the overall tax level when there are so many needs for investment in public services. His passionate peroration gets a rousing reception.
Mike German, outgoing Welsh Lib Dem leader, is up next supporting Make It Happen: “I don’t want bigger government; I want bigger people”. It’s lucky he’s not leading the Liliputians.
Richard Grayson speaks for the amendment, stressing that it calls simply for public investment to be placed ahead of tax cuts. Now Graham Watson, leader of the Lib Dem MEPs, stresses the impact the Lib Dem tax cuts will have on ordinary people, those “struggling to put food on the table, or pay for their children’s school clothes”. (Incidentally, Alix-of-the-People’s-Republic will be pleased to hear Graham stress people, not families). Then the sneaky part - Graham explicitly links defeat of the amendment to support of Vince the Superhero.
We have two lords now: Lord Roger Roberts, in favour of the amendment, who reveals he’s responding to the very many text messages he’s had expressing dismay with the party’s tax-cutting agenda; and then Lord Tom McNally, who argues that tax-cutting is in the social democratic mould. Lord McNally also uses the Back-Vince-or-else line: “there’s no point giving Vince a standing ovation in the morning if you’re going to kick away the plank from underneath him in the afternoon.” Some cheering for this.
[Apologies, teh internets is on-the-blink here in the LDV Cupboard, so I missed a couple of speakers. Let me assure you they made jolly good speeches on both sides of the argument. Incidentally, the applause for those moving the amendment is markedly more lukewarm since the Vince Pincer movement of Graham Watson and Lord McNally.]
Jo Swinson is up now, speaking from the floor rather than the platform, earning kudos for ‘ordinary memberiness’; repeats the Make It Happen arguments that tax cuts for low earners is a practical way of addressing social justic problems.
[I'm not live-blogging the interventions from the floor, by the way, because BBC Parliament doesn't flash up their correctly-spelled names, and I don't want to commit any faux pas. Suffice to say they're evenly balanced - though all those in favour of the amendment have their own ideas of how the £20 billion of spending cuts could be spent... which is sort of the problem when you start raising taxes: when do you stop?]
[Oh, interesting - Vince Cable has been called to speak. It's clear the leadership wants to win this one. The Vince Pincer earlier wasn't enough: now we get Vince himself to coax and convince.]
Duncan Brack is now up arguing for the amendment, making the not-unreasonable point that announcing tax-cuts before you’ve worked out how they will be funded through spending cuts, and asking how that increases the party’s credibility. Of course, the answer to our credibility gap is… Vince. Speaking of whom…
Vince Cable gets up, a conference hall swoons… “Millions of voters are saying to us, ‘We just want a bit more freedom.’” Vince argues you can’t spell out in detail the spending cuts now with which we’ll go into the general election. He concludes with a clarion call to oppose the amendment. The Hall simultaneously orgasms.
Richard Younger-Ross: “forget the Cameron-effect, have journalists not heard of the ‘Clegg effect’… we’ll gain seats in the north and we’ll gain seats in the south under Clegg’s leadership and with Make It Happen”. Argues that care for the elderly and scrapping tuition fees must come before tax cuts.
Tim Farron puts forward, forcibly, the argument that tax cuts for the poor is about social justice, and notes that a woman in his constiuency on £7k pays £2k in tax. “Labour tax cuts have always been about comforting the comfortable, ours are about lifting the poorest out of poverty”. I’m discovering today what those who attended the rally on Sunday learned: Tim Farron is a terrific speaker. We should hear more from him, I feel.
Chris Huhne: “Helping the hard-pressed, by whatever means, has always been our mission” - a deeply intellectual, well-thought-through speech. Interesting international comparison: he’d happily vote for tax-cuts as a Swedish liberal, and vote to increase them as an American liberal.
Evan Harris is winding-up in favour of the amendment, and starts off with an ice-breaking joke: “Nick you needn’t worry… too much.” He makes a nice point that, under a devolutionary Lib Dem government, the proponents of Make It Happen are arguing for local government spending cuts: “good luck to those of you want to campaign on that platform”. Conference knows what to expect from Evan: a barn-storming, wit-infused speech of passion. Evan knows what to expect from Conference: he’ll be on the losing side.
Simon Hughes, arguing for Make It Happen’s adoption as president of the party and chair of the federal policy committee, notes how the new policies will distinguish us from Tories - whose only announced tax-cuts are for double-millionaires with large estates, and stamp tax on shares: how’s that for helping out ordinary people? Simon sums up the Make It Happen tax message pretty simply: “If you’re very rich you’ll pay more; if you’re not, you’ll pay less.”
The speeches are over, now time for the vote. (You have to be sitting down in the conference hall to vote, I’m afraid: bad luck for those sitting down comfortably in front of their computers).
Result of card vote:
** The amendment is “clearly defeated”. ** (Though not “clearly” defeated if you’re watching BBC Parliament, which decided not to show the delegates in the hall at this point).
** Make It Happen is passed overwhelmingly, with only “a very few” against **
In truth, the result was never really in doubt. Compared with two years ago, when the Lib Dem conference voted to ditch its commitment to the 50p tax-rate for top earners, the switch to proposing overall tax-cuts targeted at the poorest has not exercised Lib Dem activists over-much. Now all we have to do is let the public know what Make It Happen is all about.
Posted in Conference, Party policy and consultation
15th September 2008 at 4:00 pm
What is the exact wording of the amendment?
15th September 2008 at 4:04 pm
Hey Laurence you can find it here in today’s announcements.
15th September 2008 at 4:04 pm
Vince is on fire.
There have been a few really good contributions, and some pretty odd ones. Elaine Baghshaw for Liberal Youth didn’t do the organisation any harm by being more eloquent than most of the MPs either.
15th September 2008 at 4:09 pm
Amendment One
Hemel Hempstead and Oxwab and 16 Reps
After a) (line 8), insert new b) and re-letter accordingly
b) despite extra investment since 1997, Labour has failed to invest in key areas of public services and has imposed unfair charges on individuals
in 1 (line 12) after ’struggling’ insert ‘(funded, as in existing party policy, through a green tax switch and closing tax incentives and loopholes that disproportionately benefit the very wealthy)’
After 4 (line 20) insert new paragraph
Conference further resolves that any reduction in overall levels of public expenditure should be a lower priority than measures to reduce inequality in British society, improving public services, including in particular health, education, child care and public transport, and making the urgent investments needed to tackle accelerating climate change.
15th September 2008 at 4:12 pm
ALternatively see what Alex has just posted.
15th September 2008 at 4:13 pm
Farron is getting very passionate . . .
15th September 2008 at 4:16 pm
Listening to this debate you’d think we were talking about tax cuts of 15p not probably 1-2!
15th September 2008 at 4:20 pm
many thanks indeed for doing this Stephen
15th September 2008 at 4:20 pm
Evan is very funny . . .
15th September 2008 at 4:22 pm
Yeah I second Paul on that. Well done Stephen giving those of us unable to get there, and in some cases unable to watch in live, the chance to get a feel for what is going on in the hall.
Well done indeed Stephen
15th September 2008 at 4:23 pm
“The Hall simultaneously orgasms.”
Damn - it would have been worth paying £100 just for that!
15th September 2008 at 4:24 pm
You’d get a discount at Tory conference though Paul.
15th September 2008 at 4:27 pm
“Evan knows what to expect from Conference: he’ll be on the losing side.”
Bless him. Where would we be without him?
15th September 2008 at 4:28 pm
“the argument that tax cuts for the poor is about social justice, and notes that a woman in his constiuency on £7k pays £2k in tax.”
How? The only way I can think this could happen is because of council tax (CT benefit either not being claimed or she is not eligible because of savings.
She would benefit massively from our plans for LIT to replace Council Tax - but that isn’t really an issue today.
Certainly a person on £7k would pay a income tax of 20% on about £1 so (ie about £200) and would consequently get little benefit from any income tax cuts (about £10 for each 1p of the basic rate)
I suspect Tim may have been using an emotive example that wasn’t really related to the issue under debate.
15th September 2008 at 4:31 pm
they’re running late - is there likely to be a card vote?
15th September 2008 at 4:32 pm
Actually good point Hywel I was thinking that as well. Impossible to pay that much in IT on that salary, possibly in all taxes combined yeah.
15th September 2008 at 4:33 pm
Looks like slam dunk for the motion unamended - much helped by the Vincer Pincer - doesn’t it?
15th September 2008 at 4:35 pm
Some very good arguments being made on both sides, but I must say that having looked at both and having listened to the whole debnate the admentment is better then the original.
The only problem is that if it is passed it will be viewed in the media as a major defeat for Nick Clegg which I don’t believe is the case
15th September 2008 at 4:37 pm
Wahey! Rejoice! Rejoice! Clegg is a genius! There is a God!
15th September 2008 at 4:38 pm
Trust to BBC to miss the action.
Grr, now I guess I’ll just have to fight for the right things to not be cut within the planned budget.
15th September 2008 at 4:41 pm
Never thought I’d be a member of a party which proposed tax cuts. Not 100% sure what I think about this just now - just feels very uncomfortable…
15th September 2008 at 4:41 pm
“Conference further resolves that any reduction in overall levels of public expenditure should be a lower priority than measures to reduce inequality in British society, improving public services, including in particular health, education, child care and public transport, and making the urgent investments needed to tackle accelerating climate change.”
Thank you for posting the text, which I hadn’t actually seen.
So now it’s official - cutting taxes is a higher priority for the party than reducing inequality and tackling climate change.
At least it’s useful to have that made clear.
15th September 2008 at 4:42 pm
“There is a God!”
I’ll quote you on that, Laurence.
15th September 2008 at 4:44 pm
Clegg’s Candid Friend(the Tory trolls are out already) - you’ve reversed the meaning of the quote you muppet!
“Conference further resolves that any reduction in overall levels of public expenditure should be a lower priority than measures to reduce inequality in British society, improving public services, including in particular health, education, child care and public transport, and making the urgent investments needed to tackle accelerating climate change.”
Thank you for posting the text, which I hadn’t actually seen.
So now it’s official - cutting taxes is a higher priority for the party than reducing inequality and tackling climate change.
At least it’s useful to have that made clear.”
15th September 2008 at 4:49 pm
The “Farron woman” could also be paying NI - but that would only be up to maybe another £100.
15th September 2008 at 4:49 pm
Paul Walter:
“Clegg’s Candid Friend(the Tory trolls are out already) - you’ve reversed the meaning of the quote you muppet!”
?
What on earth are you talking about?
15th September 2008 at 4:51 pm
Sorry - forget it
15th September 2008 at 4:52 pm
I’m not clear on what this means, can someone please clarify the clarification in simple bulletpoints.
15th September 2008 at 4:52 pm
“So now it’s official - cutting taxes is a higher priority for the party than reducing inequality and tackling climate change.”
Yes, that’s right. Because, believe it or not, there is only so much we can do towards those ends. That’s why it was absurd to frame the amendment in those terms and why it deserved to be roundly defeated. This is a great day for Lib Dems. We are now officially a party of the centre-right!
(he said provocatively)
15th September 2008 at 4:58 pm
Surely reducing taxes for the lower paid and worse off is a way of reducing inequality in society anyway - isn’t it?
15th September 2008 at 5:01 pm
For those that pay taxes yes Paul.
If I’m not mistaken the taxes also finance the schemes that those without, or little income need to supplement their income. Quite often to a greater extent than say £330 pounds p.a., just going by Tavish’s estimation of 2p.
15th September 2008 at 5:04 pm
Clearly we are a properly liberal decentralising party (except that our dear leader and front bench team thinks a bit more centralisation will balance the current emphasis on local grass-roots and provide a counterweight to the right-left split)?
So multipolar unchaos out of bipolar disorder then?
15th September 2008 at 5:04 pm
Yes, but if you’re really serious about tackling inequality then you need a higher tax burden too. We’ve made the right choice. Government is responsible for reducing inequality but only up to a point.
15th September 2008 at 5:06 pm
Are you talking opportuities or outcomes, Laurence?
15th September 2008 at 5:09 pm
But hang on - just because an amendment is rejected you can’t say that we reject all that was in the amendment. If what was written above was in a motion - that would be a different matter. There are many things in Make It Happen which aim to reduce inequality and improve public services. The amednment and the motion are not mutually exclusive. Just because we are (perhaps) moving civil servants our of London and abolishing BERR doesn’t impact reducing inequality and improving public services. The document, for example, continues our pledge of guaranteed care for the elderly:
“Every citizen will be entitled to a decent standard of care, and the NHS will pay
for you to go private if they can’t deliver your treatment on time, so no-one
gets let down or forgotten. There’ll be guaranteed care for elderly people
too, so we can all afford to be looked after in our old age without having to
sell the family home. We’ll change the rules to give mental health patients
equal rights.
And we’ll put doctors, nurses and patients back in control. People with long
term conditions will be able to make their own decisions about treatment.
Local people will be able to take charge of local health services in England,
standing for election in their own community. And money will be raised
locally too, so communities don’t have to do what ministers tell them and can
have the health system they choose for themselves.”
15th September 2008 at 5:16 pm
It would be interesting to see a list of speakers each way; my impression is that [shockingly for a radical antiestablishment chappie like me] the leadership’s team may outweigh the antis from my perspective!
And very nice to gather that there was a balance of pro/anti speakers - unlike a certain debate at Llandudno 1981 !!!!!
15th September 2008 at 5:25 pm
crewegwyn a partial list does appear to now be on the conference section of the party website but I’ve added it below.
An amendment to the motion was moved by Paul Holmes. Speaking for the amendment were: Richard Grayson, Roger Roberts, Mick Taylor, Duncan Brack, Richard Younger-Ross and Evan Harris. Those speaking for the motion and against the amendment were: Michael German, Graham Watson, Tom McNally, Elaine Blagshaw, Vince Cable, Tim Farron, Chris Huhne and Simon Hughes.
15th September 2008 at 5:26 pm
“There’ll be guaranteed care for elderly people too, so we can all afford to be looked after in our old age without having to sell the family home.”
I have to say that does sound like pie in the sky.
15th September 2008 at 5:35 pm
I agree with the comment made about Tim Farron’s speech being excellent - that was what finally swung it for me to vote for the leadership position.
I think overall it was an excellent quality debate, with Duncan Brack, Richard Grayson, Roger Roberts and Evan Harris all on top form for the supporters of the amendment, while the main motion had excellent contributions from Chris Huhne and Jo Swinson as well as Tim. Simon Hughes’s summing up of the debate was also first class.
15th September 2008 at 5:40 pm
Paul Walter:
“But hang on - just because an amendment is rejected you can’t say that we reject all that was in the amendment.”
There was, essentially, only the single sentence quoted above in the amendment.
Just about the one virtue of this, as far as I’m concerned, is that despite all the fudging and contradictory statements over the past few days, the party has finally made a clear and overwhelming decision on a matter of principle.
15th September 2008 at 6:29 pm
CCF - please can you tell us what ‘clear and overwhelming decision’ was made on which ‘matter of principle’?
I thought this was a matter of strategic policy, not principle.
We are neither ideological ‘big-staters’ or ‘tax-cutters’ and we remain liberal - in fact this shows we are - so what are you talking about?
15th September 2008 at 6:58 pm
Oranjepan
Clearly, that cutting taxes is a higher priority than reducing inequality and tackling climate change.
15th September 2008 at 8:35 pm
Well, not surprisingly Vince Cable has got his way (it would have happened anyway but the blatant rigging of the conference aqenda was indeed a disgrace). I listened to his long speech (but not the debate) and the underlying dishonesty of his argument is astonishing (if very competently done).
The message to the country is all about tax-cuts and the party standing on its head (just see the news bulletins this evening) which (it is thought, wrongly in my view) will help to win middle-class seats in the south by outflanking the Tories on the right. But the message to the party is all about social justice, cutting taxes for poor people. Of course that has to be done and the present taxation of the poor is a shocking disgrace but of course it can be done by redistributing the tax take not by the inevitable cuts in public services which the Cable mantra will produce.
So you dishonestly get the conference to vote for right-wing Tory policies by tickling their radical progressive tummies.
What is scandalous (and the second major dishonesty - and a huge political hostage for the future) is claiming to be able to cut £20billion (more than just a bob or two) from public spending without setting out a costed means of doing it. Or even giving a clear list of things that have been properly worked out. Again just an appeal to the conference’s prejudices on things like quangos and waste.
Cable and the collection of right-wing “economic liberals” who have been given influence in the party are leading us into a political cul-de-sac and (in my view) probable electoral disaster. It is a repudiation of the coalition of voters who have been built up behind the Liberal Democrats in the past ten years and some of them might just notice.
Sooner or later (possibly sooner) there will have to be people around to pick up the pieces.
No-one denies that Cable is an expert on the economy, that he knows more about it than most people, and that he is brilliant at communicating complex ideas in a clear and understandable way. But that does not make him right. (Thatcher had the third of these skills to perfection).
He may (to use an ancient quote from another era) be a brilliant dessicated calculating machine. Unfortunately his personal arrogance and obsession with the technical details of the economy seem to mean that too often he doesn’t see the bigger political picture. I do think the party will come to regret allowing him to lead it by the nose on these matters.
Meanwhile if as Paul Walter says “the party has finally made a clear and overwhelming decision on a matter of principle” there will be a lot of us who decide to take an overseas holiday when the next General Election comes round.
Tony Greaves
15th September 2008 at 8:55 pm
Vince’s credibility must be monumental if he could manage to get away with the “we’ll make well paid public sector employees reapply for their jobs at lower pay” without being completely ridiculed.
15th September 2008 at 9:11 pm
CCF, the two are completely different policy areas so what your comment is a basic misrepresentation of the actual status.
Our priority remains good liberal politics and that encompasses all different subjects even if the focus of daily debate continues to shift - all of us remain fully committed to securing our shared futures, whether than means environmentally, financially or socially. There is no contradiction, only a balance.
Tony, I’m sure we will all miss your assistance as every pair of hands and legs is invaluable to aiding the cause of liberalism, and I’m sure you fully understand how ongoing dissent degrades the constructiveness of any contributions. However, I must question your interpretation of what honesty means and your exaggerated claims for the unfairness of any influence exerted through the progress of this debate - your belated entrance into discussions here smack of bitterness rather than any commitment to engagement with the issues.
15th September 2008 at 9:27 pm
Conference rejected an amendment proposing that cutting spending [i.e. taxes] should be a lower priority than reducing inequality and tackling global warming.
The implication is obvious. Why on earth can’t people have the honesty to admit it?
And talking of dishonesty, I’m glad I wasn’t the only one who was nauseated by the sight of speaker after speaker invoking the plight of the poor in order to justify what Clegg has described as “the most radical package of tax- cutting measures for people on middle incomes”.
When the cuts in public spending and the switch to indirect taxation are actually going to make life harder for the poorest, who pay little or no tax, and will get little or no benefit from tax cuts!
15th September 2008 at 9:46 pm
Surely, CCF, as the party of equality all our priorities are equal.
I think your emotional reaction says several things - firstly, that implications recieved are determined by personal bias, secondly, that it is extremely difficult to convince people who allow themselves to be swung by prejudice, and thirdly, that we still have much work to do improving the way we get factual messages across even to some of our own audience.
15th September 2008 at 9:48 pm
Is it not possible that as well as rejecting the amendment, Conference also rejected its premise?
15th September 2008 at 10:04 pm
Oranjepan
Why not - just for once in your life - try to put up a logical argument in support of your position, instead of just attacking the people who disagree with you?
Can you explain how cutting the basic rate of income tax benefits someone who doesn’t pay income tax? Do you not agree that increasing indirect taxation is going to worsen the situation of that person?
15th September 2008 at 10:39 pm
CCF, that is not the full equation - you are not looking at the full package of proposals.
For someone who doesn’t currently pay income tax, shifting Council Tax to LIT will lift a huge burden from their shoulders and wholly outweigh any tinkering with differential rates of indirect taxation by a large and disproportionate extent.
Now, I’m not fully signed up to LIT as the ‘final solution’ to funding local councils, but this new package is a massive step forward in trying to satisfy all groups simultaneously.
I am also highly impressed by the thinking behind the ‘tax switch’ argument.
In the past we have been derided for trying to escape the false dichotomy between the ‘tax ‘n’ spenders’ and ‘tax cutters’ by discussions of hypothecation or suchlike and have been bogged down by endless inconclusive discussions of how this restricts choice.
The ‘tax switch’ idea forces us to look at budgeting differently - it is not just a question of the size of the budget, but also of looking at how and why we tax the things we do and how and why we fund initiatives.
15th September 2008 at 10:53 pm
“Vince’s credibility must be monumental if he could manage to get away with the “we’ll make well paid public sector employees reapply for their jobs at lower pay” without being completely ridiculed.”
He got clapped for saying this though even on the TV there was a sense of some embarrassment. It is of course completely bonkers. All public sector employees over £100,000 - how on earth would the government enforce that let alone get away with it? But it was part of the trick of tickling the conference’s left wing prejudices in order to get them to vote for a right-wing policy.
As for “Oranjepan”, it may be that people here know who you are but I don’t. The difference between you and me is that I post under my own name and you post under a stupid nickname.
“your belated entrance into discussions here smack of bitterness rather than any commitment to engagement with the issues.”
So if I don’t spend my whole life reading this website and posting my views, I am not “committed to engaging with the issues” whatever that silly language means! I’m not sure what I have been doing these last 50 years!
I don’t know who you are but you seem to me to be a bit of a prat!
Tony Greaves
15th September 2008 at 11:11 pm
“CCF, that is not the full equation - you are not looking at the full package of proposals.
For someone who doesn’t currently pay income tax, shifting Council Tax to LIT will lift a huge burden from their shoulders …”
That’s a complete red herring. The debate today had nothing to do with local income tax.
It was a question of which should have higher priority - cutting taxes or spending to reduce inequality. The plight of the poor was continually invoked in favour of tax cuts, despite the fact that cutting income tax will do nothing to help those who don’t pay income tax!
If the party wanted to help the poor, there would be much more efficient ways to target that help than by cutting the basic rate of income tax.
But of course the whole point of this is not to help the poor, but to attract the support of middle-class voters in Lib Dem/Tory marginals.
15th September 2008 at 11:18 pm
“For someone who doesn’t currently pay income tax, shifting Council Tax to LIT will lift a huge burden from their shoulders …”
Probably not the case if they claim Housing Benefit on their council tax.
“But of course the whole point of this is not to help the poor, but to attract the support of middle-class voters in Lib Dem/Tory marginals.”
And this is one of the fallacies at the heart of the policy: it probably will not do so for a lot of them when the numbers are finally added up (the numbers necessary to do this and everything else are quite improbable) and even if it does, the effect of the policy is likely to lose the support of progressive LD voters without gaining Cameron Tories in any numbers.
Tony Greaves
15th September 2008 at 11:39 pm
Nice one Tony, I’m so glad you took the time out of your long and dutiful service to respond so politely and constructively.
Since when does it matter who you are when the substance of what you say is what is at stake?
CCF, I agree that this wasn’t in the formal debate in the conference hall, but nevertheless it isn’t a red herring.
This conference has been about professionalising our attitude towards our politics at every level.
There is a serious political gambit being played by TeamClegg in which we are unfortunately but necessarily calculating that the potential gains from deliberately stimulating a fight between the dinosaurs (like Tony) and reformers (the Orange bookers) are greater than playing safe with traditionally safe assumptions on issues like tax, for example.
If this means we have to deploy dual messages and sacrifice clarity in putting the liberal case then we must accept the challenge and step up to the plate.
Either we are reformers who are prepared to reform ourselves or we will wither away in the winds of political fortune.
15th September 2008 at 11:42 pm
Oh, and personally I think there is more electoral traction to be had among non-voters than middle-class swingers. I think we are starting to address this point.
16th September 2008 at 12:10 am
“If this means we have to deploy dual messages and sacrifice clarity in putting the liberal case then we must accept the challenge and step up to the plate.”
Judged by his performance over the last few days, “deploying dual messages and sacrificing clarity” is Nick Clegg’s natural forte.
16th September 2008 at 12:28 am
I do not think that income tax cuts will make a great deal of difference to many of the poorest, who do not pay it, and it would be better to cut regressive taxes like VAT. I will watch for more detailed proposals, but at the moment, after 25 years as a member of this party and its predecessors, as an ertswhile Cllr and Parliamentary Candidate, I am now seriously considering where my future loyalties will lie. I have been relatively inactive during the past year, mostly for personal reasons, but also because I have become increasingly worried by some of the nonsense promulgated by the new leader. I am now so concerned that I have resolved definitely to not campaign for the party at all until after the next election. I will maintain my membership/voting rights until then, and review the political situation at that point, before deciding whether to remain a supporter, or support/join another party. Ironically, I will probably vote Liberal Democrat, since we are closest to the Tories in my constituency.
Incidentally, Tony - the folk who hide behind stupid names are probably those who wish to stand for Parliament. They remain anonymous on fora like this for fear their right wing views will alienate a sizeable number of the members who (for the moment) still select candidates in our party.
16th September 2008 at 8:15 am
I resign my position as Chairman of Rushcliffe Liberal Democrats with immediate effect.
I did not join the Lib Dems to kid people that money grows on trees, and that Nick Clegg is the new Santa Claus.
I did not join the Lib Dems to dismantle public services and return them to the state that John Major left them in.
I did not join the Lib Dems to set up a two-tier health service where the rich buy the drugs they need and the poor die.
I have loyally served under five leaders of honesty, integrity and principle: Roy Jenkins, David Steel, Paddy Ashdown, Charles Kennedy and Ming Campbell. The sequence has been broken.
Wake up Lib Dems. If you are not ashamed of what you have done, you should be.
16th September 2008 at 8:37 am
The notion that the poor would not gain from a cut in the starting rate of income tax is absurd. Has anyone advancing such an argument ever actually been poor? Income tax kicks in once you’re earning a little over £110 per week which is a little over 20 hours at minimum wage. A person working full time (or in two part-time jobs etc.) at minimum wage would therefore be paying income tax on almost half of their total income. These are people who are either officially in income poverty or only just above it and a long way short of the average income. Cutting taxes is no panacea, but it does help.
Tony Greaves wrote:
You don’t claim housing benefit on your council tax. You claim council tax benefit on your council tax. I have to admit that I don’t have the precise sums to hand, but I’m working from first-hand experience a few years ago when I say that council tax benefit does not cover the entire council tax bill and is allocated separately from the housing benefit which is designed to cover rent and other housing costs. If LIT eliminated council tax, council tax benefit could be abolished and still leave the person/family concerned better off by not having to pay that portion of their council tax bill not covered by the benefit.
16th September 2008 at 9:41 am
“The notion that the poor would not gain from a cut in the starting rate of income tax is absurd. Has anyone advancing such an argument ever actually been poor? Income tax kicks in once you’re earning a little over £110 per week which is a little over 20 hours at minimum wage. A person working full time (or in two part-time jobs etc.) at minimum wage would therefore be paying income tax on almost half of their total income.”
So suppose we put £5bn into tax cuts, and reduced the basic rate of income tax by (say) another 1p. What does that do for such a person? I reckon it makes them better off by about £1 a week.
Deep tax cuts aimed at the poor? Don’t make me laugh!
If you really wanted to benefit the poor, you could target the money directly at them in any number of ways, rather than spraying them across Clegg’s 80-90% of the population. And you could target some of the money at those who don’t pay tax at all. If you targeted £5bn at (say) the poorest 10% of the population, it would make them something like £1000 a year better off.
That’s the kind of thing you’d do if you had the real burning concern about poverty that was simulated in the debate yesterday. But this isn’t about poverty. It’s about trying to sucker in middle-class voters with promises of painless tax cuts and cost-free public services.
16th September 2008 at 9:51 am
Terry Gilbert:
“I do not think that income tax cuts will make a great deal of difference to many of the poorest, who do not pay it”
Can we please nail this? You start paying tax above earnings of (this year) £6,035, and National Insurance on even less. Many people who are “poor” by any standard you care to use *do* pay tax.
16th September 2008 at 9:56 am
Alix:
“Can we please nail this? You start paying tax above earnings of (this year) £6,035, and National Insurance on even less. Many people who are “poor” by any standard you care to use *do* pay tax.”
Did you not read what the poster wrote?
(1) He wasn’t talking about all of the poor, but many of them.
(2) He didn’t say the people in question didn’t pay tax, or even that they didn’t pay income tax. He said income tax cuts wouldn’t make a great deal of different to them.
Do you really think a cut of 1p from the basic rate of income tax would make “a great deal of difference” to someone on the minimum wage?
16th September 2008 at 10:00 am
CCF: I don’t disagree with the notion of redistribution that you advocate, although I think your sums are a bit off and you don’t say how you would deal with withdrawal rates (what happens when people move just out of the bottom 10%).
Personally I’d be happier with a more redistributive package. I’m intrigued by ideas like the ‘basic income’ or ‘negative income tax’ which would achieve something much closer to what you describe. I’m equally very dubious about the idea that spending money on government services helps us here, and that’s what I see the dividing line as being: who makes the spending decisions, government or people? Insofar as we can, I think that we want to put those decisions in the hands of individuals by cutting some central spending where we can. In the long term, I’d like to see that approach go further and closer to what you describe: directly putting resources into the hands of people who need them rather than spending it (allegedly) on their behalf. We’ve seen what happens when the government does that: they spend it on ID cards or Trident instead of the priorities of normal people and the only way to fix that is to put the money in the hands of people.
I’m all for improving our policy platform and I think that there are plenty of opportunities for radical thought here. If there’s anything wrong with the debate in Bournemouth is that it draws from too few different ideas and doesn’t consider more radical approaches to redistribution. If we want to decentralise control properly then we have to cut the amount of money spent at Whitehall in order to create the fiscal space for local councils and, for that matter, individuals to spend on their more specific priorities. I happily admit that the current policy doesn’t really get us to where I’d like to be, but I think that it points in the right general direction.
16th September 2008 at 10:07 am
“Do you really think a cut of 1p from the basic rate of income tax would make “a great deal of difference” to someone on the minimum wage?”
No, but releasing them from income tax and “NI” altogether would.
Autumn 2009, perhaps.
16th September 2008 at 10:17 am
CCF: you wrote “Did you not read what the poster wrote? (1) He wasn’t talking about all of the poor, but many of them”
But Alix too was talking about “many” rather than “all”: “Many people who are “poor” by any standard you care to use *do* pay tax.”
Where have you got the idea that Alix was talking about “all” from?
16th September 2008 at 10:17 am
I agree, I think it’s far more likely that we raise the PA. I hope so anyway. Ideally the endpoint would be raising it to the NMW.
16th September 2008 at 10:20 am
Rob Knight:
“I think your sums are a bit off”
Obviously they’re very rough, but I don’t think they’re hugely off.
Whatever the exact figures, the point is that the “vast bulk” (to use Clegg’s phrase) of any cut in the basic rate of income tax would go to the middle class, not the poor. That would also be true if the threshold were raised, though obviously that would be a bit more beneficial to the poor.
Of course if something more redistributive were done that would be better, but I listened to most of the debate yesterday, as well as Cable’s speech, and I heard no hint that the tax cuts would be targeted specifically at the poor, despite all the hand-wringing about their plight.
And of course the whole point of this is clearly to attract middle-class voters. Clegg has said that 80-90% of the population would benefit, and has described this as “the most radical package of tax- cutting measures for people on middle incomes”. And after all, the “green switch would go into reducing the rate of income tax, not anything more redistributive.
It’s the hypocrisy that annoys me more than anything.
16th September 2008 at 10:23 am
CCF, what were your workings on the 1p/£1? And do we know that a cut in the basic rate would be the measure chosen to effect cuts?
16th September 2008 at 10:27 am
Mark Pack:
“But Alix too was talking about “many” rather than “all”: “Many people who are “poor” by any standard you care to use *do* pay tax.”
Where have you got the idea that Alix was talking about “all” from?”
From the fact that she said she was “nailing” what the poster had written (the ugly implication being that it was a lie) by saying that “many” of the poor pay income tax.
Unless the poster had implied none of them did, that obviously wouldn’t “nail” anything.
16th September 2008 at 10:36 am
CCF: that’s not really an answer to my question. Alix wrote “many”, you say she meant “all”. Those aren’t the same words, and those don’t mean the same thing. It’s a shame that in this (as in so many other threads) you seem so determined to misquote other people and then say, “that’s daft!”.
If someone says “many” why not accept that they meant “many” rather than insisting they must have really meant something else?
16th September 2008 at 10:37 am
“CCF, what were your workings on the 1p/£1?”
Well, roughly speaking someone on the minimum wage would be paying tax on £5000-6000 of their income. I’m not a tax accountant, but I’d say that 1p off the basic rate of income tax would be worth £50-60 a year to them, which seems to be about £1 a week.
But suppose we do raise the personal allowance. That means everyone paying income tax gets an equal share, unless it’s offset in some way. Suppose a quarter of this £20bn is handed out in this way. What will that amount to? Maybe £5 a week? The “vast bulk” again going to the middle class.
16th September 2008 at 10:44 am
Mark
I don’t have time for this silliness, frankly.
Alix misrepresented what the previous poster had said in two ways. I pointed that out.
Naturally you come in on her side, and start accusing me of “misquoting” her. If I misquoted her, kindly repeat the part of my post where I did so. Otherwise please retract what you said.
16th September 2008 at 11:15 am
How did you arrive at the 1p? I’m not saying it’s wrong, I just don’t know how you did it.
Raising the PA would have a greater effect than dropping the BR by a further penny. I’ve just done rough figures that throw up a decrease of only £40 a year for someone earning around £10,000 if you drop our existing cut from 16p to 15p.
Using the £5bn for an increase in the PA in stead - and taking as a recent benchmark of £2.8bn paid out by Labour to raise the PA by £600 over and above the usual inflationary increase - we could estimate a £1,000 increase on the PA above inflation. This would leave the £10k earner more than £150 pa better off, which is much more of a step in the right direction.
This is because raising the PA - while it does, as you say, benefit everybody - benefits disproportionately those who are not all the way through the basic rate. The less further your earnings slip into the basic rate, the less you will benefit from a basic rate cut, but the more you will proportionately benefit from a raise in the PA.
Germane at this point to observe that I’m already on record as being disappointed that we didn’t reduce our basic rate cut and raise the PA instead. I’ll certainly not be happy if don’t use any further money to increase the PA, preferably to the NMW.
However, I don’t see the fact that a raise in the PA would benefit everybody as a problem in the same way you do. This is a fairly key liberal point, to my mind. It’s economically illiberal to artificially meddle with a sliding scale. The gradient may need to be made steeper, but that’s another matter, and that’s what the tax package sets out to do.
16th September 2008 at 11:16 am
Julian H makes a good point - which is consistent with CCF’s calculations. This is why I will wait for detailed proposals (and to see what happens at the next election and beyond) before deciding whether or not I should go. Raising the income tax threshold, and more importantly, tapering the loss of unemployment benefits, as Brown has tried cack-handedly to do with tax credits for certain groups (mostly families) would do much more than a 1p cut in income tax.
Those who voted for the amendment yesterday, or were tempted to do so and swayed at the last minute, should now be organising to put pressure on the party leadership to bring forward detailed proposals which are more acceptable. Amendments to conference motions are all very well, but it is inevitably too late, because defeating the platform ensures that the media protrays us as disunited; we must sharpen our focus and ensure that the leadership is too terrified to bring forward regressive changes for fear of defeat. Go to your AGM and elect conference reps who will vote for progressive taxes. I hope that people like David Allen will stay in the party and campaign for the progressive agenda.
16th September 2008 at 11:28 am
Alix:
“However, I don’t see the fact that a raise in the PA would benefit everybody as a problem in the same way you do.”
(I note your figure of £3 a week from raising the personal allowance is even less than my guess of £5 a week.)
The point I’m making is simply that it was dishonest to sell these tax cuts as a means of helping the poor when the vast bulk of the money would go to the middle class (whether it was done through reducing the basic rate or raising the personal allowance).
The benefit to low earners would be small, and the benefit to those not paying income tax would be nil.
And remember that these people would be hit disproportionately by the intended shift to indirect taxation and - unless we could achieve the miracle of painless economies, which has eluded every government in living memory - by public spending cuts.
16th September 2008 at 11:30 am
Alix - you seem to be one of the few open minded people here!
Clegg has been on the news repeatedly over the last couple of days saying £20bn in savings from scrapping a couple of departments, the ‘bulk’ of which goes towards our spending commitments. Whatever is left goes to tax cuts. I think £5bn is the roughly the figure necessary for a 1p across the board income tax cut. It is certainly in the right ballpark, from memory. At most it would be £10bn or 2p in the pound - even a 4p cut would only save the poorest £4 a week. Of course it would save higher earners rather more, as they pay tax on more of their income. The more you pay the more you save. We must start pressing NOW for a fairer way to be brought forward at the next conference. Our leaders are democratically accountable, and they must be in no doubt about the mood of the party by the time of the next conference.
16th September 2008 at 11:38 am
Terry Gilbert:
“Our leaders are democratically accountable, and they must be in no doubt about the mood of the party by the time of the next conference.”
But do you really think the leadership will wait for conference to decide how these tax cuts should be distributed?
Surely it’s apparent from the events of the last couple of weeks that Clegg is determined to present us as the party of middle-class tax cuts. I don’t believe for a moment he will risk that being frustrated by conference.
I’m sure it will all have been pre-announced well before then in a blaze of publicity - just like “Make It Happen” - and the party will be told to fall into line again.
If Clegg could claim earlier this year that we might be only “months away” from a general election, he will certainly be playing that card to the utmost by next year…
16th September 2008 at 11:56 am
“even a 4p cut would only save the poorest £4 a week.”
An income tax cut will not save “the poorest” anything because they are not earning enough to pay any tax to start with.
There is an issue about people on low incomes paying tax and whether they should be taken out of the system. Similarly we have proposals to help the very worst of pensioners
However those aren’t anything to do with tax cutting. The continual references to benefiting “the poorest” are irrelevant and just pure spin.
16th September 2008 at 12:37 pm
Because I’ve done one rough calculation on the back of an envelope, please don’t grab the figure and run around with it. Tax doesn’t behave in that flatline way. Stand by, for I will now bore you:
My £150 per year, you’ll note, was based on earnings of £10,000. What I perhaps should have said as well is that this constitutes a reduction in the taxpayer’s actual liability by a fifth. If you do the same calculation calculation for earnings of £8,000, the saving is just under £80 a year. But in both cases, the proportion by which tax is being reduced is one fifth (obviously: 20-16 = 4).
This is a substantial proportion of tax being returned. The fact that they earn so little in the first place is the problem here. Low earnings are what is dictating the amount of tax they stand to get back, and it’s what makes a benefits system necessary. And last time I looked there wasn’t a single benefit that wasn’t retained or increased in Liberal Democrat policy, except for cutting off the top end of tax credit recipients.
To clarify, the original tax burdens (excluding national insurance) were £793 falling to £634 for the £10,000 earner, and £393 falling to £314 for the £8,000 earner, based on this year’s tax rate and personal allowance (it’s a dead easy sum: £salary minus personal allowance of £6035, then tax the result by 20%).
If, after giving the 16p cut, you were to increase the personal allowance in the way I suggest above to around £7,000 (ignoring inflation at the moment), this would bring the £10,000 earner down further to £480 tax per year, and the £8,000 earner down further to just £160 tax a year. This consitutes a reduction in the tax burden of the £10,000 earner by just under 25% (£480 as a percentage of £634) but the burden of the £8,000 earner would be reduced by 50%.
So like I say, I’m a fan of raising the personal allowance from this point on. Terry, I agree with most of what you say and I’ll be very happy to work with anyone else interested on putting pressure on the party to raise the personal allowance instead of a basic rate cut (if this is what they have planned).
Hywel, I think I’ve dealt with your point in dealing with Terry’s/CCFs. Plenty of poor people *do* pay tax. It *is* worth reducing the rates. But it is *also* worth taking more people out of tax altogether, which I plan to fight for, and it is *also* worth maintaining and enhancing the benefits system, which is party policy already. I actually don’t think we disagree on this, but I think what I don’t see is why you objject to the current plans, which seem to me to meet your requirements so far.
Bore over, should actually go and report something…
16th September 2008 at 12:48 pm
It wasn’t you who made the point so I don’t think we disagree. There are good reasons for tax cuts and they benefit people who need help.
However it is dishonest for some (not you) to portray the MiH tax cut proposals as benefiting “the poorest”
16th September 2008 at 12:51 pm
Alix
Well, thanks for that, but it really only goes to confirm that whether the basic rate were cut or the personal allowance were raised, the bulk of tax cuts would go to the middle class, the benefit to the low-paid would be small and the benefit to those who don’t pay income tax would be nil.
That’s why I object to these tax cuts being sold to the party as a way of tackling poverty. If tackling poverty were really the priority there would be far better ways of doing it - ways that would direct the money to the poor rather than spraying it over 80-90% of the population.
16th September 2008 at 12:57 pm
And at the risk of Mark Pack coming back and accusing me again of “misquoting” people, it is simply no answer to say that many poor people do pay income tax. No one is suggesting that none of the poor pays income tax.
The point is that many of the poor do not, and those who do don’t pay much and so won’t benefit much from income tax cuts.
16th September 2008 at 1:28 pm
Hywel - for the sake of clarity, clearly it will only affect income tax payers so I meant ‘the poorest among income tax payers’. Perhaps I should have made this clear.
Alix - I’m glad to have your support, but I’m afraid that the party leadership is bent on cutting income tax RATES, which benefits the richest (income tax payers) far more than the poorest (income tax payers). I was very concerned when they announced this as part of the Green Tax Switch. Now they are saying they want even more reductions to benefit those on ‘lower AND MIDDLE incomes’. How else would they do this without reducing tax RATES? If Vince and Nick can come up with a convincing plan, which does not include another income tax RATE cut, I will support it.
16th September 2008 at 1:36 pm
I think that there is a big risk in getting confused over terminology here. When we talk about ‘the poorest’, what do we mean? The bottom 10%? Anyone below the average salary (49% of the population, by definition)? Certainly in the big picture our tax plans reduce taxation on those at the lower end overall, which has two effects:
1) As has been pointed out, many poor (by which I mean people in statistical poverty, below 60% of average income) people do pay some income tax and any cut in that tax will benefit them to some extent. CCF makes a reasonable point in saying that it’s hardly a huge cut, but that’s still not a reason not to do it in my opinion. Small amounts of money can make a big difference when you haven’t got any.
2) It raises the benefit of increased earnings, going some way towards easing the ‘poverty trap’, whereby people who move up from the very bottom of the income scale can find that a large proportion of their new, slightly higher, earnings are eaten up by withdrawl of benefits and payment of taxes. This is a good thing for those who are just starting to take steps out of poverty and these are certainly people who most of us would regard as ‘poor’ in comparison to the great success that some people find in our society.
Would we like more redistribution? On the whole, yes, I think we would. But this can only be achieved by freeing up money that is currently simply being spent centrally by the government, along with some increase in the amount paid by the genuinely wealthy (hence the attack on tax loopholes). As a first stab at this, I think the new policy isn’t bad. It balances a number of difficult challenges, including the need to provide some relief to those people whose household budgets are becoming unworkable with the new fuel and food price shocks.
In the long term, I think that cutting income tax at the bottom end is a good idea insofar as it benefits those who are simply trying to get on with their lives, pay their way and support themselves and their families/communities/whatever. For this reason I’m a bit dubious about LIT and am more inclined towards LVT.
I also think that we can have this discussion without the need for accusations flying around. Nobody is going to impress anybody by ‘winning’ an argument on the internet, so please stop trying.
16th September 2008 at 2:24 pm
“Since when does it matter who you are when the substance of what you say is what is at stake?”
In my view it is a fundamental part of open democratic debate that people take part as individuals. In order to assess what people say we need to know who they are and what they are. Using silly nicknames on the internet has debased public debate generally but if we are debating matters within this party it should not be allowed.
Basically it’s sneaky, undemocratic, a denail of the fundamental liberal affirmation of people as individuals in all their complexity.
If you are not even prepared to be honest about who you are, what else is there?
Tony Greaves
16th September 2008 at 2:26 pm
CCF: Hmm, I detect a pattern when you wrote, “I don’t have time for this silliness, frankly.”…
For example, a quick search also finds you saying to other people:
“I really can’t believe you’re having as much trouble understanding plain English.”
“No one can really be as naive as you’re coming across.”
“I really _can’t_ do any more to make it clear to you.”
“I honestly don’t know how I could have made it any clearer.”
“I suspect any attempt at rational discussion here really is pointless.”
16th September 2008 at 2:38 pm
“You don’t claim housing benefit on your council tax. You claim council tax benefit on your council tax”
This is true now (did not used to be) though I think if you are claiming housing benefit you claim the two together. It is however not relevant to my argument.
If you are poor enough the Council Tax benefit is 100%.
To be clear about what I think should be done, I am in favour of raising the thresholds at which income tax is paid quite substantially, I am in favour of a low “starting rate” (the 10p argument), I think that income tax is not too high and that the standard rate should not be cut at all (except as part of a package to balance introduction of LIT) and I think there should be a top of rate of 5