Caron threw down a gauntlet in her article on Ed’s conference speech.
Most of the comments seem to have been negative on two main grounds – that the radical proposals on taxation had been bounced on the party and that whatever gains are made from Europe should be spent by the state. While I agree with much of what is said about Ed – the failure to inspire, the lack of ability to clearly define what Liberalism is, the instinctive tendency to see every vote of protest and none of purpose, in this case I suspect that a very cautious man played a blinder.
It is no great secret that the Burnham government is desperate for ideas to kickstart Labour. It is no secret that the freezing of thresholds has had a disproportionate impact on the poorest in our society and is felt to be deeply unfair. It is also no great secret that this idea has been swirling in the political ether for some time. So is it not simply possible that Ed knew that this was either going to happen in the budget or was a very serious runner?
He therefore took a policy which Labour wanted to trumpet as a flagship change and identified it once again with us – that of raising thresholds.
So the Chancellor faces a problem, he either doesn’t enact the policy. In which case we identify ourselves and not Labour as the party addressing the cost of living crisis with an immediate real impact on the poorest paid. Or he does. In which case he is enacting a Liberal Democrat policy proposal and highlighting it.
The Chancellor has another problem which we as an opposition party do not face. He has to pay for it now. It is highly likely he will fill the gap with Capital Gains Tax increases. We on the other hand once again highlight the price we pay for not being in Europe. The real price, paid from our pockets.
So on this issue I congratulate Ed.
There is too often in this thread an assumption that public expenditure ‘good’, private gain ‘bad’. There is a steady stream of proposals to spend money, never accompanied by any proposition as to how these are to be paid for. There is also a further assumption that the state is always the best provider – again never evidenced.
If Ed’s speech acts as a salutary bucket of cold water to this then so much the better. A policy which gives the poorest paid in our society a real increment and a fraction more choice in what they can spend and how, as opposed to those dreaded words ‘I am from the government and I am here to help’ seems to me a splendidly sound and Liberal policy.
* Hugh Andrew is Managing Director of Birlinn Ltd, one of Scotland's largest publishers. He served as Convenor of the Scottish Policy Committee.
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4 Comments
Very well written Hugh, it fills pretty much what I have been thinking. By paying less in tax the individual should be given the means to see themselves through the cost of living crisis. The out of control welfare budget is going to keep growing unless the Government finds the courage to start looking for cuts. I cannot see Burnham seizing the iniative so people will start to question the level of tax they are paying. But Davey will have to be more active and inspiring and that is still a concern. But it does put us right in the middle of the fight,where we need to be.
“A policy which gives the poorest paid in our society a real increment” It doesn’t. Those with income less than 12,570 would get nothing.
I don’t have a problem with giving basic rate taxpayers a £680 tax cut.
But I don’t understand why would give the top 20% of earners a £1600 tax cut.
Why do we think a senior hospital manager needs a tax cut big twice as big as a nurse?
Essentially the tax system needs fundamental reform, but the party is instead producing short term political expedients. That’s why raising the tax threshold will benefit high earners more than those on low incomes.
The party needs to answer the fundamental question of what we expect the state to do. Currently the UK state is doing a myriad of things but doing them poorly. We either need to do less, or pay higher taxes. Neither growth, either from a closer alignment with the EU, or from other sources, can resolve that issue.