Has Making it Happen made it happen for the Lib Dems?

Well, if the press and media reaction is anything to go by, the launch of the Lib Dems’ Make it Happen policy paper has succeeded way beyond the party’s expectations. No need for LDV to round them all up, as Centre Forum’s Freethink blog rounds up the newspapers’ responses, while Julian H’s Orange By Name has the blogosphere’s first reactions.

Why such a media splash? (And I admit the term splash is relative; but the tendency of political reporters to ignore a party which attracts almost one-quarter of the national vote means we Lib Dems get a little excited by even a handful of reports on the news pages).

Partly it’s that the economy is currently Big News, and the Lib Dems’ call for lower taxation and public expenditure cuts fits in well, and gives a fresh angle. Partly it’s that it’s summer, so political stories are thinner on the ground. Partly it’s that – for those reporters who’ve not been following Lib Dem thinking for the last two years – the party championing lower taxes seems counter-intuitive. Partly it’s that the Lib Dems again (and some might say at last) have a distinctive policy programme, placing clear gold water between the Lib Dems and the Labour/Tory parties.

The most acute critical commentary so far comes from The Times’s Daniel Finkelstein at Comment Central. Now I don’t regularly take Danny’s critiques of the Lib Dems wholly at face value: as an ex-SDPer-turned-Tory he has the zeal of the convert which frequently blinds him to the Lib Dems’ virtues. But he does at least think about politics, which is all too rare among political commentators.

His critique takes two overlapping forms: first, that the Lib Dems’ push to stake out a low-tax, smaller-state is too late – the time to push ahead with it was in 2001-03, when the Tories were at their most demoralised. Now with the Tories back in business it’s impact is lessened. And, secondly, that its principal effect will be further to detoxify the Tory brand – because Gordon Brown’s mantra of ‘Labour investment versus Tory cuts’ will seem increasingly irrelevant with ‘even’ the Lib Dems now favouring cutting taxes and public expenditure. Hence Danny’s conclusion:

I think, therefore, that Clegg’s move is very significant. It’s just that I am not sure that it is very significant for him.

I think there’s something in both arguments. But of course it’s much easier now to make the case that Labour has mishandled the economy – taxed too highly and wasted the proceeds – than it was five or six years ago, when the UK economy was cruising and Mr Brown was still lauded (and not only by himself) as one of the most successful modern chancellors. Besides, I’ve never given much credence to the idea that the Lib Dems will replace either the Tories or Labour as major parties: far more likely that all three will jostle for national prominence for many years to come. And the Tory brand would gradually be decontaminating itself now, in any case, as memories fade of John Major’s disastrous government, and people grow angrier by the day with Labour’s misrule.

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  • Rob Blackie 18th Jul '08 - 6:59pm

    Great article Stephen.

    My barometer of success is my colleagues. A number of them have gone out of their way to come and ask me about it in the last few days – which is a good sign at least that the message has been heard by people.

  • David Heigham 18th Jul '08 - 7:19pm

    Little by little, ray by ray, our current leadership collectively are beginning to show clear golden sunshine between the LibDems and the Labour Tory dogfight. Make it Happen has hit a moment when the mediatic fog is thinner than usual. Another 12 months of these steps edging into the light could make politics very interesting, but Labour and Tories are going to start spinning up serious smokescreens soon. It is not going to be easy even if our leaders remain so relatively sure-footed.

  • The best thing about this is the knowledge that George Osborne will be sucking lemons over this as his position becomes ever more squeezed.

    He has already performed the miracle double back-flip with salchow and twist to avoid making any firm economic promises, but just as he sights the landing the floor falls away and a big hole in the earth starts to swallow him up.

    Gideon will shortly be wishing he is in the backbenchers saloon exchanging frosty stares with David Davis, while commiserating with Grant Shapps over Gordons Tonic.

    They couldn’t see it coming, oh dear!

  • Martin Land 18th Jul '08 - 9:11pm

    I think I wiil just reply by a copy and paste of the remarks I made on Iain Dale’s site in response to his article in the Telegraph today.

    ‘I voted for Nick Clegg as leader hoping for a radical change and that’s what we are getting. I think some of you commentators, Iain, forget that none of this would have been announced without Vince Cable having given his go ahead, and Vince is hardly an ‘Orange Book’ liberal.

    What people are missing is that Clegg is different to every other leader we have had in the post war period in that he represents an urban area where he is much more aware of the pressures that people are under at the moment. These proposals are intelligent and designed to reduce a burden that is no longer acceptable. Liberals are caring people and I think you will be surprised at how muted the criticism’s will be.

    The party is dominated by its councillors. These are people who like to have money to spend, but they are also people in contact with residents on a daily basis and are well aware of the increasing levels on hardship.

    Parties change and evolve. As the Tories become a parody of new Labour, something was bound to change – nature abhors a vacumn.’

  • Martin Land:
    “The party is dominated by its councillors. These are people who like to have money to spend, but they are also people in contact with residents on a daily basis and are well aware of the increasing levels on hardship.”

    As I said on another thread, I’d be really interested to hear the opinions of Lib Dem councillors on the proposed 3-4% spending cuts.

    The only one I’m aware of so far ended “Been a member since 1973 and am a serving councillor but for how much longer…”

  • Oh, and you say councillors “like to have money to spend”.

    Another way of looking at it is that they understand the necessity of having enough money to fund vital publc services that ordinary people rely on.

  • It’s a generational shift.

    We’ve recently retired some 70+ yr old councillors and replaced them with 20-40 yr olds. The benefit of this is that there are less excuses that time must be spent looking after grandchildren and more ground can be covered delivering leaflets.

    3-4% spending cuts is small fry in overall spending really, and anyway it is hard to imagine that local government could absorb further reductions beyond present demands for efficiency when services are already stretched to the bone in many areas (one thinks of mental health services).

    It is well past the time that the mandarins of Whitehall learnt their lessons and applied them to their own departments.

  • Oranjepan

    When I suggested on another thread that it was what you call a “generational shift”, I was accused of being patronising. But your comments confirm exactly what I was saying. I asked whether any of the posters supporting this new policy were older than I am (45). If there are any, they haven’t said so.

    And I asked if any of our councillors felt that a 3-4% spending cut would be feasible for local government. Your answer is “no”, apparently, because spending has already been cut to the bone (but it will be a mere bagatelle for government as a whole).

    And regarding your comment that more leaflets can be delivered if we get rid of older councillors and replace them with younger ones, I must say I don’t see how it works at all (unless the idea is that some of our younger members are prepared to deliver leaflets only if they are made councillors!)

    I can only repeat that in my ward, I think I am right in saying we have only one member or deliverer aged under 40 (out of about 50 or so), and we have a number of who continue to deliver well into their 70s and 80s (until physically prevented by blindness in one case). If it was left to the 20-40s, we’d be able to deliver perhaps 2% of the ward.

    That is why I am concerned that the enthusiasm for these proposals seems to come predominantly from a section of the party that represents only a small proportion of the membership.

  • Speaking as someone rapidly approaching 40 with two young children and a working apouse, I barely have time to deliver leaflets letalone become a councillor.

  • Anonymous,

    I will declare my hand at the start. I am a rarity in that I am not only a young councillor (25) but I am also leader of my six strong council group on Merthyr Tydfil council and member of our cross party executive board.

    Yes, as a local councillor involved in the administration I would love to have more money to spend. But I want that money to spend on highways, street cleaners, schools and other key public services that affect people’s daily lives.

    As a party, we are committed to providing local authorities with the power and funding to deliver local services tailored to their local needs.

    The spending cuts announced here clearly relate to the things that don’t help us do that. Things like the old DTi (now BERR), ID cards, nuclear power stations and ludicrously overpriced defence projects like the eurofighter. None of these things help to improve peoples lives.

    I think scrapping these pointless schemes and using the money to directly improve the lives of low paid workers – of whom there are thousands in my borough – is politically expedient, economically sound and morally laudabe.

  • “I think scrapping these pointless schemes and using the money to directly improve the lives of low paid workers … is politically expedient, economically sound and morally laudabe.”

    But that’s not what is being proposed. The spending cuts are to fund tax cuts for “ordinary families”. This BBC report specifies “lower and average earners”:

  • Oranjepan, thanks for your remarks about sacking oldies who make “excuses”, and replacing them with young superstars who “cover the ground delivering leaflets”. While you celebrate the ineffable superiority of youth, perhaps you could just slow down your bright young things for a few minutes, and teach them a bit of history. Tell them what the nation thought about the ideological tax cutters, back in John Major’s day.

    Anonymous, I’m 58, and I do think the policy is 66% right. It’s right to reverse Labour’s spending excesses, and it’s right to try to help people in hard times. It’s wrong if we make tax cutting our rigid ideology, as the Tories used to do. And yes, age and experience teaches us about the pitfalls, I think!

  • Andrew Duffield 18th Jul '08 - 11:52pm

    The answer to Danny Finkelstein’s “too little, too late” critique (with which you Stephen, and I certainly, appear to have considerable empathy) is to go further and faster – really putting some clear water between us and the Tories, and leaving Labour drowning in the drink.

    I know if we knuckled down to it we could find enough to shave that extra penny off income tax, rounding the basic rate down to a much more comfortable 15p. For the sake of balance, not to mention its economically damaging effects, we could also reduce VAT to a similar level. It would be nice to go a lot further in flattening VAT, but EU rules is EU rules.

    We already have a commitment to take all minimum wage earners out of income tax. Now would be a good time to start fleshing that one out as well. Finally, I hope we can at last join the dots of economic logic and lay Local Income Tax to rest. We’ve had “Axe the Tax”. It’s time for “LIT – RIP”.

    As for paying for it, that’s mapped out as a “longer term” aim too – switching tax from work to wealth (the unearned kind). As the property market reaches the bottom in the next couple of years, there will never be a better time in a generation to start phasing in LVT.

    Couple that with a charge on credit creation by the banks (merely recovering the interest levied on the funds they create from nothing) and not only do we have the wherewithall (around £100bn in total) to fund some really progressive and genuinely redistributive policies for a change, but we also put the economic system on a more sustainable footing into the future.

    There must be a few more votes in that, surely? C’mon y’all – Further, Faster! Make it happen!

  • Being an old fogey myself, I find it intensely amusing how quick people are to take offense at mere descriptions by ascribing judgements to them.

    Jumping to conclusions is not what I call liberal, ideological or otherwise. So let’s not turn this into a condemn-a-thon and compete over who can get most outraged and hyperbolic, eh?

    To clarify: I don’t celebrate ‘ineffible superiority’, I only try to recognise the reality of a particular instance, and in doing so provided an example from personal experience.

  • Anonymous is right to be questioning, it is too easy to say cut spending by 3% or whatever and cost more money that you save. On the otherhand, Councillors will be very used to making the distinction between “cuts” and efficency savings, stopping doing things that no longer need to be done or that haven’t been worthwhile or doing things in a different way and getting better results.

    Working families tax credit is one example of something that could be cut while saving money and making poeple better off. £14 billion on the government own figures has been wasted on fraud and overpayments. Even when it works, people are taxed and then given the money back minus a share for the huge beaucracy involved. The actual harm done to families that have to replay thousands of pounds are awful, while at the other end of the system, people on £50,000 get a payment of £500, it’s madness.

    I don’t believe this is just a bright young thing issue, it is really a return to the Liberalism of Joe Grimond and David Penhaligon.

  • Mouse:
    “Working families tax credit is one example of something that could be cut while saving money and making poeple better off. £14 billion on the government own figures has been wasted on fraud and overpayments.”

    But if I understand correctly, that was over a 5-year period, and in 2006-7 the figure quoted is £1.54bn.

    People seem to be assuming very casually either that we’ll be able to be far more successful with efficiency savings than other parties have been, or that there are huge amounts to be saved by axing totally useless schemes.

    Take ID cards. The original estimate of the cost was £5bn. Other estimates have put it at more like £20bn. But that’s over a TEN YEAR period. The Eurofighter has been mentioned – another £20bn, but another one-off payment.

    To my mind this actually illustrates what a significant amount £20bn will be to find as an annual saving.

  • David Morton 19th Jul '08 - 10:14am

    Finklesteins argument is this. The new Lib Dem package loks like its being virgin cola to the Conservatives Coke. On that basis Labour voters may stay Labour and small c conservative ones may vote for the “Real Thing”. I’ll reserve overall judgement till I have seen the much needed extra detail about how this is gon to be paid for and who exactly is going to get the tax cuts. owever at this stage I thing a number of Amber lights should be flashing.

    1. In terms of media coverage ( and lets not exaggerate how much this has realy had). This is a “Man bites Dog ” story as a lower tax burden is counter intuitive move for the party. However lets ot assume that novelty will translate in to votes.

    2. I’m really very uneasy with “one off” savings like euro figter and ID cards being used as examples of how to pay for ongoing Income tax cuts. And so I expect will be political and economic Journalists nearer the election. £20bn is about 3% of government spending. When you take out untouchables like halh, educaion and law and order achieving it will require deeper than 3% cuts in other areas to make the figures work. Its easy and correct to idenify wasteful projects after the event. An all together different task is achieve dep cuts in revenue spending without commig up against popular and neccesery programmes. And its not as if the “Make it Happen” document doesn’t spray around extra spendin comitments its self.

    I will put my tin hat on and say much “spotty” blogosphere reaction to this would be more temporate if people had ever ben councilors and new how budgets work.

    3. Public spending as a ropotion of GDP is not particularly high compared to the post war period. A new comittment to lower overall spending as opposed to sharing the proceeds of growth is a radical departure and needs careful thought.

    4. Remember Keynes ? I don’t see how cutting Income Tax for people will be massively helpful if they have no employment income to tax. does this sort of move make sense in a recession ? what if we need a public works programme? or need a “war economy” model to deal with climate change. When I look at the global economic situation I think the yellow book might be more apropriate than the orange book.

    5. I’m concerned that at this early stage so many differnt people from different wings of the party feel able to project so much of what they want to see onto this.

    6. however much they tell you they want tax cuts (and they do) never forget voters addiction to public services. I will take the single example of adult social services where inflation is running at 5% to 8%.

    7. finally I have many faults but being a conservative isn’t one of them. I know look at David Cameron refusing to rule out tax increases because of quite legitimate concerns about the state of the public finances. Am I the only person who might thing this position makes more immeadiate sense ? you can say what you want in politics but it doesn’t matter if no one believes you.

    In conclusion they say that the worst budgets are the ones that lok best on the day. A 3% cut in public spending ( I will labour the point – this inevitably means deper cuts in some areas) is a big move and will need much discusson and thought over the next few months.

    happy to hear thoughts from confrence reps [email protected]

  • Anonymous – Sorry if i wasn’t clear, but I meant that cutting taxes for low earners would improve their lives. Having to pay less in tax not only would make them financially better off but would be less demoralising for them too.

    David/Anonymous – in one sense the Eurofighter and ID cards are one off projects, but in budgetary terms they aren’t. Take ID cards. You say they may cost £20bn over 10 years. Well that’s £2bn a year currently in government spending projections. Take it out and you’ve cut £2bn a year. After it’s finished you arguably can’t save that money any more because it isn’t being spent. But if it isn’t being spent then you don’t have to raise it – so its a saving.

    The only concern regarding ID cards is that our previous policy was to use the savings to fund more police. I’m not sure how that commitment will now be affected.

  • Anonymous – the BBC quote says that lower earners will get help from this policy. It doesn’t contradict the previous comment in the way you say it does.

    If you are the same as the other ‘Anonymous’ postings, you look like you are very keen on misquoting to make your case.

    That is a shame.

    There are good debates to be had. But not if you misquote and dismiss anyone who disagrees as too young or too stupid to understand what you are saying.

  • Steve

    What on earth are you talking about?

    Where have I “misquoted” anything?

  • What is shocking is that it should be seen as strange or counter-intuitive for a liberal party to be advocating lower taxes (especially, but not exclusively, on the low-paid).

    But it is quite understandable that the media and the public should have this reaction considering where we have until recently positioned ourselves on tax. New Labour has steadily ratcheted up the tax burden to high levels both historically* and internationally and yet we have continually promised yet more tax.

    Sensibly Vince Cable and the Treasury team have moved us away from this position through a commitment to revenue-neutrality in tax reform, which was a modest first step.

    If Nick is serious about reducing the overall tax burden – and it won’t be easy to achieve given the fiscal outlook over the next few years – then this is a very positive development for both our liberal credentials and political appeal.

    * Comparisons with the Thatcher government in the mid-1980s that don’t take account of the big structural transformation that was taking place then are pretty tendentious. It is clear that Brown has presided over the biggest intentional increase in the size of the state since the mid-1970s.

  • Alex

    I have no idea where these claims are coming from. The fact is that the level of public spending as a proportion of national income is virtually identical to what it was when Labour took power in 1997. That’s according to the Institute for Fiscal Studies:

    Do you not accept the IFS figures?

  • More recent IFS figures show the tax burden (tax receipts as a % GDP) has risen from 37.3% in 1996/97 to 40.1% in 2007/08, which is a substantial increase: http://www.ifs.org.uk/budgets/budget2007/public_finances.ppt#262,6,Mr Brown’s fiscal record.

    Moreover, in 1997 public spending as a share of GDP was on a downward path, and borrowing was still high (as a legacy of the ERM fiasco) but falling rapidly.

    For two years Brown followed sensible policies which meant these trends continued, so public spending as a % of GDP was lower in 1999 than 1997.

    Since then the taps have been turned on with precious little regard either for the effectiveness of the spending or the deterioration in the public finances that it would bring about (because although taxes have risen, they have not risen by as much as govt spending – hence why the budget has gone from a healthy surplus in 2000 to a big structural deficit).

    The problems began when Brown abandoned the policy of increasing spending more slowly than trend GDP growth and started outpacing GDP growth year after year.

  • Anon, this may well be true, but inequality studies show how distributions of collection are increasingly unfair.

    You are making the case for revenue neutral shifts in the balance of collection, which is what the proposals amount to over the short-term We base the prinicples of taxation on ‘fairness’, while implying that policy success in the medium-term will enable overall levels of taxation to fall progressively as levels of social equality and prosperity rises.

    If you accept the links between inequality and poverty then this is the correct fiscal line to take.

  • Anonymous – I do not know if you are the same ‘Anonymous’ from all the different quotes. One or more people use that name on this site with very similar argument style. Misquoting is part. Another part is getting angry quickly if people disagree. Another part is dismissing people who disagree as stupid or too young.

    Examples of misquotes
    – Chirs Huhne, chopping off part of what said on 42 days so changing meaning,
    – BBC, whose quote said LibDem plans will help low paid but used to support argument that they won’t, my own and your own words,
    -switching around ‘possible’ with ‘likely’ and ‘probable’ as if they are all the same – I chose my own words, please don’t change them just to suit the point you want to make, thank you very much.

    Is that enough examples?

  • Alex – thank you for saving me having to look up to quote those exact figures myself. The huge growth in public spending should be measured from 1999 as that is when it started. If you only quote figures from 1997 to now it gives misleading picture of trend as there were two trends, down for a short while then up for a long while.

  • Steve
    You accuse me of “Chirs Huhne, chopping off part of what said on 42 days so changing meaning”

    In plain terms, that is a lie.

    Please post the details of what you claim I “chopped off”, and how it was supposed to change the meaning of what Huhne said. If you can’t do that, please withdraw what you said.

    Quite what you are trying to say about the BBC is beyond me. What I quoted is there in black and white for everyone to see: “lower and average earners”. My point was simple enough: the tax cuts would be drected at for low _and average_ earners – the majority of the population – not just “low paid workers” as the previous post suggested.

    And as for this utter nonsense about “possible” versus “improbable”, all that was going on there was you objecting to my pointing out that an election within months was improbable, on the basis that it was “possible”. I still haven’t worked out the logic behind that one, but there was certanly no question of me “misquoting” anything!

    You really need to look to the accuracy and logic of your own contributions, rather than making ill-founded accusations against other people.

  • Well there you go again – ‘all that was going on there was you objecting to my pointing out that an election within months was improbable, on the basis that it was “possible”.’ That isn’t what I said. As you seem incapable of debating without twisting people’s words and then accusing them of being stupid liars if they disagree with you, I can’t see the point of continuing. If you want to persuade people to agree with you then, once you’ve stopped being angry with me, you should perhaps give a thought to how you approach debating with others.

  • Alex

    Thanks for quoting those more recnt projections. So currently tax is nearly 3 points higher, and spending is 1 or 2 points higher (obviously there is an error in one of the slides) than when Labour took power.

    But it’s clearly quite wrong to say that “New Labour has steadily ratcheted up the tax burden”. There was an initial increase of about 3 points, then it dropped back to its original level, and then it increased again.

    You say spending was on a downward path when Labour took power. Indeed, and it continued to fall during Labour’s first term – it fell about 3 points before rising again.

    Clearly there are cyclical variations in taxation and spending, and these changes of 2-3 points up and down are obviously typical of what’s happened in previous cycles.

    And it is simply not true to say that public spending is historically high. Even on the revised figures the levels are similar to those under Major in the early 1990s, and lower than under Thatcher in the early 1980s. Yes, there may have been reasons for that, but of course there are reasons for the changes in the current cycle, too.

  • Steve

    “Well there you go again – ‘all that was going on there was you objecting to my pointing out that an election within months was improbable, on the basis that it was “possible”.’ That isn’t what I said.”

    On the contrary, it’s precisely what you said. Here it is in black and white:
    “16th July 2008 at 10:49 pm
    Labour gets hammered in elections. Brown quits or is ousted. New Labour leader remembers what happened to Brown last autumn. Snap general election called instead. Voting is all over by Christmas.
    Likely? No.
    Possible? Yes.”

    You really need to check your facts before coing out with accusations against people.

  • Your actual words which I was responding to were, “Does anyone on this planet really believe Gordon Brown will go to the country before 2010?”

    I was objecting to you painting anyone who thought an election could happen as being so barmy they are on another planet. It is a shame you again chopped someone’s words out of context to make your point.

    I think you have made my point that debating with you isn’t possible as you are not willing to listen to what other people are actually saying.

    End of contributions.

  • “Your actual words which I was responding to were, “Does anyone on this planet really believe Gordon Brown will go to the country before 2010?”

    Well, if you didn’t understand that as an expression of the extreme unlikelihood of Brown calling an election before 2010, I think you were the only one.

    But if your final sentence means we’re to be spared further nonsensical arguments of this kind, it can only be good news!

  • Alix:
    “Who is it you think is implicated in “low and average” who isn’t also implicated in “low paid”?”

    Average, obviously.

  • Hywel Morgan 20th Jul '08 - 1:41pm

    “no-one would suggest that a single parent keeping three children on £23k was vastly better off than a single childless person living on £14k.”

    The single parent would however get around an additional £5k in tax credits and child benefit which you’d need to factor into the equation.

    (Assuming they claim them – I’m not supporting the tax credits system – it seems a little pointless taking c.£5k in tax and NI just to give it back! But earnings don’t necessarily equate to income).

  • Alix

    If you’re giving tax cuts to people on average earnings, that is going to include the majority of the working population. Obviously that is entirely different from directing tax cuts only towards the low-paid.

  • David Morton 20th Jul '08 - 2:26pm

    I think the problem is people think Average means median when it doesn’t. Any tax cuts that included people on average wages would effect the bulk of the working population. While Alix is right that the BBC’s “average” families aren’t mentioned in the document its symptomatic of the lack of detail that they felt able/justified to use it.

  • David Morton 20th Jul '08 - 2:34pm


    what “variability” is there to average earnings? Its a precise mathmatical term. If you want to take personal circumstances into account then you’d need to go for a tax credit system. labour didn’t want to help everyone they wanted to help the working poor and people with children. hence the nightmarish comlexity and means testing.

    If we as liberals use the income tax system it will be easier , simplier, cheap but more scater gun.

    Anyway because the document only uses “struggling” and “ordinary” this entire discussion, my contributions included, is pointless because frankly we don’t know what it means.

  • All kinds of words have been put into my mouth, and all kinds of implications have been read into what I wrote.

    Can I just remind people what it was again?

    Kevin wrote:
    “I think scrapping these pointless schemes and using the money to directly improve the lives of low paid workers … is politically expedient, economically sound and morally laudabe.”

    And I responded:
    “But that’s not what is being proposed. The spending cuts are to fund tax cuts for “ordinary families”. This BBC report specifies “lower and average earners””

    If the BBC report is accurate, then clearly the policy is not as Kevin described.

    “Lower and average earners” is clearly quite different from “low paid” workers. To argue with that on the basis that it’s difficult to know where to draw the line is like saying green is the same as blue, because it’s difficult to know exactly what wavelength divides them.

    If the BBC report is an invention or an error, then we’re left with “ordinary families”, not “the low paid”. I’d suggest that if the authors of the document wanted to convey “the low paid”, then “ordinary families” was a very strange choice of words.

    But perhaps it’s just one of those phrases that can mean all things to all men.

  • “I think the problem is people think Average means median when it doesn’t. Any tax cuts that included people on average wages would effect the bulk of the working population.”

    Of course, to a statistician “average” can mean either mean or median (or even mode). But whatever sense it’s used in, with reference to the distribution of wages, “average and low” is going to include at least half the working population.

  • David Morton 20th Jul '08 - 6:21pm

    Well to try and salvage some compromise from this and move the debate forward I agre about one thing.

    the absolute priority of basic rate personal allowances being raised rather than marginal rates. While £500 is identical to a cleaner on £14k and a banker on £114k proportionately one is greater than the other and will definately be noticed more by one than the other.

    I think (please correct me) mnimum wage is £5.56 Ph. Multiplied by a 37 our week and 52 weeks thats £ 10697.44 pa salary.

    If we are really serious about using tax cuts for a fairer society then setting that as the basic allowance would be a “direction of travel” would be the best start. Off the top of my head I don’t know how much that would cost or how far our £20bn would go but it would be a big start.

    Conference amendment any one ?

  • There’s an interesting commentary here on the possibility of Labour funding tax cuts for the low-paid by raising taxes on the rich – the options include a couple of variants of a 50% tax band, funnily enough:

    It would be an odd situation if Labour and the Lib Dems were advocating tax cuts, while the Conservatives were hinting at the possibility of tax rises, as Cameron has been today.

  • “Well to try and salvage some compromise from this and move the debate forward I agre about one thing.

    the absolute priority of basic rate personal allowances being raised rather than marginal rates. While £500 is identical to a cleaner on £14k and a banker on £114k proportionately one is greater than the other and will definately be noticed more by one than the other.”

    It comes down to the same question. Are tax cuts to be directed to the poor, or to most of the population?

    I think if the party conference is to make any sensible decision about these proposals, it needs to know – in general terms – how the tax cuts are going to be distributed among different income groups.

    And it also needs to know – in general terms – where the spending cuts are going to come from, what impact there will be on public services, and how that impact will be distributed between different income groups.

  • David Allen 21st Jul '08 - 6:23pm

    Today, Bruce Richards in the Independent describes the Tories as “serious men for serious times”, while the Guardian points out that “Mr Clegg …. must now show voters why, given his diagnosis, he does not think the cure is to be found in a Conservative government.”

    Meanwhile, we cheerfully announce that savings of £20bn can be plucked out of the air, and that it’s OK to work out later on where it is all going to come from. Does this make us look like serious people for serious times?

    I accept that we were absolutely right to put an ocean of clear water between us and Labour. Now let’s have the sense to row back on the flaky overclaims and overcommitments, before we make ourselves look ridiculous.

    Yes, we should regularly make a fuss when we see Labour wasting money. Today’s story that Labour wants to rebuild every secondary school in the country on the cheap by 2020 is another example. Let’s build fewer schools, and (unlike CLASP schools) build them to last.

    But let’s be honest. We will need savings, first and foremost, to make room for massive investment (whether public or private) in low-energy transport and housing infrastructure. We may have to choose between tax cuts and effective action on climate change. We know which has to come first. Don’t we?

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