It would appear that Liberal Democrat policy has changed to one of cutting public expenditure to fund tax cuts rather than switching wasteful or less desirable New Labour expenditure to fund needed investment in accord with Liberal Democrat policies. This has been announced at various press conferences and interviews since the 17th July – but has neither been discussed by the Parliamentary Party or passed by Conference.
Given that – as the Times, Independent, Telegraph and Financial Times have all pointed out – this is a major shift in our policy, it is strange that it is not even mentioned in Monday’s motion on ‘Make it Happen’. Instead the assiduous Conference Delegate has to spot 20 innocuous words, buried among 4,000 in that document, in order to realise what they would otherwise be inadvertently nodding through on Monday afternoon.
Two reasons have been advanced to the press and in speeches as to why this massive shift is taking place – a shift which is all the more extraordinary given that the economy is hovering on the brink of recession and tax receipts falling, which already leaves any imminent Government facing either expenditure cuts, tax rises or increased borrowing. Even the Conservatives until now have said that they would need some years in office before they could envisage tax cuts which would otherwise be based on damaging public service cuts.
First we are told that taxation levels in the UK are now excessive and so cuts are more important than otherwise desirable public investment. This year’s taxation level of 36.8% of GDP in fact puts us at the Western Europe average and at 15th position out of 30 among OECD countries. For 22 out of the last 30 years UK taxation has been in the range of 35-38.7% of GDP and for 16 years in the 36-38.7% range. For eight of the last 30 years the UK tax take has been higher than this year’s level. Seven of those record levels were under the Conservatives who were unfortunately using the money to fund the mass unemployment they had caused, rather than on much needed public investment in health, education or transport.
So in fact this year’s ‘excessive’ levels of taxation have pushed us up only to the middle of OECD and Western European levels and firmly in the mainstream range of UK levels over the last 30 years. Of course we do have higher levels than the USA but the USA has appalling provision of welfare and health unless you are personally wealthy and can buy your own. Not a model that I – or I thought the Liberal Democrats – ever wanted to emulate.
Secondly, we are told that ‘all the extra money’ spent by Labour has been wasted with no visible improvement in health or education. This of course is palpable nonsense. New Labour have certainly wasted money on failed IT systems, over expensive medical contracts and the destructive impact of centralised control, target setting and inspection regimes. Clearly, though, there HAS been improvement in state health and education provision as a result of increased investment as anyone who is a regular user of such services can testify. I taught in state schools from 1979 to 2001 and my children have passed through the state system between 1988 to today – the improvements are undeniable. Can the critics really not remember the dire straits we were in by 1997, when Liberal Democrats, Labour, voters, and even most of the press were condemning the appalling levels of investment in public services and the marked appearance in Britain of JK Galbraith’s “private affluence and public squalor”?
I am not of course opposing our EXISTING policy of funding a basic rate tax cut to 16p (the lowest since 1916), via the Green Tax Switch, and closing off pension and tax loopholes that excessively favour high earners. That policy, along with replacing the regressive Council Tax with a progressive Local Income Tax, goes a long way towards ending the ridiculous situation whereby the poor pay a greater share of their income in tax than do the rich. Neither am I opposing our EXISTING policy of identifying £16 billion of Labour spending (such as ID Cards, Baby Bonds, third tranche of Euro-Fighter, etc) that we would switch into areas such as more police on the beat, scrapping tuition fees, or increasing education spending through the pupil premium
I am, however, fundamentally opposed to the proposed policy of making as yet unidentified spending cuts in order to fund as yet unspecified tax cuts. Especially when we are already being told that ‘we may have to abandon our opposition to Tuition Fees as we can’t afford it.’
We have among the worst primary class sizes in the developed world, and some of the highest secondary class sizes too; one of the lowest state pensions in Western Europe; fewer oncologists or radiographers and a worst cancer survival rate than most comparable European countries; among the worst funded childcare systems; fewer doctors per head of population than countries like Italy; we deny patients cancer and Alzheimer’s drugs available at public expense in better funded Western European systems.
I hope that Conference delegates will attend the Make it Happen debate on Monday afternoon and prevent this particular part of an otherwise excellent document becoming party policy. I for one would rather we funded the NHS adequately out of progressive taxation rather than supporting ‘top ups’ for the wealthy, and I have yet to meet a constituent who does not share that view.
* Paul Holmes is the Liberal Democrat MP for Chesterfield.
UPDATE:I and the other movers of the amendment (Evan Harris MP, Richard Grayson and Duncan Brack) agree with 99.9% of Make it Happen. We do not however support the twenty words that are a vague and open ended commitment to reducing overall public spending in favour of unspecified tax cuts. I have written about this in the conference edition of Liberal Democrat News and both Richard and I have both written about this in more detail in the latest edition of the Liberator.
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The first head above the parapet – might encourage those of us who’ve been thinking that the emperor is actually just doing a very grandiose streak.
“our EXISTING policy of identifying £16 billion of Labour spending (such as ID Cards,”
£10 billion is often talked about as the saving from scrapping ID cards. The BBC reports the revenue savings would be £300 million pa – which is pretty much peanuts in the context of the overall budget.
In total we identify nearly £4bn of cuts. The other two areas mentioned are NHS administration and the new nuclear programme. The nuclear savings may be a bit erroneous as we will need new capacity to replace them whatever
Will conference pass a policy which seems to involve a great deal of hope that it will actually all add up.
Conference is going to be unmissable next week. It’s not often you can say that!
Thanks for giving me a reason to feel bad about missing it Laurence.
Well I’m not going, but I shall be glued to BBC Parliament.
Paul –
you have said that ‘we’ are being ‘told’ that – and then you quote ‘we may have to abandon our opposition to Tuition Fees as we can’t afford it.’
Who is telling us that and when did they tell us?
I agree with this post.
Also, Laurence: if you’re watching on BBC Parliament, I shall be the one with the royal blue hair 😉
It’s alright Paul, I wasn’t selected for the new Shadow Cabinet either…
Mr Holmes doesn’t say which 20 or so words in Make It Happen he objects to, so I have to guess. Perhaps these are the ones:
“We’re looking for ways to cut Britain’s overall tax burden, so ordinary families have more of their money to help themselves.”
From the tone of his article, he may also be unhappy with the preceding sentence:
“If there’s money to spare, we won’t simply spend it.”
If so, he has completely misjudged the mood of the nation. Successive Conservative and Labour governments have lost the trust of the people, who are no longer willing to give politicians a blank cheque no matter how sincere their motivations or worthy their causes. Mere assurances that a Liberal Democrat government will not make the same mistakes are no longer enough.
Ha ha, that’s right, when they play the National Anthem, you’ll be the one standing up!
Well whatever else we do, we could actually say no to more police until we get the crimnal justice and prison systems working properly.
We could even go for a sensible policy on illegal drugs – or are we going to ignore the evidence that the current policy doesn’t work for evermore?
We could also decide to scrap trident properly and stop wasting money on weapons that we don’t need and which don’t work and properly equip the armed forces instead.
An important post. I fear that the Tory line of not committing themselves to cuts (because of the hole in which Labour will leave the next government) makes Clegg’s stated aims sound even more over-optimistic than they otherwise would. Big commitments on tax cuts will not help us to be taken seriously as stewards of the economy. We already have a formidable arsenal of policy to help ordinary people, with the 4p basic rate cut, green tax switch and LIT, as Paul points out.
In the last week or so, interviews with Clegg and others about the details of this package of further cuts have made it abundantly clear that the “i”s are not yet dotted on these cuts, nor the “t”s crossed. I’m not sure it would be such a terrible thing for conference to refer back this policy until it is made rather clearer that Clegg et al. know *exactly* where they want to find this money. If it turns out they can’t find the money, then we have saved ourselves an albatross around our necks at the next election. If it turns out they can, great: we’ll all know in that much more detail what it is we are voting for.
As Paul’s post makes clear, the current lack of clear detail makes it very easy to stoke fears that we would be “worse than the Tories”.
Thank God for this. i read Nick’s latest rubbish on the way home tonight and am seriously considering resigning from the party I joined almost exactly 35 years ago. i agree with every word Paul has written and this needs to be stopped. I am a Surrey County Councillor where it is dangerous to be old and need social care. We are discussing bus cuts when we shoudl be investing in public transport. We cannot afford to build the new schools the government is promising and people travelling by train in to London in the rush hour are treated in ways that would be illegal for animals. We need £200 million to bring our roads up to a safe level and if there is a serious flood in Surrey we have no defences.
If I wanted to be a Tory I would have joined them and perhaps those who want Tory policies should do that.
The next week will decide whether there will be a by-election in Surrey.
Does Paul mean investment when he uses the term “investment”? Is he talking about infrastructure? Or current expenditure used to run services?
Because “investment”, even when its not investment, sounds better than expenses.
“If so, he has completely misjudged the mood of the nation. Successive Conservative and Labour governments have lost the trust of the people, who are no longer willing to give politicians a blank cheque no matter how sincere their motivations or worthy their causes.”
If that’s true will a cut of 1-2p in the rate of income tax (or something equivalent) change that viewpoint.
The “mood of the nation” has never been much in favour of taxes, naturally.
And no doubt the more the nation is assured by cynical politicians that there are huge amounts of waste in the system (never identified, of course) and that it’s quite feasible to cut taxes, plug black holes, and satisfy all manner of new spending commitments – all perfectly painlessly – the more likely the nation is to feel that way.
We used to have a bit more honesty. We used to point out to people that good public services cost money. That approach got us quite a long way under the leadership of Ashdown and Kennedy. It remains to be seen where Clegg’s cynical salesmanship will get us.
We could always put something in the water to make people want to pay more tax. That’ll solve everything!
“We could always put something in the water to make people want to pay more tax. That’ll solve everything!”
As efficiency is the watchword, couldn’t we just put something into Clegg’s water. The question is, what?
Conservative and Labour policies are no longer decided at their party conferences – policies come from above ! Lib Dems, at least, can vote on policies and the direction the party is taking. Letus, from the ordinary delegate up, make the most of honest debate and decisions arrived at democratically
Yes, we need a new poll. What should we put in Clegg’s water?
– Ribena
– Alcohol
– Testosterone
– Cyanide
This site would be brilliant if I ran it . . .
I am a tax-cutter to my guts, but I do agree with Paul Holmes that a significant philosophical shift is being proposed by Nick Clegg. If this isn’t obvious in the ploicy document, it is certainly obvious in his interview to the Sunday Telegraph.
More power to Nick’s elbow, I say, but I’d like him to go even further down this road.
Mark, what would you recommend on inheritance tax?
Thank you, Paul, for being one of the few sane voices left amongst the Parliamentary party.
“If this isn’t obvious in the ploicy document, it is certainly obvious in his interview to the Sunday Telegraph.”
So at best you’d say Nick is being disingenuous towards conference.
The danger here is that conference endorses unspecified tax cuts – and when the actual cuts come along (which people don’t like) get told, “well you wanted tax cuts….”
It should also be noted that Danny Alexander has now contradicted the Telegraph story. So whether Mark should be quite so jubilant is open to question.
Either way Mark, surely as a communications professional you accept this has been cackhanded?
“This has been announced at various press conferences and interviews since the 17th July – but has neither been discussed by the Parliamentary Party or passed by Conference.”
How are we supposed to believe that Nick will hold regular (monthly) consultations on general party strategy with a group of around 1000 party memebers (as proposed by the Bones commission) when he doesn’t even consult with his Parliamentary party on announcements relating to tax proposals?
I wonder if Fidel Castro consulted a “Parliamentary party” before making decisions.
What should we put in Clegg’s water?
Bromide?
Seriously, the 20 words Paul Griffiths identifies are not very concrete, but Holmes has an important point about the way the party is headed. Personally I don’t like it, and will not work for such a manifesto. Even for Green measures, I would rather take a few percent off regressive VAT rather than progressive Income Tax, but that would take a lot of doing at continental level, since Europe is to blame for high sales taxes. I’m 44 and can remember VAT at 8%, and basic rate Income tax at 33%. Now its gone too far in the other direction.
Once again Holmes takes aim at the leadership and shoots the entire party in the foot. Cheers.
Paul, the first sentence of your article is based on a bit of a misapprehension, although an understandable one given that our policy has been misinterpreted in a couple of media articles.
The £20 billion of savings (from wasteful and unnecessary government expenditure) we are committed to will go first and foremost to the party’s spending priorities like guaranteed care for the elderly and extra investment in the poorest children’s education. But what Make it Happen is saying is that, if there is money to spare after this, then we’ll channel it into extending our tax cuts for people on low and middle incomes, so further reducing the proportion of their income low earners pay in tax compared to the rich.
Make it Happen covers the full range of policy areas, which is why the tax proposals get only a relatively small amount of the paper and the motion. But Nick Clegg and others have made a real point of emphasising that this is a significant move for the party. Nobody has been trying to hide it or get it through conference without members noticing. To the contrary, it is the first thing Nick has mentioned in every interview about conference I’ve heard or read.
Come on George – it is really important people stop with the spin here.
Clegg is not saying that if there is money to spare it will go into tax cuts – he is saying there will be money to spare – “billions” to quote from his latest intervention, which is an entirely different proposition.
No one appears to be challenging the assertion made by Hywel Morgan and others that currently our spending commitments pretty much wipe out that hypothetical £20bn in savings. So what are we going to do? Find more than £20bn or ditch some of our commitments?
The problem is, while the principle of cutting tax is one thing, we are being asked to sign a blank cheque here and the terms – at least as far as media reports are concerned – are changing daily.
Even in your own statement you can’t seem to decide what our policy is. How will reducing tax on “middle incomes” help people on “low incomes” as you suggest?
James – on the mixed message point, I agree with you. I don’t think that getting a clear line across has been achieved, but nevertheless, I like what Nick seems to be saying. Or at least what he did say to the Sunday Telegraph. Further, faster and bolder, please – but a good direction of travel.
Laurence – On inheritance tax – like on most other taxes except “exteranlities” taxes – I’d liek to see it fall, but also I’d like to see it handled differently. I think the burden should fall on individual legacies rather on the total value of the estate. If I leave my £10m estate to one person, this may incur a major tax, but if I divide it equally amongts 1000 people – each receiving £10,000 each, there should be no tax at all. I’d also like to see the law changed so that a “significant other” who is not one’s spouse can inherit the lot without penalty, rather than the present “bias” towards marriage.
James Graham: “The problem is, while the principle of cutting tax is one thing, we are being asked to sign a blank cheque…”
First, I think you’re wrong. I think we’re being asked to sign up to the principle.
Second, the whole point of Mr Holmes’s article is that he rejects the principle anyway.
I didn’t say I agreed with Paul Holmes…
Actually, quite the opposite. Paul Holmes is merely confirming a narrative about this conference that Clegg and Davey have been pushing for months.
From their point of view he’s done them a massive favour and now allows them to present this as a debate between the reformers and the dinosaurs. If only that was the real issue.
Nick Clegg has been given headlines to the Tory press telling them that we are in effect prepared to cut taxes more than the Tories. But to his own party he has not offered a debate at all. The conference motion that supports Make it Happen does not mention taxes at all, despite the fact that this is virtually the only thing he has been taking about since it was published. That makes the motion difficult to amend, which was probably the intention.
A lot of the debate we have had here has been trying to work out exactly who said what, and what it really means.
It is very bazarre. Nick Clegg wanted this important policy shift to take place within our party without any debate.
Extrordinary.
And having not debated it, we are then supposed to defend this policy that we have never previously believed in on the doorstep.
I do expect there will be an amendment discussed at conference reversing this shift, and I hope it will be passed. Even if you agree with the content, I cannot see how anyone can agree with the way the party has been taken for granted on this.
All this after Bones recommended bringing the party establishment closer to the membership.
The thread title here is on public spending cuts. A bit disingenous then to talk about 36% taxation levels (which is true), when public spending is at 42% – higher even than immobile Germany.
Hi James, sorry if you feel anything in my post was spin. I was trying to be as clear as possible and to clear up some of the misunderstandings about what is being proposed.
Let’s try again from a slightly different direction.
At the last election the Treasury team identified a sum equivalent to 1% of total government spending (£5 billion per year at the time) which could be cut from low priority spending areas to spend on our priorities.
Now the Treasury team are confident they can find savings equivalent to 3% of government spending (£20 billion per year). They are already well on their way to doing this. The question then follows: What is the best way for a Liberal Democrat government to use this money?
Clearly there are a lot of proposals for additional government spending for which a strong case can be put. The pupil premium is a particularly strong example. Our care guarantee for the elderly and support for disadvantaged students I have also seen cited. And I’m sure we could think of others.
But what Nick and Vince are saying is that, when looking at how we use this money, we should look not only at our priorities for additional government spending in some areas but also at using some of the money to cut taxes for people on low and middle incomes.
This is a redistributionist proposal. There is nothing progressive about high taxes on people who are struggling to make ends meet – quite the opposite. When Labour doubled tax on the low paid (by scrapping the 10p rate) we kicked up merry hell, and quite rightly. By the same token, tax cuts can be progressive – provided they are bottom up, not top down. If we can find sensible and affordable ways to cut taxes for these people (at a time when they are being hit by a double whammy of soaring prices and relatively stagnant wages) surely that is a good thing?
Make it Happen proposes that both (a) spending more in priority areas, and (b) tax cuts targeted at those on low and middle incomes should be in the frame for a share of the £20 billion.
That is not something that has changed daily, or at all, since Make it Happen was launched. Though it is unfortunate that some of the press coverage has misinterpreted the policy.
Also in response to your 12.39pm post James, you referred to our ‘spending commitments’. I’m not sure what you are defining these as. Do you mean the spending implications of every policy supported by the party? Our last general election manifesto?
Finally, you asked ‘How will reducing tax on “middle incomes” help people on “low incomes” as you suggest?’ I didn’t say that. I said that cutting tax for people on low and middle incomes would help low earners. It would also help middle earners of course.
“That is not something that has changed daily, or at all, since Make it Happen was launched. Though it is unfortunate that some of the press coverage has misinterpreted the policy.”
I think what you must mean is that it’s unfortunate that the party leader has misinterpreted the policy.
Unless you’re claiming that the Sunday Telegraph made up those quotations from Nick Clegg about the “vast bulk” of the savings going into tax cuts.
The line on tax has been moving frantically forwards and backwards, but mainly forwards, over the past month. Every time someone like Danny Alexander or George Crozier thinks they can provide a nice plausible-looking summary, the leader goes and shifts the goalposts again.
A month ago we had no definite promises of any tax cuts, just a Blair-like aspiration that we would try to spare some money if possible. It’s wonderful how things change!
It started as being for “the poorest”, then it became for “middle earners”. A few days ago I posted “Any advance on middle”? And my prayers have been answered. Yesterday’s formulation was “all but the very richest”!
This is from yesterday’s Standard
Clegg: Cut taxes and slash back spending to ease recession pain
“Liberal Democrat leader Nick Clegg today called for deep tax cuts for millions of Britons as he warned that the voters expected the Government to tighten its own belt in the “looming recession”.
In an interview with the Evening Standard, Mr Clegg detailed plans to slash £20 billion from public spending and urged ministers to “give back” a large chunk of the savings to nine out of 10 people.”
The rest of the article is here
http://www.thisislondon.co.uk/standard/article-23554087-details/Clegg%3A+Cut+taxes+and+slash+back+spending+to+ease+recession+pain/article.do
Ironically on Nicks million door challenge it says “The best way to engage with people is to go and talk to them.” How about talking to us Nick. I for one will not be knocking on any doors if this party policy, even though I am up for re-election next year.
But wait!
“… in an separate interview, party president Simon Hughes admitted there had been some “confusion” about its intentions on tax.”
Surely not! But just to make sure:
“He stressed that tax cuts for middle income earners were an option the party wanted to consider and not a pledge.”
http://news.bbc.co.uk/1/hi/uk_politics/7612706.stm
I wonder if our front benchers have ever considered going into pantomime. [Enter Prince Charming, stage right. “Oh no, they’re not!!”]
If it means more people vote for us and we win more seats, I’m not particularly bothered how outsiders interpret anything we or our leader have to say.
When we get an opportunity to show that we are correct the public continues to support us irrespective of what was said previously – from what I’ve seen we have a very good habit of proving detractors wrong.
Oranjepan, you completely lost me there.
But wait!
“… in an separate interview, party president Simon Hughes admitted there had been some “confusion” about its intentions on tax.”
Surely not! But just to make sure:
“He stressed that tax cuts for middle income earners were an option the party wanted to consider and not a pledge.”
[BBC]
I wonder if our front benchers have ever considered going into pantomime. [Enter Prince Charming, stage right. “Oh no, they’re not!!”]
Today’s Independent called it “…a major rebranding of the third party, from one wedded to tax rises to fund public services to one seeking savings to fund “big” tax cuts…”
Now, how is this going to be interpreted by the average voter?
How about “they’re a bunch of unprincipled shysters who will do anything to get your votes”?
To think that we used to have a deserved reputation for honesty and straight dealing!
The average voter doesn’t read the Indie.
Phew, we’re saved then, Julian! For a day or two, anyway….
David Allen / Clegg’s Candid Friend,
I think some of the confusion comes from the fact that we already have policy (adopted a year ago) which would cut taxes for people on low and middle incomes. This is our ‘green tax switch’, cutting the basic rate of income tax by 4p, paid for by upping taxes on pollution and closing tax loopholes used by the rich.
This is a tax cut we ARE promising people, and which would make the vast majority of people on low and middle incomes net gainers.
But we are not at this stage guaranteeing a cut in the overall tax burden. We would like to do it, and we are looking for ways to do it. But we won’t know for certain if we will be able to do it until closer to the election.
To respond to the idea that it is inconsistent to want an increase in government spending (and taxes) but a few years later to support (potentially) a decrease. If government spending had stayed the same you might have a point. But it hasn’t. It has gone up hugely – from around £400 billion in 2001 to around £600 billion today.
George,
The following is an excerpt from the Sunday Telegraph piece.
Mr Clegg has announced that he will cut £20 billion from public spending, which will be ploughed into tax cuts for middle earners. “We are now in a process of identifying what I believe will be the most radical package of tax- cutting measures for people on middle incomes,” he said.
Sun Telegraph:
“We will bear down on the ballooning government budgets. Vince Cable and I have been working over the summer identifying about £20 billion that should be reallocated and the vast bulk of it given back through tax cuts.
“We have taken some difficult decisions already to provide tax relief and we are doing some ongoing work… to help the vast majority of taxpayers. There are a number of options we are looking at. We have our pledge to cut the basic rate of income tax by 4p but as we do the sums, as we identify where we are going to get the money from we can become very much more creative between now and the next general election.”
Asked whether he meant that he would go further than the 4p cut he said: “Yes.”
Ends
How is this not a commitment to cut the overall tax burden?
The Telegraph on the “rebellion against Clegg”:
http://www.telegraph.co.uk/news/newstopics/politics/liberaldemocrats/2824010/Nick-Clegg-faces-conference-tax-rebellion-by-Liberal-Democrat-MPs.html
Surprise surprise!
Nick Clegg has been interviewed by the Times, and guess what he says.
“His plan, which will horrify the Lib Dems’ corduroy jacket brigade, is to cut £20 billion from public spending and hand most of it back in tax cuts. … “The vast bulk of any money will be handed back in tax cuts,” he tells us.”
http://www.timesonline.co.uk/tol/news/politics/article4743751.ece
Are we still a radical party? If we are then we should be looking at what we need to do to achieve our vision of a liberal society – one in which no one shall be enslaved by poverty, ignorance or conformity if I recall correctly. Dealing with poverty and ignorance effectively is unlikely to be possible, I would have thought, by reducing the state’s resources for tackling those problems. I am sure that we would not have spent the money raised by higher taxation in the same way that New Labour did, and I hope that we would have been so much more effective in the ways that we spent it that there would not have been the current perception that the money has been wasted. But simply trying to carve out a distinctive position for ourselves with regard to taxation seems pointless when even the most ignorant elector knows we are not going to be in government after the next election. It is our vision for the future that we should be conveying because that has the potential to enthuse: getting into a dutch auction with the Tories on tax doesn’t.
George Crozier: Of course it isn’t inconsistent to adapt to changing circumstances by changing tax policy. I myself agree that the “penny on income tax” is yesterday’s policy for yesterday’s (post-Major) conditions, and we should now clearly move away from it. But that is very different from the seismic shift to the right that Clegg is now signalling.
Oranjepan: “If it means more people vote for us and we win more seats, I’m not particularly bothered how outsiders interpret anything we or our leader have to say.” Well hey, you’ve really set me thinking! What about all those hordes of vicious racists out there, just looking for someone to vote for? Let’s pull out the dog-whistle, and see if we can get them on our side as well! Moral principles? They’re SO last century!
James Graham: Correct me if I’m wrong, but my impression is that your biggest concern is that all this is being done in a disorganised and unprofessional way. Well, I see the point. However, my greatest fear is that it is, in fact, being organised very carefully – and that we would all be shocked if we knew the ultimate destination that is being planned for us.
The cancer drug issue deepens my worries. If you want to get more power for the rich, then speaking up for dying cancer patients is, of course, pretty much unbeatable as a way of garnering sympathy. However, the NHS drug bill is huge. Let me quote a Tory, Andrew Lansley, whose sense of social justice seems to be way ahead of Clegg’s. Lansley said “If the NHS could simply exclude treatments and expect patients to pay up, the values of the NHS could be progressively undermined.” Given this dilemma, why has Clegg actively chosen to intervene in favour of a two-tier system, while signalling reduced NHS funding?
Where are we heading for? Palinland?
In response to tony hill:
I don’t know why “radical” seems to equate to high public spending.
I don’t think there’s just a perception that New Labour has wasted a lot of money, I think it’s a reality.
The argument that we shouldn’t carve out a distinctive position because everyone knows we won’t be in government is just bizarre. The fact that we are the 3rd party, with only an infintesimally small chance of winning the next election, makes carving out a distinctive identity more important, not less.
Of course I’m not arguing that radical means high public spending: I’m arguing that without it we can’t achieve what we are in business to do as a party, and that instead of looking to what our core objectives are we seem obsessed with triangulating a position that will make us different from the Tories and Labour
David, if people are confused about our moral principles let them be – it doesn’t mean we haven’t got any.
If racist hordes are willing to vote for us because they’ve seen the light it doesn’t make us racists and it won’t make us start pandering to extreme views – I think being open-minded enough to give such people the benefit of the doubt is the only way to give them the space to reform their views and improve their outlook. It’s called redemption.
I’m not worried that different journalists have selective hearing and present our party in different lights – it’s only natural. It is also only natural that many of our activists have different views on how all of this reflects on our party.
At this stage before a general election it is a good thing that there is some leeway for different interpretation of exactly how we would institute our ideas.
We will need some flexibility in our approach to have space for adjustment, especially if the economy worsens between now and then (as it is predicted to do so from the current outlook) and it is absolutely prudent to account for all contingencies – which is something Labour has given up trying to do.
However it is also true that we have done more than the Conservatives in providing a basic outline of what we would do and how we would go about doing it.
If it is possible to deliver all we need to on our core issues, for me, building schools, free university places, adequate social care for the elderly, good public transport etc and to cut taxes, then I will be attending church on Sunday for the first time in 30 years. This miracle is not going to happen. It is very clear that there is a well organised move at the top of the party to move us on to Tory ground and there are a lot of us out here who will not stand for it.
“I’m not worried that different journalists have selective hearing and present our party in different lights – it’s only natural.”
If you really think this is about journalists being selective, I think it’s worth posting an extract from Clegg’s Radio 4 interview last Sunday in which, under pressure from the interviewer, he accepted that there might not be any money from the £20bn left over from tax cuts.
Bear in mind that in two separate newspaper interviews – one published before that radio interview, and the other today – he is quoted (in quotation marks) as saying that the “vast bulk” of that money would go into tax cuts.
__________
Interviewer: You’ve also said, haven’t you, that you’ll be cutting 20 billion from public spending, so how much of that if any will go towards funding the 4p cut?
Clegg: Well, I’ve always said of course I can’t cross all the ts and dot all the is now nor should any [mumble] party can be in that position until we know the full state of affairs come the next general election. What I am saying is that if we can meet our spending priorities and we have money to spare I don’t think we should be looking around simply to find new ways of spending what is left. We should be providing further tax cuts to people on low and middle incomes. …
Interviewer: There is some confusion over this. At the briefing about your conference that I attended this week Ed Davey, your spokesman, said that the £20bn saved from the public sector would be reallocated to Lib Dem spending commitments with anything left over going in tax cuts and yet in the Sunday Telegraph today you say the vast bulk of the £20bn cut from public spending will be ploughed into tax cuts for middle earners. So which is it?
Clegg: I think it’s that the money will be used to meet the spending priorities we’ve identified by the general election, and the remainder will be used to cut taxes.
Interviewer: But you can’t do both, can you? [Interviewer (mis)quotes a comment on a blog] I can’t fathom why Ed Davey said something different to Clegg four days ago. That the first priority would be to divert savings to Lib Dem spending priorities and that the party can’t guarantee net tax cuts. Now –
Clegg [over interviewer]: Of course we can’t, of course we can’t.
Interviewer: – even your own activists don’t fully understand your policy.
Clegg: Well, I think we’re starting to split hairs, frankly.
Interviewer: Well we need to make it clear, don’t we? Because if your activists don’t understand then the voters certainly won’t.
Clegg: Well, dare I say it? The blogosphere can get itself quite excited about what are, to all intents and purposes, details. The position is actually quite simple. It’s as I just stated, but I’ll state it again, which is that the money which we are identifying through looking at areas of government expenditure we think is not being well spent or is being inefficiently spent [or doesn’t?] needs to be spent will in first instance be used to fulfil our spending priorities, but the money that is left over, if you like, will be handed back through tax cuts. Exactly what proportion that represents of that 20 billion I simply can’t tell you. I obviously can’t.
“Interviewer: But you can’t do both, can you?…”
correct response: Of course we can. It depends on the exact circumstances.
“Interviewer: – even your own activists don’t fully understand your policy.
Clegg: Well, I think we’re starting to split hairs, frankly.
Interviewer: Well we need to make it clear, don’t we? Because if your activists don’t understand then the voters certainly won’t.”
…like voters understand exactly everything each party stands for when they come to vote!
Clegg was perfectly correct in everything except the few words he used to disagree with the interviewer.
Which then gave the interviewer an opportunity to stop doing her job properly and try to grab a headline for her editor, which is exactly what has happened since. Not that I’m complaining though, because all publicity is good publicity etc etc.
“Clegg was perfectly correct in everything except the few words he used to disagree with the interviewer.
Which then gave the interviewer an opportunity to stop doing her job properly and try to grab a headline for her editor …”
Not for the first time, I have no idea what you’re talking about.
If it were really true that money would go to tax cuts after our spending priorities are fulfilled then it would obviously follow that we couldn’t guarantee tax cuts, just as Ed Davey had previously said.
And as I indicated, Nick Clegg actually interrupted the interviewer to say this. That’s not to say he was necessarily thinking about what he was saying, of course.
Anyway, there’s a bit more in the Guardian on the amendment tabled by Paul Holmes and others:
But Paul Holmes, MP for Chesterfield, and Evan Harris, MP for Oxford West and Abingdon, together with two former policy directors, Richard Grayson and Duncan Brack, have tabled an amendment asking the party to retreat on the tax cut promise.
Holmes said: “I am fundamentally opposed to the proposed policy of making as yet unidentified spending cuts in order to fund as yet unspecified tax cuts.
“Rather than cut taxes, there are other things that the public would like us to spend our savings on such as abolishing prescription charges or on Alzheimer’s drugs.”
CCF, you’re obviously feeling flushed after being quoted, but nothing here disargees with anything anyone we have said.
There are no ‘guarantees’ and nobody on our side has made any, so you’re criticism of the party is empty.
Our desire to make adjustments to differential tax rates means making cuts in some areas so that we can reprioritise spending in other areas. Once this has been successfully achieved the suffocating burden placed on citizens and companies who are struggling to make ends meet can be lifted.
It is as Clegg made very clear, very simple.
How large any reductions in tax are for the the sectors we feel are in greater need is entirely dependant on how the calculations balance themselves out once the final figures are in.
It doesn’t mean anything is impossible, just that ‘the devil is in the detail’, just as with everything else.
It is simply rash to expect to be able to place exact figures on our proposals at this stage, as circumstances will inevitably change. But neither does that mean our proposals are reckless.
In fact I think the indications we are showing are highly realistic and emminently sensible.
We do not face a choice between the conservative option of doing nothing while promising nothing or the Labour option of failing at everything while promising the world. We stand for making small promises and making gradual incremental changes which will fulfill our promises with the the view to improving the situation for everybody.
The fact is that Labour’s sums don’t add up and the Conservatives aren’t showing us any sums at this moment in time. All we are saying is that there are a variety of different factors, all of which must be taken into account before it is possible to get to grips with the budgeting for the nations finances.
We don’t need much in the way of additional artificial stimulus to get our economy working again, we only need to progressively liberate each sector in order to let everybody get on with our natural daily lives.
Oranjepan
You really don’t think there’s any contradiction between saying on the one hand (repeatedly) that the “vast bulk” of £20bn will fund tax cuts, and on the other that none of the £20bn at all may be available for tax cuts?
Sometimes I have great difficulty in believing you’re for real.
CCF, context is all, context is all.
Placing those selective quotes back in context reveals a subtext about our ongoing discussion on how exactly we need to balance competing aims and methodologies.
All differences can be resolved through reconciliation of oppositites, though we have as yet failed to find the precise phrasiology which satisfies each side of the equation.
In the meantime, why not help out by providing your suggestions instead of sitting there carping away.
I think TeamClegg could help themselves by alluding to metaphor more often – such as ‘we are entering choppy waters…’.
What’s your advice to the captain? ‘All hands to the pumps to stop the ship from capsizing’? ‘Let’s set ourselves on an even keel before we tack into the eye of the storm’?
Whatever you plump for you must accept it unsettles the crew to spread dissent among the ranks by starting an argument when we need to be getting on with our job of trimming the sails, plotting the course and keeping a firm grip on the rudder.
Goodness me! I leave you all alone for a fortnight and look what happens…
Help me out here, people. I gather from picking up various bits and pieces, that:
(a) the collective sum of press reportage has it that we have now pledged tax cuts beyond the reduction to 16p
(b) that this interpretation is actually not unreasonable given what Clegg has at certain points said and that therefore
(c) much depends on whether you choose to put emphasis on certain highlighted sentences (and there is a fair argument that if our messaging is right is simply shouldn’t be possible for the press to pick out sentences to misinterpret in this way)
Therefore it seems to me that we have three possible problems:
(a) Clegg is trying to get us to pledge actual tax cuts, with no qualifications, no by-your-leaves, and no “if we can afford its”
OR
(b) our press office and/or our message people are incompetent. Yes, the press are misinterpreting where they can, but that really shouldn’t be a surprise to us. The position remains that we’re pledged to 16p and pledged to further cuts *if we can afford it* – which was precisely and exactly what Clegg said in his speech at Liverpool and it passed without a murmur among the press.
Can I have a straw poll at this point? Who favours (a) and who (b)? Or have I omitted option (c)?
I think it is very clearly a. The spin on the BBC News 24 at the moment is that Nick is leading us away from tax and spend to tax cutting. Much as I would like to believe that reporter has got it wrong, we all know he has been briefed by our press officers.
Alix:
According to the article in the Sunday Telegraph:
Asked whether he meant that he would go further than the 4p cut he [Clegg] said: “Yes.”
Now I’m more bewildered than ever.
Some of the papers are reporting that £12bn of new taxes on the rich are now being proposed.
Can anyone “in the know” explain whether this is accurate and, if so, how it impinges on the debate about the £20bn of public spending cuts?
After looking more closely at the reports, it seems these are just the “tax the rich” component of the existing policy to cut income tax by 4p.
Presented by the Mirror thus:
“Lib Dem leader Nick Clegg will be scrambling to avoid an embarrassing defeat over his tax proposals today.
Mr Clegg was forced to rush out plans to hit the super-rich with £12billion taxes as rank and file members at the Bournemouth conference threatened to vote down an economic package.”
Surprising in a way, but I suppose the press can be forgiven some confusion, considering how much confusion the leadership is generating.
I see that elsewhere Simon Hughes is suggesting as a “ball-park figure” that £15bn of the £20bn planned (or rather not-yet-planned) public spending cuts could be reallocated, while £5bn could go to tax cuts.
What would that be worth? Another 1p or so off the basic rate of income tax?
Smoke and mirrors. Wise old uncle Vince, concentrating on all the issues like avoidance that he and everyone else can identify as fair game. A brief gesture backwards towards the party’s roots at the centre, just for a few hours while that vote is taken. Don’t worry, once we’ve got that out of the way, Nick can set his new course -Hard a’ starboard!
I agree that a commitment to a cut in the basic rate of income tax would be premature, but why is no consideration given to a reduction in the standard rate of VAT to the minimum of 15%? This would benefit not only the lower paid but also those who are not paid at all – the unemployed.
“I agree that a commitment to a cut in the basic rate of income tax would be premature, but why is no consideration given to a reduction in the standard rate of VAT to the minimum of 15%? This would benefit not only the lower paid but also those who are not paid at all – the unemployed.”
Because, to be blunt, for electoral reasons it is viewed as desirable that as much of the tax cuts as possible should be directed towards the middle class.
Of course it is being sold as a measure to benefit the poor, but obviously cutting the basic rate of income tax is just about the most inefficient way of doing that.
In other words, the new mantra is that it’s fine to redistribute wealth, provided we’re redistributing it towards, not away from, the middle class.