PMQs: Nick tackles Gordon on “big, permanent and fair” tax cuts

Today’s PMQs underlined to me how utterly hollow and rotten the institution really is. It’s not just that it couldn’t be more archaic if the protagonists were daubed with woad. It’s how it makes them behave. The aspect being chiefly reported is a horrifically self-important tussle between Cameron and Brown over a dead baby.

In case you are lucky enough not to know about this yet, Baby P was killed recently in North London after months of abuse during which time he had been the subject of supervision from various health and child protection agencies, all of whom failed to detect the risk to his wellbeing. This comes eight years after the similar and infamous Victoria Climbie abuse case – also in Haringey.

It’s the sheer stupidity of today’s exchange, as well as its unedifying nature, that bothers me. Read the text and it is perfectly clear what the two men are actually saying to each other. Cameron’s basic contention is that there should be an independent public enquiry (although he gradually widened this to include central interference in the local authority responsible) and Brown’s basic contention is that the system in place consists of an internal enquiry, whose outcome will now be assessed independently by the Minister. Cameron replies, repeatedly, that the system shouldn’t work like that. Brown replies, repeatedly, that it does. Brown’s flakey failure to respond to the suggestion of independence and exceptional action was depressing, and Cameron’s righteousness in playing on the circumstances of the case to press that suggestion home was just repulsive. If the latter’s podium-thumping was as unscripted, genuine and apolitical as he tried to make it appear then why did he have a page of factoids on Haringey Council to hand? And why did he allude even obliquely to the fact that Haringey is Labour-run? “I’ll come to the economy in a moment”, my fundament. He never intended to ask about anything else.

Clegg meanwhile used his questions to push our tax policy, still (incredibly, even after the Tory policy team has stayed up late several nights in a row) the only comprehensive tax cutting package on offer from among the three political parties.

Mr. Nick Clegg (Sheffield, Hallam) (LD): Week after week, I have called on the Prime Minister to cut taxes to give help to people on low and middle incomes, and he is now raising expectations that he will do just that, but why should anyone believe him? This is the Prime Minister who will not take responsibility for people losing their jobs, but did take credit for a bank rescue plan that he copied. This is the man who doubled the tax rate for 5 million of the poorest people in the country, and called it a tax cut. When it comes to taxes, he may pretend that he is Robin Hood, but he is no more than a petty pick-pocket. People do not need more cynical tinkering. What people need are tax cuts that are big, permanent and fair.

The Prime Minister: If we had listened to the Liberal party’s advice, we would be cutting public expenditure by £20 billion this year. That is not the policy that I believe it is right to follow. I hope that, on reflection, the right hon. Gentleman will support not only the recapitalisation of the banks, but the fiscal and monetary stimulus that ought to be co-ordinated worldwide, and ought not to be happening just in one single country. It is the ability of countries to work together and to co-ordinate that work worldwide that I think will be important to recovery in every country.

Mr. Clegg: The Prime Minister can misrepresent me all he likes, but he needs to get on and represent the millions of British families who are suffering under his unfair tax system. Right now, millionaires pay less than half the tax that they should on their capital gains. Top earners get an £8 billion tax bonus on their pensions. Up to £40 billion is lost in tax avoidance every year. When will he put an end to these tax breaks, and give ordinary people big tax cuts that are simple, immediate, permanent and fair?

The Prime Minister: First, we have raised capital gains tax from 10 per cent. to 18 per cent. Secondly, we have closed tax loopholes and continue to do so in every Budget. Where they are found, we take action when it is necessary. Thirdly, I come back to the point: what sort of stimulus to the economy would it be to cut £20 billion of public spending at the moment?

Same old non-answers. Read my note last week on the inaccuracy of the Capital Gains Tax claim.

Watch the session (if you can bear it) here.

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27 Comments

  • David Allen 12th Nov '08 - 7:12pm

    “Mr. Clegg: The Prime Minister can misrepresent me all he likes…”

    Well done Nick – that’s a lot better than last week.

    “Thirdly, I come back to the point: what sort of stimulus to the economy would it be to cut £20 billion of public spending at the moment?”

    Gordon hangs the millstone around our necks once again. Of course he is just trying to make trouble, and, of course he is wilfully ignoring Nick’s charge of misrepresentation. All the same, it was not Gordon who invented the £20bn figure in the first place. It’s time we found a way to stop him using it against us.

    How about a question about all the new jobs we could create in the course of cutting out waste and redirecting Govt spending towards better priorities?

  • “Today’s PMQs underlined to me how utterly hollow and rotten the institution really is.”

    ‘fraid I can’t agree completely – I think it showed how just hollow and rotten Brown’s Labour agenda and Cameron Conservative agenda are.

    The function of this institution depends entirely on the behaviour of those in it – it failed today because both Brown and Cameron failed. This shouldn’t be a surprise to us as they have consistently failed and can be expected to continue to fail.

    I think Ed Balls should resign over the Baby P affair.

  • Hywel Morgan 12th Nov '08 - 10:29pm

    “I am suggesting that he was far too well-briefed in his subsequent questions”

    I see nothing in Cameron’s subsequent questions supporting that:

    There is some material in his third question – though that pretty much 101 information to have at your fingertips when asking questions about that particular authority. Questions 4 is a direct response and 5-6 are pretty much repeats of each other.

    That said I don’t see why Cameron lost the plot (which watching it he did appear to). Brown says he regretted making a party political point – not that he was accusing Cameron of playing party politics.

  • Clegg's Candid Friend 12th Nov '08 - 11:52pm

    “Brown says he regretted making a party political point – not that he was accusing Cameron of playing party politics.”

    Obviously Brown was trying to say he regretted Cameron making a party political issue of it, not that he regretted having done so himself.

    Equally obviously, Cameron was trying to make a party political issue of it. Why else does the Leader of the Opposition raise an issue at Prime Minister’s Questions?

    Brown committed a tactical error in saying that. Cameron came out with a bit of bogus outrage to capitalise on that error. Not an edifying spectacle. At least Clegg stayed out of it.

  • Clegg's Candid Friend 13th Nov '08 - 12:32am

    “Incidentally, why shouldn’t this case be a matter of party politics?”

    Frankly, I think there are some things that shouldn’t be viewed as an opportunity for party advantage, and I think this is one of them.

    And that includes everything, from straightforward attempts to make political capital out of it, through accusations that one’s oponents are trying to make political capital out of it, to simulated outrage that anyone could suggest such a thing.

  • Different Duncan 13th Nov '08 - 1:29am

    Brown doesn’t answer questions at PMQs. Cameron is well aware of this – he points it out every week. Why he got so angry over something highly predictable seems rather dubious to me.

  • Mark Senior 13th Nov '08 - 2:01am

    These tax cuts are not right.

    I am not sure whether i will renew my membership at the moment. The tax cuts seem too much like Tory ones to me and people who are out of work deserve it. Besides the media say this is going to be a service industry recession that hits the tories.

    Gordon Brown is the man with vision, even if he has to hide behind dead babies to make political points.

    The recession will be shallow and short lived, even better we have the prospect of deflation!

  • Different Duncan 13th Nov '08 - 1:13pm

    Mark, when have the Tories ever targeted tax cuts at the low paid? Even now, the supposedly more moderate and ‘liberal’ Conservatives are targeting their tax cuts at the better off.

    Inheritance tax cuts clearly only benefit the rich.

    Marriage tax breaks have nothing to do with a person’s ability to pay (indeed there is negative correlation between income and divorce rates).

    Stamp duty breaks do nothing for the poorest in society who can’t afford to buy property.

    Corporation tax cuts, while hopefully avoiding redundancies, any direct benefit will be received by the rich.

  • Clegg's Candid Friend 13th Nov '08 - 1:37pm

    “Mark, when have the Tories ever targeted tax cuts at the low paid?”

    That would be a valid point if the Lib Dem tax cuts were targeted at the “low paid”, but of course they’re not. They are cuts in income tax, from which the higher-paid will benefit more in cash per head than the lower-paid. The “vast bulk” of the tax cuts (to coin a phrase) would go to the middle class.

  • Hywel Morgan 13th Nov '08 - 1:43pm

    “Mark, when have the Tories ever targeted tax cuts at the low paid?”

    Being pedantic the introduction of the 20p rate in 1992 (and it’s gradual widening in the following years).

    “even better we have the prospect of deflation!”

    Deflation with high levels of personal debti is not a good prospect.

  • Mark Senior,
    any tax cuts we are proposing are the diametric opposite of anything the Tories suggest, so this is no reason to protest at the party line.

  • David Allen 13th Nov '08 - 6:18pm

    Mark Senior,

    Oranjepan and others are quite right to say that our proposals are very different from the Tories. However, I do share your fears. I certainly don’t want the Lib Dems to turn into a right-wing party which tries to roll back the State the way Thatcher did, and bribe voters with tax cuts.

    I am now cautiously hoping, though, that the fears are unwarranted. Nick Clegg has spelt out the plans more thoroughly this week, and what that has shown is a good deal of continuity with the original “tax switch” plans that Ming Campbell adopted over a year ago. That is, the cuts will be funded by increases e.g. in green taxes.

    CCF is therefore, I think, being a little unfair. Yes, the bulk of the income tax cuts would go to the middle class: but, the bulk of the corresponding increase in green taxes, etc, would also be paid by the middle class.

    OK, we certainly are not calling for even higher taxes overall than what Gordon Brown is now imposing. But would you want that?

    (PS, mind you, a little imp is telling me that after the next election, whoever wins, higher taxes is what we are going to get, anyway! However, that’s reality, and this is politics. If we so much as hinted that we understood what reality was, the Tory Press would no doubt happily distort everything we said out of all proportion….!)

  • Clegg's Candid Friend 13th Nov '08 - 6:43pm

    “CCF is therefore, I think, being a little unfair.”

    In what way? It’s simply not true to suggest that these tax cuts would be targeted at the low-paid. That’s the point I was making.

    This point is going to become rather more important if – as the media seem to expect – the government introduces some tax cuts of its own, funded by additional borrowing, that really are targeted at the low-paid, through tax credits.

    Considering the rhetoric Clegg has been using, that would be awkward to respond to. If those cuts are more beneficial to the low-paid than the 4p cut Clegg is proposing, then will he oppose them?

  • CCF,
    what you’ve said misses the point.

    The balance of our proposed tax changes will benefit the low-paid. On balance middle-income earners will have the distribution of their taxes shifted and pay about the same.

    It looks again as though you’re only looking at half of our proposed package and not the full deal.

  • David Allen 13th Nov '08 - 7:10pm

    CCF – Well, I suppose that if you want the Lib Dems to lead the fight against the drift toward greater social inequality, which both the Tories and New Labour have allowed to happen (or indeed, quietly supported), then yes, you won’t be content with the present position.

    I do have some sympathy with that. I suppose I am setting my sights lower. If my party is going to renounce its Thatcherite fringe, and put forward policies that are at least mildly progressive, then I think I can at any rate stay on board. (It’s called looking for a sensible compromise, I guess.)

    Provided, that is, the party also tackles the important problems, i.e. climate change, peak oil, and not allowing Muslim-Christian conflict to turn into World War 3!

  • Clegg's Candid Friend 13th Nov '08 - 7:53pm

    “Well, I suppose that if you want the Lib Dems to lead the fight against the drift toward greater social inequality, which both the Tories and New Labour have allowed to happen (or indeed, quietly supported), then yes, you won’t be content with the present position.”

    Well, I’m obviously not content with it, but that’s a different argument.

    The point I was making was a simple matter of fact – the tax cuts being proposed would not be targeted at the low-paid as was suggested above, but at people on low and middle incomes.

    Why Oranjepan thinks differently is beyond me. He must have heard Nick Clegg say that often enough, and he must know that most of the funding for the 4p cut would come from tax increases for the wealthy, not those on middle incomes.

  • Clegg's Candid Friend 14th Nov '08 - 12:52am

    Andy Hinton

    This is where it starts to get very tedious.

    I’ve already explained three times that I was making a simple factual correction in response to the earlier suggestion that the tax cuts would be targeted at the low-paid.

    Is that really so hard to understand?

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