Tag Archives: IFS

IFS announces: peak pensioner and falling inequality

An article by Paul Johnson at the Institute for Fiscal Studies, and also published in the Times, begins

It can take a while before policy responds to new realities, in part because it can take time before those new realities are recognised. Policy has nothing like adapted to the collapse in home ownership among the young. We continue to treat pensioners as though they need free travel, winter fuel allowances and the like, despite the fact they are on average now the best-off demographic group in the country. The squeeze on middle earners that started in the early 2000s was barely noticed at the time.

This is so obviously and painfully true to any Liberal Democrat who may have dared to point out that income inequality fell during the coalition and is now (as Johnson points out) no higher than it was 30 years ago. The left wing grievance industry decided in 2010 that inequality was going to rise and has stuck to that line ever since, indifferent to the truth.

Posted in Op-eds | 39 Comments

82% back increase in taxes to fund NHS

Several NHS stories have caught my eye over the past week, and I wanted to bring them together into a blog that emphasises, yet again, that our NHS needs funding, and needs it soon. I have a heightened awareness now, having travelled the length and breadth of North Devon over recent weeks and seen the lack of provision in the communities there, with the nearest hospital for some being an hour away – and the nearest hospital for many non-urgent appointments being two hours away.

The NHS matters to all of us and needs sorting. We as Lib Dems are proposing a 1p rise in income tax to fund health and social care services. A poll announced yesterday in the Mirror shows that 82% of the population would back a 1p rise in National Insurance to fund the NHS. In answer to the question, “Would you be willing to change your vote in favour of a party who pledged additional NHS funding?” 18% of the respondents said ‘definitely’ and 33% said ‘probably’.

We set out our plan to put 1p on income tax in our 2017 manifesto. Our plan includes an eventual restructuring of National Insurance contributions with ring-fenced money for Health and Social Care. It is party policy that the NHS needs funding and taxes will have to be raised to do it. In the ComRes Mirror poll, almost an equal number of Tory (81%) and Labour (86%) voters agree.

This ComRes poll follows on the Institute for Fiscal Studies and Health Foundation joint report released two weeks ago showing that

Just to keep the NHS providing the level of service it does today will require us to increase spending by an average 3.3% a year for the next 15 years – with slightly bigger increases in the short run to address immediate funding problems.

Posted in Op-eds | Also tagged and | 10 Comments

Benefit Cuts Will Increase Child Poverty

A new report just released by the Institute for Fiscal Studies has found that benefit cuts will increase child poverty, especially in the North East and in Wales.

Absolute child poverty would increase by 4%, and three-quarters of that would be linked to the freeze to most working-age benefits and limiting of tax credits and universal credits to two children. Using forecasts from the Office for Budget Responsibility, combined with current benefit plans, the study shows child poverty will increase in each English region and nation of the UK.

Liberal Democrat Work and Pensions Spokesman, Stephen Lloyd MP, says

These figures from

Posted in News | Also tagged , and | 11 Comments

How should we share the gain and the pain in the next Parliament?

resolutionfoundationThat was the question the Resolution Foundation posed at a Lib Dem conference fringe meeting in Glasgow last week. Some of what follows was inspired by (ie, copied from) IFS Director Paul Johnson’s excellent LibDemVoice article, Balancing the books: some unpalatable choices, published last week. Some of it I’ve previously rehearsed in my ConservativeHome column, Make no mistake, these are deep and meaningful cuts – and there’s more to come. Anyway, here’s what I said…

“The gain and the pain.” I want to congratulate the Resolution Foundation on taking a glass half-full approach to the next five years. But I also want to challenge the premise of the question. Because – and I don’t want to be too depressing in what follows – I can see quite a lot of pain and I’m at a bit of a loss to see where the gain is likely to come from. Here’s why.

Posted in Op-eds | Also tagged and | 7 Comments

The Independent View: IFS Director Paul Johnson – Balancing the books: some unpalatable choices

Paul Johnson is Director of the Institute for Fiscal Studies. He will be speaking on ‘Balancing the books – tax and spending choices in the next Parliament’ alongside Ian Swales MP and Anne Fairpo of the Chartered Institute of Taxation, with BBC Scotland’s Business and Economy Editor Douglas Fraser in the chair, at 6.15pm on Tuesday at the SECC (Dochart 1). All conference attendees welcome.

We weren’t supposed to be here. When George Osborne delivered the Coalition’s first Budget in June 2010 the plans he set out suggested that the job of rebalancing the nation’s finances would be more or less …

Posted in The Independent View | Also tagged and | 13 Comments

Memo to both Left and Right: Income Tax isn’t the only tax that matters

There was some leftie love showered on this ConservativeHome article by Peter Franklin this week: Right-wingers should stop boasting about how much income tax the rich pay. His point was absolutely right, as he laid into the supposedly slam-dunk argument glibly tossed around by unthinking capitalist Tories like Boris:

The richest one per cent of Britons contribute 30 per cent of all the Income Tax collected in this country. This, supposedly, is a ‘killer fact’ – deployed with devastating complacency by the free-market right: Rising inequality? No need to worry about that! The rich are kindly paying your taxes for

Posted in News | Also tagged and | 27 Comments

Two-thirds of married couples EXCLUDED from Tories’ marriage tax allowance

Fresh from capitulating to his backbenchers over Europe, David Cameron is having to give in again on the issue of the marriage tax allowance. Evan Harris has already spoken out against the Tories’ plans here on LDV this week, highlighting how the policy harks back to the 1950s’ concept of nuclear households with (male) ‘breadwinners’ and (female) ‘stay-at-home’ spouses.

In the lead-up to the 2010 election, the IFS also looked hard at the policy, producing a devastating indictment of the policy’s flaws.

First, it sets out how it works: ‘up to £750 of the income tax personal allowance …

Posted in News | Also tagged and | 3 Comments

The 2013 spending review: the Lib Dem problem is at least as big as Labour’s

Piles of money. Photo credit: czbalazs - http://www.sxc.hu/photo/1236662Last Friday’s Independent splashed on the story, Exclusive: Labour bets the house with pledge to outspend Tories.

The story itself is disputed: Ed Balls rushed on the radio to rebut it: “Is it the policy of Ed Miliband and me Ed Balls that we will decide now to bet the house with a pledge to outspend the Tories? No, that is not our policy, that is not our position.” (Note to Ed Balls’ handlers: speaking of yourself in the third person is …

Posted in News | Also tagged , and | 16 Comments

How progressive is the new tuition fees system?

University campusThe Institute For Fiscal Studies (IFS) has been running its calculators and slide-rulers over the new system, and here are some of the key points that it has concluded:

  • “The new system eventually saves the taxpayer around £760 million per year, driven by a dramatic cut in direct public funding to universities.”
  • “But for universities, this cut is more than offset by almost £15,000 in additional fee income per graduate – a 140 per cent rise over the old system. Thus the total amount spent – from both private and public sources – on higher education is expected to increase as a result of these reforms.”
Posted in News | Also tagged , and | 38 Comments

Tuition fees: new IFS publication says new system “substantially more progressive”

News from the IFS confirms what others, including Money Saving Expert’s Martin Lewis and of course Nick Clegg, have previously argued:

The government’s decision to raise maximum tuition fees to £9,000 will create a system that is “substantially more progressive” than the previous system. That is because the 30% of graduates with the lowest lifetime earnings will be better off under the new arrangements.

And no cynical comments please about just how far down The Guardian’s story this paragraph was placed 🙂

 

P.S. As it’s the weekend and people may have other things to do, in order to save time I’ve …

Posted in News | Also tagged , and | 44 Comments

The IFS’s verdict on Labour’s deficit argument is in – and it ain’t pretty

Yesterday saw the publication by the Institute for Fiscal Studies of its annual ‘Green Budget‘, which looks generally at the global and UK economic picture as well providing a detailed analysis of the UK fiscal position. The document is fascinating in many respects, but one of the parts that particularly caught my eye was its devastating take on Labour’s position on the deficit.

Since the Autumn Statement, when figures for the estimated size of the budget deficit in future years were revised upwards, one of Labour’s main arguments has been that by cutting “too far, too fast” the government has …

Posted in Op-eds | Also tagged , , , and | 7 Comments
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