Tag Archives: fiscal

Coronavirus-prompted benefit boost won’t help families who are crushed by the Cap

We all thought it was so wonderful when Boris Johnson and his pals told us they were making the benefit system more generous because of the coronavirus.

It turns out the generosity went a very short distance.

For example, the 76,000 families who are subject to the Benefit Cap won’t get a penny more than £20,000 a year (if they’re outside Greater London) or £23,000 a year (if they’re within that boundary.

The Benefit Cap hasn’t been lifted, you see.

The Institute for Fiscal Studies has raised this with the government, as reported by Rightsnet:

the IFS says that, due to the current benefit cap, some families are not reached by the temporary increase in the safety net, including most of the 76,000 families already subject to the cap, and those people who have moved from work without having been continuously employed for 12 months prior to that (and who therefore don’t qualify for a 39-week exemption from the cap).

Commenting on the issue, IFS deputy Director Robert Joyce said –

‘The government has implemented a substantial temporary increase in the generosity of the welfare safety net. But the overall cap on how much a working-age family can receive in benefits will mean that those increases will not benefit most of the around 76,000 families who were already capped on the eve of the crisis, as well as a small fraction of the large number who appear to have lost employment during the crisis. At the present time encouraging families to move into paid work, or to cheaper housing, is less of a priority. The government should therefore temporarily raise or remove the cap.’

For more information, see If the cap doesn’t fit? from ifs.org.uk

Will the government accede to the request? Don’t you believe it!

Source: Government should temporarily raise or remove the benefit cap, says Institute for Fiscal Studies – Rightsnet

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Tax and spend pledges show neither Johnson nor Hunt can be trusted with our money

Johnson and Hunt: I wanted to use the image someone mocked up of them as ‘Dumb and Dumber’ but I couldn’t find it.

Has the Tory leadership election degenerated into a contest about who can lie the most blatantly and get away with it?

If their tax-and-spend pledges are any yardstick, it has.

Jeremy Hunt wants to spend £20 billion from Brexit “war chest” that will only exist if the UK manages an exit deal with the EU – and that would only be available for a year. That’s not enough for permanent changes.

And Boris Johnson promised public sector pay rises that were coming anyway as the years-long Tory-imposed pay freeze finally comes to an end.

According to Paul Johnson of the Institute for Fiscal Studies, both candidates were really saying that they are willing to borrow more money.

This means they are happy to continue racking up the highest national debt in the UK’s history – something for which the Conservatives used to blame Labour at every opportunity.

Labour, meanwhile, is having a great time mocking both candidates’ “reckless spending commitments”.

Jeremy Corbyn’s party went to great lengths to disprove claims that its own spending plans were unfunded during the 2017 election campaign, when Theresa May proved unable to do the same.

Now it seems both Mr Johnson and Mr Hunt are unable to do their maths.

Boris Johnson and Jeremy Hunt have been accused of misleading the public with “extraordinary” tax-and-spending pledges, as leading economists and senior Tories unite in criticism.

The two Tory leadership candidates came under fire after Mr Hunt unveiled a no-deal Brexit spending splurge worth almost £20bn – while a Johnson ally promised big public sector pay rises if the favourite wins.

The spending race provoked alarm from Conservatives, including Philip Hammond, the chancellor, and the former leadership contender Rory Stewart, who warned that such promises would make it impossible to attack Jeremy Corbyn for his “unfunded” pledges.

The head of the respected Institute for Fiscal Studies (IFS) went further, saying the two candidates were misleading voters in claiming they could dip into a £27bn “war chest”.

Paul Johnson pointed out it was a figure for one year only, so could not be used for permanent tax-and-spending changes – and it would not be available at all if the UK crashes out of the EU.

“There have been some extraordinary pledges – they add up into the tens of billions of pounds,” the IFS director said.

“They claim, somehow, that these will be paid for from this so-called Brexit war chest. Well, they are not going to be.

“First, that is only available in the event of no deal not happening. And, in any case, what they are just saying is they are willing to borrow more.”

Mr Hunt, as he set a new deadline of 30 September for a no deal becoming inevitable, pledged £6bn to compensate some industries from tariffs – claiming £1 trillion had been spent to bail out the banks.

But Mr Johnson said: “It is simply not true that, in any real sense, we spent £1 trillion bailing out the banks in the same way that he’s referring to potentially finding £6bn for the farmers and fishermen.”

And, on public-sector pay, he pointed out the freeze was over anyway – arguing the cash now being spent would be in jeopardy from a no-deal Brexit because “the economy will grow less quickly”.

Source: Boris Johnson and Jeremy Hunt accused of duping the public with ‘extraordinary’ tax-and-spending pledges | The Independent

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Boris Johnson’s ‘Garden Bridge’ failure cost you £53m. So much for Tory financial responsibility

Is anyone keeping track of the amount of money these failed Conservative vanity projects are costing the public purse?

Boris Johnson cost us £53 million with this silliness alone, but has everyone forgotten his costly water cannon project?

Chris Grayling haemorrhages money.

The DWP spends a fortune trying to deny help to benefit claimants.

I’m sure you can think of plenty of other examples.

Under the Conservatives, the national debt has more than doubled, but they have insisted on granting huge tax cuts to the super-rich.

And they call themselves the party of financial responsibility. Pathetic.

A failed plan to build a bridge covered with trees and flowers over the River Thames in central London cost a total of £53m, it has been revealed.

A Transport for London (TfL) inquiry showed the Garden Bridge Trust spent £161,000 on a website and £417,000 on a gala for the abandoned project.

The design of the bridge cost more than £9m and the charity paid its executives £1.7m.

Around £43m came from the public’s pocket, TfL added.

Source: Failed London Garden Bridge project cost £53m – BBC News


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Turn again, Tories! Will your policy today be your policy tomorrow?

[Image: Left Futures.]

[Image: Left Futures.]


We all know the answer to that question: It will if it harms people on middle or low incomes, and benefit claimants. The rich will be safe.

So David Cameron’s promise not to cut tax credits was a lie that will harm the hard-working people of the UK, even as the Public Relations Prime Minister works so hard to convince them that they’re better-off under him.

“The Conservatives are the party of the workers” – what utter nonsense!

Meanwhile, George Osborne has U-turned over ‘fiscal responsibility’ laws. Here’s what he had to say about them in 2010:

That was in response to a Labour law that the Conservative-led Coalition government repealed in 2011.

Now he has a ‘fiscal responsibility’ law of his own. What does he have to say about it?

“After all that Britain has been through, it is remarkable that the proposition in this Charter for Budget Responsibility should even be contentious. It states that now the economy is growing we should be reducing our exorbitant debts, and that we should do that each year by reducing the deficit until we eliminate it altogether and run a surplus. Once we have achieved that surplus, in normal times we should continue to raise more than we spend and set aside money for when the rainy days come.”

A child’s economics.

If a government is raising more than it spends, then it is taking money out of the economy; making the economy smaller.

If the economy was growing at a substantial rate – for example, due to the style of investment that Labour is advocating – then it would be possible for a government to achieve this without causing substantial harm. But the economy isn’t doing that. Tory austerity policies have limited the economic recovery since 2010.

Actually, no. Let’s not call them austerity policies any more. Let’s use the term a Vox Political reader rightly chose to describe them: Subjugation.

Subjugation, because the Tories are using their time in office to further enrich the privileged few with tax cuts, taking money from the poor to pay for them.

Subjugation, because the Tories hold themselves unaccountable, refusing to consider any challenges against their policies.

Subjugation, because the Tories intend to use their ‘fiscal charter’ – something George Osborne ridiculed before he took office – to inflict bitter poverty on the hard-working people of the world’s fifth-largest economy.

So let’s learn our lesson – and the lesson is this:

The only Tory promises you can believe are promises made to the rich.

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Named: The Tory hypocrites who voted against ‘fiscal responsibility’ in 2010 – and for it in 2015

George Osborne: During the debate on the Charter for Budget Responsibility, one person on Twitter suggested, "George Osborne would be better off coming to the despatch box & folding a towel into a swan than talking economics."

George Osborne: During the debate on the Charter for Budget Responsibility, one person on Twitter suggested, “George Osborne would be better off coming to the despatch box & folding a towel into a swan than talking economics.”

The only difference is that, in 2015, a Conservative had suggested it.

Tuesday’s ‘fiscal charter’ debate in the House of Commons was full of these hilarious U-turns.

The one that’ll be in all the news media will be John McDonnell’s decision to reverse a policy he announced two weeks ago and oppose George Osborne’s Charter for Budget Responsibility. It is bitterly unfortunate for him that, trying to be heard over the usual Tory catcalls and childishness, he repeated the word “embarrassing” four or five times. That’s what the right-wing media will quote.

And that’s a shame, because he also put to bed – definitively – Tory claims that Labour was responsible for the financial collapse of 2007/8/9 and the global crisis that came with it. He said (boldings mine): “Over six years, the Conservatives have managed to convince many people that the economic crisis and the deficit were caused by Labour Government spending. It has been one of the most successful exercises in mass public persuasion and the rewriting of history in recent times. Today I am going to correct the record.

“The Conservatives backed every single penny of Labour’s spending until Northern Rock crashed.

“The average level of spending under Labour was less than it was under Mrs Thatcher.

“It was not the teachers, the nurses, the doctors and the police officers whom Labour recruited who caused the economic crisis; it was the recklessness of the bankers speculating in the City, and the failure of successive Governments to ensure effective regulation.

“In opposition, this Chancellor and his colleagues wanted even less regulation of the banking sector that crashed our economy.

“The deficit was not the cause of the economic crisis, but the result of the economic crisis.”

John Redwood tried to claim the Tories had warned about the possibility of collapse but, having read numerous accounts of those times, This Writer finds his comment unconvincing. For the record, he said: “I chaired the economic policy review for my right hon. Friend the Chancellor and there was strong advice that tougher regulation was needed on bank cash and capital. We expressly warned that the banks were over-borrowed and over-geared and that the whole system was very shaky, and I remember the Opposition constantly warning about excess debts in the system.”

An economic policy review does not necessarily equate to Conservative Party policy, but nevertheless his claims will have to be checked. Isn’t it interesting that nobody has mentioned this in seven years since the crash happened?

Mr McDonnell also warned us about the consequences of Tory economic policies. Responding to criticism by former Chancellor Kenneth Clarke, he said: “His Budgets balanced, but when they balanced, there were 40,000 homeless families in London. People were dying on waiting lists before they got their operations. Those were the consequences of his economic policies.”

He said if he were Chancellor, he would reverse tax cuts that favour the richest.

He would empower HM Revenue and Customs to chase tax avoiders and end the ridiculous situation that allowed Facebook to pay just £4,500 in its annual tax return – less than many low-income earners.

And he would invest in the UK economy to grow us out of debt.

Let’s have another U-turn – the SNP. According to Stewart Hosie, it now opposes the Charter for Budget Responsibility again. That’s nice, after Nicola Sturgeon’s little speech in support of it on May 26.

In seriousness, Hosie gave a cracking little speech. This Writer’s favourite part was the response to Tory James Cartlidge. Hosie said: “I will happily give way to the hon. Gentleman if he can tell me why he is going to support the economics of the madhouse.

Cartlidge’s reply was: “He talks about punishing the poor, but last week the Office for National Statistics showed that the number of workless households is at the lowest level on record. Does that not show that our strong economy is delivering not only stability, but social justice?”

Not according to Hosie! Without hesitating, he said: “I am absolutely delighted when workless households get one or more people into a job and have the opportunity to better themselves, but what I am not prepared to tolerate is people who work harder than us having £1,300 a year cut from their tax credits, which stops making work pay.”

Also U-turning were the Liberal Democrats, whose Tom Brake told the Commons the party would not support the fiscal charter. This is strange, since the Liberal Democrats helped introduce it, while in coalition with the Conservatives before the general election. Now reduced to just eight MPs, it’s a little late for them to have seen the error of their ways.

But the biggest U-turn was, of course, that of George Osborne and the Conservative Party itself. In 2010, quoting economist Willem Buiter, he said: “Fiscal responsibility acts are instruments of the fiscally irresponsible to con the public.” At the time, 181 of his Conservative Party colleagues agreed with him.

Yesterday, he said: “This budget charter provides the discipline we need along with the flexibility we might require” – and again led his Tory colleagues through the lobby in support of his argument, which was a clear and utter contradiction of their position in 2010.

Making hypocrites of themselves yesterday were:

Afriyie, Adam
Amess, Sir David
Bacon, Mr. Richard
Bellingham, Mr. Henry
Benyon, Mr. Richard
Beresford, Sir Paul
Blunt, Mr. Crispin
Bone, Mr. Peter
Bottomley, Sir Peter
Brady, Mr. Graham
Brazier, Mr. Julian
Brokenshire, James
Burns, Sir Simon
Burt, Alistair
Carswell, Mr. Douglas
Cash, Sir William
Clarke, rh Mr. Kenneth
Cox, Mr. Geoffrey
Crabb, Mr. Stephen
Davies, David T.C.
Davies, Philip
Djanogly, Mr. Jonathan
Duncan, Sir Alan
Dunne, Mr. Philip
Ellwood, Mr. Tobias
Evans, Mr. Nigel
Evennett, Mr. David
Fabricant, Michael
Fox, Dr. Liam
Gale, Sir Roger
Garnier, Sir Edward
Gauke, Mr. David
Gibb, Mr. Nick
Gillan, Mrs. Cheryl
Goodwill, Mr. Robert
Gove, Michael
Gray, Mr. James
Grayling, Chris
Green, Damian
Greening, Justine
Grieve, Mr. Dominic
Hammond, Mr. Philip
Hands, Mr. Greg
Harper, Mr. Mark
Hayes, Mr. John
Heald, Sir Oliver
Hollobone, Mr. Philip
Holloway, Mr. Adam
Howarth, Sir Gerald
Howell, John
Hurd, Mr. Nick
Jackson, Mr. Stewart
Jenkin, Mr. Bernard
Jones, Mr. David
Kawczynski, Daniel
Lancaster, Mr. Mark
Leigh, Sir Edward
Letwin, rh Mr. Oliver
Lewis, Dr. Julian
Lidington, Mr. David
Loughton, Tim
McLoughlin, rh Mr. Patrick
Miller, Mrs. Maria
Milton, Anne
Murrison, Dr. Andrew
Neill, Robert
Osborne, Mr. George
Paterson, Mr. Owen
Penning, Mike
Penrose, John
Pickles, Sir Eric
Prisk, Mr. Mark
Redwood, rh Mr. John
Robertson, Mr. Laurence
Rosindell, Andrew
Selous, Andrew
Simpson, Mr. Keith
Smith, Chloe
Stuart, Mr. Graham
Swayne, Mr. Desmond
Syms, Mr. Robert
Timpson, Mr. Edward
Tredinnick, David
Turner, Mr. Andrew
Tyrie, Mr. Andrew
Vaizey, Mr. Edward
Vara, Mr. Shailesh
Wallace, Mr. Ben
Watkinson, Dame Angela
Whittingdale, Mr. John
Wiggin, Bill
Wilson, Mr. Rob

I make that 92 Tories who are quite happy to throw their principles to the wind.

Oh… There was a question of whether a large number of Labour MPs would abstain in a gesture of defiance against the party’s new direction, and there were a very few abstainers – 21, in fact.

They were: Rushanara Ali, ​​​Ian Austin, Adrian Bailey, Ben Bradshaw, Ann Coffey, Simon Danczuk, Chris Evans, ​​​​Frank Field, ​​​​Mike Gapes, ​​​​Margaret Hodge, Tristram Hunt, ​​​​​Graham Jones,​​​​ ​​​​​Helen Jones, ​​​​​Liz Kendall, ​​Chris Leslie, Fiona Mactaggart, Shabana Mahmood, ​​​​Jamie Reed, Graham Stringer, and ​​​Gisela Stuart.

Some of these names were expected, such as those of Liz Kendall, Tristram Hunt, Simon Danczuk – all of who have earned rebukes from This Blog for behaviour unbecoming of a Labour MP. Jamie Reed resigned as a shadow health minister, practically the instant after Jeremy Corbyn was named the new leader of the Labour Party. And Gisela Stuart covered herself in ignominy when she proposed a “grand coalition” of Labour with the Conservatives, prior to the general election. The SNP had a lot of fun with that one.

Clearly these chumps are out to cause trouble and their future behaviour – or misbehaviour – should be watched very closely. They need to be told in no uncertain terms that their future membership of the Labour Party may be jeopardised if they continue to be embarrassments.

What do their grassroots members think of these antics?

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Does Osborne still think ‘fiscal responsibility’ laws are a ‘con’?

'Con' artist: George Osborne.

‘Con’ artist: George Osborne.

As MPs prepare to debate George Osborne’s new ‘Charter for Budget Responsibility’ – a legally-binding document demanding that the government must balance the books by the 2019-20 financial year – let us consider his words on the subject in 2010.

In January that year, while he was still Shadow Chancellor, Osborne tried to block Labour’s Fiscal Responsibility Act.

He said: “Let us remember what one of the economists whom the Prime Minister himself appointed to the Monetary Policy Committee has said about the Bill. Willem Buiter has said: ‘Fiscal responsibility acts are instruments of the fiscally irresponsible to con the public.'”

Really? Why is Calamity George trying to inflict one on us all now, then?

Osborne went on to quote Michael Saunders of Citibank, who he described as one of the City’s leading economists, thus: “The government’s plans for legislation to cut the deficit are not convincing and are probably just camouflage – a sort of ‘fiscal figleaf’ – for the lack of genuine action.”

A ‘fiscal figleaf’, indeed! Would the ‘Towel Folder-in-Chief’ apply that title to his own work?

Let us hope that somebody in Her Majesty’s Opposition is as clued-in as the Vox Political reader who pointed out these words to This Writer – and points out to the Conservative Government that 182 Tory MPs voted against a Fiscal Responsibility Act in 2010, after their current Chancellor described such legislation as a “fiscal figleal” and a “con”.

Did they believe Osborne, Buiter and Saunders were right in 2010?

If so, then surely they must believe he is wrong – and hypocritically wrong – now.

Their votes should reflect that belief.

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Labour ‘fiscal charter’ rebels are ignoring the evidence

Mr McDonnell in Redcar with shadow business secretary Angela Eagle and constituency MP Anna Turley [Image: Ian Forsyth for the Mirror].

Mr McDonnell in Redcar with shadow business secretary Angela Eagle and constituency MP Anna Turley [Image: Ian Forsyth for the Mirror].

The shock and anger professed by some Labour MPs at shadow chancellor John McDonnell’s decision to oppose George Osborne’s Charter for Budget Responsibility – in line with Labour’s anti-austerity policy direction – defies belief.

Mr McDonnell has claimed his decision was triggered by a meeting with steel workers in Redcar, where the factory is to be closed down after the Conservative Government wouldn’t lift a finger to save it.

He said: “Originally what I said to people was, ‘This charter is a political stunt; it is a political trap by George Osborne; it is virtually meaningless; he ignores it himself time and time again.

“‘He never meets his targets, so this is just a stunt. Let’s ridicule it in the debate and vote for it because it’s a meaningless vote’.”

But then he went to Redcar. “I met the steelworkers and I had families in tears about what’s happened to them as a result of the Government failing to act, failing to intervene.

“I came back and I realised, as the consequence of the Government’s failure to invest in infrastructure, in skills, the cuts that are going to start coming now, I realised that people actually are going to suffer badly.

“It brought it home to me and I don’t want the Labour Party associated with this policy.”

This Blog has already reported that the change of heart was also prompted by the worldwide economic outlook. The Charter commits the government to balancing the books within three years, provided there is not another global crisis. Mr McDonnell announced in a letter to fellow Labour MPs: “In the last fortnight there have been a series of reports highlighting the economic challenges facing the global economy as a result of the slowdown in emerging markets.

“These have included warnings from the International Monetary Fund’s latest financial stability report, the Bank of England chief economist, Andy Haldane, and the former Director of President Obama’s National Economic Council, Lawrence Summers.”

According to the BBC, former shadow chancellor Chris Leslie criticised the U-turn and said Labour should set out its own motion: “To go from one extreme to the other is wrong in economic terms but also it sends the wrong message to the general public as well.

“I think to be fair to John McDonnell this is a very difficult balancing act, it’s a very difficult topic, but it’s incredibly important that he is clear and consistent and explains fully not just what Labour’s position is but also why he backed George Osborne’s surplus a couple of weeks ago and is now against it apparently.”

But Mr McDonnell had already explained his reasoning in the letter to the Parliamentary Labour Party and, according to Paul Mason of Channel 4 News, he had indeed planned to move its own alternative to the charter, and to table amendments – but “both these possibilities have been ruled out by the clerks of the Commons.”

The Guardian reported the responses of Labour MPs John Mann and Mike Gapes: “In a comment piece written for the website Politics Home, Mann said “There has been no debate, nor any consultation within the Labour Party.”

But the new developments Mr McDonnell cites all happened within a very tight period. When was there time for a consultation or debate, prior to last night’s meeting?

Mann continues: “The reality is that to have voted with Osborne would have led to political meltdown in Scotland… New Corbyn supporters would have been bemused and demoralised. It would have been a political disaster with huge consequences.”

On one aspect of this, it seems likely he is correct. SNP supporters, ignoring the vacillation of their own party’s leader on this subject (she opposed it – and Labour – during the election campaign, then supported it after the Tories won. Now it seems she and her party are opposing it again) have leapt to the attack in any case, claiming – improbably – that it is Labour that has wavered, in denial of the fact that a new leadership has brought new policies with it.

New Corbyn supporters are anti-austerity, though. They will be delighted by Mr McDonnell’s decision.

The Graun continued: “Mike Gapes, Labour MP for Ilford South since 1992, took to Twitter on Tuesday morning to condemn his party’s state. ‘There is now no collective Shadow cabinet responsibility in our Party, no clarity on economic policy and no credible leadership,’ he wrote. Challenged by another user of the social media site to show loyalty to Corbyn, Gapes responded: ‘I will show loyalty in the same way as he was loyal to Kinnock, Smith, Blair, Brown, Beckett, Miliband and Harman. Ok?'”

No. How about showing loyalty to the majority of the party who support Messrs Corbyn and McDonnell and the policies they are promoting?

All in all, it seems the Labour leadership won’t be able to do right by these ‘rebels’ (if they can be called that) no matter what they choose to do. McDonnell was criticised on the pretext that supporting the CBR was against his anti-austerity beliefs (and never mind the fact that he explained his reasons for it) and now he’s being criticised for opposing it, in line with his anti-austerity beliefs.

Do these people – Messrs Leslie, Mann and Gapes – realise that they aren’t making sense?

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Swallow this, critics: Labour will oppose the Tories’ fiscal charter

[Image: Guardian.]

[Image: Guardian.]

Surprised? This Writer was – but perhaps we shouldn’t be.

Labour’s position on the Charter for Budget Responsibility, which was trailed by the Tories in the run-up to the general election, has been interpreted and reinterpreted to death by the party’s political opponents.

Initially, under Ed Balls and Ed Miliband, the party supported the charter – on the assumption that the Tories weren’t going to win the election and wouldn’t have a chance to put their idea of what it means into practice.

Others, such as the SNP, immediately claimed that this meant Labour supported the Tory plan to cut £30 billion of public spending. This was nonsense, as This Blog pointed out at the time.

In fact, SNP leader Nicola Sturgeon herself performed a U-turn within weeks of the election. On May 26, she said: “The Charter for Budget Responsibility allows the UK government flexibility to increase spending over its current plans, while still reducing the deficit and debt.” This is a far cry from her previous claim: “The cuts that are required to meet the fiscal criteria in the Charter for Budget Responsibility is £30 billion over the next two years.”

In fact, the Charter does not mention any money figures at all.

Now the SNP – and all the others – will be accusing Labour of U-turning, and of copying the Scottish nationalists; both will now be opposing the Charter and publishing their own alternative proposals.

Shadow Chancellor John McDonnell has announced his reasons in a letter to fellow Labour MPs. The Charter commits the government to balancing the books within three years, provided there is not another global crisis. Mr McDonnell wrote: “In the last fortnight there have been a series of reports highlighting the economic challenges facing the global economy as a result of the slowdown in emerging markets.

“These have included warnings from the International Monetary Fund’s latest financial stability report, the Bank of England chief economist, Andy Haldane, and the former Director of President Obama’s National Economic Council, Lawrence Summers.”

The parlous state of the global economy seems to have provoked a change of heart from Mr McDonnell – or given him an opportunity to underline Labour’s new economic policy. He wrote: “As the nature and scale of the cuts Osborne is planning are emerging, there is a growing reaction not just in our communities but even within the Conservative party. The divisions over the cuts in tax credits to working families are just the first example of what we can expect as the cuts in other departments are exposed and the failure to find additional resources to bridge the growing expenditure gap in service areas like the NHS is revealed.

“I believe that we need to underline our position as an anti-austerity party by voting against the charter on Wednesday. We will make clear our commitment to reducing the deficit in a fair and balanced way by publishing for the debate our own statement on budget responsibility. We will set out our plan for tackling the deficit not through punishing the most vulnerable and damaging our public services but by ending the unfair tax cuts to the wealthy, tackling tax evasion and investing for growth.

“We will rebuff any allegation of being deficit deniers by publishing for the debate our own statement on budget responsibility. We will set out our plan for tackling the deficit not through punishing the most vulnerable and decimating our public services but by ending the unfair tax cuts to the wealthy, tackling tax evasion and investing for growth.

“I have consulted members of the economic advisory council … and the general view is the same. Although we need to continue to bear down on the deficit, they believe that this is not a time in any way to undermine investment for growth strategies.”

According to Paul Mason of Channel 4 News, Labour had planned to move its own alternative to the charter, and to table amendments – but he wrote: “I understand both these possibilities have been ruled out by the clerks of the Commons.”

According to the BBC, George Osborne said Labour’s economic policy had “lurched from chaos to incredibility

“Two weeks ago ‎they said they were going to vote for a surplus – now we know they want to keep on borrowing forever. That would be a grave threat to the economic security of working people‎.”

Interestingly, Vox Political has already published a response to these claims:

z30billionausterity

Mr McDonnell’s decision cements Labour’s position as an anti-austerity party – eliminating criticisms from several areas of the political arena, not least the Labour Party itself. But they’ll try…

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Voting with the Tories on ‘welfare’ will end any credibility Labour has left

George Osborne is a liar, from a party of liars - one only has to consider the UK's secret bombing of Syria - after Parliament voted against it - to see the truth in that.

George Osborne is a liar, from a party of liars – one only has to consider the UK’s secret bombing of Syria – after Parliament voted against it – to see the truth in that.

What an amazing piece in The Guardian about George Osborne’s call for “progressive” Labour MPs to support his entirely regressive changes to social security (the only people who call it “welfare” are Tories)!

Will people believe this pack of lies?

The article starts by saying he has urged “progressive” MPs in the Labour party to back his cuts in a major Commons vote today (Monday) on the Tories’ Welfare Reform and Work Bill.

He wants Labour MPs – but more importantly, the electorate, to think that the plan to cut child tax credits (among other measures) is what the public wants, and also builds on “mainstream Labour thinking”.

This is moonshine.

Labour believes that the profits of all our work should be shared out to ensure a decent standard of living for everybody, including those who cannot work but contribute to society in other ways. For example, if you have children, then you get child tax credits because their contribution to society has yet to be made.

Removing the tax credits and lowering the standard of living – as the Conservative chancellor’s plans would do to many people – is therefore the opposite of “mainstream Labour thinking”.

Osborne also calls on Labour to “stop blaming the public for its defeat”. This is typical Tory gaslighting. As a party, Labour has not blamed the public. The prevailing mood in the party is that Labour needs to draw the correct conclusions from the election result and create policies that acknowledge what the public wants, while fitting Labour values.

That’s real Labour values – not George Osborne’s fantasy.

You can tell that Labour isn’t doing as Osborne claims. Nowhere in the Guardian article is any factual evidence provided to show Labour has blamed the electorate for its defeat. Harriet Harman is paraphrased as having said the party needed to recognise that the electorate had sent Labour a message – which is quite the opposite.

Osborne also fails to support his claim that the majority of the electorate support his cuts. The majority of the electorate voted against the Conservative Party on May 7, with the Tories managing to gain only a 24.3 per cent share of the possible vote and a tiny 12-seat advantage in Parliament. That does not indicate majority support for the cuts programme.

The article states: “Osborne sprung a surprise in the budget by proposing cuts to the level of tax credits, but balanced these in part by a rise in the minimum wage to more than £9 an hour by 2020 for those over 25.” Notice that the tax credit cut is immediate, but the minimum wage will only rise to more than £9 per hour in five years’ time. How are people supposed to survive in the years between?

Also, according to the Institute for Fiscal Studies, the cut in tax credits, along with the other cuts that ‘Slasher’ Osborne wants to make, will remove £12 billion from the economy – but the minimum wage rise – when it finally happens – will only add £4 billion.

So the Conservatives want Labour to support an £8 billion cut in living standards for the people who can least accommodate it.

Osborne’s argument that the responsibility for ensuring decent living standards should be rebalanced, from the state handing out subsidies towards employers providing decent wages, falls because he has no intention of making employers pay decent wages.

Osborne also writes: “Three in four people – and a majority of Labour voters – think that Britain spends too much on welfare.”

Are these the same people who think 41 per cent of the entire social security budget goes on unemployment benefits, when the actual proportion is just three per cent?

Are these the same people who think 27 per cent of the entire social security budget is claimed fraudulently, when the actual proportion is just 0.7 per cent?

Are these the people who believe George Osborne’s lies, and the lies of the Conservative Government?

In case anybody is wondering, the figures quoted above are from a TUC poll that was carried out a couple of years ago. It seems that, with the help of compliant media (such as The Guardian?) the Conservatives have succeeded in continuing to mislead the general public.

Osborne continued: “For our social contract to work, we need to retain the consent of the taxpayer, not just the welfare recipient.”

People receiving social security payments are also taxpayers; indirect taxation accounts for around three-quarters of the taxes received by the UK Treasury from the 20 per cent of people in the lowest income group.

The lies keep coming: “For those that can work, I believe it is better to earn a higher income from your work than receive a higher income from welfare.” If this was true, then he would have forced the minimum wage up to a point at which people would no longer need to claim tax credits in order to receive the same amount. He didn’t; he lied.

Osborne goes on to praise interim Labour leader Harriet Harman for capitulating to the Conservatives over child tax credits. There is only one reason he would do this – to undermine support for the Labour Party by suggesting that it really is ‘Tory-Lite’. Shame on Ms Harman for allowing this to happen!

His claim, “She recognised that oppositions only advance when they … recognise that some of the arguments made by political opponents should be listened to,” would be reasonable if the argument for cutting tax credits was sound, but it isn’t – people will be worse-off in this instance. If people were to become better-off afterwards, he might have a point. As it is, it is drivel.

His very next point confirms this: “A previous Conservative opposition realised [this] 15 years ago when it accepted the case for a minimum wage.” The Conservative Party only accepted this case in 2008, under David Cameron – a Tory leader who, when campaigning unsuccessfully for the Stafford constituency seat in 1996, had said it would “send unemployment straight back up” (The Chronicle (Stafford), February 21 1996). Even now, many Tory supporters despise the minimum wage.

Osborne ended with an appeal for “moderate” Labour MPs to vote with his party.

That would be the end of any credibility Labour has remaining, as a party of Opposition.

According to The Guardian, Osborne said: “The proposals are part of a common endeavour by Labour and the Conservatives to implement difficult welfare reforms.” Again, he is trying to make the public think Labour and the Tories are the same. Labour MPs would have to be complete idiots to help him.

Some of the complete idiots in Labour who have already helped him are, according to Osborne, “New Labour work and pensions secretaries such as John Hutton, David Blunkett and James Purnell [who] all tried to reform the welfare system… Alistair Darling [who] says tax credits are ‘subsidising lower wages in a way that was never intended’ [and] Frank Field… [who] agrees the system as it stands is simply ‘not sustainable’ and the budget represents a ‘game-changer’.”

Wouldn’t social security be a little more sustainable if George Osborne spent less time obsessing about wringing more money from those who can least afford to lose it, and more time getting his extremely rich corporate friend to pay up more of the £120 billion a year they are believed to owe in unpaid taxes?

Why isn’t Labour making this point, whenever Tories like Osborne start bleating that anything is “unsustainable”?

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Cameron’s Conservatives welcome increased poverty in the UK

130617childpoverty

If David Cameron wants to tell us the current definition of child poverty is a bad one, he’s probably right. The problem is, his preferred changes to that definition will probably be worse.

Poverty is currently defined according to whether a household’s income is less than 60 per cent of the national average. So during a recession, when most incomes (apart from those of the very rich) drop, poverty actually appears to decrease.

Now, despite there having been no appreciable rise in incomes across the board, the Institute for Fiscal Studies is forecasting a rise in child poverty from 2.3 million to 2.5 million – that’s 200,000 more children in poverty, as it is currently measured.

For David Cameron, this is a disaster because it shows that – even with the help of the silly sliding-scale definition of poverty, his government is worsening the situation for children across the UK. What an evil man. What an evil government.

His solution, it seems, is to revive plans to change the way child poverty is defined, to ensure that all those children who have fallen on hard times since he came into office (in 2010, not this year – we, at least, can be honest about the effect he is having) may be dismissed from the poverty figures even if they don’t have food to eat or clothes to wear.

The thought of taking action to stop children falling into poverty probably hasn’t even occurred to David Cameron.

It seems he discussed the matter on Tuesday morning with Nicky Morgan, our dunce of an education secretary, Oliver Letwin, the Cabinet Office minister they keep in a back room in case he frightens children, and Iain Duncan Smith, the work and pensions secretary who models his behaviour on the Nazis – any of his solutions are likely to be final.

(In fact, the £12 billion cuts being planned for the Gentleman Ranker’s welfare budget are likely to be fatal to a huge number of people in any case.)

The Guardian‘s report on this points out that “a little-noticed line in the Conservative party’s general election manifesto said the government would “work to eliminate child poverty and introduce better measures to drive real change in children’s lives, by recognising the root causes of poverty: entrenched worklessness, family breakdown, problem debt, and drug and alcohol dependency”.

So the manifesto plan is: Blame the parents.

What are they going to do, then – sanction them (take money away)?

Already popular organisations are starting to line up against the government. Alison Garnham of the Child Poverty Action Group took an early shot at Cameron’s claim to be running a ‘One Nation’ government (a slogan he stole back from Labour after the general election).

“You can’t have one nation if children’s lives, opportunities and life chances at every turn are shaped and limited by poverty,” she said. “The government’s child poverty approach is failing but the prime minister’s speech [on Monday] simply missed the point and failed to set out what his government will do to prevent his legacy being the largest rise in child poverty in a generation.

“It is no good pulling bodies out of the river, without going upstream to see who is throwing them in – especially, if turns out the culprit is government policy. The right choices that would reduce poverty include protecting children’s benefits with the same triple-lock protection pensions enjoy, fixing the deep cuts to tax credit help for the low-paid, tackling cripplingly high rents, high childcare costs and expanding free school meals.”

These things will not happen under a Conservative government. There’s no profit in it for them because children – unlike pensioners, for example – don’t vote.

So, in simple terms, this is the situation:

Child poverty is rising.

The Conservative Party intends to pretend that it isn’t happening by fudging a new definition of poverty.

The Conservative Party will do nothing to tackle the real causes.

What conclusion can we reach?

The Conservative Government welcomes increased poverty in the UK.

Follow me on Twitter: @MidWalesMike

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