Marcus Brigstocke v the Government – has he been reading Vox Political?

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absentee, bank, benefit, bonus, company, cost of living, cynic, demoralise, economic, Economic and Social Research, economy, employee, employer, exploit, financial crisis, financial sector, George Osborne, government, growth, illness, in-work, living, Marcus Brigstocke, Mike Sivier, mikesivier, minimum, morale, National Institute, NIESR, politics, productivity, ruthless, sabot, sabotage, social security, staff, stress, The Now Show, turnover, Vox Political, wage, wages, welfare, work, zero hours contract

This is the first pic I could find of Marcus Brigstocke, as he might have looked while delivering the piece quoted below. He’s a known beardie so he probably had face-fuzz as well.

What a rare and pleasant thing we’ve enjoyed for the last few days – a Bank Holiday weekend with good weather! And isn’t it a shame that this means most of you will have been out, and therefore missed Marcus Brigstocke’s turn on The Now Show.

Here’s a guy who knows how to take the government apart; it seemed as though he’d been reading Vox Political for the last few months because he touched on some of our favourite subjects:

1. The economy

He led with the 0.8 per cent increase in economic growth, mocking the government’s celebratory tone with impressions of how ordinary people took the news, up and down the country (some of the accents were beyond belief).

“Well done, George Osborne,” said Marcus, his voice dripping with sarcasm. “You have proved your theory right, using the Grand Theft Auto model. You have successfully shown that the poor really are like video game prostitutes – if you kick them hard enough, eventually money will come flying out of them.”

Doesn’t this fit nicely with what this blog has been saying about the economy being dependent entirely on the movement of poor people’s money? Those with less spend all – or almost all – of their income and it is this money, being pushed around the system, that boosts profits and keeps Britain going.

He continued: “I know that the state of the economy matters but for the vast majority of people it is as mysterious and cryptic as the shipping forecast… What makes a difference to people is not zero-point-eight-per-cent growth; it’s actual wages and the cost of living.

“The National Institute of Economic and Social Research (NIESR) showed this week that the average worker is £2,000 worse-off since the financial crisis hit,” another common theme here on VP, except in fact it’s £2K per year worse-off. Let’s do a quick shout-out to Jonathan Portes, NIESR’s director, whose Tweets are well worth a read: @jdportes

“I say, ‘hit’. That makes it sound like the crisis swerved towards us. The reality is, the average worker is £2,000 worse-off since the financial sector arrogantly, and with galactic, hubristic stupidity, drove the economy off a cliff, yelling, ‘Does this mean I still get my bonus?’ Of course you’ll still get your bonus. Otherwise you’d leave the country and [chuckling] nobody wants that.” [Laughter from the audience – we’re all in on that joke.]

2. Employment

“More people are in work now; good. But why do employers talk like they deserve a sainthood when they have people working for them? Your company does a thing; you need workers to facilitate the doing of that thing. The workers work, and the thing is done – am I missing something here? Do you feel you need a medal?”

2a. Zero-hours contracts

“One-point-four million British workers are having to scrape a living together from cynical, ruthless, exploitative employers using zero-hours contracts. Value your employees – they are not battery workers; they are people… One in five UK workers earns less than the Living Wage.”

At this point the narrative switches to a spoof advert: “At GreatBigFacelessBastardCorp we care so little about what we do, we pay our workers the minimum wage allowed under the law! That way we can pass on their listlessness and overwhelming sense of defeated apathy to you, the customer! GreatBigFacelessBastardCorp – crushing dreams so you don’t have to!”

This relates to an argument that Vox Political has been having with Tory-supporting businesspeople for years, going back to the earliest days of the blog. Back in January 2012, I wrote False economies that leave the business books unbalanced in which I stated:

It seems to me that many employees are finding life extremely difficult now, because the amount they are paid does not cover all their outgoings and they are having to work out what they can do without. The cost of living has risen more sharply than their pay, so they are out of pocket.

This creates stress, which can create illness, which could take them out of work and turn them into a liability to the economy – as they would then be claiming benefits.

That’s bad – not only for the country but also for their company, because demoralised employees produce poor work and the company’s turnover will decrease; having to bring in and train up new workers to replace those who are leaving through ill health is time-consuming and unproductive.

Therefore, in taking the money for themselves, rather than sharing it with employees, bosses are clearly harming their own companies and the economy.

In fact, it seems to me that this is a microcosm of the larger, national economy. In order to keep more money, bosses (and the government) pay less (in the government’s case, to pay off the national deficit). This means less work gets done, and is of poorer quality (in both cases). So orders fall off and firms have to make more cutbacks (or, revenue decreases so the government makes more cutbacks in order to keep up its debt payments).

[This seems to have been borne out by subsequent events. More people are employed than ever before, according to the government, yet GDP has improved by only a fraction of one per cent in the last quarter. By rights, it should be about 20 percentage points higher than the pre-crisis peak by now, according to some analysts.]

The message to bosses – and the government – is clear: Cutting back investment in people to keep money for yourselves will cripple your earning ability. Cutting even more to make up for what you lose will put you into a death spiral. You are trying to dig your way out of your own graves.

But there is an alternative.

A reasonable pay increase to employees would ensure they can pay their bills, and would also keep them happy.

Happy workers produce better results.

Better results keep businesses afloat and earn extra work for them.

That in turn creates more revenue, making it possible for bosses not only to increase their own pay but employ more people as well.

Wouldn’t that be better for everybody?

Well, wouldn’t it?

3. Welfare lies

“Young workers are amongst the hardest-hit by the downturn, with pay falling by 14 per cent between 2008 and 2013. Well done, everybody! We pay far more from the welfare budget supporting incomes for people in work than we do for those out of a job.

“The government keep on crowing about the number of people they have in work … most of them are not so much in work as near some work, if only they were allowed to do any.

“If you’re on the minimum wage, kept on a zero-hours contract between 7am and 7pm so you can’t work for anyone else but rack up a grand total of – ooh! – just enough hours so your employer doesn’t have to pay your National Insurance [another VP theme], you get no training, no employee benefits, no hope of any promotion and you hear ‘IDS’ banging on about how he’s ‘the saviour of benefits street’, well, if you can still afford a shoe then please throw it at the radio or through the telly or at his actual face.” This is a reference to sabotage, in which workers threw their crude shoes – or ‘sabots’ into machinery to stop it working, in protest against their working conditions and developments that were endangering their jobs.

“Low pay means higher staff turnover, high absenteeism, poor morale and lower productivity.” That’s exactly as I stated in the VP article from 2012.

4. In conclusion

“I don’t know when money started making money faster than people but… It’s not helping,” said Marcus, truthfully. “So instead of running about with your shirt over your head doing ‘airplane arms’, shouting ‘Nought-point-eight-per-cent’… do something to get the people who actually work to be rewarded, recognised and remunerated for what they do.

“It’s not rocket science and, frankly, if it is, I sincerely hope they’re not on minimum wage.”

When I heard that piece, I very nearly stood up to applaud. If you want to hear it yourself (and I’ve left out enough of it to make it worthwhile, I promise you), it’s available for download here, and starts around eight and a half minutes in.

Actually, it would be better if Marcus hasn’t been reading this blog, because then he would have drawn the same conclusions, from the same evidence, thereby reinforcing my own reasoning.

Now, let’s have your opinions, please. I’ll be very interested to hear from supporters of the current “pay-’em-the-bare-minimum” policy as they almost invariably say things like “We can’t pay them any more” – it’s never “They have good reasons that mean they can’t pay us more”.

Interesting, that.

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Osborne brings in new tax avoidance laws; city minister undermines him

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Andrea Leadsom, Andrew Mitchell, avoidance, Bandal, bank, banker, bonus, Conservative, financial transaction, George Osborne, government, help to buy, inheritance, Mike Sivier, mikesivier, offshore, Philip Hammond, politics, tax, Tobin, Tories, Tory, Treasury, Vox Political

Andrea Leadsom [Image: The Independent].

George Osborne’s latest attempt to make us think that Conservatives can be tough on tax avoiders has lasted less than a week.

The part-time Chancellor announced measures that meant avoiders faced bigger fines and were more likely to go to jail, on April 12.

What a shame his new city minister, Andrea Leadsom, is facing hard questions over actions she took to cut her own inheritance tax bill, just six days later.

Ms Leadsom is now responsible for the government’s Help to Buy property scheme, making this even more embarrassing as the allegations against her refer to shares in a property company.

The allegation is that she took advantage of offshare banking arrangements for her buy-to-let property company, placing her shares into controversial trusts in order to reduce her inheritance tax bill, for the benefit of her children.

The property firm Bandal, created by Ms Leadsom and her husband, another ex-banker – also created charges over two of its buy-to-let properties in favour of the offshore branch of an investment bank. Apparently this indicates that she obtained loans from the Jersey-based bank that were secured against the buy-to-let properties.

While none of the above is actually unlawful, it does mean there is at least one alleged tax avoider – not only in the Conservative Party but in the Treasury. The self-styled ‘Party of Financial Competence’ has become, once again, the Party of Financial Fiddles.

According to The Independent, “Since becoming an MP, Ms Leadsom has campaigned vigorously against bankers’ bonus caps and a financial transaction ‘Tobin’ tax.

“It is not the first time millionaire Tory ministers have been caught up in tax avoidance claims.

“The Defence Secretary Philip Hammond, former Chief Whip Andrew Mitchell and Mr Osborne were all accused of legal tax avoidance in 2010 by Channel 4’s Dispatches programme. All three men denied any wrongdoing.”

This is a serious embarrassment for George Osborne, who told the nation, “If you’re hiding your money offshore, we are coming to get you,” in a speech last week.

In the case of Ms Leadsom, it seems, he doesn’t have far to go.

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Peter Oborne is right to support the 50p tax rate

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… but wrong about many, many other matters.

The Torygraph‘s chief political commentator was right to come out as a supporter of Ed Balls’s pledge to raise the top tax rate back to 50p in the pound.

He was right to say it was “profoundly shaming and offensive” for Conservative voters – especially those who are not super-rich – when George Osborne lowered the top rate to 45p, two years ago.

He was right when he wrote that “to make the rich richer at the same time as making the poor poorer – what George Osborne has been doing – is simply squalid, immoral and disgusting.

“Any decent human being must surely feel sick in the stomach that he is taking this action at the same time as cutting the amount of tax paid by people earning more than £150,000.”

To that, let’s add a point about the kind of people who are benefiting from the lower tax rate – the kind of people who take home around £1 million a year in basic pay, who are promised bonuses of up to twice those yearly salaries, and who caused the financial crisis that has allowed Osborne to pursue his policy of impoverishing the poor.

That’s right: George Osborne’s 45p tax rate is a £100,000 extra bonus, every year – in gratitude for all their help, one must presume – for bankers.

Oborne is also right to say that Labour’s decision in the 1970s, to impose a top tax rate of 83p in the pound, was a huge mistake – for whatever reasons. It genuinely drove people out of the country, whereas at 50p they just grumble and threaten to go.

All of the above being said, Oborne continues to espouse some utterly wrong-headed nonsense. He claims that “the Conservative Party is not an interest group which represents only the very rich” when all of its actions since getting into office in 2010 demonstrate ample proof that a minority group representing only the very rich is exactly what it is.

Oborne actually puts in print: “The Coalition government has devoted a great deal of effort to lowering the living standards of the poor. I support this project.”

It’s great to see a Tory voter actually admitting this, but imbecilic behaviour for a columnist who (one presumes) wants people to respect his point of view.

He goes on: “I believe that Gordon Brown’s welfare state forced some people into a life of dependency… There have been many people on welfare who need much more of an incentive to return to work.”

Wrong, wrong, wrong.

The reason many people are without jobs and claiming benefit is, there are almost five jobseekers for every job. This is a situation created by the Tory-led government in order to keep wages low; with so many people clamouring for jobs, people who do have work but are on the bottom rung of the employment ladder can’t ask for a raise – they would be jettisoned and replaced by a jobseeker (most likely on lower basic pay than the original holder of the job).

Nobody was forced into a life of dependency by Gordon Brown; the vast majority of unemployed people genuinely want to improve their situation with a job that allows them to avoid claiming benefits – and it is good that the Labour Party, if returned to office next year, will work hard to bring the Living Wage into force for all working people.

You see, Mr Oborne and his ilk conveniently forget that the vast majority of people whose living standards have been hit by the Tory war on the poor are in work. They are so poorly-paid by George Osborne’s corporate friends that they have to claim tax credits – or, as I like to call them, Employer Subsidy – and housing benefit – otherwise known as Landlord Subsidy.

That’s improper use of our tax money. We should not be subsidising fat corporates with our hard-earned taxes, so they can deliver ever more swollen dividends to their shareholders; and we should not be subsidising greedy landlords who charge multiples of what their properties are worth to tenants who have nowhere else to go if they want to keep their pittance-paying job.

It is valid to criticise Gordon Brown for allowing this to happen, but who knows? Maybe this figurehead of neoliberal New Labour was using tax credits as a stop-gap, intending to persuade corporate bosses round to the Living Wage in good time. We’ll never know for sure.

There remains a strong argument that government schemes to get people into work should have checks and balances. As underwriters of these schemes, we taxpayers need assurances that the firms taking part will not abuse their position of power, using jobseekers until the government subsidy runs out and then ditching good workers for more of the unemployed in order to keep the cash coming. That is not a worthwhile use of our cash.

We also need assurances that participants won’t drop out, just because life on the dole is easier. I was the victim of several personal attacks last week when I came out in support of Labour’s compulsory job guarantee, because they hated its use of sanctions. I think those sanctions are necessary; there should be a penalty for dropping out without a good reason.

In a properly-run scheme, those sanctions should never be put into effect, though. That means that any government job scheme needs to be driven, not by targets but by results.

Look at the Welsh Ambulance Service. Targets imposed by the Welsh Government mean that ambulances are supposed to arrive at the scene of an emergency within eight minutes – even if they are 20 minutes’ fast drive away, on the wrong side of a busy city like Cardiff, when they get the call. This means the Welsh Ambulance Service faces constant attack for failure to meet targets.

But what kind of results does the service achieve? Are huge numbers of Welsh patients dying, or failing to receive timely treatment because an ambulance arrives a minute or so after its target time? No. There will, of course, be some such occasions but those will most likely be the result of many contributory factors.

So: Results-driven schemes will put people into jobs and improve the economy; there is no need to impoverish the poor; the very rich never deserved their tax cut; and Ed Balls is right to want to re-impose the 50p rate.

The Conservatives are wrong to attack poor people; there is no need to impose further cuts on social security as part of Osborne’s failed austerity policy; and these things show very clearly that the Tories are a minority-interest party supporting only the extremely rich.

In the end, I find myself agreeing with one more comment by Mr Oborne; Ed Balls really has “given ordinary, decent people a serious reason for voting Labour at the coming election”.

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Workplace battleground: Labour and Tories at war over employment

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banker, benefit, benefit tourism, bonus, compulsory, Conservative, David Cameron, employment, English, general election, guarantee, I'm not racist but, Iain Duncan Smith, immigrant, improve, Institute, IPPR, job, Jobseeker's Allowance, Labour, Liam Fox, literacy, long term, Lynton Crosby, math, Michael Gove, Mike Sivier, mikesivier, national debt, numeracy, pension, Pensions, policy, politics, public, Rachel Reeves, relief, repress, Research, school, secretary, service, shadow, skill, social security, tax, Tories, Tory, translation, unemploy, unemployment, Vox Political, wage, welfare, work, workplace, xenophobe, xenophobic, young

Labour is forging forward with new plans to improve work prospects and the skills of those seeking employment, while the Conservatives are plunging backward with proposals to penalise people who lack the ability to speak basic English.

Already right-wingers in the media have been trying to undermine the policies announced by Rachel Reeves in a speech to the Institute of Public Policy Research. They say Labour is planning to strip people of their benefits if they don’t take classes to improve their English and Maths skills, if necessary.

This talk of punishment for people who need help is completely wrong-headed. If someone can’t get a job because they can’t read, write or do their sums, then they should get help. Of course they should.

One has to wonder what has gone wrong in our schools, to lead to this situation. Perhaps Michael Gove would like to take responsibility? No, didn’t think so.

In fact, the plans announced by the Shadow Work and Pensions Secretary are perfectly reasonable – especially in contrast with the latest Tory madness, but we’ll come to that soon enough.

We already know that the centrepiece of Labour’s economic plan is a compulsory jobs guarantee for young people and the long-term unemployed.

This means anyone over 25 who has been receiving Jobseeker’s Allowance for two years or more, and anyone under that age who has been receiving the same benefit for one year or more would get a guaranteed job, paying at least the minimum wage, for 25 hours a week – coupled with training for at least a further 10 hours a week.

This is perfectly reasonable. If you have been looking for work for more than a year, and couldn’t get it yourself, then the extra income provided by such a placement (especially coming in line with Labour’s plan to increase wages, in order to really make work pay, rather than depressing benefits and putting everyone in poverty, which is Conservative policy) will be welcome.

It doesn’t mean that people will have to put their own ambitions on hold. The best advice I ever received was to get a paying job during the day, in order to put food on the table and clothes on my back, and work on what I really wanted to do in the evenings. Eventually, with perseverance, it should be possible to replace the day job with what you really want to do.

Most of the jobs are likely to be in small firms where, once a company has invested six months in a new recruit, the chances are they will want to keep them on after the subsidy has ended.

The jobs guarantee would be fully funded by repeating the tax on bankers bonuses – they were in the news recently, when it was announced that these people would be receiving unearned bonuses worth twice as much as their salary so they’ve definitely got the cash to spare – and a restriction on pension tax relief for those on the very highest incomes.

But – of course – putting people into a job isn’t much good if they don’t have the knowledge of English and Maths that most of us use without thinking in our everyday lives.

In her speech, the Shadow Work and Pensions Secretary said: “The shocking levels of English and maths among too many jobseekers are holding them back from getting work, and trapping them in a vicious cycle between low paid work and benefits.

“Nearly one in 10 people claiming JSA don’t have basic English skills, and over one in ten don’t have basic maths. IT skills among jobseekers are even worse; nearly half don’t have the basic email skills which are now essential for almost any job application.

“And we know that this keeps people out of jobs: those out of work are twice as likely than those in work to lack basic English and Maths,” she said, proving that her own lack in that area hasn’t held her back. Twice as likely as those in work, Rachel.

She said research has shown that, when people who lack these skills do get jobs, they too often find themselves in short term or temporary work, with a swift return to benefits. Nearly one in five of those who have made multiple claims for unemployment benefits have problems with reading or numeracy.

The response: “A new requirement [will be] for jobseekers to take training if they do not meet basic standards of maths, English and IT – training they will be required to take up alongside their jobsearch, or lose their benefits.

“[We] will ensure that people’s skills needs are assessed, and basic skills gaps addressed, from the start of a Jobseeker’s Allowance Claim, not after months and years of neglect.”

Contrast this with the Conservative Party’s latest plan to hammer immigrants and people on benefits – announcing a new policy of repression every week ahead of the election in 2015, according to politics.co.uk

It seems right-wing Australian election chief, and tobacco lobbyist, Lynton Crosby thinks this kind of bully-boy behaviour will make the Tories more popular! Don’t laugh.

This comes after satirical radio comedy The Now Show featured a sketch in which people tried to justify xenophobic attitudes without saying the words “I’m not racist, but…”

Let’s try the reverse – putting those words into the new policies announced on politics.co.uk:

“I’m not racist, but we should strip benefits from anyone who can’t speak English!” (Does this include the English people who can’t speak their own language properly, who Labour plan to help?)

“I’m not racist, but we should axe the service telling people about benefits in foreign languages!”

“I’m not racist, but we should end translation services in benefits offices!” (According to politics.co.uk, David Cameron is very keen on that one).

The site said “Iain Duncan Smith is understood to already be working on them”. (He’s not racist, but…)

Tory backbencher and former scandal Liam Fox tried to justify this lunacy by saying: “The ability to speak English is one of the most empowering tools in the labour market and we should be encouraging as many people as possible to learn it.” By cutting off their income? How does that work?

Plans to focus on the government’s increasingly racist tough anti-immigrant message come despite warnings that a reduction in immigration would make it harder for Britain to pay back its national debt.

The site said that, last week, a long-awaited report into benefit tourism had to be shelved in secret, after failing to find any evidence of it.

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Turncoat Tory’s blue-sky talk can’t hide the damning truth

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allowance, Atos, bank, benefit, benefit uprating, benefits, bonus, cap, Coalition, Conservative, cost of living, cut, David, David Cameron, debt, Department for Work and Pensions, disability, disabled, DWP, employment, Employment and Support Allowance, ESA, Freud, global prices, government, Iain Duncan Smith, income, inflation, Labour, Lord, low, Mike Sivier, mikesivier, millionaire, one per cent, people, politics, price, real, rise, sick, social security, support, tax, threshold, Tories, Tory, turncoat, unemployment, unum, Vox Political, wage, welfare, work, Working Tax Credit, zero hours contract

A head up his own behind: David Freud doesn’t want to make work pay – he just wants you to think he does.

Here’s another Tory who should go boil his head: David Freud.

This former Labour advisor on social security – who had previously worked in the city, setting up company share flotations (and if that isn’t a deeply worrying connection, what is?) – crossed the floor to the Conservative Party when he realised Labour wasn’t going to keep power in 2010, and was rewarded with an utterly undeserved peerage.

It is possible that he has done at least as much harm to the unemployed as Unum and Atos, along with an equal amount of harm to those on low wages.

He has written a worthless screed in the Huffington Post, no doubt part of an attempt to soften us all up for a new assault on the workless. We’ll get to his words in a moment. First, let’s look at the current situation, as created by the David Cameron government that Freud serves.

Under the current government, real wages have fallen in 36 out of 37 months – the only month when they didn’t fall was April 2013, when millionaires had their tax cut and bank bonuses rocketed. You can be assured that ordinary wages continued to plummet.

This has been led, of course, by the social insecurity policies adopted by Freud. The plan has always been to make life extremely difficult for the unemployed, ensuring they will chase work wherever they can find it – no matter how poorly-paid. This is why zero-hours contracts have gained the prevalence they have, which would be unacceptable in a civilised society.

It also means that company bosses can push wages down, even if prices are rising and people are facing a cost of living crisis – because they can always say there are plenty of unemployed people willing to take a complaining worker’s place.

And prices are rising. Inflation has been above the current two per cent target throughout Cameron’s administration, meaning that, in 2011, 70 per cent of people saw their real wages fall as pay packets failed to keep up with inflation. Families were an average of £891 worse-off in the current financial year because of tax rises and cuts to tax credits and benefits introduced since 2010 – negating the much-touted £600 that was given back when the Coalition raised the threshold for tax payment.

The government has blamed high inflation on “rising global prices” but this is nonsense – inflation in other G7 countries has been lower than in the UK, disproving the claim.

Wages after inflation are forecast to be £1,520 lower in 2015 than in 2010, meaning that working people, on average, will have lost a total of £6,660 in real terms under the Coalition government of David Cameron.

It is against this background that David Freud has written, in the Huffington Post, about what he seems to think are his government’s successes in forcing unemployed people to chase your jobs, thereby keeping your wages low. They can’t go after other jobs, you see – this government hasn’t lifted a finger to create any!

“The benefit cap is now in place across the country,” he began. “This means that benefit claims are limited to a fair level, a maximum of the average working household earnings of £500 a week.” Instantly, he is distorting the truth. The income of an average household earning that much would be topped-up with benefits totalling a further £105 or thereabouts. The benefit cap is, therefore, intrinsically unfair.

“The taxpayer who funds the welfare state has the assurance that someone in receipt of benefits no longer has an income that’s beyond the reach of the average working family.” A flat-out lie. The average benefit recipient never received more than an average working family. As a rule, benefits totalled one-sixth of wages and the one per cent limit on benefit uprating over the next three years – no matter what inflation does – means a huge drop in real terms during that period.

“The benefit cap has removed the barrier some people faced getting into work.” Another lie. The barrier that was stopping people getting into work was a lack of jobs that paid enough for people to cover their costs. Freud and his government want you to compete for jobs that put you into debt at a s-l-I-g-h-t-l-y slower rate than if you were unemployed.

“I must be clear, the old system failed people. If benefits provide an income well above wages, sticking to receiving state support over going out to work is too easy a decision to make.” A false premise. Benefits never provided an income well above wages – except for people in extraordinary circumstances (and those people had stopped receiving such income before the benefit cap was imposed). It’s lie after lie with this man.

“Our reforms put getting into work at the top of the agenda.” No – they set working class people against each other, scrabbling for jobs that pay marginally more than benefits while employers compete in a race to the bottom, to see who can get away with paying the least.

“Universal Credit will make sure it pays to work and the benefit cap ensures a lifestyle on benefits is not a lifestyle beyond the reach of the average household.” Universal Credit is, as we all now know, a money pit into which Iain Duncan Smith has poured hundreds of millions of pounds and received nothing in return. The average household will soon endure a lifestyle – in work – that is almost indistinguishable from one on benefits, as wages continue to fall.

“That is why alongside putting the cap in place, we made sure that people who get a job and are eligible for working tax credits are exempt.” But hasn’t this government made working tax credits harder to claim?

“We have ensured that households who should be exempt, such as people claiming disability benefits as well as war widows and widowers, have not been affected.” What about sick and disabled people on Employment and Support Allowance, which is not classed as a disability benefit even though it is paid to people with disabilities? They have been dying in their thousands as a result of Freud’s policies.

Yes, this man’s ideas kill.

David Freud’s middle initial is ‘A’. Someone recently pointed out that initialising ‘David A Freud, Tory’ gives you the acronym ‘DAFT’.

You’d have to be daft to believe him.

Sunny summer was good for the economy – shock! All YOU get is a tan

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austerity, bank, BBC, bonus, British Chambers of Commerce, Chloe Smith, Coalition, Conservative, cost of living, cut, David Cameron, David Kern, debt, deficit, Democrat, earnings, economy, G7, general election, George Osborne, government, income, inflation, Lib Dem, Liberal, living standard, Mike Sivier, mikesivier, millionaire, Olympic, people, politics, riot, spending, tax, Tories, Tory, tourism, Vox Political, work, YouGov

At risk of seeming to be ‘Disgusted of Tunbridge Wells’: Why, oh why, oh why is everybody making such a big fuss about the fact that the economy bounced back a little bit over the summer?

Did nobody think that, perhaps, the fact that it was more sunny than in recent years meant our tourism industry might get a much-needed shot in the arm – not least from run-down British people, desperate for relief from the constant, grinding monotony of the Conservative/Lib Dem Coa-lamity government’s austerity agenda?

Did they not recall that the holiday season is a traditional ‘lull’ period and that, therefore – unless unusual situations apply (as they have in previous years) – government spending should be less? What’s the relief to the public purse from not having any Olympic Games to stage this year? What’s the benefit of having no riots?

And, finally, for the vast majority of the British people, these figures are no reason to celebrate because they make no difference. The cost of living is going up while average real-terms earnings have plummetted. If we are seeing a recovery, it is a recovery for the rich alone.

As was always intended.

For the record, public sector borrowing for August was £13.2 billion – £1.2 billion lower than the amount recorded in August 2012. This puts the UK’s net national debt at £1.19 trillion – 74.6 per cent of Gross Domestic Product.

GDP itself grew by 0.7 per cent in the second quarter of 2013 (April-June), and tax revenues have been 2.8 per cent higher than in the same period of 2012. Total government spending has fallen by 2.2 per cent, led by a sharp drop in spending by individual departments.

You can read all this on the BBC News website and might find it pleasant enough, but then David Kern, chief economist at the British Chambers of Commerce had to ruin it by saying “Our ability to generate tax revenues will struggle to return to pre-recession levels, even when the pace of growth picks up. As a result, the government must continue to make cuts in current spending in order to reduce the deficit further.”

So he wants the madness to continue. I wonder… If his business was in trouble, would he cut investment in – say – advertising and then expect profits to improve? That would be madness. Every pound cut from public investment by the government results in a loss to the economy of £1.70-£2.20. It is the government’s own demand for austerity that is slowing the recovery!

And what does this mean for ordinary people?

It means that, after adjusting for inflation, average earnings are £1,350 per year lower than they were at the time of the 2010 General Election. The UK has suffered the biggest fall in income and living standards of any country in the G7. You are worse-off under the Conservatives and the Liberal Democrats!

By 2015, average wages are forecast to be £1,520 lower than in 2010 (based on figures from the House of Commons Library). This means working people will have lost an average of £6,660 in real terms while David Cameron has been Prime Minister – enough to support the average family’s weekly shop for one and a half years, at 2012 prices!

Inflation has been higher than in other G7 countries throughout David Cameron’s period in office, meaning that George Osborne’s claim that “rising global prices” have forced the cost-of-living increase is nonsense.

Claims like that of then-Treasury Minister Chloe Smith at the start of 2012 that lower inflation meant “the cost of living is coming down a little for families” were also rubbish – it was still increasing; just not quite as fast.

In fact, price rises have outstripped wage growth in every single month of the Coalition government – except April this year, when David Cameron cut taxes for millionaires and bank bonuses skyrocketed. Who benefited? The rich. Who lost out? The middle classes, workers, and the poor.

A YouGov survey of ordinary people has shown that 70 per cent do not believe the much-touted recent improvements in the economy have helped middle- and lower-income families. Only 10 per cent thought they had.

And 81 per cent had seen prices grow faster than household incomes, with just three per cent (and only one per cent of women) seeing income grow faster than prices.

It doesn’t matter what they say the economy is doing. You will continue to lose money as long as you have a government of millionaires, ruling in their own interests rather than the interests of the country.

It’s as simple as that.

A ray of light in these dark times as employee-owned firm announces huge staff bonus

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banker, bonus, Coalition, Conservative, David Cameron, economy, George Osborne, John Lewis, Mike Sivier, mikesivier, Nick Clegg, people, Vox Political, Waitrose

As Britain continues to endure the Cameron-Clegg-Coalition nightmare, it seems moments of joy are few and far between. That is why we must make the most of every one that comes along.

Today we had a cracker – on the day that David Cameron announced the continuation of his repressive anti-growth policies, no less.

The John Lewis Partnership, which includes the Waitrose group of supermarkets, has announced a 17 per cent bonus for every single member of staff, after reporting a rise in profits.

That is equivalent to nine weeks’ extra salary, and is an increase from the 14 per cent paid out last year.

The firm is one of the few in the UK that is actually owned by its employees. The success proves something that this blog’s author has been saying for many years – that the best possibly business model is on in which everybody working at a firm is a shareholder in it. If everybody has a stake, everybody takes some of the profit.

No less than 84,700 people will receive this bonus. They will take that money and spend it in their local communities, on things that they need. That money will then go on to keep other businesses alive, and it is to be hoped that the fiscal multiplier process means it could create more wealth, helping the UK economy.

That is worth much, much more than the empty words David Cameron was throwing out during his speech earlier today – a speech on which this blog has already poured its disdain.

And let’s bear in mind that the amount these partners are getting is a much more honest figure than the bankers’ bonuses, for which Mr Cameron and his part-time Chancellor, Mr 0sborne, have been fighting so vigorously. The John Lewis staff actually deserve the money they are getting because it is based on the profits they have generated. The bankers’ bonus is based on nothing more than what they want.

If the UK is going to climb out of the current depression, it needs a few more companies like John Lewis – and a lot fewer politicians like David Cameron.

When are the banks going to give our money back?

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Any Questions, bank, banker, BBC, bonus, cap, criminal, David Cameron, debt, deficit, economy, EU, european union, government, Justice, Mike Sivier, mikesivier, people, politics, prosecute, Vox Political

It is easy to forget how angry we should be at the bankers.

They made an almighty mess of the economy, then they accepted so much money from the government to keep them afloat that they crippled us for years to come, and then they carried on exactly as if nothing had happened.

Their banks are still losing money but the bankers are still taking home huge bonuses, on top of their huge salaries. Some of these bonuses are measured as multiples of their basic pay.

Can you imagine the outcry if all the rest of us demanded to be treated that way?

David Cameron, our comedy Prime Minister, is fighting a European Union scheme to cap those bonuses, saying that without the incentive of huge gobs of cash, these bankers – who caused the crash, remember – will leave the UK. He thinks we need them. According to the BBC’s Any Questions today, he might have a point.

It depends whether all those bankers, with their bonuses, will be paying the full 50 per cent rate of income tax. If they are all doing so, then, fair enough, we need them, because that money goes back into the national bank account and helps us out. If not – and this seems far more likely – then why keep them? There are plenty of others, in jobs lower down the scale, waiting their turn. Considering the mess that was created in 2008, they’ll probably do a better job.

If Mr Cameron really wants all those bad bankers to stay in the UK, he would be more popular if he quoted a different reason: Justice. How many British bankers have been prosecuted for causing the crash? Is it even possible to prosecute them for it? If not, how can they be punished, other than by docking their salaries or pay? Making the banking institutions themselves pay up is not useful in this instance, because it assigns no personal responsibility.

There is the issue of whether the bankers are actually managing to re-stabilise our financial institutions. If so, then that might be considered a good reason to continue providing their bonuses. If a bank’s losses go down from billions to merely hundreds of millions, is that a justification for paying out hundreds of millions more in bonuses?

It all seems very complicated.

But that doesn’t mean we should stop being angry about it, and it doesn’t mean we should stop seeking compensation for it.

The bottom line is that the banks have absorbed hundreds of billions of pounds that belong to British taxpayers, and now the vast majority of British taxpayers are having to go without, due to a shortage of cash, while the bankers – with their bonuses – are allowed to continue their profligate lifestyle.

What better demonstration could there be, of the fact that we are definitely not “all in it together”?

The honourable thing to do, for the bankers, would have been to make a solemn commitment to provide restitution for all the damage they caused, and to agree not to demand bonuses or to move elsewhere until that restitution has been provided in full.

But these are not honourable people.

Maybe it would be better to point out that we do have banks that are owned by the state. Perhaps we should take the view that, if those other banks that received so much money are now so rich that they can continue paying out enormous bonuses, then they are clearly in a position to pay back their debt to the nation and return the money that was provided to them. If they are unable to do so, then they should be broken up, with citizens’ accounts absorbed into the nationalised banks (to safeguard our savings), and the rest of the organisation sold off piecemeal to pay off the debt.

Hang that threat over them, and let’s see what happens!

But we won’t see that, will we?

It isn’t going to happen, and it’s just the naive speculation of a lay spectator, viewing it all from the outside.

Still, it’s a starting-point.

Does anybody with more expertise have a practical plan to get our money back?

Labour’s Eastleigh defeat could provide a map to general election victory

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While Cameron and Clegg beat themselves – and each other – up over Eastleigh, Miliband can learn the lessons and prepare for victory in 2015 – if he wants it. (Cartoon: The Spectator)

Most of the UK is probably sick to death of Eastleigh by now.

We all woke up to the news that the Liberal Democrat candidate had narrowly held the seat for his party, with UKIP as the surprise challenger. The Conservatives came an ignominious third and some commentators have tried to get mileage from the fact that Labour came fourth.

The fact of the matter is, Eastleigh is extremely Liberal Democrat. The local council is entirely Lib Dem, if reports on last night’s Question Time are to be believed, and the party held the Parliamentary seat, even against Labour’s landslide of 1997. The headline result is no surprise.

But this election has shaken out a wealth of detail and the Labour leadership should study it well.

All parties agreed that the main national issue on the doorstep was immigration and the influence of Europe – this is why UKIP won so many votes. The British people think an undemocratic European bureaucracy has far too much influence over their lives and Labour now needs to shape its policy with that in mind. The correct way forward is to seek reform of the European institutions, to return power over matters like immigration – among others – to sovereign nations. Labour would do well to start discussing these matters with politicians in other EU countries, in order to seek consensus on a way forward.

Of course immigration into the UK has fallen, according to the latest figures, and the Conservatives have been quick to leap on this as a vindication of their current policies. It’s a bold claim, but not really supported by the evidence. What we’re seeing is an evaporation of interest in a country that is no longer an attractive place to live or work. So the Conservatives are admitting their policies are putting people off the UK. We’ll come back to this later.

The other big issue is a perennial problem for politicians: Honesty. If Labour comes away with anything at all from this by-election it is that the party must keep faith with the electorate. The Liberal Democrat share of the vote fell by more than 14 per cent – in what that party calls it’s own backyard. The blame for this can be fairly put on Nick Clegg, who spent the last week squirming under questioning about allegations against Lord Rennard. Did he know anything about this before? At first he denied any knowledge but when evidence came to light, he had to admit that he did. Is this an honest man? Of course not. As someone mentioned on Question Time, he said he was sorry in his video apology for U-turning on student tuition fees, but his current behaviour shows he isn’t at all.

Of course the honesty deficit in the Conservative Party beggars belief. How many of David Cameron’s election promises have proved to be untrue? Can anybody keep score any more? We’re all aware of the great betrayal of the National Health Service – and you can only hope for the success of opposition to the new regulations his government quietly introduced, to enforce privatisation of health services in England from April this year. That’s next month.

There are many other examples. To choose one that is topical, he promised that the bankers who caused the economic crisis would be made to pay for the disaster they caused. In fact, he is even now fighting to make sure that the European Union does not put a cap on the obscenely bloated bankers’ bonuses, that are still being paid by the UK’s financial organisations to the people who caused the crisis, even when those organisations have been losing billions of pounds per year. His reasoning for this is that these financial experts (and I use the word sarcastically) would probably leave the UK if they weren’t guaranteed these huge bungs all the time. Good riddance, I say. There are plenty of people both willing and able to fill the void and I dare say they would do a better job. Mr Cameron is trying to reward the financial betrayal of Britain. It is interesting to note, getting back to the point on immigration, that he has no problem with letting foreign bankers into our country.

His attitude to the richest in society contrasts brutally with his treatment of the poorest. It seems, if you are rich, you need a tonne of money to motivate you into work; if you are poor, you need to be made poorer, according to his philosophy. That is why the benefits budget is being squeezed so hard that the poor, sick and disabled are actually dying as a result – from lack of food, lack of heat, lack of medical care and lack of hope. Never forget that this man pursues economic policies that kill his own fellow citizens.

Now we hear that his government has been deliberately misusing evidence and statistics to misrepresent the plight of the poor, according to a report by a group of British churches. Evidence has been skewed to put the blame for poverty at the door of the poor themselves.

Honest? Trustworthy? Fit to govern?

Again, there are lessons for Labour. Ed Miliband’s party must realise that the Conservative Party’s attitude to social security – and New Labour’s before it – is completely at odds with public feeling and must be scrapped in its entirety. The social security system needs an overhaul with new values placed at its centre – values of fairness to the claimant, whether they are jobless, sick, disabled, or simply poor. It is the need of the person applying for help that must define what they receive – not a grubby money-grabbing plot. Above all, Labour must accept that any policy that leads to a claimant’s untimely death must be halted at once.

The fact that the Coalition has allowed these deaths to continue – and in fact increased their frequency – should be a matter for criminal proceedings in the future.

The question of how we pay for social security leads us back to the nation’s economy. Labour must come forward with a robust plan for investment in the nation because – if done right – this will pay for itself. Conservatives run down the idea of borrowing to invest, even though this is how Tory entrepreneurs made their own fortunes, but it is the only way forward. The economics of the Coalition can only lead to ruin.

So: Reform of the economy; reform of social security; reform of the health service; reform of our relationship with the European Union; and trustworthiness, to keep its promises. That’s how Labour will win the next election.

Let’s face it; there’s no opposition from the other main parties.

The only way Labour can lose is if it doesn’t see what’s staring it in the face.

Miliband’s plan: Return of the 10p tax rate

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Labour’s tax revelation: Ed Miliband announces his plan to reinstate the 10p lower tax band, as broadcast by the BBC.

What’s David Cameron going to whinge about now?

The comedy Prime Minister stuffed his foot deep into his own mouth during his questions on Wednesday, when he said he was not interested in Ed Miliband’s speech today because it would not contain any major policy messages.

Instead, Miliband not only took away one of Cameron’s favourite crutches – he has loved attacking Labour for removing the 10p tax rate (which he knew perfectly well was only intended to be temporary at the time) – but also spirited away one of Nick Clegg’s policy plans: Reintroduce the 10p rate and use a tax on mansions worth more than £2 million to pay for it.

That’s a brilliant strategy for the current situation. It answers Cameron’s criticism and it makes a clear message about Clegg – that Labour will do what he and his Liberal Democrats could not.

And it creates a clear priority divide between Labour and the Conservatives, who will introduce in a tax cut for people in the highest tax band in April.

Around 25 million people will benefit from this change, compared with 13,000 who will make money from the Tory tax plan.

His comment that the recovery will be created by the many – not just the few at the top – meshes very well with the opinion put forward on this blog yesterday about the Bank of England’s optimistic view of the future of the economy. The bank’s view, put forward by Sir Mervyn King, was that an improved manufacturing sector would lift us up – but this would only improve matters for people at the top of the economic ladder; Miliband’s plan brings rewards to those at the bottom.

And we know, don’t we, that people at the lower end of the pay scale keep the money circulating. That’s how the economy grows – keeping the money moving.

Mr Miliband also announced several other plans that would have important implications for working people and those who are on low incomes. These are to:

•Break the stranglehold of the big six energy suppliers.

•Stop the train company price rip-offs on the most popular routes.

•Introduce new rules to stop unfair bank charges.

•And cap interest on payday loans.

And a policy on tuition fees is promised before the next election; Miliband says he can see how off-putting they are to people who would otherwise put themselves through university.

These are all sensible measures. We pay too much for our energy; we pay too much on rail travel; the banks rip us off; and payday loans are nothing but a scam anyway – one that too many people are forced to use because the current system ensures they don’t earn enough to pay their way.

In the Q&A session, Miliband said he would tax bankers’ bonuses to fund a work programme for unemployed young people – and he thinks businesses would back this. It’s a plan that might work, as the economic benefit from getting people back into work – the expansion that would result – could offset the losses the banks would suffer. So everyone could win.

The urgent issue that hasn’t been covered today is that of disability benefits. Vox Political would like to see Labour change its approach to follow that outlined in the House of Lords this week: That the disability benefit system must be rethought, starting with the needs of disabled people, not with a plan for a budget cut.

As matters stood at the start of the current government, only 0.4 per cent of disability benefit claimants were believed to be claiming fraudulently. That’s one in every 250 claimants – a very small amount. The current bid to clear as many people off the books as possible – no matter how ill they may be – is an abomination that cannot be allowed to pass.

It seems David Cameron, campaigning in Eastleigh, has been asked for his opinion on the main announcement. He said it “looks like it has been cobbled together overnight”.

That’s a weak response from the man of whom Mr Miliband said: “Have you ever seen a more incompetent, hopeless, out of touch, u-turning, pledge-breaking, make it up as you go along, back of the envelope, miserable shower than this Prime Minister and this government?”

Expect Labour’s poll ratings to enjoy a significant bounce.