The State of Osborne: a visitor’s guide

Tags

allowance, Anthony Nicholas, austerity, autumn statement, avoid, bedroom tax, benefit cap, book, breathtaking complacency, budget, building, cap, Coalition, Conservative, debt, deficit, Democrat, Department, double-dip, DWP, economy, education, election, employer, employment, error, evade, evasion, fraud, Free, fuel duty, full-time, Funding For Lending, George Osborne, Gideon, help to buy, holiday, house, Huffington Post, ill, Joanne Wood, jobs tax, Jobseeker's Allowance, JSA, keynes, KPMG, Labour, Lib Dem, Liberal, living standards, loan, Mark Ferguson, married, marry, mental, Michael Gove, Mike Sivier, mikesivier, national insurance, OBR, office, Owen Jones, part-time, pay, pensioner, Pensions, recession, responsibility, Robin Stacey, sanction, school meal, self-employed, sell, sick, spending, stagnate, stagnation, student, surplus, tax, The Guardian, Tom Clark, Tories, Tory, Twitter, under occupation charge, VAT, Vox Political, wage, welfare, Will Moriarty, work, zero hours

A moment of crisis for David Cameron as he realises it is unlikely that George Osborne has the faintest idea what the Autumn Statement means.

If anybody else had prattled on for 50 minutes while hardly uttering a single sensible word, they would have been consigned to a mental hospital forthwith.

But this is Coalition Britain, and the speaker was George Osborne, the man who likes to tell us all that he is in charge of the nation’s finances. Thanks to his government’s Department for Work and Pensions, nobody is allowed to have mental illnesses anymore; after this speech, it seems likely we all have an idea about the reason for that.

A 50-minute speech is a lot of verbiage, and it is certain that worthier journalists across Britain – if not the world – have already analysed it to exhaustion. Allow me to let you into a secret:

They’re probably trying too hard.

Most of the speech was about putting Labour down. The Opposition has made all the headway over the past few weeks, and we all knew Osborne was under orders to change the mood music of the nation in time for Christmas.

Did he manage it? Not really. His speeches always come across as strained events, where he’s making an effort to be clever without ever achieving it. As a result, the message gets lost. We can therefore discount the Labour-bashing.

That leaves us with what he actually said. Even here, his meaning was at times opaque. What follows is an attempt to provide a handy guide to George-speak, for anyone unfortunate enough to have heard him yesterday.

Osborne: “We have held our nerve while those who predicted there would be no growth until we turned the spending taps back on have been proved comprehensively wrong.”/Meaning: “I am lying. Austerity failed miserably and the economy flatlined. A few months ago I realised that we would have nothing to show at election time so I turned the spending taps back on, with Help To Buy and Funding For Lending. I know that these are exactly the sort of Keynesian economic levers that I preached against for three years but I’m hoping that nobody noticed.”

The hard work of the British people is paying off, and we will not squander their efforts./Osborne appears to be celebrating his three years of stagnation. He inherited growth and decided to trash it. (MagsNews on Twitter)

There was no double-dip recession./“Phew! Lucky escape there!”

At the time of the Budget in March, the Office of Budget Responsibility forecast that growth this year would be 0.6 per cent. Today, it more than doubles that forecast and the estimate for growth will be 1.4 per cent./“Please God don’t let anybody remember that three years ago, the forecast for this year was 2.9 per cent.”

Today in Britain, employment is at an all-time high… We have the lowest proportion of workless households for 17 years./These jobs have increased the numbers of the working poor. Too few are full-time; too many are part-time, zero-hours or self-employed, serving up no National Insurance contributions from employers, no holiday or sick pay, or making contractors work long hours for less than the minimum wage.

The number of people claiming unemployment benefit has fallen by more than 200,000 in the past six months—the largest such fall for 16 years./“And we have imposed sanctions on more people on Jobseekers’ Allowance than ever before, in order to produce that figure.”

By 2018-19, on this measure, the OBR does not expect a deficit at all. Instead, it expects Britain to run a small surplus. These numbers mean that the Government will meet their fiscal mandate to bring the structural current budget into balance and meet it one year early./Although of course the books were initially supposed to be balanced by 2015. (Huffington Post live blog)

This year, we will borrow £111 billion, which is £9 billion less than was feared in March./…and £41 billion more than forecast in 2010.

We will cap overall welfare spending./But this will not include the state pension (half the social security budget) or the most cyclical jobseeker benefits./”A living wage would mean less dosh on in-work benefits; letting councils build would mean less subsidies for private landlords.” (Owen Jones on Twitter)

Pensioners will be more than £800 better off every year./But as usual he’s ignoring the VAT elephant in the room. (Mark Ferguson on Twitter)

We think that a fair principle is that, as now, people should expect to spend up to a third of their adult lives in retirement. Based on the latest life expectancy figures, applying that principle would mean an increase in the state pension age to 68 in the mid-2030s and to 69 in the late 2040s./But life expectancy depends on where you live and how much money you have, meaning the poor continue to pay more towards the pensions of the rich./”Current pensioners better off – future pensioners paying for it. What was that about “making our kids pay for current spending” George?” (Mark Ferguson of LabourList on Twitter)

Most wealthy people pay their taxes and make a huge contribution to funding our public services; the latest figures show that 30 per cent of all income tax is paid by just one per cent of taxpayers./Estimates of the amount of tax that is not collected range between £25-£120 billion per year and it is not the poor who aren’t paying up.

This year the rich pay a greater share of the nation’s income taxes than was the case in any year under the last Labour Government./Because they now have more income. Simple really. (Tom Clark of The Guardian, on Twitter)

Today we set out in detail the largest package of measures to tackle tax avoidance, tax evasion, fraud and error so far this Parliament. Together it will raise over £9 billion over the next five years./Including capital gains tax for foreign investors on sales of UK property, which has nothing to do with tax avoidance/evasion, fraud or error.

We must confront this simple truth: if we want more people to own a home, we have to build more homes… The latest survey data showed residential construction growing at its fastest rate for a decade./The rate of house building is at its lowest peacetime level since the 1920s

This autumn statement has found the financial resources to fund the expansion of free school meals to all school children in reception, year 1 and year 2, announced by the Deputy Prime Minister and supported by me./On Wednesday, the Lib Dems and Michael Gove’s education department argued over who had to pay for it.

Extra funding will be provided to science, technology, and engineering courses [in universities]. The new loans will be financed by selling the old student loan book, allowing thousands more to achieve their potential./And pushing thousands into the hands of debt collectors.

The best way to help business is by lowering the burden of tax. KPMG’s report last week confirmed for the second year running that Britain has the most competitive business tax system in the world./KPMG would know – it writes the tax system and also runs some of the larger tax avoidance schemes.

From April 2015 we will introduce a new transferable tax allowance for married couples… Four million families will benefit, many of them among the poorest working families in our country./Osborne says the Tories are backing British Families – but only ones who are married it seems. (Mark Ferguson on Twitter)/While the new tax arrangements bribe families to marry, the benefit cap will bribe big families to split up. (Tom Clark on Twitter)

We are all in this together./The biggest lie of this Parliament.

We are also helping families with their energy bills./Commence the cutting of the “green crap”. This from the “Greenest government ever”. (Mark Ferguson on Twitter)

Next year’s fuel duty rise will be cancelled./This is a cut in a tax that was never imposed in the first place.

We are going to abolish the jobs tax on young people under the age of 21. Employer national insurance contributions will be removed altogether on a million and a half jobs for young people./Young people will therefore have less chance to get contribution-based benefit. National Insurance assures people their pension contributions – except when it isn’t paid. So they will have no contributions to show for any years they worked before 21 and will have to work until their late 60s.

The cost for a business of employing a young person on a salary of £12,000 will fall by over £500./This is a bonus for businesses, not employees.

“Jobs tax” – it’s ludicrous, isn’t it? National Insurance has been a respected part of British life for more than 100 years but Osborne, living as he does in a mythical Victorian-era golden age that never actually existed, thinks it is a “jobs tax”. Either that or he’s still bruised by the fact that Labour’s labelling of the under-occupation charge as a Bedroom Tax caught on with the public.

Shadow Chancellor Ed Balls got on his feet and immediately attacked Osborne’s “breathtaking complacency” for denying the drop in living standards faced by everyone in the country, with families already £1,600 per year worse off. Osborne laughed. He thought that was funny.

The Shadow Chancellor pointed out that we are enduring the slowest recovery in a century, and that average real wages will have dropped by 5.8 per cent by the end of the Parliament (except for fatcat business bosses).

He was having a hard time getting his points across, however, because Tory MPs were heckling him very loudly. Owen Jones tweeted, appositely, “Do the Tories think that a bunch of braying MPs dripping with privilege, while ordinary people’s living standards crash, is good TV?”

Maybe they did. Maybe they thought they had the public on their side.

Let’s have a look at a few comments from the public – courtesy of the Huffington Post:

“Planning to kill more people, George?” (Robin Stacey)

“Spend more you wet lipped monkey.” (Will Moriarty)

“No one has an ounce of faith in anything you say, you parasitic pool of curdled warthog’s puke.” (Anthony Nicholas)

And finally: “Hope you end the speech with your resignation x” (Joanne Wood – and yes, she did mean to end with a kiss).

What a shame Osborne did not follow her advice.

 

Vox Political is funded entirely by donations and book sales.
You can make a one-off donation here:

Alternatively, you can buy the first Vox Political book,
Strong Words and Hard Times
in either print or eBook format here:

Bedroom Tax Tories: What they said and why they were wrong

Tags

adapt, Anne Main, banker, bankster, bedroom tax, build, Conservative, council tax reduction scheme, debate, deficit, disability, discretionary housing payment, Eric Pickles, fairies, financial crisis, Heather Wheeler, house, housing benefit, Iain Duncan Smith, IDS, Katy Clark, Labour, Matt Hancock, Mike Sivier, mikesivier, minimum wage, modern, opposition day, overcrowd, Parliament, Philip Davies, Poll Tax, private sector, Rachel Reeves, rent, returned to unit, Roger Williams, RTU, save, saving, spare room subsidy, Stephen Twigg, Steve Webb, surplus, tax, threshold, Tobias Ellwood, Tories, Tory, under occupation charge, unicorn, Vox Political

Demonstrating for justice: Campaigners against the Bedroom Tax gathered outside Parliament while MPs debated it inside.

“I’m amazed Labour have chosen to spend their allotted day in Parliament arguing for more unfunded spending on housing benefit.” That’s what Matt Hancock, Conservative MP for West Sussex, had to say about the Opposition Day debate on the Bedroom Tax in the House of Commons on November 12.

Hancock is, it seems, author of a book entitled Masters of Nothing, which sums up his understanding of the situation rather well. He clearly has not mastered the fact that the State Under-Occupation Charge will not save money. He has not mastered the fact that emptying dwellings of their current owners will not make them available to new familes as these people are afraid they will themselves be tipped onto the street when their circumstances change – instead the premises will be left empty, at huge cost to social landlords; and he has not mastered the fact that anyone evicted because of the tax will become a burden on local authorities, who have a duty to rehouse them in bed and breakfast accommodation, even though the money provided to them for this purpose by the government is ludicrously inadequate to the task.

Hancock is not alone in having misconceptions about the Bedroom Tax. Most, if not all, of the Conservatives who spoke during the debate uttered howlers – and the purpose of this article is to name them and explain why they should be ashamed of their words.

Please take the opportunity, Dear Reader, to look for your own MP in the catalogue of calamity that follows, then use it to attack them in their own consituency. Let’s make them realise that actions have consequences.

If you don’t have a Tory MP, feel free to use what follows in order to make sure you never have to put up with one.

We begin with Tobias Ellwood (Bournemouth East) who asked of Rachel Reeves: “What does she say to the almost 400,000 families who are living in overcrowded situations when they look over their shoulders at the almost one million spare bedrooms in Britain?”

The Shadow Work and Pensions Secretary responded without hesitation: “I say that instead of presiding over the lowest rate of house building since the 1920s, this Government should get on and build some houses.”

This is the fact of the matter. Conservatives throughout the debate berated Labour for building too little social housing, while ignoring their own abysmal record. In the 2012-13 financial year, only 135, 117 new homes were completed – the lowest number on the books.

The Minister of State, Steve Webb, came back to this point later, saying: “Who was doing the house building for 13 years?” Well, we all know who hasn’t been doing it for the last three.

Mr Ellwood said the Tax was brought in because the cost of housing benefit was rising alarmingly: “After 13 years of Labour the cost of housing benefit doubled to £21 billion. That is unacceptable. The cost to taxpayers was £900 per household. The system was getting out of control.” His failure is that he refused to accept the explanation offered by Labour’s Katy Clark – that this was due to the rising cost of rent in the private sector (private rents have indeed been rising massively and the government refuses to take action because this would interfere with the market. Bizarrely, the Conservative-led Coalition seems to believe it is acceptable to pay huge gobs of housing benefit to private landlords – who make unreasonable demands – and then blame social renting tenants for it). He also, by inference, rejected the evidence that the Bedroom Tax will not save any money.

Mr Ellwood also referred to the deficit run by the Labour government of 1997-2010. He said: “Labour lived beyond its means. In 2002-03, it spent £26 billion beyond its means. Four years later that rose to £33 billion. In its final year of office, the deficit rose to £156 billion. That always accumulates.”

This is disingenuous. As he must know, not only did Labour run a lower deficit than the Conservative governments of both Thatcher and Major (average 41 per cent of gross domestic product) from 1997 to 2007, it also made a surplus in the 2000-2001 financial year – something that the previous Conservative governments never did. This means Labour actually paid off some of the debts that had been accumulating. With that pedigree, even the 43 per cent deficit of 2008 looks respectable. The higher deficits of 2009 and 2010 were entirely caused by the bankster-instigated financial crisis, when the actions taken by Labour were entirely supported by the Conservative Party.

He went on to condemn Labour for voting against £83 billion of welfare savings; if the reasoning for them was as shaky as that for the Bedroom Tax (and it was; see previous VP articles) then Labour was quite right to do so!

It should be noted that the Secretary of State for Work and Pensions, Iain Duncan Smith, was not present at the debate. RTU (as we like to call him) was woofing it up in Paris, rather than accounting for his misbehaviour to the taxpayer.

Mrs Anne Main (St Albans) echoed a comment by Mr Webb, but did it in such an inept way that we’ll look at her words rather than his. Following Labour’s Stephen Twigg, she referred to the too-low allocation of Discretionary Housing Payment to families having to cope with the Bedroom Tax: “Perhaps he would like to speak to his Labour-run Liverpool council and ask why, when it received £892,000 in discretionary housing payments last year, it actually sent back £337,000.”

Mr Twigg put her straight: “Does she accept that the figures that she has given are from before the bedroom tax was introduced? This year, Liverpool city council will certainly spend the entire discretionary housing pot.”

His words echoed fellow Labour MP Lucy Powell, who had previously berated Mr Webb: “The Minister incorrectly gave figures for last year—the bedroom tax was introduced only in April. I was talking about money that will come back this year. I can guarantee that the Minister will not be getting any money back from Manchester this year — the year of the bedroom tax.”

Referring to the 400,000 disabled people affected by the Bedroom Tax, Mrs Reeves said 100,000 disabled people live in properties specially adapted for their disability, but the average grant issued by local authorities for adaptations to homes [when they are forced to move out by the Bedroom Tax] stands at £6,000. The total cost of doing the adaptations all over again could run into tens of millions of pounds.

At this moment, Heather Wheeler (South Derbyshire), said while seated: “They’re exempt.”

The response: “The hon. Lady said from a sedentary position that disabled people are exempt, but she would not say it when she was on her feet because she knows it is not true.” In Vox Political‘s home constituency, at least one disabled person has already been evicted because of the Bedroom Tax.

Philip Davies (also known as ‘Stupid of Shipley’) weighed in with a shocking error, in an attempt to attack his local housing association and its director, a Labour MP: “Does the Minister agree that the spare room subsidy is one reason why we do not have the right mix of housing? Social housing providers could build houses as big as they wanted, knowing that the Government would cover the full bill irrespectively. In that respect, does he deplore the social housing provider in my area, of which a Labour MP is a director? It complains on the one hand that it has too many three-bedroom houses—”

That’s as far as he got, and just as well. Let’s go through this one more time: The ‘spare room subsidy’ is a fiction. It never existed and therefore could never have been abolished by the Conservative-led Coalition government. Being entirely make-believe, it could never have affected the decisions of social housing providers. This is just one of the many reasons why Mr Davies is rightly considered to be one of the biggest twits in the Tory Party (among hefty competition). Another might be his claim that disabled people should work for less than the minimum wage.

David TC Davies (Monmouth) complained: “Opposition Members… do not want to talk about the fact that they introduced a measure like this for the private sector.”

He was among many Tories who complained about this apparent double-standard. Labour members reminded them that the Bedroom Tax is retrospective (affecting people currently in social housing) while the private-sector measure was for new tenants only. One may also ask why, if these Conservatives were so disturbed by the apparent discrepancy, they were not calling for this earlier measure to be scrapped as well.

George Hollingbery (Meon Valley) said: “We need to pose ourselves a question: what is dealing with the spare room subsidy about? Is it about reducing the housing benefit bill? Yes, of course it is. The Government propose a £500 million saving, which is important.”

It is important, because Conservatives seemed confused throughout the debate about whether they were trying to sort out overcrowding by putting people into appropriate accommodation, or trying to save money. The two are mutually exclusive. The only way to make money on the policy is for people to remain locked in housing that, thanks to the Bedroom Tax, is now too expensive for them – but this cannot last because they will soon be evicted for non-payment of rent. Moving people around, so that nobody is under-occupying, will result in a higher housing benefit bill because more people will be claiming – the original tenants in their new properties (which, if they are run by private landlords, will be more expensive) and the new tenants who will be occupying to the limit of a property’s capability and therefore may claim the full amount of housing benefit. Either way, Mr Hollingberry’s claim of a £500 million saving is pie-in-the-sky.

Margot James (Stourbridge) made a proper fool of herself. She said: “The Opposition… want to position the end of the subsidy and the creation of a level playing field between all recipients of social housing support as a modern day poll tax.” This is the least of her mistakes as some Labour members may have suggested such a thing; in fact it is Eric Pickles’ Council Tax Reduction Scheme that is the modern-day Poll Tax, because every household must now towards it.

Margot James went on to deny that the Bedroom Tax is a tax, saying: “A tax is a government levy on somebody’s income, whereas we are clearly talking about reducing a subsidy.” This is wrong on two counts. Firstly, there has been no subsidy to reduce – unless she was referring to housing benefit in its entirety. The spare room subsidy is, as already mentioned, as mythical as the “unicorns and fairies” to which Anne Main referred when she tried to dismiss the existence of the under-occupation charge as a tax on bedrooms. Both ladies are wrong, because a tax may also be defined as a government levy on property owned or used by a citizen (such as, say, a bedroom). So – not quite as mythical as unicorns and fairies. One has to wonder why Mrs Main mentioned these, as she has clearly been away with the fairies herself.

Kwasi Kwarteng (Spelthorne) breezed in from another committee to provide the benefit of his own ignorance. He asked: “Is it fair that someone on a low income who is in privately rented accommodation should pay taxes in order to subsidise someone else’s spare room? Is it fair to raise taxation from low-paid workers to subsidise other people’s accommodation?”

The answer, of course, is yes. It is fair. In fact, it is a principle of our system of taxation. Everybody pays into the national treasury, in order to allow the state to provide services – such as housing – for those in need. This may be a detail that current Tories have missed, considering the government’s vigorous attempts to write the highest earners out of taxation altogether. If he wanted to help low-waged people in private rented housing, the answer to that is also simple: cap their rents.

And doesn’t he know that the very low-paid have been lifted out of taxation by his own government, as the Coalition has been raising the threshold for payment of income tax every year, aiming to reach a target of £10,000 income per annum by 2015.

At the end of the day, the motion to scrap the Bedroom Tax was lost by 26 votes. Some have already said that Labour could have won it if all members had been present, but that was never really on the cards; the government has the numbers, even if some Liberal Democrats (like VP‘s own MP, Roger Williams) abstained.

So what are we to make of it all? Simply this: The Conservatives do not have a credible narrative to describe what the Bedroom Tax is about. It doesn’t save money; it won’t put people into appropriate accommodation; and it certainly won’t cut homelessness!

Work out what it’s really about, and you will understand why they are so desperate to keep it.

Poll result reveals DWP doublespeak on the Bedroom Tax

Tags

accommodation, advert, bedroom tax, Coalition, Conservative, Democrat, Department, doublespeak, DWP, esther mcvey, government, house, housing, housing benefit, Iain Duncan Smith, Ipsos Mori, job, Job Centre, Lib Dem, Liberal, Mike Sivier, mikesivier, overcrowd, Pensions, poll, social, social housing, spare room subsidy, state, Tories, Tory, under occupation, under occupation charge, Vox Political, work

The Department for Work and Pensions is heralding the result of a new poll as proof that a large majority of people support its controversial Bedroom Tax policy – in fact the findings prove nothing of the sort.

Headlined (incorrectly) ‘Poll shows support for removal of spare room subsidy’ – there is no such thing as a spare room subsidy so it cannot be removed – yesterday’s press release relies on some not-so-subtle wordplay and the gullibility of the reader to make its case.

If you want to find out how many people supported the government’s policy, you’ll have to look somewhere else because it is not directly identified anywhere in the article.

“New independent research shows there is strong public support for reducing under-occupation and overcrowding in social housing,” it begins – and this is fair enough.

People do indeed want to reduce under-occupation in social housing – but we have seen, time and time again, that people think there must be adequate social housing available for people who want, or need, to move. This is not what the Conservative and Liberal Democrat government are offering.

Instead, people are being told they can either move into smaller, privately-rented accommodation that will create more expense for the government, or if this is unavailable, pay the Bedroom Tax at 14 per cent of their eligible rent for one room and 25 per cent for two or more. Whatever they do, they end up having to pay more. That is not reasonable.

“In a poll [of 2,021 people] conducted by Ipsos MORI, 78% of respondents said they thought it was important to tackle the problem, which has led to nearly one-third of social housing tenants who receive Housing Benefit living in homes that are too big for their needs,” the article continues.

What problem is this, then? The problem of people occupying social rented properties that are too large for them, as the ConDems want you to believe? Or the problem of successive governments failing to build social housing that is adequate for the needs of the population? The latter seems more likely, don’t you think?

None of the information around that 78 per cent figure suggests that 1,576 people support the Bedroom Tax. I happen to believe it is important to tackle the bottleneck, in order to relieve the overcrowding issue. The Bedroom Tax won’t do that, though. It will just take money from poor people.

Was support for the Bedroom Tax indicated anywhere in these results? No. The closest we get is: “The polling also found that 54% agreed that it is fair that people of working age, who live in social housing, should receive less Housing Benefit if they have more bedrooms than they need.” Even this does not suggest that those questioned agreed with the amount the government is taking from hardworking social tenants.

Curiously, the same proportion of those polled – 54 per cent – said they believed “the coalition government’s removal of the spare room subsidy policy will encourage those receiving less housing benefit to improve their personal situation by, for example, finding work.”

There are a couple of points to make here. Firstly – there is no policy to remove the spare room subsidy because, as previously mentioned, the spare room subsidy has never existed. Secondly, the idea that people can find work (or find better-paying work) is a bad joke.

Only yesterday, a staffer at my local Job Centre was heard admitting that their office had received no new job advertisements in several weeks, and there is no evidence that this is a unique case. It is unrealistic to suggest this as a reasonable way out.

The fact that both these questions received 54 per cent support leads one to question how many of the respondents were affected by the Tax. My guess would be 46 per cent or less. The other 46 per cent, of course.

DWP ministerial rentamouth Esther McVey was on hand to provide the commentary (Iain Duncan Smith is still in hiding, one presumes). She said: “This shows that the public agree that action was needed to tackle overcrowding and to make better use of our housing stock.” Except, as already pointed out, it doesn’t show that the public agree with the government.

She added: “We have seen our Housing Benefit bill exceed £24 billion – an increase of 50% in just 10 years – and this had to be brought under control.”

The Bedroom Tax will do nothing in this respect – in fact, the bill may increase (people moving into private rented property would receive more benefit, and people who have been evicted because they can’t pay their bills after the Tax was imposed will be a burden on councils, who will have to put them up in more expensive B&B accommodation).

Also, increasing numbers of working people are being forced to claim housing benefit because companies are making sure their wages are too low to provide a decent living. Almost a million working people were claiming housing benefit in May this year, and that figure seems sure to have been exceeded by the time the next set of statistics is released on November 13 (Wednesday).

Apparently it is bad for unemployed people to claim the benefits they deserve, but perfectly fine for companies to have the lousy wages they pay topped up at the taxpayers’ expense.

That’s government doublespeak for you!

‘Slimy’ minister talks up unfunded housing scheme while 50,000 face eviction

Tags

AAA, alistair darling, bedroom tax, bubble, building, Channel 4, Coalition, Conservative, credit rating, crisis, David Cameron, debt, deficit, equity loan scheme, evict, George Osborne, government, help to buy, housing, interest rate, Johnny Void, Keighley, Kris Hopkins, Michael Meacher, Mike Sivier, mikesivier, mortgage guarantee, Nadine Dorries, nastiest, nasty, Northampton, people, Philip Davies, politics, price, slimiest, slimy, Tories, Tory, under occupation charge, unfunded, Vox Political

‘Slimy’ Tory mouthpiece? Kris Hopkins (left), the Coalition’s new housing minister, takes tea with David Cameron on a Northampton housing estate while talking a lot of nonsense about Help to Buy. [Picture: WPA Pool/Getty Images Europe]

One of Parliament’s “slimiest, nastiest MPs” has got stuck into his new job, putting out a press release on how the hideously ill-judged ‘Help to Buy’ housing scheme is “surging ahead”.

Kris Hopkins, the Conservative MP for Keighley whose only previous claims to fame were allegations that “gangs of Muslim men were going around raping white kids” (thanks to Johnny Void for that one) and a Twitter spat with the odious Philip Davies, said the equity loan scheme had driven up the rate of house building and captured the public imagination with more than 15,000 reservations for new-build homes in its first six months.

Reality check: House building is at its lowest level since the 1920s. In the 2012-13 financial year, only 135,117 new homes were completed – the lowest number on record.

Earlier this year, Hopkins called for Conservatives to unite behind David Cameron – to which Nadine Dorries responded, “pass the sick bag”. Yesterday, he at least was united behind Cameron – as they toured a Northampton housing development.

According to the press release, he said government action to restore confidence to the housing market was working, with over a third of a million new homes built over the last 3 years, including 150,000 affordable homes.

Reality check: That is a lower number than any period on record prior to the current Coalition government. It is not an achievement. It is a disaster.

Under the equity loan scheme, buyers can get mortgages on new build homes with a five per cent deposit, with the rest provided by an equity loan from the government of up to 20 per cent on properties with a value of £600,000 or less.

Yesterday (October 8), Cameron and his Chancellor, George Osborne, launched the second part of Help to Buy – the mortgage guarantee – which will also be available on existing properties worth £600,000 or less. Lenders will be able to offer a 95 per cent loan-to-value mortgage, made possible by a government guarantee to the lender of up to 15 per cent of the value of the property.

Reality check: In English, this means the taxpayer is underwriting people’s mortgages. Osborne reckons he has put aside £12 billion for this part of the scheme but – as former Chancellor Alistair Darling recently noted  – the source is unidentified. “Strange that when Labour makes promises, the Tories claim it will mean more borrowing, yet it’s fine for them to make unfunded promises,” Mr Darling wrote.

Back to the press release: “Housebuilding is growing at its fastest rate for 10 years,” it says.

Reality check: The Channel 4 article, quoted above, warns us to “take the proclamations we are getting from the government about high rates of growth in housebuilding with a hefty pinch of salt. Housebuilding completions are starting from modern record lows; the rates of growth are bound to be high.”

What does Kris Hopkins have to say about this? Not a lot, in fact. He blathers that the equity loan has “captured the imagination of the public and is boosting the supply of new homes across the country”.

Reality check: Back to Channel 4 – “The levels… show that something went wrong in 12/13. Turning the corner means going from abysmal to terrible.”

“Our policies on housing are working,” said Hopkins in the press release. “Housebuilding is growing at its fastest rate for 10 years, and the tough decisions we’ve taken to tackle the deficit have kept interest rates low and are now delivering real help to hardworking people.”

Reality check: We’ve already covered the speed at which house building is growing; he should not be pretending this is a huge success when the number of new houses being built has fallen to a record low. As for the policy on the deficit keeping interest rates low – Vox Political blew that out of the water months ago. For clarity: A government can always service its debt, if that debt is in its own currency. Our debt is in UK pounds and we can always service it. Our creditors know that, so they remain happy to continue financing it. Otherwise, with Osborne borrowing 75 per cent more than he said he would in 2010, and with the UK’s ‘AAA’ credit rating gone in a puff of agency doubt earlier this year, Osborne would have been up a certain creek without an economic lever (to mix a metaphor or two).

“I’m delighted we’ve launched the second part of Help to Buy, the mortgage guarantee, which will strengthen the package of measures that have already done so much to restore confidence in the housing market,” Hopkins concluded.

Final reality check: Michael Meacher is one of many who believe that ‘Help to Buy’ will do nothing more than create another housing price ‘bubble’, most likely leading to another debt crisis. “Even [George Osborne’s] Tory supporters believe [this] will throw oil on the fire of the already overheated surge in house prices,” he wrote.

Meanwhile, at the other end of Britain’s housing market, 50,000 people are facing eviction because of the Bedroom Tax.

To the devil with the details – axing the bedroom tax is the right decision

Tags

accommodation, agreement, axe, BBC, bedroom tax, Coalition, Conservative, Democrat, Department, DWP, Ed Miliband, hedge fund, housing benefit, international, investigator, Labour, legal, Lib Dem, Liberal, Matthew Hancock, Mike Sivier, mikesivier, Pensions, private, rent, repeal, reverse, Sajid Javid, scrap, share, shares for rights, social, spare room subsidy, SPeye, tax, taxpayer, The Guardian, Tories, Tory, un, under occupation charge, unfair, united nations, Vox Political, work

Costed and credible: Ed Miliband announcing Labour’s plan to end the bedroom tax. [Picture: BBC]

The SPeye blog makes a good point.

Labour doesn’t need to justify scrapping the bedroom tax beyond stating the fact that it is an unjust measure designed to inflict misery upon the lowest-earning citizens of the UK while conferring no discernible benefit on the state.

Therefore Ed Miliband’s insistence on pandering to the Coa-lamity government’s narrative by trying to say where he would find the money to make the move possible may be seen as a mistake; there is no evidence that the bedroom tax has saved a single penny and every reason to believe that it will be a greater burden on the taxpayer in the long run.

Labour failed to attack the claim that the bedroom tax was saving money and we should question the wisdom of Miliband’s advisors in omitting this detail.

He should have pointed out that the Coalition government’s claim – that the tax negates differences between social rented accommodation and the private sector – is nonsense and we should question the wisdom of Miliband’s advisors in omitting this detail.

And he should have pointed out that the Coalition’s claim – that the bedroom tax and other changes would cut the cost of Housing Benefit by £2 billion – is also nonsense; that bill was £20.8 billion in 2010 when the claim was made so, with the current cost at more than £23 billion, the bill is now £5 billion above the Coalition’s target without showing any signs of coming down. We should question the wisdom of Miliband’s advisors in omitting this detail, also.

Or rather, he should question their wisdom.

There will be a time for that, but this isn’t it.

Those arguments don’t matter right now.

The fact is that he said the bedroom tax is unfair and a Labour government would end it – and he said it after a United Nations investigator made exactly the same claim. Labour has brought itself in line with UN findings and now the Coalition has been cast as a rogue government, acting against legally-binding international agreements which Labour would uphold.

But let’s just have a look at that mistake again. Labour said it would be able to axe the bedroom tax because it would save money by other means – ending a tax break for hedge funds and cutting short the new shares-for-rights scheme currently being thrust at company employees by the Treasury.

These are things that Labour would do anyway. The bedroom tax is just an excuse – in the same way that the Conservatives and the Liberal Democrats put up an excuse for inflicting it on the poor, the sick and the disabled in the first place. It’s basically Miliband and the rest of the Labour Party offering the Conservatives and their little yellow friends a taste of their own medicine.

That gives them credibility.

And, if these measures really can boost public funds by £2 billion, then Labour will have found a way to do what the Coalition could not, because the bedroom tax was always likely to cost more money than it saved, for reasons well-discussed in the past.

Hedge funds are a rich seam of cash, ripe for mining by politicians because they aim to make money whether the market is moving up or down. The means by which they do this are extremely questionable and can artificially engineer collapses in company share prices, so it is right that a punitive tax regime should be imposed upon them.

That means that Labour’s plan really has been costed in a reasonable way. Costed and credible – just as Miliband claimed.

And the Treasury knows it. Look at its response – an unfounded, nonsense claim that Labour would tax pensions and borrow more money to fund the change.

Sajid Javid came out with this rubbish on the BBC’s news website. His credibility is already shaky and his claim has done nothing to improve that situation for him.

Business minister Matthew Hancock also got in the ring, but flailed wildly around with another nonsense claim that ending the bedroom tax would lead to higher taxes and higher mortgage rates.

He doesn’t matter. Javid doesn’t matter. A Department for Work and Pensions spokeswoman said something as well, but that doesn’t matter either because nobody believes a single word those people say.

The Guardian is currently running a poll asking members of the public to vote on whether the bedroom tax should be scrapped. A massive 91 per cent of voters want rid of it.

Labour has promised to get rid of it.

That is all that matters.

Nick Clegg is in ‘Bedroom Tax’ denial – how does he sleep at night?

Tags

accommodation, adaptation, authorities, authority, bedroom tax, benefit, benefits, build, carer, Coalition, Conservative, cost of living, council, Democrat, Department for Work and Pensions, DHP, disability, Disability Living Allowance, disabled, discretionary housing payment, DLA, Don McLure, Durham County Council, DWP, employer, Employment and Support Allowance, ESA, evict, Facebook, False Economy, food, government, greed, health, heat, housing benefit, Incapacity, Incapacity Benefit, Independent, Lib Dem, Liberal, local, low, Mike Sivier, mikesivier, Nick Clegg, Northern Echo, people, policy, politics, repeal, resources director, Shirley Nott, Shirley Williams, sick, social cleansing, social security, spare room subsidy, tax, Tories, Tory, under occupation charge, unemployment, Vox Political, wage, welfare

The body language says it all: Nick Clegg appears to goose-step off the stage after his conference speech on Wednesday, Nazi-saluting his fellow party members.

It seems this blog’s prediction that the Liberal Democrat leader would ignore the wishes of his party in favour of cosying up to the Tories has been proved accurate.

The Northern Echo has reported that Clegg is refusing to do anything about the so-called ‘under-occupation charge’, even though it is now his party’s policy to oppose it and demand its repeal.

Instead he has blamed local authorities for any problems suffered by the tax’s victims. He told the Echo that councils were failing to spend – or even returning – Discretionary Housing Payment cash which the government has handed out to them as aid for people falling into rent arrears.

He was lying, of course. It seems unlikely that a falsehood of this magnitude can be ascribed to poor advice.

The example used by the newspaper was that of Durham County Council, which received £883,000 from the government to hand out as DHPs – a sum which the council’s resources director, Don McLure, said would last just eight weeks.

In total, councils have been given £150 million to hand out, which may seem a large amount – but is in fact dwarfed by the demand.

Clegg’s rationale for his claim was that several councils had returned some of their DHP allocation at the end of the last financial year – but this was before the bedroom tax had been imposed and so the claim means nothing – and he must know this.

Excuses for the bedroom tax are flying thick and fast, after research by the Independent and the campaign group False Economy proved that 50,000 families are in danger of eviction because of it.

On the BBC’s Question Time, Shirley Williams claimed that the tax had created problems because suitable smaller accommodation had not been built in readiness for the demand it caused. This is nonsense. If there was already demand for accommodation – and we must assume so, because this is the reason the Conservatives have spent so long bleating about families on waiting lists who need accommodation that the tax’s victims are, allegedly, blocking – then why didn’t the government just get on and build it?

The tax was really brought in for several reasons: It is partly a reaction against the increase in the Housing Benefit bill to accommodate people with jobs whose wages are below their cost of living – this is due to greed on the part of employers; it is partly intended to clear housing – not for people on any waiting list but as a form of social cleansing, getting the riff-raff out of attractive parts of our towns and cities; and it is also another attempt to spite people on sickness, incapacity or disability benefits, who must either face the extra cost and inconvenience of removing special adaptations to their houses and reinstalling them elsewhere if they are able to move, or must lose the company of carers who use spare bedrooms when they have to stay over, or must pay the tax and live without food or heat, thereby risking their health.

According to Facebook friend Shirley Nott, the government’s spokespeople are extremely relaxed about this eventuality: “Apparently, there’s no need for alarm. Under no circumstances should anyone assume anything untoward is occurring.

“The reports of 50,000 potential – imminent (initial) evictions are not (“necessarily”) going to be “representative” of a potential situation in the more medium/long term. The ‘rationale’ for this cheery response is (obviously) that the ‘Not a Bedroom Tax’ is only just starting to make its presence felt and so, (of course) people have only just begun “adjusting” to it.”

So their imminent eviction followed, no doubt, by a nice quiet death in a side street is merely “adjusting” to the new system.

Shirley continues: “Government spokespeople… have been at pains to explain – in words of one syllable – that no-one else should worry. It seems possible that some – even most – of those 50,000 mentioned in today’s news might find such an artfully-delivered response to imminent eviction a little difficult to come to terms with – but interested members of the government are very likely to have reasoned that they’ll probably be far too preoccupied with practicalities to make much of it.”

Maybe not – but they can still rely on blogs such as this one to make the point for them.

Please – everyone – feel free to splash this article around wherever you see fit. Use excerpts in letters to your local newspapers, share it with friends who don’t realise the seriousness of the situation – we’ve already had suicides because of this tax, don’t forget…

Make sure it doesn’t go away.

Does anybody believe this Conservative claptrap dressed up as information?

Tags

accommodation, adaptation, Atos, average, bankruptcy, Baroness Thatcher, bedroom, bedroom tax, benefit, benefit cap, benefits, borrowing, Brecon, candidate, carer, censor, child, Chris Davies, Cllr, Coalition, Conservative, councillor, cut, death, debt, deficit, Department for Work and Pensions, disability, disabled, DWP, Ed Miliband, Employment and Support Allowance, ESA, Facebook, fraud, government, health, homeless, housing, housing benefit, Incapacity Benefit, income, insurance, Jobseeker's Allowance, Labour, Liberal, Liberal Democrat, medical, Mike Sivier, mikesivier, Parliament, pension, people, politics, poverty, Radnorshire, Reform, respite, sick, social, social security, spare, spending, tax, taxpayer, Tony Blair, Tories, Tory, under occupation charge, unemployment, unum, Vox Political, WCA, welfare, work, work capability assessment, working family

Tory Parliamentary candidate Chris Davies: In his letter he accuses local Labour members of “acting as disciples of their London hierarchy” – and then regurgitates as much of the drivel handed down to him by his own Westminster masters as he can manage.

Once upon a time, if you found an error in an article, a document or (in my case – I’m going back to when I was very young) a teacher’s work, you were congratulated for finding the “deliberate mistake”. The culprit would say something like: “Well done! I put that in there as a deliberate mistake to see if you were alert enough to find it. You’ve passed the test! As a reward, clean the blackboard.”

I wonder if the same can be said of a letter in the local paper by a Councillor Chris Davies who, we’re told, is the Conservative Parliamentary Candidate for Brecon and Radnorshire. If so, it seems likely that even the doziest student should find at least one, because his screed is riddled with errors.

Last night I spent several hours writing up a response to his nonsense, and I propose to share it with you now. This means the article will be quite long, but never mind. As those of you who keep up to date with current affairs know, it’ll give Facebook something really juicy to censor.

Here’s the letter from Cllr Davies. Spelling mistakes and misuses of apostrophes are all his own work:

“For years people have had difficulty in distinguishing between the policies of political parties, accusing politicians of all being the same and hogging the middle ground.

“I am grateful to the local Labour Party acting as disciples of their London hierarchy for putting clear water between our parties.

“As reported [on April 11], the local Labour councillors are up in arms over the Coalition Government’s Welfare Reforms.

“Yet rather than offering to help people back into work or helping them move into more suitably sized accommodation, all these Labour councillors offer is, ‘Check your exemption status.’

“This is the sad reality of a Labour Party that despises individual responsibility and aspiration, preferring instead to encourage and promote state dependency.

“During the last Labour government, welfare spending rose by 60 per cent.

“Such reckless spending and disregard for taxpayer’s money not surprisingly brought record levels of borrowing and debt which left the UK on the brink of bankruptcy.

“For these Labour councillors to now clearly advocate working the welfare system instead of striving to escape it proves that they still have not learnt their lesson.

“These Labour councillors are also completely out of touch with the public, the majority of whom support the coalition’s welfare reform policies.

“The Welfare State is there as a last resort, a safety net, for those who need it – Not as an alternative to work as it became under Labour.

“Labour has always shown little regard for the hardworking taxpayers’ who pay for the welfare state; those paying for others to stay at home and paying for tenants to live in larger houses than they need. The fact that so many of these hard working taxpayer’s cannot afford a property of any size themselves appears of no concern to Labour.

“Whether you are running your own business, working on the checkout in the local supermarket or working as a farm labourer, the majority of the tax you pay now goes to fund the welfare state.

“No one minds paying for those who truly need support, but as these welfare reforms have already shown, there were many people claiming support that they did not need or were not entitled to.

“Tougher medical tests recently introduced to assess the health of the 2.6 million people claiming incapacity benefit found 800,000 of them were perfectly fit and able to work.

“Another 900,000 dropped their claim to these benefits rather than take the test.

“How can Labour honestly say it is unfair that we are capping benefits at £26,000 a year when that is far more than most workers in Brecon & Radnorshire earn?

“How can Labour continue to support a benefit system that gives workless households a higher income than the majority of working individuals who are paying for the system?

“The system should never have allowed unemployment to become more financially rewarding than working. It is this disincentive to work that has largely caused the welfare problem we are now dealing with.

“All Labour can do is pour scorn on anything the Coalition Government does. What are they offering as an alternative? We are seeing No policies, No ideas, No alternatives.

“To quote Tony Blair recently – “Ed Milliband is in danger of being seen as reducing the Labour party to nothing but a party of protests” – It seems to me that whether in London or locally the Labour Party is already there.”

If I know my readership, you are all shaking your heads in blank astonishment that someone who professes to be a reasonable human being – and has managed to become a county councillor, here in Powys, should come out with such an unremitting stream of dribble.

In response, I wrote the following. Be warned – it doesn’t address every single piece of nonsense in Cllr Davies’ letter. There is a word-limit on letters submitted to the newspaper.

So here’s a game for you: Spot the ‘deliberate’ mistakes in his letter that I haven’t singled out, tell us what they are and why they’re wrong.

Here’s my response:

I read with interest the letter from Cllr Chris Davies, who is keen to put “clear water” between our parties. His letter certainly achieves this, ably clarifying that Conservatives have little or no understanding of the effect their so-called reforms are having on those they claim they are trying to help. I’d like to set the record straight. Although I am a Labour member, I think it is appropriate to quote the late Baroness Thatcher: “Where there is error, may we bring truth.”

If taken to its obvious conclusions, the under-occupation charge – more correctly known as the Bedroom Tax – will cost the taxpayer far more than the former situation. The stated aim is to get people who are living in social housing with spare bedrooms to move into smaller accommodation or lose housing benefit. This means a disabled person in a house with thousands of pounds worth of adaptations for their disability, that has two extra bedrooms (one used as a carer’s respite room while the other would be more accurately defined as a cupboard), would lose so much money that they would be forced to move out. If they then went to a private, one-bedroom flat, the taxpayer would not only have to pay full housing benefit (around £100 extra per month) but also the cost of removing the disability adaptations from one dwelling and installing them in the other (thousands of pounds).

You see, the Conservative-led government got its sums wrong. It would be better for all involved (not least the taxpayer!) if ways could be found to prevent this extravagance with the public purse. What the Labour councillors were suggesting was a way of saving taxpayers’ money – not spending it.

Cllr Davies’ claim that welfare spending rose by 60 per cent under the last Labour government is scaremongering and cynical manipulation of the figures. Total expenditure on welfare when Labour took over in 1997 was 11.6 per cent of Gross Domestic Product. Under Labour, it averaged 10.7 per cent – that’s right, it went down – right up to the crash. Afterwards, benefits for children and working-age adults rose from an average 4.9 per cent of GDP to six per cent, which is what one might expect during a recession.

For clarity, the majority of welfare spending goes into pensions – around 55 per cent. Benefits for the unemployed total just three per cent. Fraudulent claims total a miniscule 0.7 per cent.

Moving on to Cllr Davies’ ridiculous claim that many people were claiming support who did not need or were not entitled to it, he claims that 900,000 people (in fact it was 878,300) dropped their claim for Employment and Support Allowance rather than take the Work Capability Assessment. In fact, DWP figures show that the number of cases closed before assessment has remained consistent since before the new assessment came into use. It is known as ‘churn’ – a turnover of claims withdrawn for perfectly normal reasons like people getting better or finding a job they can do, even if they’re ill. That is a result of people using the benefit system properly. Every month, around 130,000 people come off ESA – it isn’t a lifetime benefit; it’s something you claim for as long as you must. Because of the huge number of cases on the system and the amount of time it takes for them to be assessed and decided, some people who no longer need to claim haven’t even had their assessment.

DWP figures show the number of people receiving the benefit has in fact risen since the current government increased its scrutiny of disabled people.

Cllr Davies’ claim that the Work Capability Assessment is a “medical” test is also inaccurate. It is based on a system devised by an American insurance company called Unum, in order to avoid paying out to customers whose policies had matured. The aim is to convince very sick people that their illnesses are imagined. As a policy, you might consider that to be sick in itself. The result is horrifying but I’ll try to put it in context: According to the BBC, by October 30, 2012, the total number of British soldiers who had died in Afghanistan since military operations began there in 2002 was 437. That’s equivalent to the number of sick or disabled people who die while going through the work capability assessment system (or as a result of going through it) – every six weeks; an average of 73 per week (according to figures released after a Freedom of Information request).

The benefit cap is another waste of taxpayers’ money. It will reduce households’ ability to pay the rent, leading to an expected increase in homelessness of 40,000 families. How much will local authorities have to pay, housing families in temporary accommodation? Child poverty will skyrocket by 100,000. Many families may break up in response to the pressures. Parents who live separately and divide their children’s residency between them can claim up to £1,000 a week in benefits, while a couple living together may only claim £500. Of course, this would completely wipe out any saving the government would have made on that family, costing £26,000 more every year.

Cllr Davies rightly says £26,000 a year is more than most workers in Brecon and Radnorshire earn. That’s not a good thing – it means people here don’t get the pay they deserve. But even that figure is inaccurate as it omits benefits, so the average income of a working family is in fact £31,500, or £605 per week. The trouble with that is, if applied to benefit recipients, so few people would lose benefits that it would make the cap pointless. You see, it’s all about cutting the benefit bill; it isn’t about fairness at all. But, as I say, the Conservatives are so hopeless they can’t even get their sums right.

Cllr Davies is wrong to say that Labour opposes a benefit cap, however. There is cross-party support for limiting benefits as an incentive to seek work. The difference is that the Labour version would have been fair.

Cllr Davies says Labour supports a benefit system that gives workless households a higher income than the majority of working individuals who are paying for the system – and again he is manipulating the figures, comparing households with individuals. The simple fact is that unemployment benefits stood at around one-sixth of average earnings until April, when the one per cent uprating came into effect and pushed unemployed people closer to poverty. When benefit is so much less, in real terms, than earnings, a higher percentage increase does not mean you receive more money than a working person – something the Conservatives find hard to grasp, it seems.

So which do you believe – the comfortable lies that Cllr Davies has foisted on you, unencumbered by any factual evidence – or the unpalatable truth that the government’s imbecilic handling of the situation will cost us all many millions more in damage control when it all goes wrong?