Have Libdems abandoned those most in need of help?

by Adam Lent

There is a lot to like in this coalition deal stuff that the Labour Government should have attended to long ago: political reform, cracking down on tax avoidance, regulating and taxing the banks, restoring the link between the state pension and earnings, environmental measures.

But there are three parts of the agreement that must make any serious progressive question the priorities of the Liberal Democrat leadership. Unemployment, the deficit and immigration have all been handed over to the Tories with only moderate qualifications. They are all areas which will most seriously impact on the poorest and most disadvantaged.

The Conservative Party policy on unemployment is very weak, planning to abolish the most effective initiatives of Labour – the Future Jobs Fund and the Job Guarantee – and replace them with half-baked schemes such as a sole trader mentoring programme for young people.

On immigration, the Liberal Democrats humane plans have been ditched in favour of a Tory policy designed to please the tabloids rather than deal realistically or fairly with the issue.

And on the deficit, it seems, the Conservatives have been given carte blanche to start cutting services as quickly as possible.

As a result, these policy areas are now controlled by Conservative Cabinet and junior ministers with the one exception of David Laws at the Treasury.

The Tories are not entirely the Tories of old, it is true, but on these three issues I can see little to distinguish them from their Thatcherite fore-runners who had such an abysmal record on protecting those without work, those reliant on public services or those trying to survive away from their home country.

Liberal Democrats need to ask themselves whether, come 2015, they will really be able to look back and say that their coalition helped those most in need of that help.

How regressive is VAT?

Tim Horton told the Jeremy Vine show – in a discussion with Ruth Lea in which she proposed 50% on luxury yachts from the right – used a very good concise summary of how to get across the point that VAT hits the poorest hardest.
The richest 10% pay one in every 25 pounds of their income in VAT; the poorest 10% pay one in every seven pounds as VAT.

This is “The effects of taxes and benefits on household income” from the Office for National Statistics. (PDF file)

If you look at table 14 (appendix 1), which shows the income, taxes and benefit for all household decile groups. The figures are for 2007-08.

You can see that the bottom decile have an average gross income of £8820, and pay out £1240 in VAT – that is one pound in seven.

You can see that the top decile have an average gross income of £92936, and pay out £3688 in VAT – that is one pound in every twenty-five.

Gross income is the conventional way to look at what is the appropriate tax mix.

If we were to instead take disposable income (after direct taxes have been levied), the poorest 10% are in fact paying a higher proportion (one pound in six) in VAT – an even more striking impact – while the richest 10% are paying one in nineteen pounds. That again shows how the impact of VAT is very regressive.

Who Knows Who: the coalition cabinet

By Anna Doble, Channel 4 News
They are not all Oxford chums, millionaires and the Notting Hill set, but quite a large slice are. Who Knows Who examines the old rivals and new faces in the Con-Lib cabinet.

The oldest is 69 (Ken Clarke), the youngest is about to turn 38 (Danny Alexander), 43 is the magic number. Two are former presidents of the Oxford Union (William Hague, Michael Gove) and two edited the Oxford student magazine (George Osborne and Chris Huhne). Only four are female, a fair few are millionaires and of course five cabinet members are Liberal Democrats.

Does ‘new politics’ mean more Oxbridge males?

Who Knows Who takes a look at the connections in the coalition Cabinet.

Prime Minister – David Cameron (Con)
Age: 43
School: Eton (independent)
University: Oxford

Cameron’s education and aristocratic background are by now well-known. The son of a stockbroker, he is a descendant of William IV, a former classmate of Prince Edward, an old Etonian (the 19th at Number 10) and, along with George Osborne and London mayor Boris Johnson, an ex-Buller boy (an Oxford club famed for drinking binges and vandalism).

Cameron is a former special adviser to Norman Lamont who was succeeded as chancellor by the man picked by the PM as new Justice Secretary, Ken Clarke. Cameron’s closest ally until now has been Osborne, the new chancellor, who is a personal friend and godfather of his children. His coupling with Nick Clegg could test this.

Deputy Prime Minister – Nick Clegg (Lib)

Age: 43
School: Westminster (independent)
University: Cambridge

Clegg’s background all but twins him with Cameron. Swap Eton for Westminster, Oxford for Cambridge and a father who was a stockbroker for one that was a banker and the pairing seems natural. Clegg is reported to have joined the Conservative club at Cambridge in 1986 but has said he “can’t remember” doing so.

The Lib Dem leader worked for a former Tory home secretary Leon Brittan at the European Commission in the late nineties. His wife Miriam is a former colleague and friend of Cameron’s chief of staff Ed Llewellyn. Clegg beat new Climate Change Secretary Chris Huhne to the Lib Dem leadership in 2007.

Foreign Secretary – William Hague (Con)

Age: 49
School: Ripon Grammar, Wath Comprehenisve
University: Oxford

One of two former presidents of the Oxford union here (the other is Education Secretary Michael Gove) Hague became an MP in 1989, succeeding Nick Clegg’s old boss Leon Brittan to win the seat of Richmond in North Yorkshire.

Hague beat off competition from Cabinet colleague Ken Clarke to lead the Tory party from 1997 until 2001. He was followed by another unsuccessful Tory leader, the new Work and Pensions Secretary Iain Duncan Smith.

Chancellor of the Exchequer – George Osborne (Con)
Age: 38
School: St Paul’s (independent)
University: Oxford

George Osborne, Cameron’s close friend, is the youngest chancellor for 124 years. Like the prime minister, he was a member of Oxford’s Bullingdon club and the Tory “Notting Hill set” of the late nineties and early 2000s. He is a multi-millionaire through his family wallpaper firm.

He has an interesting link with new Lib Dem colleague Chris Huhne. Bothe are former editors of Oxford student magazine, Isis. Both Osborne and Cameron were junior advisers to John Major, the last Conservative PM. Osborne also worked as a speech writer for new Foreign Secretary William Hague.

Lord chancellor, Justice Secretary – Ken Clarke (Con)

Age: 69
School: Nottingham High School (independent)
University: Cambridge

Clarke, the oldest Cabinet member, is regarded as a political “big beast”. Cameron is the fourth Conservative prime minister he has served under after high-profile stints with Edward Heath, Margaret Thatcher and John Major.

He may find some closer ties with his pro-Europe Lib Dem colleagues than with his old adversary Iain Duncan Smith, the Eurosceptic who pipped him to the Tory leadership in 2001. Along with Vince Cable, Clarke, a former chancellor, will be a reassuring presence to those who fear Osborne lacks Treasury clout.

Home Secretary, Minister for Women and Equality – Theresa May (Con)

Age: 53
School: Holton Park Girls’ Grammar School (now Wheatley Comprehensive)
University: Oxford

A former consultant at the Bank of England, May became an MP at the 1997 general election. She rose to prominence quickly and has always done well in Tory job hand-outs.

She has served two former Tory leaders who now sit beside her in the new cabinet – William Hague and Iain Duncan Smith. When Cameron became leader, he made her shadow leader of the Commons. As Home Secretary, she is now the most high-profile woman in government.

Defence Secretary – Liam Fox (Con)

Age: 48
School: St Bride’s High School (comprehensive)
University: Glasgow

Liam Fox is one of the few members of the new cabinet who was not privately educated and did not attend Oxford or Cambridge. He grew up in a council house in East Kilbride.

Fox became an MP in 1992 and later worked for both Hague and Duncan Smith as shadow health secretary. Fox is UK director of The Atlantic Bridge, a transatlantic committee set up to promote the UK’s “special relationship” with the US. William Hague, George Osborne and Michael Gove sit on its advisory panel.

Business Secretary – Vince Cable (Lib)

Age: 67
School: Nunthorpe Grammar (now Millthorpe School, comprehensive)
University: Cambridge

Cable, a former Labour councillor who worked for the late John Smith, must now work in tandem with chancellor George Osborne. It is clear that, of the top Lib Dems, he is the most uneasy about the Con-Lib union.

However, his mother was a Tory voter and his experience working as chief economist at both Shell and Chatham House add considerable financial experience to the team. He is the second oldest cabinet member after Ken Clarke.

Work and Pensions Secretary – Iain Duncan Smith (Con)

Age: 56
School: HMS Conway, naval training school
University: Sandhurst Military Academy

Duncan-Smith, a former Tory leader, is the only member of cabinet who did not go to university. The son of a Royal Air Force captain, he instead attended the Sandhurst military academy a few years after Prince Charles.

He is an old rival to Ken Clarke (they have fought against each other for the Tory leadership and disagree on Europe) but his place in the cabinet should appease rightwingers who are sceptical about the Lib Dem presence.

Energy and Climate Change Secretary – Chris Huhne (Lib)

Age: 55
School: Westminster, the Sorbonne
University: Oxford

Huhne, before Clegg, attended Westminster School. He is one of nine Oxford alumni in the coalition cabinet. Like George Osborne he was a Demy scholar who edited the student magazine Isis.

He lost the Lib Dem leadership battle in 2007. A former Labour activist, it is interesting to ponder whether the coalition would have come about with him at the helm. Huhne was, however, on the negotiation team which agreed the deal with fellow Magdalen graduate William Hague.

Health Secretary – Andrew Lansley (Con)

Age: 53
School: Brentwood
University: Exeter (independent)

The new health secretary is one of the few non-Oxbridge members of the new set-up. Instead he attended Exeter. The former civil servant worked as private secretary to Thatcher minister Norman Tebbit in the 1980s. Interestingly, Tebbit called for Cameron to burst the “Clegg bubble” during the election campaign and warned against the coalition deal.

A Lansley-run campaign helped John Major retain power at the 1992 election. He later worked for Iain Duncan Smith on the failed 2001 Tory bid for power.

Education Secretary – Michael Gove (Con)

Age: 42
School: Robert Gordon’s College (independent)
University: Oxford

Gove, like Hague, is a former president of the Oxford Union and like Osborne and Huhne has worked as a journalist. He has written for The Times and The Spectator and authored a biography of Michael Portillo, an old rival to William Hague. Gove also worked for BBC Radio 4’s Today Programme.

The new education secretary is regarded as one of the “new breed” of Tories, alongside Cameron and Osborne. They are the same age and graduated together before forming the so-called “Notting Hill set”. Gove is a former chairman of rightwing think tank Police Exchange.

Communities and Local Government Secretary – Eric Pickles (Con)

Age: 58
School: Greenhead Grammar (now high school, comprehensive)
University: Leeds Polytechnic (now Leeds Met)

Pickles is the Prescott to Cameron’s Tony Blair. Proudly working class, one of his great-grandfathers helped found the Independent Labour Party, but Pickles switched to the Tories in 1968.

The new Communities and Local Government Secretary is opposed to electoral reform, which will not endear him to his new Lib Dem colleagues. Meanwhile, in 2006 he took action to ensure a fish and chip shop in his constituency removed an “Eric Pickled Egg” from its menu.

Transport Secretary – Philip Hammond (Con)

Age: 54
School: Shenfield School (comprehensive)
University: Oxford

Another Oxonian, Hammond was a successful businessman prior to entering parliament in 1997. He was promoted to the Tory frontbench by new Cabinet colleague William Hague.

Hammond is said to have amassed a wealth of £9m. He has previously worked as a consultant to the World Bank.

Environment, Food and Rural Affairs – Caroline Spelman (Con)

Age: 58
School: Herts & Essex High School (comprehensive)
University: Queen Mary

Caroline Spelman is a cabinet rarity. She is female, state school educated and a graduate of neither Oxford nor Cambridge.

A former commodity secretary at the National Farmer’s Union, she became an MP in 1997 and was quickly promoted by Iain Duncan Smith. She has previously worked for new home secretary Theresa May on environment issues. She is married to Mark Spelman, a senior partner at Accenture.

International Development – Andrew Mitchell (Con)

Age: 54
School: Rugby School (independent, boarding)
University: Cambridge

Mitchell is former president of the Cambridge Union and chair of the university’s Conservative club. He served in John Major’s government as a junior minister.

He is one of several cabinet millionaires, with an estimated fortune of £2m.

Northern Ireland – Owen Paterson (Con)

Age: 53
School: Radley College (independent)
University: Cambridge

Paterson embarked on a career in the leather business after graduating from Cambridge. He is an outspoken Eurosceptic which will align him with Iain Duncan Smith against the Lib Dems.

Paterson was first elected in 1997 and has been shadow secretary for Northern Ireland since 2007.

Scotland Secretary – Danny Alexander (Lib)

Age: 37
School: Lochaber High School (comprehensive)
University: Oxford

Alexander is the youngest cabinet member and, along with Clegg, the unexpected star of election 2010. After leaving Oxford, he worked as a press officer, first for the Scottish Lib Dems and later for a pro-Europe pressure group.

He will already be friendly with Cabinet colleague Ken Clarke, having worked with him at the Britain in Europe group. He also coordinated the Lib Dem 2010 manifesto.

Wales Secretary – Cheryl Gillan (Con)

Age: 58
School: Cheltenham Ladies’ College (independent)
University: The College of Law

Gillan is one of several cabinet members hailing from a military family (Iain Duncan Smith, Jeremy Hunt). Her father was an Army officer, her mother a Wren.

Gillan has served as the chairman of the right-wing Bow Group. She is another cabinet millionaire with a wealth of £1m. In 2009 it emerged she had claimed parliamentary expenses for dog food. Incidentally, she keeps chickens.

Culture, Olympics, Media and Sport Secretary – Jeremy Hunt (Con)
Age: 43
School: Charterhouse School (independent)
University: Oxford

Hunt, whose father was a senior officer in the Royal Navy, was head boy at Charterhouse before going to Oxford where he gained a first in philosophy, politics and economics (PPE).

He comes from the Oxonian Tory set which includes fellow 43-year-olds David Cameron and Michael Gove. Hunt worked in public relations before entering parliament at the 2005 election.

Chief secretary to the Treasury – David Laws (Lib)

Age: 44
School: St George’s College (independent)
University: Cambridge

David Laws was a key figure on the Lib Dem negotiating team which brought about this coalition.

The former JP Morgan managing director took over Lord Ashdown‘s Yeovil seat in 2001 after a series of high-profile roles in finance. He co-edited the Orange Book, which sets out liberal economic solutions, and will work closely with George Osborne at the Treasury.

Duchy of Lancaster – Lord Strathclyde (Con)

Age: 50
School: Wellington College (independent)
University: UEA

Lord Strathclyde is something of a Westminster veteran, having first arrived in SW1 in 1985. He was government whip in Margaret Thatcher’s administration of the late 1980s.

A former insurance broker, he was a minister of state at the Department of Trade and Industry during the 1990s.

Minister without Portfolio – Baroness Warsi (Con)

Age: 39
School: Birkdale High School (comprehensive)
University: Leeds

Sayeeda Warsi, the first Muslim woman to serve in a British cabinet, is one of David Cameron’s “stars” and one of three still in their thirties (along with Osborne and Alexander).

Warsi gave up her job as a solicitor in 2004 to stand for Parliament in her home town of Dewsbury, West Yorkshire, but lost out to Labour’s Shahid Malik. She has previously worked as a special adviser to Michael Howard.

Also attending cabinet:

Minister for the Cabinet Office, Paymaster General – Francis Maude

Minister of State, Cabinet Office – Oliver Letwin

Minister of State, Department for Business, Innovation and Skills – David Willetts

Leader of the Commons – Sir George Young

Parliamentary Secretary to the Treasury, Chief Whip – Patrick McLoughlin

Attorney General – Dominic Grieve

Is the economy greener?

The environment has been David Cameron’s clearest break with the Conservative Party of the past. Labour has set ambitious carbon reduction targets but the lack of any meaningful international agreement at the Copenhagen summit has left the Government’s green credentials exposed. The Tories have scored points with environmentalists by opposing Heathrow expansion and supporting high speed rail but lasting green credibility requires more than symbolic policy shifts: it must see Britain fundamentally reshaping its economy to reduce emissions.
The Test:
In an effort to keep global temperature rise below 2 degrees, the UK has set a target of cutting CO2 emissions by 34 per cent of 1990 levels by 2020. By the end of the next parliament, a progressive government would need to be well on its way to meeting this – and have reduced them by at least 20 per cent by the end of the Parliament.

Tory ‘efficiency savings’ a smokescreen for job cuts says Vince Cable

Sat, 24 Apr 2010

“Cutting too soon and pushing the economy back into recession will make the deficit worse, as tax receipts fall and benefit payments rise,” the Liberal Democrat Shadow Chancellor said.

Commenting on the IMF report cited by Gordon Brown today, which said spending should be maintained through 2010 to support the economy, Vince Cable said:

“The end of the fiscal stimulus has seen billions taken out of the economy. We have already seen the effects of this with growth falling to just 0.2% and there is a very real danger the economy could fall back into recession.

“The IMF is right to argue spending should be maintained this year. Cutting too soon and pushing the economy back into recession will make the deficit worse, as tax receipts fall and benefit payments rise.

“The Conservatives’ so-called efficiency savings are particularly dangerous. They have no clue where or how these ‘efficiencies’ will be made, making it likely they will be nothing more than a smoke screen for job cuts.”