Tuesday, June 22, 2010

On bombshells

Has there been a bigger U-turn than that performed by the LibDems on VAT?

I have to say that my private thinking was that the ConDems wouldn't dare hike VAT precisely because of the above shot from the General Election. Which either goes to show what a lousy political pundit I am, or the extent to which many of us continue to underestimate the LibDems sheer, brazen cheek.

In truth, the LibDems know that VAT, like all sales taxes, is regressive, and hits the poorest hardest. Introducing it in a single slug after Christmas will not only depress sales, but also push up inflation. Elsewhere...

*Child benefit, the universal benefit payout received by all families, will be frozen for three years.

*Tax credits, brought in by the previous government to help working families and people on low incomes, will be cut for households with a combined income of more than £40,000.

*Other changes to family-centred benefits will see the health and pregnancy grant abolished in 2011.

*The Sure Start maternity grant will be restricted to only the first-born child.

As always, my old mate Hopi Sen has done some spot-on reasearch amongst the budget pages - he's found that "the Office for Budgetary Responsibility projects lower growth, higher unemployment and higher inflation as a result of this budget. Yummy. It even states that it expects the output gap to be greater at the end of this It’s pretty rare for a government to come out and say that this is what it’s budget will do."

The real pain is yet to come, however, with the 25% reductions in departmental budgets. Believe me, if the reductions are anything like that in local government, services will be worse than decimated. And here's why:-

Education accounts for 40-45% of local spending. Yet the ConDems have said that education spending will be protected in the Comprehensive Spending Review. So that will leave councils trying to find a net 40-50% savings in the remaining (non-education) budget. And remember, some services rightly have to be protected by law (Social Services and the like). There is the real prospect that local services we have come to value, which are an intrinsic part of our everyday life, will disappear rapidly. Trust me - this isn't scaremongering.

We've always known that Tories have dreamt of hacking away at the State until there was little left. What no-one could have predicted was that it would be the LibDems - the cuddly, inoffensive slightly barking LibDems - who would be complicit in the deal.

Liberal Democrats - be warned. Labour will be coming after you to account for the havoc your Coalition is about to wreak on services that protect the weak and vulnerable. For the decision to allow public services to take the brunt of the pain rather than troubl;e the rich and ask them to shoulder their share of the burden. Whether you're a LibDem MP, a councillor or just a local candidate - expect to see the picture above on election literature time and time again. I hope you have some half-decent answers for the communities your Government is about to attack.


Disgusted with Liar's. said...

Nick if I were a Fibdem my resignation would be in the post NOW, the annoying thing is, like you I personally know many of the Fibsters and most are honourable people, but how they can sit back and accept this by their elected leader is insanity every Fib Cllr, or MP should stand down immediately and force the Partys hand. The coalition has failed after 4 weeks as many knew it would and should now be disolved and another election called. Clogg is just a puppet, why they have titled him Deputy Leader beggars belief he has no more authority or power than a bag of crisps he just wanted power and we all know how that corrupts..he is no more Deputy PM than any other Fib MP that was clear yesterday when he sat there like a good little boy just to make the numbers up and did exactly what "Big Dave" told him.

This in my opinion has been a "power rush" for Cloggy as for the poster of the bombshell ...yes it was a bombshell but not from the Tory's as we expected that, but from the sell out Fibsters.

Yesterday I got my Fibdem Focus through the door, no mention of VAT in that over exagerated piece of fiction.

Out here in Hurworth we have (for now) got two Fib Cllrs, I can see this being the return to the bad old days of a Tory's Village out here. If the Villagers vote Yellow and get Blue, many of the more well off will simply cut out the middle man and vote Blue to start with!

To see Cleggy sit there while this went ahead shows just how desperate for some power the Fibs are....well make the most of it Fibs we have your number now!

Off to Mike Barker's Blog to see how he is justifying this VAT Bombshell to all his voters and those who stood by him and helped with his campaign, as there no amount of his super healthy bran that I could eat that will help me digest this treachery, a budget that has or will hurt the old, disabled, unemployed, core services, our school funding, and most importantly our faith once again in a rotten political system where an unelected Gov. can screw it up for so many.

Sorry for the long winded post but I am so disappointed in the Fibsters, who I like many saw as a possible alternative party to one day run the country, no more :(

Liar's Out! said...

However the VAT measure sparked deep unease among Liberal Democrats as Labour accused them of acting as "fig leaves" for a Budget that would still hit the most vulnerable hardest.

Colchester MP Bob Russell issued a stark warning to the leadership, declaring: "I can't see myself at the moment voting for the Budget." He said he had told voters less than 50 days ago that he was opposed to a VAT rise - which was predicted as a potential "Tory Bombshell" in a major party poster campaign.

Mr Alexander, who was applauded when he addressed a meeting of the party's MPs after the statement, denied misleading voters

Well someone mislead voters!

Mike Barker said...

My thoughts are on my blog:

However, just to deal with the various anonymous posts here which criticise the Lib Dems for being part of a coalition that had to make tough choices and in doing so had to introduce measures that we did not campaign for: that, I'm afraid, is the nature of coalition politics.

The result of the General Election meant that stable government could only be guaranteed by the formation of a coalition. In a coalition both, or all, parties have to compromise. The effect of the Lib Dem inclusion in the coalition has been to ensure fairness, a start towards more redistributive income tax, protection for children from the poorest families and a fair deal for pensioners: none of which Labour would have given you.

And on the specific point about VAT, which I don't like any more than Nick does, but which sadly has proved to be necessary to help us dig ourselves out of the crisis Labour plunged us into, the alternative would have been the decimation of public services, or the continuation of the unsustainable level of debt interest payments which were crippling our country.

Disabled & Second Class said...

From another post on here,

"The worst bit of the budget: "To help make work pay from April 2013 people who have been on Jobseeker's Allowance for 12 months or more, will have a 10% reduction in their Housing Benefit." So the unemployed are to be made destitute or homeless?"

So Mike where do you and the Lib's stand on this bearing in mind the average national housing benefit claim is £400 a month and JSA is £43.80 a week, if after a year you take 10% off Mr X's £400 that equates nearly to the loss of one full weeks JSA, just how does Mr X pay for food and bills etc.

Simple he will do fiddle work or worse steal can you and your rich chums in Whitehall not see the spiral you will force otherwise honest decent people into?

Also Disability Living Allowance is just that, an allowance to help with the extra living needs of disabled people, why is it being seen as some sort of perk, as a disabled person myself I would willingly give up my DLA for good health as would 99% of the ill people I know. Why are you punishing the weakest in society?

What of foreign aid is that still to continue feed those abroad while you treat the old, disabled and ill as paupers and second class citizens here, while still sending money we cannot afford to help other Countries????

Where did the £60 Million for Haiti miraculously appear from?

You should be stopping all imigrantion FULL STOP before punishing the natives with your Draconian measures.

Tough choices you say, as Clegg claimmed approx £140K per year for the last 4 years in Expenses as well as his Allowance...well I just made an easy choice never vote Fib again!

Vote Yellow get Blue :(

Mike Barker said...

Unfortunately no-one is immune from the tough choices that have had to be made to save this country's economy from the desperate state that Labour got us into: and that includes the unemployed and those on benefits.

Further than this, I would argue that it is desperately unfair on those who do take on on low paid jobs in order to provide for themselves and their families to see other people happily living on the benefits their taxes pay for, because, for many people, working produces a lower income than living on benefits - and this point is meant generally, not aimed at any particular individuals. With our commitment to raising tax allowances, this issue is being addressed, from the taxation point of view at least.

I make no apologies for honouring our international commitment to meet agreed targets for international aid: go join UKIP or BNP if this bothers you so much.

A certain amount of controlled immigration is valuable to our economy and society in providing skills and experience we might lack among our own workforce, and, as a civilised society we should always be a safe haven from those genuinely fleeing political or personal persecution in less tolerant societies. Again, you migth find your opinions better served by joining UKIP or BNP.

As for expenses: all MPs have legitimate expenses enabling them to pay for necessary accommodation and travel costs. The amount Lib Dem MPs claim for this is no different from those from any other party. Without these necessary expenses only the very rich or people lving in London could become MPs.

The Truth Hurts said...

Mike says..

"I make no apologies for honouring our international commitment to meet agreed targets for international aid: go join UKIP or BNP if this bothers you so much."

Obviously someone hit a nerve there, It puzzles me why people are happy to send money abroad rather than here in the UK first, that speaks volumes and why does common sense or an opinion on this make anyone a BNP Bigot? Come on Mike that was below you!

Mike goes on to say..

"As for expenses: all MPs have legitimate expenses enabling them to pay for necessary accommodation and travel costs. The amount Lib Dem MPs claim for this is no different from those from any other party.

Yes we remember those legitimate expenses ...Duck Houses, Moat cleaning really legitimate, but I am sure that has stopped now.

Funny that Mike they all seem to have expenses over £130K it does seem a bit much to those of us about to be hammered by your Tory cuts.

"Without these necessary expenses only the very rich or people living in London could become MPs."

Aren't there many independantly wealthy MP's and many of those who are claiming these expenses are already millionaires so why are MP's not means tested that would be a much fairer expenses system and while we are on lets send them for medicals too as I don't think at present many are fit to serve!

YES, means test MP's after passing a medical possibly even one by ATOS :(

So much for Liberal views Mike sounds to me as if you are reading from the Tory song sheet, it is clear you don't like the critisism your Party is coming under. But why not stand up against Clegg and his breaking manefesto promises, surely if you now agree so strongly with these policy's should you and other like you not have campaigned on them in the first place?

One can only ask themselves why if they are so good now were they not in your manefesto...because they were BAD then and you as a Party are on a damage limitation exercise after yesterdays total and utter colapse of faith in the Fib's.

Just to say Mike this is not realy a personal dig but how many feel, let down by the party as a whole and that we wasted a vote on Yellow and it's promises only to get Blue and their's, when perhaps we should have stuck with Red all along.

Better the devil you know...or so they say :(

Mike Barker said...

But you didn't vote yellow and get blue. You voted yellow, more people voted blue, and what you got was a blue and yellow mix where many of the progressive and fair policies of the Lib Dems have been introduced already, both in this budget and elsewhere.

If you'd stuck with Red we'd have had a broken economy within a year where those hit hardest would have been the poor and needy.

I don't see our acceptance of the VAT rise as a broken manifesto promise, unlike the editor of the Northern Echo whose tweets seem to have lost the plot!

A manifesto is drawn up to say what a political party would do if it gained overall control of government. That didn't happen, so compromise has to follow, otherwise there would be no government, or a minority Tory Government unable to command international confidence.

Because there is a coalition there must be compromise. Those who favour a more proportional electoral system should welcome the sort of politics where compromise needs to be reached in government.

Yesterday's budget would not have been the same if the Conservatives had had an overall majority. The income tax starting point would not have been raised by anything like £1,000 and Capital Gains Tax would not have increased to 28% for higher earners. There are other areas too which have a distinctly Lib Dem flavour.

However there is no denying that there are things in the budget, such the VAT rise, that would not have been introduced by a Lib Dem government. That is not a "betrayal". It simply reflects the fact that we did not get enough votes/seats to form that majority. I don't like the VAT rise, but I accept its introduction as part of the process of achieving compromise and a government which is strong enough and determined enough to get us out the hole Labour left us in.

Those opposition politicians accusing the Lib Dems of betrayal might care to consider how unwilling the Labour leadership was to engage in meaningful coalition talks and also how it was the electorate whose votes created this situation.

There will have to be more compromises during this government. That's how coalition government works. Wake up and get used to it!

Finally, it would not be "common sense" to withdraw our international aid budget. Quite apart from the fact that, even after 13 years of Labour, each and every one of us in this country is far better off than many millions of people in the developing world, and as fellow human being we owe it to them to help them out of poverty, there is also the hope of a long-term payback to this country if we play an active role now in helping these developing nations. Only UKIP and BNP believe otherwise.

Now, if you'll excuse me for a few hours, I have a football match to watch.

Speechless said...


"there is also the hope of a long-term payback to this country if we play an active role now in helping these developing nations."

What year 3057?

"as fellow human being we owe it to them to help them out of poverty"

Bu twhat of our own peoples needs this is NOT bigotry it is survial.

Enjoy your football watching another set of overpaid loosers ;)

The Sherrif of Libdom said...

How much from the deficit could be saved if we instantly recalled all our troops from Afghanistan?

We really could do with them back here for when the people have ahd enough and take to the streets.

Are we on the brink of a peoples revolution?

Why not use the Robin Hood tax if it can raise 20BN at 0.01% imagine what 1% would achieve, but no we can't ask the rich bankers for more than 0.01% but can slam VAT up 2.5% :/ Crazy!

james said...

Mike, the Tories could have been permitted to put forward their emergency budget as a minority government. Then there would genuinely have been the chance to stop them.

As it stands, the LibDems have nothing. The implications of the budget are regressive - to say that the top are hit hardest in terms of income ignores the wealth they own. Certainly, the poorest have been hit hardest, and those in the middle will be squeezed by rising prices and reduced services.

It is ridiculous to suggest Labour were unwilling to enter meaningful coalition talks - people like Clegg, Laws and Huhne have more in common with Cameron, Osborne and Clarke than with Labour politicians.

As for your ludicrous claims about the economy, Mike - Labour halted recession with an economic stimulus. I am sure you are not so ignorant of economics that you are unaware that every recession causes a public spending deficit - and recovery brings it down. The structural part of the deficit is hard to calculate and the focus should be on providing economic stability.

The declaration of an Age of Austerity across Europe - the UK's main export market - makes it likely export-led growth will be weaker in coming years! In other words, events since the election have made it more important for caution.

The budget is not only regressive - if it is implemented we will be back in recession, with more firms going bust, more homes being repossessed, and more people unemployed.

Hope is Lost. said...

Jame's the Lib's don't seem to realise or want to accept they have let the people down by standing along side Cameroon.

In my eye's they are nothing but power hungry liars and I do not mean the likes of Mike and local Cll's but the MP's who are still sitting back and not speaking out against their leaders support of Cameron.

But then again those same MP's will be sitting pretty know they have an £60K allowance and approx £130K expenses to cushion their blow.

I personally feel let down by what could have been a Party able to offer an alternative to the 2 main party's and now we can all see they are just the same deep down.

I don't know how to overthrow Clegg as leader or even disband the coilition but it needs to be done and anothe election held ASAP after the election many voters may see the error of their ways and change their vote...this is what the Lib's fear loosing that little power they think they have.

Cameron has sold them and the country a lemon the only difference is the people of the Country can see that and Cleggy can't.

Anonymous said...

True Blue writes.....

Oooh sour grapes, moaning and nashing of teeth all round on here. Some facts for the anonymous and otherwise fellow travellers and for you Councillor Labour spent more than the country earned. Labour ran up huge debts which now have to be repaid. Labour lost the election. Get over it.

You dont have any support and are turning into a sad moaning rump with very little credibility.

No VAT said...

Who are these debts to?

Why do they have to be paid so fast?

Whats wrong with "slowly, slowly catchy Monkey" why such severe cuts and nearly all aimed at the weakest in society, is this Tory compassion?

Yes Labour lost but the Conservatives did not win either both sides needed the help of those back stabbing liars the Libs who finally have shown how desperate for power they are by jumping into bed with Cameron then breaking their election promises, it will end in tears!

But not for the rich

james said...

To answer No VAT - UK debts are denominated in pounds and mostly owned by UK firms and pension funds, they are longer-term than those countries affected by sovereign debt crises.

Anonymous said...

James said "UK debts are denominated in pounds and mostly owned by UK firms and pension funds"

So why do the people have to pay the debts of UK firms and pension funds?