Nick Clegg admits cuts were a political choice


9:02 am - March 15th 2011

by Duncan Weldon    


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A little noted, but I think important, Nick Clegg u-turn in his speech to Lib Dem Spring Conference.

Speaking about the Government’s actions to close the deficit he said:

By cutting the deficit decisively we have restored confidence in Britain.

Essential – because without confidence there can be no growth.

We have helped keep interest rates lower for longer, helping families, helping businesses.

It has meant making difficult choices.

But at least they have been our choices…

Not forced on us by the bond markets as they have been in Greece and Ireland.

And the risks of delay far outweigh the risks of swift action.

(My emphasis)

Two interesting things here – first the admission that the speed of deficit reduction is a ‘choice’, in contrast to the Government’s usual ‘no alternative’ line.

Second the admission that the cuts were ‘not forced on us by the bond markets’ as in Greece and Ireland.

This is quite a change from his claims, as recently as January, that Britain, back in May last year, was in a Greek-style crisis and on the ‘brink of banktuptcy’.

No shift in policy, but certainly a change in argument – and a welcome one at that.

Clegg is right that Osborne’s plans were not imposed by the bond market but were instead a political choice. I doubt he’ll stick to this argument for long.

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About the author
Duncan is a regular contributor. He has worked as an economist at the Bank of England, in fund management and at the Labour Party. He is a Senior Policy Officer at the TUC’s Economic and Social Affairs Department.
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Reader comments


1. Cynical/Realist?

“By cutting the deficit decisively we have restored confidence in Britain.”

I think this is a statement of wishful thinking rather than anything near fact. Is confidence restored in Britain? Or has confidence been hit even more by the actions of this government? The last quarters GDP figures were easilly passed of as the result of a bit of cold – the next quarters figures will be very interesting.

2. So Much For Subtlety

“This is quite a change from his claims, as recently as January, that Britain, back in May last year, was in a Greek-style crisis and on the ‘brink of banktuptcy’.”

He acted before Britain was not merely on the brink of bankruptcy but actually bankrupt. Thus preventing a Greek-style crisis. Good for him. You would rather he had waited?

I think you are reading too much into this. But if not, I have a simple question – how much more debt would you think we could acquire before we are forced into a Greek-style bankruptcy?

Oh for goodness sake.

He obviously meant “we started cutting *before* we were forced to…”

Whether you agree with him that we would have been forced to is a different issue.

You can do better than this slightly desperate line!

Isn’t he talking about the decisions on what to cut, rather than the decision to cut? C’mon, this is a bit much.

“Two interesting things here – first the admission that the speed of deficit reduction is a ‘choice’, in contrast to the Government’s usual ‘no alternative’ line.”

I thought it was fairly obvious that “no alternative” meant “no viable alternative”, rather than “there is literally no other choice we could make at this juncture, and it is physically impossible for us to choose to do something else”.

“Second the admission that the cuts were ‘not forced on us by the bond markets’ as in Greece and Ireland.”

But they would have been had the cuts not been made.

Yeah, this post is a bit of a stretch – as others have said, it’s pretty obvious what he meant.

“By cutting the deficit decisively”

Huh? When did this happen, exactly? The government has begun to cut *spending* decisively in certain areas; they are certainly not yet in a position to claim that they’ve succeeded in “cutting the deficit”. That depends on what effects their “decisive” actions have on consumer confidence, growth, unemployment etc in the medium term.

So when did all the Lib Dem supporters here become Tories? On the run up to the election you all voted for the lib Dems based on a policy if defecit reduction akin to Labours, remember even Nicks 6 year old new this? But all of a sudden you have all done a political and idealogical u- turn and defend this bullshit as if it was your own idea!!

But he admits the cuts were entered into aggressively to reassure the bond markets – that was the priority. So the bond markets didn’t demand first, they were appeased pre-emptively, and they were thus still effectively in control. A dictator who doesn’t send in the storm troops (holding them back as a threat) but does demand that the population do his will is no less a dictator if the population repress themselves rather than oppose him.

“But at least they have been our choices…”

As someone who was actually there and sat through the whole thing, it was clear from context that he was talking about the choices of what to cut and how and what to save. He was also making the argument that if the cuts had not been made then we would have ended up in a situation where large cuts are forced on us with us having very little say in how they were implemented.

Seriously, stop reading so much into a few lines by one man and actually do something productive such as campaigning to keep your local surestart centre open.

Whilst we are on the subject of cuts please accept my aplogies because I feel it vitally important to let people know that there is currently two online petitions running, that are trying to protect/save The National Health Service.

http://www.38degrees.org.uk

http://saveournhs.org/

@10 George

Can u not start by convincing your own party leadership to oppose the closure of surestart centres instead of enabling them?

GWP @ 10

As someone who was actually there and sat through the whole thing, it was clear from context that he was talking about the choices of what to cut and how and what to save.

Wow! Talk about being condemned out of your own mouth! You admit that deciding to go after the weak, the ill and disabled was a positive choice? You can look at the results of these cuts have had on Sue Marsh (time limiting cuts will affect my family) and think that she is responsible for the deficit? You think that the people who are actively and deliberately being driven in poverty deserve to suffer? Christ, if these are the choices that you people made, I wonder who you ‘saved’ from cuts. Apart from the Tory bankers, of course, that goes without saying.

What about all this waste we were told that existed in Whitehall? To normal people when we talk about ‘waste’ we mean unnecessary paperwork and perhaps extravagant furniture upgrades. When the Tory talk about ‘waste’ they mean spending on the sick, disabled and unemployed.

Perhaps you sleep well at night, George, but did you get into politics to watch people like Sue Marsh suffer? What are you getting out of that, George? For the life of me, I cannot see it. ‘So much for subtlety’ I get, social misfits often have to lash out at people less fortunate or in dire straights, but you come across a decent person who, even if I disagree with on a number of issues, I could happily spend an hour with in a pub. So what are you getting out of the coalition? Does Sue’s suffering justify the AV referendum?

14. Neil Baker

Duncan’s never let anything like the truth get in the way of his usual LibCon rants about economics, so I don’t see why this disastrous post should be any surprise.

For all the efficiency savings being required of the NHS and the Police, the record budget deficit isn’t constraining the enthusiasm of the coalition government for introducing a No Fly Zone over Libya but no surprise. There’s nothing quite like starting up a bit of warfare for distracting popular attention from failings in a government’s domestic policies and woes on the home front.

Fortunately, the recent G8 meeting wasn’t swept away with the enthusiasm:

“Prospects of the swift establishment of a no-fly zone over Libya have receded after members of the G8 group failed to give their backing at a summit in Paris.”
http://www.google.com/hostednews/ukpress/article/ALeqM5hxAgbPSToUyiOxkoA7EuR01iAe_Q?docId=N0468731300095033794A

Should we be sending a few more teams of Special Forces dressed in black to land behing enemy lines at night? The trouble last time IMO is that they didn’t have the correct disguises – like enveloping cloaks, large felt hats with floppy brims and false beards.
http://www.dailymail.co.uk/news/article-1365736/What-Our-Man-Libyan-Farm-really-Hard-working-manager-met-SAS-troops-farcical-operation-meet-rebels.html

16. Duncan Weldon

Surely this is not a controversial post?

Clegg’s line from May until this weekend has been ‘we were on the brink of bankruptcy, we had no alternative’. This weekend it was ‘we took a tough choice, we were not forced into this by bond markets as in Greece in Ireland’.

You can have a ‘tough choice’ or you can have ‘no alterative’. You can’t have both.

In a similar way you can have ‘Labour would be cutting just £2bn less than us in 2011’ or you can have ‘Labour have no plan for he deficit and are wracking up spending commitments’. You can’t have both.

@12

Not a single surestart centre has been closed by a Lib Dem council. Lib Dem run Sheffield had a cut in funding on the same level as that as Labour run Manchester. In Sheffield front-line services are being kept open and 270 people have been made redundant. In Manchester over 2,000 people are being made redundant and several frontline services, such as libraries, are being closed. Don’t blame the Lib Dems for decisions made by local councils.

@13

Perhaps it would interest you to know that one of the first things conference did last weekend was to pass a motion against cuts to DLA or the mobility allowance? I supported that motion so perhaps you would be kind enough to check to see how individuals acted before you start spewing bile at them.

Thanks.

18. Chaise Guevara

@ 17 George W Potter

“In Manchester over 2,000 people are being made redundant and several frontline services, such as libraries, are being closed. Don’t blame the Lib Dems for decisions made by local councils.”

I’m trying not to jump on the Lib-Dem-bashing bandwagon, but nonsense like this really tests my patience. Regardless of whether or not their decision to join the coalition was a good idea overall, the government of which the Lib Dems are part of and made possible are the ones who have handed that budget cut to Manchester Council – which, by the way, remains popular despite the sacrifices it has been forced to make by Westminster.

Airily declaring that the cuts to Sheffield were on “the same level” is pointless – people on here are smart enough to know that direct comparisions between two different cities are not revealing. Labour didn’t sack 2,000 people in Manchester, the Tories and Lib Dems did.

Christ, it pisses me off that this government thinks it can get other people to do its dirty work for it then rid itself of blame. It won’t wash, mate.

19. Neil Baker

@Chaise lol, who are you trying to kid? For months you’ve been riding the LD-hating bandwagon all over these pages. You’re the wagon captain, mate. Read this again, slowly:

“Lib Dem run Sheffield had a cut in funding on the same level as that as Labour run Manchester.”

So how then can you say the cuts have nothing to do with who is in charge of each council, and then blame it all on the governing parties?

I do not know whether to laugh or cry at your disingenuous position. Were you also excusing Labour councillors “doing their duty” by passing budget cuts on LC a few weeks ago? Probably.

20. Planeshift

“one of the first things conference did last weekend was to pass a motion against cuts to DLA or the mobility allowance?”

I’m sure those responsible for the cut will be shitting themselves at the fact a motion has been passed. Labour party conferences passed numerous motions against Blairite policies, and nothing was achieved.

Unlike the tories, the lib dems still remain a party of decent principled people – particularly at the grassroots level, but I’m afraid passing conferance motions isn’t going to prevent anything. You need to come up with something a bit more convincing if you want to avoid the party becomming toxified through association. Right now, its becomming difficult to see what you gain from the coalition.

@16

Clegg’s line from May until this weekend has been ‘we were on the brink of bankruptcy, we had no alternative’. This weekend it was ‘we took a tough choice, we were not forced into this by bond markets as in Greece in Ireland’.

What do you say to the specific responses to this point above?

In a similar way you can have ‘Labour would be cutting just £2bn less than us in 2011’ or you can have ‘Labour have no plan for he deficit and are wracking up spending commitments’. You can’t have both.

Yes, you can – pre-election, Labour specified the amount they’d cut, without specifying where those cuts would fall. Since then they’ve opposed practically every specific cut, making it hard to say they have a plan for cutting anything like that amount of public spending.

@16 – not controversial, but perhaps a bit more philosophical than political. I don’t think it’s wrong to claim credit for making a decision early if there are benefits to it, although I don’t think that’s the claim he was making. But either way it still falls down in requiring evidence to show that choosing to make cuts half the size would have resulted in cut of the same size being forced on whatever government by the IBV.

Incidentally, I was surprised by his including Ireland as one of the arm-twisted – weren’t Ireland’s initial cuts presented as entirely their (incredibly good and brave) choice?

@18

Sheffield and Manchester are cities with similar economies, similar budgets and similar sizes. They both are facing similar cuts in funding. The differences between the two of them are not big enough to explain why one is closing libraries and surestart centres while the other is not.

@20

The difference is that Lib Dem conference is sovereign on policy and MPs and leaders who defy conference can expect not to be reselected in 2015.

Conference approved the coalition agreement, not the add ons, which is why you can expect our MPs to obey the motion we also passed on the NHS and vote against Lanley’s proposals.

24. Planeshift

“The difference is that Lib Dem conference is sovereign on policy and MPs and leaders who defy conference can expect not to be reselected in 2015.”

Are there historical examples of this happening? Or will the leadership argue they tried their best internally to change policy, but failed?

25. Chaise Guevara

@ 19 Neil Baker

“@Chaise lol, who are you trying to kid? For months you’ve been riding the LD-hating bandwagon all over these pages.”

That is a lie.

“So how then can you say the cuts have nothing to do with who is in charge of each council, and then blame it all on the governing parties?”

Perhaps you should refer to the post you’re replying to, where I’ve already addressed this point? I’m not the one with reading difficulties, kid.

“I do not know whether to laugh or cry at your disingenuous position. Were you also excusing Labour councillors “doing their duty” by passing budget cuts on LC a few weeks ago? Probably.”

I was saying that they shouldn’t quit en masse if that’s what you mean. Why, what was your view on the matter?

26. Chaise Guevara

@ 23 George W Potter

“Sheffield and Manchester are cities with similar economies, similar budgets and similar sizes. They both are facing similar cuts in funding. The differences between the two of them are not big enough to explain why one is closing libraries and surestart centres while the other is not.”

What’s your explanation, then? Manchester was doing fine till the coalition budget. I don’t think it’s massively cynical to note with interest that a city run by a party in government seems to be doing better than one run by a party not in government.

The same cut in budget can have drastically different effects on different places, because there are always other factors. You can try to handwave this away by saying that Sheffield and Manchester – two enormous and unique cities – have “similar economies” all you like. The fact remains that just comparing absolute layoff numbers isn’t useful at all unless you can show where the Lib Dems applied more merciful policies than Labour.

In a similar way you can have ‘Labour would be cutting just £2bn less than us in 2011’ or you can have ‘Labour have no plan for he deficit and are wracking up spending commitments’. You can’t have both.

Yes you can. Labour set out an overall strategy of cutting the overal deficit by half in four years and they even set out the rough cost of doing so. What they didn’t do was specify how that cost would be met, beyond a rought 60/40 split between tax rises and spending cuts.

Since then they have opposed every specific cut and most of the specific tax rises. Meaning both that Labour have no plan for the deficit and that, were they in power, they would be introducing cuts/tax rises on a similar scale.

@24

I can’t recall any offhand, but the party constitution and structures makes it very ready to get rid of undesirables come the next election – assuming the party is suitably angry at being ignored of course.

@26

I can’t give you detailed examples at the moment as I’m using my phone but when I get home this evening I will.

29. Chaise Guevara

@ 28

Cool, fair enough. To clarify, I’m not looking to find reasons to demonise the LDs and praise Labour – I’ve historically supported the former rather than the latter. But there’s been some lazy and unreasonable stuff going around recently along the lines of “Labour are bastards because they implemented the budgets that were handed down by the government”, and obviously I’m not going to condemn Manchester Council on that basis alone.

30. Planeshift

“Since then they have opposed every specific cut and most of the specific tax rises.”

That isn’t entirely true is it? They’ve stated they’ll support most of IDS’s reforms to welfare, were split on fees before it became an opportunity for bandwagon jumping, and have specifically stated they would retain the banking levy.

30 – but are opposed to the VAT rise, which makes up the vast majority of new tax revenue. With the welfare reforms they’ve said they support it in principle, but oppose almost every individual aspect.

I’m not especially blaming them for this incidentally – opposition economic policy isn’t really supposed to be coherent this far out from an election, which is why I thought that Alan Johnson as shadow chancellor wasn’t such a bad choice as it turned out. As Bagehot points out, Ed Balls probably needs to adjust a bit.

Some 12 months after the last election, the job of the opposition is not to make voters regret their foolishness in rejecting the Labour party in 2010. The job of the opposition this early in a parliament, surely, is to tear chunks out of the sitting government, and not much else. The job of Mr Miliband is to sound vaguely prime ministerial, while hinting that Mr Cameron has no credibility, no heart, no shame or what have you. The job of Mr Balls, a clever and caustic man who knows his economics, should be to rip into Mr Osborne’s competence and attempt to spike the guns of his Budget with the aid of a brilliant, simple-but-telling soundbite defining the Tory’s plans before Mr Osborne has the chance to define them.

Instead, Mr Balls indulged what appears to be a boundless desire to justify his own record in office and to set out all the marvellous things he would be doing if only he were in charge right now, complete with thickets of statistics and cheering forecasts of spurious precision, in the grand Gordonian manner. The official Labour Party news release about the press conference is almost wholly devoted to lauding the Balls alternative plans, and carries the sub-heading:

£2billion bank bonus tax to create 110,000 new jobs
Memo to Mr Balls: you are not running the country any more.

More worryingly still for the Labour party, Mr Miliband indulged Mr Balls in this.

http://www.economist.com/blogs/bagehot/2011/03/ed_miliband

“Sheffield and Manchester are cities with similar economies, similar budgets and similar sizes. They both are facing similar cuts in funding.”

Nope.

Manchester is more deprived than Sheffield, because (a) the poorer parts of Manchester are worse off than the poorer parts of Sheffield, and (b) the most affluent bits of Sheffield are within the city boundaries, whereas the most affluent bits of Manchester are outside the city council boundaries in neighbouring authorities. This information from the “Closing the Gap” report of Sheffield City Council.

As a result of being more deprived, Manchester got bigger cuts than Sheffield. Sheffield had a budget gap of £80 million in 2011/12, Manchester had a budget gap of £109 million, even though approximately 60,000 more people live in the area which Sheffield City Council is responsible for than live in the area which Manchester City Council is responsible for.

Manchester City Council is cutting more frontline services than Sheffield City Council because it has lost £29 million more in funding, because the government decided to impose greater cuts on areas where more poor people live.

GWP @ 17

Perhaps it would interest you to know that one of the first things conference did last weekend was to pass a motion against cuts to DLA or the mobility allowance? I supported that motion so perhaps you would be kind enough to check to see how individuals acted before you start spewing bile at them.

No doubt the people who are losing wheelchairs and houses will be cheered at the prospect that your little talking shop have ‘passed a motion’ against the cuts in DLA. I suppose it is the equivalent of Labour’s ‘nuclear free zones’ circa 1983. Gesture politics at its worst. Sue Marsh has little need for ‘motions’. She requires actual help, as do countless others up and down the Country. What, real practical help can the Lib Dems give them? Right now the only thing standing between her famiy taking a real kicking is Nick Clegg. Will he let her down? George, I honestly do not think for one moment that you got into politics to hammer the sick and the poor into the ground, but you must accept that many of the people who you are in coalition with did. We both know that NOTHING they have done in Government has gone against their idealogy. Had there not been a deficit they would still be doing these things, because they believe they are the right thing. I cannot believe that the Lib Dem rank and filereally think that punishing the poor is the right thing to do. It cannot be right that those least able to help themselves are being driven into poverty while the super rich walk away Scott Free, can it?

The bottom line is this, though George. The Tories are quite content for you to play at ‘grown up politics’, but your ‘Party’ will be brought to heal quickly enough when push comes to shove. I have little interest in how your Party voted at a conference, the only thing that matters is how they act in Government. Once the DLA cut has been scrapped, you can tell us how effective your vote in spring conference was. Till then, fine gestures, but the parsnips remain unbuttered.

@33

I know this is often a difficult concept for Labourites to grasp, but the Lib Dems have a democratic internal structure. This means that we make policy, not the leadership. The ending of child detention for example, started life as a motion by an ordinary party member. This means that, even if our MPs have hearts of stone and were not moved by some of the cases described during the debate, they are still bound to vote as the motion requires. This makes us much more powerful than a ‘talking shop’.

DLA was not in the coalition agreement so they are free to vote against it without bringing down the government – unlike many perceived over tuition fees.

In addition to that, behind the scenes work has already limited the proposals to reducing, not scrapping, the mobility allowance. With the motion passed our MPs can now go back, follow their instincts and say: the party won’t stand for it, we can’t vote for these proposals. I imagine the same will happen on the NHS.

You are of course right that the vote in parliament hadn’t happened yet so we don’t know how MPs will vote. This is why I find it so remarkable that you spew bile at people who have nothing to do with the decision. Or perhaps I’m wrong and should be following your lead and holding you personally responsible for the Iraq War?

Hey, Potter, how about you answer the points in @32? Your assertion that Sheffield got the similar cuts to Manchester appear to have been challenged.

By the way, didn’t Lib Dem Conference reaffirm opposition to tuition fees (and increases to them) in 2009? What happened to their sovereign position in a democratic party after that?

Face it, Clegg and the MPs sold your party a pup. Fair enough, you got conned. But you keep going back for more, and insisting that you ended up with a great deal.

I will remind any Lib Dems who oppose local cuts that they are a result of Clegg’s ‘choices’.

GWP @ 34

A couple of points. First of all, I have never voted Labour in my life, but you do raise a serious point. Yes, any Labour Party activist who stood by the Party when the decision to go to war was taken has serious questions to ask themselves and can expect to be tackled either on the doorstep or in cyberspace on the subject. I would question any Labourite’s commitment to the Party at the time of the Iraq War.

Secondly, yes I am aware that the Lib Dems have, in theory, a fully democratic system. However, that system was designed at a time when you lived in splendid isolation. Let us see how that system holds up when Cameron and Osbourne start breathing down your necks. I mean, look how quickly Nick Caved (one for the teenagers there) on tuition fees. I make for the possibility that the Lib Dems will do a vote for Christmas move, you know that an early election after the coalition is split will leave you with a minibus of MPs. Your only real hope is that some of the credit for delivering a huge tax cut for the rich wipes off. The Lib Dems cannot afford to bring down the Tories because the coalition is the only thing keeping alive. Just saying.

I accept that you are merely a prospective council candidate and not Nick Clegg. I mean no offence by that George. You are an apologist for the coalition. To be honest, though, I am sorry if you feel my ire is aimed at you personally. My gripe is with the coalition, but you have stated that you are in broad agreement with the aims of the coalition. You have supported the tax burden being shifted further onto the backs of the poor. You have openly repeated the ‘poor out of taxation’ myth on more than a single occasion. I think if you were being honest, you would secretly concede that is an outright lie.

You say that Lib Dem MPs are somehow duty bound to vote on this, and all other matters based on how the Party have voted. I hope that they do, but from where I am sitting, very few appear to be speaking out. The few Lib Dems that show face here find it relatively difficult to condemn the type of decisions taken in the name of cuts. I have so far not heard of any Lib Dems take up the cudgels for the weak that are targeted by Cameron. To be fair, the Labour Party have been none to smart in getting onside either. However, given that the Parliamentary Labour Party are a bunch of spineless cretins, the bar is not set to high for that test is it? Yet the ‘dissenting Lib Dems are not exactly vocal in this.

George, almost every day the Tories appear to introduce more humiliation and dish out more punishment to the backs of people who can least fight back, yet the Lib Dems are silent. Why?

@29 and @35

I said I’d give a detailed account of Sheffield vs Manchester tonight but I am too tired to do so. I’ll try and do it tomorrow instead.

@34

I am personally very angry about tuition fees and I intend to do all I can to make Clegg and Co pay for that betrayal. However, in a lot of cases, such as those of Featherstone, our MPs voted in favour of the proposals because they saw it as an issue that would a) stop them from doing good work as ministers (at the time of the fees vote Featherstone was working on the equality legislation now being proposed by the government) and b) because they thought it would bring down the coalition. I think they made the wrong choice and that our ministers should have abstained whilst our backbenchers should have voted against. The problem stemmed from a serious lapse by the negotiating team and now we are rightly paying the price for it.

However, other matters, such as DLA and NHS reforms were not mentioned in the coalition agreement – in fact the agreement has a bit about an end to top down reorganisations of the NHS – our MPs will find it a lot easier to do as conference wishes and will have less of an excuse not to do so. If nothing else, you can expect the reforms to be radically altered by amendments and, if they still remain dangerous, I expect you will see a far bigger backbencher revolt on them than on fees. Don’t forget, some of the biggest names in our party are against the proposals (such as Shirley Williams) and, whilst I wouldn’t put it past Clegg and a few others to vote in favour of the Lansley proposals, I would be amazed if they made it through parliament. The same goes for the DLA proposals. Believe it or not, most tories are not heartless bastards and will probably be persuaded to drop the changes – on political grounds if nothing else.

“My gripe is with the coalition, but you have stated that you are in broad agreement with the aims of the coalition. You have supported the tax burden being shifted further onto the backs of the poor. You have openly repeated the ‘poor out of taxation’ myth on more than a single occasion. I think if you were being honest, you would secretly concede that is an outright lie.”

I am in broad agreement with the aims of the coalition, but that doesn’t mean that there aren’t certain areas where I vehemently disagree. If by “the tax burden being shifted further onto the backs of the poor” you mean “restoring the earnings link to pensions and taking the lowest paid people in the country out of tax” then yes I am. Quite simply, raising the threshold means giving back money to some of the poorest people in society. I would argue that this is a far better method than the previous government’s method of taxing people more and then making them fill in a form to get it back. Similarly, I back the broad aim of the benefits system reform – though again there are areas where I utterly disagree with it.

“I hope that they do, but from where I am sitting, very few appear to be speaking out. The few Lib Dems that show face here find it relatively difficult to condemn the type of decisions taken in the name of cuts. I have so far not heard of any Lib Dems take up the cudgels for the weak that are targeted by Cameron.”

Well unfortunately you’re not looking in the right places then. For one thing, there are an incredible number of behind the scenes battles over policy where the Lib Dems are winning big victories in limiting tory proposals (the forest sell off was one of these – though it took public pressure to persuade the tories of what the lib dems had been saying all along). However, it is party strategy not to disclose the details of these as the leadership has decided that it would be too damaging to the coalition. You will also find Lib Dem councillors standing up for the most vulnerable up and down the country – either by minimising the harm of the cuts or by fighting to persuade council administrations to change their minds. In Guildford, for example, we tried to urge the council to scrap it’s council newspaper and use the funds to reopen a centre for the elderly instead. They ignored us but if we get the four seats we need in May then we’ll be able to implement our counter budget proposal that would see no cuts to frontline services as a result of the cuts.

And this isn’t mentioning the many Lib Dem members and supporters who are taking part in many anti-cut campaigns. The difference is that, unlike some other parties, Lib Dems who take part in non-partisan campaigns tend to do so as themselves rather than under the Lib Dem label. This means that we don’t go to anti-cut protests waving Lib Dem banners alongside the SWP placards and it means that when we go to help out at the local save our library campaign we don’t see it as worth mentioning that we’re Lib Dems. But if you were to ask most Lib Dem members and activists what they are doing to oppose the unfair things the government are doing then the answer will probably be “a lot”.

If, however, you want a quick list of things the party nationally has been doing in the past few days you can look at these:

http://www.guardian.co.uk/law/2011/mar/14/lib-dems-human-rights-convention
http://www.libdemvoice.org/lynne-featherstone-launches-government-campaign-to-tackle-homophobia-in-sport-23440.html
http://www.libdemvoice.org/libel-reform-bill-published-23452.html

George @ 37

Some interesting points there, and I will look at your links, but I will judge the Lib Dems on what gets through rather than merely what we are told are ‘behind the scenes’ machinations. For me too many of the ‘coalition’ policy announcements have been scrawled onto the back of fag papers to appease the Daily Mail and when you look squarely at them, the simply fall to tatters. I presume that the Lib Dems are supposed to act as filter to remove some of the nuttier aspects of Tory ideology.

One thing your Party has definitely got wrong in my opinion is this ‘getting the working poor out of tax’. Of course, not a single person has been taken out of the tax system. We all pay VAT and no-one shells out more of their income on VAT than the poor (working or not working). The whole point of income tax is that it is a progressive tax therefore those on lowest incomes paid very little income tax. However, council tax is a pretty nasty form of regressive tax and really act s as a barrier to people taking on a lower paid job. The jump is far too high for many people and would more than wipe out any ‘gain’ (a couple of quid) in income tax in.

George, this aspect really puts me of any idea that the Lib Dems are anything other than Tory stooges. Despite all their mealy mouthed assertions that they are on the side of the poor and are ‘working behind the scenes to mitigate the worst of the Tories’ folly, they really have cocked this one up big time. I tend to use ‘Global Warming’ as a bell weather against which I measure people’s ideology. Well we can measure this for people’s ideology as well. Show me someone who thinks cutting income tax whilst increasing regressive tax and I will show you someone whose priorities are not about helping the poor. The fact that Osborne could find (from memory, correct me if I am wrong) 3.6 billion to cut taxes for ‘the poor’ says it all really. I wonder how much of that 3.6 billion went to the poor? All you really achieved was shift the balance, from progressive to regressive taxation which is what the Tories have been steadily been doing for the last thirty years.

Had that 3.6 billion been used to take ‘the poor’ out of Council tax, then you may have a point, but no Tory chancellor would have bought that, would they?

The Lib Dems had proposals to replace Council tax with a local income in Scotland. A move that would have really taken tens of thousands out of tax, after an election you didn’t win. You couldn’t support that, but you could support a VAT rise. Who is being helped by cutting by that?

“However, council tax is a pretty nasty form of regressive tax and really act s as a barrier to people taking on a lower paid job. The jump is far too high for many people and would more than wipe out any ‘gain’ (a couple of quid) in income tax in.”

And worth noting the Lib Dem/Tory plans to “localise” council tax benefit to local authorities. They are going to pass responsibility for assessing council tax benefit to local authorities, let them set their own criteria for eligibility. Oh, and cut the overall budget by 10%.

So local councils get to choose whether to increase the number of people on low incomes who pay council tax, or whether to cut services further in order to maintain financial support for poor people. I guess at least giving Tory councillors the power to decide how best to take money away for poor people in order to save money will give them something to do once they’ve closed all the libraries.

They’ve even weighted the cuts so that the areas which lose the most money per household are prosperous places like Haringey, Hackney, Hartlepool and Liverpool (which each get a funding cut of £28 per household or more), whereas the poverty-stricken stockbrokers of City of London, rural Hampshire, Wokingham and Ribble Valley get a funding cut of less than £10 per household.

It’s a long way from “Axe the Council Tax”.

Don @ 39

All of which neatly illustrates this ‘taking people out of tax myth’ needs to be shot down at every opportunity. I am not sure if poor old George has been merely taken in by this piece of nonsense, or he really is a conspirator in all this. I think we could forgive him a bit of ignorance in this. We may be able to pass this off as a blind spot, or perhaps he is attempting to gain a bit of comfort in being sold a pup of a policy and has convinced himself that cutting progressive tax has actually helped the poor.

However, there is simply no excuse for those in Westminster. They surely have access to the figures and can crunch the numbers. There is simply no way that Clegg can be blind to what is really going on in Government. He must know that this ‘tax removal’ (for want of a better phrase) is a complete lie and a pretty hollow joke, surely not even fifty cent would tweet such a sick remark? The poorest in society are expected to shoulder the tax burden and people like George are either to uninformed, completely smitten or just straightforward liars in this respect.

I have to be honest here, I have not read, seen or heard a single Lib Dem show any disquiet about this. Perhaps I have not been looking in the right places, but surely a criticism of such a glaringly obvious policy failure would make headline news?

@Jim

The logic behind the income tax threshold increase is as follows: at the moment, anyone above the threshold pays 20% tax, and the poorer people in society then need to claim it back in the form of various benefits and the like. By raising the tax threshold to £10,000 (which won’t fully happen until the end of the parliament) a lot of those people are taken out of tax altogether. Yes, the wealthier benefit from it a bit as well, but it’s a far smaller proportion of their income than it is for those at the bottom of the scale. The Lib Dem principle is that nobody should be taxed on the bare minimum they need to survive and then be forced to claim back what they need through a complicated bureaucratic exercise. Instead you aim to take them out of tax completely – which is why I favour increasing the threshold to £14,000.

As for VAT, it’s a tax rise. That means that everyone pays more. The difference being that the richer will pay more VAT whereas the poorer will pay less. This is because many everyday necessities are VAT free whilst nearly all the luxury items the rich spend money on are VAT liable. This makes it a progressive tax – as the IFS agreed – because the rich pay more and that money can then be spent on other areas which will mainly benefit the poor. However, if you look at it as a proportion of income (something which is not taken into account in the traditional definition of “progressive”) then it is indeed a regressive tax. This is why I happen to disagree with the increase in VAT – because if you look at it as a proportion of income the poor pay more. That’s why, if I’d been in charge I would probably have increased the number of exempt goods to include things like toilet paper so that all day to day essentials were exempt – thereby allowing the tax increase to be more progressive than it is at the moment.

But you’re indulging in a logical fallacy by attempting to use two definitions of progressive simultaneously. Either you look at proportion of income and say that the tax threshold increase is progressive, while the VAT increase is regressive, or you look at the actual amount paid and conclude that the threshold increase is regressive while the VAT increase is progressive. I don’t mind you adopting either position but don’t you dare sit there and use completely different measure of progressiveness only as they suit the political point you want to make.

As for council tax, we as a party support replacing it with a local income tax, and a Lib Dem government would implement that change. Unfortunately the electorate voted for a coalition government so that’s what we’ve got. And you know as well as I do that the tories would never vote for such a measure.

As it is we have to content ourselves with libel reform, restoring civil liberties, constitutional reform and restoring the earning link to pensions. I don’t agree with everything this government is doing and where I can I’ll oppose it, but overall I support it over the alternatives. You may disagree with this position, and that’s fine. I don’t expect everyone to agree with me. But it just shows the pettiness of your argument that you have made up your mind that I am either an uninformed dupe or a lying conspirator. Quite frankly, if you’ve already made up your mind to that extent then I don’t see why you even bother to debate – you’re not going to change your opinion one iota no matter what I say.

@George – do you want to/do you know someone who can do an article for us on libel reform? Keen to cover today’s announcement.

On the council tax, I’m actually quite surprised that the Lib Dems have gone along with the proposals to cut council tax benefit by 10%. This is explicitly targeted at saving money by increasing council tax bills for people on low incomes, which seems to me to be against everything the Lib Dems stand for – is there any likelihood of a grassroots revolt on it?

43. Planeshift

“So local councils get to choose whether to increase the number of people on low incomes who pay council tax, or whether to cut services further in order to maintain financial support for poor people”

Hmmm, as local authorities recieve council tax benefit direct, plus an admin fee for administration of it, surely the incentive is to increase council tax by as much as possible for people in reciept of it, and get the DWP to pay.

Either way, Council Tax should be priority number 1 on the scrap list. That most tories prefer to winge about inheritance tax says a great deal about their real commitment to reducing taxes.

@38

Of course, not a single person has been taken out of the tax system. We all pay VAT and no-one shells out more of their income on VAT than the poor (working or not working). The whole point of income tax is that it is a progressive tax therefore those on lowest incomes paid very little income tax.

Yes, and increasing the personal allowance makes it quite significantly more progressive. I don’t understand your problem with this? It’s certainly more progressive than diverting the same volume of tax cuts to keeping VAT lower, which seems to be what you favour.

“Hmmm, as local authorities recieve council tax benefit direct, plus an admin fee for administration of it, surely the incentive is to increase council tax by as much as possible for people in reciept of it”

Except that local authorities can’t do this at the moment, because all they can do is set an overall level. They can’t, for example, decide that no one on JSA should be eligible for council tax benefit in order to discourage “worklessness”, or that only the deserving poor should get council tax benefit, or any of the other things which would result from councils setting their own criteria.

@42

I don’t know anyone offhand, however, if you have a look at:

http://www.libdemvoice.org/libel-reform-bill-published-23452.html

You could probably either crosspost it or, failing that, use the sources it uses to quickly put together something that is mostly extracts from other articles. I know that the campaign for liberl reform put out a press statement on it.

@26 and others

Here’s a detailed comparison of Sheffield and Manchester and the cuts they are making. All figures are accurate and come either from the councils or local newspapers or the BBC.

http://thepotterblogger.blogspot.com/2011/03/tale-of-two-councils.html

Tom Ash @ 44, GWP @ 41

There are a couple of obvious issues with merely raising the tax-free allowance as far as I can see. First of all, doing this at the same time as you are increasing VAT is an idealistic move. George Osborne could have raised income tax, but there would a political price to pay, both in terms of short-term electoral/poll wobbles and it would upset the ideological purists within the Party.

Secondly it does not really address the ‘stated’ aim of the policy. If your stated aim is to ‘help the poor’, then income tax tweaks are hardly the best way to go about it. Obviously, by definition, the term ‘the low paid’ relates to a minority of people, depending on how you define it, but a tax allowance raise, goes to everybody on the standard tax rate. If your aim is to ‘cut income tax for everyone’ then fair enough, but this is being sold as a move to help the poor. Giving ‘everyone on the basic rate’ an extra tax free allowance of twenty quid in the understanding that some of that will go to the relatively poor, but most will go to people better off hardly seems fair, if you are attempting to sell this as a move to help the poorest workers in our society. If we had (from memory) 3.6 billion quid to spend ‘on the poor’ at the last budget, giving most of that to people well off does not appear an efficient use of that money to me.

The tax credit system is far from perfect and has a few flaws, but at least we can target the money to the people the GoTD feel deserve it. We can target people with kids, on part time hours or any sensible criteria we want. Giving a tenner week to the breadwinner of a family of three children on the minimum wage and a guy living with his mum, earning twenty-two grand a year is not getting the job done in my view, especially if we then increase the tax burden of the family of three that more than wipes out that tenner or close services that the family use to pay for the boy racer’s ten quid into the bargin.

Far better, in my view, to put that 3.6 billion towards a system to remove the lowest paid workers from Council Tax.

How can Clegg say that the lib dems will never lose their soul?

Nobody trusts him on anything. He says one thing before the election, and then does a 180 degree spin and pretends that it does not matter.

I suppose if you never had a soul…………………. you can’t lose it.

GWP @ 41

As for council tax, we as a party support replacing it with a local income tax, and a Lib Dem government would implement that change. Unfortunately the electorate voted for a coalition government so that’s what we’ve got. And you know as well as I do that the tories would never vote for such a measure.

Good news on that front, George! The SNP also favoured replacing Council Tax with a local income tax, and, as you know formed a minority Government. Unfortunately, when they tried to solicit support for this policy, as you rightly point out, the Tories, being Tories came out firmly against it. The Labour Party, being spineless bastards, said they would vote it down too. The Lib Dems looked at the policy that is almost identical to their own policy and, and…
…well you can guess the rest. Suffice to say, we do not have a local income tax despite the electorate voting in a majority of parties who stood on that very platform!

George, since the early eighties when I first became eligible to vote I have voted, in various local, National and European elections SDP, Liberal, SDP/Liberal alliance, Liberal Democrat. However, although I voted SNP at the 2007 election, this was the election that meant I would be unlikely to vote Lib Dem again. The Lib Dems walked away from a policy, just because it didn’t suit them in the short term. This was exactly what I understood the term ‘Coalition’ to be, yet they were willing to sacrifice the poorest people in Scotland to maintain some kind of political purity.

My gut instinct was proved correct, when four years later the same group of people, now in a Nationwide context are still being sacrificed, but for selfish reasons.

@50

The reason for Lib Dem opposition in Scotland was apparently because the SNP wanted a flat rate of tax across the whole country whilst the Liberal Democrats wanted councils to be able to set their own tax levels.

According to the BBC:

“The Lib Dems said they wanted individual councils to be able to vary local income tax, as opposed to the SNP’s fixed 3p levy across Scotland.”

This makes sense to me because a 3p flat rate tax is unprogressive and would probably result in a cut in funding to poorer councils. Councils should be able to vary the rate to make it progressive and to suit their local needs. Otherwise you might as well raise taxes nationally and then fund councils entirely through a block grant.

Further to my last post:

“A local income tax of 3p, much lower than the experts’ recommendation of 5p or more, would cost the Scottish government £500m a year extra in direct subsidies to Scotland’s 32 councils. But under the Barnett formula, the UK Treasury mechanism for adjusting public expenditure in Scotland, Northern Ireland and Wales, Scotland’s grant from the Treasury would be cut by up to £1bn over the coming two financial years, Swinney said.”

GWP @ 51

To be fair to the SNP, though George, the Scottish Parliament’s tax ‘varying’ powers was limited at 3%. The other stumbling block, if I remember correctly, was that the treasury was unwilling to transfer monies allocated to the Council Tax rebates to help fund the shortfall.

I do concede that there where some discrepancies between the SNP proposal and the Lib Dems’ apparent policy. I cannot believe however, that what the SNP’s proposal had and the de facto Lib Dem policy would have been miles apart. Surely the Lib Dem policy would, if put into place, look very much like the SNP one at the time. I cannot seriously believe that vast difference in local income tax would manifest itself.

Anyway, I think that the differences in the two policies shrink into insignificance compared to the vast compromises undertaken to accommodate your Party getting into bed with the Tories, say, with regard to scrapping tuition fees. If your Party could not support a local income tax because it wasn’t perfect, then how on Earth you your party possibly support tuition fee being trebled?

George – Sheffield council say they have to make 80 million cuts, you say 98 million?

@54

I found about three different figures for Sheffield in different documents. I got the £98m figure by adding together the specific cuts they mentioned in each area. However, if I’m wrong then I do apologise though I think the basic argument still stands.If I get the chance tomorrow I’ll check the figures but I really don’t want to have to spend hours going through council documents again.

“If your Party could not support a local income tax because it wasn’t perfect, then how on Earth you your party possibly support tuition fee being trebled?”

To answer your question in part, I find that the scottish lib dems tend to be more principled than the rest of us but mainly I still don’t know the answer to that myself.

“By cutting the deficit decisively we have restored confidence in Britain”

Sorry Nick, that’s just not true. Actually you’ve had a pretty severe negative effect on it:

http://krugman.blogs.nytimes.com/2011/03/03/in-search-of-the-confidence-fairy/

Bond yields were never on the rise and your budget had little to no effect on them:

http://4.bp.blogspot.com/_TAM6pE-50TM/S8TIBNcB9wI/AAAAAAAAAWw/y-6jIph-nlA/s1600/100414-1.jpg

If anybody still believes that the country is ‘on the brink of bankruptcy’, please read here:

http://www.tmmblog.co.uk/?p=1627

Shame that nothing this government does is supported by the evidence.


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