Tonight:
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SUCH is the pace of the grim economic news, with today's poor retail figures for last month and bad jobless figures expected, that all three major parties are now competing to offer an economic stimulant which until recently they shied away from: tax cuts.
In his monthly conference today, the Prime Minister talked of the importance of a “fiscal stimulus” for the economy, co-ordinated with other countries — in other words, tax cuts. Meanwhile, David Cameron has outlined the Tories' plans for tax cuts to boost employment, focused on reducing the national insurance costs to business in taking on unemployed workers. He insists that this would be funded by reducing the costs of unemployment and would not, accordingly, be fiscally irresponsible.
It is a good tactic for Mr Brown to try to outflank the Conservatives by cutting taxes, a remarkable reversal in a man keener on tax-and-spend than tax cuts. His approach to the financial crisis is already paying political dividends: the Tories' poll lead is now reduced to six points. It is also true that as an economic stimulus, tax cuts go straight to voters' pockets without the distortions involved in big spending projects.
However, Mr Brown is laying himself open to the charge of bribing voters with borrowed money, at a time when the economy is already debt-laden.
Meanwhile, the challenge for the Tories is that voters may be perfectly willing to be bribed.
Inevitably, the loss in revenue involved will have to be paid for by raising taxes elsewhere, by spending cuts or by borrowing.The Lib-Dems can take credit for seeking personal tax cuts early on and for trying to make clear how they would be funded — chiefly by closing fiscal loopholes.
The Government wants an increase in borrowing which, in his speech last night, Mr Brown optimistically described as “temporary and affordable”. He has now raised expectations for bigger tax reductions. The stakes for the pre-Budget report have just got much higher.
Unforgivable
Eight years ago, after the killing of Victoria Climbié following sustained abuse that social workers failed to address, we were told that the lessons had been learned by local authorities: such things were now less likely to happen again. But they have, and in the same London borough, Haringey.
Last August, a little boy aged 17 months was killed as a result of sustained neglect and abuse. During his short life he was “treated as a punchbag”, starved and left to die with a broken spine. A more wretched life and death can hardly be imagined. Today, his mother's boyfriend has been found guilty of “causing or allowing the death” of the child and so was Jason Owen, a guest in the house; his mother pleaded guilty to the same charge.
But it is not just the perpetrators of cruelty against the child on whom attention will now be focused. The spotlight will also fall on the social workers in Haringey who ignored or missed signs of abuse and neglect since he was a few months old. Doctors who saw the child behaved correctly. But social services allowed the child to stay with his mother even after concerns were raised and notwithstanding repeated visits by health visitors and care workers, as well as after the baby was put on the child protection register, and after the police were repeatedly involved in the case — and indeed after the child's temporary removal from his mother.
We will, no doubt, be told that there have been systemic and institutional failures in Haringey's social services department. That may be true. But individuals failed: they should be brought to account.
Remembering ...
THE FALLEN. The country is silent for two minutes today for a momentous anniversary, the 90th anniversary of the Armistice which brought an end to the First World War. Three survivors will be present at the Cenotaph today. The terrible sacrifices of that generation deserve our heartfelt recognition.
Reader views (1)
The problem with the argument on taxation is the law of unintended (but easily predicted) consequences and the use of sloppy terminology. Who are the "rich" to be taxed under LibDem plans? Anyone who earns more than you or I do?! How much do they earn? And what might these "rich" people do if they are burdened with greater taxes? Move their businesses and money elsewhere? And if they do and the tax take goes down, what then? The other problem is that some of the suggestions would be almost impossible under EU law - the talk of reducing VAT is a nonsense because the tax is an EU tax and we may not alter it without permission from our government in Brussels. No-string 'derogations' are almost impossible to agree now and come at a price - "yes you can do this for a short period but we want the following in exchange" (usually a surrender of something of far far greater value). Why will commentators not be clear about these things, rather than just reporting some wizard wheeze dreamed up to capture a headline? Surely the real headlines should sometimes say "daft group of economic illiterates come up with barmy idea that would be illegal" (same number of characters as one headline about the VAT suggestion in newspapers at the weekend...).
- Damian Hockney, London, UK, 11/11/2008 12:15
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