Conservative Manifesto 2010: inheritance tax, crime & unemployment
FactCheck checks it out
FactCheck thought we had a hard day yesterday working on the Labour Manifesto but when 120 pages of the Conservative manifesto dropped in our inboxes we stopped what we were doing and got to work.
The analysis
“And we will raise the inheritance tax threshold to £1m to help millions of people who aspire to pass something on to their children, paid for by a simple flat-rate levy on all non-domiciled individuals.”
Millions of people may well aspire to pass riches on to their children – but how many of them would actually be helped by the Tories’ policy to raise the inheritance tax threshold to £1m?
The Treasury estimates a grand total of 11,000 estates would benefit from the increased threshold – 8,000 of them worth up to £1m and 3,000 worth over £1m.
So far short of the millions the Tories suggest. But how about whether the cost of the tax relief will be covered by a simple flat-rate tax on non-doms?
Labour claims the Tories’ new tax on these wealthy people with links abroad won’t bring in the required amount of cash. The most recent information we’ve FactChecked suggested Labour might be on the right lines – but frankly there is so much uncertainty around the tax that we just can’t say whose sums add up.
Update: In response, a Conservative party spokesman directed us towards a letter written by the Shadow chief secretary to the Treasury, Philip Hammond, last December (for more read here).
“Under Labour, youth unemployment has reached over 900,000, with one in five young people unable to find a job.”
The latest statistical summary from the ONS headlines youth unemployment as that affecting 18-24 year-olds, of whom there are 715,000. However, if you look at the figure for 16-24-year-olds (and there’s no reason why you shouldn’t) it’s 200,000 higher, backing up the Tories’ claim.
But, but, but. Contained within the 915,000 young unemployed are more than a quarter of a million full-time students. They’re included on this measure of unemployment because they are actively looking for, but say they haven’t been able to find, work. If they were excluded, the 16-24-year-old unemployed total would instead be 653,000.
Nothing wrong with the Tories quoting the higher figure. But when you think of young people languishing without work, a student who can’t find a part-time job isn’t perhaps what you’d have in mind.
It’s also worth remembering – as the Conservatives yesterday promoted a poster with a picture of Gordon Brown saying “I caused record youth unemployment” at Labour’s manifesto launch – that comparable youth unemployment figures only go back to 1992. So although the high youth jobless tally is nothing for Labour to be proud of, the “record” excludes much of the recession counts under the last Tory administration.
“Recorded violent crime against the person has risen sharply under Labour”
The two main sets of violent crime statistics show completely opposite trends.
In the blue corner, recorded crime figures – which are affected by changes in the way crimes are counted by the police – do show a rise. But in the red corner, the British Crime Survey, which asks people about their experiences of crime, shows violent offences have in fact decreased by more than 40 per cent.
This is politics, you can’t really blame the Tories from only quoting the statistics that are most useful to them…except they’ve been, specifically, warned not to by the head of the UK Statistics Authority.
The stats watchdog has set out clearly that it believes the British Crime Survey is the best measure of long-term trends in violent crime. “We regard a comparison, without qualification, of police recorded statistics between the late 1990s and 2008/09 as likely to mislead the public,” Sir Michael Scholar wrote to Shadow Home Secretary Chris Grayling earlier this year, after he made similar claims based on recorded violent crime figures.
“We will act immediately to cut government waste so we can stop the most damaging part of the National Insurance rise for employers and for anyone earning under £35,000.”
As you might expect, the first section of the Tory manifesto repeats many of those arguments for cutting waste to fund the National Insurance rise that have been filling newspapers for the last couple of weeks.
The Tories believe that they can cut an extra £12bn in this financial year, £6bn of which will go to pay down the bulging UK deficit, they say. These cuts, and more which they will find when in government, will also fund their pledge to block the planned rise in national insurance next year.
Not possible, say Labour, who refer to £15bn efficiency savings they’ve already put in motion for this year, adding that it is not credible that the Tories could increase this to £27bn.
Oh yes it is, say the Conservatives – two government efficiency gurus’ say we can. But the details of exactly where these savings will come from are scarce, although some are emerging slowly. And, as the Institute for Fiscal Studies pointed out when the government mentioned efficiencies in the budget, they can be elusive and difficult to measure.
So in the end it is almost impossible for us to really judge whether the Conservative targets are possible, whether cuts will be more painful or whether they leave the party with a big black hole when it comes to funding that NI pledge until there is more detail.
And, as the IFS concluded on the policy before: “The Conservatives claim that the spending cuts can, in effect, be rendered painless by efficiency savings that they say their advisers have identified. Whether or not that is true, using the bulk of these spending cuts to finance the NI cut means that they are not available to contribute to the task of reducing government borrowing that the Conservatives have set such store by.”
“We will implement the Prisoners Earnings Act 1996 to allow deductions from the earnings of prisoners in properly paid work to be paid into the victims fund. We will use this fund to deliver up to 15 new rape crisis centres and give existing rape crisis centres stable, long-term funding.”
The act was introduced back in John Major’s time, to allow prisons to take things like income tax and national insurance from money earned by prisoners.
However, it was never put into force – because the government reckoned that, far from raising enough cash to fund rape crisis centres, it would end up costing more money overall.
“The act is complicated and prescriptive and it is calculated that in its present form it would cost substantially more to administer than it would raise in revenue,” parliament was told last time the Conservatives tabled a question on it, in 2008.
The Prison Service told a Scottish parliamentary committee in 2004 that, despite a lot of effort on its part, “contracts for work, which would pay the revenue necessary to support the scheme, have not been easy to obtain”.
The Conservatives point out that the rape crisis funding pledge relates to a wider victims’ fund, which would include money already being raised from fines, as well as money from the Prisoners’ Earnings Act. But would it raise extra money?
The Tories think so – they gave us two examples of successful prison work projects and dismissed the suggestion the act was complicated and prescriptive as “an excuse for inaction by ministers who were unwilling to bring this legislation, passed by the last Conservative government shortly before the 1997 election, into force”.
“Thirteen years ago, Britain’s tax system was one of the most competitive in the developed world. Over the last decade, other countries have cut their tax rates while our tax system has become one of the most complex in the world. Our competitiveness rating has fallen, while the burden of regulation and the impact of taxation have risen.”
These claims put together paint a bleak picture of the attraction of the UK to the corporate world, but they may not paint the whole picture.
It is true that the United Kingdom’s competitiveness rating has slipped from 7th to 13th out of 133 over the last 13 years, according to the World Economic Forum’s Global Competitiveness Report.
But the UK is still above France (16) and Italy (48) from the G7 and above all the remaining G20 countries outside the G7 including China (29), India (49) and Australia (15).
It is also true to say that, according to KPMG’s Global Corporate and Indirect Tax Rate Survey the UK had the 11th lowest corporation tax in 1997, but is the 23rd lowest in 2009.
And it is true that other countries have cut their corporation tax, with four of the seven countries that jumped ahead of the UK in the competitiveness ratings cutting by more than 9 per cent.
But Britain has also cut its corporation tax rate by three per cent since 1999. This may not seem a lot compared to a 28 per cent fall in Germany, but their corporation tax rates started so much higher that in 2009 it was still just above ours at 29.44 per cent.
As a sample, of the 12 countries above the UK in the competitiveness ranking the Conservatives quote, seven of the 12 cut their interest rates by more than the UK, six of the 12 had higher corporation taxes in 1997 and four of them still do.
“One in six children in the UK now lives in a workless household – the highest proportion of any country in Europe.”
True, according to European statistics. The latest figures available are for 2008 and show that 16.4 per cent of children in the UK live in a workless household, the highest figure in Europe.
But this figure has fallen from 18.9 per cent in 1997, or one in five children. And, as FactCheck found in 2007, this does not take into account the social differences such as the number of lone parent families in the UK, which the Office for National Statistics calculated to be 12 per cent of UK households in 2009.
“Despite three White Papers, a multitude of strategies and endless new announcements, the UK now gets more of its energy from fossil fuels than it did in 1997.”
The most up to date figures showing our fossil fuel reliance are for 2008, and they don’t include shipping or aviation .
While the amount of energy generated by renewable sources has risen from 2.3914MWe (megawatt electrical) in 1997 to 6.8031MWe in 1998, it is dwarfed by the continuing rise in our use of fossil fuels.
As a result, our fossil fuel dependency has risen from 88.3 per cent in 1997 to 91.5 per cent in 2008.
“We have the worst record of any major EU nation when it comes to renewable energy.”
The UK was at the bottom of the EU league table for renewables in 2005, ahead of only Malta and Luxembourg, according to the European Wind Energy Association.
The table published last month says that back in 2005, renewable energy made up only 1.3 per cent compared with top performer Sweden, which generates nearly two fifths of its energy from renewable sources. But the same table backs the UK to reach its target of generating 15 per cent of renewable energy by 2020, unlike stronger performers including Denmark and Italy.
It is worth remembering that the 1.3 per cent figure is five years old and the 2008 results show improvement with 2.4 per cent of energy coming from renewables. Environmentalists suspect that the figures for 2009 and 2010 may show more dramatic progress towards the 15 per cent target. However no EU wide figures for 2008 or later are available for comparison.
The verdict
There is more than one way to skin a cat, so the saying goes. Equally, there is more than one way to read a set of statistics.
As you may expect, the Tories have used those statistics to their advantage but they really shouldn’t be repeating the crime stats after their ticking off by the Statistics Authority. And while millions may aspire to pass something on to their kids, at the moment, very few will actually be able to do so.
But, in other areas – like renewables and fossil fuels – they’ve been spot on.


There are 20 comments on this post
How are the Tories allowed to get away with the misrepresentation of these figures!
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if the torys had not driven our coal industry into the ground we would not have to import fossil fuels, same with railways if left nationalised there would be cheaper better service and with steel from the best maufacturers in the world to having to buy it at inflated prices cameron is trying to be like republicans in usa and look at the mess they are in he could not lie strait in bed
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Peter it is a pity your history is awry.The Unions led by the arch socialist Arthur Scargill led the coal miners and mines into obscurity, and now it is the Labour party seeking to do away with coal fired power stations in the interest of a so called green economy.The state could not run the railways ,except at an unaffordable loss,and yet again the unions made its demise even more certain.As for steel , yet again it priced itself out of the market.We still manufacture specialist steel but it is virtually deuniomised .Do not blame tories nor particularly Labour for the demise of these industries except for Labours affiliation with the unions and therefore their inability to stand up against them .You only have to look at BA now and probably the railways again.Unions pretend they are protecting jobs yet they have destroyed more jobs and industries than any government.
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1) “This is politics, you can’t really blame the Tories from only quoting the statistics that are most useful to them…except they’ve been, specifically, warned not to by the head of the UK Statistics Authority.”
So why can’t you blame them for not telling the whole truth?
2) “As you may expect, the Tories have used those statistics to their advantage but they really shouldn’t be repeating the crime stats after their ticking off by the Statistics Authority. And while millions may aspire to pass something on to their kids, at the moment, very few will actually be able to do so.”
So they are being dishonest!
“But, in other areas – like renewables and fossil fuels – they’ve been spot on.”
So that is OK then! If they give a couple of correct statistics, (but even then not the whole truth, as you point out.) then Tory Party dishonesty seems acceptable to you.
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Most impressive analysis; you’ve done a fantastic amount of work and succeeded in sorting the wheat from the chaff. Thank you for this serious contribution to the election merry-go-round.
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Thank you for this serious contribution to the election merry-go-round.
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The students looking ofr a part-time job are doing so because they have to pay towards their education, which costs put a severe strain on poorer families. If a part-time job is essential to allow the continuation, then the Conservatives use of the higher youth unemployment figure is completely justified, To those who work in higher education, or have supported the fruit of their loins through higher education, or who have the frustration of nor being able to help their child aspire, a student looking for part-time work is EXACTLY what comes to mind.
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Do you know Cathy the opposing figures from each party are meaningless .It all boils down to who you trust to run the economy and who will remove state taxation and state interference .Labour has proved over 13 years it fails on those3 factors , so why should they improve in the next 5 years ,It truly is time for a change.
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The trouble with manifesto announcements ,the elephant in the room is never mentioned, and in the case of the Tories, the FOX.
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Perhaps the Treasury should do its sums again. When Darling announced that IHT would stay at £325k rather than increase to £350k, the Treasury estimated that over 3 years that would bring in £440m. If we assume that as a lowest case all estates caught by IHT are paying an extra 40% of £25,000, or £10,000 each that comes to 44,000 estates over the three years. Of course, if you consider that nearly 40% of all homes in London are worth over £325k, and over 15% across England & Wales (data estimated from Land Registry sales), it’s easy to see that many more will benefit over time – indeed, millions. It’s also worth understanding that BENEFICIARIES are the ones who benefit from a reduced tax – and there are many more of them than there are estates. People who are dead simply benefit from a decent burial.
When discussing the British Crime Survey, you (and Sir Michael Scholar) should point out that it excludes crime against those under 16 and murders (dead victims aren’t surveyed!). Crime against under 16s has certainly been news, and could account for a good part of the difference in the measures.
Renewables remain small. Go here:
http://www.bmreports.com/bsp/bsp_home.htm
and you find that wind provided just 0.4% of our power in the last 24 hours with another 0.7% from hydro. Factor oil and gas use, and it’s tiny. 15% by 2020? I doubt it.
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“The Treasury estimates a grand total of 11,000 estates would benefit from the increased threshold – 8,000 of them worth up to £1m and 3,000 worth over £1m.”
This statement is meaningless because it lacks a specified period of time. If it only relates to deaths within a one year period then the figure of 11,000 is at least one order of magnitude lower than the true number of existing estates that would eventually benefit. Nevertheless a revised figure still falls far short even of one million. The reason that so few would benefit is that we live in a spendthrift culture and a nanny state; those who have sought to be self-reliant, live frugally and have savings are not responsible for the current economic mess.
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Further statistics on IHT here:
http://www.hmrc.gov.uk/stats/inheritance_tax/table12-3-iht-sept09.pdf
This shows that there were 2,865+19,396+8,752 = 31,013 estates that were taxed in 2006/7 where the estate was worth less than £1m. Perhaps the Treasury should talk to HMRC before it issues any more false statistics?
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Would it not be fair to point out, vis-a-vis Labour’s record on renewable energy, that most of the opposition to land-based wind farms has come from Conservative local councils? (http://www.lgcplus.com/lgc-news/environment/tories-criticised-over-wind-farm-refusals/5004448.article – sorry, I couldn’t find the primary source.)
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Good work guys and gals. As your analysis of Labour and Conservative manifestos has shown this election will be fought on tweaked statistics, partisan presentation, non-comparisons and semantic fuzzy logic if the major parties have their way. Thanks for shining a little light on their murky world.
Typically Tory to see the crime figures skewed despite warnings, the specifics of revenue raising dodged, the workless household with children figure mis-represented, and the over-claim for inheritance taking a few thousand up to ‘millions’. I think it illustrates that despite the caring, cuddling rhetoric of Call-Me-Dave, they Tories really don’t know how the other half live.
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David Cameron wants to make the rich richer! It appears that the Tories will not only increase the IHT limit to £1M but they will also permit the £1M allowance to be transfered to spouses so in fact Tory policy will in many cases result in many death estates valued up to £2M escaping the IHT tax altogether! Increasing Tory Tax Breaks for he rich won’t help reduce the governments budget deficit & will only increase the overall tax burden for ordinary hard working families. It appears that voting Tory will only help the rich get even richer!
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Marvellous! Had a little browse on all the political parties’ websites and think these chaps have the right ideas!
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The fossil fuel dependency figures do not factor in the massive reduction in nuclear power generation. Fossil fuel usage increased by 2.8% from 88.1% 1997 of total usage to 91.5% in 2008. At the same time nuclear power usage dropped by 48.5% from 10.2% of total usage in 1997 to 5.3% in 2008. Given those figures the tilt toward fossil fuels is the inevitable short term result of moving away nuclear power.
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Something got to be done, these people surely can’t be allowed to get into power.
They are lieing through their teeth already, god help us, how bad is it going to get.
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David Cameron talks…and talks…and talks…and talks…and says absolutely nothing because he doesn’t want us know what we’re in for should he win.
It’s quite possible he could continue with his vacuous speeches on ”TIME FOR A CHANGE’ right up to election day when he could be given the keys to number ten, then we’ll discover what his plans are, and if the few polices we already know about are an indication, it will be to form a government with a hard right agenda
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TBH my favourite was the Gordon Brown figure of 3000 people being helped by the tory inheritance tax threshold rise. OK, I’ll spell this out for that idot, and the treasury monkeys who can’t count…PROPERTY!! It’s estates worth UP to 1 mil. Not over it. Even using his own figures, he still misquoted badly.according to treasury figures It’s 3000 estates over 1 mil. they’re benefited, but not as much as everyone up to the threshold. here’s another figure, from the telegraph
Number of millionaires in Britain halves
The number of millionaires in Britain has halved amid the recession to less than 250,000, according to new figures.
so do none of these people have anyone to give it to? not even a cat or a hospital? Are they all buried holding their money in their favourite suit? So…conservatively replace the figure 3000 in browns speeches with 250 000 (using his lack of ability to grasp figures) fora realistic figure, use: everyone in the country with a will and property and/or wealth worth over 100 000. simple.
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