The Axeman Cometh – and now for the poor too.
The Spending Review leaks are coming thick and fast, coupled with a few choice hints from ministers. The coalition is proving masterful at manipulating the story. It now seems certain the Spending Review on Wednesday will involve dramatic and deep cuts affecting those on low incomes and benefits but the last three weeks have been dominated by talk of pain for the “squeezed middle” and the rich.
The Child Benefit cut for payers of 40% tax was widely criticised in the media as not having gone to plan for George Osborne at Conservative Party Conference, but in truth it did a clever job : making it look as though those at the top are bearing great pain. Saturday’s news about rail fares going up 30-40% also for many people conjures images of southern commuters who can basically afford it being asked to pay a bit more (even though the reality is that vast numbers of ordinary people will really struggle as rail fares rise). Raising student fees does a similar job : prompting headlines for days about squeezed middle class kids leaving university with massive debts before going into highly paid jobs and paying them off (although yes, there was also concern about putting poor people off university education) . And the defence cuts have been a great distraction for the government PR operation : with acres of coverage of whether aircraft carriers that won’t be delivered for years will have Harriers or helicopters flying off them before the new Joint Strike Fighters finally arrive in about eight years (if we’re lucky).
But over the next couple of days the bad news for those at the bottom will leak and be briefed in abundance. Already it seems child benefit is to be cut further – essentially being scrapped for most families whose children are over 16 years old. The building of affordable social housing will largely stop, as the budget is raided by between 60-80% to save billions. The government is intending to spend less on benefits paid to those living with disabilities. And it also intends to spend billions less on giving people on modest incomes tax credits. (Read Faisal Islam’s blog on the details)
You might ask if the news gets out anyway what does the government gain by trying to manipulate it? Well, it is all about lasting impressions. This government wants to be seen as progressive – as doing more for those at the bottom than it does for those at the top. The last few weeks have been about establishing the coalition really cares about fairness, and is prepared to hit the better off. If that idea is well planted voters might not feel so bad about what is happening to those at the bottom. And if there are enough stories about waste and benefits cheats (as there were again this weekend) then they might regard more of those at the bottom as the undeserving poor.
We are entering an unprecedented period for news. There are going to be so many stories it is going to be very hard to know where to point our attention. And it will take a long time for much of it to emerge. Within Whitehall departments this wednesday will be “a good day to bury bad news” like no other before. But we may not actually get the details of how overall spending decisions impact on people and jobs at the frontline for months.
George Osborne has claimed the Conservatives are the true progressives in British politics. Whether we will be able to truly judge that on Wednesday is not clear. He’s done a good job of staying ahead of the story so far, dribbling it out in clever chunks. But even he is going to struggle to stay in control of the biggest cuts since the twenties.
There are 31 comments on this post
And the CSR is only a tiny part of it. Already we have got Notts County Council decimating it’s financial support for the Voluntary Sector. They’ve been clever & got in early so they can blame others when they have to do more later. They’ve also been careful about cutting their posts and saying that cuts have no or little impact on the Council staff. What they forget is that so much of direct service delivery to the most vulnerable is performed by this sector.
This is not guided by any real care for people at the bottom of the pile but by ideology. It’s absolutely shocking. I guess that they are hoping that the most disenfranchised and vulnerable don’t have the wherewithal or energy to kick up a stink.
sad.
Please, please keep up the Good Work on Channel Four News and bring the slashers and cutters to task in their continuing attack the most vulnerable. Especially whilst the tax dodgers and evaders get away with their rich pickings. The opposition is no opposition at the moment so people need someone to highlight the injustices that are about to be served upon us. Great Blog.
Once you’ve taxed and taxed and taxed and spent and spent and spent and all the money has gone, resort to the tried-and-tested class war.
The rich create the jobs and have the skills to go anywhere they wish. How many jobs have you created? Sure, tax loop-holes have been created and exploited (naturally), over the past few decades, but this has been to keep the wealth-creators here. This is the worst time for communism to rear its ugly head.
By the way, Channel 4 is largely tax-payer funded, so should at least pretend to be balanced.
Just on Channel 4 funding : it isn’t largely funded by the taxpayer at all. It is a commercially run station owned by the state so does not get any money from the treasury and is funded by advertising
what a surprise; we hear banks sitting on £7 billion in bonus payments yet they still pay a relative pittance in taxes, & yes, before anyone else tells me they’re bringing in much needed financial revenues from trading internationally the truth is that they’re just setting us all up for the next debacle in a few year’s time. We’re told, in todays Tiomes, that London is no longer the desirable destination for international financiers it once was -great I say, perhaps the ones that don’t run off elsewhere will knuckle down to safe, high street, lending and repay the, probably unpayable debt, they already owe the UK taxpayer. As ever the poorest will lose out, betrayed by mealie mouthed polititians who treat the voter with utter contempt once they’ve got their parliamentary seats secured.Even the “good” ones are soon “whipped” into shape.
I’m afraid that banker bashing is counter-productive. We all feel the pain, but the bashing just isn’t helping. Since it started, around a quarter of hedgefund managers have left the UK, taking with them £500m in tax revenue per annum. http://tiny.cc/em3u9i29y1
I don’t say this to excuse the inexcusable. Its a very sad fact, but a fact nevertheless. The tax measures meted out in revenge are likely to reduce our overall tax take – with the perverse result that poor people end up paying more tax.
The real culprit in the banking debacle is regulatory failure. If you don’t set and enforce guidelines, then business will not behave reasonably. Its like blaming the dog when someone gets bitten – the real problem is that the owner didn’t have it on a lead and hadn’t bothered to train it.
New Labour knew about the problems and did nothing. Gordon Brown even campaigned for reform whilst shadow chancellor. All was forgotten in office, with endless banking business leaders recruited to staff his special projects.
The hypocrisy of guys like Alan Johnson therefore beggars belief. Please don’t be tempted to entrust former trades unions leaders with the economy. Its madness.
Tom
Thats simply incorrect.
And in opposition the Tories did what exactly…applauded as regulation was pulled back. Had more heavy regulation been applied the party of the market (Tories) would have pointed to the fact that thousands of bankers will leave to trade in New York as the rules would be more sympathetic there.
The reality is that this lax regulation was started by Thatchers deregulation and the repeal of Glass-Steagall in the US. Yes the previous government had a case to answer in respect of regulation, but the tories being wise after the fact do not have stainless hands.
The bankers bonuses should be hammered in my view. They are working in the most benign conditions possible with low interbank rates relative to the rates charged to borrowers and also QE money swilling about to buy sovereign debt. So in effect the bankers are using a combination of our money and the benign conditions to pay themselves increased bonuses. If a bank cannot make a profit in this benign market, it never will.
It’s sad that public transport is so expensive, because it has the potential to add so much enjoyment to life: letting us visit places and relatives and also it opens up employment opportunities.
I’ve never had a car but I’m going to think about getting one in the future if the rail fares increase or I may just travel less.
Regularly I do the rail journey from Manchester to Berwick then from Berwick to a village by bus. It is a trial.
The bus only runs every two hours. There is never a reduced fare for the whole rail journey and the difference between a single ticket and return has narrowed over the years. Booking in advance to get any kind of reduction would be a nightmare due to the bus situation and because I don’t know what I’ll be doing weeks ahead.
In a nutshell, the entire system is run for the benefit of the rail companies not the public and we are fast getting to the stage where it is cheaper to drive somewhere alone in your own car than get there by train.
What else is to be expected from a Conservative government?They are just carrying out all the same policies they did when they were in for 18 years before Labour, people have short memories.Let us just be clear on what would have happened after 5 years of the Tories..the poor will be very much poorer and the rich will be very very much richer..as always.That this may come as a surprise to people is in itself a surprise.The worst thing of all is that the British will just sit on their backsides and do nothing where as the French are out in the streets protesting..
But the fact remains- the Labour government led us into years of pain thanks to a fiscal policy built on sand. The government MUST make cuts to rectify the mistakes of Blair, Brown et al and flabby, inefficient public services are sadly the easiest target. We should be pointing fingers of blame at Darling rather than Osbourne.
Erm – didn’t the pay freeze, recruitment ban, changes to indexation (RPI to CPI), housing benefit cap etc ALREADY hit the poor?
And in all that you do not acknowledge spending will actually rise. These aren’t cuts. If you want to perpetuate financial imprudence visit Ireland or Greece. There the cuts are deep and real. Is this what the lefty C4 hacks truly want?
I must say that I am bemused at the people that refuse to believe that the country has a deficit and that it needs to be slashed. The country has been living beyond it’s means for years. We need as a State to start to aim for a NIL deficit and only fund capital projects with loan finance if they exceed £1B in value. Even these should be financed within the NIL deficit umbrella.
As for cutting benefits, if the exchequer cannot afford them so be it.
If this means a reduction in discretionary spend then fine, reductions in Satellite TV subs for example would be no bad thing. The economic realities should be focussed on all, and they are. Similar NIL deficit economics at a household level should be encouraged too.
There’s a risk of deflation yes, but that needs to be accepted.
I worry at times about the lack of objectivity in some of the reporting of financial matters.
Agree completely. Channel 4 is sounding more and more like the biased and dumbed-down BBC news every day. We live in a country of welfare handouts that has created generations of people with no work ethic, no skills, low self-esteem, and no sense of responsibility. We dumbed-down education in order to pump out massive numbers of graduates who can’t speak or even spell properly and aren’t fit for most private sector employment. Of course what mattered to the government were the statistics and not the real outcome of these policies. Then we have the nerve to claim we need to bring in more immigrants (that we can’t afford to house) because we lack the skills that businesses need. Of course Channel 4 was right out there pumping the students with ire over the cuts last week. Now we have the mainstream media attacking the only people who have the balls to start cleaning up this utter mess. We haven’t gone nearly far enough. The biggest benefit scrounger of them all is the EU, but we don’t expect Channel 4 to even touch that one. Another ‘no go’ area, sadly.
Rather than just looking just at the deficit now, what we now need is a more in-depth investigation into how the Western world got itself in this financial mess and how to avoid it in the future. I’ve got little time for the externalisation of all the blame onto one group or other in society – even the bankers. Some useful starting points
1) was the sustained growth up to the financial crash anything more than a boom artificially extended through increasing levels of public and private debt?
2) What was the basis of government accounting – to what extent was the future level of public liability (PFI, Public Sector Pensions etc.) realistically accounted for, or was the truth kept from us?
3) did the government actively encourage asset price inflation (especially in housing) as a means of stimulating the economy (and the known dangers of that).
4) just how realistic where government projections of growth, and what analysis were they based upon?
5) where have the big growth areas been in public expenditure, and to what extent were
6) has the promotion of tertiary education actually benefited the economy, and has it been fit for purpose? Germany has just about the lowest expenditure (by %GDP) on tertiary education in Western Europe – have we just been following a faith-based model that increasing the quantity of graduates is good for the economy?
7) what is the impact of the huge trade imbalance between the UK and much of the world? Of course that’s extensible out to many other Western countries too.
There are lots and lots more of these questions. We need a proper series that analyses the financial background and not the narrow base of what went wrong with the financial industry.
There’d be no need for benefit cuts at all if they chased after the tax evaders who cost this country twice if not three times the benefit bill.
Totally agree Patrick, sick of people being takin in by the spin against peopple who claim benefits, yet ignoring the tax evaders.
This is the Marionette coalition; one knee jerk ‘action after another…
Slashing the social housing building program is ridiculously short-termist. One of the reasons the Housing Benefit Bill is so high is due to councils having to pay market rents as they don’t have enough stock of their own, largely thanks to Right-to-Buy. It’s also going to hammer the construction industry further, when they’re already reeling from the cuts in the Building Schools for the Future programme.
Spin is back…..Don’t I recall the Conservatives attacking Labour for spin? But with a Tory-dominated media, no-one will actually point out that the new Emperor has borrowed the previous one’s clothes!
Cutting back on benefits paid to social migrants would go some way to reducing the DWP expenditure. That a migrant worker from countries such as Romania or Bulgaria can come to this country and start claiming tax credits on entry is scandalous. Some would say that these people are only doing the jobs that UK nationals won’t do – For the most part, this argument is rubbish.
Lack of regulation of the financial sector helped us get in to this mess, but the burden of the foreign claimants is making things worse.
We get fed brainwashing propaganda and scaremongering stories of ‘terror’ threats every single day yet, British people in their millions are resigned to a life of misery at the hands of a government run by the wealthy. Here we have Britain back in the Dickensian era short of faecal matter flowing down the streets. We are a country where the majority are powerless, cowardice and controlled by a dictatorship and a manipulated media. Britain today is a massive divided country with festering hate and people forced to commit JUSTIFIED crimes just to survive. We have a country where the rich would rather that the poor go commit suicide or be kept by relatives. A country where 90% of the wealth is dominated by 5% of the populations. A country where property costs and rents are dominated by the rich owning portfolios of hundreds of housing stock. A country where predatory capitalism has been allowed to ride rough shot over the majority and benefited only the minority. A country where the public are isolated from reality because most pubs are closed down. A country where the MPs/Lords Bankers and corporate scum do as they please with money and commit fraud on a colosal scale. A country responsible for over a million dead in Iraq. A country where the secretive government propaganda machine the BBC selectively denies airing stories that show the reality of the demise of Britain. A country that manipulates the unemployment stats and where over 9 million are out of work. A country that is dumming down the nation as bad as any ‘axis of evil’ country like North Korea or Iran. A country that spouts the moral high ground while suppressing a cowardice public. A country in Europe that silences the citizens while Greece, France, Ireland, Spainish citizens resist the onslaught of the corrupt rich and challenge these laws put down by the corrupt governments. Britain has become a Police State and plans have been drawn up to suppress the public already. It’s a dictatorship. The rich scum need stopping whatever the cost and by whatever the means. British citizens need not fear a Chinese invasion or a terror attack when their lives have been ruined by the rich scum of the land. People who swan off abroad to their luxury hide away while riots and protests get suppressed. British people need to start thinking smart and expect payed infiltrating trouble makers at protests. These people will try to get the media to convey protests as thug anarchist rallies. The media, esp. the BBC ignore the wider picture of a nation of misery, division, hate, reasons for crime and want to stereotype protesters as thugs and trouble makers.
People of Britain should stand up and be consistent, steadfast and look at the French resistance taking place now. Europe is collapsing as a result of predatory capitalism and corrupt rich scum running governments. They need overthrowing not just protests.
Britain needs proper governance for ALL the people equally.
The ‘domino effect’ is heading yor way
It’s all a minipulated game of bankers, always been, we wouldn’t have to have spending cuts if the ELECTED GOVERNMENT controlled the issue and printing of money instead of the UNELECTED BANK OF ENGLAND.
Want to know the truth about money and understand how it works. Search in youtube for the The Secret of Oz by Bill Still who is actually having a talk in the UK this month I think, Sky news is covering it, Channel 4 interview this guy, he has the answers for us, time to continue to educate the public
The Secret of Oz by Bill Still
http://www.youtube.com/watch?v=D22TlYA8F2E
share it, facebook it, twitter it, time to wake up
I’m grateful to see that not all of this blog is the usual knee jerk reaction to words like ‘Tory.’ Honestly if this government has been manipulating the news it’s making a right mess of it. All I ever see and hear on the BBC and Channel 4 are predictions of gloom and graphics of big hatchets.
Of course it was Labour who presided over the boom in personal and public debt to unprecedented levels, house prices which were ludicrous and all the while told us they had it all in hand.
Get a grip, Krishnan.I always watched Channel 4 news because it was at least trying to be informative rather than partial but since the election you’ve been a bit of a disappointment.
Stick with tax evasion and avoidance – legalised fraud – and the property/issue, please C4. Ending the former could bring in anything between an estimated £20bn-£100bn. It’s difficult to calculate precisely something as nefarious as tax-fiddling. (I note your scientist friend, Jon, planning his annual returns to the UK in order to avoid tax.) Introducing land-value tax (LVT) as a replacement for the wholly regressive council tax (CT) would also fill a huge hole in the government’s coffers and help end the iniquity of second/multiple homeownership with the latter’s lower CT, and obscene house prices.
Tax Justice Network’s excellent and informative website – http://www.taxjustice.net – is worth visiting by anyone interested in social justice (both TJN’s and Richard Murphy and Jon Christensen featured in last Monday’s Dispatches programme ‘How the rich beat the taxman’. The most blatant offender was, of course, Cameron-advisor and dress-shop owner Philip Green but ‘elected’ cabinet ministers were also in the frame: Osborne himself, and the family Trust set up for him by his father; Transport’s Philip Hammond; and most egregious of all, overseas aid’s Andrew Mitchell, seen recently on C4 News wandering through a devastated Pakistani village. No Damascene conversion for millionaire Mitchell, then, casting off the shackles of mammon to better pursue a juster, more decent world.
Re property/housing: please become the top dog investigator on this. C4 made an excellent start with last week’s analysis of buy-to-let with its cheap mortgages and the ghastly ‘trade fair’ for BTL’s ghastly landlords.
Ending tax avoidance/evasion and introduction of LVT would make many of the cuts shortly to be announced unnecessary. We’re definitely not all in this together, and C4 can do much to expose this invidious, divide-and-rule myth from the smug millionaire cabinet. Concentrate on tax evasion and property/housing, and you’ll win plaudits as well as educate.
Spot on Meg!
Thanks, Patrick. Had intended to mention you in earlier posting.
i think that gentleman pottery worker needs to get real..so people smoke..so they get benefits…there are genuine people out there and sometimes people smoke because of stress or depression.this is supposed to be a free country.you cant have people dictating what you do or dont do.hitler isnt here…this country is going backwards..the whole point i think is to make us depend on private sectors in everything..we will either end up like america,where you have to pay before you get medical treatment or we will end up living in squalor because its always been knock down the poor man and keepp the rich man rich…
The state is dependent on the private sector – for tax revenues to pay for the whole damn thing. Where do you think that government gets its income from?
It is exactly as the last comment stated.Over many years the public sector has grown fat by the actions of the last incompitent governmet. With so many of the Labour members in parliament, particularly those in the Government,never having had to take responsibility for private employment efficiency to keep afloat, they have little or no idea how to run the public sector efficiently. It has been a case that’s a good idea, implement it whether viable or really needed,and spend ever more of the wealth crated by the private sector who so far have taken all the grief with lost jobs and reduced, or non existant, pension provision, whilst the public sector spend ever more of the income from the private sector on their fully funded final salary pensions. The BBC bible in the form of The Guardian advertises imaginary needed jobs for the puplic sector that if done in the private sector would leave many companies in the hands of the receivers.
As for all the hot air and crocadile tears about the cutting of welfare provision, is it not precisely because this section cost such a huge part of the total government spending.Get real all you left leaning whingers, your government spent our taxes like there was no tomorrow
Who helped to defeat the pole tax because it asked all those earning to pay their share towards the various local government expeditures of which they had, and were, benefiting…..such as their education; road use; policing;refuse they contributed towards making. Instead they thought only those living paying rent, or owning their house etc, were the only benificiaries…Get real for once in your belief that you are entitled to other people’s efforts whilst making little or no contribution yourselves.
And how about adding some more pictures? No offence, site is really nice. But as I know humans acquire information much more efficient when there are some useful pics.
Nency Tayfon