Liberal Democrat activists condemn bedroom tax
Party members urged leadership to rethink the policy during debate at autumn conference in Glasgow. Read more…
This is the second time that Councillor Butt has repeated untrue accusations about Sarah Teather (Letters, 4 April). Sarah’s failure to vote with the government while she was a minister led to articles in the Sun and Daily Mail calling for her to be sacked. Cllr Butt is aware of this as on 8 February 2012 he retweeted: “David Cameron urged last night to sack Lib Dem MP Sarah Teather after she refused to vote for welfare reforms.” To claim he is surprised or bemused by her opposition now is disingenuous.
Similarly his claims about Sarah’s work with Brent council are false. If Cllr Butt had talked to his officials he would be well aware of the many meetings that have taken place between Sarah and the council’s acting chief executive Fiona Ledden, its interim chief executive Christine Gilbert, and other senior officers to discuss the welfare changes. This is on top of hundreds of letters she has written on behalf constituents affected by the changes, meetings with housing association chiefs and Jobcentre managers and the work her office has been doing with community organisations which serve hard-to-reach groups. To express a different political viewpoint is one thing. To misrepresent an opponent’s record shows poor judgment.
Councillor Paul Lorber
Liberal Democrat group leader, Brent council
• The current hype about social class is brought into uncomfortably sharp focus by the chancellor’s post-Philpott comments demonising benefit claimants (Lib Dems attack Osborne, 6 April). The Lib Dems are still prepared, three years into coalition, to feign innocence at their partner’s callousness. The time for them to decide is running out – are they really heartless Tories? Or can they return to their roots – to Liberalism and democracy? The stakes are high, for them, for the country – and for this newspaper, whose recommendation to support the Lib Dems in the last days of the 2010 campaign still casts a shadow.
Rev John Lees
Competition to build new garden cities and suburbs among plans being revealed by Liberal Democrat leader
Nearly 50,000 homes could start being built next year as a result of the government intervening to unblock stalled projects. In a preview of next month’s autumn statement by the chancellor, Nick Clegg will outline on Thursday the plans in a speech warning of a housing crisis in which more than 100,000 new homes are needed.
Housing groups and business leaders have also been calling for a boost in housebuilding, which would quickly create jobs and stimulate growth in the UK’s stagnant economy.
The Lib Dem leader will also detail the government’s plans for a competition to build new “garden cities and suburbs”, modelled on the more ambitious new towns such as Letchworth and Welwyn, built in the early 20th century, and Corby, Basildon and Milton Keynes, created after the second world war.
“Unless we take radical action we will see more and more small communities wither, our big cities will become every more congested as we continue to pile on top of each other and the lack of supply will push prices and rents so high that – unless you or your parents are very rich – for so many young people living in your dream home is going to be a pipe dream,” the draft of Clegg’s speech says. “There’s only one way out of this housing crisis: we have to build our way out.”
Clegg’s speech follows a host of government announcements that have promised to “kickstart” the house building industry, including a major housing strategy announced a year ago with the promise that it would be “ambitious” and “deliver homes and strengthen the economy”; an independent review of the problems led by the chairman of 3i investment group, Sir Adrian Montague, which reported earlier this year; and an ongoing review of house building standards intended to cut red tape for builders.
Statistics released last week show that in the 12 months to the end of September, new housing starts fell 9% to less than 100,000, though completions rose by 6% to 117,190.
The government is also competing with half a century of under-building of new homes, and the failure of the Labour government’s ambitious “eco-towns” project which, similar to the coalition’s new towns programme, had intended to construct new settlements of up to 20,000 homes.
Clegg will argue that the “politics of housebuilding is shifting” as parents are increasingly worried about how their children will get on to the housing ladder – potentially counterbalancing a long history of local opposition to new developments. The average age at which people can now afford their first home has risen to 35.
“As we, as a society, become more open to development that creates the space for politicians to be bold,” say extracts of Clegg’s speech.
Clegg will announce that the government has found “a number of large locally-led schemes” – of between 4,000 and 9,500 homes – which had “hit a wall” and pledge to “intervene directly”, including providing funding in the form of loans which would be repaid when the homes were sold. If all the schemes went ahead, they would build 48,600 new flats and houses, he adds. All were ready to start building new year if they could be helped, said sources close to Cameron.
However the deputy prime minister is set to disappoint housing experts who have called on the government to release public land to speed up new developments by only demanding payment once the homes were built and sold, signalled sources.
The National House Building Council welcomed the focus on a long-term programme rather than ad-hoc initiatives, adding: “But such an ambitious programme shouldn’t come at the expense of other shorter-term measures which could deliver growth quicker, for example giving small parcels of public sector land over to developers to be built on.”
Jack Dromey MP, Labour’s shadow housing minister, said: “On house building the government has made announcement after announcement followed by failure after failure.
“Rather than more empty promises we need the government to take real action now and to tackle the housing crisis and boost our flatlining economy.
“That is why they should back Labour’s call to use the windfall from the 4G auction to build 100,000 more affordable homes, and give a stamp duty holiday to first time buyers.”
Opinium/Observer survey finds that 39% of Liberal Democrat supporters would vote in favour of leaving Europe
Almost four out of 10 Liberal Democrat voters support leaving the EU, according to a new poll which shows that hardline euroscepticism has taken hold in Britain’s most pro-European party.
An Opinium/Observer survey has found that 39% of Lib Dem supporters would be inclined to vote in favour of leaving Europe if an in/out referendum were called.
Overall, 56% of people surveyed would vote to leave the EU, while 29% would vote to remain. About 68% of Conservative and 44% of Labour want to leave, against 24% and 39% respectively who would stay in.
The results will fuel the growing political debate about Britain’s place in the EU, which has seen even cabinet ministers suggesting that the UK would prosper on its own.
In general, over a quarter (28%) of likely voters think our EU membership is a good thing, 45% think it’s a bad thing and 18% are neutral.
Voters aged between 18-34 are the only demographic group clearly in favour of the EU, with 44% calling EU membership a good thing and 25% a bad thing. The group aged between 35 and 54 are the mirror opposite (45% believe it is a bad thing and 26% a good thing).
Over 55’s are much more clearly opposed, with 59% calling it a bad thing and 20% a good thing.
The poll also reveals that Labour’s lead has fallen to seven points (from 39% to 32%).
The prime minister’s net approval/disapproval rating has also jumped to the highest recorded by Opinium since April – -12% – although he is still behind Ed Miliband at -10%. Nick Clegg stands at -43%.
• Opinium Research carried out an online survey of 1,957 GB adults aged 18 and over from 13 to 15 November 2012. Results have been weighted to nationally representative criteria. Full polling results are available here
‘It’s tough. These are difficult times, we’re being tested,’ prime minister to tell delegates at party conference
David Cameron will seek to prevent Ed Miliband’s “one nation” Labour driving him from the common ground of British politics on Wednesday, asserting that his brand of compassionate Conservatism is not just for the strong, but also the best way to help the poor, the weak and the vulnerable.
Despite a conference full of tough messages on burglary, welfare and sometimes social issues, the prime minister will insist: “My mission from the day I became leader was … to show the Conservative party is for everyone, north or south, black or white, straight or gay.”
In his annual speech to the Conservative party conference, he will tell his party: “It’s not enough to know our ideas are right. We’ve got to explain why they are compassionate too.”
His aides decline to refer to the political “centre ground” arguing that on issues such as welfare, crime and Europe, the common ground is to the right, and in territory long occupied by the Conservatives. He will also refuse to bury the much derided “big society” concept in his keynote speech closing the conference season saying his task is “above all to show Conservative methods are not just the way we grow a strong economy, but the way we build a big society”.
But on the day after the IMF issued another downgrade of its UK growth forecasts, Cameron will also issue a stark, almost existential, warning to the country, saying unparalleled global forces mean the country is at an hour of reckoning.
He will say: “Unless we act, unless we take difficult decisions, unless we show determination and imagination, Britain may not be the force which it has been in the past. The truth is this we are in a global race today and that means an hour of reckoning for a country like ours – sink or swim, do or die.”
At the same time, flashes of his trademark optimism will appear, drawing on the revival of the British spirit shown in the Olympic summer.
Cameron’s aides believe that Miliband’s largely insular address to his own party totally failed to address not just the deficit but the scale of competitive challenge facing Britain due to rise of new global powers. He will argue that these forces require tough decisions on spending, welfare, and schools if the strivers working hard are not to feel cheated.
The prime minister’s aides acknowledge that although Miliband, in personal terms, delivered a strong speech, they estimate he has made two major strategic errors in failing to make tough decisions on the deficit or show a greater willingness to curb the welfare budget.
Cameron will say: “Labour’s plans to borrow more is actually a massive gamble with our economy and with our future. We’re here because they spent too much money and borrowed too much. How can the answer be more spending and more borrowing. I honestly think Labour has not learned a thing.”
George Osborne upped the stakes by claiming a fundamental threat to the free enterprise system now existed, adding to claims made by Cameron that Labour is waging class war.
He told a meeting of businessmen in Birmingham: “Really for the first time in my adult lifetime, up for grabs is the argument about a free enterprise economy.
“That was really resolved I thought at the end of my teenage years when the Berlin Wall fell and all parties and all groups in Britain basically accepted the consensus of the free market economy.
“I would say you just see signs of that being contested, contested because of what’s happened in the banking crash, and people are starting to say it’s OK for the state to take 50% of the national income, it’s OK for the state to tax people 50% of their income, it’s actually wrong to challenge vested interests in our education and welfare system.”
In an implicit acknowledgement that the electorate remains confused about his core values, Cameron will reveal more than he has ever done before about his personal background.
Cameron will not present himself as a hard luck story, but the son of a man that suffered disability, stigma, loneliness and a broken family. Cameron’s father Ian died two years ago aged 77 and had been born with both legs deformed, and endured repeated operations in an attempt to straighten them. “Because disability in the thirties was such a stigma, he was an only child and probably a lonely child,” Cameron will say.
Challenging those who see the Conservatives as the party of snobs and the rich, he will say: “There is nothing complicated about me. I believe in working hard, caring for my family and serving my country”.
Cameron found himself under growing pressure over his plans to cut the welfare budget, with Liberal Democrat grassroots bodies demanding that Nick Clegg does not sign up to such measures. They are furious that their plan to raise taxes through a “mansion tax” has been thrown out by the chancellor. There is suspicion in Lib Dem circles that Clegg has in broad terms agreed to this level of welfare cuts, something his officials hotly deny.
Mark Garnier, a member of the Treasury select committee, said at a fringe event: “The reason we have a low interest rate is because the economy is absolutely screwed.” But Cameron rejected a change: “It’s not Plan B that we need, what we are doing is making sure that every part of Plan A is firing on all cylinders.”
Your article (Muslim sect hounded in Pakistan warns of UK threat, 8 October) states that I attended a meeting of Khatme Nubuwwat in Luton in July. This is true – but it is incorrect to suggest that I automatically support the views of my hosts at any meeting which I attend.
As a Muslim peer I am regularly invited to attend meetings on numerous topics, and try to get to as many as time permits. In this case, a meeting was being held by supporters of Khatme Nubuwwat. However, when I was given the opportunity to speak, I repeated the strong message which I deliver at meetings across the country – that in favour of tolerance and in opposition to sectarianism and hatred both within and between religions.
It has always been my belief that it is for an individual to choose what to believe in. Britain is a multi-faith, multicultural society and there is no room for hatred. This is the message I will continue to deliver at meetings, even when I disagree with others present.
Liberal Democrat, House of Lords
It’s pretty obvious that those workers least in fear of discrimination would be most comfortable surrendering rights against arbitrary dismissal, and those who felt most insecure least able to accept a package where part of their pay was conditional on surrender of employment rights (Osborne plans to give workers shares – if they give up job rights, 9 October). Disabled people would probably be the biggest losers, but it would be a gamble for any group that tends to face prejudice to accept the waiver against arbitrary dismissal. Obviously if you were friends with your boss, it would not be a concern.
Given the modal annual salary is about £15,000, and the mean about £30,000, to allow employers to offer discretionary pay of up to £50,000 to people not worried about being discriminated against would in effect mean the repeal of anti-discrimination legislation. The point of rights is that you don’t lose them if you’re too poor and vulnerable not to succumb to pressure to sign them away. Even for the Tories, this is shocking.
•?It’s not clear from your story (Osborne seals deal for £10bn welfare cuts, 8 October) whether the deal has been sealed, but if the Liberal Democrat leadership support further huge benefit cuts they will betray the Liberal heritage of Keynes, Beveridge, and the last half-century.
People receiving benefits – including those I represent on Pendle council in Lancashire – include most of the poorest in society. Many have low-paid jobs, many others would love to work if the jobs were there. They’re not too bothered how much tax the rich pay; weekly survival is more pressing. Linking taxing the rich more with cutting the incomes of the poorest has no logic to it and would be a dishonest political sleight of hand as an excuse for Lib Dem support for the Tories again ripping off the poor.
Liberal Democrat peer and councillor
•?Don’t be too quick to dismiss the prospect of further taxes on the rich by George Osborne (Editorial, 9 October). In a speech full of rhetoric but light on policy there were few specific announcements, but one was: “If there are other ways to increase revenue from the very top without damaging the enterprise economy, we will look for them.” Not taxing the rich till the pips squeak, perhaps, but almost certainly firing the starting gun in negotiations with the Lib Dems about a new tax regime for the wealthy.
Private Wealth Comms
•?Let me get this right. The government is cutting benefits, so crime will almost certainly increase as some look for ways to supplement their income. The government has cut funding for the police, so they are less able to protect us from crime. The government wants us to be free to use more violence to protect our homes from criminals and will change the law to allow this (Grayling goes back to basics, 9 October). Is this is what Cameron means by the “big society”?
Jeffrey R Butcher
•?Isn’t one of the duties of government to ensure the mentality of the lynch mob is kept in check? Germany’s experience of unfettered but targeted hatred in the 30s and 40s showed what happens when that duty is rejected. In the UK, making incitement to hate a criminal offence is one way we have tried to fulfil that duty. Cameron, Osborne and their henchmen are issuing licences to hate with every word they utter.
•?George Osborne wants to give a preferential tax regime for shale gas in the UK, while his Committee on Climate Change and UK companies call for a zero-carbon power sector by 2030 (Businesses back tough carbon target, 8 October). Can he tell us how this year’s energy bill will make these aims compatible? Green business is one of the fastest-growing sectors in the UK at a time of recession; why not invest in a sector we know is working for the UK and make us a world leader in renewables, rather than lock the UK into high-carbon infrastructure for a generation?
Senior adviser on climate change, Christian Aid
Shadow chancellor finds playing music relaxing, but is irritated by Lib Dem attacks on his ideas to tackle recession
It is not often that Ed Balls admits to quiet terror. But three months ago he faced his Grade I piano exam.
The buildup had been fraught. His piano teacher had told him he would be taking the exam along with six of her other pupils, all aged six to eight. On the morning of his exam, the shadow chancellor was sitting nervously in the waiting room alongside his fellow students when an urgent call came from Ed Miliband’s office saying that he was needed at a joint press conference on the banks.
Balls asked whether he could be excused. He had been learning his three pieces for months and this was his last chance to get his Grade 1 before the examining board changed the pieces, forcing him to learn three new ones.
Miliband relented, and Balls took the exam, including clapping rhythmically, in the formal, unforgiving atmosphere music examiners love to generate. The examiner made no move to recognise his 45-year-old student. A jumble of nerves, he played the pieces too slowly and, as he left the room, he turned to the examiner, admitting: “That was so much more frightening than the House of Commons.”
Happily he passed, albeit without a merit, and is now on Grade 2. “It totally frees my mind from politics,” he says.
One suspects he may need those moments of release soon. He is now into the very hard yards of the shadow chancellorship, the moments when his judgment will be most tested. The shadow cabinet is trying to extract spending pledges from him. At the same time he is under pressure from union leaders angry at plans for a public sector pay freeze set out in a previous Guardian interview. The GMB leader, Paul Kenny, warned Balls not to expect a standing ovation at the end of his conference speech on Monday.
He was also singled out for attack at the Liberal Democrat conference, both by Nick Clegg and Vince Cable.
Balls retorts: “Clegg essentially said ‘ignore the fact that we are in recession, that borrowing is rising and the plan has failed, but focus on the most narrow issue of which Tory cut he will not accept in 2015′. I am not going to get into an austerity bidding war with him when the austerity plan is failing.”
He also scoffed at suggestions by Cable that there was no substantive difference between himself and Balls on the length of time it should take to eradicate the deficit. Cable said that Balls’s sole slogan was “we should not cut the deficit in six years but seven”.
“He made that up,” Balls says. “Given that fundamentally he knows in his heart of hearts that he agrees with me, and not George, Vince has to pretend the difference between me and him is quite small, and between me and George is quite small. The truth is, I have a radical big difference with George, it is just that Vince is either biting his tongue or completely capitulated from what he believed before the last election.” He adds: “We were told the right approach was tight fiscal policy and loose money. The counter argument from people like me has been that in a post-financial crisis, such as Japan in the nineties or across the world after the 1929 crash, monetary policy simply cannot do the job because confidence is so low. To say that you can just rely on loose monetary policy in such circumstances is the Ramsay MacDonald mistake.
“It is unbelievably frustrating to hear Cable acknowledge the fundamental problem is a lack of demand, yet not reach the obvious policy conclusion. When Vince was on the [Andrew] Marr programme, and I had been on earlier, I heard him say the problem was demand, and I wanted to run out onto the set and shout ‘Eureka! Yes! Do something about it!’ And what happened? Nothing.”
Some around Cable have argued that the distinction between monetary and fiscal policy made by Balls is now artificial and that the two levers have effectively merged as the Bank of England becomes more interventionist.
Balls dismisses this as mere sophistry. “To be fair to the governor of the Bank of England, he is saying I cannot turn monetary policy into an arm of fiscal policy. If you want to issue debt in order to spend, that is a fiscal decision that should be done by the government on the government balance sheet.
“The reason why Osborne and Cable are tinkering at the edges and pressing the governor to take action is because their own political obstinacy and vanity is getting in the way of the need for fiscal action. It is not the Bank’s job to use its balance sheet to attempt to target what is essentially fiscal spending guaranteed by the taxpayer. That is the government’s job, and a budget decision. Fundamentally, the problem is that companies and consumers are not spending because of a lack of confidence.”
He believes the public are even now only starting to understand the scale of the policy error. “We have lost £47.5bn of hard lost output against the 2010 budget forecast – that is £1,800 in lower income in every household before you consider tax losses. We are paying £24bn more out in welfare benefits. The national debt is going to be higher at the end of this parliament than the Darling plan that Osborne ridiculed. The economy may come out of recession in the third quarter, but the danger is that two years of slow growth becomes six years.
“By the time we get to the autumn statement in December, people will realise that borrowing is not going down, it is going up. George Osborne could be forced to dumping his fiscal rules, and retreat to annual fiscal budgeting.”
That analysis in turn places more pressure on Balls to say more about how the government should address the crisis before 2015, something he intends to do in his conference speech. But it also means that, if Labour is elected, Balls has to reassure the electorate that he is serious about deficit reduction. He will not say if he will match coalition spending plans, but he does for the first time admit that he will conduct a review in which every budget will be open to fresh scrutiny.
“We have got to show that we have got a plan that will work in the short and long term. We have got to show we have a long-term plan on banking, vocational education and industrial strategy.”
He then set out his plans for a root and branch spending review after the election. “We have to show we will not duck difficult decisions on public spending and on pay. We will face up to harsh truths. Everyone in the shadow cabinet knows there is no spending spree after the election. They know the inheritance is going be hard, and we will have to set out fiscal plans in our manifesto and in government.
“But the public want to know that we are going to be ruthless and disciplined in how we go about public spending. For a Labour government in 2015 it is quite right, and the public I think would expect this, to have a proper, zero-based spending review where we say we have to justify every penny and make sure we are spending in the right way.”
He says the coalition’s spending review in 2010 was conducted in haste in the worst kind of Treasury way. “This will provide us with a strategic look at everything in the round from first principles.” Ironically, some in government agree. One ministerial aide said this week: “The idea of star chambers – when four very intelligent people meet for half an hour to settle a public spending dispute – just does not seem the best way to look at the future of government spending.” Balls may yet get the chance to show if he can come up with something more sensible. If so, he will deserve a merit.
This proposal is mistaken on so many levels it is hard to know where to begin – but let’s start with basic economics
Over the years the Liberal Democrats have come up with more than their fair share of potty ideas. Few of them, though, are pottier than Nick Clegg’s suggestion that parents should be able to dip into their pension pots in order to provide their offspring with the down payment on a property.
This is wrong on so many levels it is hard to know where to begin, but let’s start with the basic rules of economics. The reason homes are out of reach for most young people is that property prices are too high. The obvious way to allow more people to get their foot on the housing ladder is to bring prices down. Clegg’s idea would have the opposite effect. It would push up prices and only help young people with well-off parents. Bad economics and regressive to boot.
A second point that appears to have escaped the Liberal Democrat leader – a man who can look forward to a nice final salary pension, naturally – is that the value of the average pension has been slashed over the past decade. The move to defined contribution schemes coupled with falling stock markets and lower annuity rates means that someone approaching retirement will only be able to help their grown up children by impoverishing themselves. For generations past Britain has saved too little and too big a slice of investment has gone into bricks and mortar. For too long, too many individuals have relied on rising house prices to see them right in their old age.
Clegg’s harebrained idea would make all these problems worse not better. It shows that even after the events of the past five years politicians remain fixated by the need to stimulate the property market so that house prices start rising.
Lib Dem chief secretary to the Treasury also says those earning more than £50,000 a year may have to pay more
Danny Alexander, the chief secretary to the Treasury, has promised a major crackdown on tax-dodgers capable of raising £4bn and said those earning £50,000 a year may have to pay more as part of the drive to reduce the deficit.
He denied targeting the richest 10% – those earning more than £50,000 a year – was a cap on aspiration, and said a “mansion tax” or some other wealth tax would be popular among voters. Lord Oakeshott, the influential Liberal Democrat peer, described the mansion tax as the “big bazooka” that only Liberal Democrats could deliver.
Speaking to the BBC ahead of his speech to the Liberal Democrat conference in Brighton on Tuesday, Alexander also admitted the coalition parties would be looking for £15bn of deficit reduction in a mix of higher taxes and reduced spending in 2015-16, an election year. The two parties will have to show how the deficit will fall in the spending years thereafter, but not the details of how it will be achieved.
Alexander has also confirmed that only 30% of the spending cuts announced in the spending review in 2010 have so far been implemented.
Although Alexander has made announcements about clamping down on tax avoidance before, he insists his latest announcements are new.
He said up to £3bn could be raised by targeting Britons who stash their money in Liechtenstein alone, adding: “We are putting in place additional investment to beef up the scrutiny which HMRC are able to put on the affairs of people worth more than £1m, the vast majority of whom pay their taxes completely properly, but a small minority of whom are trying to get away with not paying their fair share.”
Alexander also stressed that the Lib Dems, trying to bill themselves as the fair taxes party, would continue to press for a tax on high-value homes, which the business secretary, Vince Cable, claimed was being blocked by Tory “backwoodsmen”.
Lib Dem sources have briefed this week that they might look at additional council tax bands as an alternative method of targeting high-value homes, but in response to newspaper reports that this was an option being actively considered, Nick Clegg’s office said: “The government has no plans to change council tax bands. The Liberal Democrats are focused on the mansion tax.”
Alexander said: “The Liberal Democrats have a clear policy: we believe that there should be an extra levy on high-value homes worth over £2m. It’s what we argued for in opposition, it’s what we stood for election on in our manifesto last time and it’s what we will continue to argue for.”
He added: “There is a broader point which is, as we move into the next phase of deficit reduction when we are going to have to make painful choices about public spending, about welfare cuts and so on, then we have to make sure that the wealthiest in society pay their fair share of that extra burden that the whole country is facing.”