Published elsewhere: Is bringing back the 10p rate band such a good idea?

This is a slightly longer version of an article posted on Liberal Democrat Voice this afternoon...

It is hard to believe that it has been five years since Gordon Brown announced the abolition of the 10p rate band in an failed attempt to be too clever by half (as my mother would describe it), and I am as surprised that it has taken until now for someone to suggest reintroducing it.

I have quite a lot of respect for the Conservative MP for Harlow, Robert Halfon, whose initiative this is. He does seem to have the ability to spot ideas that are popular and not necessarily obviously ideological - fuel duty, for example - and this is potentially one of them.

At Conservative Home, he argues;

Restoring a 10p rate of income tax, between £9,205 and £12,000, would cost around £6 billion a year according to the House of Commons Library. This is significantly cheaper than raising the personal allowance to £12,500 (which could cost as much as £14.4 billion). It also has the advantage that it would benefit all workers, and could be paid for without dragging more families into the 40p band of income tax.

He is, I suspect, right in his arithmetic - I haven't checked, although I suspect that others are actively doing so. Introducing a new, lower tax rate would be totemic, a perpetual reminder to Labour activists and the public of the catastrophic error of judgement made when abolishing it in the first place. And given, the remarkably low level of knowledge displayed by the media with regard to tax, it would probably be hailed as a huge giveaway to the less well-off.

It also addresses something which bothers some amongst Conservative ranks, in that raising the personal allowance takes more people out of tax altogether, giving them less incentive to support reductions in government spending - it is, to their mind, much more attractive to support spending if it doesn't cost you anything personally. And whilst, adding an additional tax rate does add complexity to the system, that isn't to a huge degree.

There are some obvious downsides. His proposal only gives £279.50 back to basic rate taxpayers, whereas raising the personal allowance to £12,500 would give £659.00 to the same people, a much more attractive option for the 'squeezed middle'. And, of course, without other adjustments, his tax cut would go to everyone, including the currently unpopular wealthy, who would benefit disproportionately - it would be worth £978.25 to a 45% taxpayer, something he appears intent upon, as he doesn't apparently intend to reduce thresholds. It also leaves those on minimum wage still paying income tax. 

So yes, it would cost less than increasing the personal allowance to £12,500, but it should be noted that giving away less money should obviously cost less, and he is somewhat comparing oranges with apples given the differing thresholds he applies in his argument.

There is also an argument, which I hear less of than I might expect from Conservatives, which runs thus;

"If we take less money from the paypackets of the poorest working families, we need give less to them in benefits and credits, reducing the benefits budget plus the costs of administration, as well as reducing the number in receipt of benefits."

You might argue about whether you might withhold an amount of benefits/credits equal to the reduction in the tax bill, or use the money for other targeted benefits, such as child care, or just raise the living standards of the poorer, more vulnerable elements of our society, or whatever, but it would give governments of whatever stripe options to reform society in a manner suited to their philosophy. Personally, I'd favour measures designed to lift children out of poverty, but everyone will have their own ideas.

Increasing the personal allowance to £12,500 does come with a cost, plus the added complexity required to restrict the benefits to the wealthiest which in turn would probably drag more people into higher tax bands. It is simpler for most though, continues progress towards taking those on the minimum wage out of the tax system altogether (if it's a minimum wage, one might ask why should it be taxed). It could also be seen as part of a potential equalisation, and thus simplification, of tax rates, national insurance contributions and the National Minimum Wage.

In summary, reintroducing the 10p rate band is an interesting idea, which will attract support from across the political spectrum, even as its proponents will argue about the necessity for consequential adjustments to ensure their personal definition of fairness. It is less generous than the Liberal Democrat proposals but, obviously, more easily affordable.

The debate should be an interesting one in the twenty-seven months before the next General Election...

Published elsewhere: Euro 2014 - a cause to fight for, not to hide from

Those nice people at Liberal Democrat Voice have graciously allowed me to publish this on their pages. But as I know that there are those of you out there who don't read it...

So, we’ve selected our candidates for Europe in England and Scotland, and a pretty good bunch they are too – people who are committed to the concept of a Europe of twenty-seven (soon to be twenty-eight) nations pooling some sovereignty for a greater good. So far, so good. But what are they going to do for the next eighteen months?

Past experience says, “not much to do with Europe”. Yes, they’ll be campaigning to a lesser or greater extent, but what will they becampaigning for? In the past, that’s generally meant something little different to how we campaign for Westminster, vote for us to keep X out, schools, jobs, the environment, you know the sort of thing. We’ve mentioned Europe in passing, but only to the minimum extent necessary.

So, why not try something radical? If opinion polls are to be believed, we haven’t got a huge amount to look forward to unless there is a sizeable increase in our level of support over the next year. If that’s so, why not, to use baseball parlance, at least go down swinging?

With UKIP campaigning to pull us out of Europe, the Conservatives publicly hostile to anything coming out of Brussels to shore up their right flank, and Labour increasingly sceptical when they aren’t being cynical, there is an enormous political space for a political party that believes in engaging positively with Europe and our European partners.

You would think that, as a traditionally internationalist party, that should be ours, and intellectually, it is. However, over the years, we’ve allowed ourselves to be cowed by the Eurosceptics, whose distortions and hyperbole have dominated the argument. “Europe isn’t popular,”, we are told, “it will hurt us if we campaign for it.”.

So, let’s not campaign for it, let’s campaign about it, making the case for active engagement, for making it more accountable, more transparent, more relevant to the state our country is in. Let’s talk about why, by electing Liberal Democrats, you’ll get a better environment, an improved transport network, more opportunities for yourselves and your children.

And let’s talk about what’s wrong with Europe too. Let’s admit that there are things that Europe wants to do that we don’t agree with, and how Liberal Democrats can stop them. Let’s talk about our campaign to reduce waste, to focus spending on enabling growth and creating jobs. We could even talk about our future in an enlarged single market.

The talk in recent months has been of differentiation, of impressing upon the electorate that we haven’t lost our identity. There is a danger that, in making the effort to do so, we forget who we really are. So, why not take an issue where we are poles apart, and go out and campaign for something, rather than against someone?

What’s the worst that could happen?

Published elsewhere: Next week in the Lords - 15-18 October

It looks as though this column may be going down in flames, now that the Lords have appointed a new Media and PR Officer, but until we do...

Days 7 and 8 of the Committee Stage of the Financial Services Bill dominate the week. And, as I still don't understand it, I'm going to see if I can get an explanation. Watch, hopefully, this space... However, Amendment 197, to be moved by Lord Flight, requires banks to transfer accounts to a new institution, if requested, within ten working days and without charge. I suspect that the banks won't like this, but as it is suggested that people are more likely to divorce than to change bank, creating a more meaningful market in retail banking can only be encouraged. Interesting that the idea should come from a Conservative though...

Day 2 of the Report Stage of the Local Government Finance Bill takes place on Tuesday. I'm led to understand that there are rumblings about the impact of this legislation on the voluntary sector and on social enterprises, so we'll see if they can sort this out, as promised by Baroness Hanham before the summer recess.

There are two other pieces of legislation to be debated in the Chamber. On Monday, we have the Report Stage of the Trusts (Capital and Income) Bill, a piece of legislation so fiendishly complex that it required a Special Public Bill Committee to steer it through its First and Second Readings. On Friday, we have one of the backlog of Private Members' Bills, the Inheritance (Cohabitants) Bill, sponsored by Anthony Lester from the Liberal Democrat benches, which seeks to give new rights for cohabitants when their partner dies.

On the Committee corridor, EU Sub-Committee B takes evidence from Jo Swinson as part of its inquiry into 'Women on boards', a subject taken up by Kishwer Falkner on Wednesday in her oral question on European Commission policies on women on corporate boards. On Wednesday, Danny Alexander is questioned by the Economic Affairs Committee as they continue to examine the potential impact of Scottish independence on the UK economy.

Apart from Kishwer Falkner's question on Wednesday, there are oral questions on Monday from Derek Ezra (ninety-three years young) on UK self-sufficiency in energy, on Tuesday from Claire Tyler on the recommendations of the Riots, Communities and Victims Panel on building character and personal resilience, and on Thursday from Sally Hamwee on Anti-Slavery Day and awareness that individuals may be the subject of modern slavery. There will also be debates on developments in the bus industry, sponsored by Bill Bradshaw, and, in Grand Committee on the report of the European Union Committee on The EU: Sudan and South Sudan Follow-up Report, to be opened by Robin Teverson.

Finally, Thursday sees a debate to mark the centenary of the Scott expedition to Antarctica. I know that Ros and I covered a lot of miles during her tenure as Party President, but I really didn't think that we'd got that far...

Published elsewhere: is the golden age of government largesse over?

Here's another piece that I've written for Liberal Democrat Voice...

It is true that things were always better at sometime in the past. Or at least, it feels like that, especially as you get older. But perhaps it is. In the period since World War II, government, at national, state and local level, has provided more and more in the way of support to indivdiuals, organisations and communities, mostly for reasons widely supported to be of public good, sometimes for more cynical reasons, occasionally because it can. In a growing economy, such interventions are sustainable.

However, Robert Black, the former Auditor General for Scotland, in a lecture at the David Hume Institute last night, questioned whether or not the current range of free public services can remain so. And, whilst his examples were taken from Scottish government programmes, the point he makes is one that the rest of us need to consider very carefully. Responding to Scottish Labour leader Johann Lamont's suggestion that their support for free university tuition, a freeze on council tax and free NHS prescriptions could be in doubt, Black said;

The move being made by the Labour Party in Scotland to at least start asking questions is a good thing. We need to do more of that but we need to do it as a society. I mean can we really afford all the services that are free at the point of delivery?

Of course, politicians agree with that. Well, mostly in private, but they do. The question is, how do you create a safe space in which politicians engage with the wider society to argue over what, and how?

To take two of his examples, the cost of the concessionary travel scheme in Scotland in expected to reach £500 million in the next decade. Is sacrificing that to maintain free, or subsidised nursing care for the elderly a reasonable exchange? Did increasing police numbers in Scotland from 6,900 in 1949 to 17,000, despite the use of technology, make people safer, or even feel safer? What has changed to justify the increase?

In his lecture, Robert Black went on to argue that, instead of focussing on passing more and more legislation, government should spend more time on budget scrutiny. The notion that Parliament might focus on how things work and what they cost, and how one might make existing structures work better, rather than replacing them with new ones, is not very 'sexy', nor does it leave an obvious legacy for the Minister, but it does have the potential advantage of stability and of organic, evolutionary change in the way public services are run.

As Liberal Democrats, we need to be part of that debate too, and whilst it is tempting to take the same stance that Labour have taken in opposition at Westminster - not this cut, not in that way, not now - if we are to protect the vulnerable, create opportunity and encourage freedom, we need to think about our priorities for a decent, inclusive society are and how we pay for them over the long term, and then start making that case in public. 

* Mark Valladares worries about balancing the books at his Parish Council in Creeting St Peter, Suffolk. He has a nasty feeling about anything much beyond that.

Published elsewhere: Next week in the Lords - 8-11 October

It dawns on me that my work for Liberal Democrat Voice really should be published here too - after it is published there, of course (I know the rules). After all, some of the people who read this, including my family, don't go there.

Yes, the moment you've all been waiting for, the House of Lords is back! And whilst I get to spend less time with my wife, legislation awaits. Will the death of Lords Reform change anything on the red benches? Just what are they going to discuss without it?

There are three Bills carried forward from before the summer recess;

As a gentle loosener after a summer of grouse shooting, light naps and memoir writing, Monday sees Day 6 of the Committee Stage of the Financial Services Bill, perhaps now to be known as the Lord Sassoon farewell tour (he's standing down as a Minister once the Bill is passed). It is, for the most part, extremely technical (that's in the sense that, frankly, I have no clue what they're on about). For the most part, it will be about Lord Flight, the somewhat controversial former Tory MP for Arundel and South Downs and before that an investment advisor and director of banks, attempting to amend the regulatory framework from that intended. From the Liberal Democrat benches, Susan Kramer will be trying to nudge the Minister gently towards greater transparency, whilst Andrew Phillips will be pitching for the individual investor, based on his experiences as Jimmy Young's "Legal Eagle".

On Tuesday, the Defamation Bill gets its Second Reading. The aim of the Bill is to reform the law of defamation to ensure that a fair balance is struck between the right to freedom of expression and the protection of reputation. The Bill makes a number of substantive changes to the law of defamation, but is not designed to codify the law into a single statute. Key areas include a requirement for claimants to show that they have suffered serious harm before suing for defamation, the removal of the current presumption in favour of a jury trial, the introduction of a defence of "responsible publication on matters of public interest", increased protection to operators of websites that host user-generated content, providing they comply with the procedure to enable the complainant to resolve disputes directly with the author of the material concerned, and new statutory defences of truth and honest opinion to replace the common law defences of justification and fair comment.

Finally, Wednesday is Local Government Finance day. Can't wait, can you? I know I can't... And yet, the Committee Stage ran to six days, and the Lords is full of ex- and in some cases, current local councillors. The Report Stage promises to be lively, especially given some of the savage cuts to be made in terms of grant settlement over the coming years.

It's a good week for Liberal Democrat interventions too, with short debates on provision of mental health services on Monday, initiated by John Alderdice, and a longer debate on the case for considering an alternative constitutional settlement in the event of the break-up of the UK on Thursday, called for by Robert Maclennan. Perhaps linked to the latter, the Economic Affairs Select Committee is taking evidence on the economic implications for the United Kingdom of Scottish independence on Tuesday. In addition, Dick Taverne has an oral question on Wednesday about evidence-based treatment in the National Health Service - a gentle dig at Jeremy Hunt's enthusiasm for homeopathy, perhaps?

Finally, in Grand Committee on Tuesday, Margaret Sharp has a debate on the contribution of further education colleges to their local economies and communities, whilst Qurban Hussain kicks off a debate about the human rights situation in Bangladesh.