The PM is annoyed with the media – he should try sorting out the problems

It beggars belief that an intelligent man should lash out against the media for daring to run the story that many people are against the abolition of the 10p tax band. Why on earth in a free society should the media ignore such a story? It makes Gordon Brown, like his post Thatcher predecessors, appear to be the poodle of the headlines rather than in charge of the government.

Let me explain to the PM why this 10p issue is a story. It is story because a large number of Labour MPs are saying they disagree with the policy and might vote with the Opposition parties, who also disagree with the policy. If enough of these Labour MPs keep their word, the government could be defeated on a central plank of Gordon Brown’s last budget. That would be big political news.

It is a story because prices of food, heating and travel are shooting up, in a way which hits the budgets of those on low incomes especially hard. Gordon Brown’s decision to remove the 10p band hits several million people on low incomes, taking more tax off them, at exactly the same time as they face these surges in their bills. The political world has to understand that it cannot fix such a real problem for the voters, by better spinning or media control. Real problems need real solutions, not more expenditure on better spin doctors.

It is a story because removing the 10p tax band puts up the taxes of all of us at a time when most feel under pressure in our daily budgets thanks to rising taxes and rising prices.

If Gordon Brown cannot understand why this is a story he does not have much of a future as PM. What he should do is respond. He can do things to make it better for people – the rest of us can merely complain about what he is or is not doing.

There are two ways out. My preferred way would be for him to admit it was wrong, announce the restoration of the 10p band, and make proportionate reductions in government waste and overheads to pay for the change.

The other way is to explain to his hapless backbenchers why it is right to increase taxes in this way, so he can be sure he can win his vote. Then between them, they have the other task of persuading the rest of us that a tax increase is good for us!

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4 Comments

  1. tim holden
    Posted April 19, 2008 at 10:36 am | Permalink

    The PM wants to be loved. Anything that leads to not being loved infuriates him. This, together with a number of other more than valid reasons, is why he is not loved.
    The most dangerous time is when the unloved abandon hope of being loved.

  2. Matthew Reynolds
    Posted April 19, 2008 at 1:21 pm | Permalink

    Dear oh dear ! Why not just sweep away tax credits & age related tax allowances and replace Job Seekers Allowance & Incapacity Benefit designed to slash economic inactivity and phase out the majority of QUANGO's ? All the money produced by those measures could fund raising the basic personal allowance to £10,000 p/a , the winter fuel alowance to £700 p/a for all pensioner households while exempting the over 65's from the first £1,000 p/a of their Council Tax while raising Child Benefit to £30 a week for the first two children and to £25 for each other child ? That would make tax & benefits a bit simpler while making government smaller and helping people by more than just restoring the 10p band as that would complicate things a bit at a time when Lord Forsyth points out that taxes need simplifying . But as a sop to those who want a 10p band it could be restored for one year only on the first £2,400 p/a of taxable income in 2009-10 – funded by some of the money raised by following the £20 billion privatisation plan as suggested by the Adam Smith Institute . If economic conditions will be worse next year then putting money in everyones pocket in a way that favours the poorest will give the economy a boost when most needed ( poorer people are more likely to spend extra cash ). Then as the higher basic personal allowances & fuel allowance , extra child benefit and OAP's council tax cut started to kick in the 10p band could again vanish in 2010-11 thus simplifying taxation without hurting the least well off or indeed anyone else . My plan would boost household budgets & reduce poverty rates at a time when the first is under strain and the other to high. This anti- poverty – pro- growth agenda could be phased in over five or six years as and when savings from QUANGO cuts & welfare changes where secured . Moving money from the bloated state sector to the wealth creating private sector would as in Eire help undo the damage done by Labour that is so evident for all to see.

  3. Matthew Reynolds
    Posted April 19, 2008 at 12:21 pm | Permalink

    Dear oh dear ! Why not just sweep away tax credits & age related tax allowances and replace Job Seekers Allowance & Incapacity Benefit designed to slash economic inactivity and phase out the majority of QUANGO’s ? All the money produced by those measures could fund raising the basic personal allowance to £10,000 p/a , the winter fuel alowance to £700 p/a for all pensioner households while exempting the over 65’s from the first £1,000 p/a of their Council Tax while raising Child Benefit to £30 a week for the first two children and to £25 for each other child ? That would make tax & benefits a bit simpler while making government smaller and helping people by more than just restoring the 10p band as that would complicate things a bit at a time when Lord Forsyth points out that taxes need simplifying . But as a sop to those who want a 10p band it could be restored for one year only on the first £2,400 p/a of taxable income in 2009-10 – funded by some of the money raised by following the £20 billion privatisation plan as suggested by the Adam Smith Institute . If economic conditions will be worse next year then putting money in everyones pocket in a way that favours the poorest will give the economy a boost when most needed ( poorer people are more likely to spend extra cash ). Then as the higher basic personal allowances & fuel allowance , extra child benefit and OAP’s council tax cut started to kick in the 10p band could again vanish in 2010-11 thus simplifying taxation without hurting the least well off or indeed anyone else . My plan would boost household budgets & reduce poverty rates at a time when the first is under strain and the other to high. This anti- poverty – pro- growth agenda could be phased in over five or six years as and when savings from QUANGO cuts & welfare changes where secured . Moving money from the bloated state sector to the wealth creating private sector would as in Eire help undo the damage done by Labour that is so evident for all to see.

  4. mikestallard
    Posted April 19, 2008 at 8:40 pm | Permalink

    It's a bit like stopping smoking really. We all know how to do it – don't light up, don't buy ciggies, don't stand around outside bumming fags off other people. The problem is that many people do not want to stop smoking.
    Gordon Brown likes to buy votes with hand outs. He also likes to waste a lot of money on bailing out failing banks. He has a growing bureaucracy and its quangos to feed. So he borrows money. We all know (see last post) what OUGHT to be done. But will he want to do it?
    I am getting worried myself. If I behaved like he does, I should by now be bankrupt. I do not see the taxation system bailing him out. Neither do I see the international community bankrolling him for ever. Is it too much to see the whole government going bust? This has happened in history to the most unlikely people: Philip II of Spain, the British Empire in 1945, France under the ancien regime.

    Reply: Yes, governments can go bust. Whilst this government is borrowing far too much, the poor British taxpayers are still able to pay the interest. We are not about to go bust – merely to see all of us paying more and more tax for less and less result. £75 billion on the mortgage market so far – that's serious money.

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    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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