A brighter vision

I think the government has done enough to warn people that they inherited a mess in the public finances, and that tough decisions have to be taken.

As readers of this site know, the deficit reduction programme hinges on collecting large extra sums on tax revenue, which in turn requires reasonable levels of sustained growth. The government needs to turn more of its attention to creating the conditions for that to happen.

Yesterday evening I was discussing how the UK could enjoy the manufacturing revivial Mr Osborne says he seeks. It will take urgent action to allow and assist the banks in financing more industrial investment, expansion and new ideas. It will require a strong Freedom Bill which includes sufficient cost reduction through the removal of less desirable or ineffective regulations. It requires a more competitive tax regime on company and personal income. I will be talking about that this morning at the Policy Exchange event.

We need to hear more of the plans to involve, engage and assist the public sector workforce. The government is about to embark on large reforms in a wide range of public service areas. It needs to take its staff with it, and to harness their energies and talents to the task of delivering more for less.

We need a policy for wider ownership, for enterprise, for savers. We know the bad news – now let’s hear the good news. Let’s see how the government can help create a society were working is rewarded, where savers are no longer penalised, where more come to own and participate in the economic life of the nation. Let’s build more bridges between public and private sectors, and let more people work for the public service through small business, employee buy outs and other means of encouraging employee participation in the success and quality of the service.

I hope to catch up with the website later today – it has been a hectic 36 hours at Conference.

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46 Comments

  1. Wokingham resident
    Posted October 5, 2010 at 7:48 am | Permalink

    Well Mr Redwood, as one of your tax-paying constituents, I read with growing disbelief and anger George Osborne's announcements on child benefit. My family are to be penalised because I worked hard and got myself promoted. My family will lose £1700/year because of that gross mistake by me. . Yet my in-laws who have a combined income of £80K will get keep their benefit because neither of them are higher rate taxpayers. By all means reform child benefit, but the way George Osborne has chosen to do so is so gob-smackingly stupid as to defy belief.

  2. P H
    Posted October 5, 2010 at 7:58 am | Permalink

    Until the banks start to lend again to sound businesses and people are more positive about the future good growth will be very hard to find.

    A positive message from government is urgently needed. Allowing people to keep and invest their own money, a smaller state and less regulation, cheaper energy and less state interference everywhere could be a very positive message.

    But do the cabinet actually believe in it?

  3. BigJohn
    Posted October 5, 2010 at 8:00 am | Permalink

    Can I just start of by saying I have lived in Wokingham most of my life, and I am a single 49 years old male with a job.

    It seems nobody in government give a I(damn -ed) about me !!!

    Any money I receive from doing my job (After the deduction of PAYE tax) is used to pay for :-

    1) My mortgage (I could live an easier life if I was living in a taxpayer subsidised council house, where everything is paid for).
    2) Owning a car (Only necessary if you have a job, so you can actually go work to pay the bills).
    3) Booze and fags (Legal drugs required to help people like me who work, and have to cope with giving away most of what you earn, to people who don't work so they can have a better life than you !!!!).

    When I say "giving", it is not be correct, it is being stolen from me, I can't remember agreeing for any of this !!!!

    To give you an example of why there is a big problem with the system (And why anybody who has to pay ther own way is (fed up ed)).

    My boiler packed up two years ago, I can't afford to get it fixed.
    Last winter, I had to switch on the rings of my gas cooker, combined with a desk fan on the kichen counter to blow the hot air around.
    If I need hot water, I have to boil a kettle.
    It takes me an hour to get a bath together.

    I am sure if I was living in social housing, or had kids, this situation wouldn't arise, as I am forced to pay for them, before I am aloud to sort out my own housing problems !!!

    The sad thing is I will be doing the same this winter, as it is the only way I know how to survive.

    If anybody wants to complain about benefit cuts, they need to speak to me.

    So the new rules are going to be, anybody who has the luxury of receiving tax payers money for doing (little-ed) has no incentive of getting a job unless they earn more than the average wage.

    Is this not taking the p*ss out of people who are not on benefit, who are earning less the average wage ?

    As far as I am concerned, the total maximum benefit should be less than minimum wage, not average wage.

    I have always had some major concerns about how this average wage is calculated, as obviously the average moves as soon as you give taxpayers money away to people below the average.

    When can we stop throwing money away, and just get back to rewarding people for working and/or investing in doing activities that create real wealth ?

  4. Alan Jutson
    Posted October 5, 2010 at 9:21 am | Permalink

    John I like your brighter version, but the reality may be very different.

    So Far.

    A Maximum rate for all Benefits sounds good (although its still tax free) so still better off than a working family on average income..

    Removal of Child Benefit (for the better off ?) is poor , it would have been much better and understandable if you had limited it to the first two, or one child per person for everyone.

    We wait and see what else is on offer.

  5. nick
    Posted October 5, 2010 at 10:14 am | Permalink

    What's this with fairness?

    Lets have some fairness. Going after the middle class is the same as saying that we should only jail agrophobics because they are best able to deal with incarceration.

    I want those who are guilty of this mess to pay the price. That means politicians. You've created it. You failed to regulate. You've produced false accounting when it comes to the books. There are still no present values for the cost of civil service pensions. You John are to blame.

    However, no doubt you will say that its Labour. However, you're blaming all bankers for the problems. You're taxing lots of people who aren't to blame. Who haven't had any control over what's going on.

    You on the other hand are in parliament and you have control. You've failed.

    So are we going to see MPs salaries halved as punishment for the failures?

    Are we going to see MPs jailed for the mess?

    Bank bail out 22 billion

    Government debts 5,000 billion plus

    What about the state pension? Are you going to make that contractual or are you going to renege on paying it?

    Why should I pay for services or promises only to have you renege when your failures mean you can't or won't pay? (But do pay yourself)

    • Stuart Fairney
      Posted October 6, 2010 at 7:50 am | Permalink

      They won't renege on paying it, but you and I will get it in fiat money which will not be worth a great deal especially if Merv cuts lose with more QE. This may expalin why the Bank of England pension is indexed link.

      It does not however explain why we are not allowed to know who owns the shares in Bank of England Nominees Limited nor why it is subject to the official secrets act, nor why this company is exempt from some of the provisions of the companies act.

  6. Dave B
    Posted October 5, 2010 at 11:11 am | Permalink

    I'm a little worried that Mrs Harman's Equality Act might encourage businesses to leave the UK, while those that remain will spend too much time and money on compliance and law suits.

  7. Bob
    Posted October 5, 2010 at 12:06 pm | Permalink

    Well now we know what the so called "Conservatives" really think about families where one spouse is the higher rate breadwinner and the other is the homemaker,

    They could have:
    – restricted child allowance to the first two kids
    – reduced the cut-off age
    – froze it to allow inflation to erode it.

    But no, they say they prefer both parents to be at working earning something below the 40% band, and tie a doorkey around the kids necks.

    Poor show.

  8. StrongholdBarricades
    Posted October 5, 2010 at 12:17 pm | Permalink

    We need a policy for wider ownership, for enterprise, for savers. We know the bad news – now let’s hear the good news. Let’s see how the government can help create a society were working is rewarded, where savers are no longer penalised, where more come to own and participate in the economic life of the nation. Let’s build more bridges between public and private sectors, and let more people work for the public service through small business, employee buy outs and other means of encouraging employee participation in the success and quality of the service

    Are you saying that is what is coming next for stage managed conference or a tacit admission that the message so far has been wrong?

    Maybe you could blame Coulson

  9. NickM
    Posted October 5, 2010 at 1:28 pm | Permalink

    Let us not hear whinging from big business that they cannot get engineers and other manufacturing personnel.

    After one million jobs lost (lost equals gone) in manufacturing under Labour, there are plenty of people out there ready to staff technical posts. What these people will be is disillusioned though, so get rich quick schemers, fly-boys and whingers from management will get a quick boot.

  10. Alan Wheatley
    Posted October 5, 2010 at 3:04 pm | Permalink

    Also, we need for the government to stop passing legislation that puts more and more of a burden on employers. The last government's act that came into force in the last few days is a case in point.

    Such legislation falls particularly heavily on small businesses, who are not in a position to have an individual or department that deals with such things. This is the latest nail in a series on ever more onerous legislation that will drive small businesses to close. I know several such business and the hard working and enterprising people who run them because they get a lot of satisfaction from the work (it is why they started the business in the first place); they will eventually give up, not because the business is failing, but because they are fed up with the burden of unnecessary regulation. And who can blame them.

  11. Neil Craig
    Posted October 5, 2010 at 4:18 pm | Permalink

    To make cutting the regulatory morass self enforcing I would suggest that any Freedom Bill should contain the right of anybody affected by a regulation which they can prove is more than twice as onerous, for its effect, than comparable legislation in a similar industry, to sue for damages &/or to have the law suspended.

    For example,if railways can be shown to be more than twice as safe as cars (they can) then extra "safety" regulations would be disallowed.

    I suspect a few cases like that would also help educate the public who currently have to rely on the endemic hysteria of the media.

    The other requirement for growth is cheap nuclear energy. Cheap energy & economic freedom, always 7 everywhere, mean economic progress. Technically my first suggestion should legalise the building of nuclear plants since it is easy to prove that nuclear is orders of magnitude safer than other power generation methods & thus virtually all the regulations are parasitic, driving up prices.

    • Mark
      Posted October 5, 2010 at 10:59 pm | Permalink

      I watched the evolution of a story on how much extra we are going to have to pay for energy supply evolve. It started out with Alastair Buchanan claiming that our bills would increase by £6 per household per year for 10 years (supposedly to fund a £32bn upgrade in the national grid so that it can cater for having to route power in unpredictable ways to cope with windmills' uneven output). Of course, he didn't mention that after 10 years the bills would be £60 higher. Next, an industry expert did the sums: £3.2bn per year over 26 million households equals £123 per year, because we'll be paying for industry's and local government's electricity costs too one way or the other. Then another industry expert pointed out that with £200bn to be spent on windmills etc. the increase was going to work out at £769 just to cover the capital cost.

      Needless to say, many of the comments asked whether we couldn't get more for less by not wasting out money on subsidised windmills but maintaining our hydrocarbon and nuclear based supplies until cheaper technologies appeared.

  12. Mike Stallard
    Posted October 5, 2010 at 6:23 pm | Permalink

    Do you remember in the 1990s how the Guardian had all those laughable jobs – Lesbian and Gay outreach worker(£75K); anti smoking observance officer (£35K) etc etc?
    Well, what happened to them?
    When I was a school governor in the early 2000s, we had a team of SIX advisors (sic) writing stuff just for school governance in Cambridgeshire.
    Well, what happened to them?
    Have we forgotten?

  13. Dave Cherling
    Posted October 5, 2010 at 7:03 pm | Permalink

    If you want a manufacturing revival cut, cut ,cut.
    Cut taxes, cut regulations, cut public spending. All by a large amount not just the alleged cuts we're promised now. The most successful countries in the world have "small government" and so did we when we were the factory of the world.

  14. forthurst
    Posted October 5, 2010 at 7:13 pm | Permalink

    (site reference which did not work left out)
    It remains to be seen whether the German people wish to continue to fund ClubMed and the Celtic Tiger, through transfers, ad infinitum.

  15. Acorn
    Posted October 5, 2010 at 7:35 pm | Permalink

    I am struggling with this brighter vision thing. I don't see where the customers are coming from. This nation has seen a drop in its currency exchange rate with little affect on our balance of payments.
    We have a nation of welfare junkies, even at the middle class level; the only topic the media has picked up on from your conference is child benefit. You need someone who can explain the maths to the populace.
    Our Banks are still insolvent; as the Irish have just discovered with their Banks. Our Central Bank has a balance sheet which equals eighteen percent of our GDP; alas, still better than Japan at twenty six percent.. Our children and grandchildren will not thank us for that. legacy of debt.
    You know and I know, the only way to reduce this dept is a massive dose of inflation. Fortunately, the rest of the populace has no understanding of how this will impact the purchasing power of the pound in their pay packet.
    The following explains how the little people got screwed:- http://www.marketoracle.co.uk/Article23092.html

  16. P H
    Posted October 5, 2010 at 8:59 pm | Permalink

    The real problem with government is that the main input to ministers always comes from state sector employees, unions or pressure groups or large industry who want increased regulation and trade restrictions as they profit directly from it. This happens at EU, Westminster and even local level. The only input from the voter is once every five years when they vote (absurdly with a single vote for a mix of all issues) for representatives who will not do what they have promised anyway.

    Hence we get the EU, HIP packs, endless health and safety and employment regulations et al. that benefit no one but our competitors, lawyers, quangos, civil servants and a few other hangers on.

    Nearly all your commentators above clearly know what needs to be done but will anyone do it?

    It seems not.

  17. DBC Reed
    Posted October 5, 2010 at 10:33 pm | Permalink

    Very sensible statement from Mr Redwood.Unfortunately there has been too much scapegoating of the public sector for the tenor of these remarks to carry very far in the Conservative Party at present which is constructing policy on giant gambles like pushing the economy of the roof to see if it will fly.There is no mechanism in place for converting all these about to be made redundant public sector workers into private sector dynamos ,even if you you believe that bin men for instance suddenly become more productive when transferred to the private sector.

  18. Overtirednemotional
    Posted October 6, 2010 at 12:11 am | Permalink

    Manufacturing industry suffers a recruitment crisis because the education system does not deliver suitable young candidates. That alone fetters manufacturers' ability to take advantage of the few available opportuntiies. Urgent action is needed to train good quality apprentices and other entrants to thelabour market.

    • Iain Gill
      Posted October 6, 2010 at 10:25 am | Permalink

      no this is not the underlying cause of the problems which are

      we are competing with nations which
      1 do not pay licence fees on the software or indstrial technologies they use
      2 use child labour and exploit their workforces in outragreous ways
      3 are happy to allow much more pollution from their processes
      4 have no health and safety overhead

      all this puts a massive extra burden on uk manufacturing

      we are left with niche stuff where especially extra skilled or design stuff helps, but here our intellectual property is being handed over to the 3rd world at a staggering rate leaving us unable to compete

      so training is but a tiny part of the problem

      the real problem is we need to figure out how to compete with the 3rd world fast

      and then of course there is no incentive to train Brits as you can hire half a dozen (foreign) nationals in this country for the price of one Brit and the visa system encourages this

      so all in all emergency action is needed and I dont think the govt shows any understanding

      • simon
        Posted October 6, 2010 at 2:38 pm | Permalink

        The visa system affects our politicians about as much as poorly performing private pensions and low annuity rates .

        There are good foreign nationals both here and in their own countries but
        typically when a British company hires a large number of foreign nationals they assume they are getting the good ones but aren't .

        Very few companies are even able to discern quality so employment and other markets are disfunctional .

        I notice it in my area of management of data where only 4% at maximum of "professionals" have read any text books explaining the fundamentials of the field . The other 96% are not aware of the existence of anything beyond manuals from software vendors .

  19. Simon
    Posted October 6, 2010 at 12:55 am | Permalink

    How about moving your MP's and public sector pensions to the private sector so you too can watch your retirement being skimmed off to subsidise the parasites in the City of London ?

    Alternatively offer a universal pension scheme open to everyone which is administrated for the benefit of the citizens of this country , not the financial services industry .

    • Acorn
      Posted October 6, 2010 at 11:08 am | Permalink

      Simon, It is worse than that. The skimming will be done by governments as well. The EU introduced "Solvency II" some while back. A scheme designed to force insurance companies to hold government bonds as capital; as a financial crisis shock absorber. Pension funds are not yet included, but they will be eventually, for the sake of a level playing field with EU insurance funds.

      Imagine the scenario, where all citizens savings for their old age will be invested in their own governments IOUs. The central banks will be printing money to monetise those government IOUs and force feed them to the insurance and pension funds. It will be the global incarnation of the Japanese economic system – which is about to run out of Japanese savers.

      • Stuart Fairney
        Posted October 6, 2010 at 3:00 pm | Permalink

        Great link ~ I had seen nothing of this in the news media, yet I seem to know who is in the final of X-Factor despite never having seen it and having zero interest in it.

  20. Conrad Jones (Cheam)
    Posted October 6, 2010 at 1:19 am | Permalink

    Now, say the Bank pays 6% on the initial £100.
    Say they charge 6% on the newly created £900.
    (ON face value this looks like zero profit margin)

    For one year:
    They will pay the original depositor £6 (6% on £100)
    They will receive from Loans £54 (6% on £900)
    Assuming that when people borrow money – they spend it on a house, car or other Goods from a seller who will pay into their account for a brief period before buying something with it themselves. As you can see, despite the Saver receiving the same interest Rate as that charged by the Bank, the Bank still gets nine times more than the saver. This is because of the Fractional Reserve System.

  21. Conrad Jones (Cheam)
    Posted October 6, 2010 at 1:33 am | Permalink

    Correction to one line of my comment above:
    "Money = £1000, 10% Reserve = £100, Loans = £1000. It is easy to show how this works with a simple Excel Spreadsheet …"

    Should be:
    "Money = £1000, 10% Reserve = £100; 90% Loans = £900. It is easy to show how this works with a simple Excel Spreadsheet …"

  22. kenneth r moore
    Posted October 6, 2010 at 1:37 am | Permalink

    Fine words Mr Redwood it's a shame that Dave Cameron and his clique despises your opinions and many others who share your views in the Conservative party. I fear that Liberal fools like Cameron will ultimately destroy this country and that resistance is futile – but surely it is better to go down fighting than sleepwalk into their nightmare. ? Lets have some honesty please

  23. Robert George
    Posted October 6, 2010 at 4:55 am | Permalink

    John, every day you are sounding more and more like Dr Pangloss.

    Your optimism is not justified. David Cameron is not leading a Conservative government nor even a coalition government. He is leading (if that is the word) a soft left of centre Liberal government which has abandoned all pretence of Conservative principles. I am not a member of the loony right but I had a reasonable expectation of small government ,low spending and eventually low taxing Conservatives.

    Clearly I, like many traditional, middle of the road Tories have been conned by the Prime Minister.

  24. Stuart Fairney
    Posted October 6, 2010 at 7:57 am | Permalink

    A far simpler solution of course would be to say "one year from today there will no no more child benefit for anyone, also income tax is reduced by a commensurate sum of money, thus work pays"

    Thus people with jobs would benefit and the feckless unemployed who have endless children and apppear of Jeremy Kyle regularly may re-think thier actions.

    Of course that would require a tory government. If only we had one

  25. Conrad Jones (Cheam)
    Posted October 6, 2010 at 10:32 am | Permalink

    Has the Governent considered using the Bank of England to force Banks to increase their Savings Rates to increase Tax Revenue via Savings Interest?
    This would also increase money in the system allowing for more high street spending reducing the need for Quantitative Easing. Due to the Fractional Reserve System, a Bank does not have to charge more on it's Loan Rates as the Fractional Multiplier increases the Loan rate far in excess on the outgoing Savings Interest.
    Loan Rate 4%, Savings Rate 6%, Actual Loan Interest Rate to Bank = 9 x 6 = 54%.
    This would also create a new influx of money into the Banking System providing more money for Loans to Help Busineses. A New Levie should should also be charged to Banks if their Private Mortgage to Business Loans is to high.

  26. Dave Richardson
    Posted October 6, 2010 at 11:20 am | Permalink

    Your absolutely right we will not improve economic growth and the quality of our British life by just moaning. We don't need to be told 'the real problem is X,Y,Z.' That's what the mass media drones on about because scare stories sell newspapers and ups ratings. The problems are fairly obvious. What is in short supply is the willingness to take entrepreneurial risks, initiate, innovate, trade, work hard and generate the time and energy to volunteer for worthwhile causes. That's not all about money or cash incentives, either. People will respond and be motivated if a more positive message/vision/leadership were given.

  27. Wokingham Mum's
    Posted October 6, 2010 at 3:18 pm | Permalink

    George O’s and David C’s attack on the middle classes regarding child benefit strikes me like men penalizing the very people that the conservatives rely upon to vote them in.

    They should remember that they need more of us aspiring middle classes to vote for them to gain an overall majority next time and the conservatives need also to remember that now we have the Con-Dem the middle class party, Labour could position themselves as the only alternative.

    We are Conservative voting female Wokingham residents, One of us single (through no fault of my own) working mother earning £45,000 claiming no tax or child credits, paying a mortgage and supporting a child. The second, a stay a home married mother bringing up the 2 children and support the husband earning £45,000 a year in his career and likewise claiming no tax/child credits. And the Conservatives have just stabbed us in the back. We lose our child benefit £1,000 and £2000 respectively whilst our married friends both earning £38,000 each, total household income a year of £72,000 with 3 children £3000 child benefit keep theirs – Fair????!!! We think not.

    Reply: This was not a proposal I have ever made. I am sending the worries and the concerns of my constituents to the Chancellor,. The biggest issue raised so far is the differential tretament between one and two earner households.

    • P H
      Posted October 6, 2010 at 6:35 pm | Permalink

      Two earners already have an advantage in not paying 40% tax even before the child benefit changes the difference can be over £8000 PA for families with the same income.

      Clearly no one in the treasury or central office has half a brain, 2 minutes, a calculator and the back of an envelope.

      If so they could have avoided this farce which has eclipsed all else.

      • Stuart Fairney
        Posted October 8, 2010 at 9:06 am | Permalink

        One cannot help but suspect that no-one in central office has either had a real job nor ever claimed any benefit, thus the ongoing disconnect between patrician and prole. This will not end well.

        Economic chaos, discredited major parties, war weary public and hyper-inflation ~ anyone remember what comes next?

    • Rose
      Posted October 6, 2010 at 7:58 pm | Permalink

      What about returning the child benefit to mothers, as was intended when family allowances were introduced? If a mother is a higher rate tax payer, then no child benefit. Lone mothers on higher rates will no doubt complain, but something must be done to shore up the family and marriage. Child benefit is the last vestige of the married man's tax allowance, unpopular with bachelors, I know, but men must have some incentive to do the right thing.

  28. 2 Wokingham Mums
    Posted October 6, 2010 at 3:22 pm | Permalink

    We do not object to cuts and the middle class doing there bit but, please make it fair. Did George O and Dave C not talk to ministers or senior back benches about this? Surely it doesn’t take a genius to work out the consequences of this doomed to; wreck our conference; dominate the press; wind up Mums net; stress out the female population whom in turn will stress out the males in their life and alienate the conservative voting aspiring middle classes. Well done George and Dave and on the 1st day of conference, Ed and Co must be enjoying this and getting ready for the “We told you so” “We warned you” “You can’t trust the Con-Dems” speeches.

  29. 2 Wokingham Mums
    Posted October 6, 2010 at 3:23 pm | Permalink

    Sense, would say this policy could work and save the required money, if reorganized – tweaked a bit. And here is our solution:-

    Child Benefit for the 1st child and a reduced rate for the 2nd and no child benefit for any subsequent children and all child benefit to finish after full time secondary education –
    Oh and freeze it for the next parliamentary term, by not putting it up, you affectively, after time, reduce peoples dependence on it – Simple

    Can’t you have a word with Dave & George?

    From 2 Wokingham Mum’s

    • Alan Jutson
      Posted October 6, 2010 at 6:56 pm | Permalink

      2 Wokingham Mums

      Exactly my thoughts, as has been posted by me on this site on a number of occassions recently.

      We should be seeking to restrain the urge to increase the population of our already overcrowed Country with taxpayer funded help.

      We should be seeking to try and restrain those who are on Benefit and think that having additional Children is a route for helping them get further up the local housing list.

      It also may restrain those who continue to have multiple children as a lifestyle chioice at the taxpayers expense.

      Perhaps rather than 2 children it should be one per person (hence two for a couple) we do not want to encourage many single Mums to have two without a supporting partner.

      No I am absolutely not against children, or indeed large families, what I am against is unlimited State funded childbirth. Have as many children as you like but then pay for them yourself.

      Present suggested Policy will be a nightmare those who are self employed, or who have a small salary and large performance bonuses as their earnings are not guaranteed, one month they would qualify, next they may not.

      • simon
        Posted October 7, 2010 at 10:28 am | Permalink

        Alan ,

        I agree with you about overpopulation , how do you encourage it when we've got an open door immigration policy and so close to labours intentional mass immigration project ?

        In the end I decided Child Benefit was overall reasonably fair because even childless people like myself benefited from child benefit when we were growing up .

        That said I hate the principal that anyone except the needy should expect to get "benefits" from the state . The majority of people should have no involvement with the benefits system , only the tax system which already allows for a higher allowance for people with kids .

        How can it be that a public sector worker "earning" £43,000 with a pensions contribution from the state worth an equivalent 32% to 69% on top retains child benefit whereas a worker without a final salary pension on £44,000 loses it ?

      • 2 Wokingham Mums
        Posted October 7, 2010 at 12:13 pm | Permalink

        Good point about child benefit and the self employed, contractors, temps and small business owners + entrepreneurs etc..
        I work on a contract/temp basis I don’t know exactly what I might earn a year. Do I claim child benefit? If I go into the 40% bracket do I have to pay it back or if I don’t claim Child benefit and I don’t go into the 40% can I claim it back, back dated from the government. Or would I be better off stopping work (I could claim benefits to fill the gap) just below the 40% bracket – decisions, decisions and the Con Dem’s want to make life easier and encourage people like me….
        This child benefit policy is ill thought out and won’t work.

        Now 4 Wokingham Mum’s + 3 Dad’s

    • Acorn
      Posted October 6, 2010 at 7:17 pm | Permalink

      Wokingham Mums and Mum's. If you need some background to support your preferences, have a look at the following, (assuming this link is allowable by our host). http://www.statistics.gov.uk/pdfdir/taxbhi0610.pd

  30. Bazman
    Posted October 6, 2010 at 9:43 pm | Permalink

    Wine sales are set to plummet as middle classes squeal like stuck pigs as their 'free' money is being taken away from them. "It ain't fair Jeremy and Theo bleat!" As if they have ever been interested in child poverty and wealth distribution other than the neighbours kids have skiing lessons and go to school in a better car. Most people quite rightly have little sympathy for people on forty grand + a year loosing a few quid and will have noticed that a couple on eighty grand between them will keep their cash. Smart move setting the scene for major cuts across the board. Lowering the living standards of a huge percentage of the population is not the way forward though, and they will not take it lying down including the bleating middle classes.
    You have got the laugh though. A tax on the the middle classes earning less than 44k? A perfect incentive to get married to someone with a similar income or earn more. The The Tories have sorted the tax system out just how Jeremy and Theo wanted it, even though they did not know they wanted it like this. Rich people telling poor people how to live. Marvellous! Could always give up work, join the working poor or have less/ no children. Alternatively lots of children and get a free house sorry, no child benefit. Free choice. It ain't a Police state yet, though a few would like it.
    I can't wait to get my 26K and keep my child benefit.

    • Stuart Fairney
      Posted October 8, 2010 at 9:09 am | Permalink

      There are those of us who earned in excess of the £44K and declined child benefit anyway as a matter of principle. We are called libertarians.

  31. David B
    Posted October 7, 2010 at 7:47 am | Permalink

    I have no kids, and no wish to have any, so the actual benefit is on no consequence to me. This has been bodged. It is so redolent of the last lot not thinking through the consequences of what they proposed. The public clearly do not object to limits on child benefit ( op polls ), nor predictably to limits on what those who earn more than them receive in net income. However did it not cross anyone's mind that in an age when both parents in 2 parent families work the negative publicity would outweigh the good? Surely this wasn't a bit of heir to Blair shooting from the hip twaddle that should not have left Mr Osbornes mouth?

    A limit to 2 children would have been widely popular. There would have been no need to tinker with the tax code to rectify the mistake. It would have rectified the most glaring problem of the particular benefit – it incentivises the fecund poor to breed excessively . It could be inferred without being said that large immigrant families were not being subsidised by the existing population ( and that would have been popular ).

    Two groups of people seem to have large families. Those poor enough for a few pounds in welfare to make it viable, and those rich enough not to care. The middle class delay their childbearing and limit the number. They have mortgages to pay. Limit it to 2 with a target over 2 generations say of abolishing it all together. Fairness? Many women will never have children by choice. Like so many things in our society, why should they be made pay for what others choose to do of their own free will?

    Anyway. If this first " march the yob to the cashline machine " PR disaster is to become a feature of the coalition we will indeed all be doomed. I was counting on them to fix the mess, now Im even less sure they will be any better than the last lot of imbeciles.

  • About John Redwood


    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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