Let’s tackle poverty

 

 Some things most parties and politicians agree on.  Most of the politicians I know want to eliminate or reduce poverty. The new Pope has decided he too will be an advocate of the poor, bringing further media attention to this perennial all consuming issue.

Most parties also agree with the obvious point that poverty is a shortage of money to spend on their own lives.  The disagreement comes over how to supply the shortfall.

On the “caring” side of the argument are those  who think the answer is simply for richer people through  the state to give them more money. On the “tough” side of the argument are those who say we need to do mroe to promote better paid jobs for the poor which they should take to earn for themselves.

The divide comes down to the old adage – is it better to give a hungry man a regular supply of fish, or to give him a rod and teach him how to use it for himself?

Maybe the answer is you need to do a bit of both. You should  not let the man starve when there is a spare fish available to give him. You should not want him to rely for the rest of his life on spare fish won from the sea by others.

Mr Osborne has a chance in his forthcoming budget to make tackling poverty a central issue. He needs to make it more worthwhile to save, to go to work and to take responsibility for your own life. He could start by pledging to do better at controlling inflation with his new Governor of the Bank. We do not need a relaxation of the already lax approach to price rises.  He could make his own contribution by cutting energy and carbon taxes to make fuel more affordable. He should  cut taxes on working , saving and venturing, so the message is clear. We will help those in need, but the best help is to assist them tAke care of themselves.

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87 Comments

  1. matthu
    Posted March 18, 2013 at 6:27 am | Permalink

    “He could make his own contribution by cutting energy and carbon taxes to make fuel more affordable.”

    I fear cutting energy and carbon “taxes” will not be enough since the government does not recognise the ratcheted up energy prices as a carbon “tax”.

    David Cameron remains wedded to his idea that only the greenest economies are likely to prosper (as he made clear in his speech at the Royal Society on Feb 24) and he will continue to subsidise worthless green technology sacrificing real jobs for bureaucratic green jobs in the process.

    • Jerry
      Posted March 18, 2013 at 8:37 am | Permalink

      matthu: “David Cameron remains wedded to his idea that only the greenest economies are likely to prosper

      Indeed, whilst all the time the BRIC countries (and the USA) are paying only lip-service to such things, if at all. Even the move by the USA into Ethanol based fuels has more to do with ‘oil politics’ and price than any wish to cut the use of carbon rich fuels as Ethanol production its self has a significant carbon footprint.

    • lifelogic
      Posted March 18, 2013 at 11:55 am | Permalink

      I tend to think David Cameron does not remain wedded to “his idea that only the greenest economies are likely to prosper”. I think he just thinks that wins support from the gullible centre and the Libdims.

      He is clearly wrong on both counts anyway.

      Does anyone still think Huhne (or Gore) actually genuinely believe in the AGW religion? I do not. Cameron and Huhne only have to measure the electricity he gets from their toy wind machines to see the economic nonsense of the religion.

  2. Nina Andreeva
    Posted March 18, 2013 at 6:36 am | Permalink

    What is wrong with a bit of shock therapy i.e. severely cutting the value of benefits? Most of them are none contributory so nobody is being robbed. Bazza, U5 and Co, before you reply to the contrary, go and ask a hard working community nurse on around thirty thousand a year and ask her how she feels about the people she has to deal with and their lives of apparent luxury at the states expense, flat screen TVs, cars, laptops etc

    • Mark W
      Posted March 18, 2013 at 7:13 pm | Permalink

      I think you’ll find that bazza, u5 and co believe that strivers on 30k a year, taking home far less than 25k should subsidise people to receive in excess of 26k for doing nothing. Then play the old leftie tack off calling you nasty and selfish for not wishing to see workers funding shirkers by highlighting those really in need and ignoring the lifestyle choice merchants. Apparently this view means I’m twelve years old and yes as ever I’ll ram it.

      • Mark (high horse) W
        Posted March 18, 2013 at 7:14 pm | Permalink

        I meant to put the high horse in my name.

      • Bazman
        Posted March 20, 2013 at 6:18 pm | Permalink

        You would need to have a large number of children to claim 26 k a year. Lifestyle choice? How much choice do they have? This problem of large families milking the system is as real as you say it is and has been going on for decades. The problem being that how do you restrict this? Just cutting benefits is not acceptable even though it may be acceptable to you. The money given is income and though should be spent on the children and would be thinly spread if you think about it, despite Daily Mail readers believing different, can also be spent on booze and fags. Your police state ideas to control are also not acceptable and unworkable and we could think of a few for you if you like, so as ever, ram it.

    • Bazman
      Posted March 18, 2013 at 8:14 pm | Permalink

      You assume that the recipients do not world and as for being non contributory, tax credits are only paid if you work. Easy to say when as you have told us you have a 2k a week income. Second hand stories from jaded nurses are not good enough. I talk to local working and non working people in the pub. Outer space to you I suspect? A barmaid with four children who grudgingly admits life is hard but is to embarrassed to say and works long hours to improve things. A drunken free drink means more than it should. Let down your hair Rapunzel..

    • A different Simon
      Posted March 19, 2013 at 11:36 am | Permalink

      For most people on benefits the benefits do not cover their living expenses and it doesn’t take long for whatever savings they might have had to be exhausted .

      Sure there are a few people who game the system but let’s not use that as an excuse to persecute the majority who are genuinely disadvantaged and need help .

      If you want to lower benefits payments the way to do it is lower the cost of living .

      How about directing your anger at a planning system which allows people to sit on building land and artificially generates a shortage which drives people into poverty and prevents many businesses which would be viable if premises were cheaper ?

      As it stands all we see is Ricardo’s Law of Rent in action ; any surplus money people have in their pockets is sucked up by the landlords .

      If you are not renting in the conventional sense it still affects you , it’s just that for mortgage holders the landlord is the bank .

      That nurse making £30k a year isn’t really making £30K/year . The total package which would put him or her into the higher rate tax band if pension was considered . From first hand experience the good ones do a brilliant job , the bad ones can be tyrants .

  3. matthu
    Posted March 18, 2013 at 6:41 am | Permalink

    This is David Cameron speaking at the Royal Society on Feb 24 this year, as reported by the Association for Conservation of Energy (and as reported by the Sunday Times this is one of the few places you can find DC’s energy efficiency speech as it is not available from government or DECC sources):

    “And yes, it is the countries that prioritise green energy that will secure the biggest share of jobs and growth in a global low carbon sector set to be worth $4tr by 2015.

    So to those who say we just can’t afford to prioritise green energy right now, my view is we can’t afford not to.

    Far from being a drag on growth, making our energy sources more sustainable, our energy consumption more efficient, and our economy more resilient to energy price shocks – those things are a vital part of the growth and wealth that we need.

    Already today Britain is one of the best places for green energy, green investment, and crucially for green jobs anywhere in the world.”

    Not much room for lower energy prices there. Not much room for exploiting low cost shale gas.

    This is the real face of the Conservative Party today.

    • Leslie Singleton
      Posted March 18, 2013 at 11:07 am | Permalink

      matthu–Not for the first time his judgement is hideously at fault

  4. colliemum
    Posted March 18, 2013 at 6:46 am | Permalink

    Why is poverty such an intractable problem?
    As Pope Francis I should know from the Gospels: ‘the poor’ will be always with us. So are we helping them in the way of mostly providing them with fish because it makes us feel good about ourselves?
    I’m beginning to have the creeping suspicion that this is exactly the reason for the continuous existence of ‘the poor’.
    There are three players in this set-up: the poor themselves, who nowadays don’t live in slums any longer but are sometimes even better housed than those deemed wealthy enough to ‘give’ to the poor via taxes.
    Then there are ‘the rich’, which now means all who are not poor, from incredibly rich to those on mean income or less but paying taxes, and not on welfare.
    And in the middle we have the ‘industry’ which lives from ‘helping the poor’, from departments in Whitehall with their chiefs, their civil servants, their specialists and political party advisers, over the various media, to the NGOs who’ve been making a remarkably good living from combatting poverty, thanks to the generosity of ordinary people giving to them. Add the churches, of all denominations who preach on helping the poor.

    Given the ‘helping’ industry, I think this problem has now become intractable. Fish and the means of learning how to fish have now been available both at home and overseas for sixty years. What has been achieved is an increasing feeling of those who are being taxed into oblivion that except for redistribution of the money earned by those middle classes to both ‘The Poor” and the ‘Distributors’ from state, governments and NGOs nothing has been achieved.
    Perhaps it is time to tell the really rich and the ‘distributors’ to use their own resources and stop impoverishing those who work and have worked?
    Or is it the case that ever larger numbers of us have to become ‘poor’, so we can be herded, told what to do, and keep the distributor class feeling good about themselves and in the increasing comfort they’ve been getting used to?

    • uanime5
      Posted March 19, 2013 at 6:30 pm | Permalink

      There are three players in this set-up: the poor themselves, who nowadays don’t live in slums any longer but are sometimes even better housed than those deemed wealthy enough to ‘give’ to the poor via taxes.

      If you’re talking about the unemployed they do pay taxes such as VAT. It you’re talking about those who work in low paid jobs and get more in benefits then they pay in taxes then it’s not their fault that their employers’ pay them so little.

      Fish and the means of learning how to fish have now been available both at home and overseas for sixty years.

      Just because jobs/fish are available doesn’t mean there’s enough for everyone.

  5. Mike Stallard
    Posted March 18, 2013 at 7:22 am | Permalink

    I have, in my life, only met a very few very rich people. I have, however, met lots of people who are considerably richer than me.
    And I have encountered a few who are poorer than me too.
    It is all relative.
    And, do you know what? If you have food and a warm bed, that is really all there is. You can only eat one dinner.

    Meanwhile, will the greedy government please take its hand out of my pocket?

    • lifelogic
      Posted March 18, 2013 at 12:02 pm | Permalink

      Exactly,

      I am quite rich I suppose I started off very poor – it makes little difference to me I still drive my clapped out 12 year old Volvo and read, walk and listen to music for my simple almost free pleasures.

      Oh the other pleasure is to avoid paying taxes as much as possible especially in the UK. Both out of a sense of moral duty and in the clear knowledge that I will use them far better than Cameron and Osborne and soon Miliband and Balls ever will.

      • Edward2
        Posted March 18, 2013 at 8:51 pm | Permalink

        Indeed Lifelogic,
        This is something many who have never been self employed do not understand.
        Running your own company, is not about a mad desire to make huge sums of money, it is about doing what you enjoy doing and building a good sustainable, well run business that you can be proud of and being able to pass it on to the next generation.

  6. lifelogic
    Posted March 18, 2013 at 7:23 am | Permalink

    Indeed, teach them to fish they will, in the main, learn much more quickly if you stop giving them too many handouts. That way they will have to learn, it will be good for them.

    I see it is not very worthwhile to save in Cyprus as the EU just helps themselves to your bank account contents. Is this the start of a new EU trend? Oh well when there is no real democracy you can get away with slavery and theft I suppose.

    I see HMRC failed to bother to answer 20 Million calls (while profiting from the expensive phone lines) and rarely bother to reply to letters. Not only that but in my experience when they answer they often do not have a clue what they are talking about. Not all that surprising given the absurd complexity of the system.

    Yet another vital public service of wasting peoples time and money and giving them no useful information. Twenty years ago I found the inland revenue far more efficient than they are now one of the better government department as I recall.

    I see Lord Hesteltine has some more mainly daft idea on growth – No stone unturned: in pursuit of growth.

    Just fire half the state sector, get rid of the EU and over regulation, easy hire and fire, lower taxes and stop expensive energy by enforced government green religion. We just need these actions, not most of this Public Private Partnership nonsense.

    • Bazman
      Posted March 18, 2013 at 8:27 pm | Permalink

      The usual story of desperation creating work as it surely will, but not the type of work you have in mind. The moral high ground will not lie with you either when this happens as you expect the poor to suddenly gain skills they do not have. They will of course utilise skills they do have. Your view are mainly just ‘think’ such as easy hire and fire. Agencies, self employment, short term contracts, umbrella companies. Specifically how do you mean ‘easy hire and fire? No reply again? The market will solve everything. Like in banking? Have a ‘think’ and get back to us.

  7. lifelogic
    Posted March 18, 2013 at 7:33 am | Permalink

    I see Osborne refers to the Cyprus bank robbery by the EU as a “tax”. Is he still intending to compensate only the state sector Brits in Cyprus, with money taken from the private sector tax payers here?

    Still we are all in it together I see.

    • backofanenvelope
      Posted March 18, 2013 at 8:25 am | Permalink

      The “state sector” Brits were sent there by your government. The others chose to go there.

    • Disaffected
      Posted March 18, 2013 at 9:54 am | Permalink

      He would would he not when he should be opposing the action of the EU and IMF. Lifelogic, it appears to me he is doing his best to con people. The UK taxpayer will provide the compensation for the EU stealing our citizens money so the EU can entwine Cyprus further into the EU superstate.

      The IMF is in agreement with the action taken and the UK is a founder member and main contributor to the IMF so it must be with the UK’s cognisance and in the UK’s name, albeit that Osborne is trying to disguise that it is somehow nothing to do with the UK government. Why not deduct the money (tax, theft, levy, call it what you will) from the UK contribution to the EU?

      Cyprus should follow Iceland’s example, stuff the EU dictatorship.

      • uanime5
        Posted March 19, 2013 at 6:38 pm | Permalink

        Unlike Iceland Cyprus is in the euro, so crashing out of the euro and having to create a new currency will create additional problems.

        You’ve also forgotten that Iceland refused to compensate non-Icelandic people who deposited their money in Icelandic banks, which is why all the English councils lost all the money they had in these banks. So if Cyprus followed suit all the English soldiers would lose 100% of their bank accounts, rather than 9.9%.

    • stred
      Posted March 18, 2013 at 11:40 am | Permalink

      The Treasury mandarins have no doubt noted another tax down for possible future use. If any less wealthy readers are getting worried about their savings being nicked and considering bringing them home, get going quickly, as I found it took 2 months to transfer my Euros from France to the UK. This was for other reasons. Timetable as follows. I know the staff and have visited the branch a number of times.

      27.12 Email request to transfer most of savings originally sent to buy a property.
      30.12 reply- not in , on holiday
      11.01 reply – you must make the transfer by internet as it is too big for us to do it.
      16.01 reply – your password has been sent by letter and ID by email
      27.01 Email to French bank. At last received the password and tried, but refused as amount too big. Amount a tenth tried but also too much. At this stage I start to worry whether the bank has actually got any money to return my savings. We phone and they decide to sent a form by letter, which I sign and return.
      13.02 reply – They cannot make the transfer because my British bank refuses to confirm that I have an account with them or my details over the phone. This is required by their security regs.
      I phone my British bank and they say it would breach security, they can’t be sure who is on the other end and is against british regs.
      18.02 Email to French bank. I have not received a reply. Can I send a cheque to my British account and if so how much.
      My British bank then tells me it will cost £200 charges and take up to 2 months.
      19.02 My French bank has the answer. I can go to their London office where they do investment banking and confirm ID with bills and passport.
      I go there and meet some very nice chatty french ladies, who tell me what an ******** M. Hollande is etc and sent confirmation back to my french branch by post.
      28.02 The transfer is made, just in time for the account not to lapse, with charges.

      • Mark (high horse) W
        Posted March 19, 2013 at 7:04 am | Permalink

        I think I know the next stealth tax. The 60% tax at £100k has been so brilliant in slipping the media net in the way the 40% band has been lowered to offset the free allowance that I think it’s possible to try and bring the 60% allowance removal down to the 40% start. We are all in this together but the Lower middle Upper working class more than anyone else.

  8. Andyvan
    Posted March 18, 2013 at 7:55 am | Permalink

    Since the invention of the welfare state we have had politicians coming up with scheme after scheme to eliminate poverty, to get people back to work or whatever bandwagon is currently popular. Result- record numbers on benefits, a permanent underclass, virtual no go areas in some cities and vast quantities of borrowed money wasted. In short, total failure.
    That is because free markets are so manipulated and controlled that lower value labour cannot offer itself at a price that business can afford and even when it does the state interferes so much that employers regard taking on workers as very risky. So we have the situation where the state is paying people not to work, inventing silly job programs to encourage them to work and taxing and regulating the job market to the point where only masochists or big business wants to employ people.
    We also have reached the absurd point where the state steals so much of working peoples money it has to give “tax credits” (their own money) back to them to allow them to survive.
    Just cut the state, not around the edges but eliminate huge areas of state control and interference. Let’s try living in a free country again. It worked for us once upon a time, well enough for us to be the richest country on earth.

    • Bazman
      Posted March 18, 2013 at 8:32 pm | Permalink

      The wages paid by the private companies are so low as to be not viable as an income. The state tops up these low wages as an incentive to work. They are in effect subsidising the private sector who often see tax credits as part of wages when in fact they are in addition to. The wages would still be to low even if the recipient paid no tax on them, so they do in effect get back some of their own money as you say and more. If a company cannot pay a living wage it is not a viable business could be another view, but you like subsidy from the government to business don’t you? Ram it.

      • Mark (high horse) W
        Posted March 19, 2013 at 6:59 am | Permalink

        What nonsense! In cases where some private sector companies pay low wages it is a commercial fact of life. Being strangled by regulation and taxes doesn’t help small independent business.

        Your beloved public sector has a guaranteed income by holding its hand out for the govt to put unlimited money into. The private sector has to react to demand the public sector doesn’t. If the public sector was a manufacturer we’d still be using twin tubs and driving marinas.

        • uanime5
          Posted March 19, 2013 at 6:41 pm | Permalink

          Care to explain why supermarkets need to pay such low wages to the bulk of their staff when they make millions of pounds in profit. It’s competition that’s keeping wages low but profiteering.

          • Bazman
            Posted March 20, 2013 at 6:26 pm | Permalink

            He laughably believes supermarkets pay ‘market’ wages when in reality they set the wage.

    • Anonymous
      Posted March 18, 2013 at 8:55 pm | Permalink

      The British State NEEDS poverty.

      Without it many officials lose their purpose.

  9. Ben Kelly
    Posted March 18, 2013 at 8:01 am | Permalink

    Mr Redwood,

    Your solution “Maybe the answer is you need to do a bit of both. You should  not let the man starve when there is a spare fish available to give him. You should not want him to rely for the rest of his life on spare fish won from the sea by others” is worthy but I would furtber ask to whom do we taxpayers (for it is our money) owe consideration to?

    Do we owe it to the corporations which are benefitting from imported poverty in the form of subsidised immigrant labour while we pay our own to be idle or unemployable? I think not. Phase out tax credits and the arcane processes by which they are distributed and force employers to pay realistic rates tbrough innovation. If we can’t compete with the new world without taxpayer subsidy we need to review what we are doimg.

    • Jerry
      Posted March 18, 2013 at 9:04 am | Permalink

      @Ben Kelly: “If we can’t compete with the new world without taxpayer subsidy we need to review what we are doing.”

      Indeed, and perhaps any relief from CT taxes and the like should be scrapped to, or is it OK for the tax payer to subsidies one side of the coin but not the other? Also, what price socail cohesion, one only has to look to some of the African countries to see how economic well-being suffers when society starts to breakdown…

      There is a mile of difference between aspiration and the state making it possible whilst looking after those less fortunate -something that Mrs Thatcher’s government was very good juggling (for most of her time in office), and the selfish “Me! Me! Me!” culture that seemed to have firmly taken root sometimes in the 1990s and grown into a very broad tree by 2010.

    • uanime5
      Posted March 18, 2013 at 3:27 pm | Permalink

      How is removing tax credits, which give extra money to those who work, going to encourage people to work? All your plan will do is discourage British people from working in low paid jobs, making it easier for immigrants to get these jobs.

      If you want an alternative to tax credits then campaign for a higher minimum wage.

      • lifelogic
        Posted March 18, 2013 at 5:33 pm | Permalink

        A higher minimum wage just destroys jobs.

        • Bazman
          Posted March 18, 2013 at 8:35 pm | Permalink

          Evidence says it created jobs unfortunately for your blind beliefs and the threat of Armageddon should a minimum wage be introduced did not happen. Anything to say about that prediction now? Thought not. More ‘think’.

          • David Price
            Posted March 19, 2013 at 6:17 am | Permalink

            Evidence seems to be a bit variable on the topic of NMW. For example there was a paper by Karthik Reddy in 2011 entitled “Is Britain too sanguine on minimum wage”.

            The key observation is that “despite a gradual shift in opinions among policy-makers, empirical research generally confirms the traditional hypothesis that disemployment effects accompany the imposition of minimum wages that exceed the market wage.”

            Increasing the NMW will likely increase cost of living for everyone which will put those on the lowest incomes back where they started but also bring more people, such as those on fixed incomes in to that situation. Increasing NMW doesn’t solve the underlying problem which is cost of living, instead it makes the situation worse for more people.

      • Jerry
        Posted March 18, 2013 at 5:57 pm | Permalink

        @U5: Re your comment about the NMW, that was what Ben was calling for, read his second paragraph again!

        • uanime5
          Posted March 19, 2013 at 6:44 pm | Permalink

          Ben was calling for high wages through innovation, I was calling for higher wages even in industries where you can’t innovate. You’d be surprised how difficult it can be to innovate in some service industries.

    • waramess
      Posted March 18, 2013 at 3:49 pm | Permalink

      Your idea will just force up the cost of production and stifle growth/

      Better still, as poverty and unemployment are inextricably linked, give the starving man both his fish and his rod by making all employers of over 50 people take on an additional number of unemployed and, instead of paying unemployment , pay the employers an amount of money equal to the dole money plus income tax plus employee and employer contributions for those employees.

      Provided the of unemployed taken on is to a ratio of their existing workforce and that calculation is made to ensure all unemployed become employed then employers will have gained additional employees at a fraction of the cost, the unemployed will become a part of the productive economy and the cost to the taxpayer will be unchanged.

      Starving man gets fish and rod ie the unemployed become employed, the employers are able to reduce their cost of production and the politicians get the Holy Grail of growth in the economy.

      • Jerry
        Posted March 18, 2013 at 6:00 pm | Permalink

        @waramess: “Your idea will just force up the cost of production and stifle growth

        That is a very old hat you are wearing there, it is the same argument that was used against the NMW legislation, even the Tories now accept the the NMW.

        • APL
          Posted March 18, 2013 at 6:53 pm | Permalink

          Jerry: ” even the Tories now accept the the NMW.”

          The Tories are absolutely not the gold standard for sensible policies.

          • Jerry
            Posted March 18, 2013 at 10:27 pm | Permalink

            @APL: Well, what with UKIP”s benefits and Flat tax proposals even they seem to accept that a NMW/minimum income is a good idea, so only those of unthinking political dogma seem to oppose the principle…

        • David Price
          Posted March 19, 2013 at 6:22 am | Permalink

          Maybe old hat but there is evidence that supports it – see my comment above in reply to Bazman.

          Or will you set a National Minimum Pension for all at the same level as a NMW? And if you do how will you fund this continual cost escalation?

        • waramess
          Posted March 19, 2013 at 10:52 am | Permalink

          Nothing old hat about common sense and the Conservative administration seem to be lacking in that.

          Reflect on their willingness to match GB’s spending plans and you get some measure of how the Socialists could browbeat the Tory front bench into agreeing that black is white

      • uanime5
        Posted March 19, 2013 at 6:51 pm | Permalink

        Better still, as poverty and unemployment are inextricably linked, give the starving man both his fish and his rod by making all employers of over 50 people take on an additional number of unemployed and, instead of paying unemployment , pay the employers an amount of money equal to the dole money plus income tax plus employee and employer contributions for those employees.

        What happens when employers fire all their staff and rehire them under this scheme at a fraction of the cost?

        Provided the of unemployed taken on is to a ratio of their existing workforce and that calculation is made to ensure all unemployed become employed then employers will have gained additional employees at a fraction of the cost, the unemployed will become a part of the productive economy and the cost to the taxpayer will be unchanged.

        Unless the employer is able to train the unemployed so they have the skills needed to do these jobs and possesses enough infrastructure for all these employees to be able to work then all your plan will do is force the unemployed spend all day in a private company doing menial tasks for no extra money. Given how a similar scheme called Workfare was deemed illegal by the courts expect this rotten scheme to be destroyed after legal challenges are issued.

        Starving man gets fish and rod ie the unemployed become employed, the employers are able to reduce their cost of production and the politicians get the Holy Grail of growth in the economy.

        Getting economic growth through forced labour isn’t something to be proud of.

  10. Robert K
    Posted March 18, 2013 at 8:08 am | Permalink

    The IEA has produced a booklet that neatly sums up a free-market approach to tackling poverty. If we were not forced to subsidise the CAP, food prices would fall. If we were not forced to use expensive energy sources, fuel prices would fall. If a more homes were allowed to be built, house prices would fall. Less government means less poverty.

    • lifelogic
      Posted March 18, 2013 at 12:03 pm | Permalink

      Indeed and more people released to get a real and productive job for a change.

      • Bazman
        Posted March 18, 2013 at 8:36 pm | Permalink

        Like being a landlord and collecting rent? What is produced? Remind us again.

    • Mark
      Posted March 18, 2013 at 2:57 pm | Permalink

      Building more houses has perhaps surprisingly little impact on house prices, unless you build a very large surplus, when eventually it will lead to the sort of property crash we have seen in Spain and Ireland with many empty homes being demolished. The reason is that houses are long lived assets, and occupancy rates are a significant variable. There are about 27.4 million dwellings in the UK: building an extra 100,000 homes only adds 0.36% to the supply. House prices are much more affected by the financial measures that inflated and now prolong bubble prices.

      • A different Simon
        Posted March 19, 2013 at 12:06 pm | Permalink

        Mark ,

        Looking at my young nephews and niece there will have to be an extremely severe house price crash for them ever to be able to afford a house . Bring it on .

        Outside prime areas it needs to be possible to purchase a pleasant 2-3 bedroom place for about 2.8 times average wages ; ie about £80,000 . This is the old 3.5 times wages after deduction of provisions for old age adjusted down to 2.8 times to account for the money people should be saving for their old age .

        Is housing being demolished in Ireland and Spain due to idiosyncracies of the tax-system ? Is anything being rebuilt on the site ?

        People should be compelled to save for their old age so the money doesn’t just get misdirected into puffing up accommodation prices .

        Enact legislation which reserves existing housing below a certain price for British Citizens . This works in Malaysia and other countries .

        Introduce a land value tax dependent on location levied at the same rate for a plot whether it has a mansion , hovel on it or is undeveloped . Will discourage hoarding of land and encourage redevelopment of brownfield sites .

        Yes please to dirt cheap business premises to enable more people to create businesses . Imagine the stimulation to the economy , it would be as helpful as cheap energy .

    • uanime5
      Posted March 18, 2013 at 3:33 pm | Permalink

      If the CAP is removed food prices will increase because farmers will have to charge more to make up for the loss of their subsidy.

      Energy prices are high due to a lack of competition in the energy industry. Using different energy sources won’t fix this as saving won’t be passed on to the consumer.

      Unless more housing is built which is affordable for couples working for the average wage, rather than only affordable for millionaires, more housing won’t reduce house prices.

      So the free market won’t fix any of these problems.

      • zorro
        Posted March 18, 2013 at 7:43 pm | Permalink

        A free market in economics (interest rates, lower taxes, less silly regulation) would certainly lead to cheaper housing prices for people wanting to buy now…….

        zorro

        • uanime5
          Posted March 19, 2013 at 6:55 pm | Permalink

          None of those things will lead to lower prices; only high levels of competition can lead to lower prices. However due to the low levels of houses in locations that are in demand there is little competition.

      • Edward2
        Posted March 18, 2013 at 8:58 pm | Permalink

        You have some strange ideas Uni
        1.The CAP is said to add a large amount onto the cost of food in Europe.
        So getting rid of it will bring down the cost of food.

        2.You say energy prices are high because of a lack of competition so more competition will bring down the costs of energy

        3.Any increase in the number of homes built will increase supply at a time when demand is rising and will therefore help to reduce prices for all.

        • uanime5
          Posted March 19, 2013 at 6:58 pm | Permalink

          1) The CAP subsidises farmers so if you remove this subsidy then farmers will have to charge more to make up for the loss of this subsidy. Prices do not go down when subsidies are removed.

          2) Using different energy sources isn’t the same as more competition.

          3) If you only build houses that millionaires can afford this will only reduce the prices of house for millionaires; not house for the average person.

  11. Jerry
    Posted March 18, 2013 at 8:25 am | Permalink

    John, regarding that old adage, you are quite correct but what if the man lives by a river that has private fishing rights, give the man all the rods you wish but he will never be allowed to fish for himself unless he is first admitted to the club, the same is very true of the business world, until government and society makes it very much easier for established companies to expand and take on staff, for new start-up companies to both find premisses and capital, for people to become self employed etc. it is like that half staved man and his fishing rod looking enviously over at a river teaming with fish but from the wrong side of the “No Fishing Allowed – Members Only.”” sign…

    Please do tell me that there is going to be some progress on that bonfire of red tape and regulation we were promised, at times it still seems that the government are operating with the old Labour policy of one Headline pieces of red tape or regulation out but two new ones put in its place by stealth. 🙁

  12. English Pensioner
    Posted March 18, 2013 at 9:47 am | Permalink

    One of the problems is defining poverty, which is at present determined by reference to the average pay. But when you see occasional TV pictures of people in poverty, they all appear to have their large TV sets, computers, mobile phones, etc, which are hardly signs of poverty.
    I was brought up during the wartime years with the bare essentials in life in terms of heating, food, clothing, etc whilst living in a cottage with outside toilet and a pump outside the back door for water. We didn’t consider ourselves to be in poverty, yet we didn’t have any of the modern “essentials” without which one is apparently living in poverty.
    A lot of so-called poverty is the inability of those concerned to manage their own affairs with the result that they spend money on non-essentials. I think that there are strong arguments for the US system of having food stamps and the like rather than cash benefits.

    • uanime5
      Posted March 19, 2013 at 7:00 pm | Permalink

      I think that there are strong arguments for the US system of having food stamps and the like rather than cash benefits.

      Given that the US abandoned this system because people were circumventing it by selling their food stamps for real money the evidence clearly shows that it won’t work.

  13. Tad Davison
    Posted March 18, 2013 at 10:49 am | Permalink

    John,

    I cannot find much wrong with your sense of logic, as I have always taken much the same view myself. The only exceptions, are perhaps the disabled, the elderly, or the young, who for reasons beyond their control, cannot possibly provide for themselves.

    Where people can provide for themselves, they have a moral obligation to do so, but increasingly, I get the impression disabled people are being forced into an ever-diminishing space. Their living standards are being eroded, where in a decent and civilised society, we should lend them every assistance.

    The people who should be put under pressure, are the ones who can provide for themselves, but don’t. The ones who don’t take up paid employment, and leave the vacancies to be filled by the likes of Eastern Europeans.

    On the BBC’s Question Time recently, Ken Clarke remarked that those from other parts of the EU claim far less benefits than our own people, surely indicating there’s a problem with the work ethic of the latter. That was borne out by Frank Field, who discussed the issue of job take-up with some of his younger constituents. One of whom leant over the table and asked, ‘Do you want us to work for immigrant wages?’

    I would say, firstly, there’s a problem with job take-up that the government needs to address. When my lad graduated in 2009, he took two poorly-paid, menial cleaning jobs rather than go on the sausage roll and claim benefits. He demonstrated his willingness to work, and wasn’t too proud to take anything. Gradually, he got better and still better jobs. He’s now the UK sales manager with a very high-end audio-manufacturing company with good prospects and global travel, so let no-one tell me the opportunities don’t exist!

    It is still far too easy for some people to absolve themselves and abdicate any responsibility for their own futures or circumstances, and then moan about being poor. Being able to work but not working, should not be an option, just as disabled people who cannot work shouldn’t be pressed to do so, for that too, is not an option. So as far as the state’s responsibility is concerned, it boils down to the deserving, and the undeserving poor. Unless one is within the categories listed above, the best way out of poverty is to graft, just as my own kids do.

    Tad Davison

    Cambridge

    • alan jutson
      Posted March 18, 2013 at 8:59 pm | Permalink

      Tad

      Agree with much of what you say.

    • uanime5
      Posted March 19, 2013 at 7:04 pm | Permalink

      If the only way to get a good job is by working in menial ones then what’s the point of getting a degree when your career path is the same as someone who barely got their GCSEs. The UK will continue to have a brain drain and decline if being educated doesn’t improve your career prospects.

  14. Neil Craig
    Posted March 18, 2013 at 11:01 am | Permalink

    A consistently unmentioned factor in the supply/teach to earn fish (or anything else) is that the former guarantees continuous employment to “professional carers” and other government employees. This can hardly fail to bias them towards dependency cutlure.

    As pointed out re your debate with Ms Blears, places which receive endless inputs of government money do not thereby end up better off than those who don’t, if anything the opposite.

  15. behindthefrogs
    Posted March 18, 2013 at 11:29 am | Permalink

    Recent reports on children who should be receiving free meals indentified huge numbers who did not because their families were not in receipt of benefits. In particular in your own constituency, one of the richest in the UK, it was calculated on one particular council estate 45% of the people were living below the poverty line.

    There are many actions that need and can be taken to improve this situation.

    1) Arranging for the unemployed to sign on locally instead of having to spend some of what little money they have travelling to a job centre some miles away.
    2) Taking positive action to improve the situation with regard to improving the tjings that are claimed to contribute to the poverty. For example local GP practices hold smoking clinics. Take these to the estate and advertise them there.
    3) There is a job centre on the edge of the estate but that is aimed, perhaps not deliberately, at helping the intellectually able in their job searches. In a town that is short of labour at the bottom level charity run job centres need to provide help to those who need it most.
    4) these sink estates need to be broken up and affordable housing provided in the general community. The Eustace Crescent redevelopment will emphasise the divide rather than improve it.

  16. alastair harris
    Posted March 18, 2013 at 12:53 pm | Permalink

    not sure why this evokes an image of canute imploring the tides to go away – but it does!

  17. Normandee
    Posted March 18, 2013 at 1:01 pm | Permalink

    How many poor people have been imported by the last government, and continue to be imported by this government. When we have more jobs that those available for work we can invite people suitably qualified to come and work here, and as has been the case they may vote for you, because you supplied a job, not benefits.

    • Bazman
      Posted March 18, 2013 at 8:40 pm | Permalink

      Probably not many. The type of East European who comes here does not like to be unemployed. The unemployed ones stay unemployed at home like here.

      • A different Simon
        Posted March 19, 2013 at 12:15 pm | Permalink

        Bazman ,

        I am sure you are right about that .

        This should however make us question the established sales pitch that it is in a poor countries interests to join the EU .

        Just as go-getting young folk in the UK generally move from villages and towns to big cities , go-getting young folk in poor countries are likely to move to richer countries .

        The net effect could be an impoverishment of the small countries who are in essence systematically stripped of their talent .

        So many of these things are subject to the law of unintended consequences ; and you have to question whether the richer countries don’t know exactly what they are doing and have less than honourable intentions .

        Just look at what the IMF did to Africa .

  18. cosmic
    Posted March 18, 2013 at 1:22 pm | Permalink

    You have to define a problem before you can tackle it. Define poverty, which can be done in relative or absolute terms.

    If that’s not done you are doing something like “aiming for a fairer society”. It sounds pretty good and no one is going to argue for a more unfair society, but if you can’t explain what it is other than with blandishments, what exactly are you proposing?

  19. Antisthenes
    Posted March 18, 2013 at 2:51 pm | Permalink

    Obviously yours is the sensible approach but you try telling that to the left and the other assorted loons. We have been full on on the care approach and now we have an unstable and unsustainable economy and society where everybody is becoming poorer which of course effects the poorest most of all. We have seen how the tough approach works it has taken billions out of poverty and as long as that then changes to a caring but prudently so system then that will not reverse. It is to be hoped that developing nations learn from the mistakes of the developed nations and not squander their wealth on ill though out social engineering.

  20. CHRISTOPHER WHITE
    Posted March 18, 2013 at 3:00 pm | Permalink

    An American commentator has said that workfare gave the biggest boost to Afro-American incomes ever & clearly President Clinton would not have done it if he hadn’t believed that it would be beneficial.

    • uanime5
      Posted March 19, 2013 at 7:07 pm | Permalink

      Were those on workfare in the USA paid minimum wage or nothing? If the former than why were they paid nothing in the UK?

  21. uanime5
    Posted March 18, 2013 at 3:34 pm | Permalink

    Osborne could make working more worthwhile by raising minimum wage at the rate of inflation, rather than a few pence every year, to ensure that the lowest paid are still getting paid the same amount in real terms. Replacing the minimum wage with a living wage, 60% of the average wage, would be even better.

    Energy costs can be reduced by introducing more competition among the foreign owned energy companies. Perhaps by creating a state owned energy supplier.

    • Mark (high horse) W
      Posted March 18, 2013 at 7:16 pm | Permalink

      A state owned energy supplier. Well the CEGB was a huge success.

      • Jerry
        Posted March 18, 2013 at 10:44 pm | Permalink

        @Mark W: Indeed it was, we actually had a surplus of power stations built in the days of the old CEGB, never mind the interrogated distribution system (completed), the only reason the lights went out in those days was due to industrial action, not because of lack of investment/generating capacity – as seems likely to be the case within the next few years…

        • A different Simon
          Posted March 19, 2013 at 12:32 pm | Permalink

          Jerry ,

          The retailing side of energy seems to be a utility function so should only attract utility profits . The profits are excessive for a utility function and I think they should have to print on our bills how much they have spent on advertising , an expense we did not have with nationalised utilities .

          As far as energy exploration is concerned I think that is best handled by the private sector .

          If the UK goes forward with it’s smart grid I don’t have any confidence in UK policy makers to ensure that interfaces between consuming and generating objects and grid management systems would not be proprietary .

          This could become a matter of national security – the risk of changing grid management companies would to too great so we would become locked in to the grid supplier forever .

          I have no problem with interconnects with countries like France but I don’t want the UK/EU/Global superstate having control over my energy from a central location .

    • Edward2
      Posted March 18, 2013 at 9:00 pm | Permalink

      If we raised the minimum wage to say £15 per hour we could all be rich and if we made the maximum hours 25 per week all unemployment could be eliminated.
      Or am I having a fantasy Uni?

      • uanime5
        Posted March 19, 2013 at 7:11 pm | Permalink

        You need to earn more than £15 per hour to be considered rich and you can eliminate unemployment by making it illegal for non-directors to work overtime (more than 37.5 hours per week).

    • alan jutson
      Posted March 18, 2013 at 9:02 pm | Permalink

      Unanime 5

      Better still just increase the personal tax allowance to the minimum annual wage.

      ie minimum wage earners pay no taxes.

      Then we all benefit for working.

    • Behindthefrogs
      Posted March 18, 2013 at 11:22 pm | Permalink

      The living wage is 60% of the mean wage, not 60% of the average wage.

      • Leslie Singleton
        Posted March 20, 2013 at 6:56 pm | Permalink

        Behindthefrogs–When I went to school there were three “averages”, viz mean, median and mode so I struggle to understand your point.

    • Lindsay McDougall
      Posted March 20, 2013 at 4:20 pm | Permalink

      How does creating a state owned anything reduce costs?

  22. Terry
    Posted March 18, 2013 at 7:39 pm | Permalink

    Poverty? What is poverty? Poverty, is a relative word.

    We might consider an African living on just $2 per day to be in poverty. Or a Romanian living on the same wages, also in poverty. But we must learn to think outside of the box. That money they earn in their own country could well be more than enough to feed and house them and their families.
    So, we should really turn our attention (As should the EU, also) to the relative costs of living in all of these so-called, “poorer countries” and compare them with our own. They will not match. Inflation has destroyed our purchasing power.

    Besides, why do we we have to force our will upon them and give them money (aid) for nothing?
    It took Britain 2000+ years to get where we are now . The UK population went through the all of same turmoils that the ’emerging nations’ are suffering now but we learned and developed ourselves out of them. Why can’t they do the same?

    To expect such new nations to jump the natural progression required to learn their own way, is to invite problems. They are not easily taught, more forced to run, before they can even walk. To jump, say a 100 year natural learning curve is to invite problems because the recipients will be out of their depth and unable to comprehend our “modern ways”. (criticisms of given countries removed-ed)
    We have already done enough, probably much more than enough, to “help” these emerging nations. Now is the time for them to shape their own destiny without our help. And it long past time for our Government to actually concentrate of getting its own citizens out of British relative poverty and I cannot think of anyone more important to Britain than the British citizen. I hope the Government can see that too.

  23. margaret brandreth-j
    Posted March 18, 2013 at 8:28 pm | Permalink

    Poverty .What is poverty? If people are fed , housed in a warm environment and clothed ,then they are not poor,right? No wrong except perhaps in those countries where every mouthful of rice or powdered milk delays death by another day.
    Management of money in the home is an all important factor. Home economics should be fastidiously taught in schools, so that pupils know the difference between durables and non durables. Priorities in spending should be encouraged ,so that cigarettes, alcohol sweets and crisps do not automatically become part of the weeks shop.
    I have seen much local poverty , but it seems to go hand in hand with dirtiness , sluvenliness and clutter ..Why is this? I cannot understand why organisation and cleanliness should be for the better off only.My grandparents lived in a council house and one shilling could be stretched for miles. The house was immaculate and there was absolutely no waste, yet i have seen piles of dirty clothes on floors, boxes of old magazines, broken bric a bric, cigarette ash, jars of sweets, old wrappings strewn over surfaces , fridges full of fillet steaks going green and sausages in houses of the poor..someone enlighten me!

    When I was thrown out of my lovely marital home following (problems-ed), I became a struggling single parent. I am a Nurse so found it easy to get a job and a 100% mortgage and tried as well as I could and without help from my ex husband and his new well paid wife, however to buy my own house from scratch again and keep my children out of a (difficult-ed) council house area, I often went hungry. The hospital trolley where I worked hard to feed others often had food left . On hungry days I could eat these scraps . If I was caught this was punishable, but I usually asked the kitchen staff as they collected the trolley. Oneday I asked if I could have a sandwich which was left instead of selling it for pig food, the reply was ” we don’t sell for pig food any more , it goes in the bin and that is where you will have to go for it if you want it”
    Someone of course will become upity about my observations and even talk about law being the law, but if this is not you,well you are not part of my life’s ethnography.

  24. Electro-Kevin
    Posted March 18, 2013 at 8:53 pm | Permalink

    Of the most impoverished in this country are those in low paid work or retired from work.

    Those who have never worked can do surprisingly well.

  25. Christopher Ekstrom
    Posted March 18, 2013 at 11:54 pm | Permalink

    Give yourself a break, Mr. Redwood. You simply cannot & will not “eliminate poverty”. You can’t even convince your obtuse misleader to exit the EU straightjacket & iniate a golden age of prosperity for England. I like you; but this reads like your an utter Wally!

  26. Christopher Ekstrom
    Posted March 19, 2013 at 3:03 am | Permalink

    This is the first post I have encountered on your blog that is utterly ridiculous. You are failing in the fight to sever ties to the EU & maintain sovereignty for England. You have utterly failed to convince your misleader to cut taxes, cease green self-flagellation & free your fellow Subjects from dear energy, or even proper regulation of RBS (etc.). Meanwhile UKIP is nipping at your heels. Are you losing the plot?

  27. Lindsay McDougall
    Posted March 20, 2013 at 5:52 pm | Permalink

    How much does poverty matter? Is it worth wrecking entire markets – health and transport come to mind – just to cater for the poor? I think not. What do other people think?

  • 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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