Benefits

Wednesday

Peter Hoskin

Cameron stumbles onto the stage

Who’d have guessed that David Cameron would go into his conference speech on the backfoot? This was supposed to be a moment tinged, if anything, with jubilation: the first Tory PM for thirteen years addressing a party that seems to have fallen in love with him. But instead we’ve got the child benefit row, and with it apologies, rebuttals and hasty repositioning. It is to Cameron’s credit that he can breath the two words that evade other, more culpable politicians: “I’m sorry”. But on the eve of his big speech? Far from ideal. This exercise in damage limitation may have slightly eased Cameron’s situation today – but it has put

Tuesday

Peter Hoskin

IDS sets out his vision for combating poverty

There was a quiet momentousness about Iain Duncan Smith’s speech in Birmingham today – even before he started speaking. When IDS resigned the Tory leadership in 2003, he could barely have imagined that he would one day address his party as a leading member of the government. Even a few weeks ago, he couldn’t have been sure that the coalition would implement the policy agenda that he developed during his time at the Centre for Social Justice. Yet here IDS was, receiving a standing ovation for his efforts. What a difference seven years make. And then to the speech itself. Much of it reverberated to the same reforming drumbeat that

James Forsyth James Forsyth

This is not a 10p tax moment

Last night, one minister came up to me nervously and asked, ‘is this our 10p tax moment?’ He was talking, obviously, about the decision to take child benefit away from households with a higher rate taxpayer in them.   My answer was no. The comparisons with Brown’s removal of the 10p tax rate miss a crucial point: Brown tried to hide what he was doing. In his final Budget statement to the Commons, the abolition of the 10p rate wasn’t even mentioned. Instead Brown boasted about a 2p reduction in the basic rate, to huge cheers from the Labour benches.   By contrast, the Tories have been upfront about the

Peter Hoskin

Cameron tries to defuse the child benefit row

Whether you agree with the plan to restrict child benefit or not – and, broadly speaking, I do – there’s little doubting that it has met with some fiery resistance in the papers today. The Telegraph leads the attack, calling it “a hastily conceived about-turn bundled out on breakfast TV”. The Daily Mail highlights the “blatant anomaly,” currently riling up the Mumsnet crowd, that a single earner family on £44,100 a year might lose the benefit, while a dual earning family on £87,000 can keep it. And the Independent does likewise. It should be said, though, that the Sun, the Times and the Financial Times are considerably more generous about

Monday

James Forsyth

Withdrawing child benefit at 16 would be the wrong call

In the last few weeks, there has been much speculation that child benefit would be stopped when a child reaches 16. Today’s announcement suggests that this is not going to happen, although the Tories are refusing to rule it out. If there are to be changes to child benefit — and given the financial situation there need to be — then removing it from households with a higher rate taxpayer is a better move than stopping it at 16. Child benefit ending at 16 would send out a message that at 16 a child should start earning its way in the world. This would, for obvious reasons, have a negative

James Forsyth James Forsyth

The beginning of the end of universal benefits

The most important line in George Osborne’s speech was this one: “It’s very difficult to justify taxing people on low income to pay for the child benefit of those earning so much more than them.” Logically, this argument applies equally to all other universal benefits. Why should someone on £12,000 a year be paying tax to help cover the cost of Ken Clarke’s pension? Personally, I’m quite happy to see universal benefits go. The end of universal benefits would, though, change the nature of the welfare state. Quite rapidly, it would become a safety net not a contributory system. This is why Labour will oppose so vigorously taking child benefit

David Blackburn

Is there an alternative to cutting child benefit?

Beware a mother scorned. George Osborne’s copping some stick on Mumsnet, social forum for the Latte-drinking classes, and with good reason. ‘Hard-working families’, many of them far from rich, will feel abandoned by the party that ought to be theirs. IDS, Cameron and Osborne have taken a huge a political gamble, as James noted earlier, and they have also taken an enormous social risk. It is telling that the Centre for Social Justice, IDS’ think tank, are lukewarm about the proposal, describing it as ‘probably appropriate’ but calling for an alternative.  Skipping through the comments on Mumsnet and you can see why. Many of those whose combined income is roughly

Peter Hoskin

Welfare dominates Osborne’s speech

George Osborne delivered everything we expected, and then some. This was a confident and wide-ranging speech from a Chancellor who has suddenly discovered a central message: what’s right about burning £120 million of taxpayers’ cash in debt interest payments every day? Wouldn’t it be better to get to grips with that waste as soon as possible? And that message percolated down through everything from his attack on Ed Miliband to his case for reforming our public services. “It’s like a credit card,” Osborne growled, “the longer you leave it, the worse it gets.” But if that was the theme of Osborne’s symphony, then the motif was certainly welfare. Huge chunks

James Forsyth James Forsyth

Osborne’s benefit risk

George Osborne’s announcement that child benefit will be taken away from any family with a higher rate taxpayer in it to help fund welfare reform shows how far Cameron and Osborne were prepared to go to keep Iain Duncan-Smith on board. During the campaign and in the Budget, Cameron and Osborne had strongly implied that child benefit would remain universal. The move carries it with considerable political risks. The measure takes effect from 2013, so before the country will have seen the benefits of welfare reform. Also families with one earner on £44,000 a year don’t consider themselves to be rich; there is already considerable irritation at how Gordon Brown’s

Fraser Nelson Fraser Nelson

Osborne can go even further on middle-class benefits

George Osborne had been expected to subject child benefits to tax. Instead he is to abolish them entirely for higher-rate taxpayers. I’ve spent this morning talking to friends, whose judgment I respect, who are furious about Cameron hitting the squeezed middle. I cannot agree, and here’s why. We are not talking about the “squeezed middle” here – of the 30.5 million income tax payers in Britain, just 3 million pay the top rate of tax (figures here). They’re the best-paid 10 percent – and I have never worked out why the tax of the average worker (who’s on £22k) should be higher to afford the payment to those on twice

Peter Hoskin

Osborne takes to the stage, armed with cuts

Rewind the tape to last year’s Tory conference, and David Cameron was assuring us that, “It will be a steep climb. But the view from the summit will be worth it.” Today, it falls to George Osborne to tell us more about both the arduousness off the ascent and the beauty of that view – although I expect that there will be a heavy empasis on the former. Already, the main passages are spilling into the papers and, as you’d expect, it’s mostly cuts and debt. On that front, the main argument seems to be similar to that made by Nick Clegg in Liverpool: that the longer it takes us

Sunday

Fraser Nelson

How Osborne and IDS reached agreement

I have found out a little more about the Universal Credit – and how the arguments over the summer were resolved. First, the backdrop. Money was always going to be a problem. This policy is about saving lives, not money. Right now, we pave the road to welfare dependency, creating a vacuum in the labour market that sucks in workers from overseas. Under Brown, the Treasury accepted this: cheap workers pay tax too, and as do companies who profit from them. Result: tax receipts up, but never fewer than 5 million on out-of-work benefits throught the boom years. The IDS plan was not sprung on Osborne. As I blogged a

Fraser Nelson Fraser Nelson

Society 3, The State 0

Cameron and Osborne may just be about to pull off something incredible. This time last year, The Spectator ran a cover story about a new proposal which we could revolutionise welfare: the Universal Credit. It was an IDS idea: he’d sweep away all 50-odd benefits, and replace it with a system that ran on a simple principle – if someone did extra work, they’d get to keep most of the money they earned. It meant a bureaucratic overhaul, of a system that controls the lives of 5.9 million people. The resistance from HM Treasury, the architect of the tax credit system, was as fierce as it was predictable. But Clegg

Sunday

Peter Hoskin

Ed Miliband tries to detoxify his brand

The scrubbing job starts in earnest this morning, as Ed Miliband tries to erase that “Red” epithet from before his name. Exhibit A was his appearance on the Andrew Marr show, in which he took every opportunity to cast the manner of his victory in a favourable light. “If you look at this as one vote-one member, then I got more votes than anyone else,” he assured us, before going on to say that he won the union vote because, “I spoke about things that matter to working people in this country.” When asked whether he would sway under pressure from the union leadership, he averred, “I’m nobody’s man, I’m

Thursday

Peter Hoskin

Clegg gets forceful over welfare

Enter Nick Clegg with another self-assured article for a national newspaper. A few weeks ago, it was his defence of the coalition’s Budget for the FT that caught the eye. Today, it’s his case for welfare reform in the Times (£). These may be arguments, about dependency and disincentives, that you’ve heard before – but here they’re packaged in a particularly clear and persuasive way. Just what’s needed as the welfare wars, between Labour and the coalition, spill back into newsprint.   Writing about the article, the Times frames it as “Nick Clegg [putting] himself on a collision course with his party” – and you can see why they might

Wednesday

Peter Hoskin

Another difference of opinion on welfare?

For the briefest of moments, the welfare war seemed to have quietened down. But, this morning, a new front may have flared open. Answering questions from the work and pensions committee, Iain Duncan Smith has struck out against the figures for benefit cuts that emerged at the weekend. The Guardian’s Haroon Siddique reports: “During questioning by the work and pensions committee, Duncan Smith was at pains to play down newspaper reports that he and Osborne were at loggerheads with each other. But when asked by committee chair Anne Begg about a variety of figures that had been ‘bandied about’ including the £11bn savings set out in the June budget and

Monday

Peter Hoskin

Osborne and Cooper’s knockabout

Far more heat than light generated by this afternoon’s urgent question on welfare spending – but a telling spectacle nonetheless. The question had been put forward by a dissenting Lib Dem voice, Bob Russell, and it was up to George Osborne to answer it. He did so with sweeping observations, and attacks on Labour, rather than specifics. And so we never really got into the small print of those £4 billion extra benefit cuts, but Osborne did wonder why Labour have never apologised for “leaving the country with the worst public finances in its history.” It was knockabout stuff.   This is not to say that Osborne was ineffective. In

Peter Hoskin

The coalition faces its most important battle of the next five years

Strolling through central Birmingham yesterday, I came across one of those brewery advertisements from the early part of the last century. “Unspoilt by progress,” it boasted – a slogan that popped into my head when I heard the unions’ various interventions this morning. As Iain Dale suggests, there is something very 1970s about what Crow, Barber, Serwotka & Co. are saying today. The coalition will need to meet much of the unions’ belligerence with some fire of its own. David outlined some ways it can do that earlier. But, to my mind, there is one charge that demands a particularly ferocious counterattack. It’s the one made by Brendan Barber in

Sunday

David Blackburn

Benefit reform – one theatre in Cameron’s war

The Observer has received letters revealing that George Osborne plans to deliver net savings of ‘at least £2.5bn’ from the Employment Support Allowance by limiting the amount of time people can spend claiming it. Here is Osborne’s letter to IDS, Cameron and Clegg: ‘Given the pressure on overall public spending in the coming period, we will need to continue developing further options to reform the benefits as part of the spending review process in order to deliver further savings, greater simplicity and stronger work incentives. Reform to the employment support allowance is a particular priority and I am pleased that you, the prime minister and I have agreed to press ahead

Tuesday

Eamonn Butler

The family is the best agent of welfare

Conservatives have long been strong on family. They believe that families are the glue that sticks us together, and that traditional nuclear families therefore plays an important role in sticking the whole nation together. As a libertarian, I believe that people should live as they choose. Too many young people of my parents’ and grandparents’ generations were forced into marriages that were or became deeply unhappy – but divorce was thought scandalous. So people – particularly women, who rarely had independent means or income enough to escape – endured that misery. Many, too, were humiliated, or prosecuted, for conducting relationships that we would happily accept today. But even as a