Thursday, April 30, 2009

Tories plan cuts for families

Senior Tory David Davis wrote an article in the Financial Times about what he thinks his party should do if they win power to save the government money.

The main saving which he proposes is to end what he calls 'welfare for the well off' by means testing child benefit and winter fuel payment and free TV licenses for pensioners. He says this will "save" £9-10 billion per year, by which he means that the government will take £9-10 billion off parents and pensioners.

Means testing child benefit so that only the poorest families get it would cost the average, middle class family with one child more than £1,000 per year. It would require the government to hire a load of bureaucrats to decide who is eligible and who isn't, plus extra spending on advice and information to make sure people who are eligible actually claim it. Based on data from take up of other means-tested benefits, about a quarter of the poorest families would not receive the benefit if it were means-tested. It is also a directly anti-family policy to make those with children contribute more than those who earn the same but don't have children to raise.

So cutting 'welfare for the well off' involves a massive raid by the government on the money which middle class families have to live on and look after their kids; hiring more bureaucrats and taking money away from the poorest families who need it the most. The spin is very different from the substance.

But, of course, from the Tories' point of view, it has one big advantage over, say, raising income tax by 2p. For a single parent earning £25,000 per year, or a couple with combined earnings of £45,000, losing £1,000 or more is a heavy blow. But for those earning £100,000 or more, it's much less of a problem. And when it comes to tough decisions about who needs to pay more in the years ahead, Tories like David Davis know exactly whose side he is on.


At 8:42 pm , Anonymous Chris Baldwin said...

Personally I think the Tories ought to propose to emulate Mrs Thatcher and set the top rate of income tax at 60%.

At 8:54 pm , Blogger Robert said...

Bit like Labour telling single mother work bitch or die, telling the disabled the gravy train is over get a job, whoops where is my new bath plug, my New Plasma, my new home. Good I can put my feet up now, phew what can I buy next off expenses.

The fact is New labour can say sod all about what the Tories might or might not do, I'm sure New Labour has thought of it, and might well do it.


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