Excellent and plausible analysis of splits within the Conservative party over which wing of the Tories hue moral authority to push through welfare reform......
http://www.telegraph.co.uk/news/politics/9762509/Iain-Duncan-Smith-has-to-win-the-day-in-the-Tory-war-over-welfare.html
Many of the most important political changes are the ones that never get announced. Like a shift in cloud cover that causes the ball to swing and suddenly brings about an apparently inexplicable clatter of wickets in a Test match, nobody notices before it’s too late.
One such invisible disruption has just taken place at the heart of the Coalition: George Osborne, the Chancellor, has quietly added the Department for Work and Pensions to his long list of responsibilities. Of course, Iain Duncan Smith, the Work and Pensions Secretary, remains formally in charge, but his departmental philosophy, finances and – most disastrous of all – the language of welfare reform, are all in danger of falling into the hands of the Chancellor.
An early indication that a takeover bid was in progress came in the Budget last March when the Chancellor announced, without consulting the Work and Pensions Secretary, or for that matter anyone else, that he planned to knock £10 billion off the welfare budget. Then Mr Osborne attempted to replace Mr Duncan Smith with a yes man.
At first, this plan went well. Mr Osborne told the Prime Minister that Mr Duncan Smith should go. David Cameron duly used the September Cabinet reshuffle to offer him another job. Mr Duncan Smith, very shaken, asked to go home and think about the move overnight.
He might conceivably have complied but for the fact that, while mulling over his conversation with the Prime Minister, he chanced to turn on Newsnight, where Daniel Finkelstein, political columnist and executive editor of The Times, was sounding off about the need to find a new work and pensions secretary. Now Mr Finkelstein is viewed around Westminster not only as a clever and charming man, but also as the most important public apologist for the Chancellor of the Exchequer, to whom he speaks very regularly and is believed to give advice. (Mr Finkelstein later denied having discussed Iain Duncan Smith with the Chancellor.)
Mr Duncan Smith, having heard Mr Finkelstein vent unfriendly opinions about his job prospects, resolved there and then to stay put. There matters rested for several months. Relations between the Treasury and the Department for Work and Pensions, never warm at the best of times, grew chilly. At the heart of the coolness was a difference in philosophy. Mr Osborne sees welfare reform as an accounting issue. Mr Duncan Smith, by contrast, has a deeper and richer vision.
A committed Christian, he ultimately understands his task in terms of human redemption. He does not believe that people are out of work because of their own fault. He believes that the vast majority are victims of a cruel system, partly created by Gordon Brown, which creates perverse incentives that encourage men and women to stay away from the job market. Mr Duncan Smith believes it is his life’s work to end this monumental tragedy, and to provide the best environment for the unemployed to find work and obtain the human dignity that a job brings with it.
Hence his so-called “universal credit”, a single system of payments to the out-of-work and poorly paid alike, which will end the anomalies and perverse incentives of the system inherited from New Labour, and is due to be introduced next year. It is based on the same principles as the system advocated by Frank Field, another devout Christian who worked briefly at the Department of Social Security (as it then was) in 1997/98 before being politically eliminated by Gordon Brown.
It is fair to say that Mr Osborne now wants to do to Mr Duncan Smith what Gordon Brown did to Frank Field 14 years ago, and for the same reason. The Treasury has always hated the idea of the universal credit, mainly because it is expensive. It is no coincidence that Sir Jeremy Heywood, the Cabinet Secretary, a former Treasury official who served for many years under Mr Brown, is one of George Osborne’s closest allies in this increasingly vicious Whitehall war.
The Chancellor bided his time – then struck once more in the Autumn Statement at the start of this month. Mr Osborne moved on two fronts. The first was financial, with the 1 per cent benefits freeze. I understand that Mr Duncan Smith has reluctantly accepted that these cuts are unavoidable at a time of economic austerity. What dismayed the Work and Pensions Secretary, by contrast, was the unfortunate language used by the Chancellor of the Exchequer.
Mr Duncan Smith has been very careful indeed when talking about the workless and unemployed. He has always used the language of redemption, of lifting people off the scrap-heap and giving them a chance to reach their full potential. This is a vocabulary which he developed during the long years when, after being deposed as Tory leader, he toured housing estates, founded the Centre for Social Justice, brooded on the social problems that confront us as a nation and overcame (I guess) some kind of personal crisis of his own.
During this time I used to talk regularly to Mr Duncan Smith, and I noticed that he never once blamed the out-of-work or poverty-stricken for their plight. On the contrary, he went to extreme lengths to identify the causes of their problems, so he could help them find a way out of it. It is unthinkable that he would ever have sought to draw a moral distinction between the working poor and the unemployed – those who stay at home, in the vindictive phrase used by Mr Osborne, “with their curtains closed, sleeping off a life on benefits”.
This distinction between shirkers and workers is now becoming part of Conservative Party strategy. Last weekend, the newly appointed Tory chairman, Grant Shapps, launched a poster campaign with the slogan: “Time to end Labour’s something for nothing culture”, involving photos of idle young thugs, contrasting them with beatific portraits of white, hard-working families.
I am told that when Mr Duncan Smith learnt of this campaign he was, in the words of an ally, “absolutely livid”. After a series of internal rows, the posters are now likely to be ditched. This is, however, very dangerous territory for the Coalition, and it is clear that Iain Duncan Smith is fighting the battle of his life.
I believe it is very important that he survives. There are, at the heart of this Government, only three majestic ideas. The first is the restoration of the public finances, a task to which the ugh Chancellor, strikingly, does not devote his full-time attention. The second is the grand programme of educational reform, masterminded with such admirable courage and verve by Michael Gove.
The third is welfare reform. At the moment Tory high command, egged on by the Chancellor, is trying to take this programme out of the hands of Mr Duncan Smith and use it as a cynical tool to win votes by targeting the vulnerable unemployed. It is time that David Cameron intervened decisively in this rancid Conservative row.
The Prime Minister surely realises that the Tories will never win the argument on welfare if they advocate the cynical language of George Osborne and Grant Shapps. But they would deserve to do so if they stick to Mr Duncan Smith’s far nobler assessment of human motivation. Mr Cameron must remember this: if he lets Iain Duncan Smith’s vision of welfare reform die, the finest part of the Conservative Party will die with it.
Wednesday, 26 December 2012
Wednesday, 19 December 2012
Thursday, 13 December 2012
Coalition and fuel duty Dec 2012
Important:
Conservative consultation document 2008.
Freight Transport Association document that was published before the autumn statement 2012 (when Osbourne) cancelled the planned 3p rise in fuel duty. Includes good explanation of the fuel duty stabiliser.
Guardian article on the cancellation of aforementioned rise in fuel duty November 2012.
Excellent summary here.
- Fuel duty escalator - above inflation increases to fuel duty - cancelled in 2000 following protests. From then on no automatic increases were added to petrol - they were handled on a budget-by-budget basis.
- Governments have still increased duty on petrol. Yet, this is not as much nor as 'automatic' as it used to be under the escalator system.
- Cons manifesto 2010 promised a 'fair fuel stabiliser'. It was introducedin the March 2012 Budget. What did this mean? Well, it did not mean an end to fuel duty increases. The government can and will increase fuel duty at some point (as of Dec 2012 it stands at around 57p per litre). The 'stabiliser' simply means that when oil prices are high, fuel duty will increase by RPI inflation only. However, if the oil price falls below a set trigger price on a sustainable basis, fuel duty will be increased by RPI plus one pence per litre in each such year. So really it is designed to function when fuel prices are high.
- Oil prices are currently high. HOWEVER, the Chancellor has either postponed or cancelled several fuel duty rises since 2010. Thus the fuel duty stabiliser has not yet been employed. As and when the government do raise the fuel duty THEN the fuel duty stabiliser will be referred to.
- So it is designed to limit fuel duty when oil prices are high and then let fuel duty increase when price of oil is low. Environmentalists argue that this will not disincentivise road use which is what they argue fuel duty should be used for.
Conservative consultation document 2008.
Freight Transport Association document that was published before the autumn statement 2012 (when Osbourne) cancelled the planned 3p rise in fuel duty. Includes good explanation of the fuel duty stabiliser.
Guardian article on the cancellation of aforementioned rise in fuel duty November 2012.
Excellent summary here.
The fuel duty stabilizer
Written by Dr Eamonn Butler | Thursday 3 March 2011
I'm against any tax of any size on any thing for any reason, but I do not think that messing about with taxes like this is a good idea, nor do I think that it will work. Fuel duty – the government tax levied on hydrocarbon oil – is now around 59p per litre. And then there is the new, higher rate of 20% VAT on both the price of the petrol and the duty. So the total tax is far more than the cost of the fuel itself. Indeed, petrol is taxed at a rate equivalent to 175%. (That's a far higher rate than could be justified under any environmental criterion, by the way: if we had simply a 'carbon tax' on fuel, it would be very, very much cheaper!) So, say campaigners, the present tax on fuel amounts to quite a chunk of cash that, arguably, the government could shave off in order to counteract the effect of rising oil prices and stabilise the price at the pump.
There is a flaw in this argument, though. Nobody really knows where the price of oil is going. There is no 'natural' or 'just price' one can use as a reference point for the decision on whether taxes should be cut, or then restored. The price of fuel is volatile in the short term, and over the long term it sometimes trends down and sometimes trends up. If it carries on like it has been, the government would lose billions by trying to stabilise the price by cutting taxes. And should it do so anyway? Part of the idea of rising prices is that they reveal increasing scarcity – and encourage people to look for alternatives or to economise on the use of the commodity in question. That is why, when you allow governments to try to manipulate prices, you always get trouble.
Sunday, 9 December 2012
Nov 2012: Energy Bill video
http://www.bbc.co.uk/news/business-20538037
Summary:
Renewable energies to be relied upon (wind and nuclear) - to be paid for by consumersthrough bills. Good for energy industry.
Summary:
Renewable energies to be relied upon (wind and nuclear) - to be paid for by consumersthrough bills. Good for energy industry.
Energy minister Ed Davey has unveiled the government's much-trailed Energy Bill, setting out the roadmap for the UK's switch to "a low-carbon economy".
Energy firms can increase the "green" levy from £3bn to £7.6bn a year by 2020, potentially increasing annual household bills by £100.
However, big, energy-intensive companies could be exempt from the extra costs of the switch to renewable energy, as John Moylan reports.
Nov 2012: Energy Bill and Labour opposition
A lack of clarity over the decarbonisation of the energy market will "push bills up", Labour has said.
Shadow energy secretary Caroline Flint told BBC News that she welcomed the Energy Bill, but the cost of energy for customers interests had not been adequately addressed.
Energy minister Ed Davey unveiled the government's much-trailed Energy Bill, setting out the roadmap for the UK's switch to "a low-carbon economy".
Energy firms can increase the "green" levy from £3bn to £7.6bn a year by 2020, potentially increasing household bills by £100.
Sunday, 2 December 2012
Nov 2012 Coalition energy bill published: Q&A
http://www.bbc.co.uk/news/business-20458326
Video and report
http://www.bbc.co.uk/news/business-20539981
Video and report
http://www.bbc.co.uk/news/business-20539981
Coalition green policy
http://www.guardian.co.uk/politics/2012/nov/14/windfarms-coalition-environment-byelection
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