Why the Tory plan to axe pensioners fuel benefits is as flawed as Labour’s Ed Balls up

Tory manifesto

Tory Manifesto: An Ed Balls Up on fuel payments for pensioners

 

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This  is the extract from the Tory manifesto relating to plans to axe the £200 a year payment to all pensioners and the £300 a year payment to those over 75 . The plan is stolen from the Labour manifesto of 2015 and was originally proposed by Ed Balls to “save £100m “.

we will target help where it is needed most.So we will look at Winter Fuel Payments, the largest benefit paid to pensioners, in this context. The benefit is paid regardless of need, giving money to wealthier pensioners when working people on lower incomes do not get similar support.

So we will means test Winter Fuel Payments, focusing assistance on the least well-off pensioners, who are most at risk of fuel poverty.

Fine words but very difficult to implement. Why?

Four years ago I investigated how Labour could implement the same policy – and found it unfair and unworkable. This is what I said:

“As a punter and pensioner who pays higher rate tax because my freelance earnings top up my pension I expected to be one of the people targeted by Ed Balls. In fact it will have zilch effect, a load of old Balls if you like.

Let me explain why. The fuel allowance is currently paid to individual pensioners with a cap of £200 per household. So for a start I only receive £100 of  fuel benefit. The other £100 goes to my wife, also a pensioner, who is a standard rate taxpayer. So his planned saving will be halved anyway in my case.

But it is actually worse than that. My wife became a pensioner before me and was entitled to the full household fuel allowance in her own right. So when I was on The Guardian, ( then on just over £80,000 a year) our household was receiving then  a £200 fuel subsidy for a short time. What will happen under the Balls changes is that my wife will get back the full benefit of £200 – so we will still continue to receive exactly the same subsidy.

I suspect I am not alone. I know of many people around me in the shires, where in traditional families of that generation the main earner is the male who will  pay high rates of tax. His spouse who brought up the children, and did part-time work instead, would be a  standard rate taxpayer. These wealthy households will continue to get the subsidy.

Ed Balls

Ed Balls in more serious mode

Now Ed Balls could get round this by imposing a household cap equivalent to the income level set by the higher rate of tax. But if he does this he will run into fresh problems.”

I chased this up with the Inland Revenue.

They confirmed four years ago that they do  not collate figures showing how many households have higher rate and standard rate taxpayers who are currently eligible for winter fuel payments. They do not need to collect the information as taxpayers are assessed individually. So they don’t know the breakdown. The only figures they have are the number of higher rate taxpayers who are pensioners. I doubt anything has changed.

Theresa May

Theresa May:Leader of the Tory party. Pic credit:BBC

So how are the Tories going to do this. They could scrap the present system and go back to the old fashioned 1950s style tax system- where the man had to fill in the form for the household. But that would be deeply regressive, anti feminist and take no account of modern relationships where couples may not even be married or have  a gay partnership.

They could limit payments only to those claiming pensioner credit – removing all other pensioners- but that would hit the JAMS – just about managing pensioners with a huge hole in their income and be deeply unpopular.

Or they could  say every person has to fill in a means test form – which means even if it was done on line – have to employ more staff at a huge cost just when they want to axe more civil servants.

It ain’t going to work and will be deeply unpopular and  be full of anomolies.  In other words Theresa May has just created another Balls-up.

Should £1 bn of unclaimed pensions, shares and insurance policies be used to alleviate austerity?

Rob Wilson

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Just before Christmas the government  that promised a ” bonfire of the quangos”set up a new one.

It is called the Dormant Assets Commission and it is unusual in that every member of the quango is a wealthy business person.

Not surprisingly there was little coverage of this body. But the government itself provided a lot of information about what it would do and who was sitting on it. I have written about it in last week’s Tribune magazine.

It has been given a year to scour the financial markets to find unclaimed stocks and shares, pensions, bonds and insurance policies which have not been claimed for more than 15 years.

The quango, set up by the Cabinet Office, follows on the work of identifying dormant bank accounts which led to £850m being distributed to good causes by the Big Lottery Fund since it was set up by the last Labour government in 2008.

The decision on who will get the new money however will depend on Cabinet Office ministers who are making it clear that it is likely to go to charities which are replacing services provided by local government and the state.

Minister for Civil Society, Rob Wilson said:

“More than a billion pounds of assets, that might otherwise sit gathering dust, will go into funding for charities that make a real difference to people’s lives across the country.

“To build an even more caring and compassionate country we need to transform dormant resources and give the funds to those who need it.”

The commission is entirely staffed by business people – many global players – under the chairmanship of Nick O’Donohoe, chief executive officer of Big Society Capital until the end of last year and a former head of global research for bankers J P Morgan.

The business people aiding him are Richard Collier-Keywood, PwC Global vice-chairman; Kirsty Cooper, group general counsel and company secretary, Aviva plc;Gurpreet Dehal, former chief operating officer Global Prime Services, Credit Suisse;Rachel Hanger, partner, KPMG; Jackie Hunt, non-executive director, CityUK and member of the Financial Conduct Authority Practitioner Panel; Mark Makepeace, group director of information services, London Stock Exchange Group and chief executive of FTSE Group; Susan Sternglass Noble, senior advisor to the Investor Forum; and Martin Turner, group business risk director, Lloyds Banking Group.

Richard Collier-Keywood was the head international tax expert for PriceWaterhouseCoopers advising international companies on global taxation.

Rachel Hanger from KPMG is also another international tax adviser for hedge funds providing what her biography describes as “pro tax advice” to fund managers.

Mark Makepeace is the man who co-ordinated the “big bang” deregulation at the London Stock Exchange and runs his own global index business. He is the only one of the new appointments who declares any interest in charities, having been a long-standing supporter of Unicef.

To my mind the present Conservative government is pursuing a pretty nasty policy of cutting services. But should it make up the shortfall by grabbing other people’s assets and employ wealthy people skilled in tax avoidance to find them.

And how will ministers spend other people’s money. Will  the ” sofa style ” government of Tony Blair be replaced by the ” dinner party ” style of government by David Cameron and George Osborne distributing other people’s assets to their mates favourite charities or services in Tory marginal seats.?I am deeply suspicious of this venture and we are entitled to know more about it.

A worrying indictment of how child sex abuse cases are handled today

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This week the inquiry into historic child sexual abuse under New Zealand judge Lady Justice Goddard will start preliminary hearings which could last years. On Wednesday it starts with a hearing into allegations against the late Lord Janner. The following Wednesday there are two short sessions looking into abuse inside the Anglican Church and at Knowl View and other venues in Rochdale and on Thursday March 24  into child sexual abuse of people in the care of Lambeth Council. The details are here.

Last week a report came out from the United Kingdom  Child Sex Abuse People’s Tribunal- a very small scale investigation that took evidence from 24 people covering different types of sexual abuse with families, institutions and paedophile rings. What comes out – apart from horrific stories from the testimony of individuals – is a system not capable of sensitively handling the issue. As it says in this paragraph:

people's tribunal two

That to my mind  is as important as the recommendations reported on Mail On line by  the Press Association here . These include a permanent commission,provision of advocates to survivors  proper links between mental health and  police investigating abuse  and a safe channel for victims yo give evidence anonymously.plus better training for police, the judiciary and the health service to handle cases.

This report deserves to be taken seriously as its steering committee was composed ,mainly of survivors themselves  aided by professional advisers and two experts, Regina Paulose, an American lawyer and former prosecutor and Alan Collins, a British solicitor with enormous experience in handling child abuse cases from Jersey’s Haut de la Garenne inquiry  to Australia and Kenya.

If the Goddard Inquiry really wants to tackle the issue they could  not do much better than take  this on board  when they start their hearings.

The full report can be found here.

 

 

 

 

 

Spending Review: Caveat Emptor- Buyer Beware

George-Osborne1

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Today the Chancellor, George Osborne, launched the autumn spending review.

From the statement you might guess that he has climbed down over welfare spending cuts by abolishing his plan to cut tax credits, climbed down over big cuts to police budgets and acted to save the mental health budget and save the NHS from further cuts. All terribly good news along with more money for defence equipment, the security services, already announced.

But if you look at the figures he still planning  the same  huge level of cuts  but apparently with no pain.

For a start we are going to have no changes to the tax credits – yet there is going to be a change to the new universal credit which will replace a whole series of benefits. So the government will still be cutting the welfare bill by £12 billion. No details yet but it will be sneaked through when the figures are announced much later, hitting another group. And he is proposing to sell 20 per cent of the Department of work and Pensions estate- selling off  Jobcentres and benefit offices.

The NHS is getting more money but will have to make £22 billion of efficiency savings and provide a 7 day a week service. How? No details.

The police may not get their budget cut but the budget is not protected against inflation which is expected to start rising – so there is a hidden cuts inside this announcement.

And  the government claimed it had protected the science budget – but within hours engineers were announcing that a major demonstration project into carbon capture – which could save some coal fired power stations from closure – had been cancelled.

And both the extra money for defence and spending by HM Revenue and Customs – on equipment and tackling tax evasion- is going to be financed by axing thousands of civilian jobs in defence and closing down almost all local tax offices.

And while there is a £600m fund for mental health inside the NHS many voluntary organisations looking after the mentally ill and handicapped will be hit by the huge cut in local government funding.

There is more privatisation on the way – the rest of air traffic control, ordnance Survey and the Land Registry.

So what looks like a series of good announcements are often little more than smoke and mirrors. And in this budget it will depend more than most on the small print hidden in government announcements. Journalists are often fooled into first believing the initial message only to find it starts to unravel over the next few weeks when the policy bites. This is a Caveat Emptor Spending Review- buyer beware.

 

Labour leadership: Stormin’ Corbyn winning the new battle of Berkhamsted

BERKHAMSTED CASTLE pPc Credit:geograph-org-uk

BERKHAMSTED CASTLE
Pic Credit:geograph-org-uk

Berkhamsted in Hertfordshire is not known as a centre of left wing radicalism. It has had only two revolutionary moments in its 1000 year history . They were the capitulation of the English to William the Conqueror in 1066 at Berkhamsted Castle and the Battle of Berkhamsted Common in 1866.

The latter was a remarkable story, A wealthy MP, Augustus Smith, was furious that a local landowner had enclosed common land above the town. So rather than just protest he took direct action. As a book, The Short History of Berkhamsted reveals he hired ” a miniature army of Cockney” toughs” and Irish labourers and charted a special train to convey them from Euston to Tring at the dead of night.”

These 120 men armed with crowbars tore down the iron railings overnight and the next day a newspaper reported ” “In carriages, gigs, dogcarts and on foot, gentry, shopkeepers, husbandmen, women and children at once tested the reality of what they saw by strolling over and squatting on the Common and taking away morsels of gorse to prove, as they said) the place was their own again.”

An Act of Parliament later guaranteed the freedom of the Common and Lord Brownlow who had tried to enclose it gave up.

Fast forward to 2015 and another extraordinary revolution seems to be taking place in the town if not the country..At a barbecue organised by the Berkhamsted and Tring branch of South West Herts Labour Party, members are talking about voting for Jeremy Corbyn.

Jeremy Corbyn Mp, popular with Berkhamsted Labour members

Jeremy Corbyn Mp, popular with   Berkhamsted Labour members

Now Jeremy has not had to bring in Cockney ” toughies” or Irish labourers to prove his point ( though they are many still in his Islington North constituency) but merely appear at local hustings with either other candidates or their representatives.

Both new members of the party and long-standing members are saying they are fed up with Labour apologising for what it stands for and don’t know what the other candidates for the leadership want to do. One lumped Andy Burnham,Yvette Cooper and Liz Kendall into the same mould. She described them as vanilla – bland and tasteless with no ideological view of society.

They contrasted this with Corbyn who at least knows what he believes, doesn’t apologise for being a member of the Labour Party and would take the fight to the Tories and revamp the organisation. I saw no sign of entryism ( which the Sunday Times suggests) here among the new members – after all Chorleywood was never a bastion of the Militant Tendency even in its heyday. And John Mann MP is ridiculed for wanting to halt the election.

Angela Eagle Benefiting  from Yvette Cooper's pro women campaign.. Pic credit: The Guardian

Angela Eagle Benefiting from Yvette Cooper’s pro women campaign.. Pic credit: The Guardian

This doesn’t mean that the people  who are going to vote for Corbyn agree with every single policy he stands for – but they seem to want something different from the present, in their words, uninspired rivals. The only pause for thought is whether this will split the party – but the history of the SDP suggests otherwise. And Yvette Cooper’s point about Labour being a club for the boys has made some impact  but not in the way she wants..It has caused people to think of voting for Angela Eagle as deputy to  gender balance their vote for Corbyn. I shall still plump for Tom Watson.

I sense rather like in the run up to the general election in Scotland that something big is happening and is becoming unstoppable. Already neighbouring Hemel Hempstead constituency party has decided to endorse Corbyn and it looked like that grassroots Labour members have suddenly decided they are fed up with the status quo and wants something different..

The impact if Corbyn wins will be game changing. Defeated Labour candidates in some areas are taking the opposite view as this article in The Guardian shows. They see that Labour didn’t take into account the views of working class voters hating scroungers and more immigration. I hear this too from the working class carers who assist my disabled wife. But don’t they realise what these voters want is NO immigration ( Britain is full that’s why public services are bad, they tell me) .They want a ban on foreigners holding British jobs and the ABOLITION of benefits for scroungers. Are Will Straw and Jessica Asato going to stand on a Labour platform banning anybody from abroad working in Britain and the abolition of large swathes of welfare to get their vote? I would be surprised – it would make an interesting article in Left Foot Forward.

Would Will Straw really campaign to stop foreigners getting British jobs to get working class votes?

Would Will Straw really campaign to stop foreigners getting British jobs to get working class votes?

No, Labour has to decide where it stands on all this and then campaign and educate people that it is cuts in public services not more immigrants that is causing a lot of the problem. That is why I am still deciding whether I should take the plunge and back Corbyn or stick with either Cooper or Burnham.

Lies, Damned Lies and Tory Jobless Statistics

Misleading statistics for the dole queue.

Misleading statistics for the dole queue.

I see from the excellent Vox Political blog that a row has broken out over claims  by Conservative Central Office of big reductions in the number of jobless claiming benefit under the last coalition government.

The BBC reports a row over the way Essex Tory MPs are presenting falls in unemployment figures. The row concentrates on them using the claimant count. ( Jobseekers Allowance only) rather than the number of people seeking work who are not on benefit. This makes a huge difference to the numbers unemployed in constituencies.

Central Office defended their stance by saying : “This  (questions surrounding the use of JSA figures) is nonsense. This unemployment measure is provided by the independent House of Commons Library – and for constituencies they are the most up to date and most reliable numbers to use.They are used by MPs and candidates across the country, regardless of political party.”

However as readers of this blog will know this is not the true and accurate picture because since Iain Duncan Smith, the work and pensions secretary, introduced universal credit – those transferred from JSA and still on the dole  were no longer counted in the JSA figures. So where there are jobcentres already implementing universal credit in constituencies these figures were  much less.

So it is rather outrageous for Tory Central Office to quote the very House of Commons reports that reveal this as the correct interpretation of the claimant count particularly if they only use JSA..

The very latest statistics available have for the first time started showing both but the situation is a mess as this report  from the Commons library covering unemployment in February 2015 shows. For the first time it does try to show those on Universal Credit and those on JSA who are the dole – adding about 27,900 to the JSA total.

As  the report says : “From April 2013, some unemployed people attending certain jobcentres are claiming Universal Credit rather than JSA. Consequently, simply looking at the number of JSA claimants in the areas affected may not give an accurate reflection of the number of people looking for work. At the national level, the effect of Universal Credit on the total claimant count remains minor.”

But given the distortion between those on the dole in the prosperous South and less prosperous North these figures are still significant. In the North West of England it accounts for another 25,000 on the dole. In London it is just 400.

To make matters worse trying to breakdown accurate figures for the long-term employed and by age group is impossible at the moment. The figures are just not available.

As the report says: “Data on the number of Universal Credit claimants who are out-of-work by age are currently not published at the constituency level. However, data are available on JSA claimants by age.
In constituencies where Universal Credit has been introduced, the number of JSA claimants may not reflect the actual number of unemployed claimants in a particular age group.”

It adds: “Similarly, data on the number of Universal Credit claimants who are out-of-work by duration of claim are currently not published at the constituency level.”

So beware of false claims and people quoting official House of Commons documents to back them up. They are not necessarily giving the full picture.

A4e: Six jailed in £300,000 fake job fraud scam

A4e: Improving People's lives -and defrauding the government

A4e: Improving People’s lives -and defrauding the government

The scandal that rocked A4e, the private contractor condemned by the Commons Public Accounts Committee, for fiddling the books, hit home this week.

Six people were given jail sentences and another four were given suspended sentences by a judge at  Reading Crown Court.

The BBC reported here yesterday the sentencing by the judge. The scheme as reported earlier on this blog involved mentoring single parents – some of the most vulnerable in society so they could get work. But the £1.3m Aspire programme turned out to be a vehicle for fraud by the staff.

The court was told  staff made up files, forged signatures and falsely claimed they had helped people find jobs, enabling them to hit targets and gain government bonuses.

Judge Angela Morris said there had been a “systematic practice” of compiling bogus files over a “considerable period of time”, behaviour which she described as “appallingly cavalier”.

She said: “No amount of pressure justifies the wholesale fabrication of information in files or the forgery of other people’s signatures on documents, all of which is designed to extract money from the Department of Work and Pensions.”

The roll call of fraudsters are:

  • Charles McDonald, 44, of Derwent Road, Egham, Surrey, pleaded guilty to six counts of forgery and one of conspiracy to commit forgery. He was sentenced to 40 months in prison.
  • Julie Grimes, 52, of Monks Way, Staines, Surrey, pleaded guilty to nine counts of forgery. She was sentenced to 26 months in prison.
  • Nikki Foster, 31, of High Tree Drive, Reading, pleaded guilty to nine counts of forgery, and was jailed for 22 months.
  • Ines Cano-Uribe, 39, of Madrid, Spain, was found guilty of one count of forgery and one of conspiracy to commit forgery. She was jailed for 18 months.
  • Dean Lloyd, 38, of Rochfords, Coffee Hall, Milton Keynes, pleaded guilty to 13 counts of forgery. He was given a 15-month jail sentence.
  • Bindiya Dholiwar, 29, of Reddington Drive, Slough, pleaded guilty to seven counts of forgery, and was jailed for 15 months.
  • Zabar Khalil, 35, of Dolphin Road, Slough, was found guilty of one count of forgery. He was given a 12-month sentence, suspended for two years.
  • Matthew Hannigan-Train, 31, of Westacre Close, Bristol, was found guilty of one count of conspiracy to commit forgery. He received a 12-month sentence, suspended for two years.
  • Hayley Wilson, 27, of Middlesex Drive, Milton Keynes, was found guilty of one count of conspiracy to commit forgery. She was given a 12-month sentence, suspended for two years.
  • Aditi Singh, 32, of Albert Street, Slough, pleaded guilty to two counts of forgery and one count of possessing items to commit fraud, and received a 10-month sentence, suspended for two years.

However less we forget the Department for Work and Pensions was severely criticised in a Commons public accounts committee report for failing to conduct checks on what was going on with A4e at the time – and the company was only investigated because whistleblowers came forward about what was going on.

Chris Grayling, then the minister responsible for employment, took no action to investigate further either. As the PAC said at the time in a report  on A4e and other programmes the DWP never looked at whether A4e was ” a fit and proper contractor” to run other programmes.

A4e chief executive Andrew Dutton said  yesterday the company has a “zero-tolerance policy” towards fraud and money had been set aside so “the taxpayer will have lost nothing” from the scam.

Mr Dutton said: “Their claims do not reflect the way this company operates, or the values of our 2,100 staff, whose honesty and integrity are much-valued.”

I remain to be convinced whether the company has truly reformed.