This article was written by Tom Clark, for The Guardian on Tuesday 4th November 2014
The occupational pensions of MPs, ministers and the prime minister could be classified as welfare spending in the tax transparency statements that George Osborne has promised every taxpayer.
Her Majesty’s Revenue and Customs is writing to millions of tax-paying households with detailed figures on how the government spends their income tax and National Insurance contributions. Welfare is recorded collectively as the single largest expenditure, consuming nearly one pound in every four.
This presentation has been criticised as a politically motivated departure from Treasury officials’ original plan to break down social security into the components paid to different parts of the population, such as elderly, disabled and unemployed people.
By revealing that payments specifically earmarked for the unemployed, for example, represented only 3% of the total, this approach may have set back Osborne’s case for a fresh £12bn in benefit cuts.
Now experts are drawing attention not only to the lack of differentiation in the welfare chunk of spending but also to the inclusion of substantial elements of spending that would not normally be considered welfare at all, notably personal social services and public sector pensions. Even ministerial pensions are likely to be covered.
The Treasury said: “The headings in our tax summaries are based on internationally recognised (UN) definitions.” But in a briefing note published on Tuesday, the Institute for Fiscal Studies detailed how the welfare total included £28.5bn on “personal social services”.
“This is a number that in many analyses one would want to report separately from other welfare spending,” the IFS said. “Unlike other elements of ‘social protection’ it is not a cash transfer payment and in many ways has more in common with spending on health than spending on social security benefits.
“Another £20bn of the spending counted under welfare is pensions to older people other than state pensions. That includes spending on public sector pensions – to retired nurses, soldiers and so on. This is not spending that would normally be classed as welfare.”
Declan Gaffney, a social security researcher, said the inclusion of public sector pensions was bizarre.
“The Treasury needs to clarify exactly how it arrived at these figures, and publish the workings – spelling out exactly whose pensions it included. Does it, for example, include MPs and the prime minister himself?”
Gaffney has used IFS tables to calculate a more conventional figure for total welfare less state pension expenditure, and concludes that the government’s choice of definition inflates the published welfare spending total by around 40%.
The Treasury did not respond to a question about whether the pensions of MPs, ministers and the prime minister would be classified as welfare.
A spokesman for PCS, the civil service union, said:
“Tens of thousands of civil servants work hard to deliver social security support and they know how important and necessary it is. For their pensions to be hijacked as part of the government’s latest political attack on our welfare state is absolutely disgusting and it exposes just how far ministers will go to poison the well of public opinion.”
Source – Welfare Weekly, 04 Nov 2014
Labour’s Northern heartland is being urged to fight any plan for a 2015 coalition with the Liberal Democrats in 2015.
Wansbeck MP Ian Lavery has hit out at suggestions that Labour could work with the Lib Dems if there is no overall control after the next General Election.
Polls have suggested Labour could take the largest number of seats but not have enough for an overall majority, rasing the prospect of teaming up with the Conservative’s coalition partners.
Mr Lavery, chair of the trade union group of MPs, said the thought of Lib Dems seeking a possible deal with Labour after working with the Tories “is enough to make my blood boil.”
In an article on the future Government, the MP said that Lib Dems suggesting that there should be a coalition with Labour needed to realise that “in areas like mine, that position simply wouldn’t be stomached, either by voters or activists. In the event of a hung parliament with Labour the largest party, we simply have to go it alone.”
He later told The Journal that Lib Dem voters should “consider where their loyalties lie” adding that he would welcome them into the Labour party “with open arms”.
Writing for the Labour List website, Mr Lavery added: “The green benches in the Commons are increasingly populated by the elite and the political careerists. A minority of MPs have a working class background. We are in danger of no longer reflecting the people we represent.”
> Way too late, mate. The majority of the Labour party are part of the elite and the political careerists. Maybe you ought to be leaving them, and setting up your own party ?
Mr Lavery’s Lib Dem attack came after Unite’s Len McCluskey said any new coalition would only keep the country “bogged down in the same failed consensus”.
Last night senior North East peer Lord Shipley accused Mr Lavery of failing to recognise the will of the voters.
Lord Shipley, a former Newcastle council leader, advises the Government on city issues and helps decide where to spends its multi-billion pound regional growth fund.
> And since the North East has been on the end of cut after cut, I think we can make a guess at just what kind of advice he gives the government…
He said: “Ian Lavery should remember that the voters will decide who forms the next Government. If no party wins a majority of seats it means the electorate does not wish any of them to govern alone. If Labour tries to form a minority government in spite of the voters’ wishes, they won’t last long.”
> No, it’s the old lie : voters will decide who forms the next Government. All voters get to do is choose their constituency MP. No-one voted for the current ConDem government.
Mr Lavery, an MP who has previously spoken out in criticism of the party, stepped down as an parliamentary aide to Harriet Harman in 2012 after refusing to abstain on a vote to cut public sector pensions.
In his piece Mr lavery again raised party concerns, saying Labour is not doing enough to fight for workers’ rights.
“Sadly we’ve long since stopped talking about repealing anti trade union laws, but a consequence of neutering trade unions we have seen real wages falling for most people in work. For 45 consecutive months wages have declined in value,” Mr Lavery said.
> The trouble is, there is no indication that, should they become the government after the next election, Labour will do anything to reverse the ConDem excesses – quite the opposite.
People like Mr Lavery will have to decide which side of the line they want to be.
Source – Newcastle Journal, 28 Feb 2014