David Cameron's green tax gamble

The Conservative Party has its best chance in a generation to form the next Government.  Morning after morning we wake up to new stories about a divided and incompetent Labour Party.  Tony Blair's pre-announcement of his resignation has to go down as one of political history's worst ever decisions.  Fraser Nelson, writing in this week's Spectator, thinks that the Labour coalition could unravel as the anti-war LibDems continue their leftwards lurch:

"The staged defections of 30-odd (mainly Muslim) Labour party members to the Lib Dems last week in Margaret Beckett’s constituency warns of a trend which could pave the way to Tory government. The Lib Dems could unravel the New Labour coalition from the Left while the Cameron Conservatives tug from the centre-Right — sending Mr Brown spinning into oblivion..."

We can only hope that Fraser is right.

A leading threat to Tory chances is the David Cameron's environmental agenda.  Today the Conservative leader will join the LibDems and Friends of the Earth in calling for legislation that will require annual cuts of 3% in the UK economy's greenhouse gas emmissions.  Without significant economic diversification or technological advance that could be economically very damaging.  The Tories are determined to use green taxes - including the possible reintroduction of the fuel duty escalator - to achieve their environmental goals.

No other conservative leader in the Anglosphere has taken the same path.  Bush, Harper and Howard are focusing on the terror threat and the need to keep their economies competitive against the developing nations that are shunning Kyoto-style environmental controls.

Will climate change be the number one international issue for voters at the next election or will the terror threat dominate debate?  Will voters be willing to pay more to take their kids to Spain for their summer holiday?  Will the fuel protestors of 2000 accept big increases in fuel duty now?  Will any environmental progress in Britain be futile?  It is in China and India where greenhouse gas emmissions are rising fast.

David Cameron has considerable political skills and he will need all of them to sell his blue-green revolution to the British people.  There should be no doubt, however, that his green agenda is the biggest gamble of his leadership.

Comments

[MH]

The Daily Telegraph had it about right. All opinion polls now show that the electorate feels grossly taxed across the board. Some of the most provocative and deeply unpopular taxes pertain to fuel and transport. So Dave suggests we put them up and - at one stroke - hit rural areas and the less affluent at a stroke. Way to go to royally piss people off. Since when was it a good sign that the only encouraging editorials the Conservative Party gets are in the Guardian?

[Lord Haw Haw]

What total rubbish. Dave is the only reason we have a chance of winning. I know you lot all hate it but I am afraid its true!

[Jonathan Mackie]

I have real reservations about environmental taxes.

As I noted in a seperate posting, taxing consumption is highly regressive, falling disproportionately on those on low and fixed incomes. We should be very very cautious about a tax policy which makes the rich richer and the poor poorer. Worst of all worlds.

As for the ubiquitious friends of the earth. Why we in such hock to that agenda driven, peremptory organisation is beyond me.

[MH]

I remember what a service Lord Haw Haw did to this country and what we did to him subsequently. Please do not refer to 'we' winning in my case. I left the Conservatives 3 months ago after 20 years of membership and have become an Independent councillor. I have no intention of voting Conservative while the present Blair clones are in charge.

[Phil Taylor]

More green taxes could be made to work if higher fuel charges were offset by much higher tax allowances that took many of the poor out of the tax/NI system altogether. Incentivise work, disincentivise one of the main sources of carbon. The only people who would lose out would be the very rich who didn't work, lived off capital and drove a lot. Not sure that this group would garner much sympathy.

[Og]

Lord Haw Haw, you are plain wrong. Remember that at the last election, the un-Daved party polled more votes in England than Labour. That gives it a "chance" at the next election, regardless of whether Davis or Cameron had won the leadership.

Even IDS might have had a small poll lead by now, given the own goals Labour scores each month.

By all means let us take the (ever-changing) climate seriously, but raising transportation costs even more, hammering rural dwellers, is immoral and unconservative.

[tapestry]

The Guardian is exactly where we need encouraging editorials, MH.

Not many Telegraph readers will vote Labour. One or two might try fruitcake but not many.

Labour's vote is being hit on three sides. By Lib Dems about the war. By Conservatives with Blair-replacing Cameron persona and image. Don't forget the BNP though. They are active in many Constituencies come rain or shine handing out leaflets door to door building up core support. They too can take many Labour votes. Polls indicate a growing share by 'Others'.

If Gordon Brown becomes leader, he won't be able to hide any longer on issues such as the war in Iraq. Full exposure of Brown is more likely to lose Labour support than to build it, in most peoples' opinions. Blair seems determined to hang on until there is an alternative to Brown anyway.

At least politics is getting interesting again.

[malcolm]

I would agree with you Phil Taylor if Cameron is able to reduce the overall tax take and raise allowance etc the transfer toward green taxes may prove to be electorally popular if sold well.
Also agree with Tapestry, hopefully Blair will fight to keep his job and there will be much blood on the carpet within the Labour party, a nice Labour civil war would be good.

[Jonathan Mackie]

Tapestry - You assume Brown is the next Labour leader. I agree he is favourite, but I suspect John Reid will have a say.

If you watched Newsnight last night it was all very positive about Reid building him up for a leadership challenge.

The longer Blair stays, Brown's chances recede. They are umbilically linked and that generation is moving on.

On the environmental thing, I just don't buy it as the big vote winner. If you look at Mori's polls regarding voting determinants, the environment is no-where. Crime, education, health, defence, race and immigration are much more influencial factors.

As an issue it may allow us to soften our (apparently) hard image, but it just won't be a factor when people come to place their cross. People are sceptical about the green lobby, and they are selfish about their lifestyle. We need to acknowledge that and stop the constant emphasis on green issues.

[Jonathan Mackie]

Malcolm - Tax allowance should be at least £10k. Lifting low earners out of tax altogether. It should be done without being replaced by anything.

Moving taxation to consumption as green taxes would do is regressive. It would price low earners out of the mainstream. If it is such a good idea, lets propose raising VAT and cutting income tax. See how that works.

[Gildas]

More green taxes could be made to work if higher fuel charges were offset by much higher tax allowances that took many of the poor out of the tax/NI system altogether

This might well be the case but all we've seen so far is a plan to reduce Stamp Duty on share dealings! Thus the bold Tory policy is to stick up taxes on the poor hardworking motorist, and anyone who fancies a cheap holiday, in order to subsidise our chums in the City!

[I know cutting Stamp Duty makes economic sense but please. We keep hearing from the Cameron-groupies that us Neanderthals on the right have no sense of how we appear to the electorate. Pot. Kettle. Black.]

I'm a broken-glass conservative. Cameron would have to work really hard to drive my vote away because we have to get rid of this awful government, but the more I see of this sort of thing the more I think Labour might just scrape back in.

[Renny]

Green taxes will be a winner if we use carrot and stick approach. Stick to stop socially unacceptable forms of consumption such as urban 4x4s combined with carrot to make socially acceptable forms more appealing such as tax brakes for low emission vehicles or public transport.

Taxation that aims to achieve (over the medium/longer term) a carbon free economy is what is going to get me into a polling booth again.

[George Hinton]

Bugger climate change and green or eco taxes.
My sole interst is how much is in my pocket after the rape and pillage by the taxman.
All this climate change lark is overdone by a bunch of loonies.

[Michael McGowan]

I thought that one reason support for the Tories plummeted in the early nineties was that they proposed a highly regressive tax, the poll tax, to fund council services. Now they seem to be proposing more highly regressive taxes to be paid for the privilege of going to work or driving your children to school or going to the supermarket. No carrot. All stick. I know John Stuart Mill called the Tory Party the stupid party but this is ridiculous. I am sure Labour's spinmeisters are reading and taking note. Who can blame them?

[Daniel Vince-Archer]

"No other conservative leader in the Anglosphere has taken the same path. Bush, Harper and Howard are focusing on the terror threat and the need to keep their economies competitive against the developing nations that are shunning Kyoto-style environmental controls."

*cough* Schwarzenegger *cough*

[Steve]

I agree with Jonathan Mackie above.

Environmentally related issues are a great way to soften our 'harsh' image and of course, we can even be committed to some such policies.

But we do risk alienating potential voters if we harp on it too much. As an example, the 'vote blue go green' local election theme was laughable up here (the north west). I don't know how it played in other areas of the country but other than the usual suspects, I doubt it influenced many votes in this region.

Excellent mood music it is but don't let us obsess on it.

[David Robbins]

"Tax allowance should be at least £10k. Lifting low earners out of tax altogether. It should be done without being replaced by anything."

1.) How would you pay for it, then?
2.) That wouldn't lift low earners out of tax altogether. It would lift them out of income tax altogether. And you don't pay much income tax if you haven't got much income. Your proposal would benefit someone earning £8k to the tune of £394 a year. It would benefit someone earning £80k to the tune of £1,092 a year (or £834 if you abolished the 10p band at the same time).

[Jonathan Mackie]

David - The tax take from earnings below £10k is actually lower than the tax credits dispensed. Abolish the credits and lift people out of tax altogether. Simplifies the tax system, is morally correct and incentivises people throughout the income scales.

Your second point, is of course semantically correct. I should have said tax on income altogether.

All in all though a much better approach than shifting tax to consumption, which is regressive, which ever way you stack it up.

[EML]

We'll have to see how the hard policy spans out with regards to 'green' taxation. I don't see it as taxing motorists per se, as the Telegraph article appears to suggest, but increasing taxation in proportion to the social/environmental damage that individuals inflict.

What's wrong with a sliding scale, with big cars getting taxed more than your average 1.4-litre runabout, with perhaps zero tax on the smallest/cleanest engines?

No overall increase or decrease in taxation, at least in the short term.

Of course education, healthcare, the economy, and security are more important (I don't share the doom-mongering thoughts of some about the fate of our planet, or the extent to which we can do anything about it), but, as had been said, whilst policies are being formulated for the above, this is a good topic to be side-tracked by.

As a natural conservative, I don't see why more resources should be used than is necessary for the task in hand. Gentle taxation is one of the better ways of concentrating the minds of people.

[Derek]

If David Cameron really wants to put the environment at the top of his agenda and he believes it is a vote winner then this sort of policy is what he should do. The problem is that even this will not be nearly enough to make a significant difference in our carbon emissions, as most people have to use their cars and have no choice but to pay the higher taxes. He might reduce air travel if he puts a big tax on it, but that will adversely affect the economy.

Surely eventually the penny will drop that whatever we do in this country will have no significant effect whatever on the global carbon emissions, as our total output is less than 2% of that of the world, and China and India are increasing their output by more than this every year, and show no likelyhood of stopping.

I fear he believes too much in image and not enough in substance.

[EML]

Also, on the general topic of the form taxation can take: I have nothing wrong with taxation being directed more at consumption rather than income. What does it matter how much someone earns? What is important is what they do with it.

VAT, for example, was supposed to be a tax on luxury, as far as I recall. It is slightly regressive, perhaps, but the more someone earns, the more they spend on 'luxuries'. It depends, of course, on what goods qualify for VAT.

[David Robbins]

Jonathan - If only it were that simple. Anyone who doesn't get tax credits but does pay income tax would be better off under your proposal. So if you want this to be cost-neutral, those who do get tax credits must on average be worse off.

For examples of who would lose out, see the Treasury document published alongside the 2005 Budget, e.g.,: "Tax credits mean that a family with two children and a full-time earner on £15,500 a year, around half male mean earnings, is receiving a net tax payment of £2,200 a year. If tax credits were abolished, and the money used
to increase the personal allowance, this family would instead find itself making a net tax payment to the Exchequer of around £900 a year."

[Ted]

Jonathon Mackie 10:21

The Blessed Margaret went to the country in 1979 with proposal to shift taxes from income to expenditure - which was done by raising VAT rates. John Major won an election after cutting Community Charge by raising VAT rates. Both regressive measures as against income tax but arged on basis that taxing expenditure left voters opportunity as individuals to save by cutting spending.

If (as Libs have done) you say changes will be fiscally neutral but will move balance from all to the mst polluting then it isn't necessarily a vote loser. This doesn't work with things like fuel escaltor as we all pay but new car tax, tax on aircraft by flight rather than passenger (so driving towards better loading) are more sellable.

While I think they need consideration IMHO I don't like them because the rewards for god behaviour are not significant enough, those who are dependent on private transport suffer more than those in cities with good public transport gain.

I'd prefer to see vehicle emmission standards hardened to dirve technolgical innovation - similarly with home / domestic energy use, power generation etc. The state can lay down that by x date no new vehicle can emit more than x ppm of y, it can say that all vehicles must be able to run on a 80/20 mix with biofuel. I drove past Drax power station yesterday and wondered what cost would redeveloping it as a clean coal station - rather than tax rest of us for using power what can be done to reward change by Drax to clean coal.

[Simon Chapman]

Iain Dale's piece on the fuel escalator on his blog is spot on. It would be disastrous to reintroduce it, particularly in the current fuel price climate. It is a regressive tax on mobility, which will hit rural people, families, small tradesmen & small businesses in particular. It is about as striver-unfriendly a policy as possible.

I agree that the party needed to reposition itself to take the environment more seriously than it used to. But there is a real danger that we are buying into left wing solutions without doing any rigorous new & conservative thinking on this.

Norris may be being used as an outrider - but this would make us look out of date, out of touch & out of mind. I hope that this suggestion is stamped on firmly and quickly.

[Michael McGowan]

Good points, Ted. However, on regressive taxes, do bear in mind that in 1979, we were starting from a much lower baseline in terms of the VAT rate and that stamp duty (another extremely regressive tax) was at much lower rates than it is now thanks to Gordon Brown. Also add to that (i) other new regressive taxes such as insurance premium tax which did not exist in 1990 and was created by Kenneth Clarke; (ii) rocketing levels of council tax; and (iii) so-called "user charges" e.g. tuition fees. In short, the scale of regressive taxation and equivalents in this country has expanded beyond recognition since the late 1970's.

[Oberon Houston]

Look, there is a lot of over-reaction to this. The ‘environment agenda’ is one which gets guaranteed headlines where we need it most, and works to underline the nice caring forward looking form of the party to floating voters. Yes, vehicle road tax scales may widen a bit, bicycle schemes get encouraged, loft insulation exempt from VAT etc.., but this is just policy lolly-pops, because yes everyone is aware of the folly of aggressive green taxation, we are not fools. However we should avoid treating our leadership team as a bunch of naive idiots, because they are far from it, indeed they are not policy wonks, but very astute politicians who need to drag our party out of the wilderness and get us elected. To do this they need to start to imbibe a more positive and up to date feeling in many floating voters without actually doing anything too radical. I keep saying this; we need to understand that what Cameron is leading here is an extremely subtle but clever project, where we end up with a conservative government - with conservative policies. Taxes will not be high under a Tory government, get real. Real reform of public services will occur, not Gordon Browns communist control schemes, and much more importantly , we will have traditional Tory values leading the country in every corner of policy, not chip on shoulder disenfranchised Labour MPs. Cameron and his team will deliver us this, so why not get off his back and behind him.

[daniel]

In terms of the environment, Cameron is focussing on the wrong subject, electorally, just as Brown's chickens are coming home to roost.

Additionally, all this talk of regressive taxation - no such thing. Rather the fuel escalator and higher VAT allow for counter cyclical inflationary policy - you put the tax up with cheap oil, and cut it when it get's high. Simple. It's the same with VAT.

We need to move the debate away from Labour language - what's "progressive" about me being punished for earning more for example.

In terms of the environment, I cannot understand why the 'conserve' bit in Conservative cannot be trumped without yet more government intervention. The lack of clear cohesive conservative thinking will only reward Labour, or the Liberal Democrats.

[Jonathan M Scott]

Cameron and Osborne have taken the moral high ground on the environment, and recognise that we need to reduce our emissions etc if we want future generations to have a habitable planet to live in ...

if that is not electorally attractive I don't know what is.

Applying the *polluter pays principle* has got to be seen as good for Britain. As a result, other taxes can fall.

[Gildas]

Applying the *polluter pays principle* has got to be seen as good for Britain. As a result, other taxes can fall.

But its not 'polluter pays'. Its 'polluter shuts his factory and moves to China leaving a whole bunch of people out of work'.

[Tom Greeves]

Having precisely no talent for science, I am an agnostic on all this.

It would be interesting to hear more from those climatology experts who claim we have nothing to fear re global warming. They do exist, though you'd never know it from watching a BBC slot.

[Jonathan Mackie]

Ted - In 1979 the marginal rates of tax on income were so high as to encourage avoidance. Hence tax to income ratio was highest on those who earned less. Thatcher wanted to incentivise work and raise productivity. That was the basis for the alteration in where tax was levied.

As for the poll tax issue, the 2.5% increase in VAT was meant as short term measure I recall. What we got was a highly regressive tax which VAT is.

David your analysis assumes there is no administration charges in the tax credit system. You also accept everything the Treasury issues. Tax credits are a disincentive and an expensive way to relieve the burden on low earners. Lifting the tax threshold to £10k would be a much better more equitable policy

[Tom Greeves]

I for one would not wish to engage any of these dudes in scientific debate:

http://www.friendsofscience.org

Nor these dudes:

http://www.canadafreepress.com/2006/harris061206.htm

I don't really understand any of this. But one thing's for sure - the status of these sceptics demands that they have a proper platform to air their concerns.

[Gildas]

Cameron and his team will deliver us this, so why not get off his back and behind him.

Because if he really is thinking about something so unbelievably stupid as re-introducing the fuel-escalator, it is pretty unlikely that we'll win the next election.

The fact is that fuel tax should be cut, and more roads built.

[Ben Redsell]

Gildas do you want a fourth term Labour Government?

[Al]

I think the jury has come out way too early in the case of India & China as both have immense growth potential and if you look at what China are doing in Dongtan I think perhaps China and possibly India might trump the West by moving away from Oil etc in the current growth spurt they are going through.

The result of such a massive shift would be as big as it gets in terms of hegemony.

Which is why Arnie et al are doing what they are doing. There is green in that there, er, green...

Personally as a non-Tory voter Dave is the first Tory leader making me think twice. Just as the Left had to accept Tone, so shall the Right have to accept Dave. For good and for bad.

Namaste

Al

[Al]

With regard to taxation I think the best answer is to lower taxation and create financial incentive for positive green behaviour instead of taxing existing normal ungreen behaviour.

Except in the case of air travel fuel which should not be subsidised in any way, let the Free Market do it's thing.

Namaste

Al

[Gildas]

Gildas do you want a fourth term Labour Government?

Did you even read what I wrote above?

Lets see:

"I'm a broken-glass conservative. Cameron would have to work really hard to drive my vote away because we have to get rid of this awful government, but the more I see of this sort of thing the more I think Labour might just scrape back in."

"Because if he really is thinking about something so unbelievably stupid as re-introducing the fuel-escalator, it is pretty unlikely that we'll win the next election."

Yup, sounds like I'm cheering Labour on to a fourth term!

My point was very simple - putting up fuel duty, which is already far too high might win some plaudits from Swampy, but it would hurt the very people we need to win over.

In fact, its hard to think of a tax that could be more targetted at hurting the 'striving classes' than putting the cost of petrol up. Perhaps a tax on cheap holidays. Oh, wait, we're proposing that too.

Incidentally, until this year, we lived the reality of relying on public transport, in a town with excellent buses I might add. Never again. You can have the car keys when you prise them out of my Cold Dead Hands.

[Al]

I agree with Gildas that putting up taxes on fuel and holidays will do nothing to win votes for the Tories as that will affect those with less more than those with more...but more importantly of course, and I know you are actually all much more concerned with safeguarding the future than you are concerned with votes ;) higher taxes would make peoiple resent green issues more than embrace them...

Namaste

Al

[Jon Gale]

If increased fuel tax is offset by lower income tax or similar broad taxes then there is no problem, in fact it could be a good idea. If it is offset only by abolishing stamp duty on shares then, yes, there would be a big problem.

But we dont have any information on what the policy would be. We dont know how much green taxes will rise or what other taxes will fall. There was no mention of a fuel escalator.

Similarly this 3% drop in carbon emissions year-on-year Cameron is asking for would depend on how it is achieved (Osborne mentioned in his speech yesterday that Japanese companies have massively reduced their carbon emissions in the last few years) but in reality this proposal wont get passed anyway.

Talking about the environment may not be a major issue for voters but it is a caring-about-the-wider-world subject that helps dispel the "nasty party" image.

[Ben Redsell]

Given that you don't want a fourth term Labour Government Gildas, you must be impressed that DC has given us a nine point lead in the polls, consistently increasing over time. You must also be impressed with the way in which the Conservatives have dominated the news for the last 10 months, nearly always with good news stories.

All this gives an impression of a successful party on the road to recovering it's natural status as the party of Government, after many years asleep.

Since we are now ahead in the polls, with people seriously and credibly talking about the possibility of David Cameron as Prime Minister in a Conservative Government, why are there so many people prepared to come on here detracting from that?

I want to win. I know that Conservative governments are better at delivering the public service reform necessary to make this country strong again. I know that a Conservative government will help save the planet. I know that a Conservative government is much more likely to be concerned with the poor and vulnerable in our society, rather than despising the working classes like this Labour government does.

Because I know all these things I am working towards a Conservative government. So I come back to my central question which is why so many posters on this site seem to want to lose?

[Yet Another Anon]

On the environmental thing, I just don't buy it as the big vote winner. If you look at Mori's polls regarding voting determinants, the environment is no-where. Crime, education, health, defence, race and immigration are much more influencial factors.
Environmental disasters though when they happen if nothing has been attempted to avoid them will lead to the public asking why steps weren't taken to avert it, London, Liverpool, Manchester and many other places could have parts actually underwater due to sea level rises due to melting ice caps and thermal expansion.

Tony Blair's pre-announcement of his resignation has to go down as one of political history's worst ever decisions.
It was badly done, firstly he hadn't intended to announce his retirement but had answered a question put about it, to do this without saying when he was going as Labour leader and when he was going as PM was a bad idea, in fact he said at the end of the term which made it sound like he would remain PM for the full term and his last act would be to ask the Queen for a dissolution and hand in his resignation which always seemed implausible.

He's crazy not saying when he is standing down as PM and as Labour leader, I still think he will stand down as Labour leader after the 2008 Local Elections and as PM at the turn of 2009, it is strange he doesn't just say, he's said since that he is going with time for a new Labour leader to have some time before the next General Election which would mean him standing down before the 2009 Party Conference at the latest, the fact that the date of his going is getting closer works in his favour in that there will be no desire by anyone to launch a challenge to his leadership and maybe be remembered as the person who ended the Labour Government, not a good way of furthering their career, saying when he is going as leader and PM would leave him freer to get on with his job, he hasn't shown any sign of going back on what he said unlike Mrs Thatcher who started talking about a successor to her before deciding that no one around her in the government was up to it and then it was that she was going to be in power for 10 years, and then she started talking about 20 years and this lead ambitious people in the parliamentary party to make moves against her.

[David Robbins]

"David your analysis assumes there is no administration charges in the tax credit system. You also accept everything the Treasury issues."

Around 6 million families receive tax credits. Around 29 million individuals pay income tax and would therefore gain from a higher personal allowance. (The number of households will be smaller, but still much more than 6 million).

You are therefore proposing to take the money currently spent on tax credits and to spread it much more thinly. By definition, that has to mean that the present beneficiaries would lose significant sums. If that is what you are arguing for, be upfront about it.

You are right that tax credits are expensive to administer. In 2004/05, the administrative cost was about 3p per pound paid out (about three times the cost of administering child benefit, according to the IFS). You could multiply that a few times to account for money lost through overpayment.

Though significant, such savings would be nowhere near enough to compensate present recipients for the losses they would suffer. And even if they were, how do you propose to target the payments on them without reintrodcuing the administrative complexity you want to get rid of?

[Michael McGowan]

I think you have answered your own question, Ben. Read your own fourth paragraph. How do you "know" that Conservative Government will do any of those things? I used to believe they would. I don't any more because I looked at the track record of post-war Conservative Governments which have done every bit as much damage to this country (and especially to its education system) as the Labour Party. The Tories have only themselves to blame if people who would ordinarily give them a hearing are no longer prepared to buy the message: get us into power and then trust us to do the right thing.

[Esbonio]

I cannot agree "the Conservatives have dominated the news for the last 10 months, nearly always with good news stories." For me it has been a period of policy light seguing into policy bonkers. The news stories that sick in my mind are chocolate oranges, a windmill on his house, a chauffeur following him in a car whilsthe cycled to work and of course the speech which rapidly became reducued to hugging a hoodie.

[Gildas]

Given that you don't want a fourth term Labour Government Gildas, you must be impressed that DC has given us a nine point lead in the polls, consistently increasing over time. You must also be impressed with the way in which the Conservatives have dominated the news for the last 10 months, nearly always with good news stories.

...

Since we are now ahead in the polls, with people seriously and credibly talking about the possibility of David Cameron as Prime Minister in a Conservative Government, why are there so many people prepared to come on here detracting from that?

...

Because I know all these things I am working towards a Conservative government. So I come back to my central question which is why so many posters on this site seem to want to lose?

We're obviously talking at cross purposes here. Or else you are using me as a stand in for people who don't share take my position, in which case kindly don't.

I thought I'd been perfectly clear, but in the interests of further clarity, I'll simplify:

1. I want Labour out.
2. I welcome Cameron's success so far.
3. I hope it continues.
4. Promising to increase fuel duty strikes me as a damned good way of ensuring it doesn't.

I'm not detracting from the possibility of DC as PM. I'm warning against our making terrible mistake that will alienate our core and target voters.

Or do you really believe that ordinary people are crying out for petrol to cost more?

[anon]

Esbonio has a valid point. If you ask most people what DC's achievements have been so far they will say "hug a hoddie" and then possibly the environment. Whilst we have a 9 point lead this is primarily due to a dis-satisfaction with Tony Blair than anything else. The general public generally have a tendency to stick with what they know (after all the British are by nature naturally conservative) and at the moment we are not (for what I understand are tactical reasons) offering much of an alternative. Whilst the sound-bites and mood music are re-positioning us in the eyes of the public we also have to ask where they are re-positioning us to. To re-iterate esbonio's point we are presently the green chocolate orange hating hoodie huggers. The next question is whether you believe that this is a credible position for us to be in?

[Tory Toff]

Cameron's got it spot on, old boy. I can't wait to jet away to the sun without all those nasty little oiks crowding the aeroplane. And if he follows through on this policy I'll also be able to enjoy taking the Roller out again, once all those council-house types and Essex-men (ughh - I shiver at the thought of them) have been priced off the roads. The modern compassionate Conservative party doesn't need people like these, and without them the whole tone of the party will have been improved 'at a stroke'.

He'll certainly get my vote, although my man-servant may not be so keen

[Julian Morrison]

Green tax is a "sin tax". If it succeeds, you get no money. If you rely on the money, you find yourself willing it not to succeed. Compare tobacco taxes.

[Simon Chapman]

[email protected] "this is just policy lolly-pops, because yes everyone is aware of the folly of aggressive green taxation, we are not fools."

If only...

Steve Norris yesterday: "You will pay more in green taxes. You will, for example, see the reintroduction of a fuel duty escalator I'm quite sure."

Oberon, that's no lollipop. That's Steve Norris sounding rather excited about the prospect of aggressive green taxation. And as posted already, strivers will suffer.

Steve Norris again: "We've now got a generation living in France, working three days a week here, [which] thinks nothing of going to Prague for a stag night."

I asked yesterday on another thread whether people think that this is a good thing, or a bad thing. Nobody answered (he says plaintively). But it seems to me that the answer cuts to the heart of what the party's environmental, energy, transport & related tax policies should be about. Do we welcome it, or do we want to put a stop to it?

Steve Norris would say that it's "pernicious", if you look at the context of what he was saying. Is that the way that party policy is headed? This is less about strivers, and more about the reality of globalisation and mobility.

[Esbonio]

I chose to stop living in London some time ago in favour of the country because on balance I preferred the fresh air and beauty of a rural environment to the undoubted delights of Chelsea. The advantages of country living are fairly obvious. The downside however is not always readily apparent to to those living in cities. Employment prospects are poor; public transport is poor; house prices are high; new jobs and new houses tend to go to incomers etc etc; I will not bore you. It follows therefore that private transport is a necessity not a luxury. Yes of course we can all do our bit on the eco front (even though I like many others feel the whole environmental issue is massively manipulated by the left). To that end I recently acquired one of the most efficient cars you can get. But that said, anything the chocolate orange brigade do to make private motoring more expensive and difficult will be a vote loser, the more so because they seem completed uninterested in what really worries people.

[Denis Cooper]

Don't fiddle around with Vehicle Excise Duty - scrap it. That benefits all car owners, who are a fairly harmless bunch until they actually take their cars out on the road. Then replace the lost revenue by increasing fuel duty. That costs all car drivers. Drivers with low annual mileage and/or efficient vehicles and/or who drive economically are better off, those who drive everywhere in gas-guzzlers without any regard to economy pay more, the total tax burden is unchanged. Simple.

[Editor]

DVA: Even with Governor Arnie he was completely reliant on Democrat votes in the California legislature - I understand not one Republican voted with him.

Simon C: In answer to your question, I'm not even sure there's much point debating it. It would be politically stupid to take peoples' Prague trips away from them. Our hope must be in technologies that make getting to Prague a cleaner and cleaner experience.

[Simon Chapman]

Editor,

I would agree with you about the politics of it - but Steve Norris has raised it for debate. He thinks it's pernicious, and that's the way he wants to shape party policy.

The Bishop of London, who always comes across as an old-school High Tory, would probably agree with Norris - and call this a "selfish lifestyle choice".

The Norris/Chartres approach appears to be to discourage this sort of activity altogether, and not invest in cleaner technology as you suggest.

[malcolm]

Or do both Simon,I've yet to meet anyone on either side of the debate who actually thinks investing in cleaner technology is a bad idea.

[Jonathan Mackie]

David - no serious person is now arguing that tax credits are relieving poverty and rightly so. They are provided far too far up the income scale and have been plagued by over-payment and fraud.

The total cost of the system does not only include the cost of the benefit its administrative cost to government but also the cost of compliance borne by employers. On average 10% of payroll costs are incurred in respect of the tax credit system. Not exactly cheap.

There is evidence that the cost of tax credit administration is preventing employers taking people on, in order to reduce their compliance costs.

The reason they are more inefficient than family support is that family support is a universal benefit.

I am all for scrapping them. Not only on cost terms but also because that are inefficient and act as a disincentive.

Replacing it by increasing tax allowance would cost significant amounts of money, I accept that. But it would result in huge economic benefits. Stronger growth, lower unemployment etc. But most of all it is morally the right thing to do. People on low incomes should not be paying tax on their income and them waiting on a hand out from the state. It creates a dependency culture.

I am happy to argue for a much higher personally allowance.

[Simon Chapman]

That's probably a fair point Malcolm, on cleaner technology - but the rhetorical emphasis is not on technology but on turning the clock back.

[David Robbins]

The point is that the "handout" these families get is in many cases greater than the income tax they pay. Their net incomes would therefore fall if we did what you want - abolishing tax credits but ending income tax for the low paid.

It's easy for you to proclaim this the "morally right" thing to do. But you can't expect a serious political party to adopt this policy without taking a long, hard look at the families on modest incomes who would be significantly worse off.

[G-MaN Wild]

Honestly, this is global warming were on about here, the possibility of major environmental catastrophe. Death.
I think people should start to be priced off the roads and stop taking 3 holidays a year. What wrong with trains and Blackpool? ;)

[Gildas]

Honestly, this is global warming were on about here, the possibility of major environmental catastrophe. Death.

Prove it.

[G-MaN Wild]

Yes, Gildas is indeed after a fourth term Labour Government.

[Gildas]

The point is that the "handout" these families get is in many cases greater than the income tax they pay. Their net incomes would therefore fall if we did what you want - abolishing tax credits but ending income tax for the low paid.

David makes a very good point here, and it supports a more general one that the 'cut other taxes and whack up fuel duty' brigade ignore.

When making a change to the system we are too keen to think in 'revenue-neutral' terms. I.e. we worry about the money coming into the Treasury*. To make sure our proposals are going to work politically (and morally) we should also check that when it comes to the worst off, they are at least income neutral (especially in the short term).

Thus abolish tax credits and raise allowances - yes, but find another way to make up the difference for those at the bottom end.

*Of course revenue-neutral thinking is nonsense anyway as all Laffer fans know.

[Malvolio]

The Telegraph said it all this morning. These latest wheezes are likely to turn out to be a poll tax on four wheels.

How many of the tree-huggers are going to give up their cars? Not many I suspect and I'm certainly not going to surrender my 4 x 4. I need it and I deserve it.

Curious how one of the supporters of this nonsense names himself "Lord Haw Haw" after an infamous traitor.

But very appropriate.

[G-MaN Wild]

Indeed Osbourne needs to announce a policy of lifting the poorest out of the tax system and the abolishion of tax credits.
I dont agree that the green taxes would pay for this, the policy would pay for itself. This policy also needs to be articualted in a direct and intelligent manner to the electorate. Firmly rejecting any/all critisism from Labour and Mr Brown.

[Jonathan Mackie]

David - The report you quote is so economical with the truth as to be worthless. It does not place a figure on where people would become better off once the allowance was raised.

Nor does it assume any lifestyle changes and economic advantages associated with a lighter direct income tax burden. Which all reasonable research into this subject assumes.

The total cost of the system is huge. Payroll costs are large, and the employment lag is causes because of compliance costs is problematic.

I agree in terms of where the balance should be placed to eliminate the impact of any change on those on modest incomes.

But to suggest that tax credits all the way up the income scale is a better approach to relieving poverty than an increase in the tax allowance is strange.

[changetowin]

A leading threat to Tory chances is the David Cameron's environmental agenda.

What rubbish! David Cameron has correctly identified the environment as a serious issue. What can be more conservative than wanting to hand our planet to the next generation in one piece? As well as being responsible politics, this also has the advantage of appealing to a whole group of younger voters who never thought the Conservatives cared about the environment.

The other important thing to remember is that David Cameron is proposing centre-right solutions to the environmental threat. The Editor and I had a long debate on another thread about this last week. The talking shop environmentalism favoured by Bush and Howard does not work. Australia, for example, has rapidly rising greenhouse gas emissions - something I pointed out to the Editor and he couldn't answer! Establishing a long-term price for carbon and making people pay the true cost of their actions through environmental taxation will incentivise technology. Without carbon pricing and taxation there is no incentive for investment in technology. Those who say that the solution lies in new technology are partly correct - but they fail to point out that this technology is expensive and will not be developed and adopted if there is no price to emitting carbon.

David Cameron should be applauded for identifying an important issue and being willing to take the tough decisions necessary. If we did nothing, the next generation would never forgive us.

[Malvolio]

Exactly. The message we as Tories need to get over is that cutting taxes means more prosperity for all, and we're not going to achieve that by bringing new taxes in.

I was listening on radio to a tribute to the late Sir Alfred Sherman. There was a truly great man who was excited about revolutionising the country and pulling it out of the mire into which it had sunk. A true idealist.

How can we possibly be idealistic about simply aping Labour's failed policies?

[Malvolio]

As you've probably guessed my "exactly" did not refer to changetowin's socialist post.

[Denis Cooper]

There are two kinds of tax credit, as far as I'm aware, and the simplest to replace is the child tax credit because basically the alternative was - and still is - a flat rate increase in universal child benefit. That would leave a small number of cases where the family was significantly worse off and they desperately needed the money, but it could be supplemented by a means-tested benefit scheme just for such hardship cases, not for everybody in the country who has children as now. Equally as child benefit is taxable, a chunk could automatically be clawed back from those on high incomes who didn't really need it.

[James Maskell]

Theres always another big issue bigger than the current big issue. The environment is the biggest issue facing the world this week, next week itll be terrorism, the week after that itll be poorly educated children running amok in our streets. The term "greatest threat" is just an emotional term to give more importance to the issue of the day. The Sun changes its big story almost daily...

[David Robbins]

"David - The report you quote is so economical with the truth as to be worthless. It does not place a figure on where people would become better off once the allowance was raised."

Doing that in a straightforward way is impossible. It will depend on how many earners there are in the household and how many children they have, as well as on income. However, you can expect that most of those currently receiving tax credits would be worse off (since their losses have to pay for the gains of a much larger group of people).

"Nor does it assume any lifestyle changes and economic advantages associated with a lighter direct income tax burden."

What should we assume? Poorer people may well work more as their incomes would go down at the same time as marginal rates fall. You're right about the effect on their work incentives, but is this a great political message? Richer people would get the income effect of a tax cut without the substitution effect that comes with a cut in tax rates. So they may well work less.

"I agree in terms of where the balance should be placed to eliminate the impact of any change on those on modest incomes."

How do you do that, then? That is where your saving was going to come from.

"But to suggest that tax credits all the way up the income scale is a better approach to relieving poverty than an increase in the tax allowance is strange."

A rise in the tax allowance benefits people further up the income scale than either of the main tax credits. It also gives richer people larger gains than poorer people, whereas tax credits give poorer people larger gains than richer people. So how can raising the tax allowance be a better approach to relieving poverty?

[Jack Stone]

No one seriously believes that a Cameron government will increase the overall tax burden. On the other hand only the insane believe a Brown lead government will not.
What the moaners and the anti-Camerons who pollute this site need to decide is what would they prefer because the simply fact is that if you don`t want Gordon you have to back David.

[Malvolio]

What most of us here want is a Tory government that will REDUCE the tax burden.

You seem unable to understand that.

[esbonio]

Editor

I am all for the rough and tumble of debate. However I am minded by both your recent and not so recent comments about the tone of debate. In the light of which I do not think Jack Stone's above comment "...the moaners and the anti-Camerons who pollute this site" is particularly appropriate.

[James Maskell]

For any increases in environmental taxes to have any significant effect on say car usage, they are going to have to be extremely high. In the meantime, you will lose enormous numbers of votes (Im talking millions). If I understand it right, itll also leave a large hole in the economy due to a reduction in consumer spending due to the diverted money from the public to Government. Of course the problem could be solved by an equal increase in Government spending, but we are getting into full blown Old Labour territory in that case. And before anyone argues that that money can be invested in a strong transport system and public transport, there will be a delay of a number of years before that can be acheived. What do you do in the meantime?

By all means anyone correct me if Im reading it wrong but thats my two pence. Economics was never a strong point of mine.

[Matt Wright]

I think DC has transformed our image and I have supported his approach BUT green taxes need to be handled with great caution. This could impact badly on "strivers" and have little real benefit to the environment. The fact is that the environment does not feature highly in survey work as the main factor in voting intention. The key factors are - law & order, health, education, pensions, economy, council tax, roads etc.

Matt

[Jonathan Mackie]

David - what a policy. You would rather the poor poorer provided that the rich were less rich. Not my kind of Conservatism, but each to their own I suppose.

The document you quote is useless. It selectively creates an average family but assumes they pay no tax. The reason there is no figure quoted of where the "break even" point for tax allowances in that document is that the Treasury have an agenda. Tax credits are part of creating Labour's client state. They create a cycle of dependency and should be abolished immediately.

All research on the topic of tax changes including ending tax credits factors in changes in economic behaviour as a result. The reasons your quoted source doesn't is that the Treasury opposes tax cutting. Lifting people out of tax, rasing allowances for all would result in a number of economic benefits, - increased savings, lower interest rates, higher investment levels, more growth, more jobs. Tax credits rob the economy of all these factors.

There is simply no justification for giving tax credits to people on large incomes. Cut their tax burden instead. It is cheaper, easier and less iniquitious.

Make the rich and the poor richer. That should be our policy.

[changetowin]

Of course the objective of the next COnservative government is to share the proceeds of growth between public spending and tax reduction. The argument on this thread is about how taxation should be raised. Unless you believe that there should be no tax revenue, you must see that tax has to be raised from somewhere. What is being suggested is that we should tax good things (such as income) a little less and bad things (such as carbon emissions) a little more. Seems very sensible to me.

Btw it makes me laugh so much that by proposing carbon trading I am called a socialist. If only some of the ignorant people on this site knew that this is a market approach to a problem that should concern any real conservative!

Talking shop environmentalism only produces more hot air.

[esbonio]

I have just been sampling the comments on the Telegraph's thread on the same subject and the vast majority IMO seem anti which cheers me up but also makes me query how representative the Cameron supporters on this blog are of Tory voters and supporters.

[James Maskell]

But Cameron hasnt indicated any income tax reductions...only increases on environmental taxes. Hardly looking to tax a little less on income and a little more on the environment.

How much will green taxes have to increase to lead to our own self-imposed targets on the environment to be met? Also, where will the money go? If its to be spent on large scale transport systems, what will we do in the meantime, whilst car drivers are forced out of their cars without appropriate alternative modes of transport available?

The thing that Cameron seems to miss is that relative to China, the US and India, Britain causes very little environmental damage. Any targets we meet is literally a drop in the ocean. Its the US, China and India you need to talk to, not the British...

[changetowin]

Esbonio,

DC won the leadership by a margin of 2-1 and has a mandate to "change to win". I think that is a better reflection of our membership's views than your opinion of the views of those on the Telegraph's thread!

Remember something: if our party is to form a government again we must attract the support of well over 40% of the population. This means that we must appeal to a much wider group of people than we have since 1997. This will not be done by talking just about the issues that excite our current supporters.

Sometimes in politics leaders have to take tough decisions on issues they think are really important. I am glad we have a leader who is willing to consider tough measures to tackle a real problem.

Talking shop environmentalism only produces more hot air.

[Old Hack]

They still appear to be making it up as they go along - there is nothing joined up about all this green prattle. That is the worrying bit.

I mean, this Maglev stuff is utterly fanciful.

It'll be interesting to see Cam pitch higher taxes against 'Prudence' Brown. Ye Gods! What next?

[James Maskell]

Cameron did not get elected upon a pledge for higher environmental taxes...it never featured in the election. No election is won on a single pledge. I think you need to put aside the thought that the election result 9 months ago means he still has complete authority to make up policy as he feels necessary without considering how the wider Party feels. After all, its us activists who will have to sell this on the ground in 8 months time... He won the election yes, well done to him. No one is denying the result. We simply refuse to accept that Camerons election victory ensures him the right to do what he wants without considering the consequences or what the wider Party thinks.

[Gildas]

Btw it makes me laugh so much that by proposing carbon trading I am called a socialist. If only some of the ignorant people on this site knew that this is a market approach to a problem that should concern any real conservative!

Its rationing for crying out loud! Fancy rationing that allows futures markets types to make some money off the back of it for sure, but rationing nonetheless.

And I note that apart from one chap who seems to think the world is about to end, not one of those who've rushed in to defend the leadership from all perceived slights has addressed the central complaint here. It is quite a simple one and does not dispute DC's mandate to lead or the need to change our tone: its simply that increasing fuel duty is political madness.

[Malvolio]

DC won the leadership by a margin of 2-1 and has a mandate to "change to win". I think that is a better reflection of our membership's views than your opinion of the views of those on the Telegraph's thread!

It doesn't reflect the membership's views at all. Cameron won simply because he had the image that WE the membership thought appropriate.

The views of the membership are well known and they are right-wing. Pity we never had a chance to vote on that ugly prat Portillo. If we had, you would have had your answer in spades.

[Philip]

Just because no other conservative leader in anglospere has taken this (environmental) path, doesn't mean it is wrong for us to do so, in addition to focussing on the terror threat and keeping our economies competitive, but on the latter we need to prove we now accept making money isn't everything - Mr Cameron is right on this.

But Old Hack at 2138 is right that Maglev is fanciful. Mr Osborne understandably wants to eliminate most of the need for domestic flights, but a conventional TGV-style high-speed railway line would be just as effective in doing this, bringing Edinburgh and Glasgow to about 2½ hours from London. Being linked to the existing rail network, a high speed rail line would enable high-speed trains to reach city centres, and places off the high-speed line such as Aberdeen and Inverness, thus benefitting far more of the population than Maglev could.

[Yet Another Anon]

Remember something: if our party is to form a government again we must attract the support of well over 40% of the population.
Not actually true, for one thing even if you narrow it down to those eligible to vote then at national elections between 15% and 45% of those eligible to vote don't vote anyway, it also depends how much the rest of the vote focuses on one party - a political party could get 55% of the popular vote and if that was concentrated mainly in certain seats they could still end up not winning a majority, equally a political party could win on less than 30% of the popular vote if the rest of the support was divided among a number of other parties rather than focused on one or two parties - since 1970 no single party has reached 45% of the popular vote in a General Election, the Conservative victories from 1979 to 1992 were achieved on 43.9% (majority 43), 42.4% (majority 144), 42.2% (majority 102) and 41.9% (majority 21) respectively - in 1983 and 1987 the Conservative vote was potentially much larger as many who thought that a Conservative victory was certain or were worried that the possible size of the majority could be detrimental to good legislation didn't turnout or even voted for other parties, certainly in those 4 Conservative support was actually weakest in 1979 although opposition to the government also intensified from 1983 on with turnout changing dramatically.

[EML]

I don't think any Conservative government would ever suggest merely taxing cars and forcing everyone to use public services. The aim might be to mould a change of habit. If there are far more environmentally-friendly cars available in three years time, zero tax on these cars could result in people ditching their petrol-guzzlers and going for something that is both cheaper for them personally (no tax at all, or very little) and better for us a country/planet.

[Matt Wright]

I agree that we need to reach out for that extra 4 or 5% of the voters but taxes on cars won't do that. I appreciate that this may not be the plan so to be fair we should not critcise until we know the policy. Green issues are important but a balanced approach is needed and there are many other issues that need addressing. One thing that needs reforming is the welfare state.

Matt

[EML]

Incidentally, I forget whether it was in an interview or a speech, but I distinctly remember Cameron saying that the Conservatives will never be anti-car, as cars have brought efficiency to the economy and great personal freedom to individuals. It is just huge, petrol-wasting cars that we should perhaps frown on.

[Mark Slater]

Call me an anorak but I'd prefer we pushed for the development and adoption of electric vehicles. Has anyone seen the new Tesla sports car built by Lotus in the UK but sold in California?

http://www.teslamotors.com/learn_more/environmental_benefits.php
http://www.youtube.com/watch?v=hOl_1S10jTk

If these guys at Tesla can develop a car like this with a $40 million budget (and have plenty of change) then a little bit of pump priming for UK development and helpful legislation to boost economies of scale and affordability to back it up should produce something that is a genuine help to the environment.

[EML]

You're an anorak.

Without being an anorak myself, on the face of it the cars looks good (both in looks and in general).

It depends, though, on where the electricity comes from. And currently we are over-reliant on gas, nuclear, oil and coal.

[Mark Slater]

Ideally all electricity would come from non-carbon renewables, but that is beside the point. EVs are more efficient at using the energy they consume as Tesla point out..

http://www.teslamotors.com/learn_more/energy_efficiency.php

No solution is ever consequence free of course, but aren't we trying to reduce dependence on fossil fuels from dodgy countries and trying to save the planet?

[changetowin]

Mark,

Technology has a vital role to play. The question the talking shop environmentalists need to answer is how they would incentivise technology without green taxes and carbon pricing.

[Yet Another Anon]

Ideally all electricity would come from non-carbon renewables
Use of renewable oil sources as part of any future energy policy is an inevitability, also until renewable sources can be adequately brought online nuclear power will be a vital part of maintaining power supplies while holding down use of Greenhouse gases, Biofuels involve replanting to replace plants used and so in theory should be able to balance out emmissions by absorbing Greenhouse gases back again, actually Hydro-electric power is one of the worst polluters because rising and falling water levels allow vegetation to grow on areas of dams exposed, this vegetation then dies as water levels rise and then when they fall again it rots emitting methane - it was only discovered that this was having an effect on emissions of methane in the last few years.

It's not just a matter of the environment but also that if fuel sources run out then they run out and can't be used, naturally initial use of non-renewables focuses on the easier to obtain sources and as time goes by it becomes increasingly hard and expensive to obtain it, the North Sea oil and gas reserves are running out, increasingly for Natural Gas and oil the world will be reliant on Russia or countries in the Middle East many of which are politically unstable.

[David Robbins]

Jonathan,

We are starting to go round in circles and to waste each other's time. Accusing me of wanting to make everyone poorer shows you have misunderstood the point I was trying to make.

Since this point is really very simple, I will try once more. If you want the last word, go ahead. But please don't say the Party should make sweeping changes to the tax and benefit systems unless you understand what these changes would mean for different sorts of people.

The Treasury document does not assume that families on moderate incomes pay no income tax. It just shows that the income tax they pay is often less than the tax credits they receive. (That is why, a few years ago, Conservatives argued that tax credits should be classed as welfare spending rather than negative taxation.)

This means that raising the personal allowance cannot possibly compensate such families for the tax credits they would lose under your proposal. That should be obvious. After all, you want millions of taxpayers who do not receive tax credits to benefit from a higher personal allowance. And you want to pay for this by abolishing tax credits. The money has to come from somehwere - and from someone.

Let me give you an example, similar to the Treasury's. In 2006/07, a one-earner couple on 16k with two kids would pay about 2.2k in income tax. They would also receive about 4.1k in tax credits. Taking away both their tax credits and their income tax bill would leave them nearly 2k a year worse off. And that's assuming you could raise the tax allowance all the way up to 16k!

No one is saying this is an 'average' family. Other famlies would of course be better off. But it is hardly a far-fetched example. And it is precisely the sort of family the Party would be asked about if it went down this route.

You say this analysis doesn't take behavioural effects into account. So let's do that. It is true that this family's marginal rate would be reduced from 70% to 33% and this may be an incentive to work. The sudden loss of 2k a year may also encourage them to do a bit of overtime!

If paid by the hour, this family's sole earner would have to work another six to eight hours a week to make up for the lost tax credits (and more if you only raised the allowance to about 10k). Would they think 'at least we'd been freed from dependency'? Or would they think 'the Tories want us to work much harder for the same income'?

Government is about tough choices. We can say Labour have made the wrong choices. But we cannot kid ourselves that there are easy ways to make everyone much richer which Gordon Brown refuses to implement simply because he is either incompetent or spiteful.

[Jonathan Mackie]

David - you must have a lot of time on your hands at weekends (LOL!!)

I don't think we'll agree, but tax credits are simply draining the vitality from the economy. They reduce productivity and deter incentives.

We need to look at the wider economic impact of raising the allowance. It would simply enhance the workings of the economy. Tax credits and all negative taxation damages economic vibrancy. They should be abolished and we should be in the vanguard of proposing their abolition.