David Cameron's economic priorities

After yesterday's remarks on security issues - in Leeds - David Cameron focused on the economy today during visits to Cambridge and Hertfordshire.  This is the second of his statements on the 'five big challenges facing Britain'.  Mr Cameron emphasised three economic priorities:

(1) A less regulated economy.  Acknowledging that he's not the first Conservative politician to make this promise, Mr Cameron said: “I’m not going to make simplistic promises about cutting red tape. Politicians have been saying that for years.  The truth is that we will never succeed in cutting back regulation unless we change our society’s attitude to risk. We need to treat adults as adults and change our risk-averse, compensation culture. That means a major culture change in this country, a change that I want to lead."  Oliver Letwin, an early supporter of DC, gave a big speech ('Nothing Ventured, Nothing Gained') on risk some time ago and his approach might be inspiring Mr Cameron now.

(2) Competitive tax rates and first-class public infrastructure.  In a classic example of triangulation Mr Cameron positions himself between "Labour’s extreme approach, which is to take all the proceeds of economic growth and spend it themselves" and a more ambitious tax cuts policy (perhaps of the kind we expect to hear from David Davis tomorrow).  Mr Cameron's middle way is "to share the proceeds of growth between tax reduction and public service investment".  "Education and transport are," he says, "vital components of a long-term economic policy. How will we compete in the world unless we have a well-educated workforce and the best graduates?  And how will our economy work properly if we don’t solve our transport problems which make it such a hassle for people and goods to move around?  We need to invest in these areas while keeping down the burdens on the state. That’s why we have to take tough decisions like supporting tuition fees for higher education and charging for new roads."  This is Mr Cameron's co-payment idea.  He concludes on tax: "It’s just irresponsible to pretend that we can get good public services on the cheap, or that short-term tax cuts are all we need to do to build a competitive economy."

(3) The third priority is pensions.  DC: "If we don’t sort out our pensions crisis, our economy will be crippled by the additional burdens that will fall on the taxpayers of the future.  Labour are ducking this challenge, and we must not. I will launch a thorough-going review of pensions policy, based on long-term considerations rather than short-term electoral advantage. This will involve making tough decisions. We need to be sure that a Conservative Government after the next election is equipped to provide Britain with a state pension system and a framework for private pensions which, together, restore the incentive to save, eliminate unfairness for women, and give everyone a decent income in retirement."

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Comments

[Richard Carey]

"Oh look Cllr Lindley is back!"

Here we go again. I do think that this question about Iain Lindley's handle has been answered on here before, it being to do with this being the title of his own blog and hence helping search engines find associated articles (it might even be a TypeKey issue?).

"I think more people should have there say."

And I think more people should be able to spell, but I'm just going to have to learn to live with my disappointment!!

"The Tory party should appear grown up"

Yes, it should. And I'm not at all sure that any posts like that are helping in this...

[a-tracy]

I'm too tired to argue with anyone but with inflation now running at 2.5% (using the watered down Brownflation) and economic growth set for circa 2% how can anybody distinguish this as growth!

By my calculation this makes a contraction of 0.5% and if you factor back in everything Brown's taken out in calculating his Brownflation figure then I'm sure that the contraction would be even higher.

Maths has certainly got a lot worse since I was at school. If you remove the money that everyone seems to be borrowing from their spending patterns is anybody actually better off? As for James M saying if the NMW was removed would reduce his wage he wouldn't need such an amount of wages if we weren't getting stealth taxed through the nose. For many years James M it hasn't been about your Gross wage but rather your net wage less living expenses and tax.

[Yet another Anon]

The Unionists in Ulster hold 10 out of the 18 seats, there are 9 DUP MP's and a single UUP MP.

The Conservative and Labour Governments of the past and present have all betrayed the Unionists - the parliament at Stormont was scrapped, Mrs Thatcher signed the Anglo-Irish Agreement, in the 1990's the Major Administration held talks with the IRA of sorts and denied it and cross border bodies were established, this government set up formal power sharing arrangements in the Northern Ireland Parliament and has effectively surrendered to the IRA.

A parliament of Ulster should be restored with no formal power sharing and Sein Fein should be banned and members of the IRA\Sein Fein rounded up and executed.

[Daniel Vince-Archer]

"Members of the IRA\Sein Fein rounded up and executed."

How nice of you to join us Mr. Hitchens. Do the wardens know you've escaped from your padded cell?

[FG]

I am not connected to David Davis.
I just say what I see.
I do not wish to be banned Editor.
I like this site, but I just think that calling yourself Cllr is slightly strange.
I may draw all of your attentions to Quentin Letts in the Mail who gave John Reid hell for insisting on being titled with the prefix 'Dr.' especially as Brown, McShane, Redwood,Letwin and Willets do not.
I shall not return to the subject, but for the record, I reiterate my amusement.
FG

[James Hellyer]

"Our editor is quite right about the tax cuts. We don't have to hope they would produce more economic growth and more revenues for public services. The evidence is out there in the United States, in Australia, in Ireland, in many of the Eastern European and Baltic nations, and the UK in the 1980s."

Most of the evidence concerns corporation tax rates, rather than income tax rates. Businesses are attracted to low tax economies.

The case with personal taxation is trickier. For example, Bush's tax cut delivered larger revenues in their first year largely because individuals and businesses deferred profits into the next period whne those profits would be subjected to the lower tax regime. The tax take in the pre-cut year was down.

Tax planning before a tax cut takes effect, who'd have thunk it!

[Sam Alexander]

Cllr Lindley seems to me to be like one of those attention seeking kids in the playground, most probably bullied. He appears to look like a pig from his website photos - perhaps he should stop eating, or could this be a knock on effect from your childhood! Not only does he look like a pig he is also pig headed. Get a grip you silly, little minded (not weight wise) man. I agree with FG. Fatsos like Lindley should be banned from this site!

[john Skinner]

You can recognise a Hellyer rant after a couple of lines.
Be honest: how many of you scroll down to confirm your assumption, then move on to the next post?

[john Skinner]

You can recognise a Hellyer rant after a couple of lines.
Be honest: how many of you scroll down to confirm your assumption, then move on to the next post?

[Sam Alexander]

Are you a parrot, or do you have a really bad stutter?

[john Skinner]

Sorry Sam, but I only clicked once.
By the way, did anyone see "Question Time" this evening?
Hellyer wasn't on, but as soon as I saw Eric Forth and Edwina Curry, I fumbled desperately with the remote. Doesn't Tory HQ have any say in who gets on to these high profile shows?

[john Skinner]

Sorry Sam, but I only clicked once.
By the way, did anyone see "Question Time" this evening?
Hellyer wasn't on, but as soon as I saw Eric Forth and Edwina Curry, I fumbled desperately with the remote. Doesn't Tory HQ have any say in who gets on to these high profile shows?

[FG]

I criticised Lindley properly, that is going over the top I think. My posts were meant to try and highlight an area where i thought we could see some progress.This is mud slinging and back stabbing. Shame on you Sam. Iain - may I say that these comments are neither deserved or in any way justifiable. Keep posting Iain, Sam I hope the Editor deals with you...

[Blue2win]

To cut taxes we have to win an election and stay in government. Hands up those that really believe we can do this on the Hellyer manifesto and style?

[Rick]

"and look at the corporate tax and income tax stats from 1979 to 1987. You might also want to look at how the rates were changed at http://www.hmrc.gov.uk/rates/archive.htm"

I see you still have a lot of economic illiterates around. Corporation Tax rates are irrelevant - wholly irrelevant because noone cares. If you look at the 1970s corporations paid no tax, many still don't. There was Inflation Accounting on the Inventories which cut mainstream corporation tax. Many companies had Unrelieved Advance Corporation Tax like Lonrho because they did not generate UK profits - I think they bought Brentford Nylons for tax reasons.

Any serious MNC runs its global profits stream through a Dutch mixer, and most corporations had huge Deferred Tax liabilities.

All cutting tax rates did on corporation was to collapse investment. When Investment was deductible against Corporation Tax it was a lower net cost but cutting tax rates increases its cashflow impact and it was cut to increase dividends to shareholders.

Now we have the absurd situation where the Company has a lower effective tax rate than its employees. Think that someone on £40.000 pa is in a higher tax bracket than Shell and certainly pays much more tax than News International which pays zilch

[Editor]

I have added Sam Alexander's IP address to the banned list. His contribution was just puerile.

[Rick]

Now companies no longer have LIFO reserves and cannot defer tax Corporation Tax amounts to a tax on cashflow since many companies do not invest............so companies swap Debt for Equity and use the tax shield on debt to reward the Private Equity crowd with dividend payouts on Prefs..............the companies become increasingly debt-laden and ready to cave in when market conditions turn - such as Courts, Furnitureland, Allders, and who knows how long Focus, Maplin, etc will last ?

I bet Philip Green's empire will be paying very little Corporation Tax is years to come, and Vodafone I doubt pays any after its huge Licence Fee to the Treasury.

If you look at the figures, National Insurance, Income Tax, VAT dwarf the pitiful sums raised in Corporation Tax - the Thatcher years shifted tax from Corporations to Individuals

[John Coulson]

I don't wish to get involved in the argy-bargy of previous posts but I must register my amusement that someone who is over 21 feels in neccessary to post on here as Cllr. It is trivial, yes, but I fear it will continue to be brought up and perhaps overshadow actually what Iain Lindley is saying. As for the refernce to google - I don't think that many constituents of yours would actually post Cllr into google. It is more likely that they just put Iain Lindley in. It would surprise me if the people you represent actually know who their Cllrs are. I think that they would probably contact their MP with major issues.
This is not a post to stir trouble - merely to put across a point of view!

[Editor]

John Coulson: This Cllr thing is getting really boring. Can we all move on please?

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