A rare political rant today, which you are of course free to ignore. Alternatively please do have your say (politely, constructively) in the comments. My hope is that by keeping politics restricted to these occasional blood-letting rambles, we can hopefully keep the rest of the site and article comments relatively ideology-free.
Last time we faced a general election, the economy was uppermost in voters’ minds. I even wrote a few posts on Monevator about what I thought needed to be cut, slashed and kyboshed – and also where Government might helpfully spend some money.
Of course, over the five years that followed neither my manifesto nor anyone else’s was achieved.
That’s what you get from a Coalition government that takes office after the money has run out, and yet must minister to the needs of a country that’s grown comfortable on 15 years of economic growth and free-flowing public spending. A queer pitch indeed!
But you know what? I think it turned out okay.
Spending was reigned in a bit, taxes were cut a bit – usefully from the bottom with the personal allowance raise, and from the top, with the end of the mean-spirited 50% rate of tax – and getting the national books in order has at least became accepted lip service among all the parties, if not always the reality on the ground.
Oh, and the NHS has not been destroyed. Millions of people do not languish on the dole queues. At the same time, George Osborne is behind his own targets for tackling the deficit.
Muddling through a crisis like this is one way forward.
If I have one major criticism, it’s that there wasn’t boldness on true infrastructural investment, given the incredibly low cost of long-term borrowing.
I have no appetite for permanently higher state spending as a share of GDP from here, nor for Gordon Brown-style “investment” that walks out the door every evening in the form of higher salaries.
And I understand that some are skeptical of the value for money from any major projects.
Nevertheless, the fact is there are some things a country needs, such as roads, rails, airports, bridges, tidal and nuclear power stations (and in the UK simply more houses) where the state can usefully get involved.
In the earlier years of the crisis, I think such investment would have delivered a lot of bangs for the buck. It might have been a wash overall long-term, in terms of return on investment, but it would have meant more jobs during the downturn and making something good out of a bad situation.
Also, rather like buying shares in a bear market, the odds are surely more in your favour if you spend money as the state when demand from the private sector for the same skills and opportunities has evaporated.
Not doing more visible state spending in the UK is not the glaring failure that I think it is in the US – their roads and bridges are literally falling apart – but it’s still been a missed opportunity.
Six of one and half a dozen of the other
So what about the next five years?
I haven’t written much about the economy recently, and I won’t do so now.
In the eyes of all but the ‘house of paper money, mountain of debt’ fundamentalists, we’re clearly out of the emergency ward. Reasonable people can disagree about how much further and how fast spending should be ‘cut’ (or more likely at best held in real terms) or where the axe should fall. Plenty do elsewhere.
But I don’t think voters are so bothered in this election.
All the main parties have signed up to some sort of fiscal restraint (in the loosest sense of the word) and my gut says the existential doubts that led to everything from the Occupy movement to the rise of UKIP has waned.
Also for everyone who fears, say, a return to profligate spending by a Labour government, there’s another who worries about the rise of inequality and the fact that the super-rich have done so much better over the past five years.
Often, as in my case, those worries reside in the same numbskull!
So I don’t think people believe they are voting to save the nation this time. Rather, they are much more likely to vote based on the outlook for their own wallets.
True, we all know there’s a big economic element to that end.
If a Labour government spooked the money markets, the pound fell and interest rates soared, that could have a much bigger impact than getting a few hundred extra quid in free childcare.
Similarly, if a Conservative/UKIP alliance took us out of Europe and started dismantling public services along the way there could be massive upheaval, too.
But I think there are so many often-contradictory permutations that many floating voters aren’t even bothering to evaluate them, and they will instead resort to self-interest to guide their vote.
And it’s floating voters who swing elections.
It’s housing, stupid
I’m the most floaty voter you’ll ever meet – I have voted for four parties to my recollection, in national and local elections – and I’m finding the current choice amongst the most difficult ever.
I had pretty much resolved to go Conservative again this time. I judge we can do with another five years of half-serious attempts at curbing state spending, and Ed Milliband’s talk of price controls and unilaterally raising the minimum wage really bother me.
(I’m a fan of the minimum wage, incidentally, but only when it’s done through the painstakingly established regulatory process that’s been put in place. Not when it’s lifted on a whim by a party chasing cheap votes).
However in the past few days the Conservatives have come out with two policies that I personally find repellent.
Firstly, the proposed changes to inheritance tax to lift £1 million family homes out of the levy altogether.
I know most people hate inheritance tax, and I’m always accused of being a left-wing commie agitator when I say I want it to be raised.
But the point – which my critics never seem to address – is someone somewhere has to be taxed – unless you’re a true zero-State free market radical, which almost nobody is.
All the major parties are really talking about is 2-5% difference in State spending around the 40% share of GDP mark. So however you do it, that’s a lot of tax that needs to be collected from somewhere.
On principle, I think it’s better to more heavily tax dead people and their heirs who did nothing to earn their windfall gains, because you can then reduce the taxes levied on earnings and on the wealth created by entrepreneurs.
As I say, I know most of you don’t agree with me. Even my left-wing friends go red when they think about paying tax on their parent’s semi-detached pile with easy access to good grammar schools.
Oh well, I’ve never written articles for this website to win fans.
But even if you don’t like inheritance tax, you must surely at least question the logic of this particular Conservative move.
Because if you were going to reduce inheritance tax on any particular asset you could choose, the stupidest one to favour in the UK has to be residential housing.
Save now, pay later
It was one thing to turn pensions into inheritance tax planning vehicles for the mass-affluent, which is what has effectively happened in the past 12 months.
I didn’t agree with it, but there you go.
However to take an asset – UK housing – that is in structurally short supply, where high prices cause daily misery for millions, and to make it even more attractive to sit in it, unproductively squatting for future gains – that is downright irresponsible.
What moderately wealthy empty-nesters living in a capacious four-bedroom house are going to downsize now, knowing that all it will do is expose the money they release to inheritance tax?
On the contrary, they will be advised to consider buying even bigger and more expensive homes to try to shield their (children’s) assets.
Mass downsizing alone won’t solve the housing crisis, but it would be a start.
I want capital gains on residential property (deferred until the point of death), so you can see that this policy is the opposite of where I think we should be going.
The only other option is even more building – something in the order of 300-400,000 homes a year for at least the next decade.
We’re barely doing a quarter of that.
Many of those new homes will have to be built in green belts and pretty market towns across the South East.
I wonder how that will go down?
We need to build at least 250,000 more homes annually anyway, even if we put the housing stock we’ve already got to more efficient use.
But this policy just makes things worse.
No way to compete
One thing you need to know about me to understand my perspective is I was not born into a comfortable middle-class home in the South East. The world was not my oyster.
I came to London from the provinces with a suitcase, and my instinct is always going to be to think of other smart young people who want to do the same.
Already the wealthy middle and upper classes are re-capturing the arts and media scene wholesale – a change that has happened in my lifetime – as their children are about the only ones who can afford to do the unpaid entry-level work demanded, or who can think about a lifetime of sub-par earnings in a city where house prices are approaching 10-times the average wage, knowing they’ve an inheritance to look forward to and plenty of help in-between.
Their parents are there to assist them with tuition fees, deposits for flats, and all the rest of it.
The resultant crushing of the meritocracy that emerged in the 1950s and 1960s is bad enough when applied to the arts, but I can now foresee it impacting the sciences, engineering, and even entrepreneurship itself. (I don’t think it’s a coincidence that every new Silicon Roundabout founder I hear has a plummy Home Counties accent).
You might say you don’t give two hoots, because you’re in the haves and the have-nots can look after themselves.
Fair enough, from a personal perspective. Ugly but honest.
However what is the impact going to be nationally if we move to a society whereby wealth and opportunity is channeled down a narrowing funnel of families, and real social mobility is curbed?
I’ll tell you. It means more mediocre but well-educated offspring of parents who’ve made it (or, eventually, whose own parents made it) doing mediocre work in positions they are occupying because some smarter kid from anywhere 50 miles from London never showed up to compete.
A nation increasingly run and ruled by the Nice But Dim types who currently thrive as upscale estate agents in London.
At least until China and India come along to eat our uncompetitive lunch.
I shudder.
Flog it!
Now I’ve got my left-wing ire up, I will turn to the subsidized right-to-buy social housing association policy that’s been revealed this week by the Tories.
Yet ironically my complaint here comes more from the free-marketeer who sits on my other shoulder.
Don’t get me wrong – given my comments above, I clearly think it’s idiotic for the Conservative Party to encourage the sale at a discount of what little social housing we have left.
However I think it’s even worse when you consider low-earners who’ve scrimped and saved to buy one-bedroom flats or starter homes in the private market – or who are perhaps still renting and saving to do so.
They will be left to watch glumly as those who happened to be in housing association property are granted a one-off windfall gain by the State.
It’s another lottery. Not the genetic lottery of inheritances and the Bank of Mum and Dad, but a lottery of happening to be sitting in the right state assets when the ruling party of the day decides to give them away on the cheap.
How fair.
Nothing really fits me
At this point I’m naturally thinking I might have to cast my vote elsewhere, despite the Conservatives being the party I think is best having their hands on the tiller for the another five years – and despite the fact that they would undoubtedly be the best for my own wallet.
Sadly Labour has veered to the Left, while the Liberal Democrats have some silly anti-capitalist policies in their manifesto, particularly regarding capital gains tax.
(Before somebody pipes in and claims I’m inconsistent in being against reduced capital gains tax allowances but all for inheritance tax, here’s a clue – me and Richard Branson took risks when we allocated our money and we’ve made losses and gains along the way. Your child simply happens to be related to you – they did nothing to get the money, and the only risk they took for their inheritance was their sense of personal achievement being smothered by your generosity).
What about the fringe parties?
I think UKIP has jumped the shark – it did a useful job in making immigration something the chattering classes can cautiously discuss without being socially ostracized, but the party itself is clearly populated by rank-and-file nutters.
Indeed I’d summarize the fringe party offerings as:
- Green party – Climate change is coming! Therefore we need a bloated State-run economy that slams GDP into reverse and reduces carbon emissions by making it so that nobody can afford petrol.
- Plaid Cymru – Wales! Wales! Aren’t we good at the rugby?
- SNP – Wants another once in a generation vote on leaving the Union, six months after the last one.
- UKIP – A sword has been embedded in a stone in an English market square. Whomsoever can draw it forth will be the next king of Albion!
So those aside, I’ve collated below the three main party’s manifesto pledges that I think are most relevant to Monevator readers, from a personal finance and investment perspective.
In other words, I’ve focused on pledges that impact earned income, wealth, and spending on things like rail fares and childcare.
To that end I have not covered benefits, as I’ve assumed few Monevator readers are living in social housing on welfare. (My apologies if that’s you – and I admire your aspiration.)
If you think I’ve missed out anything important from a personal finance perspective, please do let me know below, and if I agree I’ll add it to the list.
Conservatives
- Raise the personal allowance for income tax to £12,500
- Raise the higher-rate / 40p tax rate threshold to £50,000
- Raise the inheritance tax threshold on family homes to £1m by 2017
- Pensions relief hit for high earners. Manifesto says the £1m inheritance tax lift for family homes will be paid for by: “Reducing the tax relief on pension contributions for people earning more than £150,000.”
- Extend the right-to-buy scheme to housing association tenants in England
- No income tax payable by those working 30 hours on the minimum wage
- Double free childcare allowance for three- and four-year olds to 30 hours
- No rise in VAT, national insurance contributions or income tax
- Clamp down on tax evasion and the “aggressive” tax avoidance
- Increase the minimum wage to £6.70 by the autumn and to £8 by the end of the decade
- Continue to apply the state pension triple lock system – so at least a 2.5% rise every year – and introduce a single-tier pension
You can read a summary of the rest of the manifesto at the BBC, or you can read the whole thing at the Conservative’s website.
Labour
- 50% rate of income tax for those earning over £150,000
- No increase to the basic or higher rates of income tax, National Insurance or VAT
- Cut tuition fees from £9,000 to £6,000 a year
- Unspecified pension hit for high earners. The manifesto speaks of: “…restricting tax relief on pension contributions for the highest earners and clamping down on tax avoidance.”
- Raise the minimum wage to more than £8 by October 2019
- Protect tax credits for working families so they rise with inflation
- Introduce guaranteed three-year rental tenancies and bring back rent controls
- Freeze rail fares for one year
- Extend free childcare from 15 to 25 hours for working parents of three and four-year-olds
- End marriage tax allowance
- Stop non-doms avoiding tax on overseas earnings
- New National Primary Childcare Service, guaranteeing childcare from 8am to 6pm
Read more of the manifesto via the BBC’s summary, or see the whole thing at the Labour website.
Liberal Democrats
- Increase the personal tax-free allowance to at least £12,500 by the end of the next Parliament
- Higher personal income and wealth taxes? (They say they will create “a fair plan” to reduce the deficit by ensuring the rich pay “their fair share”)
- Higher taxes on capital gains tax and dividends? (The manifesto promises: “…reforms to Capital Gains Tax and Dividend Tax relief”)
- “Refocusing” Entrepreneurs’ Relief
- Mansion tax on homes worth more than £2 million
- Hit on pension relief for high earners? Manifesto says: “Establish a review to consider the case for, and practical implications of, introducing a single rate of tax relief for pensions, which would be designed to be simpler and fairer and which would be set more generously than the current 20% basic rate relief.”
- Withdraw eligibility for the Winter Fuel Payment and free TV Licence from pensioners who pay tax at the higher rate
- Make sure rail fares do not rise faster than inflation over the Parliament
- Establish new “rent-to-own” homes, where your monthly rent builds up a deposit in the property
- Build 10 new garden cities. (All the parties say they have plans to build 200,000-300,000 new homes a year. I think it’s mostly hot air and tinkering at best, but this Lib Dem garden city plan is at least something different)
- Another remix of free/extended childcare
Read more of the manifesto via the BBC’s summary, or see the Liberal Democrat website.
Who would you vote for, from a personal finance and investment perspective, and why? Let us know below, but please note I will be deleting any swearing, frothing, or truly swivel-eyed ranting. (I’m allowed a small amount of the latter above. It’s my pub, and I’m the landlord).
Damn right. I’m pretty pro-market, which would normally lead towards the Tories, but the inheritance tax and new right to buy policies aren’t pro-market in the slightest. Where’s the deregulation of land use to allow the market to supply more housing?
Conservative for the main points in your summary
Raise the personal allowance for income tax to £12,500
Raise the higher-rate / 40p tax rate threshold to £50,000
Raise the inheritance tax threshold on family homes to £1m by 2017
No rise in VAT, national insurance contributions or income tax
In general the Conservatives are at least talking about simplifying regulations, however I’d like to see more movement on simplifying the tax and welfare systems. The more simple a system, the less opportunity to flounce its rules, from aggressive tax avoidance schemes to defrauding unemployment benefits.
Great article, much appreciated. I find the absence of any pension-related items (unless I managed to miss them) in the proposals summarised here for any party rather disturbing; maybe this means there are no plans, but my suspicion is they all plan a pension raid of some kind but are keeping quiet.
While I don’t delude myself my vote counts for much (I live in a safe Labour seat anyway) I vaguely incline towards the Conservatives; I don’t like them much (including on non-financial grounds which are off-topic here) – I largely agree with most of what the article says – but the other parties all seem more anti-capitalist and pro increasing the size of the state. I’m well paid and I appreciate I’m (in part) lucky to be so, but I feel I’m already paying more than my fair share as it is, without growing the tax burden even more.
“If I have one major criticism, it’s that there wasn’t boldness on true infrastructural investment”: no, no, no. The dimwits who want to build HSR2 should be given more money to spend on toys? No. If there were a magic way to have them spend intelligently on infrastructure, I’d relent.
I incline to vote against Cameron on the grounds that he’s a version of Blair: the attack on Libya is quite enough reason to sack him. I can’t possibly vote Labour if they want rent controls, especially since there’s no reason on earth to suppose Moribund wouldn’t do a Libya if he felt like it.
Please can I vote for Maggie?
Picking up on the ‘deficit’ promises.
The two/three main parties talk about tackling the deficit, as though all will then be fine. Suspect Joe Public is hazy on the meanings of the words ‘deficit’ and ‘debt’.
How long can the west be carried by the east inward cash flows generated by the west purchasing eastern goods?
How about restraining foreign investment into our housing market, rather than building over the UK countryside?
We have already sold off much of our infrastructure, and housing looks set to follow.
Thanks for the summary on the choices being faced.
Another floater here.
I agree with your criticisms of the Tories, but I have to vote for them anyway because otherwise Labour will return to finish what they started.
Steve – Pensions is a nightmare all ways really. Good summary from Hargreaves Landsdown, parts of which I have lifted below:
Conservative – pension tax relief cut for contributions for those earning over £150k pa. As income increases, the annual allowance will fall, so that anyone earning £210,000 or more will have an allowance of just £10,000. Contributions up to the allowance will receive full tax relief (up to 45%), but contributions over the allowance will effectively receive no tax relief. No plans to reform either £40k annual or (farcial) £1m lifetime allowances for anyone else.
Labour – Labour plans to limit tax relief to 20% for anyone with income over £150,000 on a cliff-edge basis so no change if your income is £149,999. The annual allowance would also be reduced from £40,000 to £30,000 for all investors. Also talk of further reducing the lifetime allowance…
Lib Dem – Pensions Minister Steve Webb favours a single rate of tax relief of 33% for all. Bonus for basic rate taxpayers but a double-taxation shafting for everyone else.
This, combined with cross-party consensus on plans to raise the earliest age at which you can access your pension pot and then to go further by linking it to state retirement age (‘early’ retirement from age 63, anyone?) make the prospect of putting more cash into a pension after the election rather unappealing for higher earners.
Plague on the lot of ’em, I say.
@Steve @edge — Cheers for thoughts. I can only see specific numbers on pensions in the manifestos from the Conservatives. However on reflection I agree the vague noises from the other parties do warrant a mention. (In fact their vagueness might be seen as even more troubling!) I’ve amended the summary lists above accordingly.
@TI @edge Great, thanks. I am on a deliberate low-information diet so it’s great to get the facts distilled for me like this.
On a pure “I’m alright Jack” basis, this is not as bad as I’d feared (unless the Lib Dems get their way); I don’t earn £150k+. Can’t believe the stupidity of a cliff-rate threshold in the Labour proposal; whatever your politics, I don’t see why such a sharp edge is ever desirable.
Is anyone proposing an ISA lifetime cap, big changes to ISA rules or anything similar?
I am content, and always have been, that the likelihood of my single vote making any difference to the outcome, even in the marginal constituency in which I live, is sufficiently small for me not to employ any time in voting. The best of luck to those of you who do vote but “include me out”. Whatever the political result, I shall simply trim my sails to the wind as I always do, and happily get on with my life.
What if everyone else took the same stance? Then I would vote!
@Topman I have a large degree of sympathy for your position, especially your excellent rebuttal to the trite “what if everyone did that?” argument. Have you by any chance ever read Harry Browne’s “How I found freedom in an unfree world?” I found it slightly OTT but it had (and continues to have) a large influence on my thought processes since I read it a couple of years ago. Your post is almost a perfect distillation of the message I took from the book.
@Steve
Thanks – kindred spirits can sometimes be hard to come by in our fearfully PC country. No, I haven’t read the particular book you cite but it sounds interesting. Best wishes.
Good article this – I wholeheartedly agree with your comments on inheritance tax. I work in the tax profession, and at heart I believe that one of the key purposes of taxes in general is to be redistributive. This obviously isn’t popular with people who are going to pay more in taxes, to lessen the burden on those with less. Taxing inheritance (including gifts made during lifetime) by applying this to the donee rather than the donor would encourage the spreading of wealth more widely. Or maybe that’s just wishful thinking.
Oh, and a tax tip for higher rate taxpayers that haven’t already made a contribution to their pension in this tax year – probably best to pay this before the election (or certainly the 1st budget of the new government), as it’s widely believed that whoever gets in is likely to reduce tax relief on contributions. So bank that higher rate relief now! Basic rate taxpayers might want to wait to see if a flat rate is introduced (unlikely to be lower than the 20% it’s at now).
Thanks for a great distillation of the various political pledges.
I totally agree with the unfairness of the windfall and right to buy Social Housing, it seems like a last minute gesture to help “poor folk” to pick up a bit of capitalist spirit. The irony being that it was probably Labour that got them into that social housing in the first place, luckily as most couldn’t get a whiff of a housing association flat now. Also, even with a windfall deposit they will probably struggle to get a mortgage on the remainder as they most likely have a lower income which is why they were in social housing in the first place. Or will the situation be taken advantage of, and the property snatched back when payments can’t be maintained?
Anyway, I struggle with the details of just one pledge let alone the other parties. How about a Monevation party?
I’m afraid I would never base my vote purely on what would benefit me personally at least in the narrow, financial sense. Cringe making and off topic as this may be, it’s true.
Given this I shall be voting Green as I don’t live in a constituency where it will make much of a difference. I leave it to George Monbiot to explain why.
I am voting Green, purely due to them claiming to reform the Ponzi money scheme. For anyone that doesn’t know, read it here and then think about it for a minute:
http://www.bankofengland.co.uk/publications/Pages/quarterlybulletin/2014/qb14q1.aspx
Particularly http://www.bankofengland.co.uk/publications/Documents/quarterlybulletin/2014/qb14q102.pdf
Good article. I suspect that the right to buy housing association houses is an attempt to buy some ‘natural’ labour votes. Re the housing crisis, you also need to address demand, not just supply.
@ Topman: I once voted in an election where the winning candidate won by just two votes. Obviously everyone who voted for him (and against him?) can say their vote mattered the most but I think I can still legitimately say that it was my brother’s and my vote which made the difference. It was so close that it was run again the next week and he won again by a far larger margin but IMHO votes do count. If you’re against the system (or whatever) then spoil your ballot as these are counted. Some countries including, IIRC, Brazil and Australia, force everyone to vote but I would be against this personally.
All of the manifesto pledges sit ill with a country that still borrows £90bn a year to balance the books
And half of that £90bn is interest payments even when 10 year gilts yield less than 2%
The truth really is that the coalition has always made room for sweeties for “their people” whether its the triple lock for pensions, right to buy, pensioner bonds, the new tax free allowance for savings or just an overnight train service and a new ski lift for Danny Alexander’s constituency
I will vote labour because
– I don’t want to live in a rerun of downton abbey
– I also think we can earn a damn sight more than 2% a year on infrastructure investment in this clapped out country
I think that Labour are clearly the least-worst option, particularly on the economy (amazingly enough)!
I think the Tory flagship policies are ludicrously unfair. I worked hard at school, worked hard as an undergrad in a good university, worked hard as a graduate (where my research has enabled a German company to make a new fancy instrument) and work hard at my (non-finance) job. (And I mean actually working hard, not just claiming to.) I live in rubbish accommodation in London (where the jobs are for young people) which flouts many housing laws and has a clueless landlord.
I would be in a far better position financially had daddy give me a load of money for a deposit, lied on a mortgage application and sat on my arse for the last decade in my nice home – it “earning” more than I have. Similarly, I could have simply sat on my arse without even doing that – spawned a few offspring, sat in my paid-for house, and collect my hundred grand in a few years!
Why the hell should my money be used to make my situation worse? At least the sillier Labour policies are really rather minor.
Looking back rather than forward, while Labour were at the helm for the crisis, remember that it was not caused by Government profligacy, but by reckless gambling by our bloated financial sector. (Interestingly, all the crimes they were committing at the time and after have affected us less that the simple incompetence/greed.) Don’t listen to people trying to alter history to suit their ends.
Personally, I think the worst thing they did economically (apart from controlling the above) was letting housing costs spin out of control by enabling easy debt. There are more crass things, like the gold silliness, but these had only minor effects.
For both of the above main points, which are vaguely related, the Tories wanted even less regulation, so it would have been worse. It’s not really fair to punish the party in charge if the other guys would have made an even bigger mess of it.
Labour did get some things right – we’re not in the Euro, they acted decisively (even with dithering Gordon in charge) when the midden hit the windmill, and things like education and the NHS really did improve over their tenure.
The Tories economic incompetence has led to various self-inflicted disasters. (ERM, Lawson boom, 2010 recovery destruction etc.) If I can remember the early nineties misery on the news from when I was a child, how come no-one else can?
I have a pet theory that the Tory housing insanity is how they plan to reduce migration:
1) Make housing ludicrously expensive.
2) Give all sorts of help to people who can’t afford it.
3) Don’t give any of that help to new arrivals in the first 3 years or something.
Whether that’s the secret plan or just a ‘happy’ side effect of the more immediate (disastrous but popular) effects, I do not know.
I do know that they can keep pushing housing up from here – look at Australia and Japan.
Oh and here’s a shout out for the Greens for actually offering something different. It’s totally unworkable overall, but at least they are trying!
(I find some of their ideas interesting – I wonder what would have happened if instead of the QE money being used to distort the markets trickle-down style, it had been given out as citizen’s income?)
Sorry for the poor structure. I’m ranting as I’m so angry by the Tories’ unfairness! So much of their stuff seems to be there just to spite me! (Even little things like the “well done on getting married – have some free money, but only if you’re a ‘proper’ family with a high earning man and a low earning woman.”)
Argh!
@Greg
Gordon Brown deliberately stoked the “bloated financial sector”. That was Labour policy, let The City loose, collect the tax and hand it back to people as tax credits. Ed Balls is hardly a clean break from the past.
Want to know why housing is expensive? http://news.bbc.co.uk/1/hi/business/3478635.stm (Gordon knighted the boss of HBOS!!!).
Now don’t get me wrong this does not mean the Cons or Dems are any better, just different sides of the same poison coin.
Read my previous post on exponential money creation (by the Bank of England no less…) and think about why houses are so expensive… “This description of money creation contrasts with the notion that banks can only lend out pre-existing money, outlined in the previous section. Bank deposits are simply a record of how much the bank itself owes its customers. So they are a liability of the bank, not an asset that could be lent out. A related misconception is that banks can lend out their reserves. Reserves can only be lent between banks, since consumers do not have access to reserves accounts at the Bank of England”
Sorry promise this is the last one from me for this PM https://youtu.be/a9-7cHs7OgE
Cheers all.
@Underscored — I’d think we’d best leave theories about the nature of money for another day please. As you say, all the parties are planning on keeping money and fractional-reserve banking as currently comprised, so I think we best call it off-topic from here please. 🙂
@Greg @Cerridwen — I have voted Green in local elections, despite them being very far on the other end of the spectrum from me when it comes to economics. Mainly because I think environmental degradation is woefully under-debated, whatever Clarkson says when he’s not punching people.
I’d be happy to see 3-5 Green MPs in the mix to make a bit more noise and maybe even heft some power on environmental issues. However I would never vote for them as a serious party of government.
It seems that these days there is no problem that the govt cannot solve by raiding pensions.
For the Conservatives to fund the IHT reduction — on property, no less — by taxing pensions simply takes from those who might need it in future and gives it to those who definitely do not. Their manifesto claim to be for “working people” is so transparently spin that it is laughable.
The Lab and LibDem policies on pensions are equally bonkers. A bit less defined in places, but bonkers without doubt. Under Lab you might as well simply ban high earners from saving for a pension outright. At least that way they can save outside and then breathe a sigh of relief at the bullet they will dodge when (surprise!) pensions are hit again to fund whatever pet policy the govt comes up with to bribe voters next time.
A bunch of economic illiterates masquerading as political leaders. A plague on all their houses.
Thanks TI fair warning; however the Greens are planning on changing the money system – it’s in their manifesto.
I’m pretty much of the same opinion as you TI. Interestingly enough your article prompted me to revisit the pound in your pocket speech by the then Labour PM some 48 years ago. So many changes have happened in the world since that speech, it’s almost unrecognisable as the place I inhabited as a child.
And yet having revisted it, I was struck by how much is the same. The burgeoning debt, trouble in the Middle East, cuts in defence spending, yada yada yada.
http://news.bbc.co.uk/onthisday/hi/dates/stories/november/19/newsid_3208000/3208396.stm
Enough with the reminiscing…!
I’ve been kinda impressed by the coalition tbh, especially after the grubby start they made with the smaller party gratuitously revelling in their role of kingmaker. Shame that so many of their supporters focus on the failings rather than the successes, not least the increase in personal allowances. Oh well that’s politics I guess and as any democratically elected Government knows, it’s not what you say, it’s the way you tell it.
Or was that “The Comedians”?
@Underscored
I know! I just think the other guys would have been worse!
I have a very low opinion of the financial sector. All of my idiot acquaintances went there and some truly talented ones who could have done some incredible research ending up doing work that is at best socially useless, and at worst downright damaging.
@Monevator
If only there was some sort of AV… Then I could show my leanings! In my mine the AV referendum was democracy at its worst. So much misinformation and lies-that-wouldn’t-count-as-such-in-court-but-really-are.
Oh and I think IHT is the best tax there is. I also like the idea of a land value tax – it seems far fairer than stamp duty and the effective poll tax we have from the councils, if rather hard to realise in practise. A mansion tax is a good start – it’s a bit pathetic that Miliband can’t even out argue a clueless pop star on such a reasonable policy.
Finally, remember that the people in charge don’t have anything like as much control over what happens as they think they do. I like to imagine a canal boat on a misty river with the tiller only very loosely connected. Perhaps they can guide things a little and even avoid/cause a collision even if they could see where they were going, and maybe they could smash a hole in the bottom if they were bad enough, but they’re not in control.
Anyway, I have so much more I could go on about, but I think I’ll go and read a nice fiction book instead.
@Greg – Labour didn’t actively keep us out of the Euro. TB wanted to run pell mell into the Euro. However, GB’s famous “tests” were really just a further manifestation of the antagonism between him and TB. Luck, and two men’s hatred for each other, not design, kept us out of the Euro.
@all re: Greens – the problem is that they want us to return to hairshirts and a medieval way of living. The vast majority don’t want that. “3-5 Green MPs in the mix to make a bit more noise”, especially if let loose in e.g. the DECC will simply result in England having the same energy crunch Scotland is about to experience that much sooner.
Figures vary depending on where you go, but look here for example:- http://www.bbc.co.uk/news/uk-scotland-28942576
Almost 60% of Scotland’s electricity comes from nuclear and coal. The two nukes will be offline within 8 years (taking over a third of capacity with them) and the coal stations are headed the same way. The Scottish government is ruling out any new nukes and I doubt any more coal stations will be built either. There is *no* way renewables will plug that gap, so within a decade, Scotland is facing a massive and severe energy crunch. Greens having any part in running the country would just be a recipe for accelerating disaster.
I’m with those above who say “A plague on all their houses”. None of them have a clue or, worse, do have a clue but not the backbone to do what needs to be done.
@eurohaters
I think you might find that the problem with the euro is that it’s strength has strangled the areas economic development (coupled with some national government policies)
If my pet theory is correct and “economic growth” is just a relay race of competitive devaluation we might find the laggards in the euro zone doing rather well in the next couple of years (Germany has been doing considerably better than us through out the decade, while being in the euro zone)
Most country’s problems in Europe are self inflicted by the refusal of democratic governments to take on vocal vested interests
@W de L
People consistently trot these examples out (which influence me not one jot) but note that I merely say “the likelihood ….. is sufficiently small”, nothing more categorical than that. I read all the spleen vented here with the same amusement that elections always engender in me, and it merely serves to confirm for me the personal aptness of my approach.
If voting were made compulsory here? Then it would depend on the sanction(s) imposed for not voting. If they were not personally tolerable then, spoiling my ballot paper being childish, I would use a process of elimination to decide which candidate to vote for, viz. male rather than female and then older rather than younger, with complete disregard for which party they might represent.
Happy voting!
I’m surprised more people aren’t more cynical regarding the motivations of politicians. There are a few decent back-benches trying to do the right thing but it’s almost a truism that the party leaders are just in it to feather their own nests an those of their favoured chums.
With a bit of luck we’ll break Belgium’s 2011 record of 589 days with no government. Stability at last!
Funnily enough I had an argument about Inheritance Tax the other day. In my view a blanket IHT is an unfair, non-progressive tax. However, I do also agree with your point about people who inherit money essentially benefiting off all the tax breaks that someone else had all their life – no CGT on primary home, ISA/pension tax breaks, etc.
The culmination of the argument seemed to be that if IHT is a fair way of reclaiming those tax breaks, then you should have to pay IHT when you give away money while you’re alive, let alone when you die. That people can plan for their death by ensuring they’ve given away enough of their estate at least 7 years before they die is a rather big loophole. On that basis, who is IHT really targeting at present – those who should pay their fair share, or those who simply didn’t have the knowledge / inclination to think about all this stuff?
I’ll stay away from backing particular parties here, although I have frittered between parties in the past as well.
“Rather, they are much more likely to vote based on the outlook for their own wallets.” Couldn’t agree more. I think this is how the majority of people vote, which I can’t decide if it’s sad or to be expected. There waas an article a little while ago in the Telegraph featuring a Cheryl Cole who, despite being a “life long labour” supporter, was thinking of moving towards to Tories to reduce her personal tax bill. Nothing like a bit of self interest eh?
Will need to read article a couple more times, but a superb read 🙂
Mr Z
For what it’s worth, I think there’s merit in scrapping IHT totally but treating gifts/inheritances as earned income to be taxed accordingly at the recipient’s marginal rate.
And CGT without indexation is pure theft.
@Edgeofcultivation
All taxation is theft, governments get to pick winners and losers
Personally I would damn sight rather see capital taxed a good deal more in this country and income taxed less
As it stands today you can work for ten years earning £100k a year and pay £290k of taxes
Inherit £1m and you will pay only £180k in taxes
Its not surprising we have ended up with a hugely widened generational and regional disparity of wealth in the country as a result
The election is simply three choices
– do we want to do nothing and preserve the status quo (conservatives)
– try to change things in the environment of the current system (labour)
– blow-up the system (UKIP in England, SNP in Scotland)
Right to buy is complete madness – supposedly George Osborne was against and it was only adopted at the last minute because the campaign was going badly.
Its a subsidy of 72 grand from the tax payer to people who already live in secure, decent housing at below market rates. So they can pursue the dream of ‘buying a house’! Why not just offer round the world crusie’s to all those in marginal seats? Would probably be cheaper.
Think you are overdoing Labour’s lurch to the left: 50p for over 150 grand is par for the course for developed countries; the mansion tax makes perfect sense: property owners have benefited enormously through governemnt policies to boost demand and inhibit supply; it must be equitable for a very small amount of that wealth to be used for the health service.
I understand your perspective on inheritance tax, but, if I may, I think Cameron has this correctly in describing it as a matter of basic human instinct. Most parents want to leave their children whatever is left at their demise and it seems to me pretty close to a breach of their natural rights for the State to try to take a chunk out of that. If there is a factor behind continuing inequality in the country, I suspect it lies in the demise of the grammar school/leftwing unwillingness to stream pupils.
I couldn’t agree more. I thought that the tories were a least the least dangerous of the lot, until their recent schemes to push house prices even higher. London is now totally unaffordable to people on ordinary salaries and the probability that this will end very badly has just increased substantially. This is irresponsibility on an epic scale – personally I would expect that kind of stuff from Labour or the minority weirdos but if the tories don’t get it either we are seriously in trouble.
My reaction to the announcement of the IHT policy and social housing sell off was similar- making me revisit my current intention to vote tory.
It horrifies me that there seems to be such a lack of joined up thinking in running after potential votes. In a country where shortage and arguable misallocation of social housing has led to the reviled “bedroom tax” being imposed on the poorest, planning to sell off other social housing properties at a huge discount to lucky occupiers who presumably have enough funds or earning capacity to raise a mortgage for the balance seems loony . And there are enough pensioners rattling around in houses too big for them (and often too expensive) without giving them another incentive not to sell up and downsize.
I’d prefer, if we must limit pension tax relief for high earners, to see the proceeds used to increase house building
@Vincent Even with these ill judged pre election bribes the tories are probably still the least dangerous- it is just tragic that the range of choices is so poor!
@Neverland,
You mention inter-generational disparity. This is a huge issue especially for those under 40 who don’t have recourse to the bank of mum and dad.
The young will eventually realise that they are getting a very poor deal and get very angry. Old people vote. Young people riot.
None of the political parties are addressing this issue. This will end very badly.
Off the top of my head we pay personal taxes:
Income tax at 0% / 20% / 40% / 45% / 60% (effective)
National Insurance at 0% / 13.8% / 2%
VAT at 0% / 5% / 20%
Fuel duty, alcohol duty, tobacco duty, insurance duty, air passenger duty, etc
Capital gains tax at 0% / 18% / 28%
Inheritance tax at 0% to 40%
Council Tax at £0 – £3,400 p.a.
Etc.
And yet, as a country, we still cannot live within our means.
The Victorians had a concept of the “deserving poor”. Something similar comes to my mind.
As a society we all (and especially the wealthy) should have no qualms about paying for (excellent) healthcare for the ill, (excellent) social care for the elderly, (excellent) education for the young and (excellent) defence for the realm.
But we should draw a line at funding those who won’t, rather than those who can’t.
The smearing of vast sums of money across both the deserving and the undeserving means that no-one gets an excellent outcome. We should be much more generous to the deserving and much harder on the undeserving. And, as a country, we should live within our means. Of course everyone defines “deserving” and “undeserving” differently…hence difficult choices are swerved. I see nothing changing with this election.
…not forgetting car tax and TV licence! 🙂
@Grumpyoldpaul
The young did riot in 2010 and 2011
You might remember conservative central office in Millbank being pillaged and Prince Charles being heckled by student protesters in the west end
They were filmed on CCTV and by specialist police teams
Many were latter rounded up and some jailed, so they now have criminal records that will follow them the rest of their lives
The police then went out and bought some second hand water cannon trucks in case it happened again
This isn’t the 60s
Couldn’t agree more with your analysis. Have no idea who to vote for ..
If you stop being a mysterious financial blogger, then a career writing would suit your excellent prose…..
A scenario for you…
• You wish to buy a computer, say for £1000
• To get that money the company has to pay you
o £1000 + Employers NI + Employees NI (say 20%)
• You get the £1000 and pay income tax on it between 20-60% depending on your tax bracket.
• The computer also has VAT added – £200
• So far, I reckon for you to buy a £1000 computer, the government already gets £600 to £1000 in taxes.
Tax between 60% and 100%.
Then the company who sold it to you pays corporation tax on the profit, if they are making a profit at all.
Obviously this is not enough.
Its all well and good saying we should pay our “fair share” of taxes, including taxing something we already paid taxes on. My point is it will never be enough.
So far the “Austerity” program has doubled the national debt!
Your anaylsis of Investing preaches, minimise costs, low cost trackers.
The Governments version of cutting costs is more like a mega Hedge Fund Called “B*stard, B*stard, McKight & B*stard” compared to Vanguard.
Kind Regards, love the blog…
@Richard – I have pinned up on my wall the IFS breakdown of our national revenues:-
Page 5 of this – http://www.ifs.org.uk/bns/bn09.pdf
Of the £648bn taxes, the big 3 make up 60%
– Income tax
– National Insurance
– VAT
and tier 2 takes that total upto 84%
– Fuel, Booze n Fags duty
– Corporation tax
– Business rates, Council Tax
– Stamp duty
Inheritance tax raises 3.9bn (0.6%) — about the same as 3 days of work taxes. Why bother even collecting it at all?
Most taxation is focussed on working and spending (Odd as you might imagine that these are things to be encouraged rather than dissuaded). Dedicated followers of the Moustachioed one therefore do doubly well dodging taxes by not working and again by not spending. There’s a reason his theory adds up.
The sense you get is how complicated the whole shebang is. And it has to be, as the country has to be squeezed really hard in every area to try to get the numbers to add up. It’s a bit like me trying to do my belt up after a really big Christmas lunch — every few millimetres makes a difference.
The only real answer is to reign in on the expenditure — just a a little — and simply the whole lot. I like having a safety net, and a jolly decent one at that, but I can’t help wondering if ours is a little gold-plated. It’s a real eye-opener when you look at where the expenditure lies.
FWIW, I really like the idea that minimum wage is linked to the personal allowance. It sets up a trade-off for Government when considering moving one or the other. Ideally at 40 hours, but 30 is a start. It also (ideally) means that taxation doesn’t act as a brake on working instead of living on benefits. I think it’s nuts that the NI threshold is set so low compared with the personal allowance.
@TI – a touch of prejudice coming out there against Home County accents? I got mine in the West Country, and my experience of the tech scene is that it is creating opportunities and mobility for people to do things their parents’ generation wouldn’t have been able to do. Although it is true that entrepreneurship is well-suited for both the desperate and the secure.
Can I just say that I think the level of the content (both the posts themselves and the comments) on this site make it one of my favourite sites on the internet. Thanks all for your part in make it so.
Good piece TI! Agree with most of your opinions.
Quite like the 1m IHT wrt residential property idea in general though don’t agree with a blanket £1m threshold for all across the country because the x-millionaires will benefit disproportionately. Think lifting IHT threshold on PRIMARY homes is a good idea though. Perhaps it could be linked to the council tax bands in some form of ratio.
Didn’t one of the majors talk about 150% Council Tax on non-primary residential properties? Think it was Labour though it could be Miliband’s off-the-cuff policies that often gets dropped along the highways.
All 3 main parties have a few reasonable ideas & wouldn’t it be great if in the 1st year we could force the parliament to at least evaluate some of these.
Like you for the first time, I am struggling to decide. I am most likely going to lodge my vote with the Cons because the thought of two Eds sends shivers down my spine. Both of them freak me out for different reasons. Plus, both being Brown’s protégé however they dress things up doesn’t help matters 😉
@Mathmo — Ha, not at all, I’m a sucker for a posh South of England accent, and still deeply miss the way a particular ex- of mine muttered sweet nothings (/the shopping list) in an accent that wouldn’t have been out of place on the BBC Home Service in the 1950s.
However it is a bit of an obvious ‘tell’ as to where someone hails from, or at least where they were educated (which if they are different is just as telling from a social mobility perspective).
I disagree about the tech scene, personally. It might be true for small projects, but not for the big dial-moving picture.
A most surprising thing to me in fact is how important geographic clusters are in an interconnected world. That’s why Google is opening its new campus next to Kings Cross in one of the most expensive parts of London, and why for that matter the new Crick pharma facility is next door too.
It’s why US tech entrepreneurs and the top talent still flocsk en masse to California.
For now, geography really matters, and those from less wealthy backgrounds are getting priced out.
I’m starting to think another coalition, any combination, might be the best way of avoiding the worst of the mad bribes ..
I think electoral reform is impossible unless one of the major parties backs it. This happened in New Zealand in the not so distant past – it is not impossible. 84% voted to replace FPP with a proportional system.
http://en.wikipedia.org/wiki/Electoral_reform_in_New_Zealand#Parliamentary_electoral_reform
We’ve seen what happens when the issue is sprung on voters and the process subverted by the two main parties.
I’ll be “wasting” my vote on a minor party candidate, again.
Great blog as usual – thanks!
I am a floating voter and housing is a big concern.
I was tempted by the Tory IHT offer as (having arrived with a rucsack from the provinces 18 years ago) I bought a property in a crap part of London in 2000, since which time property prices have doubled twice. Despite living in one of the most deprived boroughs in the country we will at some point face a big IHT bill (just by the lottery of where we chose to live) which will swipe the equity which might have given our kids a chance of buying where they grew up. (Prices went up here 24% in 2014 alone so any tips on low cost tracker investments that can keep pace with this would be gratefully received!) Anyway there are lots of people in London in our position and the IHT offer will tempt many while costing very little as the above comments show.
However my interest in the Tories was shortlived and I feel physically sick about the idea of the right to buy scheme extension. I think it is right and fair that deserving people get help via subsidised rent, but I can’t stomach scant public resources being given away at below market value.
None of the parties are proposing anything sensible about housing and they all seem to want to keep the housing bubble stoked to get more money “printed”. Everyone keeps trotting out the nonsense that housebuilding will somehow bring prices down/stablise things ….. er no! Housebuilders have enough sites and planning permissions for all the houses that we need already banked (without needing green belt) and they could fix this issue at a stroke. Unfortunately they drip feed property into the market to ensure that it does not depress prices. The politicians promises to build more private housing seem meaningless to me as a result.
With the Bank of England referencing CPI (rather than RPI) they can ignore the land value inflation and keep interest rates low to keep the bubble up. I am sad that none of the parties have mentioned gently raising the interest rates to cool things off gently. The news this week that prices are falling relate to the end of 2014 and early 2015 when people thoughts the rates would rise imminently. Now that the rates are likely to stay low for 18-24 months the housing market has picked up again (locally a one bed flat went under offer at 17% over asking price with 22 offers on over 60 viewings) so things are set to go crazy again this year. Sigh. Massive price hikes are not good for any of us …..
“That’s why Google is opening its new campus next to Kings Cross in one of the most expensive parts of London, and why for that matter the new Crick pharma facility is next door too.” I see – to give them good access to Cambridge.
It seems to me that Capitalism is not yet a proven system to cater for the needs of an ever expanding society in a Global economy. Good has it has been in the past the future may be a very different story.
If we cannot get the super rich to pay more tax and the rest take flight with assets and funds then it will be the PAYE that will have to pay the costs.
We can only expect the bubble to break with anachy, ‘war’ or reduced asset values
Well the riots in 2009 gave us a taste of anarchy, although our borough at the time didn’t have a wealthy upper end (at that time) to have created much irritation amongst the poor. It was pretty scary how easy it all bubbled up though….
@gally my understanding of how the numbers actually breakdown suggests that not only do the super rich pay taxes; they pay pretty much all of the taxes and the rest of us get a free ride on their coat-tails with some glorious services that we take for granted and don’t have the decency to say thank-you.
The only thing that amazes me is how the party of the grasping ingrates gets known as the caring nice lot and the others who threw this wonderful party are nasty, apparently
@Mathmo — Well put. (Well, I wouldn’t say ‘grasping ingrates’, I definitely don’t think wealth distribution and redistribution is all down to that. But I do believe some party should stand up and point out how much the richer half pays.)
Wheres the talk about growing the economy?
Was it just me or did I miss any talk of increasing innovation, manufacturing, business etc. The whole election debate revolved around which party would spend the most taxpayers money?
Surely this is the whole point of an economy to to be productive?
Why do the richer half live here and not go to a low tax country like Somalia then? Oh, I see the state infrastructure, stability and workforce (funded by taxes!) are not there to provide them with opportunity!
Money is a claim on wealth, not actual wealth, take a suitcase with $1 mill in it to a desert island and tell me how rich you are.
@TI – Possibly an over-statement, I agree. I’m often a little tetchy before the staff have brought me my morning coffee and ironed my morning blog-reading. 😉
@TI But I do believe some party should stand up and point out how much the richer half pays
It’s not exactly a state secret – it’s called progressive taxation.
@Mathmo “not only do the super rich pay taxes; they pay pretty much all of the taxes and the rest of us get a free ride on their coat-tails with some glorious services that we take for granted and don’t have the decency to say thank-you.”
In a completely meritocratic world where everyone’s wealth was solely the reward for talent and hard work, bankers weren’t paid millions for destroying the economy, nobody passed anything on to their children, and the children of the poor were not punished for their parents’ alleged failings, this might just make some sense.
Meanwhile, on planet earth…
@tim g – you’ve looked at what I’ve said with a filter of morality. The morality you’ve chosen is that your idea of meritocracy (talent, work) should derermine wealth. I suppose if we’re looking to impose moral judgements on things then that might be a very common one. However, I suppose that I am skeptical of the ability of society to both measure ‘talent’ and ‘work’ and to redistribute fairly. The poor usually get screwed just by a different group.
If I were to apply a moral filter to this, I’d probably start from the concept of the ability to own property being a good thing. The moment you start saying that someone’s property is ‘ill-deserved’ and should be taken away, you embark on a very slippery slope and you’d better be sure that you know very clearly that you and all you successors in power have a very clear definition of ‘ill-deserved’. I do what I do because I believe the resulting benefit will accrue to me no matter how well I do. I couldn’t do that in a society where the aim is to create equality by chopping everyone down to the same level. I am very relaxed that some people will be much richer tgan me.
@Mathmo “you’ve looked at what I’ve said with a filter of morality”
Of course. I don’t think there’s any way of avoiding morality here. Unconditionally endorsing the current distribution of wealth or seeking to temper it with some redistributive measures are both moral positions.
In the Labour manifesto it also says they are planning to “bear down on disguised employment”, which I presume means new taxes for freelancers operating through a limited company. If IR35 is expanded and pension relief is taken away from higher rate PAYE taxpayers then it becomes hard to see how one can save for retirement in a tax efficient manner.
Speaking as one of your Scottish readers, your one line dismissals of the parties heavily skewed towards representing Welsh and Scottish national interests at Westminster are disappointing and unhelpful.
It’s comments like that which will probably lead to the nationalist bogeyman getting far more votes than they might have without all the scaremongering from the political establishment (the English political establishment, the SNP are the establishment in Scotland).
I prefer it when you talk about investing :p
Your reference to UKIP: ‘…but the party itself is clearly populated by rank-and-file nutters…’
There’s no logic in sweeping statements like that, and it does you no credit. You don’t see those bringing disrepute to the party being quickly ousted as a good thing? And clearly decisive moves not matched by the other parties?
Is the sovereignty of these islands, the identity of its people, not important? Who genuinely wants to put the interests of these islands first, by listening to the populace? None of the other parties mention natural and inalienable rights, the first duty of government, charity starting at home, the unelected EU dictatorial autocracy costing this nation billions et. al. It seems the rest are content to have us subsumed in a left wing liberal pinko PC all-inclusive multi-cultural ideology and annihilate our identity.
If you’re going to dismiss UKIP in such a cavalier manner, at least produce some evidence and show that what they stand for is wrong – and why – in the interests of this nation.
Apart from that, I’ve learned a great deal regarding financial matters from this informative site. Keep it up.
Cheers
Thanks for the soap box, every 5 years
I have now come to the conclusion that Politicians and Politics are not for the retired. We have seen all this before and its not relevant anymore.
Why do we have a system of adversarial politics? Can they never agree.
Why do we have system where the majority of votes count for nothing as electoral boundaries dictate the outcome. Can we please redraw the boundaries so that we all live in a marginal seat.
Why is it that we always have a party elected that has less votes cast for it than the other?
Our two party voting system and first past the post is not fit for ‘Modern’ devolved Britain. We need a new constitution and a fresh look at how we all work together if not in harmony but with tolerance.
Perhaps if our parties discussed how we could change the system for the better instead of protecting their fiefdoms and status quo we might be more interested in engaging with them.
In the meantime my vote and anything I think or say will count for nothing by my local MP or his party, its a safe seat, which probably applies to many sections of society in Britain today.
A very good read. I didn’t expect to read it to the end.
Two of many points being thrown around in recent months are immigration and housing. It makes it sound almost like all of the UK’s new immigrants are buying up all the property.
That’s not the case. Property owners are buying up additional homes using the equity in their other properties to act as a 40%+ deposit. Then renting out the new properties in their portfolios.
Once a few EU countries start growing their economies again, then interest rates will rise, mortgage payments will be higher than their rental incomes and more housing stock will appear, hopefully with a downward value occurring on property prices.
And hopefully that will be the end of a barrage of TV programmes showing people how to make money from buying and renting properties.
@gally “Why do we have system where the majority of votes count for nothing as electoral boundaries dictate the outcome.” ……… Completely agree; a real soar point with me that my vote counts for nothing; its a complete waste of time but I always live in hope & vote!!
In our borough, all other parties including Conservative have been decimated at the last election. We have 90-95% Labour Councillors and a Labour MP who has held the seat for 20+yrs. Locally, the whole system is so dictatorial and so desperately hoping for a non-Labour MP. Got to a point where anyone will do as long as he/she is not Labour.
“…. how we could change the system for the better instead of protecting their fiefdoms”. Days of conviction politics are well & truly gone – desperately hanging on to POWER & fiefdoms will rule and in a so called democracy there is nothing we can do about it. (& yes I know that we are better off than most other countries BUT that does not make it right.)
“As I say, I know most of you don’t agree with me”
On the contrary, I believe one of the most sensible ways to extract tax, given that tax must be collected somehow, is to tax inheritances highly. This allows lower tax on currently productive members of society, rather than allowing wealth to flow untaxed down the generations.
I also suspect that there are more supporters of this idea out there than is immediately apparent. They simply don’t shout as loudly.
I am personally in the position of being able to leave a sizeable amount to my heirs, however I don’t believe they deserve it. They should have to go out and earn it themselves, just as I have done.
@Peter couldn’t agree more.
As I forecast, @Topman April 16, my not voting made no difference to the total result, even in the usually marginal (Tory/Lib Dem) constituency in which I live. Truth to tell, my unblemished prediction record in this regard stretches back to the 1960s and in various different constituencies during that time, surely unrivalled by any pollster!! ~:-)