Welfare dominates Osborne's speech
Peter Hoskin 1:34pm
George Osborne delivered everything we expected, and then some. This was a confident and
wide-ranging speech from a Chancellor who has suddenly discovered a central message: what's right about burning £120 million of taxpayers' cash in debt interest payments every day? Wouldn't
it be better to get to grips with that waste as soon as possible? And that message percolated down through everything from his attack on Ed Miliband to his case for reforming our public services.
"It's like a credit card," Osborne growled, "the longer you leave it, the worse it gets."
But if that was the theme of Osborne's symphony, then the motif was certainly welfare. Huge chunks of this speech could have been delivered by Iain Duncan Smith, and probably will be when he addresses conference tomorrow. There was an emphasis on "making work pay," and on the "biggest reform of the welfare system since William Beveridge." But there were also some specifics: the child benefit cut, of course, and also the announcement of a new benefits cap. According to Osborne, that cap will mean that no family will earn more on benefits than the average family would by working.
Like Osborne's inheritance tax cut, this benefit cap is probably more about politics than public finances. It will be set around £500 a week and, according to the numbers being put around by his team, will affect only 50,000 families, if not fewer. For some, apparently, that could mean losses of £300 a week – but I imagine the majority of savings will be far more modest than that. Yet the political statement is huge. This measure says, far more clearly than any discussion of marginal tax rates ever could, that the benefits trap is being sprung. And I imagine it will go down well with any taxpayers who feel that the current set-up is unfair on their wallets.
Questions on detail aside, I'd say that this was mission accomplished for Osborne. A pre-Spending Review speech was never going to be a thing of beauty and light. But this was strong enough, resonant enough, to keep the public on board for now.
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sinosimon
October 4th, 2010 2:09pm Report this commentbenefit should be no more than you would receive AFTER tax working on minimum wage(unless medical circumstances require otherwise). simple as that.
jay mason
October 4th, 2010 2:11pm Report this comment£500 a week for sitting about doing nothing, still seems far too high to me. Personally I feel it should be £250 max and that it should be paid in vouchers so that benefit does not sponsor Bargain Booze and the local bookies.
Alan Edwards
October 4th, 2010 2:11pm Report this commentThank God we have a real Government no longer living in the land of financial fantasy!
whatawaste
October 4th, 2010 2:24pm Report this commentThe cap at £500 a week makes sense but does it include housing benefit? If so those living in affluent areas where rents are high and council tax provision heavily oversubscribed, will have have to move geographically.
With all the equality, human rights legislation etc can this be enforced. Personally I believe in living within your means yet for those who know how to twaek the creaking and not fit for purpose "system" the state currently pays over generously.
The other problem is that local councils administer housing benefit - will they all play ball?
Verity
October 4th, 2010 3:02pm Report this commentWhat's the difference between a "theme" and a "motif", Pete?
Re welfare, I knew they wouldn't be bold enough, but free money to slags, layabouts and immigrants, legal or otherwise, should be axed. Do you think I could apply for unemployument in Mexico? Singapore? Malaysia? They would have you hustled out of the country before you could say, "Window seat, please."
And the money that is paid to the Exchequer by people in employment should be converted to food stamps and hygiene tokens for distribution to LEGITIMATE welfare claimants. Immigrants, unless citizens, should be shipped back to wherever. That means the taxpayer would be liable for their plane fare and that would be the end of it. Once they're back in their own country, they can apply to their own governmenet for assistanbce. This would also have a deterrent effect.
Pete Hoskin
October 4th, 2010 3:14pm Report this commentVerity: Wikipedia actually has a good explanation of the difference between theme and motif here:
http://is.gd/fKegI
And here:
http://is.gd/fKemL
But the basic point is that a theme is the "material, usually a recognisable melody, upon which part or all of a composition is based." And the motif is "a short musical idea, a salient recurring figure, musical fragment or succession of notes that has some special importance in or is characteristic of a composition … it is commonly regarded as the shortest subdivision of a theme."
My thinking was that the "we need to pay off our debt now" message was the core of Osborne's speech. The welfare reform bits were its most important subdivision.
David Bouvier
October 4th, 2010 3:23pm Report this commentThe cap is a brilliant policy initiative, in that that it is:
1) Almost impossible to be against .
2) Deals with manifest unfairness in the current system
3) Leads towards a more integrated system
Of course - Jay Mason - £500/week is a lot to get for free but this is the upper limit, not the standard.
Some care needs to given to defining the reference household income - a dual income, average income couple would make £50k.
ajs
October 4th, 2010 3:27pm Report this commentIt will be a good tag on whoever the Miliband chooses as shadow Chancellor - "the credit card shadow Chancellor".
Tiberius
October 4th, 2010 4:19pm Report this commentPete: you shouldn't waste your time with The Lady of Truth.
Holly ......
October 4th, 2010 5:04pm Report this commentOsborne is brilliant.
While he was telling the banks.."Without investment,there is NO growth".
In english..start lending & go easy on the bonuses.
Spelling out how the economy is going to be handled..he was telling businesses...Britain
is a good place to invest.The good old BBC
wheeled out Coop, On her Shadow Chancellor job interview.
The usual dismal,scaremongering lines came out.
All those families with disabled children.
Interviewer pointed out these would be excluded.
Beetroot is a good discription.She was terrible,so Labour pushed Liam Byrne out to
face the camera...Yup,the same Byrne who left the treasury and let it be known
'there is no money left'.
So,to recap Ed's choices for shadow chancellor to date...Balls,Coop & Byrne
That must fill businesses and 'the city'with
confidence eh?
We are now getting a better picture of the direction they intend to take this country and it seems a much better,economically safer direction from where Labour would take us.
Verity
October 4th, 2010 5:39pm Report this commentPete, oh, OK. I don't agree and if the only justification you can find is in Wickipedia, well, what can I say? But OK, I'll drop it.
Verity
October 4th, 2010 5:45pm Report this commentPete, oh, OK. I don't agree and if the only justification you can find is in Wickipedia, well, what can I say? But OK, I'll drop it.
Noa Zrk
October 5th, 2010 11:31pm Report this comment"Yet the political statement is huge".
It would be even greater if such payments were to be made only on the basis of a limit based on contributions made by the recipient, after which support moved to a food and essential needs voucher programme.
Even better if
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