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Q5/ How do the Liberal Democrats find all the money for the tax reform and injection of billions extra into education when all the Conservatives seem to be offering are cuts? Where is all the money coming from? If we are to be able to deliver the radical changes proposed in this manifesto as well as restoring the health of the public finances, we must be honest with people about how these policies will be paid for. That is why we have set out here how our tax package will be funded, where we intend to increase spending and where we plan to make savings. The savings we have identified far outweigh the amount of spending we are proposing, and it is these savings which will be used to start to reduce the deficit. All the savings we have identified are either instead of or additional to proposals the Government has already made. It is our working assumption that we will start to reduce the deficit from 2011–12 onwards. The savings identified below are only the start of a programme to tackle the deficit and in government we will go further, holding a comprehensive review of all government spending, on which we will consult fully with the public. This will identify the remaining savings which will need to be made to balance the government’s books. This comprehensive review will not reverse or undermine any of the spending commitments we make in this manifesto. Over and above our planned new levy on the profits of banks, we will seek to eliminate the deficit through spending cuts. If, in order to protect fairness, sufficient cuts could not be found, tax rises would be a last resort. While it will be impossible to remove the Government’s tax rises while the deficit is so huge, the increase in National Insurance Contributions is a damaging tax on jobs and an unfair tax on employees, so when resources allow we would seek to reverse it. Following the election of a Liberal Democrat Government, an emergency budget and interim spending review would be held by no later than the end of June 2010. This budget and spending review would have four purposes:
We will establish a Council on Financial Stability, involving representatives of all parties, the Governor of the Bank of England, and the Chair of the Financial Services Authority. This group would agree the timeframe and scale of a deficit reduction plan to set the framework (though not the detail) for the Comprehensive Spending Review and seek to promote it externally and domestically. Any such agreement would be without prejudice to parties retaining and advocating distinctive views on a wide range of issues, such as fair taxes and spending priorities. Throughout the summer and early autumn a Comprehensive Spending Review of all departments would be conducted with the objective of identifying the remaining cuts needed to, at a minimum, halve the deficit by 2013–14. A Strategic Security and Defence Review would form part of this spending review, working within the same financial and time constraints. This review will focus particularly on savings that can be made across government – such as on pay, public sector pensions, and IT provision – and on low-priority spending. It will not reverse or undermine any of the spending commitments that we make in this manifesto. In education, that means that additional funding for schools through the Pupil Premium will continue to be delivered throughout the next Parliament. Instead of ring-fencing education, we are doing better than that by bringing in new money to fund the Pupil Premium. In health, our first priority will continue to be to increase spending in some parts of the NHS by cutting waste in others. We do not plan to make net cuts in spending on front-line health services. The cross-government economies needed to reduce the deficit such as on pay, pensions, and IT procurement will affect all departments, so it would simply be dishonest to say that entire departmental budget can be ring-fenced from cuts. For example, it is only because we refuse to ring-fence departments from the search for savings that we have been able to identify the funds for the Pupil Premium and to protect frontline health services. The results of this spending review would be widely consulted on with the public sector and general public throughout the end of 2010 and beginning of 2011. Based on this consultation a full spending review up to 2013–14 would be published alongside the 2011 Budget. Tax proposals: £m in projected 2011–12 prices (All figures have been rounded to the nearest £5m) Costs of proposals 1 Raise the personal allowance to £10,000 per person 16,795 __________________________________________________________________ Total cost 16,795 __________________________________________________________________ Revenue generated from proposals A: Closing tax loopholes and cutting reliefs that benefit the wealthiest 2 Reform capital gains tax 1,920 3 Restrict pension tax relief to the basic rate 5,455 4 A 1 per cent levy on the value of properties over £2m 1,710 B: Green taxation 5 Switching from Air Passenger Duty to a per-plane duty 3,060 6 A higher per-mile duty charge for non-lifeline domestic flights 255 C: Anti-avoidance measures 7 Income tax and National Insurance Contributions 2,415 8 Corporation tax 1,460 9 Stamp duty 750 _________________________________________________________________ Total savings 17,025 Contingency fund 230 _________________________________________________________________ Note: Tables may not sum exactly due to rounding Spending proposals: £m (in predicted nominal terms). (1) 2010–11 2011–12 2012–13 2013–14 2014–15 Spending commitments 1 Jobs and infrastructure package including (2): 1a Eco cash-back scheme 335 0 0 0 0 1b Investing in wind energy and other renewables 420 0 0 0 0 1c Insulating public buildings 400 0 0 0 0 1d Bringing empty homes back into use 1,165 0 0 0 0 1e Tackling youth unemployment 660 95 0 0 0 1f Bus scrappage scheme 140 0 0 0 0 2 Cut class sizes – introducing a pupil premium (3) 0 2,500 2,540 2,590 2,640 3 Scrapping tuition fees3 600 685 740 1,570 1,765 4 Restore the pension earnings link 0 0 320 325 330 5 Recruit 3,000 more police officers(4) 5 50 95 140 185 6 A pay rise and better homes for our troops 0 420 425 430 440 ________________________________________________________________________________________________ Total spending 3,730 3,745 4,115 5,050 5,360 ________________________________________________________________________________________________ Savings proposals: £m (in predicted nominal terms) (1) 2010–11 2011–12 2012–13 2013–14 2014–15 Helping people fairly 7 Reform tax credits 640 1,305 1,300 1,310 1,315 8 Reform winter fuel payments 300 145 60 -15 -70 9 Scale back the Homebuy programme 250 255 260 265 270 10 Refocus Train to Gain 325 335 340 345 350 11 End government contributions to the Child Trust Fund 395 545 555 565 580 12 Introduce a levy on bank profits 2,005 2,205 2,430 2,670 2,940 13 Cut Ministry of Defence administration and top brass 0 205 420 440 460 14 Cut the economic costs of mental health problems 0 425 500 575 605 through better treatment 15 A cash limit on public sector pay rises of £400 for 2 years (5) 0 1,705 3,460 3,525 3,600 Decentralising government 16 Abolish the Government Offices for the Regions 0 90 90 90 95 17 Reform Regional Development Agencies 0 600 610 620 635 18 Cut bureaucracy of local government inspection 0 860 870 890 905 19 End top-down education initiatives 0 335 340 350 355 Creating a freer society 20 Scrap ID cards 50 80 110 155 155 21 Scrap biometric passports 220 405 425 400 380 22 Scrap Intercept Modernisation Programme 0 200 200 200 200 23 Abolish ContactPoint 0 45 45 50 50 24 Maintain the current school leaving age 0 0 35 35 70 Creating a more cost-effective government 25 Commercialise UK Trade and Investment 0 135 135 140 140 26 Scrap Euro-fighter tranche 3B 0 0 510 510 510 27 Cut education quangos and administration 0 415 410 420 430 28 Prison reform 0 795 735 675 845 29 Scrap civil service bonuses 0 155 155 160 160 30 Cut use of consultants in the public sector 0 180 180 185 190 31 Cut quangos across government 0 225 225 230 235 32 Cut the costs of politics 0 610 620 635 645 Net increase in devolved administration budgets (6) 33 The Scottish Parliament (7) 240 -120 -120 -30 -25 34 The National Assembly for Wales 140 -15 -15 30 40 35 The Northern Ireland Assembly 80 -50 -45 -15 -15 _________________________________________________________________________________________________ Total savings 3,730 12,430 15,205 15,435 16,050 _________________________________________________________________________________________________ Net increase in public sector spending 0 -8,680 -11,090 -10,385 -10,685 _________________________________________________________________________________________________ Notes: Totals may not sum due to rounding. 1 All figures have been rounded to the nearest £5m 2 The jobs package with the exception of parts 1c and 1e is for England only. Barnett consequences for the remainder are accounted for in lines 33 to 35 3 Costs are for England, Barnett consequences for the devolved administrations are accounted for in lines 33 to 35 4 Costs are for England and Wales only, Barnett consquences for Scotland and Northern Ireland are accounted for in lines 33 and 35 5 This proposal is an alternative to the Government’s proposal to cap public sector pay at 1% 6 Scottish and Welsh Liberal Democrats have set out their own budget plans for Scotland and Wales 7 As set out in this manifesto, a Liberal Democrat Government would resolve the disputes and anomalies between the UK and Scottish Governments over the Registers of Scotland and the Scottish element of the Fossil Fuel Levy, with the consequence of adding up to £250m to the resources controlled by the Scottish Government in 2011–12. Q4/ What does the IFS (Institute of Fiscal Studies) say? "The Liberal Democrats have been the most honest about spelling out their spending cuts." The IFS have estimated that the parties have spelt out their spending cuts: -
"Beyond the Banking Levy, the Liberal Democrats would not need to increase taxes." "The Liberal Democrat spending package adds up. The IFS are confident that LibDem tax proposals would cost £17bn, and although less certain about revenue raising measures, there is no overall bias: Some measures look likely to raise more than they expect, some less." The IFS has made it clear that LibDem tax policy will give greater incentives to work than the Conservatives NI proposals. They have also pointed out that LibDem tax & benefit proposals as a whole make the LibDem tax system fairer. And: "The Liberal Democrat proposals would offer much needed simplifications to the tax system and remove distortions, such as through CGT and aviation tax proposals." Q3/ Flexible Parental Leave The policy in brief We will allow parents to share 12 months of parental leave between them in whatever way suits them best. Over time we aim to extend this to 19 months. Why it is necessary When a baby is born, the mother gets a year’s leave and the father currently gets just two weeks. That’s unfair: it means the mother has to take the lion’s share of responsibility, even if she and her partner would rather share things equally. This country lags behind other countries when it comes to supporting parents to spend meaningful time with their newborn baby. This Government’s approach has always been inflexible – forcing parents to fit their lives around what the Government wants, when it should be the other way around. The idea that it’s always the mother who takes on the lion’s share of childcare is long outdated. Many fathers are desperate to spend more time with their child, but just unable to do so. Policy detail We will replace the current unfair arrangements with new entitlement to 12 months of parental leave, which can be shared between parents, in whatever way suits them best. Mothers will have to take two weeks’ leave following the birth of their child – as is the case at the moment, but the remainder of the 12 months will be completely flexible. Mothers will continue to be entitled to 90% of their salary for the first six weeks. Fathers will also be able to take their existing 2 weeks of paternity leave from the day the baby is born (and receive paternity pay of £123 p/w) i.Either parent will then be entitled to the current Statutory Maternity/Paternity rate of £123 for the remaining 33 weeks. The rest of the 12 months will be unpaid, like now ii. If they wish to, parents could take their leave together e.g. up to six months with neither parent working. Same-sex parents will also be able to share leave in this way.Our longer term ambition is to extend shared parental leave to 19 months. Together with our long term plan to begin universal childcare provision at the age of 18 months, this would provide seamless support for parents, closing the two-year gap between the end of maternity leave and the beginning of universal childcare support. When we extend parental leave to 19 months, six months of each parent’s entitlement will not be transferable: couples will only get 19 months if each takes at least six months’ leave. This will encourage shared parenting and reduce the burden on business of long parental leave. Single parents, however, will be eligible for the full 19 months. Costs/Savings Cost neutral – we are just making the existing arrangements flexible. The extension of leave to 19 months will only be introduced as resources allow. Labour They say: Introduced paid paternity leave (2 weeks) and now plan to allow fathers to take six months of leave once a child is six months old and if their child’s mother returns to workiii.We say: They fail to understand that all families are different and need far more flexibility when it comes to parental leave. Labour seems to think it knows best when it comes to how families should arrange their lives.Conservatives They say: They’ll introduce flexible parental leave.We say: They can’t be trusted, as they haven’t spelt out the detail of what this will mean. David Cameron voted against the introduction of paid paternity leave and he even said that plans to extend it owed more to “political correctness than the realities of life”.ivKey statistics/quotes Nearly two thirds of fathers think they should spend more time caring for their children v.David Cameron voted against the 2nd reading of the Employment Bill on Nov 27th 2001 which introduced paternity pay vi.Attacks answered Surely extending parental will create another burden on small businesses at a time many are struggling to survive? (Generic) Mothers already have 12 months of job protected leave. We are not reinventing the wheel but making it flexible between two parents. It is true that our policy will mean employers cannot simply avoid hiring young women to avoid the possibility of parental leave – as men (of any age) might also have a child and go on leave. We regard this as a very good thing and one which will help to break down the gender pay gap. i http://direct.gov.uk/en/Parents/Moneyandworkentitlements/Parentalleaveandpay/DG_10029398 (Direct Gov Explanation)ii http://www.direct.gov.uk/en/Parents/Moneyandworkentitlements/WorkAndFamilies/Pregnancyandmaternityrights/DG_10029290 (Direct GovExplanation) iii http://www.equalities.gov.uk/default.aspx?page=1155 (Equalities Office Explanation)iv http://www.timesonline.co.uk/tol/news/uk/article783987.ece?token=null&offset=12&page=2 1st January 2006v http://www.guardian.co.uk/lifeandstyle/2009/oct/21/men-work-paternity-leave (Why don’t more Dads work part-time? 21/10/09)vi http://www.publicwhip.org.uk/mp.php?id=uk.org.publicwhip/member/1932&showall=yes#divisions (David Cameron’s Voting Record)
Q2/ Universal Pre-School Childcare The policy in brief Liberal Democrats will protect existing childcare support until such time as the country can afford to move to a permanent, universal system. Our ambition is for free and universal childcare provision for children aged 18 months - 5 years for 20 hours per week. Why it is necessary At the moment, parents in the UK pay the highest proportion of the costs of childcare than anyone else in Europe (an average 70% in the UK compared to 30% on the continent). i Although the childcare element of the working tax credit offers up to 80% of the costs of childcare (up to a cap of £175 per weekii), the system is so complicated that take-up is very low (it is used by approximately 294,500iii families out of the 2.8iv million families with children under 5 – just under 10% ).When all families are feeling the pinch, it is fair to ease the burden and give all families access to quality childcare. We are building on the current pre-school, universal entitlement of only 12.5 hours. A universal entitlement ensures easy accessibility for all families. Studies have also shown that children from deprived backgrounds benefit more from early education in settings where they mix with other children from across the social spectrum v.Policy detail The economy is in a mess and there simply isn’t the money available to introduce our ambitious plans overnight. Because quality is so important we cannot start implementing our plans until the economy has recovered. We will protect existing childcare support arrangements until the nation’s finances can support a longer term solution. We want to introduce free and universal childcare provision for children aged 18mths – 5 years for 20 hours per week. This is building on the current entitlement of 12.5 hours per week (rising to 15) for 3-5 year olds. The policy, coupled with our aspiration for 18 months’ shared parental leave, will ensure parents get seamless support, closing the current two year gap between the end of maternity leave and the beginning of help with childcare. We are committed to the existing target of having every nursery led by a graduate and members of the childcare workforce having a NVQ level 3 or higher (currently, around 1 in 5 childcare workers are not qualified to A-Level equivalence). We would like to see Children’s Centres used as training institutions to be accessed by local providers. Costs/savings We estimate that these plans will currently cost around £3bn a year, but we would need to look at these figures again before implementing this policy in the future vi. This policy will only be implemented as resources allow.Labour They say: Have invested in pre-school childcare and plan to increase it to 15 hours per week for the poorest children.We say: Have created a complex system which makes it difficult to find quality and affordable childcare.Conservatives They say: Not clearWe say: They plan to target the childcare budget for cuts and have no ambition to improve childcare in this country.Key statistics/quotes In 58% of areas across Britain, parents have complained about a lack of childcare vii. The average weekly expenditure in England for 25 hours of childcare is £88, more than half the average part-time earnings of £153 per week. One in 5 early years staff do not have a qualification beyond GCSE levelviii.Attacks answered So this policy isn’t in your manifesto, why are you talking about it? Our manifesto makes clear that this policy remains an aspiration. We recognise that affordable and high quality childcare is really important and difficult for many families to find. But the money simply isn’t available at the moment and we will not commit to things which cannot be afforded. We have credible policies to aid the economic recovery and once the country is on strong footing, there will be an opportunity to look at this policy again. i http://news.bbc.co.uk/1/hi/uk/7214704.stm (Charity says childcare costs soar, 29 January 2008)ii http://www.litrg.org.uk/help/lowincome/taxcredits/working.cfm (Will I get help with the costs of childcare?) iii http://www.hmrc.gov.uk/stats/personal-tax-credits/cwtc-apr09.pdf (Child and Working Tax Credits Statistics, April 2009, p14)iv http://www.hmrc.gov.uk/stats/personal-tax-credits/cwtc-apr09.pdf (Child and Working Tax Credits Statistics , p10)v http://www.dcsf.gov.uk/everychildmatters/publications/0/1160/ (The Effective Provision of Pre-SchoolEducation (EPPE) Project:Final Report, pg ii (1997-2004)) vi See Childcare Costing Note vii http://www.daycaretrust.org.uk/pages/childcare-costs-surveys.html (Childcare costs in 2010, Daycare Trust)viii http://www.publications.parliament.uk/pa/cm200809/cmhansrd/cm090609/text/90609w0016.htm#090609134000158 (PQ 277819, 9 June 2009, Column 847W)Q1/ Fair flexible working for all employees The policy in brief We will extend the right to request flexible working to all employees, not just parents and carers. This will embed real change in the UK’s working culture, extend the benefits of flexible working to all employees and businesses and ensure that parents and carers are not stigmatised by requesting flexible working. Why it is necessary The right to request flexible working is currently limited to a specific group, potentially stigmatising flexible working .The right to request is currently limited to those who care for a child under 17, a disabledchild who is under 18 or certain adults who require care. Under the statutory arrangements, applications cannot be made for any other reason. However, there are many valid reasons why someone may wish to work flexibly. This includes grandparents who wish to care for their grandchildren and people who want time to undertake voluntary work, or to pursue a personal interest. Giving the right to only one group of people may lead to resentment in the workplace and could stigmatise flexible working, creating a barrier to people exercising their right to request. Promoting flexible working is good for businesses .The demographics of the labour market and the nature of work itself have changed dramatically over the last few decades; for many people, the nine-to-five routine is no longer either necessary or relevant. Many employers believe that promoting flexible working makes good business sense and brings the following improvements: Ability to attract a higher level of skills because the business is able to attract and retain a skilled and more diverse workforce; increased motivation and better staff morale; reduced levels of sickness absence; improved staff retention generating better customer service and reducing recruitment costs; the chance to have extended operating hours, e.g. later closing times for retailers. Policy detail We will give all employees the right to request flexible working. It is important to note that this policy concerns only the right to request: if the nature of the work or the business needs do not make flexible working possible, the employer does not have to grant it.Employers’ rights to turn down a request will remain unchanged from current legislation. Costs/Savings This policy will has no costs to government. Labour They say: In 2003 we introduced the right to request flexible working flexible hours for parents of children up to the age of six or disabled children aged up to 18. In 2009 we extended this right to all parents with a child aged 16 or under.We say: The Government has not addressed the underlying working culture in the UK. Despite the introduction of legislation, over half (53%) of parents say their current working arrangements are ‘by necessity rather than choice’1.Conservatives They say: Would extend the right to request flexible working to all parents with children under the age of 18 and introduce a new system of flexible parental leave.We say: These are much weaker than our own proposals and do not address the wide variety of situations in which people may wish to work flexibly.Key statistics/quotes 71% of employers believe that flexible working has a positive effect on employee relations 269% of flexible workers spend more time with their family and 62% believe that it improves the quality of their children’s lives3 Other countries have seen the benefit; Germany already has a universal right to request flexible working 4Attacks answered A universal right to request flexible working will place an onerous burden on business from dealing with large volumes of requests (Generic) Many firms already offer flexible working to all employees because they can see the benefit in terms of flexibility, employee retention and motivation. The benefits of flexible will far outweigh the time spent considering flexible working requests. STORY SOURCE: http://www.flexibility.co.uk/cases/Balfour-Beatty.htm1 Equality and Human Rights Commission: Meeting the changing needs of families, workers and employers in the 21st century, page 172 Equality and Human Rights Commission, page 543 Equality and Human Rights Commission, page 164 Equality and Human Rights Commission, page 59REB Note: My apologies, I could not find anything about Grandparents caring for family and either losing or retaining Child Care payments |
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News stories posted to the site last month: Last modified: 05-06-2010 |
