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Elections are won on perceptions as much as realities: competence, trustworthiness, whether a person or party is ‘on my side’, and so on. It’s therefore brave of Labour to propose funding a cut in university tuition fees from taxes raised on pensions.
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Cutting tuition fees will only help the rich, Miliband told
http://www.thetimes.co.uk/tto/news/politics/article4368056.ece
It doesn't add up: Where Ed Miliband's gone wrong on tuition fees
http://www.independent.co.uk/voices/editorials/it-doesnt-add-up-where-ed-milibands-gone-wrong-on-tuition-fees-10076972.html
Oh, and of course the Scots have not been slow to work out they'll be diddled:
Ed Miliband's university tuition fee cut leaves Scotland with £37m shortfall
http://www.heraldscotland.com/news/education/ed-milibands-university-tuition-fee-cut-leaves-scotland-with-37m-shortfall.119559610
Far from hitting only the richest as Ed Miliband claimed, his new tax on pensions will hit many people on middle incomes including nurses, teachers and firefighters. So a tuition fees policy that only benefits better off students is being paid for by hardworking taxpayers on middle incomes.”
http://www.theguardian.com/education/2015/feb/27/labour-ed-miliband-tuition-fees
He said a nurse team leader earning about £35,500 who is in a final salary scheme and was promoted to matron on a salary of £53,500 with 25 years’ service (after carrying forward unused allowances) would lose £5,000.
Ed Miliband is seldom accused of being impulsive. Those favourable to Labour’s leader see his long pauses as proof that thoughtful action first demands that every angle be covered. But reflection does not always lead to better judgment, and his deliberations on tuition fees are a case in point.....
.....After due deliberation, Mr Miliband has offered more of a short-term electoral bribe than a real solution
http://www.ft.com/cms/s/0/aab55c5e-be7c-11e4-8036-00144feab7de.html#axzz3T0qY0jWE
Get your hols booked now or its back to Cleethorpes with Labour: )
Or will "pensions" become another on Labour's long list of doorstep verboten words?
The funny thing about populist policies is that they are often popular.
Ed Miliband Will Never Receive A Prime Ministerial Pension
No science behind this but I'm weighting probabilities around a 60:40 phone vs online polling spread across all.
ps surprised someone in their 40s brought up this tuition fee thing to me yesterday evening saying how wrong labour are. She's not a tory as far as I know, she just thinks its all wrong. Anecdote alert admittedly.
170 hours
Actually I wonder whether a cunningly constructed plan based on inheritance might be a way to go about ensuring repayment. Poorer families wouldn't be affected; richer ones would be.
Tories stronger and more competent,
Labour more divided,
Lib Dems less divided,
UKIP weaker, nastier (in fact nastiest by a full 10%), more divided and less professional.
I have a SIPP pot currently worth £74 000, and a pensionable NHS salary of £90 000 per year, with 24 years of service. This works out as 24/80 of final salary per year, and actuarially is calculated at 23 times annual pension to determine the nominal pot. My NHS pension pot is currently worth £595 000, giving a total pension pot close to £700 000. Currently I was planning another 12 or so years service, but that would put me well over the reduced pension limit. The impact of this pension tax raid is that I would bring forward my retirement. I would probably then go back to work (either private or locum) and collect my pension.
The effect would be similar at the upper echelons of Medicine, General Practice, Teaching, Academia, Judicary, Civil Service, Armed Forces etc. While I and some of these wold return as locums etc after "24 hour retirement", we would not be in positions where we would be able to pass on our skills and experience to the next generation, or use our years of experience in senior management roles.
The position in the private sector would be different, in that business people tend to make investments in their business the priority in their early years and only make big contributions into their pensions within a decade or so of retirement. They would be more affected by the annual limit than the lifetime limit.
Pensions get tax relief not as a perk, but because they are deferred income. It is very likely that I will be paying higher rate tax, even as a pensioner, so the money lost to the exchecquer in this relief does tend to return (as long as I retire in this country.
The upshot of these changes (incidentally one LD policy I disagree with) will be early retirement in the public sector and accountancy dodges in the private sector. As well as discouraging thrift and saving, it is likely to not raise the money required as paying this tax is voluntary!
A max tax free pot of £1m is too small for a decent pension for anyone retiring in 5 plus years time. This change effects everyone.
More over this potential raid reminds everyone of Labour's near criminal destruction of the pension system last time they were in power.
We will all be truly f@cked if Miliband gets in is the only conclusion from this proposed change
The whole system is a dysfunctionaĺ mess and this change does not help significantly (and also makes universities vulnerable to whims of further Chancellors.
We should move away from Brown-like stealth taxation as pension taxes and graduate taxes only encourage tax planning and new dodges. Be a bit more honest and stick up the rate on higher rate income tax and be done with it. Clean simple and honest! No wonder that our politicos do not understand it!
I had a quick reckon up of poll leads in the first two months of the year and I make it:
January - Blue 7: Ties 10: Red 26
February - Blue 7: Ties 6 : Red 28
As Nick P so regularly comments, nothing is changing. There's no trend and precious little movement. Crossover remains as elusive as ever and 'the month of pulling away' appears to have been postponed.
Personally I blame Sunil.
It's not about attracting the tiny band of Lib Dems still n existance but reminding those who once voted Clagg that Labour really can be an an honest alternative.
Milliband is proving smarter than many of us thought
VERY puzzling poll, I cannot get my head round Divided - Con 30% (-15). A move of that magnitude on any polling question at all is extraordinary, and what has happened to justify it? A slightly quiet period for euro-silliness I suppose, but 15 points?
It also does not build bridges to one of two viable coalition partners. It is a gamble on winning an absolute majority.
I defended Milliband on here long after others gave up on him but have to concede that others here were right. He is crap.
the chancellor
Winter Fuel Allowance introduced and increased at every.budget
as well as Pension Credits and of course the massive and
necessary increases in NHS spending improved ordinary
pensioners lives no end
Aaah but of course its only the rich pensioners that most PB
commenters and the Tory press and BBC care about hence the
fake crocodile tears for them over this excellent cut in Tuition Fees
policy
As NP says this will have little effect on the GE..Rich pensioners
mainly vote Tory already and so this policy can only be a vote
winner if enough Students can be arsed to get themselves out
and vote after their disullision thanks to Cleggs mob last time
Good article, Mr. Herdson. Younger voters who might benefit are less likely to vote, older voters who fear their pensions being hit (or hit in the future) are likelier to turn out.
Meanwhile senior public sector workers like me look at early retirement. Labour plans to have more GPs and Consultants, yet this pension change will worsen the shortfall and also reduce domestic training capacity. The only way to fill the gap would be increased immigration. Lack of joined up government.
Ed really has the negative Midas touch. Everything he touches turns to crap.
"It is typical of Milliband all over. Short term electoral tactics at the expense of long term sensible strategy."
For a leader on the left the most important thing is getting into office. They have one long term goal which is making the country more equitable. The 'right' restrict their ambition to simple pragmatic goals like keeping the economy bumbling along.
I'd like the government to bring in wealth taxes like they have in Holland where they take the disparity between rich and poor seriously. How could that ever happen here when even talking about the subject would be electoral suicide?
Your post about your pension describes well how redistributing money from the relatively well to do will require a crowbar which is why they need this little sleight of hand
Be kind of sad when it happens and we have to stop teasing Sunil.
Edit Duh, that's what you are saying anyway. More coffee needed.
odds, was the first to attack Murdoch openly leading to the closure
of the News of the World, stopped Dave and Nick helping replace
ASSAD with I S and is now clearly heading for a General Election
win of some kind that may be the most progressive for many
years
And as Tory Peter Oborne rightly said "he will have got into power
unlike all other recent PMs owing nothing to anybody"
The pension changes will not raise money, and students will not get any benefit until decades later. How does that help equity?
I am no fan of UKIP, but their policy on fees is the most sensible. No fees for STEM subjects provided the student pays UK tax for five years postgraduation.
Much better at ensuring equitable access to University for the poor surely?
It's becoming something of a guilty but essential pleasure most days and has the residual benefit of ensuring the chuckle muscles of most PBers remain in full working order.
Well done old chap.
The main problem with this policy is of course that it will make no difference at all to the financial situation in HE, except possibly to accelerate the looming financial crisis. It will not make the current HE model financially viable, nor will it restore free tuition. It is neither fish nor fowl.
At some point, probably within 10 years, we will have to ask which model we move to:
Either we move to an American-based market style system of loans/grants based on full market rate payments - e.g. £25,000 a year for a science degree at Warwick, and £500 a year for a pointless degree at one of those universities who effectively give out certificates for turning up (I am far too polite to mention the two worst offenders in that regard);
Or we go back to a very much smaller HE sector paid for out of general taxation.
The second option is probably not viable for all sorts of reasons, not least the economic damage it would do to several major towns and cities. Also, with the very large overseas cohort in this country, the first model is probably closer to what already happens in practice.
The joke of course is that the current system which is skewed towards disadvantaged students and towards those who will subsequently earn low incomes, while it is not in the long term sustainable, is a lot more socialist in practice than what Labour is proposing!
Unfortunately it will be in May when the yobboes and foul mouthed
cu#ts to use Anna Soubreys ladylike term will trudge over to the
opposition benches for five more years of impotence after not.learning
their lesson that only genuine "One Nation Compassonate
Conservatism" can win them a GE...not pretending to care about
hoodies and global warming and then embarking on the most
extreme right wing five year term for many a year
I'd have thought £1 million was a very big pension pot and so will the great majority of the public, so it won't hurt Labour's popularity in the short term. And it allows Ed to point to the LDs and say "Na na nana."
A little childish but typical.
So unless it is a Tory government it looks like early retirement for me.
1992
You dont even recognise the North, Scotland, Wales and London
let alone want to take any steps to win votes there by accepting
that not everyone thinks neo liberalism has been an unqualified
success and that "Britain is booming" and try to engage with them
Now run along and check your shares.
If an individual wants to go to University,presumable to obtain a degree and a higher salary over his life then that's great.. don't expect me to pay for it.
Jack W..you are right .. coolagorna is extremely funny.
Mercedes still look like frontrunners by a distance.
Edited extra bit: I'm a little tempted by Williams to be best of the rest (Betfair Exchange) although 3.15 is a little tight. I'll mull that over. It could be them, or Ferrari. Red Bull seem to be 3rd or 4th, but the Renault has perhaps more scope for improvement over the season than any other engine (although if it's the slowest that still might not make them best of the rest).
As such we do have a majority government.
A report. Attributed to David Martosko, US political editor for Dailymail.com. I saw it on the UK online version early yesterday, but today I couldn't find it on either home page, UK news or US page and I had to locate it via Google News.
"Nigel Farage warned Thursday night in America that the U.S. Republican party will become a dinosaur – not an elephant – if it continues to embrace the political center....Farage fit right in, keeping backstage handlers waiting for his appointment to test a lapel microphone while he smoked a cigar in the cold, outside the Maryland resort hotel where more than a thousand stayed into the dinner hour to hear him."
http://www.dailymail.co.uk/news/article-2971383/UKIP-chief-Nigel-Farage-warns-Republican-Party-sticks-establishment-LOSE.html
Daily Mail. Published 09.50, 27 February 2015
A report attributed to Tom McTague, Deputy Political Editor for Mailonline, now on the online home page.
"Farage left red faced after flying half way round the world to address an EMPTY ROOM at conference for hardcore US conservatives...Nigel Farage flew to Washington to address a conservative conference. But he was given the 'graveyard' speaking slot at the end of the day Just 250 people turned up to listen in a room for more than 5,000 "
http://www.dailymail.co.uk/news/article-2971786/Farage-left-red-faced-flying-half-way-round-world-address-ROOM-conference-hardcore-conservatives.html#comments
Clearly the second one is much more agreeable for CCHQ. I would imagine there must have been some very angry calls from CCHQ to the Editorial office early yesterday morning after much spluttering of tea over first editions at CCHQ, I rather fear followed by double c*ntings all round.....
Not sure this is a very astute long term commercial strategy given the political leanings of Daily Mail readers.
In general, there will be no sympathy for the big pension holders. Senior medical staff will be an exception because few will begrudge someone who's spent five years graduating and then ten to fifteen tears training to do a useful and stressful job.
However ... the usual suspect is seen to be an advertising exec whose degree is in talking himself up and his life's work is designing a nice-looking crisp packet.
Or, even worse, a banker.
JackW and Ancestors - Providing essential election forecasting since 1745 - Never knowingly undersold.
It simply will not raise the required sum. It seems the numbers are based on people continuing to make unchanged pension contributions, which they will not do. These are financially astute people who can afford good accountants.
It rather brings a whole new meaning to "something for weekend Sir?"
"They will either retire early or spend the money in other ways."
Even more reason to dislike them ...But I agree, that's why it's an Ed gimmick.
So you werent educated at school/college/uni (for free)
to enable you to have the skills and knowledge to
earn "your money" ?
You dont drive on roads that need Govt money spent
on them to maintain them?
You have never used a GP or hospital and dont wish to
pay anything to ensure that future GPs and docs can be trained?
You dont require defending from terrorism by Govt spending on security
services?
You dont need state funded police protection from burglars/muggers/killers
We live in a society not a jungle and its time "All taxation is theft
types" like you realised this
Fairly obvious though that the chopping of pension relief from those on £150,000, once established as a principle, will see pension tax relief going the same way as mortgage tax relief before too long.
The chopping of lifetime pension pots from £1.25 million to 1 million will also put the wind up a lot of ordinary people. It was £1.8 million in 2010 and has already been chopped to 1.25 million in the last few years (which rather proves my point in the previous paragraph)
Basically in 2010 the lifetime allowance got you a £90,000 per year final salary pension. Under Eds plan it gets you a £50,000 a year pension, still high but, if in the next five years it goes down another 45% as it would have done between 2010-2015 if Ed wins, then it will stand at £550,000 by the end of a five year labour government or a final salary pension of £27,500.
As a political strategy it is up there with the captain breaking the teams cricket bats before sending them to the wicked (copyright Geoffery Howe) or if Kinnock had phoned CCHQ in 1991 and said "look boyos, were going to put up income tax, I think its going to go down a bomb with the electorate"
Cameron is an extraordinarly lucky PM. Against any decent opposition he would be slaughtered in 2015. However he will probably be the biggest party and possibly have a majority due to Labours ineptness.
I have to agree with the audience member from Telford QT on Thursday who said anyone saving for a pension was being foolish because of means testing. Spend it all while young, then dump yourself on the state.
Unfortunately between the pensions raids and means testing for social care he is right. Saving for retirement is increasingly a folly.
Also we could pass a law to ensure all those sniffily against financing graduates - for example Doctors etc - are excluded from being so served by them in order to protect their precious ideological puriTy.
This is more likely to appeal to the aspirational young person who is stuck on a basic rate income or just inside the 40p band than the promise of a slightly smaller tuition fee debt.
Great article.
@Foxinsox
You are right.
@NPalmer
Labour really doesn't get pensions from what I can work out. It seems incapable of understanding anything that's not a taxpayer funded defined benefit scheme.
That said the Tories aren't blameless either historically, as I pointed out yesterday. However, if the politicians keep buggering about with the systems and disincentivising saving we are all courting trouble.
This latest policy is straight out of the G Brown play book. Superficially short term positive, long term dog's dinner. Just like the 1997 pensions tax still ticking away all these years later reducing people's old age income that they've saved for. Nobody got a bill for that in1997 but they are starting to pick the tab up now in the shape of smaller pension pots.
"... I do not work my tail off for politicians to play with their pet projects."
And don't you find anything amiss that directors of 30 second ads get paid more than neuro surgeons and prime ministers and in some cases more than both put together? Shouldn't politicians see it as their job to iron out some of these abberations? And you're not suggesting it's all based on how hard anyone works. Are you?
“there’s enough mileage for the government in the fees story itself what with richer former students benefitting most from Miliband’s message.”
Saw this mentioned a few times on PB yesterday, but only had time to skim through the threads during the day – would someone care to provide a succinct round-up as to why these former students benefit most? – ta in advance.
A point proved by the steady cutting of the lifetime pensions allowance from £1.8 million in 2010 to £1.25 million now and £1 million if Ed wins.
I do not live in the UK..but still pay considerable amounts of tax there so that you and the other residents can enjoy all those goodies you listed..Enjoy..
1-2 7/2
3-4 11/4
* guffaw *
"your post kind of sums up envious lazy leftie wanting everything for nothing losers."
I haven't voted Labour since 1997 - my last votes were LD, so leftie is a bit of a stretch. But I live in a solid Labour constituency and that is the general opinion, as I'm sure you know.
That's why Ed's move is sensible electorally. It may be childish envy and will unravel but he's a politician.
I'm now a NOTA. And to get my own back I'm going to say that Wee Eck looks like Mickey Mouse, so there.
Just do it for the minimum wage and enjoy a clear consience.
It was Labour in 1997 who were elected with a promise not to introduce tuition fees who then immediately introduced tuition fees and started this off.
Then it became what was then called "top-up fees" and it was Labour who in 2001 said in their manifesto that they were "against top-up fees and have legislated against them" - only to almost immediately after being re-elected implement them creating the £3000 fees. Oh and of course that vote was lost on English-only MPs. It was Scottish Labour MPs who created the majority.
Finally then it was Peter Mandelson and Labour who commissioned the report that recommended £9,000 fees. It is fairly obvious from history what would have happened had Labour been re-elected.
Yes the Lib-Dem minority went back on their pledges. No more than the Labour majorities have time and again. The notion that Labour is a friend of the student is absurd.
"Roger, nobody makes you take these obscene amounts of cash.
Just do it for the minimum wage and enjoy a clear consience."
I was just testing whether Doddy's distaste for overpaid directors of TV commercials was greater than his distaste for paying tax. But to answer your question society's ills are not solved by futile gestures.
I'm very biased against him, but even I am surprised at the level of contempt shown by people when he is spoken about. He suffers from the same issue as Kinnock did, he's just not seen as prime minister material.
well that's the Labour party written off then, can I put you down as an Elmbridge Tory ?
Young people will see REDUCTION IN TUITION FEES and that's about it. Nothing Martin Lewis says (and He's technically right though wrong on overarching mess the system is in) is going to change that.
Rich people whining about the tightening of the lifetime restriction on pension earnings will be laughed at. And rightly so.
Yes its electioneering, this is an election campaign we're in after all. And the proposals are no less realistic than Osborne's 'running a surplus' fantasy. In fact Eds proposal is far more feasible.