A small pedantic point no doubt - but wasn't "Levelling Up" meant to refer to helping the North of England?
Yes - taxes are high and likely to get higher. The country has spent a huge amount in the last 2 years and before then too. The Tories have abandoned their previous policies and approach but this has been known ever since Boris and his brand became a thing in the modern day Tory party.
Add @Philip_Thompson to the ever growing list of people let down by Boris.
On topic, the young are being treated abysmally. And I doubt these proposals will do much to help with social care either anyway. Even worse, neither of the other parties seem to have any ideas either and they're not much better on the trust front either.
A mess.
What did you make of Burnham's ideas on social care ?
Is there a summary of them?
I think it was something to do with IHT, which wont work.
So is the alternative to raising NI to pay for social care is to take the equity in older persons houses...
That will happen anyway since a large number of people do not have £85k in assets outside of their houses. Councils will still end up having a charge on a significant number of homes.
Indeed, and it seems as if the £85 000 limit is just on care not accommodation costs, so will be breached by many. It also won't benefit anyone until several years after the clock starts ticking in Oct 2023.
The facts are straight forward. We have a growing population of old gits - I am one. We can cure or ameliorate many diseases or illnesses that we couldn't before, and the cost is steadily rising. Everyone is in favour of continuing these advances, but no one wants to pay for them.
Successive governments have backed away from the solutions because they know it would lose them votes. Hypocritical posturing by the opposition is par for the course. Of course they won't put forward an alternative solution because there is no easy one.
With an 80 seat majority, it's up to BoJo to bite the bullet. I can't see Labour ever having that kind of majority in the near future. I admire his pluck.
"Nothing in his life became him, like the leaving it." It could be his valedictory action.
Johnson's "biting the bullet" is to go through the pretence of solving social care. Previous governments have attempted and failed to implement real solutions. Maybe if Johnson establishes a principle of universal state support for end of life social care, however minimal the implementation, a successor government will do it properly. Not sanguine however.
This is a good explainer of what the cap and floor is likely to be:
Only people meeting rather strict local government criteria for social care would qualify
The £86 000 cap would only kick in for most recipients after three years by which time most nursing home residents are dead.
They will still need to pay residential costs after the cap is met, representing about a third of the costs.
The article doesn't say this, but people getting through all that will likely fall back on local authority care under the current regime anyway.
The difference is that people can keep a little more of their assets via the tapered floor
It's unfortunate that social care requires long term thinking (and at least a measure of cross party agreement) and we have the ultimate short termist as PM.
If he was the ultimate short termist PM why has he done this?
Done what? Pretended to "solve" social care, yet not done so and booted the problem down the line whilst misleading the public?
A thoughtful piece from Philip - we have robust debates but I know that he puts his convictions front and centre which more than others manage. Leaving the party you have supported for a long time is a big thing, for me when I realised it was time to go it was a moment of peaceful clarity - only afterward did I realise I should heva done it years before.
On topic this is the government steering themselves towards the rocks on the lip of a big waterfall. A whopping tax rise which will smash their core vote and their new red wall vote, leaving only a dying off pool of rich pensioners protected.
Whats more its explicitly being called an "NHS and Social Care Levy". But provides zero money for social care. And will be swallowed whole by an NHS previously starved of front-line cash without managing to do anything other than slow the decline. "Things will get worse before they get better" said Javid, not facing up to the fact that to divert the cash to social care in a few years he would have to cut the NHS and thus guarantee no getting better at all.
This is the apocalypseofuck of policy disasters. Breaking the manifesto. Breaking their long-standing position on tax. To make the NHS worse and do nothing at all for social care.
I'm not sure it will impact their red wall voters - to do that requires Labour candidates grasping how to vote for it and I just can't see them doing that.
The *policy* will impact onto red wall voters in the form of tax rises and service reductions. How they vote is still to be seen, but lets all be very clear that in areas that already have rampant inequality and poor service provisions this is not good.
Pay more to make services even worse. Surely even the prannocks in Labour can make hay attacking that.
Had to smile, seeing not one person in the hotel breakfast just now.
To avoid a crush given covid, German hotels ration breakfast allocations typically in hourly blocks. But, being German, every single person who has booked 7-8 arrives at 7 on the dot, the same at 8. And so their system is creating precisely the covid crush every hour that they are trying to avoid. After the half hours the place is deserted.
Yesterday BA disembarked my flight from Seattle by row numbers "according to our COVID-related policy" or something. Rows 1-5, 6-10, 11-15, etc. Not only is it ridiculous to think that, if you've spent nine hours on a plane with recycled air, standing for a few minutes with them while you get off the plane will give you anything you haven't already caught, but it is also creating exactly the kind of crush you mention in your German hotel.
But then this epidemic has been paradise for people who like nagging others and bossing them around.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Is the objective not that the "rather well paid" should pick up a bigger chunk of the costs, not that that will make you happy?
I think a variety of sources will continue to be tapped as we saw yesterday- eg the amount on Council Tax per annum raised from "Adult Social Care Precept" is heading towards a billion a year, even though it is voluntary.
I don't doubt that squeezing those who are paid more is politically low-resistance but there are limits, and I already know of a couple of colleagues who are looking to move abroad to Australia.
A lot of people can aspire to salaries of £60-80k at the pinnacles of their careers and my view is we're already heavily taxed whereas those with asset wealth are undertaxed. If workers are made to feel nothing like cash cows here then don't be surprised if more leave.
My wife and I had the Switzerland discussion again, neither of us believe this 1.25% will ever stay at 1.25%. before long it's 7.5% and we're into a ~50% net tax rate situation.
Fwiw, that's a loss to the state of around £250k in tax per year in total from our incomes plus whatever we pay in consumption taxes.
Just flying by and was surprised to read your announcement. Although not of your political persuasion I take no joy in it and hope that this does not lead to a disenchantment with the political process and cause you to detach from political engagement generally and this site in particular. Your wit, wisdom and honesty would be sorely missed.
Keep well and I hope to be engaging with you again in due course, in the best sense naturally!
PtP
That was nice, so ditto.
I both enjoy and get challenged by discussions with you @Philip_Thompson We agree on a lot but also have had some humdinger disagreement on a number of topics. It is funny that when we agree I think you are putting forward brilliant arguments and when we disagree I think you are being completely dogmatic (I was going to say irrational, but I don't think I could ever call you that). I think that might say more about me than you.
You would be welcome in the LDs, but I suspect you may struggle on a few issues (eg FPTP) so in a way I hope the Tory party changes to fit people like you and @TSE better.
Philip Thompson voted for Brexit in 2016 thus changing the Tory Party from the coalition of workers it was under Cameron to the coalition of pensioners and their heirs it is now. Due to Brexit the Tories have lost many voters under 45 who voted Remain to Labour and the LDs but the Tories have gained lots of pensioners and those over 45 who voted Leave from UKIP and Labour.
He has nobody to blame but himself
Not a bad point at all. What are you still doing in the party (not a facetious question - genuinely curious).
A thoughtful piece from Philip - we have robust debates but I know that he puts his convictions front and centre which more than others manage. Leaving the party you have supported for a long time is a big thing, for me when I realised it was time to go it was a moment of peaceful clarity - only afterward did I realise I should heva done it years before.
On topic this is the government steering themselves towards the rocks on the lip of a big waterfall. A whopping tax rise which will smash their core vote and their new red wall vote, leaving only a dying off pool of rich pensioners protected.
Whats more its explicitly being called an "NHS and Social Care Levy". But provides zero money for social care. And will be swallowed whole by an NHS previously starved of front-line cash without managing to do anything other than slow the decline. "Things will get worse before they get better" said Javid, not facing up to the fact that to divert the cash to social care in a few years he would have to cut the NHS and thus guarantee no getting better at all.
This is the apocalypseofuck of policy disasters. Breaking the manifesto. Breaking their long-standing position on tax. To make the NHS worse and do nothing at all for social care.
I'm not sure it will impact their red wall voters - to do that requires Labour candidates grasping how to vote for it and I just can't see them doing that.
The *policy* will impact onto red wall voters in the form of tax rises and service reductions. How they vote is still to be seen, but lets all be very clear that in areas that already have rampant inequality and poor service provisions this is not good.
Pay more to make services even worse. Surely even the prannocks in Labour can make hay attacking that.
Yep - but unless labour finds a message that workers on these workers and their general election candidates ensure that message is drummed into voters heads - the Tory party will still win these seats in the next election.
And my point is that I just can't see their candidates being able to do that.
As an aside, attacking the proposals right now is easy. But Labour needs an alternative. Otherwise, come the election, they're standing for Don't Know. Once voters have the choice, that will be perhaps the defining substance of not only this matter but the next election.
Just flying by and was surprised to read your announcement. Although not of your political persuasion I take no joy in it and hope that this does not lead to a disenchantment with the political process and cause you to detach from political engagement generally and this site in particular. Your wit, wisdom and honesty would be sorely missed.
Keep well and I hope to be engaging with you again in due course, in the best sense naturally!
PtP
That was nice, so ditto.
I both enjoy and get challenged by discussions with you @Philip_Thompson We agree on a lot but also have had some humdinger disagreement on a number of topics. It is funny that when we agree I think you are putting forward brilliant arguments and when we disagree I think you are being completely dogmatic (I was going to say irrational, but I don't think I could ever call you that). I think that might say more about me than you.
You would be welcome in the LDs, but I suspect you may struggle on a few issues (eg FPTP) so in a way I hope the Tory party changes to fit people like you and @TSE better.
Philip Thompson voted for Brexit in 2016 thus changing the Tory Party from the coalition of workers it was under Cameron to the coalition of pensioners and their heirs it is now. Due to Brexit the Tories have lost many voters under 45 who voted Remain to Labour and the LDs but the Tories have gained lots of pensioners and those over 45 who voted Leave from UKIP and Labour.
He has nobody to blame but himself
Not a bad point at all. What are you still doing in the party (not a facetious question - genuinely curious).
I am a loyal Tory.
I voted for Cameron, I voted Remain in 2016 but I accepted the result and I still back the Tories. I always vote Tory and am a Tory member, even voting Tory in 2001 under Hague when Philip Thompson was voting Labour.
However I also recognise Brexit has changed the nature of the Tory coalition from the party mainly of workers under Cameron who had only a small lead amongst pensioners (with some of the latter in particular also voting UKIP in 2015) to a party with a huge lead amongst pensioners but which has lost the vote of most under 45s. It was Brexit which did that and it was Philip Thompson who voted for it not me, he should accept the consequences of his actions
I understand your point but at what point is the "Tory Party" not enacting "Tory" policies. It would be interesting to compare, say, this Tory govt's policies with those of a) previous Tory govts' policies; and b) previous Lab opposition and govts' policies.
My guess is that big statism would have more in common with past Labour than past Conservative.
So at what point does a "Tory" government cease being one. If all its policies are those which would have been advocated by Labour then the term is meaningless.
The serious part of the donkey with a blue rosette jibe is that the donkey doesn't have any policies.
So is the alternative to raising NI to pay for social care is to take the equity in older persons houses...
That will happen anyway since a large number of people do not have £85k in assets outside of their houses. Councils will still end up having a charge on a significant number of homes.
We may see a private insurance market for the £86K now that it is capped. Dilnot thought it could happen with a cap.
We will if it's only 1:5 or 1:10 people who need it; if it's half then the premiums will be so high that it won't be worth it.
It will be interesting to see how it develops. In the meantime, be prepared to set aside £200k from your lifetime pension pots or do an equity release for that instead of the cruise.
A thoughtful piece from Philip - we have robust debates but I know that he puts his convictions front and centre which more than others manage. Leaving the party you have supported for a long time is a big thing, for me when I realised it was time to go it was a moment of peaceful clarity - only afterward did I realise I should heva done it years before.
On topic this is the government steering themselves towards the rocks on the lip of a big waterfall. A whopping tax rise which will smash their core vote and their new red wall vote, leaving only a dying off pool of rich pensioners protected.
Whats more its explicitly being called an "NHS and Social Care Levy". But provides zero money for social care. And will be swallowed whole by an NHS previously starved of front-line cash without managing to do anything other than slow the decline. "Things will get worse before they get better" said Javid, not facing up to the fact that to divert the cash to social care in a few years he would have to cut the NHS and thus guarantee no getting better at all.
This is the apocalypseofuck of policy disasters. Breaking the manifesto. Breaking their long-standing position on tax. To make the NHS worse and do nothing at all for social care.
I'm not sure it will impact their red wall voters - to do that requires Labour candidates grasping how to vote for it and I just can't see them doing that.
The *policy* will impact onto red wall voters in the form of tax rises and service reductions. How they vote is still to be seen, but lets all be very clear that in areas that already have rampant inequality and poor service provisions this is not good.
Pay more to make services even worse. Surely even the prannocks in Labour can make hay attacking that.
Yep - but unless labour finds a message that workers on these workers and their general election candidates ensure that message is drummed into voters heads - the Tory party will still win these seats in the next election.
And my point is that I just can't see their candidates being able to do that.
Sure. We will then have gone all the way through the political looking glass where people actively vote for politicians then know are lying to them for policies that they know will actively do them harm.
I was asked a while back what my solution was to this. As I said, it is "I've left the country".
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Yes, I get you but but fixing social care was always going to cost money and if people like you don't cough up then who else is?
Those with asset wealth.
We've got to stop squeezing workers.
Agree with your concerns.
How does one define asset wealth? Those who own houses have assets. So tax them. But that includes people like you and the tax would have to be paid out of income or savings.
Pension pots? Again this will hit workers.
Etc.
Not saying that this shouldn't be done. From what I understand, these proposals seem to be incoherent and unfair. I just think that taxing wealth will also hit workers as well. There is no option that won't hit some group or other.
The problem seems to be three-fold in my mind:-
1. First, work out what social care system we want. 2. Then work out how to pay for it in a way that is fair and effective. 3. Additionally, work out a way to pay for other public services and the cost of Covid.
This seems to be a mish-mash of social care and NHS, with little regard for fairness or effectiveness and doesn't deal with point 1 at all, as fas I can see.
God knows what happens on 3. Presumably we'll learn that in October.
Tax unearned income the same as earned income, tax pension income the same as earned income. Those two changes will bring in tens of billions per year. It can be achieved by merging NI and income tax. Keep the £12.5k threshold so lower paid workers and low income pensioners actually see a net reduction/no change in tax, most workers see no change while well off pensioners and rentier types see a huge increase in their tax bills.
The way we treat unearned income is ridiculous, investment is already incentivised with CGT being 20%. We don't need to also give income from investments a tax break.
The real issue with asset taxation is -
1) Sagans of money is tied up in "assets" 2) Much of it is in the form of first homes, pensions, ISAs etc 3) The proportion that is actually owned by people with 100 metre yachts is small component of (1) 4) The public, in general thinks that the class of assets in (2) is sacrosanct.
Taxing second homes, 100 metre yachts etc will be popular, but won't raise the sums required to do very much.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Yes, I get you but but fixing social care was always going to cost money and if people like you don't cough up then who else is?
Those with asset wealth.
We've got to stop squeezing workers.
Agree with your concerns.
How does one define asset wealth? Those who own houses have assets. So tax them. But that includes people like you and the tax would have to be paid out of income or savings.
Pension pots? Again this will hit workers.
Etc.
Not saying that this shouldn't be done. From what I understand, these proposals seem to be incoherent and unfair. I just think that taxing wealth will also hit workers as well. There is no option that won't hit some group or other.
The problem seems to be three-fold in my mind:-
1. First, work out what social care system we want. 2. Then work out how to pay for it in a way that is fair and effective. 3. Additionally, work out a way to pay for other public services and the cost of Covid.
This seems to be a mish-mash of social care and NHS, with little regard for fairness or effectiveness and doesn't deal with point 1 at all, as fas I can see.
God knows what happens on 3. Presumably we'll learn that in October.
I think Max has some good suggestions. For a start, I'd add higher council tax bands and treat unearned income the same for tax purposes as earned income.
If these proposals had been put through by Labour, there would be a big pb discussion around the laffer curve by now! How sure are people that the proposals will raise 1) around what the treasury predict or even 2) more than we do now?
Or does the laffer curve only apply to Labour policies?
Nope! The changes, especially when combined with a large increase in corporation tax already announced, will influence decision-making is a way that’s negative for the UK economy.
The changes won’t raise as much as the Chancellor thinks they will, and at the margin will require even more draconian intervention of IR35 rules to clamp down on avoidance. The contractor market will be seriously affected.
Not really - HMRC will at some point pick a few firms who are using outside contractors and do to them what it has just done to DWP and other department (HMRC are definitely having "coffee chats" with companies at the moment as some outside contractors are now being told they are inside on renewal).
The biggest issue remaining is avoidance schemes but HMRC have done a fair bit of work in that area so that the costs can now be passed back to the agency - and (agency) directors ending up in jail having lost their homes should focus minds and ensure some are more careful.
Just flying by and was surprised to read your announcement. Although not of your political persuasion I take no joy in it and hope that this does not lead to a disenchantment with the political process and cause you to detach from political engagement generally and this site in particular. Your wit, wisdom and honesty would be sorely missed.
Keep well and I hope to be engaging with you again in due course, in the best sense naturally!
PtP
That was nice, so ditto.
I both enjoy and get challenged by discussions with you @Philip_Thompson We agree on a lot but also have had some humdinger disagreement on a number of topics. It is funny that when we agree I think you are putting forward brilliant arguments and when we disagree I think you are being completely dogmatic (I was going to say irrational, but I don't think I could ever call you that). I think that might say more about me than you.
You would be welcome in the LDs, but I suspect you may struggle on a few issues (eg FPTP) so in a way I hope the Tory party changes to fit people like you and @TSE better.
Philip Thompson voted for Brexit in 2016 thus changing the Tory Party from the coalition of workers it was under Cameron to the coalition of pensioners and their heirs it is now. Due to Brexit the Tories have lost many voters under 45 who voted Remain to Labour and the LDs but the Tories have gained lots of pensioners and those over 45 who voted Leave from UKIP and Labour.
He has nobody to blame but himself
Not a bad point at all. What are you still doing in the party (not a facetious question - genuinely curious).
He's a big Brexiteer?
He is a Remainer. He has seen his party, described accurately by himself, turn into something that is alien to what he has voted for previously. He disagrees with their biggest, most important, most defining policy, Brexit. Yet still he supports them, because Tory.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Is the objective not that the "rather well paid" should pick up a bigger chunk of the costs, not that that will make you happy?
I think a variety of sources will continue to be tapped as we saw yesterday- eg the amount on Council Tax per annum raised from "Adult Social Care Precept" is heading towards a billion a year, even though it is voluntary.
I don't doubt that squeezing those who are paid more is politically low-resistance but there are limits, and I already know of a couple of colleagues who are looking to move abroad to Australia.
A lot of people can aspire to salaries of £60-80k at the pinnacles of their careers and my view is we're already heavily taxed whereas those with asset wealth are undertaxed. If workers are made to feel nothing like cash cows here then don't be surprised if more leave.
My wife and I had the Switzerland discussion again, neither of us believe this 1.25% will ever stay at 1.25%. before long it's 7.5% and we're into a ~50% net tax rate situation.
Fwiw, that's a loss to the state of around £250k in tax per year in total from our incomes plus whatever we pay in consumption taxes.
Nice that you have such a sense of community that you would rather leave than contribute a bit for to fund the society that helped you develop into the man you are
Given the author has also voted for Tony Blair and Nigel Farage, we should remember he has frequently failed to support the Conservative Party in the past so what is new? It is true that under Cameron the Tory Party won most voters over 35 in 2015, indeed in 2010 the Tories won most voters over 25 so Cameron would probably have had more reservations about raising NI by 1.25% than Boris did.
However the money the NHS needs from Covid and the cost of social care at home in particular needs to come from somewhere. As a result of the Brexit the author also voted for most under 45s voted Labour in both 2017 and 2019. Even Boris in 2019 lost the vote of workers to Labour, it was only the Tories huge lead amongst pensioners in 2019 which won them a majority. So now Boris will put the interest of pensioners and those 45 to 65 year olds waiting for an inheritance first, that it just the nature of the Tory coalition now post Brexit
I am not sure you have understood why @Philip_Thompson wrote the piece. Politics should be about politicians making life work for the voters, and if it doesn't work for them they look elsewhere. Although in my mind's eye I have Philip as The Terminator, "I'll be back!"
You are more than welcome to believe the NI increase is the best method of raising the required revenue for social care, but that is not how you frame your argument. Your point is whether it works or not is irrelevant so long as it doesn't lose too many votes.
If all that matters in politics is retaining power one might as well cut to the chase and go the full Bolsanaro and prepare to call in the troops to offset waning popularity.
A small pedantic point no doubt - but wasn't "Levelling Up" meant to refer to helping the North of England?
Yes - taxes are high and likely to get higher. The country has spent a huge amount in the last 2 years and before then too. The Tories have abandoned their previous policies and approach but this has been known ever since Boris and his brand became a thing in the modern day Tory party.
Add @Philip_Thompson to the ever growing list of people let down by Boris.
On topic, the young are being treated abysmally. And I doubt these proposals will do much to help with social care either anyway. Even worse, neither of the other parties seem to have any ideas either and they're not much better on the trust front either.
A mess.
What did you make of Burnham's ideas on social care ?
Is there a summary of them?
I think it was something to do with IHT, which wont work.
He was suggesting a 10% levy on ALL estates.
I don't understand why no one is going after income from capital. It's such an easy target and would raise a lot of money. We now have three classes of tax on income:
First - income tax - everyone pays Second - NI - paid for by those who are under 65 and work both directly and indirectly Third - health and social care levy - paid for by workers of all ages and on dividend income but not rental income
It's all so unnecessary. Merge everything into income tax.
Just flying by and was surprised to read your announcement. Although not of your political persuasion I take no joy in it and hope that this does not lead to a disenchantment with the political process and cause you to detach from political engagement generally and this site in particular. Your wit, wisdom and honesty would be sorely missed.
Keep well and I hope to be engaging with you again in due course, in the best sense naturally!
PtP
That was nice, so ditto.
I both enjoy and get challenged by discussions with you @Philip_Thompson We agree on a lot but also have had some humdinger disagreement on a number of topics. It is funny that when we agree I think you are putting forward brilliant arguments and when we disagree I think you are being completely dogmatic (I was going to say irrational, but I don't think I could ever call you that). I think that might say more about me than you.
You would be welcome in the LDs, but I suspect you may struggle on a few issues (eg FPTP) so in a way I hope the Tory party changes to fit people like you and @TSE better.
Philip Thompson voted for Brexit in 2016 thus changing the Tory Party from the coalition of workers it was under Cameron to the coalition of pensioners and their heirs it is now. Due to Brexit the Tories have lost many voters under 45 who voted Remain to Labour and the LDs but the Tories have gained lots of pensioners and those over 45 who voted Leave from UKIP and Labour.
He has nobody to blame but himself
Not a bad point at all. What are you still doing in the party (not a facetious question - genuinely curious).
I am a loyal Tory.
I voted for Cameron, I voted Remain in 2016 but I accepted the result and I still back the Tories. I always vote Tory and am a Tory member, even voting Tory in 2001 under Hague when Philip Thompson was voting Labour.
However I also recognise Brexit has changed the nature of the Tory coalition from the party mainly of workers under Cameron who had only a small lead amongst pensioners (with some of the latter in particular also voting UKIP in 2015) to a party with a huge lead amongst pensioners but which has lost the vote of most under 45s. It was Brexit which did that and it was Philip Thompson who voted for it not me, he should accept the consequences of his actions
I understand your point but at what point is the "Tory Party" not enacting "Tory" policies. It would be interesting to compare, say, this Tory govt's policies with those of a) previous Tory govts' policies; and b) previous Lab opposition and govts' policies.
My guess is that big statism would have more in common with past Labour than past Conservative.
So at what point does a "Tory" government cease being one. If all its policies are those which would have been advocated by Labour then the term is meaningless.
I ran through the top dozen pledges from Corbyn's 2019 manifesto as listed on the BBC's website and could only find one - more money for the NHS - that the current government has implemented, so I think we're some way from that point.
Maybe Starmer's Labour is different, though as he hasn't deigned to announce any policies yet, who knows?
Just flying by and was surprised to read your announcement. Although not of your political persuasion I take no joy in it and hope that this does not lead to a disenchantment with the political process and cause you to detach from political engagement generally and this site in particular. Your wit, wisdom and honesty would be sorely missed.
Keep well and I hope to be engaging with you again in due course, in the best sense naturally!
PtP
That was nice, so ditto.
I both enjoy and get challenged by discussions with you @Philip_Thompson We agree on a lot but also have had some humdinger disagreement on a number of topics. It is funny that when we agree I think you are putting forward brilliant arguments and when we disagree I think you are being completely dogmatic (I was going to say irrational, but I don't think I could ever call you that). I think that might say more about me than you.
You would be welcome in the LDs, but I suspect you may struggle on a few issues (eg FPTP) so in a way I hope the Tory party changes to fit people like you and @TSE better.
Philip Thompson voted for Brexit in 2016 thus changing the Tory Party from the coalition of workers it was under Cameron to the coalition of pensioners and their heirs it is now. Due to Brexit the Tories have lost many voters under 45 who voted Remain to Labour and the LDs but the Tories have gained lots of pensioners and those over 45 who voted Leave from UKIP and Labour.
He has nobody to blame but himself
Not a bad point at all. What are you still doing in the party (not a facetious question - genuinely curious).
I am a loyal Tory.
I voted for Cameron, I voted Remain in 2016 but I accepted the result and I still back the Tories. I always vote Tory and am a Tory member, even voting Tory in 2001 under Hague when Philip Thompson was voting Labour.
However I also recognise Brexit has changed the nature of the Tory coalition from the party mainly of workers under Cameron who had only a small lead amongst pensioners (with some of the latter in particular also voting UKIP in 2015) to a party with a huge lead amongst pensioners but which has lost the vote of most under 45s. It was Brexit which did that and it was Philip Thompson who voted for it not me, he should accept the consequences of his actions
I understand your point but at what point is the "Tory Party" not enacting "Tory" policies. It would be interesting to compare, say, this Tory govt's policies with those of a) previous Tory govts' policies; and b) previous Lab opposition and govts' policies.
My guess is that big statism would have more in common with past Labour than past Conservative.
So at what point does a "Tory" government cease being one. If all its policies are those which would have been advocated by Labour then the term is meaningless.
The serious part of the donkey with a blue rosette jibe is that the donkey doesn't have any policies.
I wonder if it's all a con to be honest. If you look at how much tax the state takes as part of the economy it's moved around a little bit over the last 50 years but mainly between income tax to national insurance and between direct to indirect taxes.
At the end of the day it bumps around 35% of national income:
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Yes, I get you but but fixing social care was always going to cost money and if people like you don't cough up then who else is?
Over the next decade 6000 people are forecast to inherit £200bn. How about those people?
Yes, personally I'm a fan of inheritance tax. It's my favourite tax. Unfortunately the lumpen don't agree. And we know who this government listens to.
The problem is that IHT is to easy to dodge. Annual property taxes cover the vast majority of wealth, and would hit BTL and second homes as well as most inheiritances, and spread the burden over years rather than as a lump sum.
Recipients should have it taxed as income, with some option for spreading the hit over a number of years. Much harder to dodge, then.
It would be interesting to know how IHT works in other countries.
In the UK, in its current implementation, it fails to do the job it was designed for.
Or more cynically, it does do the job it was designed for. It was designed to allow the rich to easily evade it.
Whatever, property taxes in the UK are very low -- even compared to the US.
For example, the average effective property tax rate in New Jersey is 2.42%.
So, on a million dollar property, that is $ 24,600 annually in tax.
One by product is that big family homes are not lived in by retired couples.
You downsize pretty damn promptly once the kids leave.
Mr. Charles, I must respectfully disagree. It's perfectly legitimate to be displeased by having taxes raised, particularly when they hit the shrinking but working population to benefit the rising and non-working retired population.
As a Scotsman once said: "A democracy cannot exist as a permanent form of government. It can only exist until the majority discovers it can vote itself largess out of the public treasury."
Given the author has also voted for Tony Blair and Nigel Farage, we should remember he has frequently failed to support the Conservative Party in the past so what is new? It is true that under Cameron the Tory Party won most voters over 35 in 2015, indeed in 2010 the Tories won most voters over 25 so Cameron would probably have had more reservations about raising NI by 1.25% than Boris did.
However the money the NHS needs from Covid and the cost of social care at home in particular needs to come from somewhere. As a result of the Brexit the author also voted for most under 45s voted Labour in both 2017 and 2019. Even Boris in 2019 lost the vote of workers to Labour, it was only the Tories huge lead amongst pensioners in 2019 which won them a majority. So now Boris will put the interest of pensioners and those 45 to 65 year olds waiting for an inheritance first, that it just the nature of the Tory coalition now post Brexit
I am not sure you have understood why @Philip_Thompson wrote the piece. Politics should be about politicians making life work for the voters, and if it doesn't work for them they look elsewhere. Although in my mind's eye I have Philip as The Terminator, "I'll be back!"
You are more than welcome to believe the NI increase is the best method of raising the required revenue for social care, but that is not how you frame your argument. Your point is whether it works or not is irrelevant so long as it doesn't lose too many votes.
If all that matters in politics is retaining power one might as well cut to the chase and go the full Bolsanaro and prepare to call in the troops to offset waning popularity.
I was having real trouble working out how the figures added up yesterday. The yield seemed to be far more than 1.25p would generate. The answer is that there is a further 1.25p increase in the Employers NI as well. As someone who is self employed I only pay this levy once so my tax bill just went up by about £1200. I will also have to pay a small amount of Employer NI for my wife.
But I think that this is worth it (assuming Scotland gives equivalent cover). I do not see how else the awful sequelae of Covid can be dealt with in the short term and the costs of anything like civilised social care can be provided in the longer term. These are both going to be expensive and it will take some time for tax revenues generally to get back to anything like "normal" post pandemic.
I also think that asking people to pay the first £86k of their care costs over their lifetime is enough. If they were in hospital receiving expensive treatments for a difficult medical condition they would of course pay nothing. Dementia is a lottery and there should be a limit to the extent to which the unlucky fork out. This level is high enough that most will never reach it. The elderly with resources will be paying their "hotel" bills in addition.
I think that the government has been brave to finally seize this nettle. Several other governments both before and since Dilnot looked at this and backed off. I commend Boris for his courage.
In Scotland social care has been "free" but it has also been incredibly underfunded and scarce. Many needs have simply not been met, not just for the elderly but for the disabled as well. Yesterday, on the back of this, Sturgeon promised another £800m for Social Care. I was not immediately clear if this was over a Parliament or annual, I think the latter, but it should ensure that Social Care is more of a practical reality and less of a theoretical right. We shall see. The Scottish government is rather an old hand at announcing expenditure that never actually gets spent.
Just flying by and was surprised to read your announcement. Although not of your political persuasion I take no joy in it and hope that this does not lead to a disenchantment with the political process and cause you to detach from political engagement generally and this site in particular. Your wit, wisdom and honesty would be sorely missed.
Keep well and I hope to be engaging with you again in due course, in the best sense naturally!
PtP
That was nice, so ditto.
I both enjoy and get challenged by discussions with you @Philip_Thompson We agree on a lot but also have had some humdinger disagreement on a number of topics. It is funny that when we agree I think you are putting forward brilliant arguments and when we disagree I think you are being completely dogmatic (I was going to say irrational, but I don't think I could ever call you that). I think that might say more about me than you.
You would be welcome in the LDs, but I suspect you may struggle on a few issues (eg FPTP) so in a way I hope the Tory party changes to fit people like you and @TSE better.
Philip Thompson voted for Brexit in 2016 thus changing the Tory Party from the coalition of workers it was under Cameron to the coalition of pensioners and their heirs it is now. Due to Brexit the Tories have lost many voters under 45 who voted Remain to Labour and the LDs but the Tories have gained lots of pensioners and those over 45 who voted Leave from UKIP and Labour.
He has nobody to blame but himself
Not a bad point at all. What are you still doing in the party (not a facetious question - genuinely curious).
I am a loyal Tory.
I voted for Cameron, I voted Remain in 2016 but I accepted the result and I still back the Tories. I always vote Tory and am a Tory member, even voting Tory in 2001 under Hague when Philip Thompson was voting Labour.
However I also recognise Brexit has changed the nature of the Tory coalition from the party mainly of workers under Cameron who had only a small lead amongst pensioners (with some of the latter in particular also voting UKIP in 2015) to a party with a huge lead amongst pensioners but which has lost the vote of most under 45s. It was Brexit which did that and it was Philip Thompson who voted for it not me, he should accept the consequences of his actions
I understand your point but at what point is the "Tory Party" not enacting "Tory" policies. It would be interesting to compare, say, this Tory govt's policies with those of a) previous Tory govts' policies; and b) previous Lab opposition and govts' policies.
My guess is that big statism would have more in common with past Labour than past Conservative.
So at what point does a "Tory" government cease being one. If all its policies are those which would have been advocated by Labour then the term is meaningless.
The serious part of the donkey with a blue rosette jibe is that the donkey doesn't have any policies.
In the 1950s and 1960s and early 1970s we had Tory governments with most big industries nationalised and indeed a higher top rate of income tax than now. In those pre Thatcherite years the Tories might have been slightly less statist than Labour but it was the Liberals that were the least statist party of all, certainly pre SDP. Now with Davey an Orange Book LD and ex Minister in Cameron's austerity coalition government as Liberal leader and the LDs opposing the NI rise and Boris a Tory PM reliant on the pensioner client vote we may be going back to the days of the Liberals being the least statist of the main parties. So inevitably the Tories will lose some classical liberals. https://twitter.com/LibDems/status/1435190630427373572?s=20
In the 1870s it was also Gladstone's Liberals who were the party of the small state and free trade more than Disraeli's Tories.
The Tory Party is historically the party of the Crown, the Church of England and rural England and landed estates and on occasion British Nationalism and indeed in the 19th century the Empire.
The Tory Party only really became the small state party in the 20th century because Labour not the Liberals became its main opponent and that accelerated under Thatcher, now we are seeing some rowing back on that post Brexit under Boris
Given the author has also voted for Tony Blair and Nigel Farage, we should remember he has frequently failed to support the Conservative Party in the past so what is new? It is true that under Cameron the Tory Party won most voters over 35 in 2015, indeed in 2010 the Tories won most voters over 25 so Cameron would probably have had more reservations about raising NI by 1.25% than Boris did.
However the money the NHS needs from Covid and the cost of social care at home in particular needs to come from somewhere. As a result of the Brexit the author also voted for most under 45s voted Labour in both 2017 and 2019. Even Boris in 2019 lost the vote of workers to Labour, it was only the Tories huge lead amongst pensioners in 2019 which won them a majority. So now Boris will put the interest of pensioners and those 45 to 65 year olds waiting for an inheritance first, that it just the nature of the Tory coalition now post Brexit
I am not sure you have understood why @Philip_Thompson wrote the piece. Politics should be about politicians making life work for the voters, and if it doesn't work for them they look elsewhere. Although in my mind's eye I have Philip as The Terminator, "I'll be back!"
You are more than welcome to believe the NI increase is the best method of raising the required revenue for social care, but that is not how you frame your argument. Your point is whether it works or not is irrelevant so long as it doesn't lose too many votes.
If all that matters in politics is retaining power one might as well cut to the chase and go the full Bolsanaro and prepare to call in the troops to offset waning popularity.
A Brazilian HYUFD would surely be quite happy with the full Bolsanaro, who knows the real one may well get a chance to follow a similar leader in the UK sometime.....
Just flying by and was surprised to read your announcement. Although not of your political persuasion I take no joy in it and hope that this does not lead to a disenchantment with the political process and cause you to detach from political engagement generally and this site in particular. Your wit, wisdom and honesty would be sorely missed.
Keep well and I hope to be engaging with you again in due course, in the best sense naturally!
PtP
That was nice, so ditto.
I both enjoy and get challenged by discussions with you @Philip_Thompson We agree on a lot but also have had some humdinger disagreement on a number of topics. It is funny that when we agree I think you are putting forward brilliant arguments and when we disagree I think you are being completely dogmatic (I was going to say irrational, but I don't think I could ever call you that). I think that might say more about me than you.
You would be welcome in the LDs, but I suspect you may struggle on a few issues (eg FPTP) so in a way I hope the Tory party changes to fit people like you and @TSE better.
Philip Thompson voted for Brexit in 2016 thus changing the Tory Party from the coalition of workers it was under Cameron to the coalition of pensioners and their heirs it is now. Due to Brexit the Tories have lost many voters under 45 who voted Remain to Labour and the LDs but the Tories have gained lots of pensioners and those over 45 who voted Leave from UKIP and Labour.
He has nobody to blame but himself
Not a bad point at all. What are you still doing in the party (not a facetious question - genuinely curious).
I am a loyal Tory.
I voted for Cameron, I voted Remain in 2016 but I accepted the result and I still back the Tories. I always vote Tory and am a Tory member, even voting Tory in 2001 under Hague when Philip Thompson was voting Labour.
However I also recognise Brexit has changed the nature of the Tory coalition from the party mainly of workers under Cameron who had only a small lead amongst pensioners (with some of the latter in particular also voting UKIP in 2015) to a party with a huge lead amongst pensioners but which has lost the vote of most under 45s. It was Brexit which did that and it was Philip Thompson who voted for it not me, he should accept the consequences of his actions
I understand your point but at what point is the "Tory Party" not enacting "Tory" policies. It would be interesting to compare, say, this Tory govt's policies with those of a) previous Tory govts' policies; and b) previous Lab opposition and govts' policies.
My guess is that big statism would have more in common with past Labour than past Conservative.
So at what point does a "Tory" government cease being one. If all its policies are those which would have been advocated by Labour then the term is meaningless.
I ran through the top dozen pledges from Corbyn's 2019 manifesto as listed on the BBC's website and could only find one - more money for the NHS - that the current government has implemented, so I think we're some way from that point.
Maybe Starmer's Labour is different, though as he hasn't deigned to announce any yet, who knows?
Comparing anything with Corbyn is I believe an outlier. I would be interested to know the size of the state over the past 25 years, together with what each party had wanted it to be, and how that compares to what it will be after these changes.
NEW: Boris Johnson is considering a pre-conference reshuffle with Dominic Raab and Priti Patel increasingly seen as prime candidates for demotion alongside Gavin Williamson
Arguably more telling is that the Whitehall machine seems to believe this is real. I know of at least three departments were officials have in the last few days been ordered to refresh their briefing packs for new ministers
'1. First, work out what social care system we want. 2. Then work out how to pay for it in a way that is fair and effective. 3. Additionally, work out a way to pay for other public services and the cost of Covid.
This seems to be a mish-mash of social care and NHS, with little regard for fairness or effectiveness and doesn't deal with point 1 at all, as fas I can see.'
And she is, as so often, absolutely right.
And, even more usually, PM Johnson is making a lot of noise about a 'solution' which is far more noisy than useful.
What do we want in social care? I've no objection to paying hotel costs, for example. And if I want the finest smoked salmon on my scrambled eggs, then it's not unreasonable to pay extra for the privilege. However, if I have to go into social care because my arthritis has reached a point when I can't move from room to room, or worse, bed to chair, without assistance, why should the cost of the care worker assigned to help me move about be charged to me. If that 'work' could be done with medicines, then they would be free. As a society we've decided that!
There are numerous examples of inequity in social care vs health care and Johnson (etc)'s proposals do nothing whatsoever to even alleviate them, apart from say that there will be a maximum.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Yes, I get you but but fixing social care was always going to cost money and if people like you don't cough up then who else is?
Those with asset wealth.
We've got to stop squeezing workers.
Agree with your concerns.
How does one define asset wealth? Those who own houses have assets. So tax them. But that includes people like you and the tax would have to be paid out of income or savings.
Pension pots? Again this will hit workers.
Etc.
Not saying that this shouldn't be done. From what I understand, these proposals seem to be incoherent and unfair. I just think that taxing wealth will also hit workers as well. There is no option that won't hit some group or other.
The problem seems to be three-fold in my mind:-
1. First, work out what social care system we want. 2. Then work out how to pay for it in a way that is fair and effective. 3. Additionally, work out a way to pay for other public services and the cost of Covid.
This seems to be a mish-mash of social care and NHS, with little regard for fairness or effectiveness and doesn't deal with point 1 at all, as fas I can see.
God knows what happens on 3. Presumably we'll learn that in October.
I think Max has some good suggestions. For a start, I'd add higher council tax bands and treat unearned income the same for tax purposes as earned income.
Is taxing unearned income more going to be much of a money spinner?
A small pedantic point no doubt - but wasn't "Levelling Up" meant to refer to helping the North of England?
Yes - taxes are high and likely to get higher. The country has spent a huge amount in the last 2 years and before then too. The Tories have abandoned their previous policies and approach but this has been known ever since Boris and his brand became a thing in the modern day Tory party.
Add @Philip_Thompson to the ever growing list of people let down by Boris.
On topic, the young are being treated abysmally. And I doubt these proposals will do much to help with social care either anyway. Even worse, neither of the other parties seem to have any ideas either and they're not much better on the trust front either.
A mess.
What did you make of Burnham's ideas on social care ?
Is there a summary of them?
I think it was something to do with IHT, which wont work.
He was suggesting a 10% levy on ALL estates.
I don't understand why no one is going after income from capital. It's such an easy target and would raise a lot of money. We now have three classes of tax on income:
First - income tax - everyone pays Second - NI - paid for by those who are under 65 and work both directly and indirectly Third - health and social care levy - paid for by workers of all ages and on dividend income but not rental income
It's all so unnecessary. Merge everything into income tax.
I don't necessarily disagree with that. Note, though, that Burnham's proposal was solely aimed at social care - irrespective of that, a great deal more tax is required thanks to the pandemic. And governments prefer complicated rather than simple when they're raising tax since any confusion tends to benefit them politically.
Just flying by and was surprised to read your announcement. Although not of your political persuasion I take no joy in it and hope that this does not lead to a disenchantment with the political process and cause you to detach from political engagement generally and this site in particular. Your wit, wisdom and honesty would be sorely missed.
Keep well and I hope to be engaging with you again in due course, in the best sense naturally!
PtP
That was nice, so ditto.
I both enjoy and get challenged by discussions with you @Philip_Thompson We agree on a lot but also have had some humdinger disagreement on a number of topics. It is funny that when we agree I think you are putting forward brilliant arguments and when we disagree I think you are being completely dogmatic (I was going to say irrational, but I don't think I could ever call you that). I think that might say more about me than you.
You would be welcome in the LDs, but I suspect you may struggle on a few issues (eg FPTP) so in a way I hope the Tory party changes to fit people like you and @TSE better.
Philip Thompson voted for Brexit in 2016 thus changing the Tory Party from the coalition of workers it was under Cameron to the coalition of pensioners and their heirs it is now. Due to Brexit the Tories have lost many voters under 45 who voted Remain to Labour and the LDs but the Tories have gained lots of pensioners and those over 45 who voted Leave from UKIP and Labour.
He has nobody to blame but himself
Not a bad point at all. What are you still doing in the party (not a facetious question - genuinely curious).
I am a loyal Tory.
I voted for Cameron, I voted Remain in 2016 but I accepted the result and I still back the Tories. I always vote Tory and am a Tory member, even voting Tory in 2001 under Hague when Philip Thompson was voting Labour.
However I also recognise Brexit has changed the nature of the Tory coalition from the party mainly of workers under Cameron who had only a small lead amongst pensioners (with some of the latter in particular also voting UKIP in 2015) to a party with a huge lead amongst pensioners but which has lost the vote of most under 45s. It was Brexit which did that and it was Philip Thompson who voted for it not me, he should accept the consequences of his actions
I understand your point but at what point is the "Tory Party" not enacting "Tory" policies. It would be interesting to compare, say, this Tory govt's policies with those of a) previous Tory govts' policies; and b) previous Lab opposition and govts' policies.
My guess is that big statism would have more in common with past Labour than past Conservative.
So at what point does a "Tory" government cease being one. If all its policies are those which would have been advocated by Labour then the term is meaningless.
The serious part of the donkey with a blue rosette jibe is that the donkey doesn't have any policies.
I wonder if it's all a con to be honest. If you look at how much tax the state takes as part of the economy it's moved around a little bit over the last 50 years but mainly between income tax to national insurance and between direct to indirect taxes.
At the end of the day it bumps around 35% of national income:
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Yes, I get you but but fixing social care was always going to cost money and if people like you don't cough up then who else is?
Those with asset wealth.
We've got to stop squeezing workers.
Agree with your concerns.
How does one define asset wealth? Those who own houses have assets. So tax them. But that includes people like you and the tax would have to be paid out of income or savings.
Pension pots? Again this will hit workers.
Etc.
Not saying that this shouldn't be done. From what I understand, these proposals seem to be incoherent and unfair. I just think that taxing wealth will also hit workers as well. There is no option that won't hit some group or other.
The problem seems to be three-fold in my mind:-
1. First, work out what social care system we want. 2. Then work out how to pay for it in a way that is fair and effective. 3. Additionally, work out a way to pay for other public services and the cost of Covid.
This seems to be a mish-mash of social care and NHS, with little regard for fairness or effectiveness and doesn't deal with point 1 at all, as fas I can see.
God knows what happens on 3. Presumably we'll learn that in October.
I think Max has some good suggestions. For a start, I'd add higher council tax bands and treat unearned income the same for tax purposes as earned income.
Is taxing unearned income more going to be much of a money spinner?
Yes, hugely. But it hits the Tory core vote of old rich people.
If I have calculated this right, excluding employer contributions to pensions and appretiship levy, the marginal tax rate for a basic rate taxpaying graduate is now basically 50%
CALCS BELOW
Paybill increase = £1,150.50
Salary increase = £1,000 Income tax increase = £200 National Insurance increase = £132.50 Employer NI increase = £150.50 Student loan repayment = £90
So increase in Paybill = £1,150.50 Tax increase = £573.00
I was having real trouble working out how the figures added up yesterday. The yield seemed to be far more than 1.25p would generate. The answer is that there is a further 1.25p increase in the Employers NI as well. As someone who is self employed I only pay this levy once so my tax bill just went up by about £1200. I will also have to pay a small amount of Employer NI for my wife.
But I think that this is worth it (assuming Scotland gives equivalent cover). I do not see how else the awful sequelae of Covid can be dealt with in the short term and the costs of anything like civilised social care can be provided in the longer term. These are both going to be expensive and it will take some time for tax revenues generally to get back to anything like "normal" post pandemic.
I also think that asking people to pay the first £86k of their care costs over their lifetime is enough. If they were in hospital receiving expensive treatments for a difficult medical condition they would of course pay nothing. Dementia is a lottery and there should be a limit to the extent to which the unlucky fork out. This level is high enough that most will never reach it. The elderly with resources will be paying their "hotel" bills in addition.
I think that the government has been brave to finally seize this nettle. Several other governments both before and since Dilnot looked at this and backed off. I commend Boris for his courage.
In Scotland social care has been "free" but it has also been incredibly underfunded and scarce. Many needs have simply not been met, not just for the elderly but for the disabled as well. Yesterday, on the back of this, Sturgeon promised another £800m for Social Care. I was not immediately clear if this was over a Parliament or annual, I think the latter, but it should ensure that Social Care is more of a practical reality and less of a theoretical right. We shall see. The Scottish government is rather an old hand at announcing expenditure that never actually gets spent.
David, they explicitly *haven't* seized this nettle. If we only look at the social care aspect they have announced no money now. A promise that in a few years they will cut the NHS budget to provide a social care increase that doesn't cover the cost (as you say, the figures son't add up) is no solution.
Lets also remember that "social care" isn't just cash for dementia care. Adult social care is also in crisis with the budgets slashed and the burden passed onto already broke councils. There is nothing new here for adult care other than continuing the current post-code lottery and watching service provision fall.
More cash for less service. And you're going to vote for it?
I was having real trouble working out how the figures added up yesterday. The yield seemed to be far more than 1.25p would generate. The answer is that there is a further 1.25p increase in the Employers NI as well. As someone who is self employed I only pay this levy once so my tax bill just went up by about £1200. I will also have to pay a small amount of Employer NI for my wife.
But I think that this is worth it (assuming Scotland gives equivalent cover). I do not see how else the awful sequelae of Covid can be dealt with in the short term and the costs of anything like civilised social care can be provided in the longer term. These are both going to be expensive and it will take some time for tax revenues generally to get back to anything like "normal" post pandemic.
I also think that asking people to pay the first £86k of their care costs over their lifetime is enough. If they were in hospital receiving expensive treatments for a difficult medical condition they would of course pay nothing. Dementia is a lottery and there should be a limit to the extent to which the unlucky fork out. This level is high enough that most will never reach it. The elderly with resources will be paying their "hotel" bills in addition.
I think that the government has been brave to finally seize this nettle. Several other governments both before and since Dilnot looked at this and backed off. I commend Boris for his courage.
In Scotland social care has been "free" but it has also been incredibly underfunded and scarce. Many needs have simply not been met, not just for the elderly but for the disabled as well. Yesterday, on the back of this, Sturgeon promised another £800m for Social Care. I was not immediately clear if this was over a Parliament or annual, I think the latter, but it should ensure that Social Care is more of a practical reality and less of a theoretical right. We shall see. The Scottish government is rather an old hand at announcing expenditure that never actually gets spent.
But he hasn't fixed social care. The money is going overwhelmingly to the NHS. We have 100k care vacancies and the council coffers are still overdrawn before we recruit those. The total number of staff needed rises with our demographics. They all need to be paid a lot more, not just out of fairness but practically to compete for staff with labour shortages across many sectors. Social care will get a lot worse, not better, over the next decade if this is the solution.
Just flying by and was surprised to read your announcement. Although not of your political persuasion I take no joy in it and hope that this does not lead to a disenchantment with the political process and cause you to detach from political engagement generally and this site in particular. Your wit, wisdom and honesty would be sorely missed.
Keep well and I hope to be engaging with you again in due course, in the best sense naturally!
PtP
That was nice, so ditto.
I both enjoy and get challenged by discussions with you @Philip_Thompson We agree on a lot but also have had some humdinger disagreement on a number of topics. It is funny that when we agree I think you are putting forward brilliant arguments and when we disagree I think you are being completely dogmatic (I was going to say irrational, but I don't think I could ever call you that). I think that might say more about me than you.
You would be welcome in the LDs, but I suspect you may struggle on a few issues (eg FPTP) so in a way I hope the Tory party changes to fit people like you and @TSE better.
Philip Thompson voted for Brexit in 2016 thus changing the Tory Party from the coalition of workers it was under Cameron to the coalition of pensioners and their heirs it is now. Due to Brexit the Tories have lost many voters under 45 who voted Remain to Labour and the LDs but the Tories have gained lots of pensioners and those over 45 who voted Leave from UKIP and Labour.
He has nobody to blame but himself
Not a bad point at all. What are you still doing in the party (not a facetious question - genuinely curious).
I am a loyal Tory.
I voted for Cameron, I voted Remain in 2016 but I accepted the result and I still back the Tories. I always vote Tory and am a Tory member, even voting Tory in 2001 under Hague when Philip Thompson was voting Labour. I will also vote Tory in 2023/4 when it seems Philip Thompson will vote LD.
However I also recognise Brexit has changed the nature of the Tory coalition from the party mainly of workers under Cameron who had only a small lead amongst pensioners (with some of the latter in particular also voting UKIP in 2015) to a party with a huge lead amongst pensioners but which has lost the vote of most under 45s. It was Brexit which did that and it was Philip Thompson who voted for it not me, he should accept the consequences of his actions
You support a football team, not a political party.
Given the author has also voted for Tony Blair and Nigel Farage, we should remember he has frequently failed to support the Conservative Party in the past so what is new? It is true that under Cameron the Tory Party won most voters over 35 in 2015, indeed in 2010 the Tories won most voters over 25 so Cameron would probably have had more reservations about raising NI by 1.25% than Boris did.
However the money the NHS needs from Covid and the cost of social care at home in particular needs to come from somewhere. As a result of the Brexit the author also voted for most under 45s voted Labour in both 2017 and 2019. Even Boris in 2019 lost the vote of workers to Labour, it was only the Tories huge lead amongst pensioners in 2019 which won them a majority. So now Boris will put the interest of pensioners and those 45 to 65 year olds waiting for an inheritance first, that it just the nature of the Tory coalition now post Brexit
I am not sure you have understood why @Philip_Thompson wrote the piece. Politics should be about politicians making life work for the voters, and if it doesn't work for them they look elsewhere. Although in my mind's eye I have Philip as The Terminator, "I'll be back!"
You are more than welcome to believe the NI increase is the best method of raising the required revenue for social care, but that is not how you frame your argument. Your point is whether it works or not is irrelevant so long as it doesn't lose too many votes.
If all that matters in politics is retaining power one might as well cut to the chase and go the full Bolsanaro and prepare to call in the troops to offset waning popularity.
NI was set up to fund healthcare, state pensions and unemployment insurance, if more of it is used to fund healthcare and social care in line with what it was set up for all to the good as far as I am concerned
Just flying by and was surprised to read your announcement. Although not of your political persuasion I take no joy in it and hope that this does not lead to a disenchantment with the political process and cause you to detach from political engagement generally and this site in particular. Your wit, wisdom and honesty would be sorely missed.
Keep well and I hope to be engaging with you again in due course, in the best sense naturally!
PtP
That was nice, so ditto.
I both enjoy and get challenged by discussions with you @Philip_Thompson We agree on a lot but also have had some humdinger disagreement on a number of topics. It is funny that when we agree I think you are putting forward brilliant arguments and when we disagree I think you are being completely dogmatic (I was going to say irrational, but I don't think I could ever call you that). I think that might say more about me than you.
You would be welcome in the LDs, but I suspect you may struggle on a few issues (eg FPTP) so in a way I hope the Tory party changes to fit people like you and @TSE better.
Philip Thompson voted for Brexit in 2016 thus changing the Tory Party from the coalition of workers it was under Cameron to the coalition of pensioners and their heirs it is now. Due to Brexit the Tories have lost many voters under 45 who voted Remain to Labour and the LDs but the Tories have gained lots of pensioners and those over 45 who voted Leave from UKIP and Labour.
He has nobody to blame but himself
Well there speaks the humilty of the Johnsonites. You are not a Conservative at all, you are a Leninist obsessed with ideological purity where the only thing that matters is blind obedience to the party line both now and in the past, even when the course of history shows the failure of any given policy. If it was Tory policy then it should have been supported, regardless. If you had your way the hitherto incredibly successful broad church of the 20th century Conservatives is reduced to a fanatical Robespierre fan club where all dissent or divergence is punished.
Its an insult to peoples intelligence and it reveals an insecure desperation which, given the appalling disasters the Johnson "government" has unleashed on the country is all too justified
If I have calculated this right, excluding employer contributions to pensions and appretiship levy, the marginal tax rate for a basic rate taxpaying graduate is now basically 50%
CALCS BELOW
Paybill increase = £1,150.50
Salary increase = £1,000 Income tax increase = £200 National Insurance increase = £132.50 Employer NI increase = £150.50 Student loan repayment = £90
So increase in Paybill = £1,150.50 Tax increase = £573.00
Marginal tax rate = 49.8%
Anyone still wondering why the Tories don't get votes from young people?
A plan to set up a state-owned energy company has been dropped by the Scottish Government, Daily Business has learned.
Four years after promising a state-backed company delivering low cost power, ministers are now focusing efforts on a “new dedicated national public energy agency” that will be more of an advisory body.
I was having real trouble working out how the figures added up yesterday. The yield seemed to be far more than 1.25p would generate. The answer is that there is a further 1.25p increase in the Employers NI as well. As someone who is self employed I only pay this levy once so my tax bill just went up by about £1200. I will also have to pay a small amount of Employer NI for my wife.
But I think that this is worth it (assuming Scotland gives equivalent cover). I do not see how else the awful sequelae of Covid can be dealt with in the short term and the costs of anything like civilised social care can be provided in the longer term. These are both going to be expensive and it will take some time for tax revenues generally to get back to anything like "normal" post pandemic.
I also think that asking people to pay the first £86k of their care costs over their lifetime is enough. If they were in hospital receiving expensive treatments for a difficult medical condition they would of course pay nothing. Dementia is a lottery and there should be a limit to the extent to which the unlucky fork out. This level is high enough that most will never reach it. The elderly with resources will be paying their "hotel" bills in addition.
I think that the government has been brave to finally seize this nettle. Several other governments both before and since Dilnot looked at this and backed off. I commend Boris for his courage.
In Scotland social care has been "free" but it has also been incredibly underfunded and scarce. Many needs have simply not been met, not just for the elderly but for the disabled as well. Yesterday, on the back of this, Sturgeon promised another £800m for Social Care. I was not immediately clear if this was over a Parliament or annual, I think the latter, but it should ensure that Social Care is more of a practical reality and less of a theoretical right. We shall see. The Scottish government is rather an old hand at announcing expenditure that never actually gets spent.
But he hasn't fixed social care. The money is going overwhelmingly to the NHS. We have 100k care vacancies and the council coffers are still overdrawn before we recruit those. The total number of staff needed rises with our demographics. They all need to be paid a lot more, not just out of fairness but practically to compete for staff with labour shortages across many sectors. Social care will get a lot worse, not better, over the next decade if this is the solution.
The money will go to fund extra NHS spending over the next 18 months and then go to Social Care. I agree that wages in the SC sector need to improve but they are a consequence of the penny pinching we have had in that sector to date. This will not go away but it will be eased by these additional resources.
If I have calculated this right, excluding employer contributions to pensions and appretiship levy, the marginal tax rate for a basic rate taxpaying graduate is now basically 50%
CALCS BELOW
Paybill increase = £1,150.50
Salary increase = £1,000 Income tax increase = £200 National Insurance increase = £132.50 Employer NI increase = £150.50 Student loan repayment = £90
So increase in Paybill = £1,150.50 Tax increase = £573.00
Marginal tax rate = 49.8%
Anyone still wondering why the Tories don't get votes from young people?
Take home is less than that for the vast majority because of pension contributions as well.
Just flying by and was surprised to read your announcement. Although not of your political persuasion I take no joy in it and hope that this does not lead to a disenchantment with the political process and cause you to detach from political engagement generally and this site in particular. Your wit, wisdom and honesty would be sorely missed.
Keep well and I hope to be engaging with you again in due course, in the best sense naturally!
PtP
That was nice, so ditto.
I both enjoy and get challenged by discussions with you @Philip_Thompson We agree on a lot but also have had some humdinger disagreement on a number of topics. It is funny that when we agree I think you are putting forward brilliant arguments and when we disagree I think you are being completely dogmatic (I was going to say irrational, but I don't think I could ever call you that). I think that might say more about me than you.
You would be welcome in the LDs, but I suspect you may struggle on a few issues (eg FPTP) so in a way I hope the Tory party changes to fit people like you and @TSE better.
Philip Thompson voted for Brexit in 2016 thus changing the Tory Party from the coalition of workers it was under Cameron to the coalition of pensioners and their heirs it is now. Due to Brexit the Tories have lost many voters under 45 who voted Remain to Labour and the LDs but the Tories have gained lots of pensioners and those over 45 who voted Leave from UKIP and Labour.
He has nobody to blame but himself
Not a bad point at all. What are you still doing in the party (not a facetious question - genuinely curious).
I am a loyal Tory.
I voted for Cameron, I voted Remain in 2016 but I accepted the result and I still back the Tories. I always vote Tory and am a Tory member, even voting Tory in 2001 under Hague when Philip Thompson was voting Labour.
However I also recognise Brexit has changed the nature of the Tory coalition from the party mainly of workers under Cameron who had only a small lead amongst pensioners (with some of the latter in particular also voting UKIP in 2015) to a party with a huge lead amongst pensioners but which has lost the vote of most under 45s. It was Brexit which did that and it was Philip Thompson who voted for it not me, he should accept the consequences of his actions
I understand your point but at what point is the "Tory Party" not enacting "Tory" policies. It would be interesting to compare, say, this Tory govt's policies with those of a) previous Tory govts' policies; and b) previous Lab opposition and govts' policies.
My guess is that big statism would have more in common with past Labour than past Conservative.
So at what point does a "Tory" government cease being one. If all its policies are those which would have been advocated by Labour then the term is meaningless.
The serious part of the donkey with a blue rosette jibe is that the donkey doesn't have any policies.
I wonder if it's all a con to be honest. If you look at how much tax the state takes as part of the economy it's moved around a little bit over the last 50 years but mainly between income tax to national insurance and between direct to indirect taxes.
At the end of the day it bumps around 35% of national income:
Yes. The long term effect of this tax is to further and permanently switch the tax burden from wealthy asset owners to the working poor.
This tax taken from a generally poorer population is nominally hypothecated on popular outcomes like health and social care, which will make it impossible to cut later, while other taxes on assets can more easily be cut. It doesn't make any difference to what the overall budget gets spent on.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Yes, I get you but but fixing social care was always going to cost money and if people like you don't cough up then who else is?
Those with asset wealth.
We've got to stop squeezing workers.
Agree with your concerns.
How does one define asset wealth? Those who own houses have assets. So tax them. But that includes people like you and the tax would have to be paid out of income or savings.
Pension pots? Again this will hit workers.
Etc.
Not saying that this shouldn't be done. From what I understand, these proposals seem to be incoherent and unfair. I just think that taxing wealth will also hit workers as well. There is no option that won't hit some group or other.
The problem seems to be three-fold in my mind:-
1. First, work out what social care system we want. 2. Then work out how to pay for it in a way that is fair and effective. 3. Additionally, work out a way to pay for other public services and the cost of Covid.
This seems to be a mish-mash of social care and NHS, with little regard for fairness or effectiveness and doesn't deal with point 1 at all, as fas I can see.
God knows what happens on 3. Presumably we'll learn that in October.
The fundamental problem is that government accretes over time. Stuff gets added - like free TV licenses - that then becomes politically very difficult to address.
Your methodology is right (and very conservative) - work out what you want to do; work out how to provide it as cheaply as possible; work out how to finance it fairly and sustainably
The government needs a zero based budget approach. But that’s never going to happen. Because those who lose shout louder than those who win
I was having real trouble working out how the figures added up yesterday. The yield seemed to be far more than 1.25p would generate. The answer is that there is a further 1.25p increase in the Employers NI as well. As someone who is self employed I only pay this levy once so my tax bill just went up by about £1200. I will also have to pay a small amount of Employer NI for my wife.
But I think that this is worth it (assuming Scotland gives equivalent cover). I do not see how else the awful sequelae of Covid can be dealt with in the short term and the costs of anything like civilised social care can be provided in the longer term. These are both going to be expensive and it will take some time for tax revenues generally to get back to anything like "normal" post pandemic.
I also think that asking people to pay the first £86k of their care costs over their lifetime is enough. If they were in hospital receiving expensive treatments for a difficult medical condition they would of course pay nothing. Dementia is a lottery and there should be a limit to the extent to which the unlucky fork out. This level is high enough that most will never reach it. The elderly with resources will be paying their "hotel" bills in addition.
I think that the government has been brave to finally seize this nettle. Several other governments both before and since Dilnot looked at this and backed off. I commend Boris for his courage.
In Scotland social care has been "free" but it has also been incredibly underfunded and scarce. Many needs have simply not been met, not just for the elderly but for the disabled as well. Yesterday, on the back of this, Sturgeon promised another £800m for Social Care. I was not immediately clear if this was over a Parliament or annual, I think the latter, but it should ensure that Social Care is more of a practical reality and less of a theoretical right. We shall see. The Scottish government is rather an old hand at announcing expenditure that never actually gets spent.
David, they explicitly *haven't* seized this nettle. If we only look at the social care aspect they have announced no money now. A promise that in a few years they will cut the NHS budget to provide a social care increase that doesn't cover the cost (as you say, the figures son't add up) is no solution.
Lets also remember that "social care" isn't just cash for dementia care. Adult social care is also in crisis with the budgets slashed and the burden passed onto already broke councils. There is nothing new here for adult care other than continuing the current post-code lottery and watching service provision fall.
More cash for less service. And you're going to vote for it?
The NHS money will not be a part of their conventional budget but additional sums to deal with the backlog. The £13bn a year will make an enormous difference to the provision of social care. You can argue that it is still not enough and you may be right but it is a massive increase and it is silly to pretend otherwise.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Is the objective not that the "rather well paid" should pick up a bigger chunk of the costs, not that that will make you happy?
I think a variety of sources will continue to be tapped as we saw yesterday- eg the amount on Council Tax per annum raised from "Adult Social Care Precept" is heading towards a billion a year, even though it is voluntary.
I don't doubt that squeezing those who are paid more is politically low-resistance but there are limits, and I already know of a couple of colleagues who are looking to move abroad to Australia.
A lot of people can aspire to salaries of £60-80k at the pinnacles of their careers and my view is we're already heavily taxed whereas those with asset wealth are undertaxed. If workers are made to feel nothing like cash cows here then don't be surprised if more leave.
My wife and I had the Switzerland discussion again, neither of us believe this 1.25% will ever stay at 1.25%. before long it's 7.5% and we're into a ~50% net tax rate situation.
Fwiw, that's a loss to the state of around £250k in tax per year in total from our incomes plus whatever we pay in consumption taxes.
Nice that you have such a sense of community that you would rather leave than contribute a bit for to fund the society that helped you develop into the man you are
I am sure that you would say the same to Lord Ashcroft.
For many Tories, Johnson was the key to securing Brexit and staying in power. But having won the war, the more Thatcherite among them are starting to fear they might be losing the peace.
How Boris turned the Tories into a high tax, big state party.
Just flying by and was surprised to read your announcement. Although not of your political persuasion I take no joy in it and hope that this does not lead to a disenchantment with the political process and cause you to detach from political engagement generally and this site in particular. Your wit, wisdom and honesty would be sorely missed.
Keep well and I hope to be engaging with you again in due course, in the best sense naturally!
PtP
That was nice, so ditto.
I both enjoy and get challenged by discussions with you @Philip_Thompson We agree on a lot but also have had some humdinger disagreement on a number of topics. It is funny that when we agree I think you are putting forward brilliant arguments and when we disagree I think you are being completely dogmatic (I was going to say irrational, but I don't think I could ever call you that). I think that might say more about me than you.
You would be welcome in the LDs, but I suspect you may struggle on a few issues (eg FPTP) so in a way I hope the Tory party changes to fit people like you and @TSE better.
Philip Thompson voted for Brexit in 2016 thus changing the Tory Party from the coalition of workers it was under Cameron to the coalition of pensioners and their heirs it is now. Due to Brexit the Tories have lost many voters under 45 who voted Remain to Labour and the LDs but the Tories have gained lots of pensioners and those over 45 who voted Leave from UKIP and Labour.
He has nobody to blame but himself
Well there speaks the humilty of the Johnsonites. You are not a Conservative at all, you are a Leninist obsessed with ideological purity where the only thing that matters is blind obedience to the party line both now and in the past, even when the course of history shows the failure of any given policy. If it was Tory policy then it should have been supported, regardless. If you had your way the hitherto incredibly successful broad church of the 20th century Conservatives is reduced to a fanatical Robespierre fan club where all dissent or divergence is punished.
Its an insult to peoples intelligence and it reveals an insecure desperation which, given the appalling disasters the Johnson "government" has unleashed on the country is all too justified
Small statism is not the defining feature of the Conservative Party, I knew that when I joined the Tory Party, I am a Tory for many reasons not because I am a classical liberal. Indeed historically and certainly pre SDP that was often the defining feature of the Liberal Party. I am not a socialist but I am not a classical liberal either.
Small statism became a defining feature of the Tory and Liberal coalition government under Cameron but Brexit put a stop to that and Philip Thompson voted for it
Just flying by and was surprised to read your announcement. Although not of your political persuasion I take no joy in it and hope that this does not lead to a disenchantment with the political process and cause you to detach from political engagement generally and this site in particular. Your wit, wisdom and honesty would be sorely missed.
Keep well and I hope to be engaging with you again in due course, in the best sense naturally!
PtP
That was nice, so ditto.
I both enjoy and get challenged by discussions with you @Philip_Thompson We agree on a lot but also have had some humdinger disagreement on a number of topics. It is funny that when we agree I think you are putting forward brilliant arguments and when we disagree I think you are being completely dogmatic (I was going to say irrational, but I don't think I could ever call you that). I think that might say more about me than you.
You would be welcome in the LDs, but I suspect you may struggle on a few issues (eg FPTP) so in a way I hope the Tory party changes to fit people like you and @TSE better.
Philip Thompson voted for Brexit in 2016 thus changing the Tory Party from the coalition of workers it was under Cameron to the coalition of pensioners and their heirs it is now. Due to Brexit the Tories have lost many voters under 45 who voted Remain to Labour and the LDs but the Tories have gained lots of pensioners and those over 45 who voted Leave from UKIP and Labour.
He has nobody to blame but himself
Not a bad point at all. What are you still doing in the party (not a facetious question - genuinely curious).
I am a loyal Tory.
I voted for Cameron, I voted Remain in 2016 but I accepted the result and I still back the Tories. I always vote Tory and am a Tory member, even voting Tory in 2001 under Hague when Philip Thompson was voting Labour.
However I also recognise Brexit has changed the nature of the Tory coalition from the party mainly of workers under Cameron who had only a small lead amongst pensioners (with some of the latter in particular also voting UKIP in 2015) to a party with a huge lead amongst pensioners but which has lost the vote of most under 45s. It was Brexit which did that and it was Philip Thompson who voted for it not me, he should accept the consequences of his actions
I understand your point but at what point is the "Tory Party" not enacting "Tory" policies. It would be interesting to compare, say, this Tory govt's policies with those of a) previous Tory govts' policies; and b) previous Lab opposition and govts' policies.
My guess is that big statism would have more in common with past Labour than past Conservative.
So at what point does a "Tory" government cease being one. If all its policies are those which would have been advocated by Labour then the term is meaningless.
The serious part of the donkey with a blue rosette jibe is that the donkey doesn't have any policies.
In the 1950s and 1960s and early 1970s we had Tory governments with most big industries nationalised and indeed a higher top rate of income tax than now. In those pre Thatcherite years the Tories might have been slightly less statist than Labour but it was the Liberals that were the least statist party of all, certainly pre SDP. Now with Davey an Orange Book LD and ex Minister in Cameron's austerity coalition government as Liberal leader and the LDs opposing the NI rise and Boris a Tory PM reliant on the pensioner client vote we may be going back to the days of the Liberals being the least statist of the main parties. So inevitably the Tories will lose some classical liberals. https://twitter.com/LibDems/status/1435190630427373572?s=20
In the 1870s it was also Gladstone's Liberals who were the party of the small state and free trade more than Disraeli's Tories.
The Tory Party is historically the party of the Crown, the Church of England and rural England and landed estates and on occasion British Nationalism and indeed in the 19th century the Empire.
The Tory Party only really became the small state party in the 20th century because Labour not the Liberals became its main opponent and that accelerated under Thatcher, now we are seeing some rowing back on that post Brexit under Boris
So "the Crown, the Church of England and rural England and landed estates". That is what you are voting for.
As I understand it, you are not part of the royal family, nor the Church of England and you are a normal bloke living in Essex and hence not part of the landed gentry (I may be wrong of course). And you are certainly not a pensioner whether well off or not.
And yet you are supporting a party which benefits those parts of society that are not you. You are voting against your own interests for, to use shorthand and it's only shorthand, your "betters".
If we can't proceed from an assumption of homo economicus then we are all screwed and you don't appear to be one of those.
I was having real trouble working out how the figures added up yesterday. The yield seemed to be far more than 1.25p would generate. The answer is that there is a further 1.25p increase in the Employers NI as well. As someone who is self employed I only pay this levy once so my tax bill just went up by about £1200. I will also have to pay a small amount of Employer NI for my wife.
But I think that this is worth it (assuming Scotland gives equivalent cover). I do not see how else the awful sequelae of Covid can be dealt with in the short term and the costs of anything like civilised social care can be provided in the longer term. These are both going to be expensive and it will take some time for tax revenues generally to get back to anything like "normal" post pandemic.
I also think that asking people to pay the first £86k of their care costs over their lifetime is enough. If they were in hospital receiving expensive treatments for a difficult medical condition they would of course pay nothing. Dementia is a lottery and there should be a limit to the extent to which the unlucky fork out. This level is high enough that most will never reach it. The elderly with resources will be paying their "hotel" bills in addition.
I think that the government has been brave to finally seize this nettle. Several other governments both before and since Dilnot looked at this and backed off. I commend Boris for his courage.
In Scotland social care has been "free" but it has also been incredibly underfunded and scarce. Many needs have simply not been met, not just for the elderly but for the disabled as well. Yesterday, on the back of this, Sturgeon promised another £800m for Social Care. I was not immediately clear if this was over a Parliament or annual, I think the latter, but it should ensure that Social Care is more of a practical reality and less of a theoretical right. We shall see. The Scottish government is rather an old hand at announcing expenditure that never actually gets spent.
But he hasn't fixed social care. The money is going overwhelmingly to the NHS. We have 100k care vacancies and the council coffers are still overdrawn before we recruit those. The total number of staff needed rises with our demographics. They all need to be paid a lot more, not just out of fairness but practically to compete for staff with labour shortages across many sectors. Social care will get a lot worse, not better, over the next decade if this is the solution.
The money will go to fund extra NHS spending over the next 18 months and then go to Social Care. I agree that wages in the SC sector need to improve but they are a consequence of the penny pinching we have had in that sector to date. This will not go away but it will be eased by these additional resources.
It really won't be. The NHS will swallow up the money and be extremely reluctant to lose it. Even much of the funds allocated to social care are not new money to improve care, but changing the payer from the patient to the government. Good for the particular patient of course, but that does nothing to improve the overall quality of care across the country.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Yes, I get you but but fixing social care was always going to cost money and if people like you don't cough up then who else is?
Those with asset wealth.
We've got to stop squeezing workers.
Agree with your concerns.
How does one define asset wealth? Those who own houses have assets. So tax them. But that includes people like you and the tax would have to be paid out of income or savings.
Pension pots? Again this will hit workers.
Etc.
Not saying that this shouldn't be done. From what I understand, these proposals seem to be incoherent and unfair. I just think that taxing wealth will also hit workers as well. There is no option that won't hit some group or other.
The problem seems to be three-fold in my mind:-
1. First, work out what social care system we want. 2. Then work out how to pay for it in a way that is fair and effective. 3. Additionally, work out a way to pay for other public services and the cost of Covid.
This seems to be a mish-mash of social care and NHS, with little regard for fairness or effectiveness and doesn't deal with point 1 at all, as fas I can see.
God knows what happens on 3. Presumably we'll learn that in October.
I think Max has some good suggestions. For a start, I'd add higher council tax bands and treat unearned income the same for tax purposes as earned income.
Is taxing unearned income more going to be much of a money spinner?
Yes, hugely. But it hits the Tory core vote of old rich people.
I assume we are talking about savings interest, dividends from shares & pensions.
Won't that create the perverse incentive to not bother saving for your retirement as you will just lose large sums of it to tax?
If I have calculated this right, excluding employer contributions to pensions and appretiship levy, the marginal tax rate for a basic rate taxpaying graduate is now basically 50%
CALCS BELOW
Paybill increase = £1,150.50
Salary increase = £1,000 Income tax increase = £200 National Insurance increase = £132.50 Employer NI increase = £150.50 Student loan repayment = £90
So increase in Paybill = £1,150.50 Tax increase = £573.00
Marginal tax rate = 49.8%
Anyone still wondering why the Tories don't get votes from young people?
Take home is less than that for the vast majority because of pension contributions as well.
Anyone in the higher rate bracket will have a marginal rate over 50% now as well including student loans.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Yes, I get you but but fixing social care was always going to cost money and if people like you don't cough up then who else is?
Those with asset wealth.
We've got to stop squeezing workers.
Agree with your concerns.
How does one define asset wealth? Those who own houses have assets. So tax them. But that includes people like you and the tax would have to be paid out of income or savings.
Pension pots? Again this will hit workers.
Etc.
Not saying that this shouldn't be done. From what I understand, these proposals seem to be incoherent and unfair. I just think that taxing wealth will also hit workers as well. There is no option that won't hit some group or other.
The problem seems to be three-fold in my mind:-
1. First, work out what social care system we want. 2. Then work out how to pay for it in a way that is fair and effective. 3. Additionally, work out a way to pay for other public services and the cost of Covid.
This seems to be a mish-mash of social care and NHS, with little regard for fairness or effectiveness and doesn't deal with point 1 at all, as fas I can see.
God knows what happens on 3. Presumably we'll learn that in October.
Tax unearned income the same as earned income, tax pension income the same as earned income. Those two changes will bring in tens of billions per year. It can be achieved by merging NI and income tax. Keep the £12.5k threshold so lower paid workers and low income pensioners actually see a net reduction/no change in tax, most workers see no change while well off pensioners and rentier types see a huge increase in their tax bills.
The way we treat unearned income is ridiculous, investment is already incentivised with CGT being 20%. We don't need to also give income from investments a tax break.
Why would you lock up money in a pension for 30+ years if there are no tax breaks?
Saving is a good thing. It should be incentivised.
If these proposals had been put through by Labour, there would be a big pb discussion around the laffer curve by now! How sure are people that the proposals will raise 1) around what the treasury predict or even 2) more than we do now?
Or does the laffer curve only apply to Labour policies?
Nope! The changes, especially when combined with a large increase in corporation tax already announced, will influence decision-making is a way that’s negative for the UK economy.
The changes won’t raise as much as the Chancellor thinks they will, and at the margin will require even more draconian intervention of IR35 rules to clamp down on avoidance. The contractor market will be seriously affected.
Not really - HMRC will at some point pick a few firms who are using outside contractors and do to them what it has just done to DWP and other department (HMRC are definitely having "coffee chats" with companies at the moment as some outside contractors are now being told they are inside on renewal).
The biggest issue remaining is avoidance schemes but HMRC have done a fair bit of work in that area so that the costs can now be passed back to the agency - and (agency) directors ending up in jail having lost their homes should focus minds and ensure some are more careful.
If pretty much all contracting ends up inside IR35, then who the hell would want to be a contractor?
They’ll be paying their own transport, pension (and often accommodation & subsistence) out of income taxed at 40% and NI at 25%, and looking for a new job every few months often in a different city.
Rates are going to have to increase dramatically, which will reduce demand for contractors.
I was having real trouble working out how the figures added up yesterday. The yield seemed to be far more than 1.25p would generate. The answer is that there is a further 1.25p increase in the Employers NI as well. As someone who is self employed I only pay this levy once so my tax bill just went up by about £1200. I will also have to pay a small amount of Employer NI for my wife.
But I think that this is worth it (assuming Scotland gives equivalent cover). I do not see how else the awful sequelae of Covid can be dealt with in the short term and the costs of anything like civilised social care can be provided in the longer term. These are both going to be expensive and it will take some time for tax revenues generally to get back to anything like "normal" post pandemic.
I also think that asking people to pay the first £86k of their care costs over their lifetime is enough. If they were in hospital receiving expensive treatments for a difficult medical condition they would of course pay nothing. Dementia is a lottery and there should be a limit to the extent to which the unlucky fork out. This level is high enough that most will never reach it. The elderly with resources will be paying their "hotel" bills in addition.
I think that the government has been brave to finally seize this nettle. Several other governments both before and since Dilnot looked at this and backed off. I commend Boris for his courage.
In Scotland social care has been "free" but it has also been incredibly underfunded and scarce. Many needs have simply not been met, not just for the elderly but for the disabled as well. Yesterday, on the back of this, Sturgeon promised another £800m for Social Care. I was not immediately clear if this was over a Parliament or annual, I think the latter, but it should ensure that Social Care is more of a practical reality and less of a theoretical right. We shall see. The Scottish government is rather an old hand at announcing expenditure that never actually gets spent.
But he hasn't fixed social care. The money is going overwhelmingly to the NHS. We have 100k care vacancies and the council coffers are still overdrawn before we recruit those. The total number of staff needed rises with our demographics. They all need to be paid a lot more, not just out of fairness but practically to compete for staff with labour shortages across many sectors. Social care will get a lot worse, not better, over the next decade if this is the solution.
The money will go to fund extra NHS spending over the next 18 months and then go to Social Care. I agree that wages in the SC sector need to improve but they are a consequence of the penny pinching we have had in that sector to date. This will not go away but it will be eased by these additional resources.
You don't really believe that do you? The much more likely scenario is that the NHS comes begging for more money and social care sits unresolved so this 1.25% quickly rises to 5%.
NEW: Boris Johnson is considering a pre-conference reshuffle with Dominic Raab and Priti Patel increasingly seen as prime candidates for demotion alongside Gavin Williamson
Arguably more telling is that the Whitehall machine seems to believe this is real. I know of at least three departments were officials have in the last few days been ordered to refresh their briefing packs for new ministers
the pritster is going to have to go to mollify the gammony end of the party for a while over the channel fiasco. a new homesec can in place in time for the adverse winter weather to suppress numbers so that victory can be claimed. it would be a good position for johnson to put any rivals he feels like destroying.
If I have calculated this right, excluding employer contributions to pensions and appretiship levy, the marginal tax rate for a basic rate taxpaying graduate is now basically 50%
CALCS BELOW
Paybill increase = £1,150.50
Salary increase = £1,000 Income tax increase = £200 National Insurance increase = £132.50 Employer NI increase = £150.50 Student loan repayment = £90
So increase in Paybill = £1,150.50 Tax increase = £573.00
Marginal tax rate = 49.8%
Two points in relation to this. The first is the flaw in Philip's reasoning too. The cost of employers NI does not necessarily come from the employee. It can be an increase in overhead which can be passed on to the customer. So the "pot" for paying wages is not fixed. The competitive pressure which might make it so do not apply if all your competitors are having to pay it too.
Secondly, in both that example and in Philip's the much larger difference is the repayment of student loans. When I went to University my fees were paid and I got a grant. I came out of University debt free, dirt poor but ready for the world of work. The real brutality on our young is not an increase in NI, it is the additional tax that they pay in repayment of their student loans that all too often were mis-sold to them on the basis that it was going to give them additional income.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Yes, I get you but but fixing social care was always going to cost money and if people like you don't cough up then who else is?
Those with asset wealth.
We've got to stop squeezing workers.
Agree with your concerns.
How does one define asset wealth? Those who own houses have assets. So tax them. But that includes people like you and the tax would have to be paid out of income or savings.
Pension pots? Again this will hit workers.
Etc.
Not saying that this shouldn't be done. From what I understand, these proposals seem to be incoherent and unfair. I just think that taxing wealth will also hit workers as well. There is no option that won't hit some group or other.
The problem seems to be three-fold in my mind:-
1. First, work out what social care system we want. 2. Then work out how to pay for it in a way that is fair and effective. 3. Additionally, work out a way to pay for other public services and the cost of Covid.
This seems to be a mish-mash of social care and NHS, with little regard for fairness or effectiveness and doesn't deal with point 1 at all, as fas I can see.
God knows what happens on 3. Presumably we'll learn that in October.
Tax unearned income the same as earned income, tax pension income the same as earned income. Those two changes will bring in tens of billions per year. It can be achieved by merging NI and income tax. Keep the £12.5k threshold so lower paid workers and low income pensioners actually see a net reduction/no change in tax, most workers see no change while well off pensioners and rentier types see a huge increase in their tax bills.
The way we treat unearned income is ridiculous, investment is already incentivised with CGT being 20%. We don't need to also give income from investments a tax break.
Why would you lock up money in a pension for 30+ years if there are no tax breaks?
Saving is a good thing. It should be incentivised.
Get rid of the opt-out option for NEST and raise it to 8% employee and 5% employer contributions. Pension and savings crisis resolved.
I was having real trouble working out how the figures added up yesterday. The yield seemed to be far more than 1.25p would generate. The answer is that there is a further 1.25p increase in the Employers NI as well. As someone who is self employed I only pay this levy once so my tax bill just went up by about £1200. I will also have to pay a small amount of Employer NI for my wife.
But I think that this is worth it (assuming Scotland gives equivalent cover). I do not see how else the awful sequelae of Covid can be dealt with in the short term and the costs of anything like civilised social care can be provided in the longer term. These are both going to be expensive and it will take some time for tax revenues generally to get back to anything like "normal" post pandemic.
I also think that asking people to pay the first £86k of their care costs over their lifetime is enough. If they were in hospital receiving expensive treatments for a difficult medical condition they would of course pay nothing. Dementia is a lottery and there should be a limit to the extent to which the unlucky fork out. This level is high enough that most will never reach it. The elderly with resources will be paying their "hotel" bills in addition.
I think that the government has been brave to finally seize this nettle. Several other governments both before and since Dilnot looked at this and backed off. I commend Boris for his courage.
In Scotland social care has been "free" but it has also been incredibly underfunded and scarce. Many needs have simply not been met, not just for the elderly but for the disabled as well. Yesterday, on the back of this, Sturgeon promised another £800m for Social Care. I was not immediately clear if this was over a Parliament or annual, I think the latter, but it should ensure that Social Care is more of a practical reality and less of a theoretical right. We shall see. The Scottish government is rather an old hand at announcing expenditure that never actually gets spent.
But he hasn't fixed social care. The money is going overwhelmingly to the NHS. We have 100k care vacancies and the council coffers are still overdrawn before we recruit those. The total number of staff needed rises with our demographics. They all need to be paid a lot more, not just out of fairness but practically to compete for staff with labour shortages across many sectors. Social care will get a lot worse, not better, over the next decade if this is the solution.
The money will go to fund extra NHS spending over the next 18 months and then go to Social Care. I agree that wages in the SC sector need to improve but they are a consequence of the penny pinching we have had in that sector to date. This will not go away but it will be eased by these additional resources.
No. It really won't. Remember the NHS is already benefiting from £18.2bn a year extra from the Brexit bus and we've seen huge front line cuts. The same front line cuts were already there before the Brexit cash arrived because the NHS syphons money away from healthcare into management and legal contracts.
So the money announced today doesn't even cover the crisis funding needed. As Javid said "things will get worse" despite the funding. And then the comedy moment. A cut in the NHS budget to divert this cash to social care. Someone suggested the cash would be freed up as no more Covid. Laughable.
No SofS for Health is going to cut the NHS budget. So this cash will never go to social care. It isn't enough £ to cover the existing NHS cash shortfall. It wouldn't fund social care if the cash ever got there which it won't.
It is more tax for less services. Are you going to vote for it?
Mr. Charles, I must respectfully disagree. It's perfectly legitimate to be displeased by having taxes raised, particularly when they hit the shrinking but working population to benefit the rising and non-working retired population.
As a Scotsman once said: "A democracy cannot exist as a permanent form of government. It can only exist until the majority discovers it can vote itself largess out of the public treasury."
So is the alternative to raising NI to pay for social care is to take the equity in older persons houses...
That will happen anyway since a large number of people do not have £85k in assets outside of their houses. Councils will still end up having a charge on a significant number of homes.
Indeed, and it seems as if the £85 000 limit is just on care not accommodation costs, so will be breached by many.
If I have calculated this right, excluding employer contributions to pensions and appretiship levy, the marginal tax rate for a basic rate taxpaying graduate is now basically 50%
CALCS BELOW
Paybill increase = £1,150.50
Salary increase = £1,000 Income tax increase = £200 National Insurance increase = £132.50 Employer NI increase = £150.50 Student loan repayment = £90
So increase in Paybill = £1,150.50 Tax increase = £573.00
A small pedantic point no doubt - but wasn't "Levelling Up" meant to refer to helping the North of England?
Yes - taxes are high and likely to get higher. The country has spent a huge amount in the last 2 years and before then too. The Tories have abandoned their previous policies and approach but this has been known ever since Boris and his brand became a thing in the modern day Tory party.
Add @Philip_Thompson to the ever growing list of people let down by Boris.
On topic, the young are being treated abysmally. And I doubt these proposals will do much to help with social care either anyway. Even worse, neither of the other parties seem to have any ideas either and they're not much better on the trust front either.
A mess.
What did you make of Burnham's ideas on social care ?
Is there a summary of them?
I think it was something to do with IHT, which wont work.
He was suggesting a 10% levy on ALL estates.
The Death Tax. It was imo a sound proposal. So was Mrs May's Dementia Tax. Both of them drew the funding from wealth rather than income which makes more sense. Burnham's plan did more to spread the cost across the population and so gets the nod.
If there ever was a year for teenagers to earn some money and learn a little about the world of work before getting themselves tens of thousands in debt this was it. Yet:
Record numbers of 18-year-olds in the UK have accepted university places this year, according to updated figures from the Ucas admissions service.
There will be 272,500 of this age cohort starting at UK universities - up by 7% on last year.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Yes, I get you but but fixing social care was always going to cost money and if people like you don't cough up then who else is?
Over the next decade 6000 people are forecast to inherit £200bn. How about those people?
Yes, personally I'm a fan of inheritance tax. It's my favourite tax. Unfortunately the lumpen don't agree. And we know who this government listens to.
The problem is that IHT is to easy to dodge. Annual property taxes cover the vast majority of wealth, and would hit BTL and second homes as well as most inheiritances, and spread the burden over years rather than as a lump sum.
Recipients should have it taxed as income, with some option for spreading the hit over a number of years. Much harder to dodge, then.
My idea would be for it to be able to be head into a pension pot (Tax free above the annual but with the lifetime allowance being unchanged), which is taxable from there on out.
The 2019 Tory PB vote does seem to be splitting on age, broadly the under 50s seem against the proposal and the over 50s more mixed, either supportive or "wait and see, better than nothing" viewpoint.
I wonder if that fragility exists in the real world as well, or if it is down to this being a particularly analytical/geeky place that focuses more on the numbers than the story. Boris fixing care storyline does hold up, and if you believe it I can see why people think it might be a good thing. The numbers are both from fantasy land and unfair though.
I may be unduly cynical, but I cannot envisage the circumstances in which those at the top of the NHS will agree to shaving some of their own spending so that a higher proportion of the Levy can be diverted into care.
Therefore my real fear is that in a few years’ time there will not be a visible enough improvement in the care system to justify the claim that this persistent nettle has been effectively grasped. The practical changes that are needed are obvious. We need tens of thousands of extra care workers. We need to ensure that we have the capacity to enable people to receive care in their own homes, so that they have a better quality of life for longer and minimise the huge costs of residential care. We need to build and adapt homes differently, so that people can live for longer without needing 24-hour support. We need more care places, and we need to improve the quality of care.
If I have calculated this right, excluding employer contributions to pensions and appretiship levy, the marginal tax rate for a basic rate taxpaying graduate is now basically 50%
CALCS BELOW
Paybill increase = £1,150.50
Salary increase = £1,000 Income tax increase = £200 National Insurance increase = £132.50 Employer NI increase = £150.50 Student loan repayment = £90
So increase in Paybill = £1,150.50 Tax increase = £573.00
Marginal tax rate = 49.8%
Two points in relation to this. The first is the flaw in Philip's reasoning too. The cost of employers NI does not necessarily come from the employee. It can be an increase in overhead which can be passed on to the customer. So the "pot" for paying wages is not fixed. The competitive pressure which might make it so do not apply if all your competitors are having to pay it too.
Secondly, in both that example and in Philip's the much larger difference is the repayment of student loans. When I went to University my fees were paid and I got a grant. I came out of University debt free, dirt poor but ready for the world of work. The real brutality on our young is not an increase in NI, it is the additional tax that they pay in repayment of their student loans that all too often were mis-sold to them on the basis that it was going to give them additional income.
Notes from my meeting with HR and finance on Monday in advance of this suggest otherwise. This tax rise for employers is almost exclusively coming out of pay budgets. The company is going to take precisely zero of the increase and is set to pass it onto employees (including me) by reducing salary increases.
If there ever was a year for teenagers to earn some money and learn a little about the world of work before getting themselves tens of thousands in debt this was it. Yet:
Record numbers of 18-year-olds in the UK have accepted university places this year, according to updated figures from the Ucas admissions service.
There will be 272,500 of this age cohort starting at UK universities - up by 7% on last year.
They're not needed in the quantities received, but you're at a competitive disadvantage if you have no degree entering the world of work these days as all your peers do. That's most of it tbh - obviously every VC screeches on about how everyone needs to go.
I was having real trouble working out how the figures added up yesterday. The yield seemed to be far more than 1.25p would generate. The answer is that there is a further 1.25p increase in the Employers NI as well. As someone who is self employed I only pay this levy once so my tax bill just went up by about £1200. I will also have to pay a small amount of Employer NI for my wife.
But I think that this is worth it (assuming Scotland gives equivalent cover). I do not see how else the awful sequelae of Covid can be dealt with in the short term and the costs of anything like civilised social care can be provided in the longer term. These are both going to be expensive and it will take some time for tax revenues generally to get back to anything like "normal" post pandemic.
I also think that asking people to pay the first £86k of their care costs over their lifetime is enough. If they were in hospital receiving expensive treatments for a difficult medical condition they would of course pay nothing. Dementia is a lottery and there should be a limit to the extent to which the unlucky fork out. This level is high enough that most will never reach it. The elderly with resources will be paying their "hotel" bills in addition.
I think that the government has been brave to finally seize this nettle. Several other governments both before and since Dilnot looked at this and backed off. I commend Boris for his courage.
In Scotland social care has been "free" but it has also been incredibly underfunded and scarce. Many needs have simply not been met, not just for the elderly but for the disabled as well. Yesterday, on the back of this, Sturgeon promised another £800m for Social Care. I was not immediately clear if this was over a Parliament or annual, I think the latter, but it should ensure that Social Care is more of a practical reality and less of a theoretical right. We shall see. The Scottish government is rather an old hand at announcing expenditure that never actually gets spent.
But he hasn't fixed social care. The money is going overwhelmingly to the NHS. We have 100k care vacancies and the council coffers are still overdrawn before we recruit those. The total number of staff needed rises with our demographics. They all need to be paid a lot more, not just out of fairness but practically to compete for staff with labour shortages across many sectors. Social care will get a lot worse, not better, over the next decade if this is the solution.
The money will go to fund extra NHS spending over the next 18 months and then go to Social Care. I agree that wages in the SC sector need to improve but they are a consequence of the penny pinching we have had in that sector to date. This will not go away but it will be eased by these additional resources.
You don't really believe that do you? The much more likely scenario is that the NHS comes begging for more money and social care sits unresolved so this 1.25% quickly rises to 5%.
There will be continuing upward pressure on NHS spending, that it absolutely so. But there is a particular crisis right now that needs to be addressed and this does that.
I thought your point, with which I have some sympathy, is that this additional income should be coming from capital taxes as well as income taxes. I completely agree that the burden of taxes on income is excessive and taxes on capital are far too light. The massive gains people make on their homes tax free is distorting inter generational wealth and opportunity too. But this is a different argument from whether this money is needed. It clearly is.
Given the author has also voted for Tony Blair and Nigel Farage, we should remember he has frequently failed to support the Conservative Party in the past so what is new? It is true that under Cameron the Tory Party won most voters over 35 in 2015, indeed in 2010 the Tories won most voters over 25 so Cameron would probably have had more reservations about raising NI by 1.25% than Boris did.
However the money the NHS needs from Covid and the cost of social care at home in particular needs to come from somewhere. As a result of the Brexit the author also voted for most under 45s voted Labour in both 2017 and 2019. Even Boris in 2019 lost the vote of workers to Labour, it was only the Tories huge lead amongst pensioners in 2019 which won them a majority. So now Boris will put the interest of pensioners and those 45 to 65 year olds waiting for an inheritance first, that it just the nature of the Tory coalition now post Brexit
I am not sure you have understood why @Philip_Thompson wrote the piece. Politics should be about politicians making life work for the voters, and if it doesn't work for them they look elsewhere. Although in my mind's eye I have Philip as The Terminator, "I'll be back!"
You are more than welcome to believe the NI increase is the best method of raising the required revenue for social care, but that is not how you frame your argument. Your point is whether it works or not is irrelevant so long as it doesn't lose too many votes.
If all that matters in politics is retaining power one might as well cut to the chase and go the full Bolsanaro and prepare to call in the troops to offset waning popularity.
NI was set up to fund healthcare, state pensions and unemployment insurance, if more of it is used to fund healthcare and social care in line with what it was set up for all to the good as far as I am concerned
By a Liberal government against the vociferous and sometimes, I understand, vicious, opposition of the Conservatives.
If these proposals had been put through by Labour, there would be a big pb discussion around the laffer curve by now! How sure are people that the proposals will raise 1) around what the treasury predict or even 2) more than we do now?
Or does the laffer curve only apply to Labour policies?
Nope! The changes, especially when combined with a large increase in corporation tax already announced, will influence decision-making is a way that’s negative for the UK economy.
The changes won’t raise as much as the Chancellor thinks they will, and at the margin will require even more draconian intervention of IR35 rules to clamp down on avoidance. The contractor market will be seriously affected.
Not really - HMRC will at some point pick a few firms who are using outside contractors and do to them what it has just done to DWP and other department (HMRC are definitely having "coffee chats" with companies at the moment as some outside contractors are now being told they are inside on renewal).
The biggest issue remaining is avoidance schemes but HMRC have done a fair bit of work in that area so that the costs can now be passed back to the agency - and (agency) directors ending up in jail having lost their homes should focus minds and ensure some are more careful.
If pretty much all contracting ends up inside IR35, then who the hell would want to be a contractor?
They’ll be paying their own transport, pension (and often accommodation & subsistence) out of income taxed at 40% and NI at 25%, and looking for a new job every few months often in a different city.
Rates are going to have to increase dramatically, which will reduce demand for contractors.
I think that's true. Does the country want some people in the workforce to a. want to do the technical work on a temporary basis at short notice with no job security, holiday pay etc. or b. want everyone to be directly employed and to move up the career ladder maybe becoming poor managers where they were brilliant engineers?
Not everyone wants a career and the country needs some flexibility in the workforce.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Yes, I get you but but fixing social care was always going to cost money and if people like you don't cough up then who else is?
Those with asset wealth.
We've got to stop squeezing workers.
Agree with your concerns.
How does one define asset wealth? Those who own houses have assets. So tax them. But that includes people like you and the tax would have to be paid out of income or savings.
Pension pots? Again this will hit workers.
Etc.
Not saying that this shouldn't be done. From what I understand, these proposals seem to be incoherent and unfair. I just think that taxing wealth will also hit workers as well. There is no option that won't hit some group or other.
The problem seems to be three-fold in my mind:-
1. First, work out what social care system we want. 2. Then work out how to pay for it in a way that is fair and effective. 3. Additionally, work out a way to pay for other public services and the cost of Covid.
This seems to be a mish-mash of social care and NHS, with little regard for fairness or effectiveness and doesn't deal with point 1 at all, as fas I can see.
God knows what happens on 3. Presumably we'll learn that in October.
I think Max has some good suggestions. For a start, I'd add higher council tax bands and treat unearned income the same for tax purposes as earned income.
Is taxing unearned income more going to be much of a money spinner?
Yes, hugely. But it hits the Tory core vote of old rich people.
I assume we are talking about savings interest, dividends from shares & pensions.
Won't that create the perverse incentive to not bother saving for your retirement as you will just lose large sums of it to tax?
Yes it will.
Just as right now there is a perverse incentive not to work and to find ways to get non-employment income instead, and to dodge your taxes if you can.
That's what high taxes does. But if the taxes are moderate but apply to everyone it reduces the perverse incentives it doesn't increase them.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Is the objective not that the "rather well paid" should pick up a bigger chunk of the costs, not that that will make you happy?
I think a variety of sources will continue to be tapped as we saw yesterday- eg the amount on Council Tax per annum raised from "Adult Social Care Precept" is heading towards a billion a year, even though it is voluntary.
I don't doubt that squeezing those who are paid more is politically low-resistance but there are limits, and I already know of a couple of colleagues who are looking to move abroad to Australia.
A lot of people can aspire to salaries of £60-80k at the pinnacles of their careers and my view is we're already heavily taxed whereas those with asset wealth are undertaxed. If workers are made to feel nothing like cash cows here then don't be surprised if more leave.
My wife and I had the Switzerland discussion again, neither of us believe this 1.25% will ever stay at 1.25%. before long it's 7.5% and we're into a ~50% net tax rate situation.
Fwiw, that's a loss to the state of around £250k in tax per year in total from our incomes plus whatever we pay in consumption taxes.
Nice that you have such a sense of community that you would rather leave than contribute a bit for to fund the society that helped you develop into the man you are
I am sure that you would say the same to Lord Ashcroft.
TBF (I believe never having looked too closely) he grew up and lived most of his life in Belize. So the point about affinity and a sense of community doesn’t really apply to the UK. But he should certainly pay all of the taxes in the UK that he is required to
More cash for less service. And you're going to vote for it?
That pitch worked for Brexit
That's not how Brexit was sold, though. The pitch was more money for the NHS with no bad side effects at all.
Anyone else remember the BBC series "Hustle"?
Their motto was that the first rule of the con was to offer the mark something for nothing, then give them nothing for something.
We're now starting on phase 2.
The government want to pretend that the bus cash never existed.
Either the £350m per week / £18.2bn is now being paid to the NHS and things are so bad that we need this extra £12bn as well for services "to get worse" according to Javid.
Or the £18.2bn promised has vanished, hasn't hit the NHS hence the emergency need for funding.
Or, as we know £18.2bn was really £10.4m net. And we're paying around £7bn to the EU this year. So perhaps £3bn available for the NHS. Which it has of course swallowed without trace.
No wonder Dishi wouldn't answer the question from Nick Ferrari this morning.
I was having real trouble working out how the figures added up yesterday. The yield seemed to be far more than 1.25p would generate. The answer is that there is a further 1.25p increase in the Employers NI as well. As someone who is self employed I only pay this levy once so my tax bill just went up by about £1200. I will also have to pay a small amount of Employer NI for my wife.
But I think that this is worth it (assuming Scotland gives equivalent cover). I do not see how else the awful sequelae of Covid can be dealt with in the short term and the costs of anything like civilised social care can be provided in the longer term. These are both going to be expensive and it will take some time for tax revenues generally to get back to anything like "normal" post pandemic.
I also think that asking people to pay the first £86k of their care costs over their lifetime is enough. If they were in hospital receiving expensive treatments for a difficult medical condition they would of course pay nothing. Dementia is a lottery and there should be a limit to the extent to which the unlucky fork out. This level is high enough that most will never reach it. The elderly with resources will be paying their "hotel" bills in addition.
I think that the government has been brave to finally seize this nettle. Several other governments both before and since Dilnot looked at this and backed off. I commend Boris for his courage.
In Scotland social care has been "free" but it has also been incredibly underfunded and scarce. Many needs have simply not been met, not just for the elderly but for the disabled as well. Yesterday, on the back of this, Sturgeon promised another £800m for Social Care. I was not immediately clear if this was over a Parliament or annual, I think the latter, but it should ensure that Social Care is more of a practical reality and less of a theoretical right. We shall see. The Scottish government is rather an old hand at announcing expenditure that never actually gets spent.
But he hasn't fixed social care. The money is going overwhelmingly to the NHS. We have 100k care vacancies and the council coffers are still overdrawn before we recruit those. The total number of staff needed rises with our demographics. They all need to be paid a lot more, not just out of fairness but practically to compete for staff with labour shortages across many sectors. Social care will get a lot worse, not better, over the next decade if this is the solution.
The money will go to fund extra NHS spending over the next 18 months and then go to Social Care. I agree that wages in the SC sector need to improve but they are a consequence of the penny pinching we have had in that sector to date. This will not go away but it will be eased by these additional resources.
You don't really believe that do you? The much more likely scenario is that the NHS comes begging for more money and social care sits unresolved so this 1.25% quickly rises to 5%.
And giving the NHS the money it demands will be electorally popular.
The problem is this country wants higher government spending than it is willing to pay tax for.
And the country wants to consume more wealth than it is willing to create.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Yes, the tax hike hits us high earners quite heavily, from April 2022.
The devil is in the detail though. I note that there is no change in how Social Care is funded until October 2023, and in the meantime current arrangements prevail. The £86 000 cap is roughly 3 years of Social Care at current prices, so will only benefit people after October 2026 or thereabouts, so well after the next election.
The campaign on waiting lists is needed, but cannot really start until operating staff and anaesthetists are freed from working in ICU. In the meantime waiting lists will continue to pile up.
So pay more, get nothing.
How well can the NHS digest a three year (we've been promised it's three years only, after all!) spending boost?
Where do they get the staff to do the extra work required , it is all bollox and the money will be squandered. No doubt lots of it will find it's way into Tory chums pockets.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Yes, I get you but but fixing social care was always going to cost money and if people like you don't cough up then who else is?
Over the next decade 6000 people are forecast to inherit £200bn. How about those people?
Yes, personally I'm a fan of inheritance tax. It's my favourite tax. Unfortunately the lumpen don't agree. And we know who this government listens to.
The problem is that IHT is to easy to dodge. Annual property taxes cover the vast majority of wealth, and would hit BTL and second homes as well as most inheiritances, and spread the burden over years rather than as a lump sum.
Recipients should have it taxed as income, with some option for spreading the hit over a number of years. Much harder to dodge, then.
Yes, exactly. The current inheritance tax isn't an inheritance tax. It is a death duty. The tax should be at the recipient end not the estate end. This would iron out another unfairness: multiple siblings vs only child.
I would argue for a system which taxed beneficiaries in receipt of inheritances at, say, 10% for the first £50k and 20% thereafter. So someone dies with an estate of £1m in property = £195k tax, £805k net inheritance.
At the moment a £1m property can be inherited tax free which IMO is nothing short of obscene.
A small pedantic point no doubt - but wasn't "Levelling Up" meant to refer to helping the North of England?
Yes - taxes are high and likely to get higher. The country has spent a huge amount in the last 2 years and before then too. The Tories have abandoned their previous policies and approach but this has been known ever since Boris and his brand became a thing in the modern day Tory party.
Add @Philip_Thompson to the ever growing list of people let down by Boris.
On topic, the young are being treated abysmally. And I doubt these proposals will do much to help with social care either anyway. Even worse, neither of the other parties seem to have any ideas either and they're not much better on the trust front either.
A mess.
What did you make of Burnham's ideas on social care ?
Is there a summary of them?
I think it was something to do with IHT, which wont work.
He was suggesting a 10% levy on ALL estates.
The Death Tax. It was imo a sound proposal. So was Mrs May's Dementia Tax. Both of them drew the funding from wealth rather than income which makes more sense. Burnham's plan did more to spread the cost across the population and so gets the nod.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Yes, I get you but but fixing social care was always going to cost money and if people like you don't cough up then who else is?
Those with asset wealth.
We've got to stop squeezing workers.
Agree with your concerns.
How does one define asset wealth? Those who own houses have assets. So tax them. But that includes people like you and the tax would have to be paid out of income or savings.
Pension pots? Again this will hit workers.
Etc.
Not saying that this shouldn't be done. From what I understand, these proposals seem to be incoherent and unfair. I just think that taxing wealth will also hit workers as well. There is no option that won't hit some group or other.
The problem seems to be three-fold in my mind:-
1. First, work out what social care system we want. 2. Then work out how to pay for it in a way that is fair and effective. 3. Additionally, work out a way to pay for other public services and the cost of Covid.
This seems to be a mish-mash of social care and NHS, with little regard for fairness or effectiveness and doesn't deal with point 1 at all, as fas I can see.
God knows what happens on 3. Presumably we'll learn that in October.
Tax unearned income the same as earned income, tax pension income the same as earned income. Those two changes will bring in tens of billions per year. It can be achieved by merging NI and income tax. Keep the £12.5k threshold so lower paid workers and low income pensioners actually see a net reduction/no change in tax, most workers see no change while well off pensioners and rentier types see a huge increase in their tax bills.
The way we treat unearned income is ridiculous, investment is already incentivised with CGT being 20%. We don't need to also give income from investments a tax break.
Why would you lock up money in a pension for 30+ years if there are no tax breaks?
Saving is a good thing. It should be incentivised.
Absolutely, people will always do what they can to avoid tax, if a pension is seen to be tax inefficient, people will not put as much money in them.
We do seem to be demonising pensioners who have worked all their lives and put money away from their already taxed income to provide for themselves in retirement.
So we have the highest tax burden for x years (since 1945?). So what? In this country we seem to want Scandinavian levels of state spending without paying the eye-watering taxes that fund it. I am sure this is not the 'best' solution to social care. The plan for that is nowhere to be seen - this is generating more money for the NHS in the short term, not totally sure what it will pay for (more doctors and nurses? Well who are they?) However - it is doing something, which I feel is better than doing nothing. And we can go to the next election and the parties can tells us what they would do differently, which labour and the lib dems have not done yet (for political reasons I understand, but really if not this, then what?). Many, many older people's deepest desire is to pass on an inheritance to their kids, often when the kids don't really need it. For me and my sister, if care is needed for our parents, then the house can all go to that if that's what it takes. We are lucky. But for some its a burning need, not just among the wealthy. A colleagues MiL refuses to heat her house because she wants the kids to inherit. Yet my colleague lives in an 850,000 house, with huge pensions already accrued and has no need of the pitiful inheritance it would be. He would rather she heated the house, but she won't. This may not be the right approach, it may annoy lots of Tory voters, but at least someone has the guts to say we as a society need to pay more.
Excellent header @Philip_Thompson. I can tell you mean it and I also agree with your thrust. I suppose Johnson would have preferred to let borrowing take the strain for extra health spending but Sunak and the Treasury thought otherwise, hence the tax rises. So far, so non-scandalous, that's what the Treasury does, and we don't want Johnson just buying his way to another term using public money, least I don't, but the scandal comes with how they've chosen to do it.
If I have calculated this right, excluding employer contributions to pensions and appretiship levy, the marginal tax rate for a basic rate taxpaying graduate is now basically 50%
CALCS BELOW
Paybill increase = £1,150.50
Salary increase = £1,000 Income tax increase = £200 National Insurance increase = £132.50 Employer NI increase = £150.50 Student loan repayment = £90
So increase in Paybill = £1,150.50 Tax increase = £573.00
Marginal tax rate = 49.8%
Two points in relation to this. The first is the flaw in Philip's reasoning too. The cost of employers NI does not necessarily come from the employee. It can be an increase in overhead which can be passed on to the customer. So the "pot" for paying wages is not fixed. The competitive pressure which might make it so do not apply if all your competitors are having to pay it too.
Secondly, in both that example and in Philip's the much larger difference is the repayment of student loans. When I went to University my fees were paid and I got a grant. I came out of University debt free, dirt poor but ready for the world of work. The real brutality on our young is not an increase in NI, it is the additional tax that they pay in repayment of their student loans that all too often were mis-sold to them on the basis that it was going to give them additional income.
Notes from my meeting with HR and finance on Monday in advance of this suggest otherwise. This tax rise for employers is almost exclusively coming out of pay budgets. The company is going to take precisely zero of the increase and is set to pass it onto employees (including me) by reducing salary increases.
+1
Most companies have a fixed budget for staff - which will include employer side taxes within the budget. So if next years increase is 2.5% half of that is going to disappear before pay increases are discussed.
When it comes to contractors and temporary staff - the figure used will be a fixed amount per day - so in that case all the extra tax is going to come out of that fixed amount and your typical temporary worker is going to pay all 2.5% of it.
My wife and I are rather well paid but we calculated the impact of this last night and our household will be over £2,000 worse off a year under these new proposals.
As you can imagine neither of us are happy about it.
Yes, I get you but but fixing social care was always going to cost money and if people like you don't cough up then who else is?
Those with asset wealth.
We've got to stop squeezing workers.
Agree with your concerns.
How does one define asset wealth? Those who own houses have assets. So tax them. But that includes people like you and the tax would have to be paid out of income or savings.
Pension pots? Again this will hit workers.
Etc.
Not saying that this shouldn't be done. From what I understand, these proposals seem to be incoherent and unfair. I just think that taxing wealth will also hit workers as well. There is no option that won't hit some group or other.
The problem seems to be three-fold in my mind:-
1. First, work out what social care system we want. 2. Then work out how to pay for it in a way that is fair and effective. 3. Additionally, work out a way to pay for other public services and the cost of Covid.
This seems to be a mish-mash of social care and NHS, with little regard for fairness or effectiveness and doesn't deal with point 1 at all, as fas I can see.
God knows what happens on 3. Presumably we'll learn that in October.
Tax unearned income the same as earned income, tax pension income the same as earned income. Those two changes will bring in tens of billions per year. It can be achieved by merging NI and income tax. Keep the £12.5k threshold so lower paid workers and low income pensioners actually see a net reduction/no change in tax, most workers see no change while well off pensioners and rentier types see a huge increase in their tax bills.
The way we treat unearned income is ridiculous, investment is already incentivised with CGT being 20%. We don't need to also give income from investments a tax break.
Why would you lock up money in a pension for 30+ years if there are no tax breaks?
Saving is a good thing. It should be incentivised.
Absolutely, people will always do what they can to avoid tax, if a pension is seen to be tax inefficient, people will not put as much money in them.
We do seem to be demonising pensioners who have worked all their lives and put money away from their already taxed income to provide for themselves in retirement.
Demonise = Make them the richest generation ever, and on average richer than their kids and grandkids will be in retirement.
Comments
He said he had a plan for social care. He has now announced a plan.
That it doesn't fix social care doesn't matter in a post truth World so job done
This is a good explainer of what the cap and floor is likely to be:
- Only people meeting rather strict local government criteria for social care would qualify
- The £86 000 cap would only kick in for most recipients after three years by which time most nursing home residents are dead.
- They will still need to pay residential costs after the cap is met, representing about a third of the costs.
- The article doesn't say this, but people getting through all that will likely fall back on local authority care under the current regime anyway.
- The difference is that people can keep a little more of their assets via the tapered floor
https://www.bbc.co.uk/news/health-58442991Pay more to make services even worse. Surely even the prannocks in Labour can make hay attacking that.
But then this epidemic has been paradise for people who like nagging others and bossing them around.
And my point is that I just can't see their candidates being able to do that.
My guess is that big statism would have more in common with past Labour than past Conservative.
So at what point does a "Tory" government cease being one. If all its policies are those which would have been advocated by Labour then the term is meaningless.
The serious part of the donkey with a blue rosette jibe is that the donkey doesn't have any policies.
It will be interesting to see how it develops. In the meantime, be prepared to set aside £200k from your lifetime pension pots or do an equity release for that instead of the cruise.
I was asked a while back what my solution was to this. As I said, it is "I've left the country".
1) Sagans of money is tied up in "assets"
2) Much of it is in the form of first homes, pensions, ISAs etc
3) The proportion that is actually owned by people with 100 metre yachts is small component of (1)
4) The public, in general thinks that the class of assets in (2) is sacrosanct.
Taxing second homes, 100 metre yachts etc will be popular, but won't raise the sums required to do very much.
The biggest issue remaining is avoidance schemes but HMRC have done a fair bit of work in that area so that the costs can now be passed back to the agency - and (agency) directors ending up in jail having lost their homes should focus minds and ensure some are more careful.
It's not necessarily a rational position.
You are more than welcome to believe the NI increase is the best method of raising the required revenue for social care, but that is not how you frame your argument. Your point is whether it works or not is irrelevant so long as it doesn't lose too many votes.
If all that matters in politics is retaining power one might as well cut to the chase and go the full Bolsanaro and prepare to call in the troops to offset waning popularity.
First - income tax - everyone pays
Second - NI - paid for by those who are under 65 and work both directly and indirectly
Third - health and social care levy - paid for by workers of all ages and on dividend income but not rental income
It's all so unnecessary. Merge everything into income tax.
Maybe Starmer's Labour is different, though as he hasn't deigned to announce any policies yet, who knows?
At the end of the day it bumps around 35% of national income:
https://twitter.com/EdConwaySky/status/1435320808314970113?s=20
In the UK, in its current implementation, it fails to do the job it was designed for.
Or more cynically, it does do the job it was designed for. It was designed to allow the rich to easily evade it.
Whatever, property taxes in the UK are very low -- even compared to the US.
For example, the average effective property tax rate in New Jersey is 2.42%.
So, on a million dollar property, that is $ 24,600 annually in tax.
One by product is that big family homes are not lived in by retired couples.
You downsize pretty damn promptly once the kids leave.
As a Scotsman once said:
"A democracy cannot exist as a permanent form of government. It can only exist until the majority discovers it can vote itself largess out of the public treasury."
https://en.wikipedia.org/wiki/Alexander_Fraser_Tytler,_Lord_Woodhouselee
But I think that this is worth it (assuming Scotland gives equivalent cover). I do not see how else the awful sequelae of Covid can be dealt with in the short term and the costs of anything like civilised social care can be provided in the longer term. These are both going to be expensive and it will take some time for tax revenues generally to get back to anything like "normal" post pandemic.
I also think that asking people to pay the first £86k of their care costs over their lifetime is enough. If they were in hospital receiving expensive treatments for a difficult medical condition they would of course pay nothing. Dementia is a lottery and there should be a limit to the extent to which the unlucky fork out. This level is high enough that most will never reach it. The elderly with resources will be paying their "hotel" bills in addition.
I think that the government has been brave to finally seize this nettle. Several other governments both before and since Dilnot looked at this and backed off. I commend Boris for his courage.
In Scotland social care has been "free" but it has also been incredibly underfunded and scarce. Many needs have simply not been met, not just for the elderly but for the disabled as well. Yesterday, on the back of this, Sturgeon promised another £800m for Social Care. I was not immediately clear if this was over a Parliament or annual, I think the latter, but it should ensure that Social Care is more of a practical reality and less of a theoretical right. We shall see. The Scottish government is rather an old hand at announcing expenditure that never actually gets spent.
https://twitter.com/LibDems/status/1435190630427373572?s=20
In the 1870s it was also Gladstone's Liberals who were the party of the small state and free trade more than Disraeli's Tories.
The Tory Party is historically the party of the Crown, the Church of England and rural England and landed estates and on occasion British Nationalism and indeed in the 19th century the Empire.
The Tory Party only really became the small state party in the 20th century because Labour not the Liberals became its main opponent and that accelerated under Thatcher, now we are seeing some rowing back on that post Brexit under Boris
https://www.thetimes.co.uk/article/5e4f4272-1018-11ec-872c-7810b420a767?shareToken=325a43dd616ffe754909f837b3e7c7d2
Arguably more telling is that the Whitehall machine seems to believe this is real. I know of at least three departments were officials have in the last few days been ordered to refresh their briefing packs for new ministers
'1. First, work out what social care system we want.
2. Then work out how to pay for it in a way that is fair and effective.
3. Additionally, work out a way to pay for other public services and the cost of Covid.
This seems to be a mish-mash of social care and NHS, with little regard for fairness or effectiveness and doesn't deal with point 1 at all, as fas I can see.'
And she is, as so often, absolutely right.
And, even more usually, PM Johnson is making a lot of noise about a 'solution' which is far more noisy than useful.
What do we want in social care? I've no objection to paying hotel costs, for example. And if I want the finest smoked salmon on my scrambled eggs, then it's not unreasonable to pay extra for the privilege.
However, if I have to go into social care because my arthritis has reached a point when I can't move from room to room, or worse, bed to chair, without assistance, why should the cost of the care worker assigned to help me move about be charged to me. If that 'work' could be done with medicines, then they would be free. As a society we've decided that!
There are numerous examples of inequity in social care vs health care and Johnson (etc)'s proposals do nothing whatsoever to even alleviate them, apart from say that there will be a maximum.
Years with your head rammed up Boris's backside ending because he wants you to pay a little more tax
I feel for you.
Note, though, that Burnham's proposal was solely aimed at social care - irrespective of that, a great deal more tax is required thanks to the pandemic. And governments prefer complicated rather than simple when they're raising tax since any confusion tends to benefit them politically.
Means Cons' "low tax, economically sound, individual freedom" appeal is muted somewhat.
https://twitter.com/ChrisGiles_/status/1435501932060286979?s=20
If I have calculated this right, excluding employer contributions to pensions and appretiship levy, the marginal tax rate for a basic rate taxpaying graduate is now basically 50%
CALCS BELOW
Paybill increase = £1,150.50
Salary increase = £1,000
Income tax increase = £200
National Insurance increase = £132.50
Employer NI increase = £150.50
Student loan repayment = £90
So increase in Paybill = £1,150.50
Tax increase = £573.00
Marginal tax rate = 49.8%
The Welsh boundary commission has released its initial proposals today.
MPs go down from 40 to 32 so there are some quite large changes.
Lets also remember that "social care" isn't just cash for dementia care. Adult social care is also in crisis with the budgets slashed and the burden passed onto already broke councils. There is nothing new here for adult care other than continuing the current post-code lottery and watching service provision fall.
More cash for less service. And you're going to vote for it?
Its an insult to peoples intelligence and it reveals an insecure desperation which, given the appalling disasters the Johnson "government" has unleashed on the country is all too justified
Four years after promising a state-backed company delivering low cost power, ministers are now focusing efforts on a “new dedicated national public energy agency” that will be more of an advisory body.
https://dailybusinessgroup.co.uk/2021/09/holyrood-scraps-plan-for-public-energy-company/
https://bit.ly/3h7GsIv https://twitter.com/matt_dathan/status/1435382652551446529
This will make it easier for BoZo to sack Ms Patel
This tax taken from a generally poorer population is nominally hypothecated on popular outcomes like health and social care, which will make it impossible to cut later, while other taxes on assets can more easily be cut. It doesn't make any difference to what the overall budget gets spent on.
Your methodology is right (and very conservative) - work out what you want to do; work out how to provide it as cheaply as possible; work out how to finance it fairly and sustainably
The government needs a zero based budget approach. But that’s never going to happen. Because those who lose shout louder than those who win
Which health secretary in 18 months is going to stand at the despatch box and say we are cutting the NHS budget to fund social care?
It's a fantasy
How Boris turned the Tories into a high tax, big state party.
https://www.ft.com/content/3e26e47c-4ed1-490a-a860-46bc6edd913a?sharetype=blocked
Small statism became a defining feature of the Tory and Liberal coalition government under Cameron but Brexit put a stop to that and Philip Thompson voted for it
As I understand it, you are not part of the royal family, nor the Church of England and you are a normal bloke living in Essex and hence not part of the landed gentry (I may be wrong of course). And you are certainly not a pensioner whether well off or not.
And yet you are supporting a party which benefits those parts of society that are not you. You are voting against your own interests for, to use shorthand and it's only shorthand, your "betters".
If we can't proceed from an assumption of homo economicus then we are all screwed and you don't appear to be one of those.
Won't that create the perverse incentive to not bother saving for your retirement as you will just lose large sums of it to tax?
Saving is a good thing. It should be incentivised.
They’ll be paying their own transport, pension (and often accommodation & subsistence) out of income taxed at 40% and NI at 25%, and looking for a new job every few months often in a different city.
Rates are going to have to increase dramatically, which will reduce demand for contractors.
Anyone else remember the BBC series "Hustle"?
Their motto was that the first rule of the con was to offer the mark something for nothing, then give them nothing for something.
We're now starting on phase 2.
Secondly, in both that example and in Philip's the much larger difference is the repayment of student loans. When I went to University my fees were paid and I got a grant. I came out of University debt free, dirt poor but ready for the world of work. The real brutality on our young is not an increase in NI, it is the additional tax that they pay in repayment of their student loans that all too often were mis-sold to them on the basis that it was going to give them additional income.
So the money announced today doesn't even cover the crisis funding needed. As Javid said "things will get worse" despite the funding. And then the comedy moment. A cut in the NHS budget to divert this cash to social care. Someone suggested the cash would be freed up as no more Covid. Laughable.
No SofS for Health is going to cut the NHS budget. So this cash will never go to social care. It isn't enough £ to cover the existing NHS cash shortfall. It wouldn't fund social care if the cash ever got there which it won't.
It is more tax for less services. Are you going to vote for it?
It would be much easier if you used the quote function like everyone else
https://www.gov.scot/publications/free-personal-nursing-care-qa/
Not sure about Wales.
I wonder if he reads PB?
(Just a pity the Headline cheapened the content)
Record numbers of 18-year-olds in the UK have accepted university places this year, according to updated figures from the Ucas admissions service.
There will be 272,500 of this age cohort starting at UK universities - up by 7% on last year.
https://www.bbc.co.uk/news/education-58478227
I wonder if that fragility exists in the real world as well, or if it is down to this being a particularly analytical/geeky place that focuses more on the numbers than the story. Boris fixing care storyline does hold up, and if you believe it I can see why people think it might be a good thing. The numbers are both from fantasy land and unfair though.
Therefore my real fear is that in a few years’ time there will not be a visible enough improvement in the care system to justify the claim that this persistent nettle has been effectively grasped. The practical changes that are needed are obvious. We need tens of thousands of extra care workers. We need to ensure that we have the capacity to enable people to receive care in their own homes, so that they have a better quality of life for longer and minimise the huge costs of residential care. We need to build and adapt homes differently, so that people can live for longer without needing 24-hour support. We need more care places, and we need to improve the quality of care.
https://www.conservativehome.com/platform/2021/09/social-care-2-damian-green-one-cheer-at-least-for-this-plan-but-will-the-spending-switch-from-health-to-social-care-ever-happen.html
That's most of it tbh - obviously every VC screeches on about how everyone needs to go.
I thought your point, with which I have some sympathy, is that this additional income should be coming from capital taxes as well as income taxes. I completely agree that the burden of taxes on income is excessive and taxes on capital are far too light. The massive gains people make on their homes tax free is distorting inter generational wealth and opportunity too. But this is a different argument from whether this money is needed. It clearly is.
Does the country want some people in the workforce to
a. want to do the technical work on a temporary basis at short notice with no job security, holiday pay etc.
or
b. want everyone to be directly employed and to move up the career ladder maybe becoming poor managers where they were brilliant engineers?
Not everyone wants a career and the country needs some flexibility in the workforce.
Just as right now there is a perverse incentive not to work and to find ways to get non-employment income instead, and to dodge your taxes if you can.
That's what high taxes does. But if the taxes are moderate but apply to everyone it reduces the perverse incentives it doesn't increase them.
Either the £350m per week / £18.2bn is now being paid to the NHS and things are so bad that we need this extra £12bn as well for services "to get worse" according to Javid.
Or the £18.2bn promised has vanished, hasn't hit the NHS hence the emergency need for funding.
Or, as we know £18.2bn was really £10.4m net. And we're paying around £7bn to the EU this year. So perhaps £3bn available for the NHS. Which it has of course swallowed without trace.
No wonder Dishi wouldn't answer the question from Nick Ferrari this morning.
The problem is this country wants higher government spending than it is willing to pay tax for.
And the country wants to consume more wealth than it is willing to create.
All the service delivery could then be by separate independent organisations within the overall structure
No doubt lots of it will find it's way into Tory chums pockets.
I would argue for a system which taxed beneficiaries in receipt of inheritances at, say, 10% for the first £50k and 20% thereafter. So someone dies with an estate of £1m in property = £195k tax, £805k net inheritance.
At the moment a £1m property can be inherited tax free which IMO is nothing short of obscene.
We do seem to be demonising pensioners who have worked all their lives and put money away from their already taxed income to provide for themselves in retirement.
However - it is doing something, which I feel is better than doing nothing. And we can go to the next election and the parties can tells us what they would do differently, which labour and the lib dems have not done yet (for political reasons I understand, but really if not this, then what?).
Many, many older people's deepest desire is to pass on an inheritance to their kids, often when the kids don't really need it. For me and my sister, if care is needed for our parents, then the house can all go to that if that's what it takes. We are lucky. But for some its a burning need, not just among the wealthy. A colleagues MiL refuses to heat her house because she wants the kids to inherit. Yet my colleague lives in an 850,000 house, with huge pensions already accrued and has no need of the pitiful inheritance it would be. He would rather she heated the house, but she won't.
This may not be the right approach, it may annoy lots of Tory voters, but at least someone has the guts to say we as a society need to pay more.
Most companies have a fixed budget for staff - which will include employer side taxes within the budget. So if next years increase is 2.5% half of that is going to disappear before pay increases are discussed.
When it comes to contractors and temporary staff - the figure used will be a fixed amount per day - so in that case all the extra tax is going to come out of that fixed amount and your typical temporary worker is going to pay all 2.5% of it.