Farewell to Hindenburgplatz

A referendum in a German town over a street name sparks a debate over whether ambiguous historical figures should be honoured.

The city of Munster-Westphalia in northern Germany held a local referendum last week about renaming a central square outside the old Prince-Bishops Palace. The vote went in favour of the prosaic name Schlossplatz or Palace Square but not without first creating an energetic display of local democracy in action.

National referendums in Germany are prohibited by the German constitution for fear that they are a tool of demagogues, as of course they were in the 1930s. However, referendums on local issues are allowed - a planned vote on spending €3bn on a maglev line to Munich Airport in 2008 was key to the cancellation of that project. Munster’s vote, however, was on the more parochial issue of a street name.

The large central square outside the baroque Prince-Bishops Palace had been renamed Hindenburgplatz in 1927 in honour of the First World War general and then Weimar President Paul von Hindenburg. With the Palace now occupied by the main buildings of the prestigious Munster University, the square being the end point for annual marathon and the site of fairs this address was now proving an embarrassment.

The political initiative to rename it, however, could not be taken by the left, in case of cries of political correctness. Instead it was the Christian Democrat mayor who announced the renaming in March 2012, choosing the bland but accurate Schlossplatz (rather than reverting to the now out-of-date name it had held since the 1700s of Neuplatz or New Square). He got overwhelming backing from all but his own party in the city council.

Immediately the renaming caused consternation amongst the more traditionally minded citizens. They raised the signatures required to petition for a referendum and hence last week’s vote.

Having raised a stir many presumed that the "Yes" campaign to reinstate the name Hindenburgplatz would easily win. It is only a street and only those who had got worked up by the renaming would bother to vote; so Hindenburgplatz would win overwhelmingly on a low turnout. The three previous referendums in Munster, which also asked citizens to vote to overturn council decisions, had all gone this way.

The "Yes" campaign, however, soon found itself in a double-bind. Acknowledging that all historical figures are ambiguous it focused on the name now being part of the city’s history and on the mayor’s lack of consultation with citizens. But the issue soon focussed on the character of President Hindenburg. A large "No" campaign supporting the council’s decision emerged with the slogan: “For democracy, Hindenburg had no place. We have no place for him”. Moreover the "No" campaign pointed out that the issue had got national attention; to re-honour Hindenburg would embarrass the city and give succour to neo-nazis, who may choose the city as a new base. The local newspaper the Westfalische Nachrichten stated in an editorial that they could have let the issue rest but once the process to remove the name Hindenburgplatz had started it had to continue.

With the SPD, FDP, Greens and Left along with the CDU mayor and the city’s CDU MP all favouring Schlossplatz when the vote came it went "Yes" 41 per cent and "No" 59 per cent with a higher than normal turnout of over 40 per cent. As one resident said “It was the correct result but I’ll still always think of it as Hindenburgplatz”.

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Q&A: What are tax credits and how do they work?

All you need to know about the government's plan to cut tax credits.

What are tax credits?

Tax credits are payments made regularly by the state into bank accounts to support families with children, or those who are in low-paid jobs. There are two types of tax credit: the working tax credit and the child tax credit.

What are they for?

To redistribute income to those less able to get by, or to provide for their children, on what they earn.

Are they similar to tax relief?

No. They don’t have much to do with tax. They’re more of a welfare thing. You don’t need to be a taxpayer to receive tax credits. It’s just that, unlike other benefits, they are based on the tax year and paid via the tax office.

Who is eligible?

Anyone aged over 16 (for child tax credits) and over 25 (for working tax credits) who normally lives in the UK can apply for them, depending on their income, the hours they work, whether they have a disability, and whether they pay for childcare.

What are their circumstances?

The more you earn, the less you are likely to receive. Single claimants must work at least 16 hours a week. Let’s take a full-time worker: if you work at least 30 hours a week, you are generally eligible for working tax credits if you earn less than £13,253 a year (if you’re single and don’t have children), or less than £18,023 (jointly as part of a couple without children but working at least 30 hours a week).

And for families?

A family with children and an income below about £32,200 can claim child tax credit. It used to be that the more children you have, the more you are eligible to receive – but George Osborne in his most recent Budget has limited child tax credit to two children.

How much money do you receive?

Again, this depends on your circumstances. The basic payment for a single claimant, or a joint claim by a couple, of working tax credits is £1,940 for the tax year. You can then receive extra, depending on your circumstances. For example, single parents can receive up to an additional £2,010, on top of the basic £1,940 payment; people who work more than 30 hours a week can receive up to an extra £810; and disabled workers up to £2,970. The average award of tax credit is £6,340 per year. Child tax credit claimants get £545 per year as a flat payment, plus £2,780 per child.

How many people claim tax credits?

About 4.5m people – the vast majority of these people (around 4m) have children.

How much does it cost the taxpayer?

The estimation is that they will cost the government £30bn in April 2015/16. That’s around 14 per cent of the £220bn welfare budget, which the Tories have pledged to cut by £12bn.

Who introduced this system?

New Labour. Gordon Brown, when he was Chancellor, developed tax credits in his first term. The system as we know it was established in April 2003.

Why did they do this?

To lift working people out of poverty, and to remove the disincentives to work believed to have been inculcated by welfare. The tax credit system made it more attractive for people depending on benefits to work, and gave those in low-paid jobs a helping hand.

Did it work?

Yes. Tax credits’ biggest achievement was lifting a record number of children out of poverty since the war. The proportion of children living below the poverty line fell from 35 per cent in 1998/9 to 19 per cent in 2012/13.

So what’s the problem?

Well, it’s a bit of a weird system in that it lets companies pay wages that are too low to live on without the state supplementing them. Many also criticise tax credits for allowing the minimum wage – also brought in by New Labour – to stagnate (ie. not keep up with the rate of inflation). David Cameron has called the system of taxing low earners and then handing them some money back via tax credits a “ridiculous merry-go-round”.

Then it’s a good thing to scrap them?

It would be fine if all those low earners and families struggling to get by would be given support in place of tax credits – a living wage, for example.

And that’s why the Tories are introducing a living wage...

That’s what they call it. But it’s not. The Chancellor announced in his most recent Budget a new minimum wage of £7.20 an hour for over-25s, rising to £9 by 2020. He called this the “national living wage” – it’s not, because the current living wage (which is calculated by the Living Wage Foundation, and currently non-compulsory) is already £9.15 in London and £7.85 in the rest of the country.

Will people be better off?

No. Quite the reverse. The IFS has said this slightly higher national minimum wage will not compensate working families who will be subjected to tax credit cuts; it is arithmetically impossible. The IFS director, Paul Johnson, commented: “Unequivocally, tax credit recipients in work will be made worse off by the measures in the Budget on average.” It has been calculated that 3.2m low-paid workers will have their pay packets cut by an average of £1,350 a year.

Could the government change its policy to avoid this?

The Prime Minister and his frontbenchers have been pretty stubborn about pushing on with the plan. In spite of criticism from all angles – the IFS, campaigners, Labour, The Sun – Cameron has ruled out a review of the policy in the Autumn Statement, which is on 25 November. But there is an alternative. The chair of parliament’s Work & Pensions Select Committee and Labour MP Frank Field has proposed what he calls a “cost neutral” tweak to the tax credit cuts.

How would this alternative work?

Currently, if your income is less than £6,420, you will receive the maximum amount of tax credits. That threshold is called the gross income threshold. Field wants to introduce a second gross income threshold of £13,100 (what you earn if you work 35 hours a week on minimum wage). Those earning a salary between those two thresholds would have their tax credits reduced at a slower rate on whatever they earn above £6,420 up to £13,100. The percentage of what you earn above the basic threshold that is deducted from your tax credits is called the taper rate, and it is currently at 41 per cent. In contrast to this plan, the Tories want to halve the income threshold to £3,850 a year and increase the taper rate to 48 per cent once you hit that threshold, which basically means you lose more tax credits, faster, the more you earn.

When will the tax credit cuts come in?

They will be imposed from April next year, barring a u-turn.

Anoosh Chakelian is deputy web editor at the New Statesman.