Voters want Cameron to come clean on the 50p tax cut

Sixty two per cent of voters want the PM to say whether he will benefit from the abolition of the 50p tax rate, private polling by Labour shows.

On the eve of the Labour conference, the Conservatives sought to unsettle Ed Miliband by releasing private polling showing that most voters believed David Miliband would have made a better leader and that Miliband lacked the qualities required of a prime minister. Now, as the Tories head to Birmingham for their annual gathering, Labour has released its own mischevious poll.

After Miliband alleged in his conference speech that David Cameron would receive the "millionaire’s tax cut", a private poll for the party by ICM (sample size: 2,009) has shown that a majority of voters want Cameron to say whether he will benefit from the abolition of the 50p rate. Asked whether the Prime Minister should "come clean and tell people honestly whether he is personally benefitting from this" or whether it was "a matter only for him", 62% said the former and 22% the latter. Among Conservative voters, 46% wanted Cameron to "come clean", while 40% agreed it was a private matter.

Aware of how much damage the Tories inflicted on Ken Livingstone over his tax arrangements (and with an eye to how the Obama campaign forced Mitt Romney onto the defensive over his tax bill), Labour is out for revenge. Miliband used the final PMQs before the conference season to challenge Cameron on whether he would benefit from the 50p tax cut, describing it as "a question he would have to answer between now and April" (when the tax cut is formally introduced). Cameron has so far refused to give an answer (unlike George Osborne, who said he would not benefit from the move) and, under ever-greater pressure from Labour, the Tories will need to decide whether this strategy is sustainable.

The poll also reminds us just how unpopular the decision to abolish the top rate is. The survey, conducted on Wednesday and Thursday this week, found that 71% of voters think the coalition should abandon the tax cut. Asked whether, "with government borrowing coming in higher than expected", the government should "cancel plans to cut tax for people on £150,000 a year", 45% strongly agreed it should, while 25% somewhat agreed. Seven per cent strongly disagreed that it should and 10% somewhat disagreed. By 65% to 26%, Conservative voters also opposed the tax cut going ahead. 

Were this not a private poll, it's unlikely that the question would have appeared in that form ("with government borrowing coming in higher than expected" is designed to lead voters to the desired answer) but it's worth remembering that previous polls have shown widespread opposition to the abolition of the 50p rate. An ICM survey for the Guardian in March found that 67% of voters wanted to keep the top rate. More than any other single measure, it was the abolition of the 50p rate, juxtaposed with tax rises on pensioners, pasties, caravans, churches and charities, that retoxified the Tory brand.

Sixty two per cent of voters said Cameron should "tell people honestly whether he is personally benefitting from this". Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Debunking Boris Johnson's claim that energy bills will be lower if we leave the EU

Why the Brexiteers' energy policy is less power to the people and more electric shock.

Boris Johnson and Michael Gove have promised that they will end VAT on domestic energy bills if the country votes to leave in the EU referendum. This would save Britain £2bn, or "over £60" per household, they claimed in The Sun this morning.

They are right that this is not something that could be done without leaving the Union. But is such a promise responsible? Might Brexit in fact cost us much more in increased energy bills than an end to VAT could ever hope to save? Quite probably.

Let’s do the maths...

In 2014, the latest year for which figures are available, the UK imported 46 per cent of our total energy supply. Over 20 other countries helped us keep our lights on, from Russian coal to Norwegian gas. And according to Energy Secretary Amber Rudd, this trend is only set to continue (regardless of the potential for domestic fracking), thanks to our declining reserves of North Sea gas and oil.


Click to enlarge.

The reliance on imports makes the UK highly vulnerable to fluctuations in the value of the pound: the lower its value, the more we have to pay for anything we import. This is a situation that could spell disaster in the case of a Brexit, with the Treasury estimating that a vote to leave could cause the pound to fall by 12 per cent.

So what does this mean for our energy bills? According to December’s figures from the Office of National Statistics, the average UK household spends £25.80 a week on gas, electricity and other fuels, which adds up to £35.7bn a year across the UK. And if roughly 45 per cent (£16.4bn) of that amount is based on imports, then a devaluation of the pound could cause their cost to rise 12 per cent – to £18.4bn.

This would represent a 5.6 per cent increase in our total spending on domestic energy, bringing the annual cost up to £37.7bn, and resulting in a £75 a year rise per average household. That’s £11 more than the Brexiteers have promised removing VAT would reduce bills by. 

This is a rough estimate – and adjustments would have to be made to account for the varying exchange rates of the countries we trade with, as well as the proportion of the energy imports that are allocated to domestic use – but it makes a start at holding Johnson and Gove’s latest figures to account.

Here are five other ways in which leaving the EU could risk soaring energy prices:

We would have less control over EU energy policy

A new report from Chatham House argues that the deeply integrated nature of the UK’s energy system means that we couldn’t simply switch-off the  relationship with the EU. “It would be neither possible nor desirable to ‘unplug’ the UK from Europe’s energy networks,” they argue. “A degree of continued adherence to EU market, environmental and governance rules would be inevitable.”

Exclusion from Europe’s Internal Energy Market could have a long-term negative impact

Secretary of State for Energy and Climate Change Amber Rudd said that a Brexit was likely to produce an “electric shock” for UK energy customers – with costs spiralling upwards “by at least half a billion pounds a year”. This claim was based on Vivid Economic’s report for the National Grid, which warned that if Britain was excluded from the IEM, the potential impact “could be up to £500m per year by the early 2020s”.

Brexit could make our energy supply less secure

Rudd has also stressed  the risks to energy security that a vote to Leave could entail. In a speech made last Thursday, she pointed her finger particularly in the direction of Vladamir Putin and his ability to bloc gas supplies to the UK: “As a bloc of 500 million people we have the power to force Putin’s hand. We can coordinate our response to a crisis.”

It could also choke investment into British energy infrastructure

£45bn was invested in Britain’s energy system from elsewhere in the EU in 2014. But the German industrial conglomerate Siemens, who makes hundreds of the turbines used the UK’s offshore windfarms, has warned that Brexit “could make the UK a less attractive place to do business”.

Petrol costs would also rise

The AA has warned that leaving the EU could cause petrol prices to rise by as much 19p a litre. That’s an extra £10 every time you fill up the family car. More cautious estimates, such as that from the RAC, still see pump prices rising by £2 per tank.

The EU is an invaluable ally in the fight against Climate Change

At a speech at a solar farm in Lincolnshire last Friday, Jeremy Corbyn argued that the need for co-orinated energy policy is now greater than ever “Climate change is one of the greatest fights of our generation and, at a time when the Government has scrapped funding for green projects, it is vital that we remain in the EU so we can keep accessing valuable funding streams to protect our environment.”

Corbyn’s statement builds upon those made by Green Party MEP, Keith Taylor, whose consultations with research groups have stressed the importance of maintaining the EU’s energy efficiency directive: “Outside the EU, the government’s zeal for deregulation will put a kibosh on the progress made on energy efficiency in Britain.”

India Bourke is the New Statesman's editorial assistant.