Ignoble reactions to the Nobel Peace Prize

Not everyone is pleased Liu Xiaobo is this year's laureate

The decision to award the Nobel Peace Prize to the Chinese dissident Liu Xiaobo was obviously not going to go down well with Beijing. It is intriguing to note, however, the reaction in China itself and that in the neighbouring region.

Clifford Coonan reports in today's Independent that "many Chinese see it as yet another attack on China, embodying what they see as sour grapes in the West about China's startling economic rise and a lack of understanding of how the country works." He also points to criticism from Wei Jingsheng, a pro-democracy activist imprisoned for two decades and now in exile in the US. "In my observation, the Nobel Peace Prize is going to Liu because he is different from the majority of people in opposition. He made more gestures of cooperation with the government and made more criticism of other resisters who suffered," Wei told the AFP news agency.

About the strongest local criticism of the award so far has come from Singapore, from one of the city-state's most prominent former diplomats, currently Dean of the Lee Kuan Yew School of Public Policy at the National University of Singapore, Kishore Mahbubani. I'm indebted to Asia Sentinel for picking up the following remarks he made at a dinner last Friday:

"We all respect the Nobel Peace Prize. Most winners deserve the prizes they get. Nobel Prizes by and large reflect the western world view. The winners in Asia are never leaders who brought great change. The man that did more good than anyone was Deng Xiaoping. When he came to power 800 million people were living on less than one dollar a day. Thirty years later on after the results of his reforms, 200 million lived on less than one dollar a day. Six hundred million people were lifted out of poverty.

Will he ever get a Nobel Peace Prize? Never. Because of the western world view that the prize must be given to dissidents in Asia. Aung San Suu Kyii (although she deserves it). The former leader of Korea. What has Obama brought? Where is the peace in Iraq? In Afghanistan? How can you give him a Nobel Peace Prize? He is a wonderful guy but he has achieved nothing. Deng Xiaoping saved 600 million people and he will never get a Nobel Peace Prize. That's why it is important to step outside the western world view."

Mahbubani conveniently omits to mention the matter of the Tiananmen Square massacre in 1989. If it were possible to leave that aside, then a strong case for Deng's period of office could be made. But it isn't, which makes the suggestion grotesque and gratuitously offensive. Also on Asia Sentinel, the International Herald Tribune columnist and former Far Eastern Economic Review editor, Philip Bowring, puts Mahbubani smartly right, calling his comments about dissidents "just the sort of half-truth that one expects from Singapore apologists for authoritarian regimes similar to their own. It also reflects Singapore's attempts to appear ultra-Asian while aligning its economic and strategic interests with the west."

However, even if he represents an extreme end of the spectrum, Mahbubani will not be alone in his view of how this year's Nobel Peace Laureate was chosen. President Obama and representatives of EU countries, including Britain and France, have welcomed the award, as have the governments of New Zealand and Australia - which as Asia-Pacific countries have a much more direct interest in good relations with China.

But from the leaders of the ten nation ASEAN bloc bordering China, I can find no evidence of congratulations to Liu - nor even any statement in which he is named. Just silence.

An example of a rather ignoble pragmatism? Tacit sympathy with those "Asian Values" of which Mahbubani is just one exponent (Malaysia's former prime minister Mahathir or Singapore's Minister Mentor Lee being two others)? Perhaps. Or maybe with their own less-than-perfect human rights records, they prefer not to laud those who might well have ended up in jail in their countries too.

Sholto Byrnes is a Contributing Editor to the New Statesman
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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.