Miliband’s mansion tax retoxifies the Tory brand – and portrays the Lib Dems as helpless hostages

The Tories' opposition to a mansion tax puts them on the wrong side of the new divide in British politics.

George Osborne knows better than most how tax pledges can wrong-foot a government. It was his promise at the 2007 Conservative conference to raise the inheritance-tax threshold to £1m, funded by an annual levy of £25,000 on non-domiciled taxpayers, that spooked Gordon Brown into calling off an early election and earned Osborne his reputation as his party’s sharpest political brain. Labour MPs still wince at the memory of the subsequent “magpie Budget” in which Alistair Darling, under orders from Brown, sought to mimic Osborne’s proposals.

Five and a half years later, it is the Tories who have been blindsided by Labour’s version of Osborne’s gambit. Like the shadow chancellor in 2007, Ed Miliband twinned a popular tax cut (a 10p rate of income tax) with a popular tax rise (a “mansion tax”) and positioned himself on the side of the middle classes. In the Labour camp, there is satisfaction at how the speech has succeeded in defining the pre-Budget terms of debate. It is a sign of Miliband’s enhanced stature that his proposals are now being discussed on the assumption that there is a good chance of them becoming law. The tax pledge has reassured those MPs previously troubled by the party’s lack of emblematic policies. As one frontbencher told me, “It passes the doorstep test.”

It was the Conservative MP Robert Halfon who originally proposed a reintroduced 10p tax rate as an artful piece of Tory detoxification. When I met him in his Commons office the day before Miliband’s speech, he lamented how Labour’s “brilliant” campaign against the abolition of the 50p tax rate had defined the Tories as “a party only interested in cutting taxes for millionaires”. Polling shows that just 9 per cent of the public believe the Conservatives best represent the interests of low-paid public-sector workers, while just 14 per cent believe they best represent their private-sector counterparts. By bringing back the 10p rate on income above the personal allowance and by funding it through the revenue generated by the 45p rate, Halfon argued that the Conservatives could prove that they believed in “tax cuts for the many, not just the few”.

The proposal won the support of key Osborne allies, including his former chief of staff Matthew Hancock, and was earmarked by the Treasury for inclusion in the 2014 Budget. Yet following Miliband’s deft act of political plagiarism, it is now off the table. Unlike Brown in 2007, Osborne has no intention of dancing to the opposition’s tune. Instead, he has sought to give the coalition’s policy of raising the personal allowance a harder edge by branding it as a “zero per cent tax rate”. This, he said, would be “more attractive at an election than a 10 per cent tax rate”. Rather than introducing a new tax band – a measure that would sit uneasily with his commitment to a simplified tax system – Osborne is more likely to seek to increase the personal allowance beyond the original target of £10,000.

A far greater problem than the loss of the 10p tax rate is the coalescing of Labour and the Liberal Democrats around a mansion tax. Of the three main parties, only the Tories now believe that a family in a three-bedroom house in Tower Hamlets should pay the same rate of property tax as an oligarch in a Kensington palace. Those voters who select what James O’Shaughnessy, David Cam­eron’s former director of policy, calls the “dreaded posh family in front of a mansion” when asked to choose the picture that best represents the Tories have had all their prejudices confirmed.

The irony is that it was Osborne – who is now leading the charge against a new property tax – who agreed to introduce two higher council tax bands on houses worth more than £1m ahead of last year’s Autumn Statement before being overruled by Cam­eron. It later emerged that the Tories had surreptitiously written to their wealthy donors soliciting funds to campaign against a “homes tax”, a fact that Miliband gleefully cites as proof that the Prime Minister “stands up for the wrong people”. The Labour leader intends to increase the Tories’ discomfort by using an opposition day debate to force a Commons vote on a mansion tax. In order to maximise the chances of support from Nick Clegg’s party, the motion is not expected to include a reference to the 10p tax rate.

As Miliband hoped, his appropriation of the measure has already forced the Lib Dems into even more aggressive differentiation. Clegg accuses his coalition partners of “turning a blind eye to the super-wealthy” and of defending the interests of “people in very large mansions”. For Labour, such interventions have a dual purpose; they retoxify the Conservative brand while reinforcing the impression of the Lib Dems as the helpless hostages of a Tory clique.

Ever since the Thatcher era, British politics has been governed by the belief that the left won the culture war and the right won the economic war. Yet increasingly it feels as if the reverse is now the case. The left is winning the debate on the need for greater financial regulation and taxation of the wealthy, while the right is winning the debate on the need for a new social conservatism to heal Britain’s “broken society”. In their opposition to a mansion tax, the Tories have positioned themselves on the wrong side of this divide. Until they do otherwise, that picture of the “dreaded posh family” will continue to define them.

Ed Miliband and Swedish Social Democratic leader Stefan Lofven talk after a visit at the Royal Institute of Technology in Stockholm, Sweden. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

This article first appeared in the 25 February 2013 issue of the New Statesman, The cheap food delusion

Photo: Getty
Show Hide image

Hyper-partisan Corbynite websites show how the left can beat the tabloids online

If I were a young Tory looking forward to a long career, I’d be worried.

Despite their best efforts during the election campaign, the Sun, Daily Mail, Telegraph and Express failed to convince voters to give Theresa May a majority, let alone the landslide she craved. Instead, Labour made inroads thanks partly to increased turnout among younger voters who prefer to get their news online and from social networks.

The centre of power in the media has been shifting to the web for years, but during the election we saw just how well a crop of hyper-partisan left-wing news sites are using social media to gain the kind of influence once restricted to the tabloid press.

Writers for sites such as the Canary or Evolve Politics see themselves as activists as much as journalists. That frees them to spin news stories in a way that is highly attuned to the dynamics of social media, provoking strong emotions and allowing them to address their audience like a friend down the pub “telling it how it really is”.

People on Facebook or Twitter use news to tell their friends and the wider world who they are and what they believe in. Sharing the Canary story “Theresa May is trying to override parliamentary democracy to cling to power. But no one’s fooled” is a far more effective signal that you don’t like the Tory government than posting a dry headline about the cancellation of the 2018 Queen’s Speech.

This has long-term implications for the right’s ability to get its message out. Research by BuzzFeed has found that pro-Conservative stories were barely shared during the election campaign. It appears the “shy Tory” factor that skewed opinion polling in previous elections lives on, influencing what people are prepared to post online. If I were a young Tory looking forward to a long career, I’d be worried.

Distorted reality

Television was once the press’s greatest enemy. But its “newspaper reviews” now offer print titles a safe space in which they are treated with a level of respect out of all proportion to their shrinking readership. Surely this must change soon? After all, the Independent sometimes gets a slot (despite having ceased print publication last year) for its digital front page. How is it fair to exclude BuzzFeed News – an organisation that invests in reporting and investigations – and include the Daily Express, with its less-than-prescient weather predictions?

Another problem became apparent during the election. Because the press is so dominated by the right, coverage from the supposedly impartial broadcasters was skewed, as presenters and guests parroted headlines and front-page stories from partisan newspapers. Already, some political programmes, such as BBC1’s The Andrew Marr Show, have experimented with including news from outside Fleet Street. One of the newspaper industry’s most reliable allies is looking for new friends.

Alternative facts

The rise of sites spreading the left-wing gospel across Facebook may be good for Labour but that doesn’t mean it’s good for the public. This was illustrated on 16 June in a post by a relatively new entrant called the Skwawkbox, which claimed that a government “D-notice” – now called a DSMA-notice – might be in place restricting news organisations from reporting on the number of casualties from the Grenfell Tower fire.

The claim was untrue and eventually an update was added to the post, but not before it was widely shared. The man behind the blog (who gives his name in interviews only as “Steve”) insisted that because he had included a couple of caveats, including the word “if” in the text of his article, he was justified in spreading an unsubstantiated rumour. Replacing an irresponsible right-wing tabloid culture in print with equally negligent left-wing news sites online doesn’t feel much like progress.

Blood and bias

Narratives about the corrupt, lying mainstream media (the “MSM” for short) have become more prevalent during the election, and it’s clear they often hit a nerve.

On 17 June, a protest over Theresa May’s deal with the DUP and the Grenfell Tower fire made its way past BBC Broadcasting House, where a small group stopped to chant: “Blood, blood, blood on your hands!” Hours later, in the shadow of the burned-out tower, I heard a young woman complain loudly to her friends about money being used to fly BBC news helicopters when it could have gone to displaced victims.

The BBC cites the accusations of bias it receives from both ends of the political spectrum as evidence that it is resolutely centrist. But while many of its greatest critics would miss the BBC if it goes, the corporation could do a better job of convincing people why it’s worth keeping around.

Grenfell grievances

Early reports of the attack on a Muslim crowd in Finsbury Park on 19 June exhibited a predictably depressing double standard. The perpetrator was a “lone wolf”, and the Mail identified him as “clean-shaven”: phrases it is hard to imagine being used about an Islamist. Yet the media don’t just demonise Muslims in its reporting; they also marginalise them. Coverage of Grenfell contained plenty of references to the churches in this part of west London and its historic black community. Yet Muslims and the relief work carried out by local mosques received comparatively little coverage. Community issues such as Islam’s requirement that the dead are buried swiftly were largely ignored, even though a large number of those killed or made homeless by the fire were Muslim.

I suspect this may have something to do with outdated ideas of what north Kensington is like. But it also must reflect the reality that just 0.4 per cent of UK journalists are Muslim, according to a study by City University in London. The lack of diversity in the media isn’t just a moral issue; it’s one that affects our ability to tell the full story.

This article first appeared in the 22 June 2017 issue of the New Statesman, The zombie PM

0800 7318496