How Cameron and Clegg could reach a deal on cutting pensioner benefits

The coalition could pledge to means-test benefits from April 2015 and promise to increase them the previous year to ensure no one is left out of pocket.

With both Labour and the Lib Dems no longer committed to preserving universal benefits for pensioners, what's preventing the Tories executing their own U-turn? The answer is David Cameron's 2010 "read my lips" pledge to protect them (ironically made under pressure from Labour), which was subsequently included in the Coalition Agreement. After seeing the damage inflicted on the Lib Dems by their volte face over tuition fees, Cameron is determined to avoid anything that could provoke claims of betrayal, not least due to the renowned power of the grey vote (the demographic among which UKIP is performing strongest). 

But as Nick Clegg pointed out on The Andrew Marr Show yesterday, the coalition's pledge to "protect key benefits for older people such as the winter fuel allowance, free TV licences, free bus travel, and free eye tests and prescriptions" only applies up to May 2015, while the current Spending Review is concerned with the 2015-16 spending period. The difficulty for Cameron is that six weeks of the period fall before the next general election, meaning any decision to means-test them would technically breach his pledge. As a result, Tory hopes of further welfare cuts, which would allow the government to limit cuts to areas such as policing and defence, have evaporated. As Clegg again stated yesterday, he is only prepared to consider additional cuts (such as the abolition of housing benefit for 25-year-olds and the limiting of child benefit to two children) if the coalition "starts at the top" by curbing benefits for the wealthy. In response, the Tories reaffirmed Cameron's 2010 pledge: "David Cameron promised to protect the benefits for pensioners who've worked hard and done the right thing - and we've kept that promise. Conservatives want to do more to fix the welfare system so that it works for the hard-working people who pay for it."

But with the Treasury still only a third of the way to meeting its Spending Review target of £11.5bn cuts (a total that will be far harder to reach with welfare cuts off the table), it's worth noting one way the coalition could resolve this conundrum. The government could announce that one or more of the benefits will be means-tested from April 2015 and increase payments to pensioners the previous year to ensure no one is left out of pocket. While administratively complex, this would offer the coalition a chance to break the deadlock on welfare. As Philip Hammond, Vince Cable and others battle to protect their departments from the full force of Osborne's axe, it's exactly the kind of imaginative compromise both sides might be tempted to explore. 

Deputy Prime Minister Nick Clegg makes a speech at the G8 Open for Growth - Trade, Tax and Transparency conference at Lancaster House in London. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Air pollution: 5 steps to vanquishing an invisible killer

A new report looks at the economics of air pollution. 

110, 150, 520... These chilling statistics are the number of deaths attributable to particulate air pollution for the cities of Southampton, Nottingham and Birmingham in 2010 respectively. Or how about 40,000 - that is the total number of UK deaths per year that are attributable the combined effects of particulate matter (PM2.5) and Nitrogen Oxides (NOx).

This situation sucks, to say the very least. But while there are no dramatic images to stir up action, these deaths are preventable and we know their cause. Road traffic is the worst culprit. Traffic is responsible for 80 per cent of NOx on high pollution roads, with diesel engines contributing the bulk of the problem.

Now a new report by ResPublica has compiled a list of ways that city councils around the UK can help. The report argues that: “The onus is on cities to create plans that can meet the health and economic challenge within a short time-frame, and identify what they need from national government to do so.”

This is a diplomatic way of saying that current government action on the subject does not go far enough – and that cities must help prod them into gear. That includes poking holes in the government’s proposed plans for new “Clean Air Zones”.

Here are just five of the ways the report suggests letting the light in and the pollution out:

1. Clean up the draft Clean Air Zones framework

Last October, the government set out its draft plans for new Clean Air Zones in the UK’s five most polluted cities, Birmingham, Derby, Leeds, Nottingham and Southampton (excluding London - where other plans are afoot). These zones will charge “polluting” vehicles to enter and can be implemented with varying levels of intensity, with three options that include cars and one that does not.

But the report argues that there is still too much potential for polluters to play dirty with the rules. Car-charging zones must be mandatory for all cities that breach the current EU standards, the report argues (not just the suggested five). Otherwise national operators who own fleets of vehicles could simply relocate outdated buses or taxis to places where they don’t have to pay.  

Different vehicles should fall under the same rules, the report added. Otherwise, taking your car rather than the bus could suddenly seem like the cost-saving option.

2. Vouchers to vouch-safe the project’s success

The government is exploring a scrappage scheme for diesel cars, to help get the worst and oldest polluting vehicles off the road. But as the report points out, blanket scrappage could simply put a whole load of new fossil-fuel cars on the road.

Instead, ResPublica suggests using the revenue from the Clean Air Zone charges, plus hiked vehicle registration fees, to create “Pollution Reduction Vouchers”.

Low-income households with older cars, that would be liable to charging, could then use the vouchers to help secure alternative transport, buy a new and compliant car, or retrofit their existing vehicle with new technology.

3. Extend Vehicle Excise Duty

Vehicle Excise Duty is currently only tiered by how much CO2 pollution a car creates for the first year. After that it becomes a flat rate for all cars under £40,000. The report suggests changing this so that the most polluting vehicles for CO2, NOx and PM2.5 continue to pay higher rates throughout their life span.

For ClientEarth CEO James Thornton, changes to vehicle excise duty are key to moving people onto cleaner modes of transport: “We need a network of clean air zones to keep the most polluting diesel vehicles from the most polluted parts of our towns and cities and incentives such as a targeted scrappage scheme and changes to vehicle excise duty to move people onto cleaner modes of transport.”

4. Repurposed car parks

You would think city bosses would want less cars in the centre of town. But while less cars is good news for oxygen-breathers, it is bad news for city budgets reliant on parking charges. But using car parks to tap into new revenue from property development and joint ventures could help cities reverse this thinking.

5. Prioritise public awareness

Charge zones can be understandably unpopular. In 2008, a referendum in Manchester defeated the idea of congestion charging. So a big effort is needed to raise public awareness of the health crisis our roads have caused. Metro mayors should outline pollution plans in their manifestos, the report suggests. And cities can take advantage of their existing assets. For example in London there are plans to use electronics in the Underground to update travellers on the air pollution levels.

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Change is already in the air. Southampton has used money from the Local Sustainable Travel Fund to run a successful messaging campaign. And in 2011 Nottingham City Council became the first city to implement a Workplace Parking levy – a scheme which has raised £35.3m to help extend its tram system, upgrade the station and purchase electric buses.

But many more “air necessities” are needed before we can forget about pollution’s worry and its strife.  

 

India Bourke is an environment writer and editorial assistant at the New Statesman.