Nick Clegg and David Cameron. Photo: Getty
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Will these professionally beige career politicians ever understand public service?

Despite grand promises, the coalition has not found a new way forward, nor has it overseen a resurgence of democratic engagement.

History tells us that in times of austerity, the poor and vulnerable are easy targets for those seeking to divide and weaken society. Benefit Bashing appears to be a new national sport, and this is a direct result of the death of the conviction politician, and the readiness of careerist MPs to dance to the tune of press barons in the hope of currying favourable electoral coverage. The ordinary voter is no longer the lynchpin, and press barons have seized the power our elected representatives have so readily ceded, now acting as king maker. Consequently, it’s now okay to making sweeping generalisations against huge swathes of people suffering deeply at the hands of a government composed of morally myopic, finger wagging millionaires, while ignoring harsh realities of how those government policies embed poverty and inexorably entrench class divides. The truth is no more than an inconvenience to be misreported or ignored. The fact that the media have shown more interest in where Bob Crow sunbathed on holiday, than the fact that 1 in 7 schoolchildren will endure a winter without a suitable coat says it all.

The untimely demise of Bob and Tony Benn could not have come at a worse time. The attacks on the working poor, vulnerable and disabled are not only coming from predictable government and media sources, but also from Labour. Both men were conviction politicians, routinely castigated for their views on most subjects, and in a minority of left wing advocates who managed to achieve broad media presence, speaking up for those with no voice, railing against casualisation of employment, and crusading against the excesses of a broken political system. They both passionately espoused radical socialist democracy, similar to the post war Labour administration that introduced universal health care, widespread pensions, expansive house building and full employment, but  were ultimately deserted by New Labour, as the party engaged in a limp wristed arm wrestle for what certain media outlets decided was the centre ground. It is the embedded fear held by political leaders of press barons, and a complete lack of political voices of conviction and passion, willing to defend the working poor and vulnerable that has opened the door to such flagrant collective character assassinations of benefit claimants, the like of which we have not seen since the darkest days of Margaret Thatcher.

Back in 2010, I remember discussing the prospect of coalition with many who saw alliance between Conservatives and Liberal Democrats as a necessary evil, as well as being symptomatic of that broken system. In the infancy of this parliament, sun-kissed press conferences told us how new politics would establish new economic balance, the intoxicating melody of false hope weaving its thread through the sweet fabric of those summer afternoons, atop hypnotic drumbeats of blame aimed squarely and repeatedly at the previous administration. Four years later, the coalition is not so much necessary evil as it is a political infection that has been encouraged and cultivated by the collusion of a rudderless Labour Party, and the enthusiastic applauding of the more unedifying elements of the right wing press. Like any infection of virulence that goes unchallenged, it grew in size and severity, morphing from the Coalition of the Willing, into a Coalition of Haters.

Despite grand promises, the coalition has not found a new way forward, nor has it overseen a resurgence of democratic engagement. It has overseen the legitimising of repeated smears and attacks from government and massed media aimed squarely at those least able to defend themselves. It has overseen swathes of the legal aid system becoming virtually inaccessible for the working poor and vulnerable. It has overseen the bedroom tax continuing to wreak havoc among the most disadvantaged families, and employment rights and job security sacrificed with impunity. It has overseen the very poorest among us looking on helplessly while foreign nationals and bankers massage their tax burdens via London property acquisitions, with the working poor languishing on poverty pay in part time work, on zero hours contracts, or subsidising the profits of wealthy multinationals through workfare placements.  

We must take some blame for this. We buy these papers, and we recycle these lies. We need to stop subsidising this horror show. We need politicians unafraid of voicing opinion, men and women of conviction and passion willing to stand up for the poorest and most vulnerable, because those on benefits should never be column fodder for wealthy press barons. We need more Bob Crows and Tony Benns. They are the bulwark against the race to the bottom, and the worst instincts of a feckless coalition. They are a reminder that we must continue to oppose injustice and cruelty, and are an example to every professionally beige career politician of what it means to engage in public service.


Karl Davis is a writer, stand up comedian, train driver, and trade union activist and advocate. He lives in Hull and is married with two young sons.

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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.