Society
How politics became the preserve of the wealthy
Published 02 April 2007
Two decades on, we can see the poll tax protests as the last great popular uprising - the last occasion when Britain's dispossessed spoke with political force
A few weeks ago, regular readers may recall, I got a headache trying to work out the welfare system. Now I've got another one from grappling with Gordon Brown's Budget. What exactly will the abolition of the 10p income tax band mean for those on the lowest wages, who do not pay enough tax to benefit from the basic-rate reduction to 20p?
The truthful answer is that nobody knows, because the 10p band won't go until April 2009, by which time another two Budgets, presented by a different chancellor, will have been and gone. But the answer wafting out from the Treasury is that losses for the low-paid will be compensated by Working Tax Credit. That appears to be true.
However, you get tax credit only if you fill out the forms to claim it (as many don't, because the forms are too damn complicated, particularly if you are any kind of part-time or freelance worker), and if you are over 25 and work 30 or more hours a week. Even then, you won't get much - possibly less than a fiver a week on the minimum wage - unless you've got dependent children.
According to the Institute for Fiscal Studies, anybody on less than £18,000 a year who doesn't get tax credits will lose from Brown's Budget.
Who cares? Nobody much, judging by how little MPs and the press made of all this. Helping children out of poverty has political traction, and I have nothing but praise for Brown's efforts in this direction.
Yet the income premium on having a child - compared with not having one - is rising all the time for those on welfare or low incomes. If the gap is too wide, and many people in poor communities believe it is, there must be an incentive to childbearing. This is not automatically untrue just because it is said by middle-class women who work for Tory think-tanks. The answer is not to give less to mothers, whether they are in one-parent or two-parent households, but to give more to the impoverished childless - who may well include those desperate young men who mug you on the street, to say nothing of the ones who join the BNP.
So, as in all Brown's Budgets, modest help is given to some, but not all, of the poor, while middle-class fears are put to rest. The inheritance tax threshold will rise to £350,000 by 2010 - which means, with simple, and perfectly legal, tax planning, £700,000 for estates held by couples. The 11 per cent ceiling on National Insurance contributions will also rise, but increasing the 1 per cent rate levied above that (introduced by Brown in 2000) was never on the agenda.
Proposals in a review by Sir Michael Lyons, published on the same day as the Budget, to introduce an upper band of council tax for homes worth more than £2m, and a low band for the cheapest homes, will not be heard of again until at least after the next election.
Nobody expects the Lyons recommendation that property taxes should eventually be based on a fixed percentage of property values to be taken up by anyone, ever. In other words, after 12 years of new Labour (assuming a general election in 2009), we shall still have thousands each year inheriting substantial tax-free fortunes; a personal tax system only slightly more progressive than we had in 1997; and the continuation of a largely regressive property tax. No wonder the fall in inequality has been so modest.
Property-owning franchise
The reasons are spelt out in a new paper for the Compass think-tank ("Polls Apart: democracy in an age of inequality") by Paul Skidmore, a former government adviser now at Princeton University. In the last general election, Skidmore points out, only 54 per cent of those in the lowest social classes voted, against 71 per cent of those in the top classes. That 17 per cent gap has widened from 7 per cent in the 1960s.
The inequality in participation doesn't stop with voting. As Skidmore shows, it also applies to everything from making your voice heard in consultations to signing petitions. The better-off are four times more likely than the least well-off to become school governors or members of such bodies as tenants' committees.
"Politics is increasingly the preserve of the more affluent," writes Skidmore. Just as it was in the days of the property-owning franchise. A determined effort at redistribution, therefore, lacks its most important political constituency: the people who will benefit from it.
Their voices are unheard not only in parliament but at every level of civil society. From the vantage point of nearly two decades on, we can see the poll tax protests as the last great popular uprising, the last occasion when the dispossessed spoke with political force. I fear that those aggrieved by the loss of the 10p band will have to get out on to the streets. Perhaps, in April 2009, they will.
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