Childhood, BA strikes and biscuits

Nobody should blame Denise Fergus, mother of the late James Bulger, for making comments that seem foolish and ignorant. Even if she were not being goaded by a rabble-rousing press, her instinct for vengeance is perfectly natural. So is her loathing for those such as the Children's Commissioner, Maggie Atkinson, who propose that the ten-year-old killers of her child shouldn't have been tried in an adult court. Fergus feels that if she fails to support the harshest punishments, she dishonours her son's memory. That is why we have a justice system that balances the retribution demanded by victims against mercy, the hope of redemption and a large dose of common sense.

And common sense surely dictates that Atkinson is right: the age of criminal responsibility should be at least 12. Most parents do not treat ten-year-olds as responsible adults. They do not allow them to walk around town unaccompanied, stay alone at home, hold unsupervised parties, play with matches or take sole charge of younger children. The statute book - on subjects from alcohol to paid employment - is full of laws that regard young people as impressionable, irresponsible and vulnerable until they are much older than 12.

Far from applying this common sense to criminal acts, we (or at least the popular newspapers) take the opposite view: that children who commit murder are in some unexplained sense more culpable, more evil, than adults guilty of the same crime. Despite Lord of the Flies, A High Wind in Jamaica and other literary warnings, we cling to the romantic illusion that the natural state of childhood is one of innocence. We wish to punish Jon Venables and Robert Thompson for shattering that illusion.

Crew cuts

British Airways cabin crew do not generally look like members of the oppressed, impoverished, alienated masses and I accept a case can be made that their strike is greedy, selfish, uncaring and blinkered, and "against the public interest" (whatever that means). But I see no moral distinction between their actions and those of bankers who pocket giant bonuses, high earners who move to foreign parts to escape 50p tax and "public servants" or "captains of industry" who award themselves pay rises well above anything the workers get.

We are told millions of other British workers have accepted pay freezes and even cuts. This is most likely because they are weak, unorganised or fearful for their jobs, not because they are mindful of the "public interest". Nobody, in any case, will show an ounce of gratitude for public-spirited behaviour. In the late 1970s, unions delivered to a Labour government such pay restraint that, in a period of high inflation, the average worker's purchasing power fell 7 per cent in two years. The workers' reward was public odium - followed by 18 years of relentless anti-union Tory legislation - for trying to return to normal pay bargaining.

Gordon Senate

We should, I suppose, wait to see the detail of Labour's proposals for House of Lords reform before denouncing them. But reports so far suggest the new "Senate" will be elected by proportional representation on the "party list" system. In other words, voters still won't be able to choose individual members; they will be presented with alternative "slates", selected by the party machines, as in elections for the European Parliament. No prizes for guessing the kind of names that will appear. The proposed Senate sounds suspiciously like the present House of Lords (minus the bishops and the rump of hereditary peers) but with spurious claims to democratic legitimacy.

HobNobs, not hobnobbing

Ed Miliband, the Energy and Climate Change Secretary, may have ignored my calls for a principled resignation, but it is reassuring to know that during a weekend meeting at his home to draft the Labour manifesto, as first reported by James Macintyre in these pages, ministers and advisers subsisted on HobNobs and mugs of tea. I am confident that, had bacon butties or toasted ciabatta been served, the spin doctors would have kept it quiet. Modern politicians must be seen to eat déclassé food that is neither too proletarian nor too fancily metropolitan. So, from Andrew Rawnsley's latest book, we discover that Tony Blair celebrated the 2005 general election victory with a bacon, lettuce and tomato sandwich.

Now that it is impossible to distinguish between the parties' policies - or to make any sense of them at all in most cases - we need all the information we can get about their leaders' eating habits. Asked by a schoolchild to name his favourite food, Gordon Brown mentioned steak, spaghetti bolognese, carbonara "and all these things" and then concluded: "I like Chinese food, Indian food, I like English food, British food . . . I like . . . French food . . . I like almost everything." This strikes me as a near-perfect example of the New Labour approach. Equally, David Cameron's "favourite dish" - slow-roast shoulder of lamb from a recipe by Jamie Oliver - seems a touch too contrived.

Tory wives

Much worse, however, was Cameron's revelation during his interview with Trevor McDonald that he was introduced to his wife by his sister. His spin doctors don't understand that this betrays irredeemable poshness. For generations, English upper-class males habitually married either cousins or girls introduced by their sisters. Because they attended single-sex boarding schools, followed by largely single-sex universities and professions or single-sex armed services, they rarely met women outside the family and had no idea how to approach them unless "introduced". That Cameron conforms to this tradition is far more damning than his having gone to Eton.

Peter Wilby was editor of the New Statesman from 1998-2005

Peter Wilby was editor of the Independent on Sunday from 1995 to 1996 and of the New Statesman from 1998 to 2005. He writes the weekly First Thoughts column for the NS.

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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.