Commons Confidential: Is Boris heading for a seat in Kensington?

PLUS: Why Bob Crow turned down <em>Big Brother</em>.

Most Tory MPs I’ve spoken to expect Boris Johnson to break another promise and stand in a safe Tory seat at the May 2015 election, doubling for a year as Mayor of London. Parliament would be his entry ticket to the Conservative leadership raffle, should the blond ambition’s Buller junior David Cameron lose at the polls. A place in cabinet would be Johnson’s consolation prize should – splutter, ruffles hair, crikey! –Dave triumph. Johnson must find, of course, a desirable Tory constituency. Noblesse oblige is likely to see another Old Etonian, Frank “Zac” Goldsmith, seek a second term in Richmond Park. The gossip on the House of Commons terrace before MPs went on their hols was of Johnson popping up in Kensington. It’s in London, posh, rock-solid Tory; the sitting tenant, Sir Malcolm Rifkind, will be nudging 69 next time. And the local worthies value flamboyance: Alan Clark and Michael Portillo were among the past picks. We’ll see.
Labour MPs have taken to calling their leader’s youthful team “Ed’s crèche”, as the fallout over ending not mending (or was it the other way round?) union links continues. The trade union group of MPs, the party’s biggest backbench group, if hitherto a sleeping giant, is to re-form in the autumn. The draft statement of aims prizes Labour’s industrial ties, a direction of travel likely to have Miliband reaching for the antihistamines.
I discovered that the hapless Tory Aidan Burley –dumped as a parliamentary aide over a Nazi-themed stag do before dismissing Danny Boyle’s widely applauded Olympic opening ceremony as “lefty multicultural crap” – has quietly left the all-party work and pensions committee. I’m not surprised. A stentorian Glenda Jackson took a dislike to Burley, dismissing the underling with Oscar-winning contempt. Young Burley was well and truly Glenda’d.
Labour spent £6.54 for each vote won in the South Shields by-election by the victorious local lass Emma Lewell-Buck. The Shields Gazette calculated that Ukip’s second place cost it £7.97 a vote, with the Cons, a poor third, shelling out a mere £1.85 a throw. The biggest losers were the Lib Dems, each cross on a ballot paper for the yellow peril a cofferemptying £17.91 – with an embarrassing seventh place in return. Austerity doesn’t start at home for Nick Clegg.
Bob Crow the cockney express, Britain’s most recognisable trade union general secretary, turned down Big Brother. The railway workers’ leader rejected a large wad of notes waved in front of his nose to entice him into the TV madhouse. I for one can’t see Crowbar in a Lycra catsuit.
This column is taking its annual summer break and will be back the week before the TUC kicks off the political conference season.
Kevin Maguire is the associate editor (politics) of the Daily Mirror 
A seat in Kensington would be Boris's entry to the Conservative leadership raffle. Photograph: Getty Images

Kevin Maguire is Associate Editor (Politics) on the Daily Mirror and author of our Commons Confidential column on the high politics and low life in Westminster. An award-winning journalist, he is in frequent demand on television and radio and co-authored a book on great parliamentary scandals. He was formerly Chief Reporter on the Guardian and Labour Correspondent on the Daily Telegraph.

This article first appeared in the 29 July 2013 issue of the New Statesman, Summer Double Issue

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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.