Saturday, November 14, 2009

Childcare Vouchers and means testing mania

Many years ago I heard Frank Field MP speak, and one of the themes of his speech was the evil of means testing for benefits. His view was that this created benefits traps, with huge marginal rates of tax if people tried to improve their situation, and discouraged thrift. In fact means tested benefits as they operate today mean that it makes economic sense for the poor to stay poor, because increases in income or the accumulation of assets are punished by the withdrawal of means-tested benefits. Unfortunately, Labour under Brown are obsessed with means testing, which is one reason social mobility has decreased under the current government. Despite this, Gordon Brown's latest brainwave is to replace the current system of tax relief for childcare vouchers with, you guessed it, means testing. The argument is that too many people who can afford to pay for childcare are benefitting from tax relief. So, a system that works well is to be replaced by one that gives people an incentive to stay poor. That is even if they take up the benefit at all, becaue means-tested benefits have a much worse take-up rate than universal benefits.

Of course, there is also a political dimension because with an election coming up quite a few Labour MPs have worked out that withrawing childcare tax relief won't be, well, popular. There is already a large online petition against the move and dozens of Labour MPs have stated their oppositon to Brown's policy. These do not include one of our local MPs though. Angela Smith has been in the local papers telling us what a good idea it all is. She is Brown's PPS after all, so not much choice there.

Monday, November 09, 2009

Nuclear power? Yes please!

Finally the government has accepted that the UK needs new nuclear power stations. These are zero carbon and there is enough uranium in the world to power human civilisation for at least a thousand year. The trouble is that it is all a bit late. Power stations take quite a while to build and the best estimates are that as old power stations are decommissioned our country will have power cuts unitl the new capacity is online. Labour have fought shy of nuclear power for years in the vain hope that renewables could fill the gap. This might have been reasonable a decade ago, but it has been obvious for years that the majority of the nation's power would have to found elsewhere. It is only now that even large sections of green movement have come round to a pro-nuclear view that Labour have got off the fence. Meanwhile, other countries haven't been sitting about and our long-term competitiveness is now under threat. Just one more Labour screwup...

Brown blunders on condolence letter

Top of Sky News this morning was the poor bereaved mother of a soldier who has fallen in the Afghan war. She received a letter of condolence from Gordon Brown that got her surname wrong and was littered with misspellings. She was distraught at the loss of her son, her boy, her baby, speaking with a grief that was truly heart-rending. There was also bitterness that all he amounted to from no.10 was a scrawled letter that would not have passed muster from a 10 year-old.

Gordon Brown has bad eyesight and apparently his handwriting isn't very good, and you have to give him some credit for doing the letters himself when he could so easily delegate that painful task. For something like this though excuses will not do. A letter like that has to be right. It is not just his fault though. His private office should have made sure they got the soldier's name right at least, and someone should have had the guts to tell him that the letter simply wasn't good enough.