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Politics

Cameron’s hamstrung Exchequer

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Pledges cost money: David Cameron’s hamstrung Exchequer

THE NATIONAL tabloids are often full of foaming at the mouth headlines about ‘scroungers’, stories about ‘dole fiddlers’, and tales expressing horror that some people pretend to be ill to get disability benefits.

That is nothing new and it is conspicuous that there is a spike in such stories (particularly involving those from outside the UK) when governments of whatever complexion have announced ‘welfare reform’ (cuts) ‘designed to deliver to those most in need’ (not those in most in need).

WHERE THE MONEY GOES: PENSIONS

Welfare spending makes up around 35% of the UK Government’s spending and totals over £260b per year. However, ‘welfare’ is a broad term and only a fraction of welfare benefits spending is on unemployment benefits.

The largest amount paid out in welfare benefits is for pensions and the Office for National Statistics’ last available figures show that £108b of the £258b welfare spend in 2014/15 went on pensions.

In fact, total pension spending has increased by 25% since the financial year 2010/11. This isn’t surprising as life expectancy has been steadily increasing, so state pensions are being claimed for longer. The remaining life expectancy for someone aged 65, in 2016, is 21 years for a man and 24 for a woman.

What that means is that the idea that people have ‘paid in what they get out’ is increasingly untrue. Some of those claiming pensions will have contributed comparatively little to their state pensions, whereas actuarial calculations on future pension need carried out when older pensioners were working would have been predicated on them dying within a few years of retirement. The fact that we are all living longer means that the proportion spent on pensions is likely to continue to rise just at the point when the working age population which funds the spending is in decline.

WHERE THE MONEY GOES: CARE AND DISABILITY

£29 b is spent on personal social services. About £41 b goes on benefits for people who are ill or disabled, while £10 b goes on elderly care payments. Disabled people are more likely to live in deprived areas and work in routine occupations. In the 2011 Census, 18% of people (10 million) reported some form of disability.

As for elderly care, there were 9.2 million people aged 65+ in 2011, making up 16% of our population. The care home population has actually stabilised over the last decade at around 300,000 people, but there has been an increase of 600,000 people (likely family members) providing unpaid care between 2001 and 2011. In total, 5.8 million (10%) provided unpaid care in England and Wales in 2011, and the majority were of working age.

W HERE THE MONEY GOES: POVERTY AND THE UNEMPLOYED

£44 b goes on family benefits, income support and tax credits. This includes benefits such as child benefit and support for people on low income. Around £3.5 b goes to the unemployed.

There were around 3 million people in in-work poverty in 2013. This meant their household income (adjusted for household size and composition) was below the poverty threshold and were in employment themselves. The 10% of households with the lowest disposable income spent an average of £196 a week in 2013. Of this, half (£98) was spent on food and non-alcoholic drinks, transport, housing (including net rent), and household fuel and power.

As for out of work people claiming Jobseeker’s Allowance and Universal Credit, there were 760,200 people claiming these benefits in January 2016. This number has decreased by 11.2% compared with a year earlier

WHAT ABOUT FRAUD?

The notion, often pushed by the tabloids, is that there is a massive amount of benefit fraud. A poll carried out by the TUC in 2012 revealed that British people believed that 27% of benefits were claimed fraudulently.

To describe that as a ‘wild overstatement’ does not do how wrong it is justice. It seems to be one of those figures arrived at on the basis that ‘everybody knows’, rather than being remotely founded in reality.

The actual level of all fraud in the UK’s welfare benefits system was 0.8% in 2014/15.

While that is the amount of detected fraud, to suggest that it is completely out of line with actuality is to ignore the fact that the UK government employs 12 times as many benefits fraud investigators than it has tax fraud investigators.

The UK loses six times more through tax evasion and aggressive tax avoidance than the total value of fraudulent welfare benefit claims. Moreover, the UK fails to collect £34b in tax each year. And that is providing you accept the UK government’s figures, which are disputed by some economists as a wild underestimate.

While benefits fraud is an issue, there is an argument that the amount of time spent on it and the amount of publicity it receives is out of all proportion to the actual value of the fraud involved.

University of Warwick political scientist Adam Taylor said: “

This isn’t to say that benefit fraud is OK or that HMRC isn’t doing anything about tax evasion. But it is wrong that the government feels it can openly threaten the poor while merely cajoling the rich. And it is sad that the tax-burdened middle class reserve their outrage for the single mother working in the cafe while lionising the rich, famous and powerful who are getting away with it, tax free.”

WHO PAYS?

Successive governments have been aware of the crisis facing benefit payments for over two decades and yet none of them has sought to do anything more than fiddle at the margins and target the most vulnerable and weakest members of society: the Cameron Government spent an enormous amount of political capital to no good end making an economically pointless adjustment to housing benefit with the hated bedroom tax. The projected savings from that policy were tiny.

In addition, the amount of direct tax paid by the working population is contracting along with the numbers of those in work and the changing profile of work economic activity.

In the past, when the welfare model was fixed, there was generally one full time bread winner per working class family in a job which lasted an entire working life. Stable incomes represented a stable and predictable tax yield. However, the change from a high labour manufacturing economy to a service-based one with lower labour requirements, altered the whole dynamic of working class life. Multiple part time jobs may reduce the number on the unemployed role, but lower income jobs pay less into the UK’s tax base.

So, the question that all governments face is how to provide people with the welfare benefits they need without upsetting voters who have to pay for them.

NO EASY ANSWER

The issue is particularly acute due to David Cameron’s 2015 promise not to raise National Insurance, Income Tax, or VAT. Where else, the question might fairly be asked, would the money come from? Especially as there is a guaranteed 2.5% increase per annum in the state pension.

Oh – and older voters and pensioners vote in far higher numbers than the young. On the basis that turkeys seldom vote for Christmas, you can guess why politicians are wary of doing anything to affect that demographic.

One thing is certain, fiddling at the margins is not enough. But whether politicians have the will to make the sort of changes needed to the UK’s tax and welfare system, is one of those questions to which there is no glib answer.

Which do you prefer, after all, higher taxes or cuts targeted at those least able to defend themselves?

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Mark Drakeford says: ‘Thank you Wales for going red’

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LABOUR is staying in power in Wales after matching its best-ever Senedd election result. It won exactly half of the 60 seats in the Welsh Parliament with all results now declared

Labour has 30 seats, with the Conservatives on 16, Plaid Cymru on 13 and the Liberal Democrats one.
Mark Drakeford thanked Wales for “going red” and has vowed to be “radical” and “ambitious” in government, as Labour looks to solidify its leadership in Wales.

Labour’s Vaughan Gething, health minister in the Welsh government, told the media that the party didn’t “have to look at a formal coalition” because they had done so well.

“We do, however, have to talk to other groups within the Senedd,” he said.

Mr Gething said Labour had a “strong mandate to govern” with 30 of the Senedd’s 60 seats.

The Wales Green Party failed to win a seat in the Senedd elections but they say they recorded their highest-ever result in Wales. Leader Anthony Slaughter said the “results demonstrate the appetite for change” across Wales.

A very happy Mark Drakeford on Saturday, May 8 (Photo Welsh Labour/Twitter)

Amelia Womack, deputy leader of the Green Party, said: “We seem to be getting votes from all of the parties and support on that regional list as people increase their knowledge of the voting system.”

Adam Price, who held Carmarthen East and Dinefwr with a reduced majority, said he would not stand down as Plaid Cymru leader.

Despite no gains, Mr Price said the party had increased its share of the vote and its stance on independence had been a “net positive”.

“I’m not walking away from anything, because this is the moment when Wales needs leadership,” he said.

“This is a historic challenge, because of the way that the politics is moving in this island, but it’s also a historic opportunity for us.

On the campaign trail, Plaid leader Adam Price (Pic Plaid Cymru)

“We can move our nation forward and I’m looking forward to playing my part, it’s not something that anyone can do on their own.

“I have a role to play, we all have a role to play and that’s what’s exciting about politics at the moment. Wales is on the move Wales is on the march. I’m going to be part of that.”

Later, on social media, Adam Price said: ” I extend my congratulations to Mark Drakeford on securing a mandate to lead the next government. Although disappointed not to be returning more Members to the Senedd, I am proud that we ran a positive campaign based on a transformational programme.

“Our Senedd group will bring renewed energy and fresh ideas and I look forward to working with all my colleagues as we continue to build the case for independence. We will be a constructive but forensic opposition as we enter a crucial period of pandemic recovery.

“However, the sixth Senedd will be poorer without one of Wales’s most remarkable politicians. No one has given more to the party or to her community than Leanne Wood – an inspiring role model for so many.

“Leanne’s commitment to the Rhondda is unparalleled and I know she will continue to make an important contribution to the future of our nation and the pursuit of social justice which always has and always will drive her politics.

“Westminster’s attack on devolution is only just beginning and Wales needs a plan – that plan must focus on taking our own future into our own hands so we can build a nation that is fair and free.

TORYS CLAIM BEST RESULT EVER

The Welsh Conservatives say that they have secured the party’s best ever result in a Senedd election, winning 16 seats in the Welsh Parliament.

In a statement to the press the party said: “Today’s final election results have seen the Welsh Conservatives secure two regional list seats in both South Wales Central and South Wales East.

“Welsh Conservatives polled 289,802 votes (share up 5.0) across 40 constituencies – 26.1% of the vote – winning eight seats including gains in both the Vale of Clwyd and Brecon and Radnorshire.

“On the five regional lists, Welsh Conservatives secured 278,560 votes (share up 6.3), winning eight seats. The result will see the Senedd return its first ever female from a BAME background, with Welsh Conservatives’ Natasha Asghar making history with election in South Wales East.

Welsh Conservative Senedd leader, Andrew RT Davies with Joel Williams on election day (Pic RT Davies/Twitter)

Commenting, Welsh Conservative Senedd leader, Andrew RT Davies said: “Firstly, I’d like to say a huge thank you to our outstanding set of Welsh Conservative candidates, activists and staff who’ve worked incredibly hard throughout this campaign and secured the party’s best ever Senedd result.

“The team has gone above and beyond and deserve great credit for the positive campaign we’ve run right across Wales, and I am thrilled to see Natasha Asghar make history in South Wales East by becoming the first female from a BAME background to be elected to the Senedd.

Newly elected Conservative member of Senedd, Sam Kurtz, talking to BBC reporter Aled Scourfield (Pic J Coles/Herald)

“As a party we are also delighted to have secured constituency seats in the Vale of Clwyd and Brecon and Radnorshire, and increased seats on the regional lists, resulting in our highest ever representation in the Senedd with 16 members.

“It’s been an unconventional campaign and it’s clear incumbency and continuity has played a significant part. To that end, I would like to offer my sincere congratulations to Mark Drakeford and Welsh Labour on a successful campaign.

“The election has been fought in good spirit by political parties in Wales and I would like to pay a final word of thanks to the many officials across the country who’ve allowed this election to take place in a safe and effective manner.”

IMPACT OF PANDEMIC

Ian Price, director of CBI Wales, congratulated Labour. He said: “This is a critical time for the Welsh economy and the new parliament must have a laser-like focus on rebuilding from the devastating impact of the pandemic,” he said.
“That means all parties pulling together and working with business to protect jobs, rebuild livelihoods and create a fair and sustainable recovery that addresses the longstanding structural challenges our economy faces.”

Royal Town Planning Institute, largest professional body for town planners in the UK and Europe, commented on the election result saying: “The Welsh Labour Manifesto meets many of the issues raised by the RTPI, including tackling climate action, investing in public transport and active travel, and the delivery of quality affordable homes, including a focus on strengthening Welsh language communities.

“The manifesto commits to strengthening the autonomy and effectiveness of local government to make them more successful in delivering services. We have highlighted the need to invest in planning services to enable the delivery of Welsh Labour’s priorities.”

LABOUR “RESILIENT”

Speaking to the BBC, political commentator Prof Roger Awan-Scully said: “I think it’s been an astonishingly resilient performance by the Welsh Labour Party, amidst disasters for Labour elsewhere in the UK.

“The Conservatives are also performing strongly, but not quite bringing it home in terms of the number of constituency victories that they might have expected.

“For Plaid Cymru I think this has to be said to be a deeply disappointing election.”

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Conservatives hold on to Carmarthen West and South Pembrokeshire seat

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THE CONSERVATIVES have held on to their Carmarthen West and South Pembrokeshire seat despite Labour closing the gap.

Sam Kurtz will take over the seat from the outgoing Angela Burns who held a majority of 3,400 at the last election.

This time, the gap was just 936 to Labour’s Hassan Riaz who picked up 10,304 votes.

Plaid Cymru’s Cefin Campbell picked up 6,615 votes.

The turnout in Carmarthen West and South Pembrokeshire was slightly up to 52.12% from 51.2% in 2016.

However, with a larger electorate thanks to votes for 16/17-year-olds, the number of votes cast went up by almost 3,000.

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Polling station changes in Pembrokeshire

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POLLING STATIONS in Pembrokeshire are open today (May 6) but a small number may have changed from the last time you voted.

In Neyland, the polling station will be at the new Community Hub building on John Street.

St Katherine’s Church Hall will be the new host for the station in Milford Haven, having previously been held at the Murray Suite in the town hall.

A polling station will be placed at the leisure centre in Haverfordwest while one at Trecwn has been moved to the Gate, Scleddau.

Voters in the county will be electing for the Preseli Pembrokeshire and the Carmarthen West and South Pembrokeshire constituencies.

People will also be able to select five MSs to represent the Mid and West Wales Region.

The candidate with the most votes will win the constituency but the ballot for the region will be decided by a different process.

People will be elected according to their share of the vote, using a mathematical process, and gives parties who may have won fewer or no constituencies a better chance of winning regional ones.

It will also be a big day for 16 and 17 year olds as they will be able to vote in Welsh elections for the first time.

The ballots will be counted on Friday (May 7) with results expected to come in from the afternoon.

Polling stations opened at 7am and will close at 10pm.

All those who vote will be required to stick to Covid-19 safety measures including wearing a mask and maintaining social distancing.

Clean pencils will be available but voters can bring their own pen or pencil.

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