The Daily Telegraph - Saturday
Conservatives must retain their ‘true blue’ ideals
British workers will today receive a welcome tax reprieve as the 2p cut to National Insurance Contributions (NIC) announced in the March Budget comes into effect.
Combined with the 2p reduction introduced in January this year, Jeremy Hunt has delivered a tax cut worth more than £900 to the average employee in the space of just a few months. Direct taxes on the average earner in this country are now at their lowest level for more than half a century.
As the overall tax burden approaches a 70-year high, the question remains: who is paying for this largesse? The Tories may have taken Britain a step further along the road to abolishing NICs, yet a phenomenon known as “fiscal drag” means more people – 3.3 million workers from this tax year until 2027-28, according to the OBR – are required to pay higher rates of tax than they did previously. The better-off are being hit harder than ever in order to prop up public services in our low-growth economy. In 2000, the top 1 per cent paid just over a fifth of all income tax; now it is just under a third.
As a consequence, the Tories face the quandary that tax reductions worth £10billion have failed to shift the polls. The problem may lie less with the policy – Mr Hunt is right that the “unfairness” of this “double taxation” must be put to an end – than its delivery, which has been lacklustre. Now is not the time for the Tories to be coy, especially when Labour remains decidedly quiet on its own long-term plans for national insurance. Moreover, it is not hard to picture a world where the spending plans of Labour, once in office and despite their promises, result in further tax rises, marking a clear dividing line between the two main parties.
A deeper concern may now be that the appetite for bolder economic policies will soon narrow within the Conservative Party. The Telegraph today reports on accusations that No 10 is blocking “true blue” candidates from standing in the next general election, instead favouring applicants who believe in consistently high taxation in order to support a larger state.
Yet this would be difficult to reconcile with the Prime Minister’s insistence that he wants to “control” public spending, or the Chancellor’s well-articulated warning this time last month that, in a free society “the money you earn doesn’t belong to the Government”. If a battle for the future of the party is under way, it must be hoped that those who understand the relationship between low taxes, a small state and economic growth, emerge triumphant.
The Conservatives will struggle to regain the trust of wary voters until they can prove they are on the side of aspiration and personal responsibility. This will be much harder if the next cohort of Tory MPs do not subscribe to these principles.
The duty of public services
When the Government sold off its last remaining stake in Royal Mail in 2015, George Osborne, who was then chancellor, hailed a “milestone moment” that marked a
“win all round”. Less than a decade later, with its future in doubt, the Postal Service is proposing to deliver secondclass letters just three times a week. Many have greeted the news with dismay. Allowing Royal Mail to drop its basic commitments has implications beyond the justifiable frustrations of habitual letter-writers.
Four health bodies have told The Telegraph that millions of people missed medical appointments in 2022-23 owing to late delivery of letters, and warn that this will only deteriorate further under Royal Mail’s proposed new plans. While NHS managers have stressed the importance of digital technology in improving services, a huge number of letters are sent each day and they will remain a necessity for those without internet access or computer literacy.
Non-attendance cost the NHS over £1 billion every year but it is the effect on health outcomes which is of graver concern. Patients have long suspected that their welfare is a second order issue, and may not be assuaged by the news that consultants have agreed a pay deal worth up to £20,000 after nearly a year of walkouts. Without productivity gains, will their substantial wage increase mean cuts elsewhere, and how might this compromise patient safety? With an ONS survey this week indicating the NHS waiting list could be much longer than previously thought, it can ill afford more missed appointments. Both the NHS and Royal Mail must uphold their obligations.
Kitchen sink drama
Every so often something happens that feeds the suspicion that American celebrities are funny people. The latest is the outbreak of taps appearing in their celebrity kitchens, fixed above their celebrity stoves. The idea is to fill saucepans without lugging them all the way from the sink to the stove. Two minutes’ thought exposes the drawbacks. The tap swings on an arm across the stove to reach all burners. So it may get hot and will get greasy. Who is to clean it? If it starts dripping (as it will), owners will have to put a big pan under the armature to catch the water, then lug that to the sink to empty it. Message to America: if it ain’t broke don’t faucet.