Labour's Spending Plans - Fully Costed

[Sidney1st]

If you haven't got one Sid get a family n friends rail card. You get I think 25% off all train fares and the kids travel for next to nothing. 1 card allows up to 4 kids on the same journey, it is about £30 for a year. Have a go online pricing the journey from yours to Burnley then do same clicking railcard option, you will get your £30 back on the first trip.

I did have a look at that, the overall costs are reasonable, and I am going to get one, how bad the trains are will determine whether or not I switch to a car instead.

[South West Claret.]

Fatboy has just touched on the privatisation of BR, I went to a talk by Lord Faulkner a few days ago and he was most revealing about what went on around the Beeching years.

Among others things I didn't know about was the conduct of a certain Mr Marples the Transport Minister around that time:

Alfred Ernest Marples, Baron Marples, PC (9 December 1907 – 6 July 1978) was a British Conservative politician who served as Postmaster General and Minister of Transport

His period as Minister of Transport was controversial. He both oversaw significant construction (he opened the first section of the M1 motorway) and the closure of a considerable portion of the national railway network with the Beeching cuts. His involvement in the road construction business Marples Ridgway, of which he had been managing director, was one of repeated concern regarding possible conflict of interest. It was Marples who appointed Richard Beeching to head British Railways. Beeching went on to publish a report which closed more than 4,000 miles of railway lines in the UK with a resulting rise in the amount of road traffic.

In later life he was elevated to the peerage before fleeing to Monaco at very short notice to avoid prosecution for tax fraud.

[RingoMcCartney]

we have hit peak ringo.

On the very same day that employment levels hit a 43 year peak!! Weyhey!

Reasons to be cheerful!!

Anyway I'll let you lads get back to the communal doom n gloom festival!

Have a great afternoon gents.

[dsr]

Beeching's report was published in early 1965, after the Conservatives had been voted out of office. The minister who implemented the Beeching report was Barbara Castle, in Harold Wilson's government.

Marples appointed Beeching, but can only bear a small part of the blame.

[South West Claret.]

"Marples appointed Beeching, but can only bear a small part of the blame."

Nonsense and you know it.

[Spijed]

On the very same day that employment levels hit a 43 year peak!! Weyhey!

Reasons to be cheerful!!

Anyway I'll let you lads get back to the communal doom n gloom festival!

Have a great afternoon gents.

At the same time people are barely earning enough to live on.

[Paul Waine]

I agree, that's why I'm confused as to why you were only putting across the view that tax increases would result in less tax being collected when talking about the theory. You'd possibly assumed that we were past the optimal rate but without making that clear you were misrepresenting it to prove your point.

IFS say the predicted tax revenue is a little optimistic but entirely possible (and then caveat with it may earn nothing which seems excessive) which seems fair. The point isn't really whether the take will be linear, it's that there is a good chance that tax revenues will still increase overall and we're moving towards the optimal tax rate.

Obviously there's a better chance that this will work if it is done in line with anti-avoidance measures (such as the recentish cap on tax-free pension contributions, crack-down on IR35, etc).

Hi aggi, I was only copy/pasting from the IFS on the first post you responded to, all their words, not mine.

My second post today was responding to you and AJB.

Being allowed to save for your pension - and later pay tax when you draw that pension - is not tax avoidance. The government wants/needs us to save for our pensions. There is no suggestion that the little bit of state pension that we get when we reach the appropriate age is anything more than a contribution to our pension requirements. I guess you've noticed that the state pension pays a lot less than the living wage.

[AndrewJB]

Thanks aggi and AJB for your replies.

A couple of points: economics is not a precise science (I'm sure all economists still agree on that). Laffer's theory to explain observable behaviour is a macro economist's attempt to produce a model. There can be many views on the optimal rate. I'd suggest that there is no fixed universal rate, it is more reasonable to consider that it will vary from time to time, for example, if a country is in an existential war the rate will be much higher than if there is no such war. It may be that the rate will also vary depending on the motivation of the politicians, JC's attack on the "top 5%" would more likely reduce the rate than, as suggested, a call to "shared responsibility." I'm sure the rate also varies from country to country.

As for decisions to move to another country, we need to remember that a lot of the wealth held and a lot of the income earned is in other countries and a lot of the assets owned in the UK are owned by non-UK citizens. The UK works hard to attract investments from overseas, this is important to our economic growth.

AJB, are you proposing that the UK takes away the Japanese passports of the owners of Nissan, or the Indian passports of the owners of Jaguar Land Rover, or the US passports of the owners of many of the major banks in London? That's not going to keep any of these jobs in the UK.

Aggi, you state that JC's manifesto assumes only "65% of possible total revenue" - I think this is their recognition of (what some know as) the Laffer curve. IFS acknowledges their lower estimate - but still says it is too high.

Not all foreign investment is good. There is a lot of foreign money in the London property market, for instance - and this is having a net negative impact for the majority of people. Would you agree that it's ironic that the same people who want to restrict immigration into Britain seem perfectly happy allowing foreign money to buy whatever it likes? As for positive foreign investment, I think the best way to attract it is by having a healthy prosperous and well educated set of consumers for their products (and workforce for their company), a modern infrastructure, and rule of law. This will attract positive foreign investment on a greater scale than just low taxes (which, if it were so important, they could get in Somalia). And the cost to foreign investors for this great investment climate is that they pay in their fair share.

And no, I wasn't suggesting that we take away the Japanese passports of Nissan's owners (to use your example). What I was trying to illustrate is that we must not fall prey to the politics of appeasement. The rich should not have the power to damage Britain's economy in response to a tax rise (which isn't going to impoverish them, leave them hungry or on the street, or any of the other things they seem to be happy to do to disabled people). And if they do have that power, then they are too powerful.

[claretdom]

At the same time people are barely earning enough to live on.

Ah but wait while Corbyn gets in and the minimum wage is £10 per hour, tuition is free, tax is lowered of lower end earners, more new houses which are cheaper to buy, more time off work with pay, all energy bills lowered and many other bonuses. Everyone in the world will want to move here and we will be the envy of the world.

[UpTheBeehole]

Ah but wait while Corbyn gets in and the minimum wage is £10 per hour, tuition is free, tax is lowered of lower end earners, more new houses which are cheaper to buy, more time off work with pay, all energy bills lowered and many other bonuses. Everyone in the world will want to move here and we will be the envy of the world.

Just to confirm, all the above is fully costed within Labour's manifesto.

[Paul Waine]

Fair point about the tickets.

As for seating, is the issue an increase in rail users or not enough trains, or just more trains needed at peak times?
If more trains are going to be put on, then staffing will need to be increased or made more efficient, but efficency measures are usually disputed by the Unions.

I'll have a look round online during my lunch break, but it could be simply be down to demand more than anything else and there's only so much room on the railway lines, at a guess there probably needs to be x amount of time between trains for safety reasons.

I'm not ruling out nationalizing the railway network, but will it really be any better was my query?

Hope you've had a good lunch, Sid.

There are more passengers using the rail to commute into London. I guess some stats might be available on TfL website.

The line I've used for nearly 30 years (I think that was pre-privatisation) has expanded service at "peak hours" from 4 trains per hour to 6. The extra trains were added after privatisation. This summer they will expand again to 12 car trains from the existing 8. If you need to get into London before 9 a.m. on many of the trains (30 mins journey, 9 or 10 stops) you will be standing all the way.

I understand some of the other lines/London stations are much worse.

[claretdom]

Just to confirm, all the above is fully costed within Labour's manifesto.

He will walk the election is he has fully costed everything and he can promise to be able to afford his pledges won't he ? Everyone is going to be better off and happier and only 5% are going to have to fund the difference for everyone else ?

Not often in life you get a 14/1 certainty but maybe this is the one.


Or is the truth, he knows he can't win, he knows he won't win so can put what ever empty promises he wants the party to peddle. Then for the next 4 years we get a labour party member on Question Time claiming "we would have done this or done that" and could have ended all problems in the country.

[UpTheBeehole]

People do get elected on empty promises.

Cameron served two terms with a promise to get the deficit down. It's gone up.
Cameron made an empty promise to appease some backbenchers and 'swivel eyed loons', and here we are about to leave the EU.

I have literally no idea what Theresa May is promising this election. I've only heard the same three words parroted out by her.

[Sidney1st]

Hope you've had a good lunch, Sid.

There are more passengers using the rail to commute into London. I guess some stats might be available on TfL website.

The line I've used for nearly 30 years (I think that was pre-privatisation) has expanded service at "peak hours" from 4 trains per hour to 6. The extra trains were added after privatisation. This summer they will expand again to 12 car trains from the existing 8. If you need to get into London before 9 a.m. on many of the trains (30 mins journey, 9 or 10 stops) you will be standing all the way.

I understand some of the other lines/London stations are much worse.

I had to cut the lunch short, our systems have finally been repaired after being off line since yesterday morning.

So if they're increasing the number of trains in peak times and now they're going to extend the length of the train is it likely to reduce the number of people who stand up on the train to work?

People complain, but this is what happens when you make London the centre of the known working universe.
The HS2 railway isn't going to make it much better if someone can live up north and commute daily into London.

[Paul Waine]

Not all foreign investment is good. There is a lot of foreign money in the London property market, for instance - and this is having a net negative impact for the majority of people. Would you agree that it's ironic that the same people who want to restrict immigration into Britain seem perfectly happy allowing foreign money to buy whatever it likes? As for positive foreign investment, I think the best way to attract it is by having a healthy prosperous and well educated set of consumers for their products (and workforce for their company), a modern infrastructure, and rule of law. This will attract positive foreign investment on a greater scale than just low taxes (which, if it were so important, they could get in Somalia). And the cost to foreign investors for this great investment climate is that they pay in their fair share.

And no, I wasn't suggesting that we take away the Japanese passports of Nissan's owners (to use your example). What I was trying to illustrate is that we must not fall prey to the politics of appeasement. The rich should not have the power to damage Britain's economy in response to a tax rise (which isn't going to impoverish them, leave them hungry or on the street, or any of the other things they seem to be happy to do to disabled people). And if they do have that power, then they are too powerful.

Hi AJB, I agree with the foreign money "hiding" in the London property market. I know the estate agents welcome this money and the property developers. I wish the government had the courage to do something about it, whether it is Labour or Conservative.

I'm not sure who really wants to restrict immigration - other than the people who have experienced falls in wages as a result of the influx of cheaper labour. The big flood of immigration started under Labour gov't - and the EU regs have been a big restraint on getting to grip with the numbers. (I'm not anti-immigration).

I don't think any political party has every said they will aim to reduce the numbers of "wealthy" immigrants. And, although a number of expensive London properties are bought by foreigners I understand a lot of them leave these properties empty and continue to live elsewhere.

I agree totally with your statement a "healthy prosperous and well educated" - but not just consumers, also employees for their businesses. I agree also about the advantages we have in the UK with law and language and more.

I also agree fully with the responsibility of the citizens of our country - and that high earners should pay a larger share than the "not-high" earners.

[aggi]

Hi aggi, I was only copy/pasting from the IFS on the first post you responded to, all their words, not mine.

My second post today was responding to you and AJB.

Being allowed to save for your pension - and later pay tax when you draw that pension - is not tax avoidance. The government wants/needs us to save for our pensions. There is no suggestion that the little bit of state pension that we get when we reach the appropriate age is anything more than a contribution to our pension requirements. I guess you've noticed that the state pension pays a lot less than the living wage.

Well from the first post, I was mainly referring to The Institute for Fiscal Studies has issued a press release on the Labour manifesto proposed income tax changes. It will be useful reading for anyone who disputes that higher rates of taxation don't result in higher earners changing their behaviour - and so less tax being collected. Economist know this effect as the Laffer curve, after the economist who first wrote about the behaviour in economic circles. which I assume are your words as they're not in the edited quote marks.

I agree regarding pensions in general but there were loopholes that made pensions very tax efficient if you were very well off which have gradually been closed.

[Paul Waine]

I had to cut the lunch short, our systems have finally been repaired after being off line since yesterday morning.

So if they're increasing the number of trains in peak times and now they're going to extend the length of the train is it likely to reduce the number of people who stand up on the train to work?

People complain, but this is what happens when you make London the centre of the known working universe.
The HS2 railway isn't going to make it much better if someone can live up north and commute daily into London.

Extra carriages will ease it for a time, but there's also a lot of house/flats building going on. The new trains will be full again in a short time.

Did you see any of my posts about moving Parliament to Manchester/Northern Powerhouse after the 2022 general election? It will be good for all the MPs to see some of the rest of the country. It will also aid the growth of other global cities, which is what London has been for a number of years.

[Sidney1st]

Yeah, I agree with those moves, personally I think Birmingham area would be a better option, especially if Scotland breakaway.

[Damo]

How many of you remoaners are going to put your money where your mouth is and vote Lib Dem?

[dsr]

"Marples appointed Beeching, but can only bear a small part of the blame."

Nonsense and you know it.

It's not nonsense. Labour knew there was a rail cuts report coming and campaigned in the 1964 election that they wouldn't enforce the cuts. In 1965 the report arrived on their desk and they decided they would enforce it. Are you claiming that in 1965-69, when the cuts were being made, that Marples the former Transport Secretary was the man making the cuts and Castle the then current Secretary was unable to stop him?

Both parties wanted the cuts, but it was Labour who put them into practice.

[nil_desperandum]

How many of you remoaners are going to put your money where your mouth is and vote Lib Dem?

I think the vast majority of those who voted remain are intelligent enough to realise that this is a General Election, on which we SHOULD be voting on the issues that will determine what sort of society we live in for the next 5 years and beyond. (It's not the 2nd referendum that Mrs May has tried to turn it into)
Article 50 has been triggered and we're on our way to who knows where, but simply registering a "pro-EU protest" vote with the Lib Dems in seats that they cannot possibly win, and for policies that you generally don't agree with or are unclear about is not a sensible way of going about things.

[South West Claret.]

dsr when your in a hole it's well worth it to stop digging.. by the way what does dsr stand for?

[dsr]

dsr when your in a hole it's well worth it to stop digging.. by the way what does dsr stand for?

The Labour party chose to swing the Beeching axe. They may have been handed it by the Tories, but they had the choice whether to swing it; they chose wrong.

dsr stands for my initials.

[South West Claret.]

Fatboy has just touched on the privatisation of BR, I went to a talk by Lord Faulkner a few days ago and he was most revealing about what went on around the Beeching years.

Among others things I didn't know about was the conduct of a certain Mr Marples the Transport Minister around that time:

Alfred Ernest Marples, Baron Marples, PC (9 December 1907 – 6 July 1978) was a British Conservative politician who served as Postmaster General and Minister of Transport

His period as Minister of Transport was controversial. He both oversaw significant construction (he opened the first section of the M1 motorway) and the closure of a considerable portion of the national railway network with the Beeching cuts. His involvement in the road construction business Marples Ridgway, of which he had been managing director, was one of repeated concern regarding possible conflict of interest. It was Marples who appointed Richard Beeching to head British Railways. Beeching went on to publish a report which closed more than 4,000 miles of railway lines in the UK with a resulting rise in the amount of road traffic.

In later life he was elevated to the peerage before fleeing to Monaco at very short notice to avoid prosecution for tax fraud.

You can wriggle all you like dsr in an effort to blame anyone except some members of the "Con" Government at the time of Marples and Beeching.

[thatdberight]

Cameron served two terms with a promise to get the deficit down. It's gone up.

No it hasn't. Never mind. Try again.

[hampsteadclaret]

Let me assist the Beehole chap.

I think that he meant to write that..'the National Debt has gone up'..which it has. Tory Fail.

The annual budget deficits have been coming down, but at a slower rate than that serpent Osborne had promised..Tory Fail..[and of course the cuts in public spending that had to happen, allegedly, to get the deficits down, have done massive damage to key areas of the economy like the NHS, social services, education, housing, law and order]..some of these are now in a shocking state, and as the sticking plasters fall off, more and more people are realising it. Tory Fail.

TAXATION - it is helpful to make a general point as Labour's manifesto tax plans [correctly] come under scrutiny. For nine years of Mrs Thatcher's Prime Minister years, the top marginal rate of income tax remained at 60% in those years...the Labour Party need not take any lectures at all from the Tory Party or their media apologists, about appropriate rates of taxation.

[Paul Waine]

Let me assist the Beehole chap.

I think that he meant to write that..'the National Debt has gone up'..which it has. Tory Fail.

The annual budget deficits have been coming down, but at a slower rate than that serpent Osborne had promised..Tory Fail..[and of course the cuts in public spending that had to happen, allegedly, to get the deficits down, have done massive damage to key areas of the economy like the NHS, social services, education, housing, law and order]..some of these are now in a shocking state, and as the sticking plasters fall off, more and more people are realising it. Tory Fail.

TAXATION - it is helpful to make a general point as Labour's manifesto tax plans [correctly] come under scrutiny. For nine years of Mrs Thatcher's Prime Minister years, the top marginal rate of income tax remained at 60% in those years...the Labour Party need not take any lectures at all from the Tory Party or their media apologists, about appropriate rates of taxation.

Hi Hampstead, what was the position in May-2010 when Gordon Brown lost the general election? What was the national debt at that point? and, what was the annual deficit? Was that a Labour success, or a fail?

We then had 5 years of a coalition government, I'm sure our Lib-Dem colleagues wouldn't want David Cameron and George Osborne to carry all the "thanks" for what was achieved. What was the deficit at the end of the coalition government?

So, we can all do the maths: each year the deficit - even if it is smaller than the previous year - adds to the debt.

Did Cameron/Osborne fail because they didn't run a harder "austerity" programme?

Yes, agree that for the first 9 years of Thatcher as PM the top rate of tax was 60% - and before that under Labour the top rate was 83% plus 15% unearned income surcharge, making it 98%. We know that when Thatcher cut the top rate from 83%+15% to 60% that the government's tax revenues increased. And, we know that when, after 9 years, Thatcher and her Chancellor cut the rate again to 40% that tax revenues increased again.

And, then through the 13 years of Blair/Brown Labour government the top rate remained at 40% and was only hiked at the end of the Labour government.

The lecture is that tax plans are not found in Chairman Mao's Little Red Book - however frequently John McDonnell looks for inspiration there.

So, which is the better approach? It would make a great essay question for a group of 6th formers.

PS: I'm away in the morning for two weeks. We'll have to leave it here for the time being.

[taio]

Let me assist the Beehole chap.

I think that he meant to write that..'the National Debt has gone up'..which it has. Tory Fail.

The annual budget deficits have been coming down, but at a slower rate than that serpent Osborne had promised..Tory Fail..[and of course the cuts in public spending that had to happen, allegedly, to get the deficits down, have done massive damage to key areas of the economy like the NHS, social services, education, housing, law and order]..some of these are now in a shocking state, and as the sticking plasters fall off, more and more people are realising it. Tory Fail.

TAXATION - it is helpful to make a general point as Labour's manifesto tax plans [correctly] come under scrutiny. For nine years of Mrs Thatcher's Prime Minister years, the top marginal rate of income tax remained at 60% in those years...the Labour Party need not take any lectures at all from the Tory Party or their media apologists, about appropriate rates of taxation.

So what would you have preferred - more public spending cuts to reduce the deficit quicker, or more public spending with higher deficits and more debt?

[AndrewJB]

I think it's also good to remember that a fifty percent tax bracket only applies to income over a certain amount (in the last time it was income over £150K), so income earned by someone up to that amount is taxed at lower bands. Someone earning £200K under that regime only saw 50% tax on the last £50K of their income. This is not going to impoverish anyone, and I think it would be fair to say most people would be very happy to be paying the top rate of income tax (because it would mean you'd be earning more than £150K).

In my opinion when you get to stratospheric levels of income - in the millions - then 50% is too low.

[martin_p]

Presumably now that details of the Tory manifesto are emerging one of their supporters will be starting a thread telling us why raising money by picking the pockets of millions of pensioners is a better idea than taking a bit more tax off high earners.

[Steve-Harpers-perm]

Presumably now that details of the Tory manifesto are emerging one of their supporters will be starting a thread telling us why raising money by picking the pockets of millions of pensioners is a better idea than taking a bit more tax off high earners.

Will the Tories be bringing back the 'In it Together' slogan I wonder!

[Paul Waine]

Presumably now that details of the Tory manifesto are emerging one of their supporters will be starting a thread telling us why raising money by picking the pockets of millions of pensioners is a better idea than taking a bit more tax off high earners.

Not had time to see all that's in Theresa May's manifesto. I'm in my 60s, I'm pleased that winter fuel allowance will now be means tested. And, I'm pleased that there is something being done to sort out care costs. I'd always expected that I'd pay for any care needs before I passed on the balance of my estate (if any).

[HatfieldClaret]

Presumably now that details of the Tory manifesto are emerging one of their supporters will be starting a thread telling us why raising money by picking the pockets of millions of pensioners is a better idea than taking a bit more tax off high earners.

There are anomalies though. My mother lives in a care home but still gets winter fuel allowance. Why ?

UK pensioners living in Spain / Cyprus still getting winer fuel allowance to allow for those cold snaps ? Why

BTW, it is means tested so it's those who can afford it....(supposedly)

[hampsteadclaret]

178..
'what would you have preferred - more public spending cuts to reduce the deficit quicker, or more public spending with higher deficits and more debt'?

Well the first of those [spending cuts/austerity] did not work, that is why the deficits came down slowly and the National Debt always went up...stupid objectives by Osborne that he was never going to achieve.

Your second objective can work, IF YOU DO IT PROPERLY...it need not eventually always lead to 'higher deficits and more debt''?

For a Chancellor of the Exchequer, Gideon made many schoolboy errors. 'Austerity' was fatally flawed from the start.

I am getting trains to Burnley this morning, so this is briefly my take on it.


Osborne's brand of Austerity essentially relied on getting government spending and government borrowing down, year on year.

If you do this, other thing remaining equal then the economy will shrink, demand will fall and there will be less economic activity taking place.

In this shrunken economy the Government will collect less income tax, less VAT, less Corporation tax, less excise duty [plus others] so that their overall tax revenues will fall.

Meanwhile as Austerity squeezes the economy some elements of public expenditure will rise - in particular a wide variety of state benefits as people lose their jobs, have their hours cut, go part time and increasing numbers face zero hours contracts. Some state support will be provided. Government spending will rise in these circumstances despite attempts to cut it.

With tax receipts down, and government spending up, the annual deficit [and national debt] are both bound to increase...no surprises.

For Osborne to try Austerity not long after 2008/2009 and the two domestic recessions [double-dip] which followed, plus a banking crisis/credit crunch was just ludicrously flawed economic policy. It was never going to work [but it caused a lot of pain].

IF you can increase G [government spending] and reduce T[taxation] then demand will grow, as will the economy, and eventually spending on a wide variety of benefits and handouts will fall and your tax receipts will increase in a more buoyant economy, and your deficits can fall in that manner.

Some of this 'investing for the future' is in the Labour manifesto [housing for example] and is the reason why the New Statesman this week described this manifesto as 'more Keynesian than Marxist'..

http://www.newstatesman.com/politics/ju ... an-marxist" onclick="window.open(this.href);return false;

[martin_p]

BTW, it is means tested so it's those who can afford it....(supposedly)

So are tax rates (effectively). This will make significantly more people worse off than Labours tax plans though. Plus removal of the pension triple lock will impact every single pensioner, well off or not.

[nil_desperandum]

So what would you have preferred - more public spending cuts to reduce the deficit quicker, or more public spending with higher deficits and more debt?

It's not necessarily an either / or option though is it?

[aggi]

And where does the hundreds of billions come from to renationalise the mail, water and rail industries? Is paying shareholders off really capital expenditure?

I meant to reply to one of the comments on this but forgot.

Effectively this doesn't cost anything. You're buying an asset with cash (or it may be financed through gilt bonds or similar) but you're getting in return an asset, a company, at the same value so the net effect is zero.

[If it be your will]

.

[If it be your will]

.

[hampsteadclaret]

189... tax cuts for the wealthy were mentioned in this post ( not criticising the post) as potentially being desirable for economic growth.

I have never bought into this one very much.
Don't the wealthiest 5%, if you give them a tax cut, simply put most of it in the bank with the rest of their millions ££££££££..?
It won't do much good there!

If tax cuts are possible, give them to the poorest as they generally need them the most - they will also spend ALL of the tax break, increasing Demand and growing the economy.