Lords Tax Credit Vote; Osborne’s Poll Tax moment?

The following was written by Frederick Antonio Gallucci | @gibblegbble

  
It is odd that I find myself cheering on the House of Lords, Britain’s unelected second chamber is a strange anachronism, a quasi-medieval second chamber, stocked full of Lords, Barons & Viscounts with quite a few vicars/priests thrown in (“church & state”) This weirdly makes the UK, aside from Iran, one of the few countries with religious leaders engaged in the scrutiny of the actions of the legislative & executive branches. Britain truly is an odd democracy. During the general election in May 2015 David Cameron (I’m sure you have seen the clip) when asked on Question Time if the Conservatives were secretly planning to cut tax credits by a concerned looking member of audience stated explicitly:

“…no I don’t want to do that. This report that was out today is something I rejected at the time as Prime-Minister, and I reject it again today.”

However in George Osborne’s “emergency budget”, following the very surprising Conservative victory, the policy to introduce cuts of £4.4 billion in tax credits (something not mentioned in the Conservative 2015 election manifesto). The Conservatives had stated they had “signalled” (as Michael Gove put it), there would be cuts to welfare spending, prior to the election. The Torys did talk about £12 billion of welfare cuts but steadfastly refused to explain what those cuts would involve. Yet, many “working class” Conservative voters now feel duped, having assumed either naively or genuinely, the Conservatives would best protect their interests. As the visibly angry/shaken mother & small business owner, Michelle Dorrell, pointed out on Question Time:

“I voted Conservatives originally, because I thought you were going to be the better chance for me and my children. Your about to cut tax credits, after you promised you wouldn’t.”

“…..And your going to take it away from me and them….”

Many such voters (justifiably) now feel used by the Conservative party and understandably angry. Many callous people of the left snidely have said, 

“What did you expect, they are Tory’s. It’s your own fault, you are getting what you deserve’’.

But this sort of reaction is not helpful, ordinary working people with families, bills to pay, working very hard to put food on the table, voted for security which they saw the Conservatives offering. Such people chose to put their faith & trust in the Conservatives. George Osborne’s plans have broken this trust, and left many people rightly dismayed, worried and importantly feeling betrayed.

Former Labour MP Lord Dale Campbell-Savours accused the Prime Minister of lying. In a scathing speech during the Lord vote he stated:

“The British public would regard what he said now as a lie, a lie to win a General Election. The British public are fed up with politicians who tell lies on that scale. It exceeded the misleading of the public in the case of the Liberal Democrats over tuition fees. At least they didn’t know what was going to happen after the election. In this particular case Mr Cameron did know. The public cannot take this scale of lying.”

Public pressure has mounted. Civic society organisations, trade unions & charities all have pointed to working families being worse off by virtue of the Chancellors cuts. A report on the tax credit changes showed that such cuts would leave workers in financial difficulty and around 3.2 million families would lose on average £1,300. The Labour party under the leadership of Jeremy Corbyn detailed its opposition to the proposed cuts to tax credits.

Osborne (being the shrewd political operator that he is) attempted to push his “reforms” to social security & tax credits through the House of Lords as a “statutory instrument”. Essentially Osborne was trying to ‘quickly get a change to the law through parliament without the usual standards of debate and scrutiny’. Yet this attempt to subvert democracy by the Conservative chancellor also proved to be his undoing; statutory instruments are able to be reviewed by the House of Lords & voted against.

 

Four motions were tabled to be voted on by the Lords:

1) The fatal motion: Tabled by Liberal Democrat peer Zahida Manzoor, would sound the death knell for Osborne’s tax credit plans.

2) Molly Meacher’s motion: Motion would delay the cuts until the government spells out how it will help low-paid workers. Meacher, the crossbench peer behind the motion, is not expected to force a vote if the government says it will produce a report highlighting the effect of the tax credit changes on different income groups.

3) A motion tabled by Patricia Hollis, the former Labour minister: The most dangerous motion for Downing Street forcing the chancellor to go back to the drawing board. It would halt the cuts until the government produces a scheme to compensate low-paid workers for three years.

4) The motion of regret: Voting for this motion, to be tabled by the bishop of Portsmouth, Christopher Foster, would allow peers to register their opposition without disrupting the government’s plans. Unsurprisingly, the government is hoping that crossbench peers will support this motion.

On the face of it the “fatal motion” put forward by the Liberal-Democrat peer appears the preferable option to stop the government in this instance. However, opponents of the Osbornes measures on tax credits (i.e. Labour) have dealt with Osborne in a more nuanced manner. Were it to be full rejected outright, it was highly likely Osborne would simply put it to the Lords again immediately, rushing it through. Further the second & third motions tabled held greater cross-bench support, hence likely to be passed.
Meacher’s motion and motion tabled by Patricia Hollis, essentially placed Osborne’s plans into limbo. Nicola Sturgeon tweeted:

“I’m no fan of the House of Lords but, if you are a Labour peer, why would you abstain in a vote to stop tax credit cuts?”

This ignores the fact that these 2nd & 3rd motions put forward by Meacher & Hollis in essence prevent Osborne getting his way.

As stated by Lady Hollis:

“…it delays this SI to ask the Government to provide transitional protection for existing families who are doing everything that we asked of them, who trusted the Prime Minister’s word that tax credits would not be cut and who trusted Parliament…”

After strong criticisms of tax credit cuts from all sides of the house, the Lords voted for a delay of 3 years, demanding that George Osborne fully reveal the impact of the cuts (until the government responds to the Institute For Fiscal Studies’ assessment). Peers backed the motion by Baroness Meacher, by 307 votes to 277. The motion of Labour peer Hollis was also passed outlining a Labour plan to provide transitional financial support for at least three years for those likely to be affected (289 to 272). Though these motions did not reject the proposals, but “delay” cuts, this position is arguably more damaging for Osborne & the Conservatives. Baroness Meacher told Sky News that the government was “pulling the rug” from under the feet of working people, saying the outcome sent a “powerful message” to MPs to think again. It is a “very bad result” for the government.

  
The cuts George Osborne intends to implement are now very much under the microscope of public scrutiny & discourse. Labour Shadow Chancellor John McDonnell wrote to Osborne prior to the Lords vote asking him to “fully u-turn” on his position with regards to tax credits. Even the Conservative supporting Murdoch “news-paper” The Sun came out against the Chancellor, referring to his plans as “bonkers”. Public pressure & immense media attention on tax credits have put George Osborne in a very difficult position. He has been hoisted by his own petard. For Osborne to carry on with his cuts to tax credits would be electoral suicide, both for his prospects as a future party leader & the Conservatives more broadly. It faces the public backlash as regards Cameron’s lie. Many Conservative MPs in marginal seats have, in recent weeks, faced the wrath of their constituents and are nervous. Conservative MP Heidi Allen summed up this position in her maiden speech stating:

“….her party must not treat it as “a spreadsheet exercise” since many of those affected would not be able to cope and faced a stark choice between heating their homes and putting food on their tables”.

If Osborne’s “reforms” were to become law, the £4.4 billion in cuts implemented, more 70 of Conservative MPs would be vulnerable to losing their seats in parliament to a public backlash against cuts to tax credits. The stakes for the Conservatives are too high. This could be a “poll tax moment”. It is an issue “slowly but surely developing into the biggest domestic political problem for the government…”. PMQs on the 28th has shown the pressure and criticism Cameron et al are facing. Jeremy Corbyn held Cameron’s feet to the fire, asking him six times for a guarantee families on tax credits won’t be made ‘worse off’. Cameron did not provide any answers, only empty rhetoric. His silence speaks volumes.

The Conservatives have lied, Cameron has lied, and the public are angry.

Three years is a very long time in politics. I think Osborne’s cuts to tax credits will die on the branch.

By Frederick Antonio Gallucci | International Law LLM | @gibblegbble

 

(Source – http://touchstoneblog.org.uk/2015/10/todays-tax-credit-debate-what-is-the-independent-assessment-going-to-reveal/)

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