Horse-trading in Halifax

25/03/2015, 09:55:41 PM

by Rob Marchant

Union money: “the cleanest in politics”, as some Labourites describe it, misty-eyed. To be fair, sometimes it is. There are decent unions who donate money because they actually want a Labour government. On the other hand, the cliché is that business donations always come with strings attached.

Let’s decide which of the two the following is.

Exhibit A: the Halifax selection, where Len McCluskey’s friend Karie Murphy was working hard, with the backing of the considerable weight of Britain’s largest union, to be its MP. The Sunday Times (£) wrote a couple of weeks ago that her place on the shortlist was being horse-traded for a previously-pledged donation of £1.5m to Labour’s election fund. Surely not?

After her failure to be shortlisted by the party’s Special Selections Panel, there were two possible outcomes: that Unite’s donation would then be delivered, and that it would not be delivered. Naturally, the outcome couldn’t possibly related to the Halifax selection. We’re talking about the cleanest money in politics, after all.

Oddly, the Telegraph reported last week that “a senior Unite figure said the union could withhold any further funding for final two months of the campaign and demand Miss Murphy is allowed to run for another seat this election.”

It is also important to note that Labour is perfectly entitled – and always has been – to select shortlists close to an election. The party has never pretended that this first stage is democratic – it can’t afford to be, when you only have weeks to establish a candidate and try to win – it is only afterwards that the local party gets to choose from the shortlisted candidates.

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David Cameron has made a massive mistake but Labour’s picked the wrong line of attack

24/03/2015, 08:50:59 AM

by Atul Hatwal

If the Conservatives win the next election, David Cameron has turned himself into a bystander in his next government.

By pre-announcing his resignation he’s dissolved his future authority with backbenchers, who will be more interested in winning the favour of the next leader, and shifted the media lens onto his potential successors. The question of when he will resign – because he surely won’t last a full term – will dog him each day and ultimately he will struggle for relevance. He’s condemned himself to a living political death.

In the wake of such an extraordinary unforced error, Labour’s chosen line of attack is that Cameron is taking the electorate for granted by assuming he will win the next election. It fits with Labour’s broader critique of him and in that sense is logical, but it’s also wrong.

Two of David Cameron’s greatest political assets are his double digit lead over Ed Miliband as the public’s preference for PM and the extent to which he personally outpolls his party.

David Cameron’s telegraphed resignation is the very antithesis of leadership; it’s the epitome of weakness and raises the likelihood that any one of a gaggle of unappealing Tories could be prime minister in the next Parliament. Suddenly, there might be some hope for Labour.

Instead of talking about arrogance, Labour should be recasting the leadership choice at this election as one between Ed Miliband and the dangerous unknown.

There are two aspects to this.

First, the message should be hammered home that David Cameron is about to quit on the British people in the next Parliament.

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Revealed: George Osborne’s secret £6.5bn tax raid on pensioners

20/03/2015, 11:17:26 AM

by Samuel Dale

Buried deep in this year’s dull Budget was a secret £6.5bn tax raid on pensioners and savers under the guise of radical reforms.

George Osborne’s most significant policy announcement was the proposal to allow pensioners already drawing an annuity to sell their policy in exchange for a lump sum.

It is the second stage in major pensions reform announced in last year’s Budget to allow all over-55s to access their pension pots.

The first stage of pension freedoms is relatively simple. The pension system saw savers build up a retirement pot of cash with generous tax relief on contributions. In exchange they had to buy a secure income or annuity (or face a punitive 55% tax if they withdrew their cash from the pension wrapper).

Annuities work as a reverse insurance product so you pay over a big chuck of cash to the insurer and in return they pay you money every month until you die. Insurers pool the risk so those who die earlier fund the payments for those who live longer than expected lives.

As people live longer insurers are paying a lower amount each month over a longer period, making pensioners buying them poorer. Successive Governments have taken steps to ease the requirement to buy an annuity by allowing wealthier investors to drawdown their own money.

But Osborne’s announcement last year, coming into force on 6 April, is the big bang. It means anyone can withdraw their pension pot at marginal income tax rates (although everyone receives an initial tax-free lump sum of 25%).

The Treasury estimates the behavioural changes will see individuals wanting the money today despite the tax penalties. It will lead to many savers paying income tax on withdrawals they have never paid before.

So how much does it cost?

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Budget 2015: The quiet moments matter

19/03/2015, 02:27:16 PM

by Jonathan Todd

Budgets are supposed to be big moments. The kind that determine general elections. But maybe they are decided by millions upon millions of quieter moments. When payslips are inspected, profits turned, and housing wealth accumulated.

In these quieter moments judgments are made on the economy’s performance. In turn, these bear upon general election votes. It is a eighteen months since Uncut spotted a gradual rise in the proportion of the electorate reporting the economy as doing well and a steady decline in Labour’s poll lead. We ran a regression to assess the relationship between these data series and postulated that the Tories would overtake Labour when a quarter of the electorate came to the view that the economy is doing well.

In May last year, when YouGov’s tracker on economic sentiment first started to bump up against a quarter of the electorate being of this belief, we noted that Tory poll leads had started to emerge. These leads were faltering and slow to confirm themselves. Like the upward trajectory in the proportion of the electorate positive about the economy.

24 per cent of the electorate thought the economy was doing well last May and Labour held an average of a 3 point poll lead, as the table below illustrates. Occasional Tory leads then existed but the average favoured Labour. The Tories weren’t consistently ahead but nor was economic sentiment resoundingly over a quarter. At 30 per cent, economic sentiment now comfortably clears the quarter threshold, and Labour’s poll lead is less impressive than last May.

If we simply compare the data in May 2014 and March 2015, they seem to confirm the original Uncut hypothesis: the more the economy improves, the narrower Labour’s lead. The pattern of these series between these two months, however, rewards inspection.

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The budget was Labour’s last chance. History is clear about what happens next

19/03/2015, 12:08:19 PM

by Atul Hatwal

Labour desperately needed George Osborne to produce another omnishambles budget. Something to reverse the ebbing tide of Labour’s poll lead.

It didn’t happen.

Osborne may have concocted an utterly ludicrous public spending profile for the next parliament – savage, penal cuts immediately followed by lavish expenditure, which led even the Office for Budget Responsibility to describe it as a “rollercoaster” – but he managed to kill Labour’s most potent attack line: that spending would be taken back to levels last seen in the 1930s.

Now, with under two months until the general election, history is very clear about what happens next.

Labour’s poll rating will almost certainly slide. Over the past fifty years of elections, Labour has lost an average of 4% in the last two months before an election.

Given an average poll rating in March (so far) of 33%, this would take Labour back to square one on May 7th with 29% of the vote, the same as 2010.

Poll rating1

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UKIP and the Greens are united by one thing: voodoo economics

17/03/2015, 09:55:30 AM

by Callum Anderson

Just a few weeks remain of the 2010-2015 UK Parliament. On Wednesday, the coalition government rolls its dice one last time, in an attempt to woo undecided voters.

Meanwhile last weekend, Ed Miliband unveiled Labour’s election pledge card at Birmingham’s ICC. The first two pledges – building a strong economic foundation and raising the higher living standards for working families – have sought to serve as indicators of Labour’s simultaneous commitments to fiscal prudence and growing the economy.

Indeed, it is the economy that will decide this election, with Mr Miliband’s Labour set to ask the electorate that famous question: “are you better off than you were five years ago?”

Whilst much of the scrutiny has rightly been reserved for the main three Westminster parties, it is the economic policies of the two most significant ‘insurgent’ parties – UKIP and the Green Party – that serve as the most unknown factor of the election.

So, where do UKIP and the Greens stand on economic policy?

Traditionally, UKIP has positioned itself as a libertarian party. However over the last year, in pursuit of widening its appeal, the party has drifted leftwards on economics, if not in social affairs. The UKIP of 2010 offering a flat income tax is a distant memory. But the result has been the same: economic illiteracy.

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Uncut review: Labour’s Spring rally was a tale of two Britains

16/03/2015, 10:42:33 AM

by Jonathan Todd

On Saturday, I met a friend for coffee and took my son swimming. Normal life, that simple, that complicated. Labour’s Spring Rally came in-between. This made the coffee and swim seem Damascus living: normal life accompanied by artillery’s distant thud.

There is not one nation but two Britain’s. The Britain of my coffee and swim. The Britain of the rally. Here the artillery is loud. War has been waged against the country by the government . “Britain can’t afford another five years of Tory government,” Shaun Dooley, the actor and one of Ed Miliband’s warm-up acts, implored.

“If we go on at this rate, the nation must be ruined,” Adam Smith was told by a student following a reversal for British troops in the American revolution. “There’s a great deal of ruin in a nation,” retorted Smith. It would take more than a prime minister as second rate as David Cameron to ruin us.

In rally Britain, however, all is at stake. We might be ruined. Or milk and honey might flow. A country where the next generation can do better than the last. Where the NHS has time to care. And working families have higher living standards.

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Nigel Farage has destroyed himself and Ukip. He might yet take the whole Eurosceptic movement down too

13/03/2015, 07:00:55 AM

by Atul Hatwal

When the history of Ukip is written, yesterday, Thursday 12th of March, will go down as the day the bubble burst.

It wasn’t just the banal manner in which Nigel Farage admitted he was a racist in his interview with Trevor Phillips.

To believe in discrimination based on someone’s background, to admit to wanting to scrap anti-discrimination laws and legalise racism, would have been damaging enough.

But it was his blustering, obfuscating and dishonest reaction that made matters so much worse. Claiming he was being “wilfully misrepresented,” when the original interview was widely available and the evidence so stark, was utterly incredible.

Five points are salient for the election campaign and beyond: the impact on Ukip’s brand, the opportunity for the Tories, the reaction of the journalists, the danger for Eurosceptics and the broader lessons for politicians talking about immigration.

First, Farage has injected arsenic into Ukip’s already toxified brand.

It’s hard to imagine who will be convinced to switch their votes to Ukip as a result of his latest intervention. Maybe some of the BNP’s dwindling support will be reassured that Farage is a true racist and peel off to join the purple army.

But many who might have considered Ukip will take fright.

According to a ComRes poll a few weeks ago, 44% already thought that the party was racist. As yesterday’s events percolate into the public consciousness, the number who think Ukip racist will rise to cross 50%.

A leader embodies their party and a vote for them says something about the elector. Not many would like that to be “I am a racist.”

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Six reasons why Labour should rule out an SNP deal

11/03/2015, 02:26:41 PM

by Rob Marchant

There is a rule in electoral pact-making, and pretty much any card game, which is fairly universal: don’t show your hand to the other players.

That is, don’t rule anything in and don’t rule it out. You have nothing to gain (you can fritter away your negotiation leverage when agreeing the pact) and everything to lose, in the event that you find yourself in a different situation from that expected and have to eat your words. Obvious, really. Wait until the moment comes and deal with things when you have all the information.

But it could also be argued that there one sensible exception to that rule: if the mere hint of a pact with another party could be damaging to yours even before the election. Especially when things are balanced on a knife-edge and almost anything could affect the result.

That has never really been the case with the Lib Dems: until 2010 they were a slightly dull, modestly successful and broadly respectable opposition party, whether we liked it or not. Now they are bloodied with the hard work of actual government and potentially facing a big hit at the polls, they are possibly less attractive partners. But neither are they toxic.

The same cannot necessarily be said for some other parties. Cameron would have to tread very carefully indeed in the unhappy event of ending in a coalition with UKIP, unlikely though that might seem – the toxicity of some of its members could sit ill with his (mostly) respectable party.

But worse still is the idea of a partnership between Labour and the SNP. Here’s why.

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Enjoy your daily paper during the campaign. It might not be there next time round

10/03/2015, 01:17:46 PM

by Atul Hatwal

This election will be the swansong of an institution which has dominated the media landscape for well over a century: the daily newspaper.

By 2020, if the trends established over the past five years continue, four out of 11 daily newspapers will likely have ceased print production.

Old certainties will crumble: the Sun will set – it will no longer have the biggest daily print circulation – and the Telegraph’s commanding lead as the most popular of the old broadsheets will almost entirely evaporate.

The papers likely to cease publication by 2020 are the Independent, the Guardian, the Financial Times and the Daily Star.

Dailies cease print 2020 v2

The Independent will probably be the first to end its print run. If the trend in print sales over the past five years continues, then it will literally run out of readers at the start of 2017.

This does not of course mean the Independent will cease to exist. It can continue online but unless the Lebedev family, or a new owner, is prepared to fund the print run of a paper that absolutely no-one buys, there will be no Independent newspaper in a couple of years.

Compared to the Independent, the Guardian seems relatively healthy. With 185,000 daily sales it still has a significant audience. However, by 2020 a combination of the high operating costs of print and declining sales will tip the balance towards the end of the physical newspaper.

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