Posts Tagged ‘Callum Anderson’

If Labour wants to tackle inequality, it’s a land value tax, not the 50p rate that’s needed

29/01/2014, 08:48:37 PM

by Callum Anderson

Anyone who read Oxfam’s report this week, which revealed that the 85 richest people in the world possess the same level of wealth as the poorest half of the global population, would have been  shocked at the magnitude of global inequality. Things aren’t much better here in Britain. Just 189,000 families (roughly 0.6 per cent of the UK population) own two-thirds of the UK’s 60 million acres.

The what-who-how much elements of taxation are ones which have always been fiercely contested by Labour, Conservatives (oh, and Lib Dems) alike. However, as wages stagnate, the gap between rich and poor grow larger by the year, Labour should grab the initiative in this debate. However, instead of pursuing a somewhat one-dimensional tax policy in calling for the return of the 50p tax rate post-2015, the two Eds could, and must, be bolder in laying out a plan that not only yields the most revenue, but also begins to adequately address the inequality that stains our society. But one thing is clear – heavily taxing income is likely not an efficient way of doing this; instead, it is wealth that any future government must concentrate on.

As that great redistributionist, Winston Churchill, put it speaking in the House of Commons in 1909:

“Roads are made, streets are made, services are improved, electric light turns night into day, water is brought from reservoirs a hundred miles off in the mountains – and all the while the landlord sits still. Every one of those improvements is effected by the labour and cost of other people and the taxpayers. To not one of those improvements does the land monopolist, as a land monopolist, contribute, and yet by every one of them the value of his land is enhanced. He renders no service to the community, he contributes nothing to the general welfare, he contributes nothing to the process from which his own enrichment is derived … the unearned increment on the land is reaped by the land monopolist in exact proportion, not to the service, but to the disservice done.”


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Want a fairer tax system? Merge national insurance with income tax

09/01/2014, 08:30:44 AM

by Callum Anderson

One of Ed Miliband’s biggest successes of 2013 was shifting the political argument towards the cost of living crisis. Whilst this will not be sufficient to win the economic debate against the coalition government, it is still likely to be a significant battleground in the run-up to the next general election, as wages continue to stagnate and the cost of living rises, despite signs that unemployment is falling and that economic growth is (finally) beginning to be restored.

Indeed, by May 2015, Ed Miliband could be well set to ask the voters: “Are you better off than you were five years ago?”

Naturally, an aim of a government (and certainly that of a Labour government) should be to increase the money that low and middle income earners have in their pockets. They are more likely to spend more, which will subsequently lead to positive benefits for the economy. Much progress has already been made in increasing wages through the minimum wage (although, of course, a living wage must soon be implemented), as well as increasing the tax-free personal allowances (for which credit deserves to go to the coalition government). One way of improving the living standards of low and middle income households is through the tax system. Tax cuts aimed at the poor are good because they encourage work, reduce the welfare bill, and helps poorer people to be better off.

And the clearest (not to mention the simplest) way of achieving this? Merging National Insurance contributions (NICs) with income tax. I believe that not only would we be able to help millions of the country’s lowest earners, we would also be able to create a fairer tax system that ensured that everyone pays their fair share, as well as making tax avoidance more difficult.

Currently, employees pay income tax on earnings over £9,440 per annum (increasing to £10,000 in April), yet begin to pay NICs when they earn more just £7,748 per annum. Clearly, this is significantly lower than the personal allowance for income tax, despite both being deducted from the same pay packet: NICs are essentially income tax 2.0.


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If Dave thinks Merkel will ride to his rescue on Europe, he doesn’t understand German politics

23/12/2013, 11:18:25 AM

by Callum Anderson

After three months of intense negotiations, Germany finally has a new government. Angela Merkel’s CDU/CSU centre-right party will enter a so-called ‘Grand Coalition’ with the centre-left social democrats, the SPD, after its members ratified the agreement in a vote a week ago.

The arrangement, however, could represent the proverbial ‘spanner in the works’ for David Cameron’s plans to repatriate powers from the European Union to individual member states. Although Mr Cameron does have a natural ally for EU reform in Chancellor Merkel, her coalition partners, the SPD, are likely to prove a substantial stumbling block for any attempt by Ms Merkel to collaborate with the prime minister.

For a start, the Euroscepticism of David Cameron’s Conservative Party is completely at odds with the staunchly pro-EU stance of the SPD. A German government, with SPD involvement, will almost certainly take a dim view of any potential “Europe a la carte” arrangement that the prime minister seeks, especially in regard to social regulations such as the working time directive. Indeed, it is highly likely that it will actively try to block attempts to return EU powers to national governments.

Difficulty also represents itself in the form of the new foreign minister, Frank-Walter Steinmeier, who also served in the same capacity in the last ‘Grand Coalition’, between 2005 and 2009. Steinmeier not only frequently scuppered Merkel’s foreign policy plans during that time, but is also considered one of the Social Democrats’ closest links to the French Socialist party. Indeed, Steinmeier is reported to have said in December 2011 that he expected the UK to leave the EU, remarking that, “I fear the decisive step for Great Britain’s exit has already been made. If the regular meetings take the form of a Europe of 26 without Britain, then a process of alienation will become inevitable and irreversible.” It is therefore likely that he will not idly sit by and let Angela Merkel freely negotiate with David Cameron.

The possible ramifications of SPD hostility are obvious. By blocking Angela Merkel’s attempts to work with the UK on a new relationship between the EU and its member states, the SPD will deprive David Cameron of a possible key ally in claiming powers back from Brussels. If Germany is unable or unwilling to work with the UK prime minister, other Northern European states such as the Netherlands and Sweden are also likely to become sceptical. Similarly, any significant strengthening of Franco-German relations could further weaken London’s hand.


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Heads, not hearts, must guide UK drug policy. We must decriminalise now.

16/12/2013, 09:17:20 AM

by Callum Anderson

The decision by the Uruguayan government to legalise the production, sale and consumption of marijuana – becoming the first country in the world to do so – has been widely reported in the media. With this in mind, how governments all over the world tackle drug use and drug addiction has been thrust back into the spotlight. Indeed, it is one of the most emotive and polarising issues in politics.

Many experts, including the International Centre for Science in Drug Policy have concluded that the so-called ‘war on drugs’ cannot be won. Indeed, I believe that the time has come for drug policy to be led by our policy makers’ heads, and not their hearts. Drug use and drug addiction must primarily be treated as a public health (and an economic) issue, not a criminal one.

It is an indisputable fact that drugs affect all of us, whether directly or indirectly. There are many of us, who have witnessed the stranglehold that drugs can have on an individual. It is, of course, a somewhat more painful experience if that individual is a relative, a friend or a partner. The seemingly unstoppable unravelling of ones life. The growing disconnection between the addiction and what really matters – family, work and friendship – is truly agonising.

In addition, there are indirect costs. Research by the Home Office has found that the economic and social costs of drug use are estimated to be around £15.4 billion a year in England and Wales alone, with drug related crime constituting 90 per cent. These facts are reflected in the Ministry of Justice’s figures, which show that the custody rate for drug offences have risen from 16.9 per cent in 1993, to 17.3 per cent in 2011, with the average custodial sentence rising from 28.3 months to 31.3 months in the same period. This has resulted in 14 per cent of prisoners being incarcerated due to drugs.

I do not deny that the case for decriminalisation is a tough sell to the British public: recent polling suggests the majority of people support the current law, which criminalises the sale, possession and use of drugs.

What then, does this all entail?

Well, let’s take a look at Portugal.

In 2001, the Portuguese (centre-left) government took the step of decriminalising the possession and use of drugs including cocaine and heroin. Instead of seeking to diminish use by punishing users, the new measures considered drugs illegal, but no longer treated drug consumption as a criminal offence. In addition, Portugal’s drugs reforms included a wide range of measures such as prevention and social education to discourage the use of drugs, as well as providing treatment for drug dependent people and assisting their reintegration into society.

So, what happened to drug usage rates in Portugal?


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Labour must hope that Cameron and Osborne do not have Merkel’s political nous

03/12/2013, 07:00:45 AM

by Callum Anderson

On Thursday, George Osborne will give his penultimate Autumn Statement before the 2015 general election. It is likely to be a highly political Autumn Statement. But whilst most of its content has yet to be leaked (at least at the time of writing), save for the likely rolling back of green levies – an attempt by the coalition to tackle the “cost of living” crisis – there is still scope for the prime minister and the chancellor to create huge problems for Ed Miliband and Ed Balls, if they can demonstrate that they are beginning to understand the economic concerns of voters, and shift to the centre ground.

Hopi Sen has already entertainingly set out how Osborne and the Conservatives could steal a march on the two Eds on the ‘cost of living crisis’. Increasing the minimum wage above inflation each year for the next five years, subject to the advice of the Low Pay Commission; raising the tax free personal allowance by £500 each year, and thus lifting millions of people from the burden of tax; reintroducing the 10p tax rate temporarily, benefitting all full-time workers on the minimum wage; and announcing an immediate cut in domestic energy bills, funded by a tax on overseas buyers of expensive property, are just a few measures that would leave the Labour hierarchy scratching their heads as to how to respond.

Indeed, such a strategy has been expertly executed by Angela Merkel, the German Chancellor, since she was elected in 2005. Her Christian Union party (CDU) – Germany’s conservative party – has been the lead partner in the previous two coalition governments: first with the Social Democrats (SPD) between 2005 and 2009, and second with the Liberals (FPD) between 2009 and 2013, and is set to enter another Coalition with the SPD within the next month.

Ms Merkel has been particularly adept in not only keeping the CDU resolutely on the centre ground of German politics, but also shifting the balance of responsibility disproportionately to her junior coalition partners. For instance, during her first term, Ms Merkel astutely took advantage of the unwillingness of SPD members to enter a coalition government with her own CDU to, in the first instance, solidify the “Hartz” labour market and welfare reforms of her SPD predecessor, Gerhard Schroeder, as well as ensure that both parties shouldered the responsibility for the substantial austerity measures taken in response to the 2007-08 financial crisis.

Likewise in her second term, Ms Merkel has been, perhaps too successful, in allowing the FDP to shoulder much of the blame in the slow response to the Euro crisis of the last few years. I say too successful because the FDP, who have traditionally had more in common with the CDU than any other party in the German parliament, crashed at the federal elections in September to such an extent that they have no seats for the first time since 1945.


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Britain needs to have a grown-up debate on immigration

19/11/2013, 06:50:50 PM

by Callum Anderson

Marks & Spencer. Selfridges. EasyJet. Tesco. Know what these iconic British brands have in common? That’s right, they were all established by immigrants. Immigration has always been one of those issues that has never quite completely left the consciousness of British politics. However, over the last ten years, the issue of immigration has become more nuanced: unfortunately the standard of debate has not.

One Nation Labour must begin to not only tackle the right of the Conservative party and the reactionary media (I think you know who I mean), but also the legitimate concerns of citizens, some of who have become concerned with the scale of immigration. There are two vitally important elements that we, as a country, must consider: the first is to decouple race from the immigration debate, and secondly, that economic and social considerations must both be taken into account when devising policy.

But first, let’s take a look at the facts. Britain has undoubtedly benefited from immigration. Almost all Brits, regardless of background, glowed with pride at the country’s diversity displayed during the opening ceremony at the London Olympics. Whether it be through literature, cuisine, music or sport, Britain continues to lead the way in welcoming, and assimilating (although sometimes slowly) new immigrants. And the evidence shows that immigrants more than pay their way.

Recent research by the Centre for Research and Analysis of Migration (CReAM) has showed that between 2001 and 2011, European Economic Area (EEA) immigrants made a net fiscal contribution of £22.1 billion to the UK public finances, whilst non-EEA immigrants made a net contribution of £2.9 billion. In other words, immigrants contributed far more in taxes and economic output than they took back in benefits. This is to be compared to us natives, who cost £624.1 billion during the same period.


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Britain needs to be at the heart of a reformed European Union

07/11/2013, 05:10:55 PM

by Callum Anderson

“Geography has made us neighbours. History has made us friends. Economics has made us partners, and necessity has made us allies. Those whom God has so joined together, let no man put asunder.”

That was president Kennedy addressing the Canadian parliament in 1961. However, to me, those words also hold particular resonance with Britain’s relationship with the European Union. As is well known, the prime minister has already made a commitment to giving the British people a referendum on British membership of the EU in 2017. The argument is set to be intense: I’d like to set out why Britain must retain its EU membership.

If Britain wants to be prosperous in the 21st century, it must engage not only with countries such as China, India and Brazil, but also with EU members. But what has the EU achieved during Britain’s membership? It has continued to maintain the peace, helped to bring down the Berlin wall and the iron curtain, and welcomed new states from across Central and Eastern Europe into the EU family. Moreover, hundreds of thousands of Britain’s take advantage of our EU membership every year.

According to Eurostat, the EU’s independent statistics office, 711,151 UK citizens lived in other EU countries in 2011, whilst the British Council has stated that 9,095 UK students participated in the ERASMUS programme, the exchange programme allowing young Britons to study in other EU countries not only free of tuition, but with the help of a grant from the EU. Moreover, without the EU, British workers wouldn’t have a range of protections that they take for granted including, but not limited to: a maximum number of working hours, guaranteed breaks and protection against being forced to work long hours.

Britain and the EU are, like it or not, bound together economically. Now, there are many who say: “If only Britain left the EU, it could simply join the European Free Trade Area, thus maintaining the current economic ties, whilst freeing itself to seek free trade deals with other countries – most notably the Commonwealth countries, the United States and China.” Sounds good, right? Well, if anything ever sounded too good to be true, then this is it.

First, it is important to note that a little over half of the UK’s trade is done with the EU; it just makes no sense to leave an economic trading bloc which we are so dependent on. Were we to just leave (almost certainly in controversial circumstances), than whilst it is unlikely that we would be economically cut off, it would be too dangerous to assume that countries such as France and Germany would allow British businesses to enjoy the same advantages of market access, as it does now.


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