Reviving Labour's policy programme

Last Friday I was invited to spend the morning with a group of Labour councillors discussing what ideas they should include in their party's next manifesto. Whilst they weren't exactly reaching for the party poppers to celebrate Gordon Brown's anniversary in office, they were surprisingly less depressed than many Labour Party members I bump into in Westminster.

As one councillor explained to me, "we have lots of good ideas, it's just that none of you buggers in London listen to us".

And he was right. In two hours we had a more inspired discussion than many of the Westminster-based debates organised by various left-wing pressure groups and think tanks (and I fully anticipate being thrown out of the think tank magic circle for saying so).


It turns out that Labour is full of ideas. Why not for instance tackle climate change by imposing a windfall tax on the obscene profits of the oil companies and use the money to make our homes more energy efficient? Or put the money into greener forms of energy? Or why not give councils control over local bus services to get more people onto public transport (apparently where bus companies are locally governed, such as London and Nottingham, services tend to be better).


Moreover, to help families hit by the credit crunch, why not allow councils to offer lower-rate mortgages to those under the threat of repossession (as councils can borrow money at a lower rate than banks)? This would allow families to stay in their homes and act as a revenue raising resource for councils.


Unsurprisingly, the "pay as you throw" rubbish schemes and proposals to insert microchips into householders' bins proved as popular as Naomi Campbell at a BA staff party. It turns out apparently that people don't like the idea of the local council sifting through their bins or fining them for not closing their bin properly.


Why not instead, encourage neighbourhoods to reduce the amount the throw away by offering financial incentives for improving their recycling rates or at least provide just one bin for rubbish, which the council can then take away and sort what can and can't be recycled?

Then the conversation moved on to the equally popular Council Tax. Why, they wondered, couldn't the Government take the initiative to show they are on people's side by cutting their bills? A relatively small income tax increase on all income over £250,000 would only target the super-rich and could pay for an across the board cut of around £200 for all householders' bills. 

While we're at it, why not allow councils to offer lower business rates to businesses they want to attract to their area (i.e. new office developments and business parks) and higher business rates on companies that might be detrimental to the area (i.e. fast food shops, bookmakers and vertical drinking establishments)?


If the Government is looking for a few ideas to kick-start its recovery after the summer, they may well want to take a look at these. Alternatively, Ministers may want to spend some of their summer recess going round the country and speaking to colleagues at the front line of delivery. It would seem that Labour has not run out of ideas, but is perhaps not looking in the right place for them.



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Re: Reviving Labour's policy programme (#1)

Interesting stuff, James. I was invited to the meeting but couldn't attend due to another commitment. I think there are a number of ideas that we could usefully develop nationally. I think it says something that local councillors understand that the desire to own a home is still keenly felt by many, even though the current economic conditions might not be allowing it. I don't get the impression that the national Labour government really understand this, and unfortunately that's what the voters seem to think according to the polls. There are innovative things we could do, and allowing councils greater abilities to interevene in the housing market could make a difference.

One of the other things that really struck me was your comments about the "Pay as You Throw" tax. I don't know any Labour councillor that supports this idea as refuse collection is seen as the universal service, the one service that all residents receive for their council tax. Yet Labour councillors are getting it in the neck all over the country by the letter writers in the local press who see it as a local Labour idea. There are other ways to reduce waste (not least by addressing packaging industry excesses) and encouraging recycling and we should follow them, not this unpopular charging system.

Re: Reviving Labour's policy programme (#2)

Why not for instance tackle climate change by imposing a windfall tax on the obscene profits of the oil companies

Well, aside from the fact that this is not a new idea, it's theft. A fair tax system sets out the rules in advance and applies them equally to everyone. Just saying "Gosh, you've got lots of money we didn't expect you'd get, let's take some" is legalised mugging. Even if the victim is rich and unpopular.

 

 Why, they wondered, couldn't the Government take the initiative to show they are on people's side by cutting their bills

Because only rich greedy selfish people believe in cutting taxes, which inevitably results in teachers and nurses being sacked. That's what Labour has been telling us for years, and I for one have come in for a lot of abuse at times for not agreeing.

 

 A relatively small income tax increase on all income over £250,000

You think Gordon Brown didn't think of that years ago? I am not a tax expert but I would be amazed if the "rich" weren't already paying as much as Brown - not a shrinking violet when it comes to such things - believes he can squeeze out of them. Why else would he be taxing the poor? For fun?

 

why not allow councils to offer lower business rates to businesses 

 See previous comments

 

Re: Reviving Labour's policy programme (#3)

Some of the ideas on there are actually fairly good, I don't agree with a windfall tax however, as I think it's a bit much to start smacking people for being a smidge more sucessful than the government didn't realise.

The financial incentives on Rubbish sound like an excellent idea, but are also sounding to me as little more than a rebranded "Pay as you throw" now, if this was coupled with an initial council tax reduction [directly linked to the services provided to a weekly rubbish collection service] I might agree with it, but how would one measure it?

Alternatively one could issue a "rebate" to those who throw away less rubbish, however, one would also have to take into account that families throw away more rubbish than, say, a couple. You could punish families for simply being more people in this method.

Here we've managed to reduce waste quite cleverly and it had cross-party consensus. We have Two bins and a box. The box is for glass and metal, one bin for domestic waste and one for garden waste, we than alternate the bins during the summer months until October when it switches to a weekly kerbside collection of domestic waste. Amazingly it's kept the overall costs down and keeps us all on target to recycle.

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I agree with throwing more money at renewable energy, but not god-forsaken windfarms [Because they don't work]

I also disagree with the Tory proposal of "Micro generation" on a local level, but then again it was Taft who said:

"If you agree with 80% of what I say, vote for me, if you agree with me 100% See a psychiatrist."

We need heavy investment into tidal power instead, we're a nation where we're no more than 100 miles from the coast in East-West direction and the waves pound against us continously, there has to be a lot of energy there we could harness.

While we're at it, why not allow councils to offer lower business rates to businesses they want to attract to their area (i.e. new office developments and business parks) and higher business rates on companies that might be detrimental to the area (i.e. fast food shops, bookmakers and vertical drinking establishments)?

I do beleive that happened here, and the results were mixed. They threw up a lot of warehouses and a couple of factories here where I live and offered lower taxes to attract investment and got some big names such as TNT and Bison, but then there's about a half dozen or more than have been empty now for a year or more. We've currently got a new project now getting "rushed" through to make us a rival with Burton-On-Trent just down the road with a cinema, gym, coffee shops etc.

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Because only rich greedy selfish people believe in cutting taxes, which inevitably results in teachers and nurses being sacked.

Not necessarily. It sounds suspiciously like you pay little or no tax at all, or have no idea at how the money is spent...

This is the mantra being chanted by the Westminster Bubble lot, cutting taxes and not having the funds in place for them results in front-line services being cut.

However, one cannot ignore the "hidden state" apparently "found" by the Tax Payers Alliance, at least 700 million is lost to Quangos and unelected bodies which make arbitrary decisions with no democratic involvement.

Around 790 million per year is lost to funding the Guardian and Independant newspapers with job offers when a dedicated website and proper utilization of the Job Centre network could slash that cost to around 10-15 million.

There is also the legion of middle managers and other personnel within various ministries which could easily be "streamlined" with no detriment to frontline services.

Removal of paperwork also cuts down on cost both time and monetary, allowing the frontline personnel to do more work for their time.

It's not necessarily about cutting the frontline, but cutting down the "back room" staff that don't do an awful lot but get under the feet of the frontline services.

An example. My small local job centre has 2 managers running a workplace of about a dozen personnel where one is necessary.

Other places such as hospitals have several "Supervisors" [which are lower-middle managers] who also double as other workers simply because there's not enough to manage, it'd me more practical to have one full time, full on manager dealing with all managerial problems than 3 "job sharing" ones.

Re: Reviving Labour's policy programme (#4)

Wind farms DO work! Well, they have been proven to in other countries. There has been an excellent tidal power programme off the coast of Northern Ireland, which doesn't seem to have all the problems that sceptics said there would be.

Noone is punishing the energy companies, however, it seems unfair that they are profiting hugely at a time economic woes for people. Maybe a fairer concencus would be to target the oil price speculaters, and the stock market speculaters, who noone can deny are profiting out of other people's misery.

Re: Reviving Labour's policy programme (#9)

Wind farms are alright only up to a point. The problem is the frosty days sitting under an anticyclone in the depths of winter with no wind and peak demand. Wind power is therefore limited to a modest percentage and you need backup to kick in when the wind is not blowing.

What has been driving the increase in wind power is the cheapness of setting it up.

Tidal power can be more constant and predictable of course.

Re: Reviving Labour's policy programme (#5)

It would be nice to see that someone had done some sums or forward thinking:


Sums:
"A relatively small income tax increase on all income over £250,000 would only target the super-rich and could pay for an across the board cut of around £200 for all householders' bills. "

With 11+ million households that is £2.2 Billion.

A small tax increase? say 5% extra tax: raises £12,500 per every £250,0000 earned: That means you need to have an aggregate 176,000 people earning an average taxable £250,000.

There are only 4 million Uk taxpayers paying 40% tax.

I doubt your 176,000 people exist.


Thinking
"Why not for instance tackle climate change by imposing a windfall tax on the obscene profits of the oil companies"
 
Yes.. tax them more. They will all move offshore because most of their profits are earned outside the UK.


How about spending less?

Because.. make no mistake.. with an ageing population to look after, that is the simple choice: tax more and drive busines away or cut costs.

I did not see any thought about addressing food prices : like encouraging local agriculture   or fuel saving: by car pooling .

An incremental approach based on new new money -no new taxes... has got to be the basis.

Or do you really think with food and energy inflation that anyone will accept more UK taxes?

Labour needs policies which have a chance of working and being implemented.

Tax and spend is what we have had 10 years of: it has failed and screwed up the economy and yet you still seriously put it forward as a policy.

Unbelievable.

Re: Reviving Labour's policy programme (#7)

You know what I don't understand? We have some of the lowest tax rates in the Western World. Other countries have high tax rates, and they have successful businesses. Why does Scandanavia still have Nokia, Ericsson, Volvo, and other thriving companies? Why does the rest of Europe continue to have thriving banks and oil companies, when they have higher tax rates? Why do they have higher standards of living

Noone has yet answered my point about why other countries still have high standards of living, and why Scandanvia dominates the top 10 of GDP per capita, and still have high economic productivity, with srong welfare states.

Indeed, we can close the tax havens, but with an international effort. However, we have significant leverage in this area, as around half of the total assets of the world's tax havens are in British territories and dependencies.

If Eurosceptics hadn't been against democratic accountability being increased, then food prices would've dropped. If the treaty had been ratified, we would have seen the European Parliament quickly vote down the CAP they have always hated. Protectionism for the richest farmers in the world not only ruins Africa, but it is not good for food prices.



Seriously, you really think tax and spend has ruined the world economy. Lets look at what we can learn from the global experiences. The sub prime mortgage market collapsed. This is a Thatcherite hangover. We have the most deregulated mortgage market in the world. Soaring mortgage levels combined with rip off interest rates now leave 2 million Americains at risk of becoming homeless. The banks knew default and foreclosure rates would soar, but their profits were simultaneously soaring. They kept all of this off their balance sheets.


We have thrown consumers rights on the bonfire, and this is what has caused the housing market collapse in America, which is the trigger. 


Here's another Thatcherite cause of our woes-Northern Rock. Matt Ridley (who supports repealing food safety laws) thought that the idea that substantial saver's deposits should finance lending schemes was rediculous.

John Caine, former director of corporate affairs at Alliance and Leicester, explains: “If government is to blame, then it is that led by Margaret Thatcher [and her] determination to deregulate the UK financial markets.”


The Cruickshank report told us this would happen, and offered a solution to fix it. It said we should have utility style regulation over the banks to prevent a crises like this.


Re: Reviving Labour's policy programme (#6)

Anyway, ignoring the above post (because it is apparently extra funding for the NHS which has screwed up the world's mortgage market), I think we need to pick some pitch battles with the Tories.


Let us look at the Tories weapons. They make everyones lives slowly worse when they get into local power, then they cut council tax and say "Look how clever we are."


So, lets reform council tax. Make it a local income tax. It redistributes money from the rich to the poor. It tests the Tories: either they support the fairest way to reform the council tax, or, they are against it and it exposes their hatred of council tax is an electoral weapon. A shrude Labour would then be able to remind the electorate of the disgraceful poll tax.


There are other battles, which would quickly send their supposedly liberal masks slipping.

Re: Reviving Labour's policy programme (#8)

I think a local income tax is a great idea.
Bring it on.

Now lets see: the porrer councils will have no (or relativley few) high rate taxpayers - cos they have all moved into the suburbs. So the base rate taxpayers will have to pay loads: cos there may be LOTS of people on benefit who will pay nowt.
Great idea.. Tax the base rate payers a lot.

As a non taxpayer it will save me £000s. And based on a local tax I will never pay anything. Great.

And of course, the rich will move to where local taxes are least, thus making those local authorities who are spendthrift - or who have lots of people on benefit - lose £millions.
That means most inner city areas will have councils who go bust including most of London,Glasgow, Manchester and other Labour contriolled councils.

And od cours ethose areas with lots of millionaires.. but low benefit claimants - and less need for social services like the City of Westminster - will have low taxes.

Yeas.. great idea:-(


Re: Reviving Labour's policy programme (#10)

The real question is not whether these councillors have good ideas.  How is it that there is no debate within the party about policy?  How, if at all, do NPF members communicate with the people who elect them?  Why are the party policy documents treated as if they were secret, though we can read about them in the Guardian?

Re: Reviving Labour's policy programme (#11)

Thanks very much to everyone for commenting. I think LabourHome works best when we can generate genuine debate. I'll try to respond to all your points:


- On the windfall tax idea, I disagree with the assumption that it represents "theft". Are you Adam Smith in disguise? Labour has introduced a windfall tax on excess profits before and it is clear that oil companies and energy providers have seen their profits boosted by the high price of oil. The companies would not have anticipated this windfall so will not exactly go under if they lose it. 

- On the increased tax on earnings over 250k - the figures are from here  http://www.nlgn.org.uk/public/press-releases/taxing-super-rich-could-pay-for-widespread-council-tax- cuts/.
I think that the general public make a distinction between the rich and the super-rich and would not argue against a small tax increase on the latter (as they didn't over the Conservative non-doms proposal).

- Is tax too high? You could certainly argue that levels of council tax have reached too high a level and that people are struggling to pay their bills. Fundamental reform would be ideal but there doesn't seem to be any appetite from either Labour or Tory to do so. The plan to reduce average bills by £200 would not make council tax anymore equal but would at least reduce the burden on ordinary families.

- On business rates, councils currently have no discretion on business rates, although they will soon be able to increase them by 2p in some circumstances. Why not give councils greater freedom over their local economies? Wouldn't it be great for a council to offer lower rates to not-for-profit and community organsiations who wanted to set up a business in their local area? What's so wrong with that?  

- Couldn't agree more on the point about reducing the quangocracy. Why can't we get rid of some of these bodies, such the taxpayer money and return their powers to central and local government?

- I don't feel qualified enough to take on the question of windfarms but I would say that any windfall could be used in other ways such as paying to provide insullation in homes to make then energy effiecent.
 
- Finally, on the point about the manifesto process, you make a fair argument. There are some really interesting manifesto groups undertaking some great work but I wonder sometimes whether enough people know about them. Maybe it's time to bring back the Big Conversation which, for all the cynicism, did bring forward some interesting policy ideas, e.g. the smoking ban. 

Anyway, thanks again for your feedback.

James