This week marked the half-way point in the life of the Coalition Government. The Prime Minister and his Deputy used this to confirm that the Coalition would stay together until 2015 and announced a string of new policies they will introduce in the second half.
Alongside a continuing commitment to reduce the deficit, rebalance the economy, reform welfare and education, and support hard-working families, they want to help working mothers pay for child care, with a scheme to deduct £2000 from their tax bills to pay for child minders and nurseries.
First time house buyers will be offered help with mortgages, pensioners will receive a flat rate pension of £140 per week and the personal tax allowance will be raised to £10,000, taking more on low incomes out of income tax altogether. Tougher school standards will be brought in, the NHS will be protected from spending cuts and road tolls will be introduced on some highways to cover the cost of investment in the transport infrastructure. All this was intended to deflect Opposition claims that the Coalition has lost its way.
This week also saw the Second Reading of the Welfare Benefits Up-rating Bill, which will cap the annual increase in most working age benefits at 1% for the next three years. Hitherto these benefits have been up-rated in line with price inflation, but this has meant that benefits have increased at a faster rate than wages over the last five years. That makes work less financially attractive and conflicts with the Government’s policy of encouraging people off benefits and into work. The measure does not apply to State pensions that will increase by at least 2.5% or disability-related benefits that will rise in line with prices.
The Opposition fiercely contested the Bill on the grounds that it will hurt the poorest, both the unemployed and those on low incomes. Ministers countered that benefits take almost 30% of Government spending and had to be cut as part of reducing the deficit and if Labour opposes this Bill they have to explain their alternatives for deficit reduction. The Government won the vote despite a few Liberal Democrats rebelling.
Whilst this was happening a number of charities were telling the Prime Minister that his Big Society vision was dead. They complained that Local authorities had slashed their funding, reducing their capacity to care for the neediest people. The seriousness of this complaint is that the Big Society was Mr Cameron’s overarching vision for the type of society he wanted for Britain. Cutting the deficit, rebalancing the economy, reducing unemployment, controlling immigration, reforming welfare, the NHS and schools are specific policies but they need to be integrated in an overarching vision to tell the nation the sort of society the Government is seeking to create. The Prime Minister needs to make a New Year resolution to recover his Big Society vision and the other parties need to offer their alternative visions to give voters a real choice at the 2015 election.