The Future of Politics. Charles Kennedy
This would, combined with an audit of their environmental performance, and the traditional Budget, establish a ‘triple bottom line’. The government is already encouraging ethical companies to report upon these aspects of their yearly performance; maybe it should learn the lesson itself.
Such an audit would have to be genuinely independent of government, and carry significant weight behind its conclusions. A variety of bodies would be consulted in its creation, and a panel of respected independent figures would be established. It would include representatives of, for example, the Economic and Social Research Council, the Bank of England, the CBI, the BMA, the National Audit Office and the Audit Commission. Not all of these bodies are primarily associated with the cause of social justice, and so they would not be seen as having axes to grind, but they could all provide significant expertise at evaluating evidence produced by government departments. In addition, they would be supported by a permanent team of researchers, independent of any government department, whose job would be to examine the figures produced by government. With such support, finding any inaccuracies in government figures would not be difficult – as Liberal Democrat researchers regularly prove even without such support. This would be an enormous improvement upon the government’s present self-congratulatory Annual Report, an exercise which ranges from the anodyne to a brazen attempt at political propaganda at the taxpayers’ expense. Mercifully, nobody appears to pay much attention to it.
What would this audit look like in practice? It would begin with the announcement of Bills in Parliament. Take some of those put forward by the government in the final Queen’s Speech of the last century, November 1999. The audit would apply two key questions to them. First, how would different parts of the country, and the inequalities between them, be affected? Second, how would the inequalities between social groups be affected?
Measures such as the Care Standards Bill, intended to promote better care for the elderly, would have to include information on how those measures would affect people with different incomes and savings. If the Bill increased the access of people on low incomes to high quality care, then it would pass the Social Justice Audit. As the Bill presently stands, it would not pass, and nor would the Electronic Communications Bill, which does not consider how disadvantaged groups can take advantage of new technologies, nor how government can encourage them to participate.
The Social Justice Audit would be similarly scathing of government transport policy, which has not met its targets for traffic reduction, and has decreased spending on public transport. This is a social justice issue just as much as it is one of the environment, for car ownership is only possible for people above a certain level of income, and those below it have to rely on public transport. We need to subject every government policy to intense scrutiny if we are to have a more informed debate on the inequalities in Britain, which goes beyond mere questions of tax and benefits.
I do not pretend for one moment that a Social Justice Audit would solve all of Britain’s social problems, but, given sufficient priority by government, it could change the nature of our political discourse, so that politicians would be forced to be clear about how they will tackle definite inequalities, and be held accountable when they don’t deliver. If a Bill is judged to have failed, it might be automatically rescheduled for reworking in Parliament. The Audit would also highlight the extent to which social justice is affected by a wide range of policies – a fact often overlooked. For example, in terms of the environment, poorer areas suffer most from pollution.
Refocusing politics and reshaping our political language, so that politicians reconnect with the real concerns of millions of ordinary people, will have a tremendously positive impact on the quality of our democracy. It will give genuine meaning to politics, for people who at present feel that it has little to offer them. Otherwise we face a future in which 25 per cent election turnouts are seen as the norm, rather than a cause for concern. And we will continue to live in a Britain in which privilege, rather than ability, determines the achievements and the resultant quality of life.
Tax for Freedom
New Labour is reluctant to mention the word taxation, except, of course, to claim that it is coming down, but if we accept that every citizen of our nation has a right to first-class education, to comprehensive health care and a welfare safety net, then we also have to accept that we all have a responsibility to make those priorities possible. They cannot be achieved without radical changes in the way our taxes are applied and collected. To pretend otherwise is simply to con the voters.
I am not arguing for a simplistic ‘high taxes, high public spending’ model. I believe that the main increase should be in terms of efficiency. Increased efficiency in the way taxes are imposed, gathered and, most importantly, spent. Four guiding principles should govern all socially responsible policies on taxation.
The first is adequacy: taking exactly and only what is needed, from precisely those who can give. Penalizing the successful only deprives the nation of entrepreneurial talent. Bleeding the rich dry as a policy has more to do with old-fashioned antipathy – what Winston Churchill called ‘cool-blooded class hatred’ – than the search for social equality. At the same time, government cannot be starved of the money it needs to pay for good schools and teachers, quality health care, adequate pensions and people in need. That is why I urged the present government to spend its 1999–2000 budget surplus on the public sector, instead of sweetening the least needy sections of society with tax cuts and patching up the shortfall with the surplus cash.
That is also why I greeted Gordon Brown’s 2000 Budget with scepticism: £1 billion goes into education, but £2.6 billion is devoted to a further cut in the basic rate of income tax – a clear indication of Labour’s priorities. The Budget will do nothing to provide nursery education for all three year olds, and little to reduce class sizes in our secondary schools, or to address the backlog of repairs. Nor will it do anything towards abolishing or reducing tuition fees for higher education, or addressing the massive gap between the needs of business and the training on offer.
Physics tells us that matter can never be destroyed – it simply converts into other forms. Similarly, in politics you can never cut taxes unless somebody else pays. In the case of New Labour policy, much of the tax burden has shifted away from income tax and on to council tax, which has risen by a third in four years. Much of the pain will also be felt by the young and the old, as education loses out, and as do the pensioners, who received the staggeringly generous sum of an extra 75p a week. The only provision of extra money for pensioners was in a small increase (£50 – less than £1 per week) on the one-off winter fuel payment, when it is clear that what is required is an increase on weekly income across the board. That would be far more empowering than handouts on fuel. Perhaps the only consolation we could take from the Budget was that things would have been far worse under the Tories, but still, current Labour taxation policy does not satisfy the criteria for adequacy.
The second principle for responsible taxation is honesty. Politicians need to be straight with people about the choices involved. It is simply not acceptable to say, as William Hague’s Conservative Party has done, that you can have tax cuts and more spending on schools and hospitals. That is an implausible position to take, and one clear indication of why the Conservative Party has become so irrelevant. In the run-up to elections, politicians must tell the public precisely how much their programme of public sector spending will cost, and how it will be paid for. Wherever they wish to introduce new taxes or set different levels they must explain exactly why the changes are occurring, and where the new money is going.
Liberal Democrats have produced a fully costed manifesto at both of the last two general elections. We have shown how much our plans would cost, and how we would pay for them. Some people have responded to this by saying, ‘You can afford to be honest about it because you’re the third party.’ But being the third party does not mean we can get away with being out of touch with the mood of the nation! Our decision to be honest about taxes is based on an awareness that this is what the nation wants.
When we first proposed that we would, if necessary, raise taxation by 1p in the pound to pay for investment in education, commentators believed it would be unpopular. It was the subject of much passionate debate within the party before the 1992 General Election.