The right’s tax and spending cuts will benefit the few and hold deprived regions back, John O’Farrell contends.
“My job is not to worry about those people.” The comments we heard last month from Mitt Romney about how 47 per cent of Americans are “takers” who can never be convinced that “they should take personal responsibility and care for their own lives” tells us much about the contemporary right and who they really worry about*.
On this side of the Atlantic, we can clearly see who the Tories worry about keeping sweet. Lord Leveson’s inquiry into relations between the Murdoch media, the police and Tory politicians revealed a family tree of interests and attitudes. The revelations about the Hillsborough disaster and the smear campaign against its 96 victims only confirmed the long roots of that particular nexus.
A similar nexus operates in the slick new economy of outsourcing and advanced financialisation: hedge funds, private equity, derivatives trading, tax havens, the Private Finance Initiative and the Big Society. The latter was promoted as the big chance for the ‘little platoons’ to take local control of welfare and services from the impersonal state. What it has resulted in so far is huge contracts under the Work Programme to well-connected outsourcing specialists such as A4E and Serco, and PFI deals seeing billions of taxpayers’ pounds pour into the pocket of City insiders who then shunt their profits into tax havens.
Far from the bucolic image of Conservative grandees being farmers or manufacturers, the reality of the modern Tory donor is less class, but more cash. The majority of party funders are from this ‘investor class’. Lords Ashcroft, Beecroft and hedge funders Jonathan Boyer and Nicholas Allan, are presently facing a combined £11.5 million tax bill after a tribunal ruled against an offshore tax scheme they employed. Their lobbying on the Vickers recommendations of banking are more likely to matter, as Sir Mervyn King admitted on Channel 4 News.
Against this, small corners of the UK which don’t elect Tories do not count. This is why ‘reform’ is so advanced for welfare while timid suggestions about the financial sector are diluted and delayed. If this government slashes £18 billion from welfare across the UK, £750 million will be cut each year from Northern Ireland consumers. Add over £500 million annually if they get their way on imposing regional pay on public sector workers.
Meanwhile, Gideon ‘George’ Osborne has still managed to find enough money to cut the 50p tax rate giving 40,000 UK millionaires an average tax cut of £14,000 per week. The gross disposable household income of Northern Ireland’s residents was the second lowest in the UK at £13,600 per head in 2010, and it hasn’t improved much lately.
The 1,000 richest persons in the UK have increased their wealth by so much in the last three years (£155 billion) that they themselves alone could pay off the entire UK budget deficit with this increase and still leave themselves with £30 billion to spare. Few of those plutocrats live in Northern Ireland. The vast bulk reside in London and the South East (except for tax purposes, obviously).
What is happening is the increased concentration of power and wealth into smaller corners of the state and the economy. The nations and regions don’t matter, as even those who desperately cling to hope of a devolved cut in corporation tax must acknowledge.
We see the same insouciance from the centre when it comes to EU funding. At present, the UK is negotiating on our behalf on the EU’s budget for 2014-2020. By some accounts it is taking a very hard line which could see a dramatic drop in funding designed for Europe’s poorer and ‘transitional’ regions, of which we are one. Less money for Structural Funds or PEACE IV will impact on our infrastructure and competitiveness, especially after a 42 per cent cut in capital spending from George Osborne.
It is now clear for all to see that the Coalition Government’s austerity measures are damaging the economy and society. The trade union movement and many respected and Nobel Prize-winning economists warned them that austerity would not work.
They don’t care for us, so people should care enough to send them a message on Saturday 20 October, and join with the trade unions’ call for a better and fairer way.
