MARCUS FYSH: Tories are the party of low tax – we lose that reputation at our peril
Marcus Fysh is Tory MP for Yeovil
The Prime Minister deserves praise for his energy and compassion in putting care for those who find it hard to look after themselves at the top of the national agenda.
But the ill-thought-out tax rise plans foisted on Conservative MPs last week are deeply flawed and have caused deep upset in the party.
The scale of the rebellion in the Commons last week, with nearly 40 Tory MPs abstaining, was proof of that.
We are, by tradition, the party of low tax.
We abandon that hard-earned reputation at our peril.
In the last few days, I have spoken to many other Tory MPs who share my deep concerns at the approach the Government is now taking.
And I must warn that without much greater explanation and concessions, the Government faces a potentially much greater rebellion from the Tory benches when we vote on the full Health and Social Care Levy Bill this week.
Of course, it is vital that we get our response to these challenges of reforming social care provision right.
But I believe that reaching for big tax levers is risky, as the broad drag on people’s incomes and spending might well hinder the way they can help us pull through.
It could well depress tax revenue that we need to grow fast to match demand for public services and repair our groaning balance sheet.
We also need actually to fix social care, and get it more capacity now to enable the NHS to discharge patients into the community, recover and clear the backlogs. The current plan in that respect needs more work, and it would be fairer for the wealthiest retirees, who sometimes have assets that have risen greatly in value and high pension incomes of types no longer available to those of working age, to make more of a contribution to their outsized generation’s need.
There is a way through, but it needs honest clear eyed thinking about the big picture as well as practically detailed measures.
People believe National Insurance contributions have been about pooling resources to provide for the future, but this has not in fact been the case for a very long time. They have rather been used as soon as they are collected to pay for present spending on current year ‘entitlements’, and to obtain credit against future generations for even more, in the form of debt.
Most western Governments have spent the last decades running such arguably Ponzi-like schemes, while pretending that all is OK. It is not.
The debt is increasingly having to be bought up with central bank money to be affordable, and the purchasing power of the pound in most people’s pockets – unless they are lucky or have worked hard enough to have assets – keeps ebbing away.
The Prime Minister deserves praise for his energy and compassion in putting care for those who find it hard to look after themselves at the top of the national agenda. But the ill-thought-out tax rise plans foisted on Conservative MPs last week are deeply flawed and have caused deep upset in the party
In my view we must look to the roots of the modern social construct and its radical and Christian traditions. to find inspiration for modern Conservatism and indeed liberal, social democracy in how to deal with this.
The philosophy, if not always best execution, of looking after each other responsibly is right before our eyes, in the first trades unions, the mutual and friendly societies, the cooperatives that Disraeli recognised as important innovation in help for each other and young Churchill crossed the floor to support as the Liberal government looked to provide them with national assistance.
They pooled resources, in one way or another, to look after each other and themselves in the future, not by taking on debt but by cooperating and investing.
So if we are going to expand National Insurance now let’s reform it so it actually means what it says.
The most powerful weapon we have against the debt problem we have is the power of compounding investment returns.
The modern digital world offers new ways of pooling savings, investments, insurance, and help for each other without middle men, counterparty or management risks and costs.
We should be imaginative in engaging or subsidising these for social care, and rebate any currently proposed extra levies to those who participate and are adequately provided for in such ways.
Above all, let’s make providing for ourselves and our parents and grandparents cheap for those who can least afford.
Marcus Fysh is Tory MP for Yeovil.
Source: Read Full Article