The FishTank

Archive for May, 2010

Back before the election I was watching a debate about funding for long-term care and I happened to be annoyed by hearing an unusually fatuous remark from Charles Kennedy. I didn’t have time to address the issue then, but I thought I’d bring it up now as the issue is still one of importance. What Charles Kennedy said was that the issue of funding for long-term care wouldn’t arise if we weren’t – as a nation – so obsessed with the ownership of property.

Just think about that statement for a moment. What Kennedy was saying was that the current position where we force people to sell their homes in order to pay for care wouldn’t exist if they didn’t own those homes in the first place. It’s rather like saying we wouldn’t have a problem with waiting lists for cancer patients if we didn’t bother treating people for cancer. It’s frankly nonsense and it’s typical of a kind of I’m alright Jack, pull up the ladder attitude that you see more amongst rich socialists than capitalists. It’s the same mentality that allows a grammar educated Labour minister to be opposed to the continuation of such schools, especially when their own children are either in private education or they have carefully short-circuited selection processes to get them into the best state schools.

It’s also of a piece with the continual narrative about the Conservative’s – currently moribund – policy on inheritance tax. Far from highlighting the people whose houses have skyrocketed in value more by accident than by design (the same people whose example forced a revision of the Lib Dem mansion tax) the New Labour spin machine highlighted only a few thousand people, all of whom are presumably at death’s door given the way the tax break was continually equated with plans to cut the deficit over the next parliament. Anyone who has done well in spite of New Labour is, it appears, to be censured rather than congratulated. Or even better poisoned and then taxed to fund the latest government fiscal bonfire. Thankfully we’ve had a change of government and this attitude is on the way out.

I am, admittedly, somewhat ambivalent about inheritance tax: I don’t think it’s healthy for one’s offspring to be loafing around waiting for one to die and hand them a fortune, but that doesn’t mean I think the State has a duty to take the money away for the good of said offspring. The truth, however, is that sending a signal to people that if they go through life as a wastrel they are more deserving by the State than someone who works hard and saves their money is the kind of thing that disincentivizes work and creates the welfare dependency culture that has been fostered in our country. In the end it costs less to allow people to keep their wealth than to pay for all the people who, seeing no prospect of wealth, decide to live on handouts.

I don’t propose to handle the long-term care issue here, although some of my conclusions may feed into that debate. For the care issue to be resolved we need first to know whether the current care provision is cost-effective or merely profiteering from emotionally vulnerable people. Should it really cost more to live in care than it does to live in the Savoy or to be kept in a top-security prison? I suspect not, but I don’t have the figures to prove my suspicions.

Property, however, is more easily argued from principle. There are, after all, only three very simple cases for people’s residential arrangements: private ownership, private rental or public rental. Often, when you see a politician or a pundit making mileage out of this country’s ‘obsession’ with property they appear to be favouring private rental. My instant thought is that they either own rental property or would like a system which favoured rich people like themselves who wished to do so. Because, for the tenant in rented accommodation, private rental is the worst of all worlds: continually under threat of increased rent, often unable to make those changes which make a home one’s own, subject to the whims of the landlord when it comes to maintenance. Usually when you start renting a property the rent will be fixed at a rate higher than the same property would cost to mortgage. This doesn’t change as the owner’s mortgage is paid off, either. Rents move up as the prices rise, with even established owners putting their rates up inline with the market. If this weren’t the case then a council house sold off in 1980 (when average houses cost about £23000) would have a rent of not much more than £220 a month now.

And it’s not just the absolute cost of the rent that’s the problem; if you move you can’t take the investment you’ve made in your first home and use it to get a better property at the same or lower cost; if you stay put you can’t guarantee that your rent will even remain the same in fixed terms as inflation gradually lowers its value in real terms; and if you are renting you will never reach the day when the payments cease and the home is finally yours.

Public rental has, of course, more measures to protect tenants against the whims of their landlords and the maintenance tends to be better, but over the years public rents have risen closer to private ones and it remains the case that you will pay rent for the whole of your life. A prudent housebuyer might be clear of their mortgage by the time they are fifty. A tenant may only receive help with their rent when they reach retirement – by which time even a discounted rent will be significantly higher than the mortgage on the same property. Clearly, if we are in an ageing nation (and I have some doubts about this) then it will be cheaper to keep our pensioners out of poverty if they have, themselves, paid for the roof over their heads. It will also be easier if they need long term care and can be cared for in the home to adapt the property to their needs – something that would be a legal minefield in a private rental.

When it comes to passing property on, I don’t think this should be actively discouraged, but I do think there is an opportunity here for the State to make life better for pensioners and reduce the pressure on housing whilst leaving the decision in the hands of the homeowner. Equity release – the process where a company pays a homeowner an income in order to receive their home when they die – is something that already exists in the private sector, but take-up is low – largely because pensioners fear they will die having received only a small fraction of the value of their home. If the State were to regulate the sector or at least clarify legislation such that agreements both guarantee the homeowner residency even after they have received the value of their home and render any value remaining at death a part of the estate this would allow the elderly a second income that would greatly benefit their later years, rather than having them gift the property to their children at an age when they should be at the peak of their earning capacity. In fact, if the State were to offer equity release schemes itself then these could be an easy route to replenishing the stock of social housing. Consider, if the State enters into an equity release agreement at the age of 65 and the homeowner lives to the age of 90, the State could – even on generous terms – receive the house at its value ten years before they receive it. With even moderate inflation of 3%, that could be 25% cheaper than an equivalent house at the time – a larger gain than even inheritance tax would return.

A few years back Vince Cable, the so-called sage of Twickenham, announced that we were sitting on a bubble of private debt, mostly – as I demonstrated at the time – consisting of mortgages. He was wrong, because even with the credit crunch and in spite of Gordon Brown’s limited assistance, home repossessions didn’t skyrocket and bankruptcies remained low. Home ownership is one of the unique features of the British economy, both a protection against the expenses of old age and a private investment scheme that lasts a lifetime. A government which creates the keys to unlock that investment will do much to benefit both the elderly homeowner and the State itself.

Which Lib Dems lost the election? You’ll recall in my earlier article I looked at the internal divisions of the major political parties. In Labour and the Conservatives these divides are papered over in an attempt to create an united front. The Lib Dems are frequently criticised for the manner in which they espouse different policy positions in different constituencies (something that led Nick Clegg to be extremely vague and inconsistent in the debates). Traditionally, the media have viewed this Janus-like behaviour as evidence of opportunism, of a party saying whatever they need to in order to secure power. In the negotiations for coalition this is also held up as prime cause.

There is, however, another explanation. A deeply divided party without a firm party line may face in a different direction from seat to seat because the candidates themselves have different leanings. Newspapers analysing the electoral arithmetic over the last few days have claimed that Lib Dem candidates predominately consider themselves to be left-wing or left of centre. But are they really? Over the last decade or so, the media have been redefining the terms left and right wing. A distinction which once defined attitudes about the size of the state and its degree of intrusion into our lives has been distorted to define attitudes toward race and international relations. So, the BNP who are xenophobic but believe in the state dictating to people, are regarded as right-wing, rather than – as the official definition decrees – left-wing. UKIP, who aren’t racist, but are no less isolationist, are right-wing because they believe in a small state and individualism, but the media bundle them together in an attempt to embed the idea that right-wing is the equivalent of Star Wars’ evil empire and thus tarnish the Conservatives who equally believe in a small state but who are far less isolationist than either UKIP or the BNP. Given the connotations of associating their views with those of the BNP, any Lib Dem candidate asked to classify themselves on a left-right axis is likely to consider themselves as leaning left. If, however, you discerned their position by asking policy questions, the divide would likely be very different.

Why does this matter? Well, it matters if we ever do move to a more proportional system. One of the characteristics of societies with proportional governments is that, rather than having large, inwardly divided parties, they tend to have coalitions of smaller parties with individually distinct positions. Under first-past-the-post, parties band together because they need enough candidates to secure a majority; if parliament is a plurality, this united front can muddy the message and become a positive hindrance.

If we split each party along its fault lines and ran the election again, therefore, the results would not necessarily turn out as they have now. It depends heavily not only on the views of the Lib Dem MPs who won their seats but on those who were rejected. If the policies which failed to secure a Lib Dem vote on the doorstep were those of the left, then the right-leaning Liberal party would garner more votes; if the policies of the right were the turn off, the more SDP-oriented wing of the party would be in the ascendant. The result could bolster either Labour or the Tories (or, indeed, a centre-left New Labour splinter group).

There are those who promote PR on the self-interested basis that many societies with such a system have left-leaning governments, but it doesn’t follow that we would see the same here. Different countries have different political centres of gravity: Sweden’s is to our left, America’s very much to our right. It’s possible that in the first election run under PR there could be a spurious result that favours one faction over another, but as the people got used to the system they would learn how to use it to return the government they actually wanted. And when, instead of a party attempting to face left and right in different seats there are two parties presenting different choices, the electorate may not decide that left is the direction they wish to go.

With a hung parliament, it appears that electoral reform has become almost inevitable. Of course, in a democratic country, the system of government should always be kept under  review, but is a wholesale rewrite of our electoral system a way to deliver the elixir of fairness or simply the desire of a party which sees no other way to get its hands on power?

It was, of course, a classic bait and switch. When the expenses scandal broke it was equally scandalous the way the Lib Dems leapt into the breach with the proposition that the only reason MPs were helping themselves to our money was because of the way we voted for them. Labour too, saw an excuse to finally remove the troublesome House of Lords and replace it with a body which, rather than scrutinising and rejecting some of their more illiberal legislation, would rubber stamp everything sent through it. Journalists accepted the position without question, characterising Tory resistance as an attempt to cling to a status quo which served them best, conveniently overlooking the fact that – under some of the proposed changes – the Tories would have won the 2005 election. By the time we reached the election last week, it had become accepted fact that some kind of change was needed, whether recall ballots, fixed-term parliaments or fully-fledged rewrites of the voting system itself.

Some of these changes are sane enough: the recall ballot as a mechanism for ejecting an MP who fails to serve his community would have done much to quell the furore over the expenses scandal. There are questions about implementation – should they be allowed to appeal; if they are thrown out, should they be replaced by a member of the same party or force a by-election; should they be allowed to stand again at the next general election; should they affect their pension provisions? – but the premise itself is sound. Others are less clear: a fixed term parliament would not only prevent an unpopular government from choosing the best time for the election, it could also encumber us with a failed party or coalition who couldn’t quit even if they wanted to. Perhaps a better solution here would be to retain the existing system and allow a ‘tipping point,’ where a series of recall ballots of sufficient magnitude can trigger an election across the country. And measures either to restrict the powers of prime ministers or to trigger elections when they change seem eminently sensible.

The electoral system as a whole, however, is much more complicated. The Lib Dems clearly want change for their own benefit, which is why they stress the idea that the current system is unrepresentative. But would a pure PR system like in Israel, where the smallest parties can trade votes to get through policies – policies which clearly do not command the vote of most of the population – really be more representative? What place would there be for independent candidates? Surely, if we had the same number of MPs, except returned by proportion of votes, the only way an independent could get in would be the equivalent of getting 100% of the vote in an existing constituency! And even if it was, say, a celebrity who could command enough airtime to get those votes across the country, what would happen if they got enough votes to return two MPs? Would they have to clone themselves?

Even for the major parties, pure PR – or (STV) Single Transferrable Vote – is no better. Under STV, MPs are no longer chosen by a specific constituency. Instead, they are taken from a list chosen by the party. This means that government becomes more powerful and less accountable: more powerful because any MP who wishes to stay in power has to please those who choose the list, less accountable because it is impossible for the people to vote out a particular MP with whom they have a problem. In fact, the recall mechanism cannot work with STV, because an MP would not have a constituency to recall them.

The system being touted at the moment is called Alternative Vote or AV. Under AV, people still vote for candidates in their constituency, but they express a first and a second preference. If no candidate gets 50% of the first preference votes, the last candidate is dropped and their votes are redistributed according to the ratio of the second preferences. This is then repeated until someone has 50% of the vote. The trouble, of course, is that if the parties are genuinely distinct from each other then none of us should have a second preference. If we consider the deficit the most important thing and want to vote Conservative because we agree with their stance then, if neither of the other parties share that view, by definition we can’t have a second preference. By contrast, those voting Lib Dem or Labour will be able to choose a second preference, meaning that the system would almost guarantee a Labour or Lib Dem government. Democratic it ain’t.

So, is there no way to improve matters? David Cameron has talked about ensuring constituencies have equal size, which would definitely be more democratic, but is that as far as our reforms can go? It strikes me as odd that, given all the other policies we seem to have stolen from Sweden (tax credits, academies) we’ve never actually looked at their voting system.

Sweden has, like us, a system based on constituencies.  Unlike us, however, they have far fewer of them – 36 constituencies in total. Each constituency, however, returns more than one MP. The way it works is basically like this: each party can stand as many candidates as they like in a single constituency. The voters can then choose preferences for both party and candidate. The votes are divided by party and then by candidate, meaning that if a seat returned ten candidates and had votes of 38%, 29%, 28% for the major parties there would be four, three and three returned with the most popular from each party being returned in each seat. It’s simple, somewhat more proportionate and it retains the constituency link and the prospect of a recall ballot. It also has another benefit in that it does away with the drivel about candidate selection. If a party can stand as many candidates as they like then they don’t need all women shortlists or carefully placed ethnic candidates: they can allow all those they feel appropriate to stand under their banner and let the constituents decide whether they are better represented by one person or another. This could still return fewer women or minorities, but that would be the choice of the voters and it’s hardly democratic to foist an unpopular candidate on people just because you feel it ticks one or another equality box.

There are other elements to the Swedish system: limits to reject extreme candidates with small proportions of either the national or constituency vote; top up candidates to make up for rounding errors across the seats, but there’s no reason we would have to take the system exactly as they have it. As with the other policies we’ve pinched, the basic idea can be tailored to our needs.

Centuries ago, the UK led the world in creating institutions of government. Over the years other countries have made their own way. Some have followed us, others have trodden their own paths. It would be arrogant for us to assume that none of them could have come up with improvements on our achievements. It would, however, be foolish to allow ourselves to be dragged into a system which has been chosen because of the way it favours a particular party.

There was a time, perhaps on Wednesday night or Thursday morning, when I could have believed it was nearly over. When I could hope that, by time I went to bed on Friday morning there would be a clear result and a government ready to take office. But no, just for once the exit polls were entirely correct and when I turned in at 6am after a political marathon I felt, not like a man who has seen the winning tape, but one who has woken, Groundhog Day like, to find himself back at the start.

And the greatest irony is that Nick Clegg, after spectacularly failing to capitalize on his perceived success in the debates – indeed, actually losing seats – finds himself holding the (possibly poisoned) chalice of premiership in his gift. If he deals with the Conservatives, David Cameron will be our next Prime Minister; if he chooses to side with Gordon Brown, we will continue as if no election ever happened.

The media, as you would expect, are flooded with opinion pieces about which decision Clegg should take. Some of them attempt to reason intellectually, but many – particularly those in papers like The Guardian – are still using the same divisive drivel they were using before the election. Labour and the Lib Dems, we are told, are the only progressive parties in politics. The people have voted and it is the anti-Tory vote which has won. Honestly, if these people believe this nonsense they ought to be in some kind of home. As I blogged earlier, all three principal parties have divisions within them, the idea that Labour and the Lib Dems are somehow natural allies is spin.

And the motives for this spin are obvious. The Guardian has, over the last thirteen years, cultivated a symbiotic relationship – a sort of ‘you scratch my back and we’ll both stab the voters in theirs’ deal. The Guardian is, after all, recipient of considerable government patronage in the form of job advertisements. Or, more precisely, non-job advertisements: all those government roles from chief potato advertiser to climate change hot air generator have been advertised prominently in the Guardian’s pages. The Government will have created its non-jobs to falsify the unemployment statistics and in return for advertising revenue, the Guardian will have peddled the New Labour line on absolutely everything. You, as taxpayers have not only been paying for equality commissioners to talk complete bollocks, you’ve been paying Polly Toynbee to do the same. It’s the free-market equivalent of the propaganda sheets issued under Stalin.

It has, therefore, been the role of these tame paparazzi to spread the progressive myth. This is the myth that progressive means anything at all. Because one of the tricks deployed by New Labour right from the moment they coined their own name has been to take perfectly serviceable English words and employ them as Orwellian tools of control. Progressive means, in literal terms, something that is going forwards. If it had a political meaning, therefore, it would simply mean something that is making changes that takes society forwards. All fine and dandy until you ask the deficit-busting question ‘what is forwards in politics?’ Certain things clearly can be seen on a trajectory: extending the voting franchise, making government more transparent and accountable – these are definitely progressive given that our history from mediaeval times has been one of a gradual shift of power from the state to the individual – but which party is it that tried to exempt MPs’ expenses from FOI requests; who is it that created more and more bodies to monitor and control our every action; who put CCTV all over the country, allowed trials without juries and arrests without charge, gave more officials the ability to enter our homes without us being able to stop them? Was it the allegedly regressive Tories? No, it was so-called progressive New Labour.

And many of these statist anti-individualist measures were opposed by both Lib Dems and Tories. Both have a commitment to repeal statist legislation, to set the individual free. The repeal of illiberal law is as much a Cameronian policy as a bonfire of the quangos. Yes, there are Lib Dems who oppose the idea of working with David Cameron, but these are those on the left of the party – many of whom were Labour MPs before they split away to form the Lib Dem Alliance. Look at the Lib Dem manifesto, however, and you will see that their voice has much diminished since those days. The manifesto, despite a few differences, resembles more closely that of the Conservatives than that of Labour. Yes, they claimed it was irresponsible for the Tories to cut £6Bn out of the public sector now, but so did Labour and they’ve just committed us to giving £8Bn to a contingency fund in case Greece defaults on its loans. Yes, they argued against an absolute cap on immigration, but as I’ve demonstrated myself, their own unworkable regional measures unravel to justify just that policy.

In the end, it is for Nick Clegg and his party to decide what serves the best interests of the country. He will, not unnaturally, colour his views also with what will service his party interests. But what he cannot do is to allow the twisted ravings of a newspaper desperate to keep hold of government patronage to influence his decision. Because, whether it could be construed as progressive or not, allowing the media to decide who runs the country is not a path politicians or people will wish to follow.

There’s an awful lot about tactical voting in the media today: Labour telling people to vote Labour (or Lib Dem) to guarantee the Tory doesn’t get in; the Lib Dems saying people should vote Lib Dem to keep the Tories out; the Tories saying that people should vote Tory to get the Tory in… it goes on. Most of it is bound up in the myth of the ‘anti-Tory vote’ – an idea continually peddled in newspapers like The Guardian and gleefully lapped up by Labour.

The truth is that if there is an anti-Tory vote it is mostly amongst people who have already been fooled by Labour propaganda. Labour have, for the last thirteen years, been conducting an ongoing smear campaign, an attempt to characterise the previous Conservative governments as an evil as bad as Nazi Germany, not because they genuinely believe it – after all, they wouldn’t have stolen Conservative policies to get into office in 1997 if they’d thought them evil – but because they believe that making the Conservatives unelectable will, by extension, make them the only possible rulers in a one-party state. In 2007, when the Conservative vote was at a low ebb, it was a gleeful Labour Party who proclaimed the end of the Tories. David Cameron’s speech without notes killed that idea, and forced Gordon Brown to cancel the election he’d hoped would increase his majority and extend his term in office. Now, again, it is Labour who are peddling the idea of a ‘progressive alliance’ against the Tories and, again, it’s based not so much on ideological belief, but electoral calculus.

Why can I be sure that this ideological schism doesn’t exist? Well, the truth is that any major party tends to be divided inwardly, and some of these inward divisions are larger than those between the parties. The Blairite right of Labour – the ascendancy that garnered victory in 1997 – are the Labourites whose policies most resemble those of the Conservatives, with a free-market ideology, belief in private involvement in public services, light-touch regulation of finance and so on and so forth. Had Brown not been Blair’s chancellor, they would undoubtedly have coupled the above with a lower tax regime as well. It is the left of Labour that believes in the unalloyed power of the State, the duty to engineer society by wealth redistribution and the ‘mother knows best’ attitude that has come to be called the nanny state.

The Liberals, too, have their divides. Social Liberals bear a strong resemblance to the left of Labour, whilst Free-market Liberals more closely resemble the right of Labour and the Conservatives. The Conservatives don’t have a left-right divide in this way, but they do divide on specific policy issues, most notably on Europe – although the party as a whole has become more Eurosceptic since 1997.

Given that the people consistently voted for Blair’s right-leaning policies in 1997, 2001 and 2005 and it is only under Brown that the party’s prospects have become so dim, it would suggest far from an anti-Tory vote in the country, there is an actively pro-Tory vote and Labour fears that, if the Tories garner that vote, they will win the election. Labour’s landslide in 1997 was not a reaction against policies, but against a party, and now that the pendulum has swung the other way, Labour fear that they will similarly be driven from office and into the wilderness. To rub salt into the wound, this time there is, at a casual glance, a chance they could become the third party, as the Liberals did in the 1920’s.

Only, of course, it won’t work that way. The Electoral Commission has seen to it that boundaries are drawn in such a way that there is a chance – if only a slim one – that Labour could lose the popular vote and still win the most seats. Even if the Lib Dems overtake them in the popular vote, they are still likely to come third with only about half as many seats as Labour. If Labour can take votes from the Lib Dems in Lab/Con marginals, they may be able to shore up their vote enough to come first and the easiest way to achieve this is to convince Lib Dem voters that voting Labour will somehow be maximising the anti-Tory vote and ensuring the progressive agenda.

It’s a similar trick in Lib-Dem/Con marginals. Here, votes against the Conservatives are what counts. The Lib Dems will not, in Labour’s view, have any chance of getting enough seats to come first, so depressing Conservative seats increases the chances of coming first for Labour.

And if it works and Labour comes first? Talk about electoral reform is, of course, the carrot. Here’s a poorly guarded secret: it’s a lie. Anyone who honestly thinks that Gordon Brown, holding half the seats with a third of the vote is going to enact a policy that would require him to get 50% of the vote to keep the same degree of power is either mad or deluded. He knows that coalition means less power for him, that other European leaders would kill to have as much authority as a British Prime Minister. If you vote Labour in the hope that it gives Nick Clegg ascendancy and sweeps aside the old politics, then you’re going to be very disappointed.

Assuming, of course, that it’s not Labour who are disappointed. Because whatever the Labour spin machine have done to demonise the Tories, they have done almost as much, if not more, to tarnish their own brand. Axing the 10% tax rate, eroding civil liberties, starting illegal wars, branding people with genuine concerns about immigration as bigots, all of these contribute to an anti-Labour vote. We don’t know how strong it is, but Labour’s continued poor showing in the polls suggests there are quite a few people out there who hate Brown as much as they’ve been told to hate Thatcher. And Thatcher’s not running this time.

So, if people hear Labour politicians telling them to vote Lib Dem to ‘keep the Tory out’, whilst the Tories continue their message about voting Clegg and getting Brown, the penny might actually drop. People who are disenchanted with the tyrant Brown and who wish him brought down might consider that a different type of tactical voting is in order – one where they vote Lib Dem in Lib/Lab margins and Conservative in the Lab/Con ones. One which might, despite the Electoral Commission’s gerrymandering, deliver a real change in our politics, the first shift in the tectonic plates in ninety years. Obviously, I can’t guarantee that a Lib-Dem official opposition will be quite as wedded to the idea of electoral reform as they claim at present, but having both a new government and an opposition who can’t simply be dismissed as the cause of all the problems would be a much stronger combination than a squabbling coalition or a discredited wreck of a party clinging to the vestiges of power for a little longer. And, looking a little further down the track, it’ll be worth keeping an eye on those internal party divides. Because those might just be the first signs of a much more significant realignment of politics to come.

If there’s one word the parties have attempted to stamp through this election like Brighton Rock it’s ‘fair.’ Taxes have to be fair, cuts have to be fair, even the voting system has to be fair. And it’s this kind of language that feeds disengagement – not because people don’t want fairness, but because it’s what the Americans call ‘apple pie politics’, where a politician uses a touchstone that nobody in their right mind would argue against – the importance of family, a stable economy – and then by overusing the word tries to imply the opposition is opposed to it. This is contrast to the other overused word, ‘change’ which only resonates when there is a feeling that we’re going to Hell in a hand-basket and people might quite like to get out before the wicker catches fire.

The trouble with fair is that everybody has their own view of what it means. So you hear public sector unions peddling the line that it’s unfair that the failure of a few bankers should cost them their jobs. It’s a stupid argument, partially because we already had a record deficit before the credit crunch, but mostly because a large chunk of the public sector spend before the crunch was coming from those same bankers. Did we hear them complain that it was unfair they were being taxed to pay for whinging bureaucrats? Of course not. That’s not to say they didn’t complain, of course, but for some reason the papers are more likely to report what unions say than banks…

And you hear various pressure groups saying that cuts in their favoured areas would be unfair to someone. Schools, the police, theatres, everybody, it seems, except the Egg Marketing Board (who presumably only get reported in one of those weird papers on Have I Got News For You) claim that their slice of the pie is critical for fairness. All of which makes it more than likely that any government will put some taxes up. It’d be nice to think that we could do the same as Canada, rebalance our public and private sectors with a real war on waste, but back in the real world it seems a dim hope.

And taxes are even more contentious. The Lib Dems have majored on the idea that the tax system is already unfair; that the poor pay a larger proportion of their income to the taxman than the rich. Even after the BBC systematically demolished this argument, they still stick to the line. I won’t repeat the arguments for that here, suffice to say that the Lib Dems don’t include the amount the poor claim in tax credits when they are doing their sums.

No, the myth being peddled without argument now is VAT. Labour insist the Tories will raise it: not because they’ve seen any evidence, but because they’ve done it before. None of the parties has ruled it in our out, largely because they can’t. One of Labour’s most insidious acts under Gordon Brown has been to suppress any form of public spending review. Brown has been waiting from day one to call an election the moment he thought he could win it, and publishing figures that demonstrated how he has systematically wasted the public money (especially since he couldn’t blame it on a predecessor for whom he served as chancellor) would have been to hand serious electoral points to the opposition – which is why David Cameron has had to rely on anecdotal evidence for waste in his TV debates.

But is VAT actually unfair? When John Major first taxed fuel payments, the furore suggested that pensioners would be dying in their homes. Labour, rather than repeal the measure, responded with their highly politicised winter fuel payments scheme, a typical measure to garner headlines whilst only helping the minority. But if VAT went up now, it is likely that only those goods that are fully VAT rated would qualify for the rise. Fuel would not be affected. Would the poor really lose out?

Let’s take an illustrative example. How would an average low-earner be likely to spend their money. Let’s put them on £15,000 – lower than average, but not unusual for someone in a menial public sector job or working a forty hour week in retail. After tax, £15,000 is £1022.85 a month. Average rent on a small flat will range between £300 and £400. This isn’t VAT rated. Council tax will add at least another £100 to that, and fuel bills (rated at the lower level) could be another £50. Food, for the most part not VAT rated would take another £150 – £200, assuming the person doesn’t live on ready meals. Taking just those elements, that’s already £600 – £750 of earnings. Add the usual home insurances, life insurances and pension payments, and our average low-earner could be left with only £100-£200 of disposable income, which is then their entire exposure to normal rate VAT. If they’re running a car inside that bracket, then most of their VAT will be on petrol and they will have been impacted as much by the Government’s fuel duty escalator as by any VAT rise.

Because the truth is that neither the poor, nor the very rich are particularly exposed to VAT. VAT falls most heavily on consumer goods and luxuries. The very rich buy these, but without using much of their disposable income; the very poor buy them only when they can, and tend to buy cheaper versions. It is the middle-earners, the people who can afford a new wardrobe every year or a new three piece suite when it takes their fancy who will suffer the most if VAT goes up.

That’s not an argument to say it should, of course. Because the biggest myth of all in this election is one I’ve alluded to already – that public sector jobs should be sacrosanct and that the workers should consider it unfair that their jobs be at risk in the crunch. Look at those figures for our low earner again and you’ll see that he’s losing £2,700 a year in direct taxation. If that tax were really all going to schools, hospitals and police, then that would be fair enough.  The truth, however, is that a great many public sector roles are either surplus bureaucracy or pointless quangoes. It can hardly be considered fair that the poor are expected to cover the cost of either of those.