he UK was in a far worse state in 1945 and yet we built the Welfare State. This reactionary, right wing crew of (multi) millionaires' (23 of the 27 cabinet ministers possess fortunes of over £1m) true aim is the very dismantling of the Welfare State and the plundering of the last remaining resource their private sector backers have yet to get their hands on by privatising the huge public funds that we all put into the health service.
To be effective we need grounds for opposition. An anti-cuts campaign needs to address the clearly ideologically driven assault by the Cameron/Clegg clique on the public sector as a whole (already a term of abuse) and public sector wage/pension levels and contrast it with their incredibly relaxed attitude to tax avoidance and evasion and those really responsible for this crisis - the bankers. Osborne only took £2.9bn from the banks in his budget. The Institute of Fiscal Studies has judged the CSR as regressive because £18bn has been taken from the lowest 10% and the bankers levy can be offset by gradually falling corporation tax.
As for the so-called 'gold plated public sector pensions', the bankers and their fat cat pensions cost us all money. Cameron and Clegg say that 'gold-plated public sector pensions are 'unaffordable' and 'unfair'. The Tories and their new-found LibDem pals are trying to convince us we have no choice but to 'share the pain' of the crisis in reality brought about by their banker friends. The real 'gold-plated' pensions belong to company bosses. Retirement pension lump sums won't be protected from tax.
The Tories and their LibDem pals aim to convince us that we have no choice but to share the pain. According to the TUC, the largest director's pension at oil giant BP is a staggering £21.5 million. The vast majority of company directors get to retire at 60 or earlier – with 'golden goodbyes' that for some are worth millions of pounds tax free! Former RBS chief executive Fred Goodwin quit the bank when it collapsed, sacking thousands of workers. He walked away with not only a £345,000 a year pension, but also a £2.8 million lump sum – on which RBS paid the tax! To add insult to injury, the super-rich then get generous tax relief on their pensions. The richest one percent in society get 60 percent of all pension tax relief – the equivalent of £10 billion a year. For every pound we spend as taxpayers on public sector pensions, we pay £2.50 subsidising the pensions of this tiny minority. Why should we suffer cuts so that the rich who caused the financial crisis we're in can continue to be 'profitable' and generate wealth at our expense? Fat cat pensions in the public sector are a myth says the TUC. Unlike in Britain's boardrooms top public servants are all in the same pension scheme as other staff, the majority of public sector pensioners receive a modest £5k a year on average.
Moreover, WE can't get sweetener deals from the Inland Revenue: we're not all in it together. The Financial Times (19/08/10) and Private Eye (#1270) report that Vodafone International secured a dispensation (in perpetuity!) from Her Majesties Revenue and Customs that we would be most unlikely to obtain costing us all £6bn in avoided tax. Coincidentally, this was exactly the same figure as public spending cuts that George Osborne announced in his May budget.
Even Danny Alexander (not exactly 100% sure of himself when paying his property taxes) estimates evasion annually at £42m (Metro 20/09/10). Moreover, whereas benefit fraudsters (or, as is more often the case, erroneous overpayments by the DWP) represent 0.3% of GDP evasion avoidance adds up to 3.0%. The resources put into tracking down benefit fraudsters proportionate to the fraud are very generous. Whilst HMRC has seen its budget to catch evaders fall from £3.6bn 2006-7 to £1.9bn today (Private Eye #1270). The promise by Alexander to put £199m into HMRC's 'assault on evasion' is, frankly, unlikely to deliver the necessary missing revenue.
Meanwhile their rich pals have become richer: we are NOT in this together. In just a year (July 2009-10), the collective wealth of the UK's 1,000 richest people has staged a remarkable recovery (according to the Sunday Times Rich List April 2010). Their combined fortunes have risen by more than £77bn since 2009 to £333.5bn, the biggest annual rise in the list's 22-year history! The number of billionaires rose by 10 from last year to 53! Retail tycoon and Clegg-Cameron's 'Cuts Czar' Sir Philip Green and his wife increased their wealth from £3,830m to £4,105m but their ranking fell from sixth place in 2009 to ninth (ouch!). Dividends from Green's businesses continue to be paid to trusts controlled by his Monaco-resident wife Tina, undisturbed by the taxman! Osborne himself was in receipt of money gifted from his father in a tax avoidance scheme, which probably saved him thousands.
We really need to target those who are enjoying the cuts bonanza, and focus our fire on the real culprits. Labour's Exchequer poured billions into bolstering the banks, some £500bn with zero regulatory concessions from these economic hoodlums in return, shelling out billions more for eventually abandoned, or 'habitually' overrunning, defence procurement programmes (which Labour projected would cost £38 billion this year alone). This amply confirms, along with the useless post-colonial forays into Afghanistan (cost along with Iraq since 2001, £9.5 billion), Cameron/Clegg's continuing delusional and extravagant view of our world role, despite their defence cuts. Shares in defence companies actually rose on hearing the statement according to the Evening Standard, as these Tory backers realised the number of people who were being cut.
We need to argue that efficient and well funded taxation NOT cuts is what is needed. Moreover, that over and above this profligacy, is the systemic injustice represented by this total inability to make tax evaders pay up. Comprising of tax avoidance, using legal loopholes and tax evasion, this tax gap could stand at £120 billion a year, according to the Tax Justice Network. HMRC concurs with Danny Alexander's £40 billion as the figure being avoided and evaded but, in addition, admits to another £28 billion that has already been identified as owed yet still unpaid! Compared to those parliamentary duck pond shenanigans this untaxed profiteering at the expense of the public purse is emerging as the true scandal.
Despite privatisation, workers in the public sector continue to provide the foundation for our society – our health, social and welfare needs. Without properly funded public services, and workers with decent wages and conditions to run them, the quality of care and services we rely on will plummet, as will all of our standards of living. This is what we have to fight. It is a pernicious 'Lie' that it is all our fault, the fault of us the ordinary people, whether we work in the private or public sector. Clegg and Cameron's cuts are not necessary if they go after those that got us in this mess and continue to profit from it. We know they will not do this unless we stand up and force them to!
As George Monbiot points out (The Guardian, Oct 19th) this Comprehensive Spending Review is Britain's bespoke 'shock doctrine', one tailor made in Saville Row. Both he and Seamus Milne (The Guardian, Oct 21st) are stating the obvious fact that their crisis is being paid for by 750,000 jobs (according to the Chartered Institute of Personnel Development estimate) and mass misery. The strategy is clearly designed to reshape society for their unreconstructed neo-liberal project.
Like Michelangelo, Nick Clegg's Orange Book gang provide the fig leaf for the Tories and their real goal ever since 1945 of rolling back the Welfare State. It might sound 'logical' to cut, but we need to really analyse whose 'logic' is being employed and whose 'interest' is being served by executing this madness. It is certainly not the 'Public's'.