Monday, 26 October 2015

We need to talk about tax credits

Today the House of Lords’ will debate the Government’s reforms to tax credits, and there is a chance the Lords’ will try to block these. Not only would that be wrong constitutionally, it would also be wrong in principle. Tax credits need reforming. Changes need to be made so that hardworking people can have confidence that every penny of their pay cheque is theirs.

The tax credit system is broken. I first became aware of tax credits as a child watching my Mum, a single parent, fret over an overpayment letter from the tax man. A lot has been written about how government’s changes to tax credits could affect people. Very little has been written about how doing nothing could affect them though. Anyone who has had the experience of being told they got too much tax credits last year, and so they need to pay money back, knows tax credits are not perfect. Nobody on tax credits can ever be completely confident that their pay cheque is accurate. There is always the chance that money you have been given, money you might already have spent, will be demanded back from you.

My experiences have made me believe that instead of taxing people, and giving them a little of their money back as tax credits, the best thing to do would be to tax less in the first place. This would free the British people of a system so open to the possibility of error. Your pay would be your pay, and there would be no more letters through the door saying your tax credits were miscalculated. People could feel secure about what they actually had to spend, and budget secure that no money would be later clawed back from them.

This forms part of the Government’s long-term economic plan. We are moving from high taxes and high welfare, to low taxes and low welfare. The Government is not only making changes to tax credits. It has also cut income tax every year for the past five years. 27 million people have already had their income taxes come down, and even better the income tax reductions will continue. In a few years time none of us will be paying any tax on the first £12,500 we earn.[1] Under the Government’s new system, not only we will have greater security about our pay, the tax man will be taking less of it in the first place.

The fear people feel about the changes we are making is understandable. Some elements or right wing twitter reacted unfortunately after it emerged that Michelle Dorrell, who raised the issue of tax credits on Question Time recently, may not actually be affected by the changes[2]. However, I think people need to understand the fear of those who base their family budgets on tax credits: The change represents a new situation that you have not experienced, so you do not know if you can manage. You are too busy trying to put food on the table, get the kids to school and get to work on time, to grapple with numbers being thrown by so-and-so think tank against such and such analyst. Until the new situation is in place the prospect of change will be unnerving, because you know more or less how the current system works but not how the new one will. As centre-right people active on social media our job is to explain not to attack.

The British people are exchanging a lifetime of uncertainty for one spring’s. Having lived in a single parent family that used tax credits to get by, I recognise how the prospect of changes to them will feel. The whole thing is not made any easier by negative claims about how the changes might affect people, which ignore how Conservatives’ reducing income tax, creating a National Living Wage and offering 30 hours free child will all help. Still, what you need to keep in mind is that once this is done it is done. You won’t have some good years in which the tax man doesn’t try to claw back money from you, and some bad years in which unexpectedly he does. You won’t need to worry about the ‘what if’ of it happening. That will all be gone. Instead, you will know from your pay slip exactly how much money you have to plan for the future. Plus, you will be able to make those plans knowing that under the Conservatives’ income tax will continue to come down every year.

[1] David Cameron, Speech to Conservative Party Conference, 1 October 2014, link
[2] Telegraph, 16 October 2015, link

Tuesday, 13 October 2015

Letter to students

Its been too long since I blogged. I apologise for that. I am grateful to those of you who have done me the honour of visiting this blog. In future I will try to make sure it does not go through months of inactivity. I have yet to decide what topic I wish to tackle next. While I work that out I hope the following letter, which a teacher friend of mine asked me to write to her students, will suffice. It is not strictly political. It should, in some small way, add a little depth to where I get my politics though:


Your teacher has asked me to tell you my story, as she believes it will encourage you to write your own stories in the future.

My early life, I assume, was quite similar to many of yours. I grew up a third generation Jamaican immigrant in South London, under the care of a single Mother, with plenty of help from my Grandma. As a child I just tried to work hard and make my family proud. Comparing our childhoods I doubt you will find much different.

I was lucky enough to graduate from Oxford University. Before I went to university nobody in my family had done so, so I decided I would. I wanted my Mum and Gran to feel it was worth struggling to raise me. Studying Theology at Keble College, Oxford, gave me a chance to give a little back to them.

Life at Oxford was amazing, I highly recommend it. It was very different to what I was used to, which excited and intimidated me. I was keen not to mess up, so keen that I withdrew a bit and did not use the university as I should have. For all that, I regret nothing from my time there. I enjoyed it and I can use my missteps to guide you.

In families with a tradition of university going people get guided through the system. For those of us not from these families there is a lot to figure out. I am happy with where I have ended up. The journey there could have been simpler though. I fell into Oxford. At 14 I did not think about what I wanted to study at 18, and choose my GCSEs and A levels to get there. At Oxford I did not plan ahead, and use its networks to make my career happen. I should have. Learn from what I did not do, make getting to where you want to go easier.

After university I struggled to find a job I loved until Mark Harper MP employed me in his Parliamentary office. I am a natural Conservative. Thanks to my heritage, I value freedom more than anything. How can I not given my ancestors were slaves? Further, growing up as I did, I saw repeatedly that sometimes there is no good option, just bad, worse and even worse. This taught me that it is often necessary to make difficult decisions to get on in life. I came to see government could not solve all my problems. I learned that you cannot achieve financial security by more spending, more borrowing and more taxes. Still, it was not until a year after I left Oxford that working in politics occurred to me.

When I decided to try and get into politics I had no idea where to start. Luckily, after a hopeful application, I got interviewed by Nick Boles (now an MP too) for a role at Conservative Central Office. Nick explained to me how important it would be to intern, and get some practical experience on my CV. His advice set me on the way to where I am now.

Never underestimate how much people want to help you. When I went to work for Mark Harper I was, frankly, not ready. When I began the jobs I have had since, at the Confederation of British Industry, Conservative Central Office, and at Brevia Consulting, I was also not ready. I have learned that things that seem totally normal to me, coming from where we come from, may seem totally other to those who do not (though everything you picked up as a kid about not snitching is very useful in politics!) I have had to learn to think much harder before I act, and I would be lying if I said I am always successful doing so. Yet, again, I regret nothing.

I have met truly brilliant people in politics and public affairs willing to help me learn. Listing all their names would take too long. Plus, some may find it harder to their jobs if I mentioned their names! Yet they will always have my affection, as they have given me some of the best years of my life. In part thanks to them I am here writing this to you: Helping you to understand how to get the right experience on your CV, before you leave university, to get the job you want. Helping you to understand how different expectations can be in different environments, so you can be ready for that. Helping you to have the skills you need to build a brighter more secure future for yourself.

I hope I have managed to pass on this help to you. I hope someday you can help other people coming from where we come from in the same way. Nobody should feel that a professional career, or any kind of career, is off limits to them. Where you start out from is irrelevant. Where you end up is all that matters. Whatever you want from life is achievable.

I wish you all the best.

Myles Alexander Bailey