The Liberal Party notes with real concern the recent Spring Statement announced by the Chancellor.
The return to austerity via-a-vis public sector cuts (most notably cuts to welfare) the party deems as being completely and wholly unnecessary and thus a political choice borne out of incompetence.
The Chancellor announced on Wednesday, cuts to Welfare to the tune of £5 billion in order to bring down the Welfare budget and thus cut those people claiming benefits. However, the chancellor fails to realise that by shaving £5 billion off the welfare budget the chancellor is directly impacting those already on the margins of society.
Furthermore, the party notes that the prior budget in October and indeed the chancellors’ fiscal rules has inevitably lead to her having to return to austerity and thus cut public expenditure above and beyond what is necessary. She has essentially boxed herself in through own making!
The Liberal Party would have done a number of things differently in order to not only grow the economy but also reduce the number of those on welfare and thus increase the workforce.
Firstly, it would have reformed Welfare and indeed the tax system in order to increase the number of people in the workforce by simplifying the benefits system (only having three lots of welfare that people can claim). Moreover, it would have also increased the Personal Tax Threshold to at least £20K in order to ensure that work always pays.
Secondly, it would have reformed the tax system by simplifying it in order to ensure both transparency and fairness. A notable example would have been to get rid of the National Insurance hike on employers by scrapping National Insurance all together and thus merging it with Income Tax.
Thirdly, the party would have both levied as well as reformed certain taxes on those in society with the broadest shoulder who could have offered to pay so: Council Tax/Business Rates would have been replaced with a Land Value Tax, the Digital Services Tax would have been increased to 10%, the £4 billion bankers bonus tax would have been reinstated and finally, Income Tax and Capital Gains/Dividend Tax would have been equalised at the same rate.
Overall, the party notes that the statement was very disappointing with a real lack of long-term vision and indeed competency.
Kayed Al-Haddad
(The Liberal Party Economics spokesperson)