Tuesday, 20 November 2012

Osborne mulls pension raid..

Those of us who have been scratching heads trying to work out how all the excitement about new council tax bands could be reconciled with what George Osborne and Dave have said about more property taxes have what looks like an answer this morning: according to the FT  (£), the Chancellor is going to whack pension contributions for higher earners, apparently by restricting further the amount that can be salted away tax free. The first £50,000 of pension contributions can currently be made from pre-tax income, with tax calculated on the remainder. That allowance could now be reduced, increasing income tax bills if contributions remain unchanged. This makes more sense, in that the Tories are heading for a disaster if they do anything that reverses their recent pledges to keep property snoopers out of Tory homes in the south east. To judge by how much this new scheme raises though, expect more complaints about pointless political gestures to satisfy the Lib Dems when what should be targeted is spending. 
There is also the accusation that Mr Osborne is taking a leaf from Gordon Brown's book of recipes for economic success, as removing tax credits on dividends in pension schemes by Mr Brown is estimated to have cost the wider economy over £100bn in the meantime. This isn't a first for George, he h as already reduced the tax free pension contribution threshold from £255,000 to £50,000 per annum, and a further cut to £30,000 could raise another £1.8bn. With new council tax bands being blocked by the Prime Minister and further stamp duty increases thought to yield next to no income, a 1pc increase on the 5pc higher rate would raise only £70m, his options for hitting the rich are narrowing sharply ahead of the November 28th deadline for the submission of his Autumn Statement to the OBR. It looks like the Chancellor has found a way of balancing the Coalition arithmetic, but at what economic and electoral cost?
He didn't have much wriggle room before, and he certainly has none now. Dave admonished the EU for "picking pockets" in his CBI speech yesterday, the Mail reports, a move which will make bringing home anything bar a freeze from this week's two-day budget summit nigh on impossible. The Prime Minister knows he is on a hiding to nothing at the negotiating table, and with diplomatic niceties apparently being cast aside in the budget dispute, it is hard not to agree with Vince Cable, who yesterday affirmed his belief that an in/out poll is inevitable in thefuture. Of course, while you can't fool all of the people all of the time,there's always Ken Clarke, who confidently signalled that Britain's contribution to the EU would increase above inflation, the Sun reports. With UKIP on the rise, such a move would be damaging. This morning's Guardian reports that an ICM poll has found UKIP on 7pc and mining a rich seam - 68pc of Tory voters would choose "out" in an in/outreferendum . Dave the statesman will need to be tempered by Dave the tactician in his negotiating stance. As I write in my Telegraph column, what the Prime Minister really believes, though, is still opaque:
"It is fashionable to talk about sleepwalking towards the exit – Mr Miliband complained about it yesterday, without a hint of irony – but in fact Mr Cameron has been strolling towards it, with a degree of insouciance that is profoundly worrying. Not because the prospect of leaving the EU is to be feared – on the contrary, it may be as wonderful as those advocating it suggest – but because we know nothing about what it entails in practice. Mr Cameron is allowing a conversation to take place in which the participants are motivated by belief, not facts."
A total of 51 MPs have been allowed to censor details of their landlords by Ipsa on security grounds, the Telegraph reports. What the Times (£) terms the parliamentary "money go-round" also saw several MPs renting from other politicians and political donors, while to the delight of theSun , Peter Luff's landlord turned out to be Chelsea's Frank Lampard. A separate Ipsa report also found that many MPs found their housing allowance of £1,450 a month insufficient and objected to having to use night buses, the Telegraph adds.
Despite the public show of solidarity on the green benches, Ed Davey has been infuriated by John Hayes' casual disregard for the green policies of the Coalition. Mr Davey wrote to the Prime Minister following Mr Hayes' declaration that "enough is enough" when it comes to onshore wind farms, asking for his junior minister to be either muzzled or moved. Dave refused, according to the FT (£), and his aides are also briefing that he will get his way over his random announcement  long-term plan of forcing energy firms always to offer their lowest tariffs. A master tactician at work.
Despite having argued against the appointment of Lynton Crosby as Dave's new election guru, Lord Ashcroft has reached out to him this morning with a campaign memo published on ConservativeHome. Relying on Ed Miliband being the party's biggest election draw isn't a strategy in itself, he warns: "while many people will vote Conservative because of Cameron, others will vote Labour despite Miliband. Aggressively pointing out his flaws, which they can see anyway, will not change their vote – but, as in 2010, it will represent a missed opportunity to show why they should support us instead."
Highclere Castle, where ITV's Downton Abbey is shot, was the venue for a Cameron fundraiser earlier this month, Richard Kay reports in theMail. Organised jointly by hedge-fund boss Lord Fink and Lord Feldman, the evening saw around 80 prominent party supporters receive a vote of thanks from the Prime Minister for their continued support of the party. After his run-in with stag's liver, you would have though Dave would steer clear of aristocratic dining...
Dave humbly compared his austerity drive to the efforts of Whitehall in the Second World War, provoking inevitable comparisons with Winston Churchill, not least from Cristina Odone on Telegraph Blogs. Now we learn that Ed Miliband is, in fact, Margaret Thatcher. In a Radio 4 documentary last night, Ed compared the present situation to that at the end of the 1970's and praised a fellow conviction politician, according to the Mail. Sir Malcolm Rifkind was not buying it:
"I recall [Mrs Thatcher] despised politicians who try to be all things to all people. Mr Miliband appears to fall into that mould.  He has as much claim to the mantle of Margaret Thatcher as Silvio Berlusconi had to that of Julius Caesar."
Iain Stewart spots a man deputising appropriately:
@iainastewart: "The current speaker in the Commons debate on a Groceries Code is a Mr Mark Spencer! :)"
In the Telegraph
Peter Stanford - Judgment day - at last
Best of the rest
Janan Ganesh in the FT (£) - Cameron is right to turn to Australian fixer
Rachel Sylvester in The Times (£) - What Britain needs is unreasonable people
Polly Toynbee in The Guardian - No amount of moralising will alleviate this harship

09:30 am: The Council of Mortgage Lenders publishes its gross mortgage lending figures for October.
11:00 am: International Development Secretary Justine Greening gives evidence to Commons International Development Committee on post-2015 aid goals. Committee Room 5, House of Commons.
12:30 pm: Foreign Secretary William Hague makes Commons statement on Syria.
05:00 pm: Energy Secretary Ed Davey gives evidence to the Commons Energy Committee on energy policy.