Friday, 7 December 2012

IFS predicts tax rises..

Good morning. It's a thin news day as Westminster draws breath after excitement of the Autumn Statement. The extended post mortem carries over into today's papers, and the coverage is less positive for the Chancellor. When it came to the disastrous Budget earlier this year, the devil was in the detail for Mr Osborne, with the fine print bringing about the Great Pasty Tax Uprising. It could be that the same is true this time around. The IFS announced yesterday that George's sums simply don't add up. Branding as "inconceivable" the scale of the cuts planned in non-protected areas, which would need to run to 30pc in real terms between 2010/11 and 2017/18, the think tank believes that tax rises will need to take their place. As the Telegraph reports, a £27bn tax increase would be needed just to keep protected areas on an even keel in real terms after the next election. Then there is the case of the 5m people theMail asserts will be higher rate tax payers by 2015, a result of fiscal drag capturing 500,000 more people than Treasury projections indicated. A tax intended to capture the extravagantly wealthy is the new normal.
The rich, as the new higher rate taxpayers have been classified, have few friends in Westminster. Senior Labour figures want to devote their efforts to attempting to prevent the 1pc cap on working age benefit rises taking effect, as does the Times (£) which runs an article of the impact on the disabled on its front page, and one on the impact of the bottom 30pcinside. Ed Miliband is mulling his options and may take the electorally unpopular position of opposing the strivers v skivers narrative Mr Osborne has crafted. That is good news for Osborne the strategist, if not Osborne the Chancellor, as is the news that Labour's "Mummy Tax" line (seen here in the Mail) has failed to fly.
Most importantly, though, there is the issue of Ed Balls' stammer. While the Mail concerns itself with the very hostile questioning George Osborne faced from Evan Davis on the Today programme yesterday, the rest of the press pack is asking itself whether the Shadow Chancellor should be treated as disabled. "Red faced Tories braying with stage laughter" upset Margaret Drabble in the Independent, whereas Quentin Letts in the Mail and Dan Hodges in the Telegraph both take the view that the excuse was symptomatic of a man who never concedes responsibility when he made a mistake.
The Chancellor, who once claimed a field for his horse at taxpayers' expense according to today's Mirror, decided yesterday that the AAA rating didn't matter that much after all. That's just as well as it won't be around for long. With a downgrade would come higher borrowing costs which would make Wednesday's path impossible to tread. The Treasury will be happy that Starbucks is to volunteer £20m in tax over the next two years, but it is Britain which needs to start paying its way, and soon.
Dave has identified a third way over press reform, the Telegraph reports. The Prime Minister is considering establishing an independent press regulator by means of a Royal Charter, the same mechanism used to found the Bank of England and the BBC. As a Royal Charter cannot be changed without government assent, the move would prevent the press from unilaterally changing the terms of their regulatory code. The move would also answer many of the objections raised by Labour, who theGuardian reports are soon to publish their own Leveson Act. As for the editors, they're ready to deal, the Mail claims. Lord Hunt and Lord Black are working on the final form of the industry reply, but with poachers and game keepers keen to avert a statutory solution, for once this should solve more problems than it creates.
Nick Clegg has been doing his best to scotch rumours that relations between the Coalition partners at a senior level had improved after the bonding experience of the Autumn Statement. The Mail reports that Mr Clegg told Ad Lib magazine that the Conservative backbenches lack compassion and that his role was to "yank them back to the centre". Oh well, at least those thoughts put him on Mr Cameron's wavelength, if nothing else.
Sir Jeremy Heywood isn't a Rasputin-esque figure thriving in the chaos of the Downing Street machine, Amelia Gentleman writes in her Guardianprofile of the great man. He is, in fact, a misunderstood colossus, propping up successive governments with his Stakhanovite work ethic and refusal to make jokes. Ringing commendations from a number of insiders praise Sir Jeremy for mastering the "art of the possible". The only dissenting voice is Paul Flynn's: "we were expecting to meet pure gold. He turned out to be just another obfuscating civil servant. There was no real thrill," he grumbles.

A little light theology from Tom Harris:

@TomHarrisMP: "I'm not sure I'm taking the correct meaning from my Bible readings, but isn't Job an obnoxious, arrogant sh*t? "

In the Telegraph
Best of the rest
Phillip Collins in The Times (£) - Labour must cut its dependency on welfare
Mary Ann Sieghart in The Independent - I used to think more cuts were the answer. But not any more
Quentin Letts in the Daily Mail - Oh, please! Don't play the victim card, Mr Balls
Today:  Deputy Prime Minister Nick Clegg to make series of Regional Growth Fund visits.
10:30 am: High Court action by one of the civil servants suspended following the West Coast rail franchise fiasco. Kate Mingay, the Department for Transport's commercial and technical services director, was one of three DfT officials suspended after the Government pulled the plug on the West Coast bidding process earlier this autumn. She is applying for an injunction prohibiting the continuation of her suspension. The Royal Courts of Justice, The Strand,