Wednesday, 3 October 2007

Tax Credits

The tax credit system isn't exciting or easy to understand, so it doesn't get a lot of newspaper coverage. But Frank Field, who spent a year "thinking the unthinkable" in 1997 and being frustrated by Harriet Harman, is a big critic of its effects.

I previously made the case for abolition, using the minimum wage instead to prevent poverty wages. Field believes an extension of the system could be the answer - and given his lifetime of study in this area, deserves to be taken seriously.

But I am sceptical. The problem with setting up a system which is complicated, creates fraud and creates injustices, is that there is a tendency to believe that extending it, giving it new powers and adding complication, will cover all those problems.. In fact you end up creating new injustices, sucking more people into the welfare system, and incurring a greater cost. Such is the story of many large-scale welfare programmes across the world.

1 comments:

David Lindsay said...

Birkenhead is one of the very few seats where anyone should bother voting at all in a General Election next month. Frank Field is a national treasure, and proof that you don't have to come from an extreme position to be an original political thinker.

He is also one of the most striking examples of just how badly the Old Labour right wing (if you want to call it that - you know what I mean) has done under New Labour, a carve up between those who cleared off to the SDP and those who were Communists, Trotskyists or fellow-travellers at that time.

Now we even have two Ministers in all but name and salary who are taking the Tory Whip, and one who is taking the Lib Dem Whip; one of the former spent Labour's battle years running the Federation of Conservative Students and being Secretary of the Race and Repatriation Committee of the Monday Club! (What are Labour candidates' leaflets in this threesome's constituencies going to say, and why?)

Meanwhile, Frank Field, who long ago resigned from the old YCs in opposition to apartheid, is writing op-ed pieces for the Telegraph and that's about it.

When the new party comes, as it surely must and certainly will, then I for one hope that Frank Field, among others one could name, does it the honour of joining it.