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:: Thursday, April 18, 2002 ::
Read my lips...
As might be expected, I agree with the budget analysis provided by the Telegraph in An unhealthy Budget. We all knew Brown was going to raise taxes, but to do it by the regressive means of a penny on NI was a surprise to me:
But it was the second part of the speech, in which the Chancellor broke Labour's pledge not to raise income tax just a year after the Prime Minister had repeated it at the last election, that attracted all the attention. Mr Brown may have tried to pretend that he was increasing National Insurance rather than tax, but no one will be fooled. By extending the increase to earnings above the existing ceiling on NI contributions, he effectively raised all rates of tax on earned income by a penny across the board. By any standards, it was a remarkably flagrant breach of electoral trust. Taken together with the extra penny on employers' NI contributions and the freeze on the tax threshold, from next year the Exchequer's take will rise by the equivalent of three pence on income tax. Compared with this, all the other revenue measures and concessions in the Budget were small beer - quite literally so in the case of the tax break for pubs that brew their own.
Of course, the hike will mean everyone getting less money for quite some time before the NHS improves, assuming that it can improve simply by throwing money at it. Which, of course, it cannot. So, as the Telegraph says,
For the Tories this all presents an obvious opportunity. But they should still tread carefully. Before they can win the argument on health, Labour still has to lose it, and the Conservatives should wait until Labour does so before firming up their own proposals. By the next election NHS spending is set to be more than £3,000 per household, a figure comparable to mixed, insurance-based systems in other countries. Mr Brown has bet the shop that by then it will provide a comparable service. He has staked his management of the entire British economy on this hope. Where's his famous prudence now?
If cancer is still a death sentence in the UK, if hospitals are still having to appeal for charity to buy PET scanners and MRI machines and if there are still people sleeping in hallways, then the next election should by rights be a shoe-in for the Tories. Let's hope Labour keeps crying wolf over the NHS.
:: Swordsman 4/18/2002 08:02:00 AM [+] ::
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