The Claim
“The Liberal Democrats have been in government for only ten months, but we have already implemented many of our manifesto policies.”
Chris Fox, Chief Executive, Liberal Democrats, March 10, 2011
Cathy Newman checks it out
The police have erected a ring of steel around Nick Clegg as he prepares to address his spring conference in Sheffield this weekend. And now his spinners are doing their best to shore him up, by issuing a dossier of Liberal Democrat triumphs since the general election. They’ve got their work cut out. Protesters furious at a series of Lib Dem U-turns since the party joined the coalition have suggested they’ll try and kidnap the Deputy Prime Minister. So has the list of achievements given him something to shout about? Over to the team.
The Analysis by Patrick Worrall
The Lib Dems have produced a list of more than 100 promises set out in their election manifesto which they say they’ve kept.
That’s an impressive number, but inevitably, some policies are more important than others.
Scrapping ID cards was a big bold move that both the Tories and Lib Dems could agree on – but refunding VAT to mountain rescue teams isn’t something that’s going to make Nick Clegg’s name live on in the annals of Parliamentary history.
FactCheck likes to cut through the waffle and concentrate on the big stuff.
When they published their manifesto in April last year, the Lib Dems set out four key pledges: “Fair taxes that put money back in your pocket. A fair chance for every child. A fair future, creating jobs by making Britain greener. A fair deal for you from politicians.”
Wrapped up in those were a serious of concrete policies: raising the income tax personal allowance to £10,000; investing £2.5 billion in schools to cut class sizes; breaking up the banks and getting them lending again; giving constituents the right to sack MPs; introducing a Freedom Bill; a fairer voting system and an elected House of Lords.
Let’s look at them one by one:
• The Lib Dems wanted the first £10,000 of everyone’s salary to be tax free, meaning 3.6 million more earners wouldn’t pay any income tax.
Instead, they got the personal allowance raised by £1,000 to £7,475, lifting 880,000 people out of tax. It is was a good downpayment, and the party is adamant that the threshold will go up every year until it reaches £10,000 by 2015.
As far as the Chancellor’s concerned though, tax cuts for motorists may have to take precedence. So we’ll have to wait for the Budget in just under a fortnight to find out if there’s a few pennies left over for the Lib Dems.
The Lib Dems also said they’d pay for tax cuts “by closing loopholes that unfairly benefit the wealthy and polluters”.
FactCheck revealed earlier this week that a promise in the coalition agreement to levy a a green air tax had fallen foul of EU law.
Now we can disclose that the Lib Dems have quietly dropped plans for a law to ensure the rich can’t avoid stamp duty by putting their properties into an offshore trust.
In its spin dossier, the party sneakily quotes half of their original manifesto promise.
Here’s how it read in 2010:
“We will tackle tax avoidance and evasion, with new powers for HM Revenue & Customs and a law to ensure properties cannot avoid stamp duty if they are put into an offshore trust.”
This is how it appears this week, as the party trumpets its efforts in launching a £900m crackdown on tax avoidance:
“We will tackle tax avoidance and evasion, with new powers for HM Revenue & Customs.”
Note the small detail left off the end – a promise that might have raised money immediately by closing off an obvious tax loophole, but which hasn’t seen the light of day.
And it’s not the only tax pledge to have fallen by the wayside. Vince Cable’s plan for a “Mansion Tax” of 1 per cent on properties worth over £2 million has also disappeared, although he’d already been forced to water it down after a mutiny by colleagues.
• The Lib Dems vowed to invest £2.5 billion in a “Pupil Premium” fund to help struggling pupils and give schools the resources to cut class sizes.
The scheme has materialised, but in a form that’s created serious doubt about how much good it will do.
First of all, the £2.5 billion will be phased in over five years, although there was no mention of this in the Lib Dem manifesto.
Schools in England will get an extra £430 for every pupil eligible for free school meals. But the money isn’t ring-fenced, the number of children registered for free meals is expected to jump by about 2.5 per cent and most importantly, the cash could be cancelled out by overall cuts to school budgets.
One independent think tank says the Government’s overall schools budget settlement means a 0.75 per cent real-terms cut in funding per pupil, on average, across schools.
The Institute for Fiscal Studies says the most we can say of the Pupil Premium is that “more deprived schools will see smaller cuts, and some will even see an increase in funding, with one in four pupils in schools seeing real-terms increases in 2011…A few very deprived schools will see real-terms increases of 2 per cent or more.”
So much for a £2.5bn cash bonanza for Britain’s underprivileged children, although the Lib Dems insist around 1.4 million are expected to benefit from it next year. We’ll have to wait until schools set their budgets to see whether that turns out to be true.
• The Lib Dems may be on surer ground when it comes to separating the retail and investment divisions of high street banking giants to insulate consumers from risky trading. But success on that front very much depends on the outcome of a report by the Independent Commission on Banking, due next month. It’s expected to recommend some kind of separation, but the issue is causing tensions between the Lib Dems and the Tories. One Senior Lib Dem told FactCheck it would be “high noon” for the Coalition if the party didn’t get a bank break-up. But the Chancellor is cautious about the plans.
And efforts to get banks lending again have had only mixed success. Under the Coalition deal with the banks – dubbed Project Merlin – banks will lend about £190bn to businesses this year, including £76bn to small firms. Lord Oakeshott left the Lib Dem front bench after the deal was agreed, accusing the banks of “taking the Treasury for a ride”.
• Nick Clegg is pushing ahead with a change in the law so constituents can force a by-election if their MP is found guilty of misconduct and is expected to unveil legislation before the summer.
• The Freedom Bill, published last month, reins in council and police powers to use CCTV and surveillance, police stop-and-search powers and the fingerprinting of schoolchildren. The Lib Dems have also scrapped ID cards, biometric passports and the practice of keeping innocent people’s DNA on the national police database.
• A referendum on a switch to an Alternative Vote (AV) system will take place on 5 May this year, something the Lib Dems are presenting as a success.
There’s been a bit of re-writing of history on this too. The new list of achievements conveniently neglects to mention that the party’s manifesto favoured the far more radical Single Transferable Vote system. AV was decided on as a compromise with the Tories – and a “miserable little compromise” at that, according to Clegg himself.
• Lord Strathclyde, the Tory leader of the Lords, says Nick Clegg will publish a bill proposing an elected upper chamber “in the next couple of months”. Lib Dems are keen to have a consolation prize in case they get defeated in the voting reform referendum.
Cathy Newman’s verdict
Try as they might, the Lib Dems haven’t got a great deal to crow about. Agreed, they have secured a referendum on voting reform, but current polls suggest they may well lose the vote on May 5. And yes, they ditched ID cards, but only because the Tories wanted to too.
The increase in the personal allowance is undoubtedly an achievement, but like their other “triumphs”, it was tainted by compromise. The pupil premium wasn’t nearly as generous as they would have liked, and as FactCheck reveals today, promises on tax avoidance have been chiselled away.
The reason why effigies of Nick Clegg are being paraded round Sheffield by protesters is that, for all that the Lib Dems have achieved in government, they’ve given away a lot. The U-turns on VAT and tuition fees are what many will remember, rather than giving a helping hand to mountain rescue teams – important as that undoubtedly is.
