Labour\’s kept promise

No, really, they have kept one. They promised to bash the rich and give to the poor.

The richest households are up to 15 per cent worse off than they would have been without the successive tax changes Labour has introduced since 1997, while the poorest are more than 12 per cent better off……Any household with a total take-home income of £29,791 — about £40,000 before tax — had lost under Mr Brown’s tax and benefits policies, the institute calculated.

And they\’ve done that.

Make sure you note the difference between individual income and household income there. £40k individual income puts you in the top 10% of the income distribution. Don\’t think it does for household income. Two people on median incomes for example would have a household income over that £40 k before tax.

Now, whether you think it right that a household so modestly ahead of the game should have their taxes raised to pay for the expansion of outreach diversity advisors is another matter. But this is what Labour said they would do and this is indeed what they have done.

5 thoughts on “Labour\’s kept promise”

  1. Here’s the chart by decile. 40k/year is the 7th decile, and it’s not really until the 8th that there’s a big change. As the provider of this chart says that the Telegraph characterises this as ‘middle income earners’ losing out is quite beautifuil.

    Btw, you do realise that a Citizen’s Basic Income would see those on above average income subsidising the spending of those on below average income, don’t you?

    http://4.bp.blogspot.com/_AWie8d6I_pI/S6vohdiJyrI/AAAAAAAAAf4/eXh58uadexU/s1600/ifs+ditrib+2.jpg

  2. “Citizen’s Basic Income would see those on above average income subsidising the spending of those on below average income”

    More to the point, it would see those who work subsidising the spending of those who don’t.

  3. Matthew,

    That’s a great chart, can you direct me to its source?

    I’d love to see an equivalent chart showing 1979 to 1997. I’d also like to know if the sterling value of the losses is less, more or equivalent to the sterling value of the gains.

  4. It’s interesting that the report is getting the government roughly equivalent levels of bashing from the left and right.

    The left are focusing on final income distribution stats (income + benefits – tax) to show that the UK has got more unequal under Labour and hence they’re just Tories in disguise, whilst the right are focusing solely on the distribution of (benefits – tax) to show that Labour have stolen all their money and hence are just Commies in disguise.

    Whereas in fact, Labour’s approach of globalisation and deregulation plus higher taxes and benefits has had both effects – it’s made the country much richer (current recession notwithstanding), whilst mitigating many of the inequalities associated with globalisation and deregulation. What’s not to like?

  5. Mr Potarto – the immediate source was that blog with the same URL, the original source is the latest Institue for Fiscal Studies publication which you’ll find on their website (sorry can’t be more specific)

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