A Holyrood Committee has concluded that reform to the way Scotland manages and delivers benefits related to industrial injuries and ill health at work is needed, but, has agreed by majority that the Scottish Employment Injuries Advisory Council Bill will not deliver this.
The Bill, introduced by Mark Griffin MSP, proposes that a Scottish Employment Injuries Advisory Council be established to provide expertise about support for people living with a workplace injury or disease.
Industrial Injuries Disablement Benefit is currently delivered by the UK Government’s Department for Work and Pensions on behalf of the Scottish Government. The delivery of this benefit is expected to become the responsibility of the Scottish Government in March 2026.
Witnesses characterised the current Industrial Injuries Scheme as failing to deliver for women and people from ethnic minority backgrounds. They also said that the current system is slow to effect change and does not consider modern occupations and diseases. The Committee understood and agreed with these concerns.
However, the Cabinet Secretary, Shirley-Anne Somerville, told the Committee that, even if the Bill was given Parliamentary approval, the Scottish Government would not be able to act on any recommendations the Council made regarding the benefit as it is constrained by its current agreement with the Department for Work and Pensions.
Furthermore, the Committee’s report raises concerns that the creation of a new, statutory body (which would work alongside other public bodies, like the Scottish Commission on Social Security), would add to an already cluttered public body landscape, making the social security system more complex to administrate.
The Committee did, however, share the frustration of witnesses and Mr Griffin regarding delays to the promised Scottish Government consultation on its approach to replacing the Industrial Injuries Scheme in Scotland.
The Committee urges the Scottish Government to provide detailed timings for this consultation.
Collette Stevenson MSP, Convener of the Social Justice and Social Security Committee, said:“The current Industrial Injuries Scheme, at over 70 years old, is inadequate. It fails to take account of modern work practices and diseases and does not deliver for women or people from ethnic minority backgrounds.
“However, a majority of the Committee believe that this Bill would not provide the reform that stakeholders want to see and recommend that it should not be agreed to.
“Instead, we call on the Scottish Government to urgently provide detailed timings for the consultation on its approach to replacing the Industrial Injuries Scheme in Scotland, so that workers who are injured, or suffer from ill health, because of their employment, can access the compensation they deserve.”
On Wednesday, the Scottish Government and COSLA released their anticipated (and widely leaked) consultation on Council Tax changes(writes Fraser of Allander Institute’s EMMA CONGREVE).
The proposals set out would see a repeat of the 2017 increases in band multipliers for properties in Band E – H with the consultation seeking views on whether the changes to the mulitpliers should be higher or lower, or not happen at all. .
Table 1 shows the proposed changes in the context of the original multipliers set out in 1993 and the reforms in 2017. The proposed changes would lead to an increase in the amounts paid of £139, £288, £485 and £781 per household (or dwelling in official council tax speak) for those in Band E, F, G & H respectively.
Table 1 – Council Tax Multipliers
Council Tax Band
Original multipliers
2017 reforms
New proposals
A
0.67
0.67
0.67
B
0.78
0.78
0.78
C
0.89
0.89
0.89
D
1.00
1.00
1.00
E
1.22
1.31 (+7.5%)
1.39 (+7.5%)
F
1.44
1.63 (+12.5%)
1.75 (+12.5%)
G
1.67
1.96 (+17.5%)
2.13 (+17.5%)
H
2.00
2.45 (+22.5%)
2.68 (+22.5%)
The consultation documents note a number of valid points, but fails to mention others that are fairly fundamental to the operation of the Council Tax. Here we cover some of the main issues.
A fundamentally flawed tax
Council Tax is a regressive tax. By regressive, this means that the average tax rate (the % of the tax base paid in tax) falls as the value of the tax base rises. For Council Tax, the tax rate depends on the property you live in, meaning the relevant tax base is property value (as of 1991 – an issue we’ll return to later). The highest valued properties pay a lower % of that value in their Council Tax bill.
The consultation document restates research that was completed as part of the 2015 Commission on Local Tax Reform that found that, in order for Council Tax in its current banded form to be progressive, the Band H rate would need to be in the order of 15x the Band A rate. Given this was based on 2013-14 property values, this figure may have since increased even further.
It is a shame that the government has not revisited the 2015 analysis to provide up-to-date figures. This is not an easy task (this author was involved in it the first time round!) but the data exists to repeat much of the Commission’s analysis. Updated figures would provide a better evidence base for judging their proposals.
However, updated figures would not change the overall position: the proposed changes would place Band H at 4x the Band A rate, far below values that would be required to become anything approaching progressive. The consultation document does not shy away from admitting this, stating that the proposals will not address ‘the fundamental regressivity of Council Tax’.
How do the proposed reforms link to ability to pay?
Although Council Tax is tied to property, it is income or savings that are required to pay the bill each year. As well as being regressive with respect to property, council tax is also regressive with respect to income. That is, as your income rises, the % of your income that you pay in the tax reduces.
There are some protections in the system to ensue those on the very lowest incomes do not pay some or any of their bill. The 2017 reforms also came with a condition that anyone who had income below the national average (median) would not pay any additional amounts if they were in Bands E – H. However, the regressivity with respect to income remains an issue that these reforms will not be able to address.
If we look at the impact of the proposals on the upper half of the income distribution (where we expect most people to be outwith any form of CTR protection), the average impact on Council Tax bills range from around an additional £200 – £320 a year.
In the context of some of the recent figures on increases on increases in mortgage increases, these figures look relatively sedate (although it may feel far from that, especially for those affected by mortgage increases too).
In addition, these numbers do not include any other form of discounts or exemptions which may reduce the additional amounts, such as the single person discount. Table 2 shows that, as a proportion of household income (and with the same caveats re not accounting for other discounts) this is between 0.7% and 0.5% (i.e. a half of 1%).
Table 2 also shows that although those higher up the income distribution will pay more, the proportion of income paid decreases as income rises: that is the proposed reforms will be regressive with respect to income. Those in the top 10% of income are likely to pay a lower proportion of their income in additional tax than those in the next income decile down.
Table 2 – Additional charges faced by the top half of the income distribution
Income decile group
Average additional charge
Average income (latest data)
Average additional charge as a % of household income
6
£201
£27,820
0.72%
7
£201
£31,928
0.63%
8
£222
£37,544
0.59%
9
£258
£46,384
0.56%
10 (i.e. top 10%)
£317
£64,896
0.49%
i Average income data is taken from the DWP Households Below Average Income dataset for 2021-2022. Average income in this table refers to a reference household with two adults and no children. Income is net of tax and transfers.
This is partly a result of incomes not being directly tied to value of the property you live in. Many critics of using property values as a basis for a recurring tax cite this issue, particularly for pensioners who may have lived in a home that has accrued in value over many years, but have a relatively low disposable income (although not low enough to qualify for Council Tax Reduction).
An additional factor relates to the fact that there are relatively few Band H properties where the highest charge applies: even in the top 10% of households less than 1% of households are in a Band H property, a similar proportion to households in the 9th income decile.
The elephant in the room: revaluation
An additional fundamental issue, absent from the consultation document, is the fact that the property values used to put properties into bands are based on 1991 values. Some properties have grown much faster in value than others since then.
That means that two properties that were in the same band in 1991 may now be worth vastly different sums of money, and if there was a revaluation today they would no longer be placed together in the same band.
The issue is further complicated by new builds where finding a comparable hypothetical 1991 value is difficult.
A quick look at any property website will provide you with all the evidence you need to illustrate the issue where property value and Council Tax Band are often quoted side by side.
For example, the market at the moment in Edinburgh:
A 2 bed ground floor flat for sale in the New Town for offers over £415,000 which is in Council Tax Band D (and therefore will not face the proposed additional charge)
A similarly sized 2 bed ground floor flat in Craigleith for offers over £210,000, which is in Council Tax Band E (which will face the proposed additional charge)
For those not familiar with Edinburgh geography, the locations are shown on the below map*.
This is not a one off. The Commission’s analysis in 2015 estimated that over half of all properties in Scotland would have changed band if revaluation had taken place in 2014.
We could speculate, at length, why revaluation has not happened. Scotland is not the only country that has struggled to find the political appetite to make it happen (the UK Government has done no better in England), but other parts of the UK have managed it in the last two decades.
What should be happening
Most people would agree that reforms to Council Tax need to go beyond tweaking multipliers. There are a number of options available, with a proportional tax on the value of a property being the majority view of the 2015 Commission, and indeed the previous Burt Commission that came up with similar proposals back in 2006.
However, any reform is contingent on the tax being levied on correct values. That means a revaluation is necessary. Indeed, it should be a prerequisite even for the type of tweaking that the Scottish Government did in 2017 and is proposing now given the majority of properties are likely to be in the wrong band.
To continue without revaluation is deeply unfair and to take forward reforms without a revaluation just rubs salt into the wounds.
*This map contains information from OpenStreetMap, which is made available here under the Open Database License (ODbL)
A new parliamentary inquiry into the Scottish Government’s public service reform programme has been announced.
Holyrood’s Finance and Public Administration Committee wants to examine the detail of the reform programme, which is focused on digitalisation, innovation, estates, public body landscape and procurement.
As part of this work, the committee will examine how public bodies are working to achieve the government’s plans to make efficiencies, while ensuring effective delivery of public services, in 2023-24 and beyond.
It will also consider the government’s ambitions to:
keep the public service pay bill costs at 2022-23 levels and
return the public sector workforce “broadly to pre-Covid-19 levels”.
“Further information on the government’s plans for reform and workforce levels were expected in the Scottish Budget 2023-24 but did not materialise due to ongoing economic turbulence.
“Our committee therefore wants to look at how public bodies are working to put in place the government’s ambitions for reform.“We also want to establish from where in the public sector reductions in headcount to pre-pandemic levels will be made, and to what timescales.
“Clarity and transparency around these issues are crucial, during what is an uncertain time for the public sector.”
A call for views from public sector bodies, academics, think tanks and other interested parties has been launched today, with a closing date of 1 May 2023.
To inform this inquiry, the committee is seeking written views from Scottish public bodies on their plans for public service reform in their sectors, and others with a view on how the reform programme is working in practice and how it is delivering effective and efficient services.
The committee is particularly keen to hear from:
all types and sizes of public sector bodies from across the public sector
others affected by the Scottish Government’s public service reform programme, and
think-tanks, academics and commentators on progress with, and outcomes from, the reform programme.
Chancellor to announce reforms to drive growth and secure the UK’s position as world leading financial services hub in Edinburgh today.
Ringfencing rules are set to be updated to release banks without major investment activities from the regime, regulators will be given a new remit to deliver growth and a widespread review will repeal hundreds of pages of EU law.
The Government will continue to deliver reforms across the economy to drive economic growth during challenging times.
Chancellor, Jeremy Hunt, will announce a package of over 30 regulatory reforms to secure the UK’s place as the world’s foremost financial centreduring a visit to Edinburgh today,
The “Edinburgh Reforms” will build on the unparalleled strength of the UK’s financial services sector, taking advantage of the opportunities provided by the UK’s exit from the European Union to tailor regulations to suit the country’s needs.
Today the Treasury will publish its plan to rigorously review, repeal and replace hundreds of pages of EU regulation ranging from disclosure for financial products to prudential rules for banks, creating a tailor-made UK regulatory framework based on international best practice that balances burden on business with protection for the consumer.
Rules that hold back growth will be reviewed, with overbearing EU rules which put companies off listing in the UK being overhauled, among dozens of regulations within scope of the Financial Services and Markets Bill.
The Government will also announce changes to ringfencing rules which currently require major banks to separate their retail and investment arms, and retail banks have to comply even if they don’t have an investment arm, a time consuming regulatory exercise.
Reforms will cut red tape and boost banking competition in response to the Skeoch review by freeing retail focused banks from ringfencing rules while maintaining protections for consumers. The UK’s world leading regulatory regime has evolved over the past decade and will continue to protect consumers and safeguard financial stability.
Chancellor of the Exchequer, Jeremy Hunt said: “This country’s financial services sector is the powerhouse of the British economy, driving innovation, growth and prosperity across the country.
“Leaving the EU gives us a golden opportunity to reshape our regulatory regime and unleash the full potential of our formidable financial services sector.
“Today we are delivering an agile, proportionate and home-grown regulatory regime which will unlock investment across our economy to deliver jobs and opportunity for the British people.”
This builds on the reforms to Solvency II announced in the Autumn Statement which will unlock over £100 billion for productive investment from UK insurers over the next decade, such as clean energy infrastructure.
The Chancellor is also expected to issue new mandates to the Financial Conduct Authority and the Prudential Regulation Authority setting out how they will help deliver growth and promote the international competitiveness of the UK.
The financial services sector is vital for Britain’s economic strength, contributing £216 billion a year to the UK economy. This includes £76 billion in tax, enough to fund the entire police force and state school system, while employing over 2.3 million people – with 1.4 million outside London and 163,000 people in Scotland.
While in Edinburgh today, the Chancellor will meet with top financial services CEOs to discuss these reforms and how the sector can further drive investment and growth in the UK.
As confirmed in the Autumn Statement, the government will look to announce changes to EU regulations in four other growth industries by the end of next year, including digital technology, life sciences, green industries and advanced manufacturing.
The public and organisations are being asked to give their views on improving access to information about public services.
The Access to Information Rights in Scotland consultation aims to gather views and evidence on what information rights should look like.
This includes whether additional third sector bodies and private businesses should be brought within the scope of existing freedom of information (FOI) legislation, if they carry out work for the public sector or receive public funds, as well as what information should be published proactively by Government and public services.
The consultation also looks at whether guidance on the use of different technology platforms should be introduced.
Minister for Parliamentary Business George Adam said: “Scotland has the most robust FOI laws in the UK.We want to build on this further by engaging with people and organisations on the development of information rights.
“We want to understand how existing legislation affects the work of civil society groups and public bodies.
“The responses to the consultation will inform our work to improve FOI rules and deliver on the Scottish Government’s commitment to openness and transparency.
“I would urge those with experience of FOI, whether as requesters, public authorities or as partners of public authorities to respond to the consultation and let us know your concerns and experiences.”
“This is the most ambitious reform of public services since the creation of the NHS” – Humza Yousaf
Legislation to establish a National Care Service for Scotland (NCS) will ensure the best possible outcomes for people accessing care and support and end the ‘postcode lottery’ of care, says the Scottish Government.
The National Care Service Bill will make Scottish Ministers accountable for adult social care in Scotland – a change strongly supported by those responding to the recent consultation on the plans.
The Bill provides the foundation for the NCS, and enables the fine detail of the new service to be co-designed with people who have direct experience of social care services.
Plans have also been published to explain how that collaboration will work.
The aims are to:
support people in their own homes or among family, friends and community wherever possible, with seamless transitions between services;
create a charter of rights and responsibilities for social care, with a robust complaints and redress process;
introduce rights to breaks for unpaid carers
introduce visiting rights for residents living in adult care homes, giving legal force to Anne’s Law
ensure fair employment practices and national pay bargaining for the social care workforce;
focus on prevention and early intervention before people’s needs escalate;
create a new National Social Work Agency to promote training and development, provide national leadership and set and monitor standards in social work.
On a visit to Aberdeen-based charity VSA, which supports people with a wide range of social care needs, Cabinet Secretary for Health and Social Care Humza Yousaf said: “This is the most ambitious reform of public services since the creation of the NHS.
“People have told us they want a National Care Service, accountable to Scottish Ministers, with services designed and delivered locally. That’s exactly what we are going to deliver.
“The design of the NCS will have human rights embedded throughout, and the actual shape and detail of how the NCS works will be designed with those who have direct experience of accessing and providing social care.
“We are going to end the postcode lottery of care in Scotland. Through the National Care Service we’re going to ensure everyone has access to consistently high-quality care and support so they can live a full life. This is our ambitious goal and while it will not be easy to achieve it is vital that we do.”
Social Care Minister Kevin Stewart said: “One of the key benefits of a National Care Service will be to ensure our social care and social work workforce are valued, and that unpaid carers get the recognition they deserve.
“When this Bill passes we will be able to have the new National Care Service established by the end of this parliament. In the interim we will continue to take steps to improve outcomes for people accessing care – working with key partners, including local government, and investing in the people who deliver community health and social care and support.”
Chief Operating Officer of VSA Aberdeen John Booth, said: “We welcome the announcement that the National Care Service Bill has been published. With this being the biggest reform since the creation of the NHS we will now take the time to properly review the bill to understand the opportunities and challenges that lie ahead.
“We look forward to working with the Scottish Government to co-design the NCS to ensure the voices and needs of the vulnerable people who rely on our vital services are heard.”
Local government umbrella body COSLA has issued a statement:
A massive restructuring project, limited resources, local government opposition … Now, what could possibly go wrong?
Three national organisations are to be announced – created to drive improvement in education.
A new public body will be responsible for developing and awarding qualifications. It will replace the Scottish Qualifications Authority (SQA) and it will have a governance structure that is more representative of, and accountable to, learners, teachers and practitioners.
A national agency for education will see Education Scotland (ES) replaced. The new executive agency will provide improved support and professional learning to teachers and schools, and provide advice and guidance on curriculum, assessment, learning and teaching.
Thirdly, a new and independent inspectorate body will be created. It will develop new inspection models and help to assess the overall performance of Scottish education.
The organisations will be required to work more closely with learners and education professionals.
ES and SQA will continue to deliver their functions while the new bodies are being developed, ensuring continuity for learners, including those sitting exams.
The new organisations were announced as part of the Scottish Government’s response to a report on reform of the SQA and ES by independent adviser Professor Ken Muir, University of the West of Scotland.
The Scottish Government has broadly accepted all of Professor Muir’s recommendations, including making a commitment to lead a national discussion on the vision for the future of education.
Education Secretary Shirley-Anne Somerville said: “The three new education bodies will be underpinned by new values and governance. I have also announced my intention to work in partnership to build a new vision for Scottish education.
“These changes are designed to improve outcomes and build trust in Scotland’s education system. Our renewed system must reflect the culture and values we want to see embedded throughout; it must be a system that puts learners at the centre and provides excellent support for our teachers and practitioners.
“It must also be a system where there is clear accountability – democratic accountability, organisational accountability but also accountability to the learners, who have a right to expect the highest quality of learning and teaching while giving them the best chance of success.”
Professor Muir said: “As our students and society change over time, so too do our expectations of what we want and need from our education system. It is important that Scottish education reflects and responds to those changes in ways that offer opportunities for all current and future learners to thrive.
“The recommendations in my report are designed to ensure that the needs of every individual learner lie at the heart of all decisions taken and all that we do.
“They are designed to ensure that the voices of learners, teachers and practitioners have greater prominence and influence in decision making and that teachers and practitioners receive the support they need in carrying out their challenging and critically important teaching role.”
Prime Minister Boris Johnson’s statement at yesterday’s press conference on health and social care:
Good afternoon, I’m joined by the Chancellor of the Exchequer and the Secretary of State for Health and Social Care, because today we’re setting out our plan to help our NHS recover from the pandemic and build back better by fixing the problems in health and social care that governments have avoided for decades.
We all know someone whose test, scan or hip replacement was delayed or who helped to protect the NHS amid the immense pressures of Covid by putting off treatment for a new medical condition.
And now, as people come forward again, we need to pay for those missed operations and treatments; we need to pay good wages for the 50,000 extra nurses we are recruiting, we need to go beyond the record funding we’ve already provided to the NHS, and that means going further than the 48 hospitals and 50 million more GP appointments.
So today, following the most successful vaccine programme in the world, we’re beginning the biggest catch-up programme in the history of the NHS, increasing hospital capacity by 110 per cent, and enabling 9 million more appointments, scans and operations.
I have to level with people – waiting lists will get worse before they get better, but compared with before Covid, by 2024/25 our plan will allow the NHS to aim to treat 30 per cent more patients who need elective care – like knee replacements or cancer screening.
A recovery on this scale cannot be delivered by cheese-paring budgets elsewhere and it would be irresponsible to cover a permanent increase in health and social care spending with higher day to day borrowing.
For more than 70 years, we’ve lived by the principle that everyone pays for the NHS through our taxes, so it’s there for all of us when we need it.
In that spirit, from April we will have a new UK-wide 1.25 per cent Health and Social Care Levy on earned income, with the money required by law to go directly to health and social care across the whole of our United Kingdom, and with dividends rates increasing by the same amount.
This will raise almost £36 billion over the next three years, not just funding more care but better care, including better screening equipment to diagnose cancer earlier and digital technologies allowing doctors to monitor patients in their homes.
The levy will share the cost as fairly as possible between people and businesses: because we all benefit from a well-supported NHS and all businesses benefit from a healthy workforce.
And those who earn more will pay more, including those who continue to work over the State Pension Age.
The highest earning 14 per cent of the population will pay around half of the revenue raised; no-one earning less than £9,568 will pay a penny, and most small businesses will be protected, with 40 per cent paying nothing extra at all.
And this new investment will go alongside vital reform, because we learned from the pandemic that we can’t fix the NHS unless we also fix social care.
When Covid struck, there were 30,000 hospital beds in England occupied by people who would have been better cared for elsewhere, and the inevitable consequence was that patients could not get the hip operations or cancer treatment or whatever other help they needed.
And those people were often in hospital because they feared the costs of care in a residential home.
If you suffer from cancer or heart disease, the NHS will cover the costs of your treatment in full.
But if you develop Alzheimer’s or Parkinson’s, then you have to pay for everything above a very low threshold.
Today, 1 in 7 of us can expect to face care costs exceeding £100,000 in our later years, and millions more live in fear that they could be among that 1 in 7.
Suppose you have a house worth £250,000 and you’re in a care home for eight years, then once you’ve paid your bills, you could be left with just £14,000 after a lifetime of work, effort and saving – having sacrificed everything else – everything that you would otherwise have passed on to your children – simply to avoid the indignity of suffering.
So we are doing something that, frankly, should have been done a long time ago, and share the risk of these catastrophic care costs, so everyone is relieved of that fear of financial ruin.
We’re setting a limit to what people will ever have to pay, regardless of assets or income.
In England, from October 2023, no-one starting care will pay more than £86,000 over their lifetime.
Nobody with assets of less than £20,000 will have to pay anything at all, and anyone with assets between £20,000 and £100,000 will be eligible for means-tested support.
And we’ll also address the fear many have about how their parents or grandparents will be looked after.
We’ll invest in the quality of care, and in carers themselves, with £500 million going to hundreds of thousands of new training places, mental health support for carers and improved recruitment, making sure that caring is a properly respected profession in its own right.
And we’ll integrate health and social care in England so that all elderly and disabled people are looked after with the dignity they deserve.
No Conservative Government wants to raise taxes, but nor could we in good conscience meet the cost of this plan simply by borrowing the money and imposing the burden on future generations.
So I will be absolutely frank with you: this new levy will break our manifesto commitment, but a global pandemic wasn’t in our manifesto either, and everyone knows in their bones that after everything we’ve spent to protect people through that crisis, we cannot now shirk the challenge of putting the NHS back on its feet, which requires fixing the problem of social care, and investing the money needed.
So we will do what is right, reasonable and fair, we’ll make up the Covid backlogs, we’ll fund more nurses and, I hope, we will remove the anxiety of millions of families up and down the land by taking forward reforms that have been delayed for far too long.
Chancellor Rishi Sunak’s statement on health and social care, delivered on 7 September 2021
Good afternoon.
I want to address straight away the following question:
Why do we need to raise taxes?
Three reasons.
First, we need to properly fund the NHS as we recover from the pandemic.
Senior NHS leaders have made clear that without more funding we will not properly be able to address the significant backlog…
…in people’s cancelled operations, delayed treatments, or missed diagnoses.
To get everyone the care they need is going to take time – and it is going to take money.
The second reason is that social care plans announced today have created an expanded safety net.
Instead of individuals having to bear the financial risks of catastrophic care costs themselves, we as a country are deciding to share more of that risk collectively.
This is a permanent, new role for the Government.
And as such we need a permanent, new way to fund it.
The only alternative would be to borrow more indefinitely.
But that would be irresponsible at a time when our national debt is already the highest it has been in peacetime.
And it would be dishonest – borrowing more today just means higher taxes tomorrow.
The third reason we need to raise taxes is to fund the Government’s vision for the future of health and social care.
Properly funded, we can tackle not just the NHS backlog and expand the social care safety net, we can afford the nurses pay rise;
Invest in the newest, most modern equipment;
Prepare for the next pandemic;
And provide one of the largest investments ever to upskill social care workers.
In other words, we can build the modern, more efficient health and social care services the British public deserves.
To fund this vital spending, we will introduce a new UK-wide Health and Social Care Levy.
From next April, we will ask businesses, employees and the self-employed to pay an extra 1.25% on earnings.
All the money we raise will be legally ringfenced, which means every pound from the Levy will go directly to health and social care.
The Levy is the best way to raise the funds we need.
It is fair: the more you earn, the more you pay.
It is honest: it is not a stealth tax or borrowed – the Levy will be there in black and white on people’s payslips.
And it is UK-wide, so people in England, Scotland, Wales and Northern Ireland will all pay the same amount.
To make sure everyone pays their fair share, we will also increase dividend tax rates by the same amount.
And, from 2023, people over the age of 66 will be asked to pay the Levy on their earnings too.
No Government wants to have to raise taxes.
But these are extraordinary times and we face extraordinary circumstances.
For more than 70 years, it has been an article of faith in this country that our national health service should be free at the point of use, funded by general taxation.
If we are serious about defending this principle in a post-Covid world …
… we have to be honest with ourselves about the costs that brings …
… and be prepared to take the difficult and responsible decisions to meet them.
Thank you.
PM Boris Johnson’s letter to the First Ministers of Scotland, Wales and Northern Ireland and Deputy First Minister of Northern Ireland on the new health and social care reform:
National Insurance Contributions increase ‘adds insult to injury’ for families facing devastating cut to Universal Credit
New Joseph Rowntree Foundation analysis estimates that around 2 million families on low incomes who receive Universal Credit or Working Tax Credit will pay on average around an extra £100 per year in National Insurance contributions under the Government’s proposed changes.
Peter Matejic, Deputy Director of Evidence & Impact at JRF said:“We are concerned that around two million families on low incomes who receive Universal Credit or Working Tax Credit will pay on average around an extra £100 per year in national insurance contributions under the Government’s proposal.
“This extra cost adds insult to injury for these families who are facing a historic £1,040 cut to their annual incomes when Universal Credit and Working Tax Credit are reduced in less than a month on 6 October. If it presses ahead, this Government will be responsible for the single biggest overnight cut to social security ever.
“With inflation rising, the cost of living going up and an energy price rise coming in October, many struggling families are wondering how on earth they will be expected to make ends meet from next month.
“The Chancellor is in denial if he seriously believes this cut will not impose unnecessary hardship on millions of families – the majority of whom are in low-paid work.
“Any MP who is concerned about families on low incomes must urge the Prime Minister and Chancellor to reverse this damaging cut, which will have an immediate and devastating impact on their constituents’ living standards in just a few weeks’ time.”
RCEM welcomes Government funding, but warns it won’t be enough
Responding to the announcement of an extra £5.4 billion of funding for the NHS, Dr Katherine Henderson, President of the Royal College of Emergency Medicine, said: “The announcement of this additional funding for the NHS over the next six months is very welcome.
“It comes at a crucial time when the health service enters what will likely be its most challenging winter ever, as it exits the pandemic, seeks to recover the elective backlog and faces the worst ever levels of performance in the summer.
“It is particularly welcome to see the investment in improving infection prevention control measures in hospitals, as this will continue to be of the utmost importance in the coming months. It is also pleasing to see funding to continue to improve the timely discharge of hospital patients. It is vital for Emergency Care that there is good flow throughout the hospital, which includes making sure patients have a smooth discharge from the hospital.
“While this short-term funding is appreciated, there must also be an adequate response to the sharp increase in demand and equivalent deterioration in performance. It is unlikely that this funding will be enough to help enable longer term recovery.
“The challenges that our Emergency Departments face stem from workforce shortages and capacity issues. A shortage of beds can lead to crowding, corridor care and poor flow through the hospital. Workforce shortages spread existing staff thinly and put them under severe pressure.
“These are long term issues and the only way to tackle them will be via a long-term funding plan for the health service, including a workforce plan to recruit nurses and doctors by expanding student medical and nursing places and training places.”
Dr Katherine Henderson, commenting on the announcement of a three-year settlement for health and social care, continued: “The three-year funding settlement announced for health and social care is welcome.
“But the scale of the challenges faced across the health and social care service at a crucial time of recovery mean this will likely not be enough – and the government must be realistic in the colossal task ahead for the health and social care service. It is essential that a plan to address the workforce crisis is prioritised.
“It is also welcome to see the long overdue the first steps towards a plan for social care. There has been a crisis within social care for some time, so it will be good to see the government fulfil its pledge to reform and tackle the social care crisis.
“For that to happen, it is vital that an adequate proportion of the settlement is allocated to social care.”
Commenting on Tuesday’s social care announcement by the Prime Minister, TUC General Secretary Frances O’Grady said: “We need a social care system that delivers high-quality care and high-quality employment.
“New funding for social care is long overdue. But today’s announcement will have been deeply disappointing both to those who use care, and to those who provide it.
“The Prime Minister promised us a real plan for social care services, but what we got was vague promises of money tomorrow.
“Care workers need to see more pay in their pockets now. Nothing today delivered that. Instead, the only difference it will make to low-paid care staff is to push up their taxes.
“This is so disappointing after the dedication care workers have shown during this pandemic keeping services running and looking after our loved ones.
“Proposals to tax dividends should have been just once piece in a plan to tax wealth, not an afterthought to a plan to tax the low-paid workers who’ve got us through the pandemic.
“We know social care needs extra funding. But the prime minister is raiding the pockets of low-paid workers, while leaving the wealthy barely touched.
“We need a genuine plan that will urgently tackle the endemic low pay and job insecurity that blights the social care sector – and is causing huge staff shortages and undermining the quality of care people receive.”
The TUC published proposals on Sunday to fund social care and a pay rise for the workforce by increasing Capital Gains Tax.
The union body says increasing tax on dividends is a welcome first step to reforming the way we tax wealth, but that it won’t generate the revenue needed to deliver a social care system this country deserves.
Instead, by taxing wealth and assets at the same level as income tax, the government could raise up to £17bn a year to invest in services and give all care staff a minimum wage of £10 an hour.
TUC analysis shows that seven in 10 social care workers earn less than £10 an hour and one in four are on zero-hours contracts.
Polling published on Sunday by the TUC showed that eight in 10 working adults – including seven in 10 Conservative voters – support a £10 minimum wage for care workers.
Openness and transparency are the key foundations of any democracy. But today we find too much of our politics is shrouded in secrecy. Too often voters remain unsure about who is behind the messages they read, who is behind the information that shapes their political views, and ultimately their votes. In no area is this truer than online campaigning (writes JESSICA BLAIR).
Nine months on from the general election, we still have little idea how much money was spent in the campaign. But even when the data is published by the Electoral Commission, huge gaps will remain in our understanding of how voters were targeted – and by whom.
Democracy is about empowering citizens so that they can actively take part in our political processes and make an informed decision at the ballot box. Transparency, fairness and accountability in political campaigning are key to ensuring this is possible. But while technology offers huge opportunities for political engagement, the current system – if it can be called that – is an unregulated Wild West.
Indeed, the Electoral Commission’s own post-election research found that ‘[m]isleading content and presentation techniques are undermining voters’ trust in election campaigns’ and that the ‘significant public concerns about the transparency of digital election campaigns risk overshadowing their benefits’.
Democracy in the Dark, a new report commissioned by the Electoral Reform Society and written by Dr Katharine Dommett and Dr Sam Power, sheds light on campaigning in the 2019 general election.
For the first time, the authors reveal how much was spent on social media platforms by campaigners and parties during the election, and track the rise of non-party ‘outriders’, with all the associated secrecy.
However, it’s not enough to just point out the risks. Dommett and Power also summarise the many sensible, proportionate and easily implementable recommendations, around which there is broad and cross-party consensus, as to how we can restore trust in our democratic processes.
These reforms would shine a light on the murky world of unregulated online campaigning, focusing on five key areas: 1. Money; 2. Non-party campaigns; 3. Targeting; 4. Data; 5. Misinformation.
Many of the recommendations in this report echo existing calls to modernise electoral law to help rebuild trust in our democratic system. Recommendations include closing funding loopholes, creating national standards for social media ad transparency and ensuring voters can easily see who is targeting them and why.
Since we published our report Reining in the Political Wild West in 2019, countless calls have been made across the political spectrum in support of reform and there continues to be strong and long-standing cross-party support to tame the unregulated Wild West of online political campaigning.
Yet despite repeated calls for reform, little action has been taken. Strikingly, far from becoming more transparent, the authors find that in the wake of the Cambridge Analytica scandal, parties and campaigners have become even more cautious about disclosing information about their campaign activities online.
In terms of progress, the most significant step has been the launch of a consultation on extending the use of imprints to include online election material – a necessary step, but which on its own is woefully insufficient.
Such limited efforts have further been undermined by alleged threats to abolish the Electoral Commission if it cannot be ‘radically overhauled’. Rather than enhancing the Commission’s powers and resources so that it can tackle the challenges of the modern age, the body tasked with protecting our democracy is under unprecedented attack.
With elections due to take place across the UK in May 2021, we cannot let the urgent task of ensuring our electoral integrity be kicked into the long grass once more.
For all the divisions on display in this election campaign, there’s one point nearly all voters agree on: the desperate need for reform in Westminster.
Yet despite many parties commenting on the need for change in their manifestos, the issue of political reform has been dangerously absent from the campaign trail.
This radio silence is indefensible when polling for the Electoral Reform Society shows 85% of people feel that politics isn’t working, and 80% feel they have little or no influence on decision-making today. With public faith this low our politicians cannot afford to stay silent.
The signs of democratic decay are all around us – from an electoral system that wastes votes on an industrial scale, to the private members’ club that is the unelected House of Lords. This year we’ve seen our parliament lunge from crisis to crisis.
This election is a watershed moment for our democracy – inaction is not an option. Today we are calling for leaders to make the issue of updating and transforming Westminster front and centre, as part of #DemocracyDay.
We are asking them all to commit to a constitutional convention involving citizens, to set out how to reform Westminster after the election.
There is a high degree of cross-party unity around issues like updating Britain’s analogue-age campaign rules, spreading power outside of London and reining in our crumbling constitution.
With trust in politics at record lows, voters want to see parties open up about how to overhaul Westminster. Today is an opportunity to do just that. It is time for all parties to present their proposals with pride and passion.
Let’s start to build a better politics.
Willie Sullivan Electoral Reform Society Ruth Lister Compass Klina Jordan and Joe Sousek Make Votes Matter Frances FoleyCitizens Convention UK Alexandra Runswick Unlock Democracy Neal Lawson Up To Us Anthony Barnett OpenDemocracy Jennifer Nadel Compassion In Politics Matteo Bergamini Shout Out UK Tabitha Morton More United Richard Murphy Professor of International Political Economy, City, University of London Heidi Allen and Peter Dunphy Unite to Remain Ed Dowker Represent.me Mark Cridge mySociety Richard Tunnicliffe and Sue Ellar Represent Us Dimitri Scarlato the 3million Paul Thistlethwaite XR Future Democracy Hub Indra Adnan The Alternative Andrew Pendleton New Economics Foundation John Doolan and Paul Blomfield Labour Campaign for Electoral Reform Keith Sharp Liberal Democrats for Electoral Reform Frances Scott 50:50 Parliament Jon Christensen Tax Justice Network
