Coffee House

Why Ed Balls is so confident about benefit wars

14 December 2012

The debate over benefit uprating will run and run because both sides think they are winning. George Osborne thinks the public resent generous benefits rises. Liam Byrne and Ed Balls want to call this a ‘strivers tax’ and think blue collar workers will fall into their arms. Byrne told Coffee House yesterday that Labour will be hurt opposing to the Welfare Uprating Bill.

I understand that the Shadow Cabinet reached its decision after YouGov’s polling showing C2DE  voters  – the three lowest socio-economic groups – saying benefits should have been increased in line with inflation. Osborne’s Bill would increase welfare by 1pc, behind expected inflation. Some 42 per cent of C2DE respondents said it was wrong, 28 said it was right, 15 per cent proposed no increase at all on benefits. Polling after Ed Balls had confirmed the party’s position showed 59 per cent of voters backed Labour’s opposition. Hence the smile on Balls’ face

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I understand that Labour believes that families on working tax credits (also affected by the real-terms freeze) could turn against the Conservatives in key marginal constituencies. In Dan Byles’ North Warwickshire constituency, for instance, the MP has a majority of only 54, while there are 6,800 families on working tax credits. Similarly, George Eustice has a majority in his Camborne and Redruth constituency of 66, but there are 7,100 families on working tax credits. A Labour source tells me:

‘Osborne, in search of a welfare dividing line, has just cost the careers of dozens of his colleagues because the losers outweigh a Tory majority by a factor of several.’

Hence the enthusiasm on both sides to keep this going: neither believe they have anything to lose by provoking the other.

P.S. Whether Labour is actually right to be quite so happy about its position on benefits is a matter Jonathan will address shortly on Coffee House.

UPDATE: Jonathan has posted on why Labour’s confidence is mis-placed: it’s worth a read as it shows that the party may hope that those on working benefits will vote for them, but they still don’t have the evidence to back that up.

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  • andagain

    Some 42 per cent of C2DE respondents said it was wrong, 28 said it was
    right, 15 per cent proposed no increase at all on benefits.

    So 42% wanted a bigger increase, 43% wanted the same or smaller increase, and 15% had no opinion. That is not overwhelming opposition to Osbourne. And the ABC1s, who were asked if they wanted money to be given to people other than themselves, were presumably less opposed toOsbourne. What spending cut or tax rise do Labour hope to find that is more popular?

  • Theodoxia

    Osborne may lose his party thousands of votes by this policy, perhaps, at the same time gaining very few. Meanwhile Cameron will be losing the same party hundreds of thousands of votes without gaining a single one by his proposals for same-sex marriage (the same policy which his friend George also imagines is a vote winner).

    Between them they are helping to make a vote for UKIP in 2015 a no-cost, attractive option.

  • HooksLaw

    The labour tactic ignores the big increases in the tax free allowance.

    • realfish

      As has the BBC.

    • facebook-574311716

      £47 pa, isn’t it, above the normal indexed increase? Hardly big and certainly much smaller than the losses incurred by anyone being shortchanged on benefit increases.

  • Sally Chatterjee

    Surely this proves Labour has made people dependent on state spending, expanding the welfare state from the needy to those wanting a top up?

    High time this was ended. The idea of people in work, paying tax being and then waiting for a tax credit is daft. Why not just just cut the tax rate?

    • 2trueblue

      Which is what the coalition has begun to do. Under 13yrs of Liebore child poverty actually grew, the gap between rich and poor grew, and youth unemployment grew. Wages actually grew at half the pace of benefits, so tell me how do they manage to spout such rubbish.

  • Jebediah

    What a crap country we live in when we bribe voters with their own money. What is the point of tax credits? Cut out the middle man and don’t take the money off them in the first place.

    • HellforLeather

      “…. when we bribe voters with their own money.” Err, Umm.

      The voters being bribed are the state dependents encouraged by Labour largesse, the Labour client state who do not contribute via employment tax. The rest pay for them (and in what way are the latter being bribed)?

  • don logan

    I think you’ll find that no-one is listening to the big fat cry baby.

  • Russell

    Another ‘balanced ‘ report from Isabel. “while Osborne thinks he can wreak damage” Balls and Byrne are “happy to prolong the argument”. really! Ed and labour central are no doubt delighted with your continued ‘hidden’ negative suggestions about the tories along with ‘splits in the coalition’ pieces.,

    • IsabelHardman

      No, Russell, I’m reporting why they think they are right. I don’t agree that they are, but I’m still reporting it because it’s a curious position to take.

      • lee taylor

        Just to butt in I would like a response to my comment about your misunderstanding of the IpsosMORI poll finding.

        You say above that many of those who receive child tax credit don’t consider themselves benefit claiments and I agree but that’s also most likely true of those who also receive child benefit.

        As I pointed out earlier the IpsosMORI poll mentioned Child Benefit and JSA in it’s build up to the question which asked the respondents ‘what do you think of THESE benefits?’ therefore many who woudln’t normally see themselves as benefit claiments would have considered themselves when answering the question.
        YouGov asked about benefits in general without making any mention of any specifc benefit thus most respondents especially those in receipt of CB and/or CT would not have considered themselves when answering the question.
        I think it is wholly inaccurate to suggest that people have suddenly been won over by Labour’s argument as you do.

    • IsabelHardman

      p.s. for what it’s worth, and as I said, Jonathan will explain this in a post shortly, many people on working tax credits don’t see themselves as benefit claimants, and so won’t attribute a smaller rise in their payments to a decision by George Osborne. This is the flaw in Labour’s argument. But that doesn’t mean we shouldn’t report what they think for your scrutiny…

  • LB

    Just wait until the skivers find out what Labour have done with their pension money.

    eg. 4,700 bn of debt.

    For a 26K a year worker, they have lost 420,000 pound compared to what they could have got investing the the ‘risky’ FTSE.

    Since the government pension is only 130,000 pounds worth, and that’s the bulk of the 4,700 bn of debt, they aren’t going to get that.

    It’s fraud.

  • Whyshouldihavetoregister

    Skivers in favour of being paid to skive. Not news.

    • John Stedham

      Work yourself do you? How do you find time to write these comments?

  • Archimedes

    Far more notable than the polling is the direction of travel. I doubt the figures would have been the same six months ago. Labour are winning the argument, and Osborne needs to find a new way to phrase his. Osborne cocked this one up.

    • lee taylor

      Utter tosh. What Isobel failed to notice was that the latter poll she referred to asked specifically about JSA and Child Benefit rather than all benefits in general.
      Furthermore the same poll showed that 63% believed that those on benefits were either paying the right amount or too little towards the deficit.
      Only those who are ignorant of the difference in the way in which each pollster phrase their question can think that Labour are winning the argument.

      • Archimedes

        Nope. Osborne cocked it up. Labour have defined the Conservative position more than the Conservatives have defined it themselves. He has categorically lost control of the argument, and so he will lose. Labour don’t have to propose a rise, or even a rise in line with inflation, they can just oppose Osborne’s real term cut.

        • lee taylor

          I think you’ve paid too much attention to their soundbites.

          • Archimedes

            Oh, you’re probably right – good thing the public isn’t so fickle, and like to dive deep in their analyses.

    • Chris lancashire

      I’m not quite sure what you mean by the “direction of travel”. All I see from the above is that 42% of recipients of benefits think they should have got more and 58% think they shouldn’t. If that’s from the client sector then looks like Osborne has it right and Balls, not for the first time, has it wrong.
      However, it’s not just the “C2DEs” (!) imagine how Labour’s “let’s keep on spending large amounts on benefits” policy plays with the public and taxpayers at large.

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