Business Magazine

Osborne’s Funny Money

Posted on the 21 November 2014 by Craig Ryan @CraigA_Ryan

Only just getting round to this but, in case you missed it, there’s some good work here from Richard Murphy at Tax Research UK, who has recast George Osborne’s personal tax statement (it’s actually nothing of the kind), to show where your money really goes.

Where your money really goes – public spending breakdown by Richard Murphy, Tax Research UK.Where your money really goes – public spending breakdown by Richard Murphy, Tax Research UK.

Now, you can argue the toss over some of Richard’s methodology, assumptions and so on, but the main point is that it’s ridiculous for Osborne’s “statement” to leave out all the reliefs and allowances given to (mostly wealthy) people and businesses – other taxpayers have to foot the bill for them just as they do for any other sort of benefit. As Richard’s chart shows, these add up to twenty times more than is spent on unemployment benefit.

According to the Treasury, a tax credit paid to a working family counts as welfare spending, but a tax credit given to a billionaire property owner doesn’t count as spending at all. The only reason for the distinction is that Osborne doesn’t want you to know about the latter.

Two other points:

First, most pensions aren’t welfare. State pensions aren’t means tested and people make contributions to them throughout their working lives. It’s called National Insurance.

Second, have Osborne’s figures been cleared by the Office for Budget Responsibility? If not, why not? After all, Osborne made a lot of noise about transparency and independence with fiscal data when he set up the OBR. And should he be allowed to get away with spending public money on this sort of propaganda six months before a general election (or at any time for that matter)?


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