Osborne’s Attack on National Insurance as Jobs Tax and the Privatisation of the NHS

Last Thursday, Gorgeous George delivered his ‘state of the economy’ address. This was muddled and contradictory. Osborne seemed to be trying to be optimistic, declaring that the economy was recovering, while at the same time saying it was still in a parlous state and more cuts needed to be made. Mike has provided an excellent critique of his speech over at Vox Political. It can be found at http://mikesivier.wordpress.com/2013/12/07/the-state-of-osborne-a-visitors-guide/. One of the most significant parts of his speech was where the Chancellor described National Insurance as a tax on jobs, and stated that he was repealing it for those age 18-21 to get them into work. This seems to have been lauded, at least on the BBC, as a positive move. Points West, the local news programme on BBC 1 for Bristol, Gloucestershire and Somerset, did a piece that evening commenting on George’s speech, with one of their journalists reporting from one of the region’s factories. He interviewed one of the firm’s managers, who concurred entirely with Gideon’s comments about NI. Yes, he said, they’d like to employ more young people, but they were prevented by the costs of National Insurance. He then repeated Gideon’s comments about it being a tax on jobs.

This criticism of National Insurance rang alarm bells in me. A little while ago I was talking to a friend of mine, who told me that he’d been arguing with a Conservative on the net. This Tory was repeatedly arguing that Britain could no longer afford the NHS. My friend had been arguing that contrary, and tried to show that the NHS was not only more competitive and efficient than the social insurance schemes or completely privatised systems the Lib-Dems and Conservatives favour, but it could be made entirely affordable through increased NI contributions. This had not impressed the Tory, who continued posting the nonsense about the necessity of privatising the NHS. ‘Of course’, said my friend about the arguments against privatisation ‘this isn’t going to make much difference. The City want to decouple National Insurance from the welfare state as they don’t want it NI contributions raised’. If that’s correct, and I don’t doubt for a moment it is, then Gorgeous George’s comments about National Insurance are part of his wider plan to privatise the NHS.

It’s also part of a wider plan to abolish welfare benefits. At the moment, state pensions are still provided through NI contributions. If Gideon abolished this for 18 to 21 year olds, as one of Mike’s commenters has pointed out, then it means that they either have to take out a private pension plan or take out a workplace pension. It also means that they will have to work for another three years longer than those a few years older, who were luck enough not to be caught out by Gideon’s reform.

None of this was really picked up on at the time, though the Beeb did cover some of Labour’s criticisms of the Chancellor’s speech. I wonder if more trenchant criticism of Osborne’s comments on the economy on the BBC may have been hindered by the Conservative bias of the Beeb’s news team themselves, and an attack on the BBC as a state industry in the Tory magazine press. This week’s edition of Standpoint, which was launched as a Right-wing rival to Prospect, carried an article by Toby Young declaring ‘Now is the Time to Privatise the BBC. In a recent interview with Andrew Marr, Greg Dyke shrugged off Tory allegations of left-wing BBC bias as something that you could expect them to do, when faced with something they disagreed with. Every government, whether Left or Right, has believed that the BBC was biased against them. Nevertheless, with the Tories explicitly demanding the cessation of the BBC as a state broadcaster, it’s to be expected that any further criticism of the Conservatives in the next few weeks may be somewhat more muted than usual.

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One Response to “Osborne’s Attack on National Insurance as Jobs Tax and the Privatisation of the NHS”

  1. golden Inova Says:

    I couldn’t refrain from commenting. Perfectly

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