There has been a lot of noise about why Gordon really removed the 10p tax threshold and reduced the 22p one to 20p, most of it revolving around his need to grandstand. This explanation by Phil A of Critical Faculty Dojo is by far the most plausible as it involves our old friend "relative" poverty and what's more he spotted what would happen nearly a year ago:
Before Gordon's last budget there was much rending of clothes and gnashing of teeth over ‘Child Poverty’. New Labour had foolishly promised (though why breaking some promises should bother them more than others is not clear) to halve child poverty in Britain by 2010 - and there was no way they were going to meet that target.
That NuLab, especially TB, love making headline catching promises without having a clue how to deliver is nothing new, but when it comes to children there really is nowhere to hide in the modern world. The problem with this one was that for some reason we only talk about relative poverty:
Now New-labour were presumably too stupid to realise this is effectively impossible when they set this target. But because of the way the formula is calculated ‘Child Poverty’ is defined by a moving set of goalposts. If you were to somehow magically increase the household incomes of all families, every single one, who fall within the definition at midnight on Sunday - and then re run the figures the poverty line would have increased and you would still have children living in ‘poverty’. You can do the sums for yourself if you care to.
I think most people with half a brain cell had worked that one out and bloggers have been ripping in to it for some time.
So now comes the old sleight of hand:
So what has this to do with the abolition of the 10p tax band? Well there is one way of getting a temporary boost to the child poverty figures. It is a matter of percentages. If you take from the really poor who it would take a lot of cash to lift out of actual poverty and give that to those who are not so badly off just below the ‘poverty’ line and only need a little to lift them out, then you can keep the goal posts more-or-less where they are and improve the figures no end. It works especially well if you mostly just take from those poor who have no children.
Gordon may be many things, mendacious, cowardly, traitorous, venal, pick your favourite, but he isn't stupid and I think there is more than a kernel of truth in Phil's next comment:
One suspects it is far from a coincidence that Gordon Brown, knowing he would be judged on New Labour's rash promises on ‘Child Poverty’ decided to do the one thing that could easily improve his figures and might be made to look like a tax cut. Rather like a magician drawing your attention to his right hand whist his left does the real trick.
So it looks suspiciously like just another, albeit particularly dodgy, case of New Labour manipulating figures to pretend to be accomplishing something.
I think I can agree with Phil's analysis and until someone comes up with a better motive then this one works for me.
