Sunday, 1 April 2012

The budget and how Westminster politics fails Cornwall

I have been eagerly awaiting some good news for Cornwall to emerge from Osborne's budget but alas nothing but misery for us. The headlines from the Conservative and Liberal Democrat plan are a tax break for the richest in society, firstly the so called '50p tax rate' has been lowered so those earning over £150,000 will pay less tax and corporation tax has been lowered 2%. In effect this means billions will be lost in revenue to the Treasury from some of the richest in society not just millionaires but huge companies. Certainly the 2% tax cut for corporations is great news for the likes of Tesco and Morrison's, saving them an astronomical amount of money. The rise in the personal allowance must be welcomed and is the only good thing from the budget, but I doubt the extra £630 will negate the regressive VAT rate of 20%. Cutting the VAT rate back to 17.5% or even lower would have been a much fairer tax cut putting money back into the pockets of not only corporations and millionaires and billionaires but ordinary people too. It would also have reduced the (overly taxed) price of fuel which really inhibits growth in Cornwall due to the dispersed nature of our population and due to our distance from the centralised supply chain.

In terms of specifically effecting Cornwall, pasty tax has raised the most attention and blood pressure, (see my blog about that here). This will not only hit the pockets of ordinary workers out for dinner but also scores of small and medium size businesses who will inevitably see a drop in profit with the inevitable price hike. The introduction of linking civil service pay with localised pay conditions, in plain English depressing wages in places like Cornwall, will also take millions out of the Cornish economy. It is measures like this that are paying for taxes to be lowered for the richest people and companies in the UK.

During the budget speech Osborne announced plans to invest in the infrastructure of the rail network in the North of England, I am no expert in this part of the world and I am sure it is great news for them. But I couldn't help but feel that Cornwall had been let down again, previously the government announced plans to invest billions in High Speed 2, cutting rail journeys to and from London. This government is by no means adverse to investing in public transport but seemingly not in Cornwall, where services have being steadily reduced, to stations like Hayle for example. Even the Conservative-Independent Cornwall Council are more than aware that the government (of any colour) cares little for rail here and instead of trying to influence Westminster and Whitehall are instead seeking control of rail (see here).

This example of rail is exactly why the party politics and politicking of Westminster is failing Cornwall. Osborne was clear that in announcing the investment in the North of England he was feeding in to the North/South, Labour/ Conservative dynamic of English politics. That is to say that the Conservatives are seen as a party of the south (more like south east) and Labour the party of the north. This announcement of rail investment in the North of England was a counter point to the much bigger plans for another airport serving the south east. It was also a shot across the bows of Labour accusing the previous administration of neglecting to invest in that area.

This is how English politics plays out, the Conservatives accuse Labour of being inept and vice versa and they try to outdo each other when in government with support and investment in each others heartlands. This is why Cornwall is losing out not only because we are a periphery but because we play little part in the Labour-Tory battle (not now and not under the previous government). This government both yellow and blue wings is more than aware that their policies (pasty tax, regional pay, Devonwall, neglecting to invest in fishing and farming) are unpopular in Cornwall.  But they don't care, if this government is unpopular it's both parties that take a hit in the polls. Despite the best efforts of Mebyon Kernow among others no other party are a real threat to the coalition in terms of past voting patterns. They are complacent because they think that people will not desert them and vote for an alternative. They don't need to wheel out investment plans or shelve plans like Devonwall and the pasty tax because jointly the Conservative and Liberal parties have no fear of being unseated. No doubt come nearer to the next general election they'll both attempt to disown the very policies they voted for and blame the other party. For example this election poster in the recent Truro city by election:

The real need for Cornwall is to break out of the Conservative and Liberal Democrat domination of politics. It's with some inevitability that regular readers will find themselves at the part of my blog where I urge them to join and vote for Mebyon Kernow, but I think I have a point. Being dominated by two parties is not healthy for democracy and besides look where it has got us ....
Picture from This is Cornwall