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IAIN WATSON: This fine Victorian vessel
pioneered passenger trips to the other side of the world back in the days
when the Liberals used to form governments. Now, just imagine what might
happen if their modern day equivalents, the Liberal Democrats, ever got
their hands on the helm of the ship of state. This isn't entirely a fantastic
voyage; they're already in coalition in Scotland and Wales. And, they
say, if they reach power at Westminster, we would enter a new era of openness
and fairness in taxation.
BARONESS WILLIAMS OF CROSBY: You have to be absolutely frank with
the public, and the public is showing most encouraging signs of being willing
to pay tax for what it believes in, even if you're completely open, and
say, it's going to mean more money.
ANDREW SMITH MP: Theirs is really a 'wish list'
approach to politics. It's a menu without prices, their sums don't add
up, there's a list of undeliverable spending commitments as long as your
arm.
WATSON: Think of one policy that
you associate with the Liberal Democrats - and it's probably their commitment
to put a penny on the basic rate of income tax to improve education. It
stands as a proud symbol of the Liberal Democrats' honest dealing, their
willingness to tell us that improvements in public services really do come
at a price. But voters would be well advised to read the small print.
Up until now at least, they've said the penny will imposed 'if necessary.'
But perhaps that should be translated as 'if we don't think we have got
any hope of winning an election' - because recent events here in Bristol
cast doubt as to whether the Liberal Democrats really do have the courage
of their convictions.
The new 'At Bristol' science exhibition is living proof that exciting
experiments don't always go to plan. The city's labour council felt the
full force of public disapproval when, in a pioneering referendum, fifty-four
per cent voted for no increase in council tax. This, despite dire warnings,
that children would find it tough going; a large share of proposed cuts
would fall on the education budget unless voters opted to pay more.
It's not that surprising to find people don't like paying tax, but this
woman's attitude has fascinated political observers. As the leader of
the local Liberal Democrats, she too voted against the council tax going
up.
CLLR BARBARA JANKE: We as responsible councillors
cannot ignore the representations that are made to us every year from the
citizens of this city saying that they pay too high council tax, they don't
get good value for money and they want something done about it.
WATSON: The Liberal Democrats say
their stance has to be weighed against the fact that public confidence
in the Labour council has drained away and in any case, cash from the sale
of the municipal airport could fend off the education cuts. But Labour,
with a weak, two-seat majority, say the Libdems are motivated by opportunism
ahead of May's council elections - their proposal to stave off cuts is
taking the mickey.
CLLR GEORGE MICKLEWRIGHT; Where the money comes from, nobody knows,
it's some sort of pile of magic money which only they have access to, and
that's what they propose every year, and it's totally cynical trying to
suggest to people that they have it both ways, no increase in taxation
but additional spending. And while in some respects that is possible in
the very short term in fact you soon run out of money and you're faced
with an even bigger council tax than you would have done before.
WATSON: Leading lights in the local
Conservative party are meeting to discuss their alternative budget for
Bristol. The venue is the Clandoger Trow, a dockside pub that's inspired
some pretty tall tales in its time.
ACTUALITY
WATSON: Local legend has it that
Robert Louis Stevenson wrote Treasure Island here, but the Tories say it's
the Libdems who spin far-fetched yarns these days; their credibility has
taken a knock and voters should be suspicious.
CLLR PETER ABRAHAM: They try to be all things to
all men. But I think the time is coming where the public are beginning
to say, hang on, does the figures really add up? And I think we've got
a job, in the Conservative Party here, and nationally, of showing very
precisely that their figures just don't add up.
WATSON: The Liberal Democrats'
opponents say all their talk of transparency in taxation is nothing short
of fiction. Both Labour and the Tories say the Liberal Democrats evade
difficult decisions, not just locally here in Bristol, but nationally.
On the surface, everything appears to be clear. They've told us which
taxes they'll raise and how the money will be spent. But critics say they
are really trying to smuggle through spending plans which don't stand up
to close scrutiny.
RICHARD OTTAWAY: One 'p' costs the taxpayer roundabout
two point eight, two point nine billion pounds in five years time. They
say that one 'p' is going to be spent on education, but if you just run
through the lists of all their education policies, higher starting salaries
for teachers; teachers pay increase of six to ten per cent a year; all
teacher trainees to be paid; more classroom assistants in primary schools;
abolition of university tuition fees; cut class sizes in primary schools;
give teachers the right to non-contact time; nursery education for all
three year olds. If you cost all that lot, it comes to six point four
billion pounds, which is nearly 3p.
WATSON: Apart from education, the
Liberal Democrats are planning spending increases in other public services,
but what's fact and what's fantasy?
The Liberal Democrats have ambitious plans to modernise the health service
by the end of the next parliament. Their spending plans would mean: free
personal care for the elderly in residential homes; free eye and dental
checks; and more hospital staff and beds. But they say most of this -
two point four billion pounds in fact - will be paid for by reducing the
growth in the drugs bill. But that kind of decision may have unwelcome
side effects.
CARL EMMERSON: If we pay drug companies
less for drugs now they may decide to research less drugs for the future.
So this would have a cost in terms of what drugs get developed to cure
which diseases in future. Secondly, the drug companies employ a lot of
people and carry out a lot of research in the UK. If they get rewarded
less for that work here, they may decide to go overseas.
WATSON: The Liberal Democrats have
bountiful increases in store, for some, in their spending plans for social
security: Pensioners would get extra cash as a direct result of taxing
those who earn more than one-hundred-thousand pounds a year at fifty per
cent, rather than forty per cent currently. But the Libdems also expect
to save four-hundred and sixteen million a year, by the end of the next
parliament, by reducing social security fraud - but does this treasure
trove of cash really exist, or is it akin to the unending search for the
holy grail?
EMMERSON: You shouldn't start cutting
taxes or increasing spending on the back of those savings until you have
delivered them, and it's important to remember that the current government,
and previous governments have tried to reduce spending on fraud, and perhaps
found it much harder to deliver than what they anticipated.
WATSON: In addition to the Liberal
Democrats' hard and fast spending commitments, they also have a whole host
of aspirations. These include a full housing and benefits package for
asylum seekers. They'd also like to increase the amount of overseas aid
to point seven per cent of GDP, over the next ten years, and they want
to reduce the ten 'p' lower rate of tax to zero to help the poorest paid.
WILLIAMS: In this country, the
gap between the top twenty per cent, and the bottom twenty per cent, is
steadily widening. That's not good for society. So yes, we've already
said that when we have the money, and we've already made it clear that
our first priority is education and pensions, we would go for an abolition
of the rate of taxation at the bottom end.
EMMERSON: Clearly to cut the ten pence
rate to zero would actually cost money. It's going to cost them around
four billion pounds if they want to do that.
WATSON: The Liberal Democrats have
high aspirations but the question is, are they radical enough to deliver
them in a decent timescale? Certainly they are the only party sticking
their neck out and calling for an increase in income tax rates, but critics
say, if they were being totally honest with us, they'd tell us these are
only a first step - sooner or later, they'd be back for more - especially
if they want to see sustained improvements in public services.
To the casual observer, the Liberal Democrats proposal to raise around
seven billion pounds from tax rises may seem stunning, but experts say
this isn't as breathtaking as it may appear.
EMMERSON: We can see that the current
government's looking to increase spending, by around seventy billion pounds
between now, and two-thousand-and-three, four, the middle of the next parliament.
So, an additional seven billion pounds on top of that, could make some
difference to public services, but it's certainly not going to be a substantial
one.
WATSON: So Labour are telling people
not to get too excited by the Libdems' promises; if they want too see them
delivered, they'll have to pay a high price.
SMITH: There's no doubt at all
that taxes would go through the roof if the Liberals had their way, as
indeed they are in many local councils, including my own, and with this
list as long as your arm of promises they've made, the pressure would be
there for taxes to go ever higher.
WATSON: In Bristol, the Liberal
Democrats fought shy of a rise in council tax. But if they are bolder
nationally, and argue for tax increases, the Tories say they'll reap an
electoral whirlwind.
OTTAWAY: I think that if the public
realise exactly what was involved in these expenditure plans, the levels
of taxation which the Liberals would take them up to, I think there would
be a backlash. We've seen it in the local government referendums, and
I think we'll see it at a national level.
WATSON: The larger parties say
the Liberal Democrats aren't being open about the true cost of their plans.
The message from Bristol to the Libdems appears to be that tax rises aren't
popular. So, to sell voters the line that they'd have to pay even more
in tax, could leave them marooned in an electoral backwater.
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