Tuesday 27 April 2010

Is Vince reopening the LibDem child benefit argument?

Vince Cable refused to join the Labour and Conservative parties in ruling out the means-testing of child benefit, on Newsnight tonight. Cable emphasised that this did not mean the party would target the benefit, simply that he was ruling nothing out.

But that could reopen a topsy-turvy debate in the party after an earlier rapid leadership u-turn on the issue. Nick Clegg clearly stated as the campaign began that universal child benefit was not in question, when questioned about earlier statements last Autumn where both he and Cable personally favoured means-testing child benefit, a position rejected by the party's frontbench spokesman Steve Webb.


After all, Nick Clegg told Jeremy Paxman on the opening Monday of the campaign:

"We are not putting child benefit into question. I never have and he hasn't either", referring to himself and Cable, and excusing Cable's reference to means-testing child benefit in the Chancellor's debate as a simple vebal slip.

Since this was three days before Cleggmania broke out, nobody except Next Left seemed interested in reporting that the claim that Clegg and Cable had "never" put the benefit into question just wasn't true.

Clegg had told The Guardian as his party conference opened last September that he did want to look at means-testing child benefit: "I find it odd that people on multi-million pay packages from the city get child benefit. That's patently silly and patently unfair", an interview which coincided with Cable proposing, in an Reform pamphlet, that child benefit should be targetted, "by assimilating it into tax credit". He wrote: "It is certainly incongruous to many people that the very rich receive child benefit. The IFS estimates that £5 billion or more could be saved by no longer making child benefit universal ... Such a reform would be easier to make if income tax were cut for standard rate payers. I favour making this reform in principle, but more work needs to be done on how to manage offsetting tax cuts".

But the Clegg-Cable plan was overruled by Steve Webb the day after the Clegg interview, speaking with me at a Fabian/CentreForum fringe in defence of universalism:

“We’ve been able to conduct the review speedily over the last 24 hours – and I am pleased to say that the policy won’t be changing. I read ... we were going to look at ‘middle class child benefit’. I have looked at it – and I have rejected it,”

That seemed comprehensive, and appeared to be confirmed by Clegg's Paxman interview, which had gone as far as to wipe his personal u-turn from the memory banks.

This was tonight's Newsnight:

Kirsty Wark: Can you rule out means testing child benefit in the first Parliament?

Vince Cable: "We can't rule anything out, but we are not arguing for that. We are arguing that we should restrict child tax credit, as opposed to child benefit, should be restricted to people on people on middle and low incomes".

Tory spokesman Phillip Hammond was prepared to give a clear commitment, giving an answer happily rather more in tune with the Fabian Society than the think-tank Reform, which has been leading a push to cut "middle-class benefits"

Phillip Hammond: We have made a decision to rule out means testing child benefit because it is a universal benefit. Talking to people, one of the things they appreciate about child benefit that it is universal and easily understood. To start to means test it would erode it ... It reassures them about the availability of the benefit. If you start means testing it, if you start slicing away at that universality, then people are going to ask where you are going to stop".

With which Liam Byrne fully agreed, ruling out the means-testing of child benefit under Labour.

Cable reiterated that his position remained open, but that this did not mean that he was not committed to means-testing, but that it was a question the party would keep open.

Wark: There you have an answer from the Conservatives and Labour at least on child benefit.

Cable: We are not arguing for means testing child benefit.

Wark: You are not arguing for it but you are not ruling it out.

Cable: Of course not. I am trying to be honest and saying we have a serious problem and we are going to look at everything.

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