Windfall Tax
I read a recent news story which claimed that one in four people in the UK have skipped meals, gone without food to feed their family - or relied on family or friends to provide food over the past year.
The research was conducted by the Trussell Trust (a food charity), Fair Share (a food distribution organisation) and Tesco - and says that 40 per cent of households across the UK have seen their financial situation worsen over the last year.
But this is hardly news and it has nothing directly to do with skipping meals or putting food on the table, of course
The report goes on to claim that just over a quarter of those surveyed (i.e. 25% of 40%) say that they have struggled to buy the same amount of healthy and nutritious food as they did a year ago - which is a convoluted way of saying 10% of the survey sample.
And the survey also claims that almost two thirds (i.e. 66% of 40%) say that they will cut back on heating in an effort to boost their food for their budget - around 25% of the survey sample.
Now like all surveys, these figures need to be treated with a degree of caution, but there is no doubt that poorer families, for example those who rent, have less money to spend these days than their neighbours with a mortgage.
Because the housing costs of people with a mortgage have fallen considerably in the past five years due to artificially low interests rates - putting more disposable income into the pockets of this particular group.
So why not have a windfall tax on mortgage, as I've suggested on the blog site previously - levied on mortgage providers and opposed on to borrowers - and use the funds to help the less well off, particularly the low paid?
If there's a better and fairer way is to raise money in these straitened times - I've yet to hear what it is and my suggestion is certainly better than a temporary freeze in energy prices which would affect everyone - rich or poor.
In other words, instead of banging on about the 'squeezed middle' all the time - why don't our politicians admit that the less well off, particularly people in low paid jobs, have been hit a great deal harder.
£20 Billion Windfall (5 January 2012)
Presumably it does what it says on the tin - seeks to speak up for families with children - because the FPI claims that average income of households with children will drop between 2011 and 2016.
By 4.2% would you believe or around £1,250 a year - depending on the exact income of the household in question.
But I say - so what - what does that have to do with the price of mince?
Because unless you factor in other things - such as how much some households have benefited from our artificially low mortgage rates - then the FPI's claim is completely meaningless.
I know some folks - some with others without children - who are saving hundreds of pounds every month necause of low interest rates - worth many thosuands of pounds a year.
So spare me all this special pleading from special interest groups - as ever they are concerned with their own narrow agenda - and have no time for the big picture.
And the big picture means big savings - not for everyone - but for those paying mortage interest when rates dropped like a stone - and the bigger the mortage the bigger some people's windfall.
Here's what I had to say on the issue in 2011 - no doubt the £20 billion figure now needs to be revised - in an upwards direction.
'All in this together' (September 15th 2011)
When people start urging us to take the view that 'we are all in this together' - it's time to stop and think.
Who's 'we'? - will do for a start.
The fact is that not everyone in the UK has been doing badly in these hard economic times - in fact people who are in a secure job and who have been paying a mortgage off - are doing very nicely thank you very much!
Compared to lots of other people anyway.
And just to demonstrate this point here's something I wrote back in March 2011 - arguing for a 'windfall tax' on the £20 billion that mortgage payers have saved in recent years - as a resul tof artificially low interest rates.
Now the people who are not part of this £20 billion windfall are - typically - the less well off and those on fixed incomes who rely on their savings - which produce little or no interest these days - to help pay the bills.
So why don't we hear any of this at the TUC conference - where delegates are good at telling everyone else what to do - but seldom come up with practical ideas for resolving problems.
A special windfall tax would recoup just some of the £20 billion that mortage payers have gained - simply through sheer luck - and it would seem to embrace the 'were all in this together approach'.
Which the present government and the trade unions both espouse - when it suits their own argument of course.
I imagine most union leaders are paying mortgages - because most live in private housing - and most will have benefited hugely out of the artifically low interest rates - we have witnessed in recent times.
Ironically the one union leader who would escape a special 'windfall tax' on mortgages - would be Bob Crow - who has been living in subsidised social housing in London for years.
But a windfall tax on mortgages would be redistribute income between the 'haves' and 'have nots'.
A windfall tax would be progressive because it would tax 'unearned income' - and would be likely to affect the majority of delegates this year's TUC.
In other words - a real life demonstration of solidarity - that we really are 'all in this together'.
Windfall Tax On Mortgages (March 4th 2011)
I read a remarkable statistic the other day - which made me stop and think.
The Financial Services Authority (FSA) has apparently calculated that the UK's artifically low interest rates in recent years - have meant an unexpected windfall of £20 billion to the nation's mortgage payers.
Yet another example of the old saying - 'It's an ill wind that blows nobody any good'.
In this case £20 billion to the good - and the bigger the mortgage - the bigger the killing people have made - without any effort or risk.
While those who can't afford or no longer need a mortgage (e.g. low paid workers and pensioners) - have lost out big time, comparatively speaking.
So I have a suggestion for the government and our policy makers.
Bring in a special windfall tax on mortgages which claws back some of this £20 billion - and use the money to reintroduce the 10p tax rate to help the low paid.
Low paid workers will spend the money - because they don't have a lot to start with - and that will help to boost the economy.
Readers will remember that the 10p tax rate was abolished by the 'man with a moral compass' - Gordon Brown - in one of his worst decisions as Prime Minister.
But here's a chance to right a great wrong - help the lower paid - boost our flagging economy - and with money that has simply fallen into people's laps by sheer luck - nothing else.
