Fairness has left the building

Friday’s so-called ‘mini’ budget has seen the new administration abandon any pretence of being interested in fairness. What next?

PLUS: Sign up here for the Fairness Index online launch event on 19 October.

Will Snell

Chief Executive Fairness Foundation

PS: if you haven’t yet done so, please sign up to get Fair Comment in your inbox every Monday.

Fairwashing, noun - the practice by politicians of invoking the idea or name of fairness to justify or build support for policy changes or proposals that are intrinsically and objectively unfair

Politicians sometimes invoke fairness to justify policies that are patently unfair, like austerity or the watering down of net zero goals. But for Friday’s mini-budget (AKA ’fiscal event’), Kwasi Kwarteng didn’t even bother.

When asked by the BBC if the swingeing tax cuts that he was unveiling were fair, he gave a response that no one could be expected to treat seriously - that he was "being fair" by reducing taxes right across the income bracket. This despite the fact that people earning £1m will save £55,000 a year, almost twice the median salary, while everyone outside the top 2% will see their income taxes rise in real terms over this parliament because of the impact of inflation and the pre-existing freeze on income tax brackets.

This government has abandoned any attempt at redistribution in favour of an ideologically driven focus on growth.

As Tom Peters at Tax Justice UK argues in Tribune magazine, the ‘fringe’ ideas announced on Friday amount to “the largest single transfer of wealth from the many to the few in half a century”, and will have a particularly negative impact on women as well as disproportionately benefiting the wealthy:

Analysis by the Women’s Budget Group shows around 80% of those who benefit from slashing the 45% tax rate will be men. Meanwhile, three quarters of workers who earn too little to pay income tax are women, and so will gain nothing from the nearly £5.3 billion a year spent cutting the basic rate of income tax. It’s hard to think of a more deliberately divisive budget by a British government ever.

Peters also points out that there is vanishingly little public support for this agenda. Research published by the British Social Attitudes survey last week showed that only 6% of the public were in favour of tax cuts, with a majority supporting tax rises to support better public services.

And, as Sam Freedman points out, voters are not keen on the broader policy agenda:

Voters want economic growth in the abstract, but they don’t want a lot of things that might, in theory, help that growth… from removing the planned rises in corporation tax to reducing employment protections and allowing bigger bonuses for bankers. Again the point is not whether these things will help growth – that is disputed – but that even if they did the public would still oppose them. Again the point is not whether these things will help growth – that is disputed – but that even if they did the public would still oppose them.

Public attitudes notwithstanding, the fact that the government has so obviously and unapologetically pivoted away from redistribution poses a challenge to campaigners who are focused on fairness, equality and justice. How to engage with an administration that is not even paying lip service to the issues?

The first priority, perhaps, is to follow the lead of Tony Danker at the CBI, who made the point this weekend that we should challenge the false premise that we have to choose between growth and redistribution. The two things aren’t in opposition; in fact, they are interdependent.

Our new leaders are making a virtue of not listening, and being seen not to listen, to their critics, even if almost everyone from the Institute for Fiscal Studies to large numbers of Tory MPs are lining up to denounce their policy choices. But we can be fairly confident - unfortunately for everyone in the country - that the passage of time will show how disastrous this week’s choices are for the economy and for almost everyone in our society. During this period we must work hard to build support for a coherent vision that does things differently, and that brings together people from across the political spectrum in support of a fairer approach that combines a focus on prosperity (for all) with the broader needs of people and planet.

Next month we’ll be publishing a Fairness Index for the UK, which will set out where we stand at present on our five components of fairness (the Fair Necessities) and what we can do to improve things. Sign up here for the online launch event on 19 October.

The latest British Social Attitudes survey is out. It shows that an increasing proportion of people support increasing taxes to support public services, while the proportion wanting to reduce taxes and spending remains very low. As in previous years, two in three respondents agree that there is one law for the rich and one for the poor. More than two in three agree that wealth is shared unfairly, as high a proportion as there has ever been, while support for redistribution has increased to 49% from 40%, almost a record high.

“Our millionaire members - entrepreneurs, investors, economists, and inheritors - all agree it’s time to tax our wealth. Do it now to make our country richer.” Phil White of the Patriotic Millionaires discusses recent polling showing that 70 percent of respondents - and 64 percent of Conservative voters - believe that very wealthy individuals should be taxed more heavily to help pay for public services and the cost of living crisis.

“Cutting corporation tax has failed to increase the UK’s dire levels of private sector investment. In fact, while we have been engaged in the race to the bottom on business taxation, our relative performance on business investment has been worsening.” George Dibb at IPPR argues that cutting corporation tax is not a magic bullet for increasing investment.

“Research into banking bonuses suggests… a direct relationship between ‘variable executive remuneration’ (performance dependent bonuses) and risk taking.” Alper Kara of the University of Huddersfield writes about why scrapping the bankers bonus cap could hurt the UK economy.

“I do not buy for a minute what might be called “trickle-down democratisation”: the notion that ours will somehow become a fairer, less class-ridden society if we force the Princess Royal to ride a bike round Victoria Memorial or coax Charles into wearing a lounge suit – perhaps without a tie? – when he delivers his first King’s Speech.” Matthew d’Ancona writes for Tortoise about the future of the monarchy, arguing that it is not among the institutions in greatest need of radical reform.

“Too little open dialogue has occurred asking the question ‘just how representative of the ‘public’ polls really are?’.” Siobhan Morris, Professor Ann Phoenix and Dr Olivia Stevenson at University College London write about how representative public opinion polls really are.

“Black people in Britain face considerable discrimination, particularly in public services, due to their ethnicity but remain resilient despite the effects of systemic racism.” The Black Equity Organisation reveals the findings of the biggest ever opinion poll of Black people speaking about their experiences living in Britain.

If you haven’t yet done so, please sign up to be emailed Fair Comment every Monday.

Please suggest anything we should include in (or change about) Fair Comment.

You can read all of the previous editions of Fair Comment on our website.