An Attempt by the Labour Left to Tackle Inequality and Poverty Blocked.

Parliament is debating today the Government's National Insurance Bill, which will set the earnings limits for paying national insurance contributions. Sounds like a dry bureaucratic issue but actually this is a key decision on whether the Government is serious about tackling poverty and inequality in today's Britain.

The National Insurance system which came out of the Beveridge report was a central plank of the Attlee Labour government's welfare state. It established the system whereby national insurance contributions are paid from our individual earnings into the National Insurance fund to pay for retirement pensions, unemployment and sickness and other benefits. It offered us all a basic level of security whatever life threw at us.

In the 1970s to protect the rich an upper limit was placed on the contributions paid by high earners. This was the uppper earnings limit. As a result those on average earnings today pay about 8.6% of their earnings in NI contributions but those earning £100,000 pay only 3.9%.

I wanted to use today's debate in Parliament on the Government's National Insurance Bill to highlight the unfairness of the earnings limit and to gain support for reform of this system. So I tabled a series of amendments to the Bill abolishing the upper earnings limit so that the high earners would pay the same share as everybody else. This would not only be fairer but it would also raise £8.8 billion for the national insurance fund.

This money could be used to increase child benefit by £14 a week, lifting 400,000 children out of poverty. It could be used to make all personal care for the elderly free or increase the basic sate pension or restore the link between pensions and earnings that Labour has been promising for over a decade.

Regrettably the amendments have been rejected for debate so the Government has lost a critical opportunity to address very practically the inequality which disfigures our society.

Last month the Institute for Fiscal Studies reported that in Britain "inequality is at its highest level since the late 1940s." The IFS actually found that "those at the bottom of income distribution and especially the poorest 15% of households saw their income go up at below average rates and in some cases even fall."

Abolishing the NI upper earnings limit which protects the wealthiest in our society could have been a small but significant step in reddressing this inequality. However in Parliament today we will not even get the chance of discussing this proposal. Welcome to Gordon Brown's Britain 2008.

Blogging to Start Again Next Week

Sorry I haven't had time to blog since the start of the New Year.

I have been up to my kneck in various campaigns both in and out of Parliament, not least the attempt to tarmac over a sizeable part of my community with a third runway and sixth terminal at Heathrow. I have also been participating in the setting up of the LRC's regional and branch structures around the country. I have been doing meetings on this and other issues both in my constituency and around the country virtually every other night and at weekends over the last few weeks.

In Parliament we have also been stretched in covering all the issues the Government has been throwing at us ranging from the Euro Treaty legislation to the Sale of Student Loans and Pensions legislation.

In addition I am trying to develop and consolidate much more active and accessible forms of democratic participation in my constituency building on the community conferences and local groups we have set up as part of our concept of community socialism.

Anyway I will be starting to blog again on a regular basis next week.

I see someone was very kindly correcting the punctuation on my blog. The problem I have is that many of the commas and apostrophes etc I insert come up as gobbledeegook when I put them in. I will try and sort this out for all those who are offended by a lack of punctuation!

On the wider political front there is an immense range of activity and campaigning going on so I am keen to get back to blogging just to share information and people's views on these campaigns.

To try make it easier to get ideas across and maybe more accessible for comments I am going to experiment with a bit of film blogging if we can get the technology operating ok.

See you next week.


John

Christmas Realities for Too Many in Our Society.

This is the reality of life for too many of our people after 10 years of New Labour in power.

In the week before Christmas I am in my constituency office dealing with a family who have been told by their private landlord that they must quit their home on Christmas day. Their privately rented home is in a disgraceful state of disrepair but costs them £825 per month. The property is a former council house which has been bought by a buy to let landlord who lives in a wealthy area in the Home Counties. He owns many properties in my constituency. The family dont want to publicise their plight because they are frightened of retaliation by the landlord.With 2000 homeless families in my community I come across obscene exploitation like this is on a daily basis.

It shouldnt be like this after 10 years of a Labour Government. In 2008 we can no longer remain quiet about New Labours grotesque failure of the weakest and most vulnerable in our society. The role of the Left will be to expose more fiercely and campaign even harder against the injustices of our society.

I am signing off for a break with my family over Christmas.

I want to thank all those people who supported me and my various campaigns throughout the last year and all those many many people who inspired me with their determination altruism and courage.

Have a Good Christmas and I wish you all a peaceful and happy New Year.

We wil be back in 2008 determined as ever to work in solidarity with all those who believe like me in the words of our campaigns title that another world is possible.

Best wishes

John

McDonnell MP

Credit Crisis and Economic Downturn Looms but it's Another Good Year for City Bonuses.

The financial press daily report on the mounting credit crisis and every serious economic commentator is predicting a downturn if not yet a full blown crash, but it's another good year for city bonuses. So far the predictions are that over £7.5 billion will be paid out in bonuses over the next few days in the City of London.

Bankers at Goldman Sachs are giving themselves at least £5 million each from a record bonus pool worldwide of £9 billion. They will joined in the bonus bonanza by Barclays Capital,DresdenerKleinwort, Lehman Brothers, UBS and Morgan Stanley.

So the people and institutions who have brought us to the brink of recession are rewarding themselves by becoming even more filthy rich.

The City of London plays a significant role in assisting individuals and companies avoid tax on their income. The IMF has recently described the City of London as an onshore tax haven. Latest estimates put the figure of tax lost by tax avoidance in Britain at £150 million every year. It is estimated that Africa loses £75 billion through tax dodges, five times what it receives in aid.

Today I have tabled an Early Day Motion in Parliament calling on the Prime Minister to introduce measures to tackle this tax avoidance and also to introduce a windfall tax on the city bonuses. Even a small redistribution of the income from these grotesque bonuses would assist in eradicating child poverty in our society.

Will Gordon Brown act to tackle this obscene increase in the wealth of the very rich at a time when many in our society face the insecurities of a possible recession? After ten years of a Labour Government we shouldn't have to ask the question.

Rally for Victimised Unison Members

I have just come back from the rally we organised tonight at the House of Commons for the Unison members who are being victimised for campaigning against privatisation. The rally was really successful.

Speakers from Karen Reissman's campaign explained that Karen, a health worker, has now had her appeal rejected and has now been sacked for speaking out publicly against the privatisation of health services in Manchester. Michael Gavan was also with us. Michael is the Unison branch secretary at Newham council and has also been sacked for organising meetings to protest against the council's privatisation of its services.

The Freemantle care workers also came along and John Freeman, their Unison branch secretary, described the treatment the care workers received at the hands of the Fremantle company after Barnet council had privatised their service and jobs.

It was incredibly moving to listen to these stories of courage and determination in standing up for what people believed was right. We all acknowledged the courage shown by Karen, Michael and the Freemantle workers.

Unison members at the meeting resolved to take the message about these individual disputes and acts of victimisation back into their branches and to use every mechanism available through the union's structures not just to gain support for these individual campaigns but to mobilise to put Unison at the heart of campaigning against privatisation.

Tonight could just be the start of transforming Unison into a fighting union.

Tomorrow NAPO holds its rally in Parliament against cuts in their services and jobs caused by Gordon Brown's comprehensive spending review. At the same time the Police Federation is holding a 1000 strong meeting in protest at the pay settlement imposed on the Police by the government. On Thursday RMT is demonstrating outside City Hall in London against the Mayor's decision to put the East London line and Crossrail out to a franchise and Newham council workers are out on strike in support of Michael Gavan.

Surely the message is fairly clear. People have had enough and are not willing to take it anymore.