What is a School of Government for?

The new Lavatnik School of Government at Oxford University now offers an intensive one-year masters degree in public policy (MPP) intended to equip students for a career in public service. While there is clearly a need for professional civil servants and public administrators, there must be a doubt about whether what they need can be taught in twelve months, especially when such careers increasingly involve, at the top of the heap, rotating doors between government service and the private sector. Integrity and commitment to the public good are, in any event, not susceptible to being taught in universities and are not demonstrated by the acquisition of a very expensive masters degree for which the student received no grant from the state or local authority for fees or subsistence. But is that what the Lavatnik School of Government is for?

The School is named after Leonard Lavatnik, Britain’s richest man. His wealth is thought to be some £17 billion, from which his ‘modest’ donation of £75 million to the School was sufficient to give him naming rights. As with many of the mega rich, the origin of his wealth is obscure, but, as he was born in the former USSR in 1957 and emigrated with his family to the USA in 1978, it’s a safe bet that he benefitted from the collapse of the USSR and the plundering of workers’ assets that then ensued. This does not represent much of a role model for future public servants in the UK, but Oxford Colleges, like Tory politicians, are notorious for not looking too hard at the source of their funding. The question remains, however, what is the purpose of the Lavatnik School of Government if not to “equip students for a career in public service”?

An important role for a prestigious School of Government will doubtless be to add to the stock of establishment ‘experts’ who can be wheeled in to justify the status quo. It has, however, another even more grubby purpose.

Professor Jonathan Wolff of this same Blavatnik School of Public Policy, writing in the Guardian today, clearly sees post graduate degrees as a product to be sold internationally. Rejoicing in the fact that in 2014-15 71% of full time masters level students and more than half of PhD students at UK universities come from overseas, he cautions against any possibility that the number of overseas students in UK universities could be capped. Such a cap would simply benefit “our competitors”, by which he means foreign universities. No social function is apparently attached to post-graduate degrees, including the MPP. They simply represent a business opportunity for universities, nothing more.

The Marxist view of the education system is that it’s there to reproduce and legitimate class structure and to meet the needs of employers for staff with the necessary skills, attitudes and conditioning. Post-graduate education is part of this system. Treating universities as businesses competing to flog prestigious degrees to those who can afford to buy them is perfectly consistent with this model.

it’s time to change the system. Education would be a good place to start, and university education should be high on our agenda.

Political Discussion on 15 September

At the branch Meeting on 15 September the political discussion centred on the leadership contest in the Labour Party.

It was agreed that, although Communist Party members were simply observers in the struggle going on inside the Labour Party, and we had no interest in entryism, we were well placed to speak out on what was going on. While the reports to the meeting were essentially second-hand, they drew on excellent contacts across the labour movement and, in many cases, the experience of family and friends who were Labour Party members and members of Momentum.

It was reported that Momentum were advising its members to keep a low profile in the internet and not to refer in public or on the internet to ‘plotters’, ‘coups’, ‘traitors’ or ‘Blairites’ when discussing the election. Fear of being expelled, or at the very least being disenfranchised in the current election, appeared to be widespread amongst Labour Party members. Fortunately, the CP, at this meeting and in the pages of the Morning Star, was not susceptible to such intimidation..

It was reliably reported that Labour Party members were still receiving telephone calls asking whether they had voted yet and, if so, which way. When challenged about the purpose and legitimacy of enquiring about votes already cast in a secret ballot, the callers had, it was reported, hurriedly rung off. The evidence points to these calls coming from the Smith campaign, but how they got hold of names and telephone numbers of Labour Party members was unclear. Breaches of the Data Protection Act could not be discounted.

The attention of the meeting was drawn to the extensive anecdotal reports that Corbyn supporters were being expelled for trivial reasons and to the exclusion of some 130,000 new members because they had joined in the last six months. Doubts were expressed over whether the elements in the Labour Party opposing Corbyn would succeed in expelling enough members to swing the election in favour of Owen Smith. Whether this was so won’t be clear until the Labour Party Leadership Conference on 24 September.

It was noted that, in seeking comments on political developments, the BBC had reverted to those who had participated in the staged and phased mass resignations from the Shadow Cabinet. The self-imposed silence from Hilary Benn and his fellow conspirators had ended. Little surprise was expressed over this development, but it was pointed out that, when the BBC draft Royal Charter was enacted, the likelihood of the BBC  reporting  without bias on political developments would be further reduced.

The most disturbing aspect of the Labour leadership election for many at the meeting was the failure of the challenger, Owen Smith, to confirm that he would respect the result of the election. He had previously stated his refusal to serve in a future shadow cabinet under Corbyn and, in the televised debate with his ‘unelectable’ opponent, he had left the stage after being thoroughly trounced, mumbling about offering Corbyn the non-existent role of ‘president’ of the party. As the Co-op Party had refused to go along with the plotters’ proposal to use it as a vehicle to legitimise a Parliamentary Labour Party in revolt against its elected leader, the meeting was concerned that the Blairite wing of the Labour Party would simply trigger successive leadership elections until they finally win one.

Concluding the meeting, it was proposed that, in response to ideas discussed at the Party Cadre School on 10 September, the Croydon Branch should in future hold public meetings to debate and discuss political developments and analyse them in the light of Marxist theory. It was suggested that this might be done by re-activating and re-branding the classes previously held by the Communist University in South London, but possibly introduced this time by named speakers. This proposal will be investigated by the Branch Committee. Views of members were invited.

 

TUC Congress 2016

Largely ignored by the capitalist press and the BBC, who have again declined to reinstate their live coverage of the event, the annual TUC Congress is taking place this week in Brighton. Despite these efforts to discourage public attention, Congress is particularly significant this year as the government struggles to implement the EU referendum decision and while the Parliamentary Labour Party struggles to sustain its self-appointed role as Tory Lite, contrary to the wishes of its elected (soon to be re-elected?) leader. Fortunately, the CP has no such internal conflicts and, as ever, will be in attendance at Congress, distributing each day Unity, our well received briefing for Congress delegates.

One of the most significant issues facing Congress is reflected in Motion 17 and its amendments, grouped together under the heading Protecting worker and trade union rights in the EU Brexit as Composite 7  The composite resolution calls on unions to ‘oppose any assault on the rights of workers arising from the decision to leave the EU. Our rights as workers continue to be among the most restricted in Europe and any further restrictions through Brexit negotiations would be totally unacceptable. The resolution calls for the trade unions to be recognised as key stakeholders in the Brexit negotiations and for

  • a campaign to ensure that the UK government does not repeal any current rights guaranteed by the EU;
  • the rights of existing EU workers to remain in the UK to be protected; and.
  • the IER Manifesto for Labour Law to be promoted.

The CP welcomes these proposals which we anticipate will be adopted by Congress and thus become official TUC policy. In this event, at the local level we will be asking Croydon TUC to acquire, study and seek to implement the IER Manifesto locally. I will report back on the outcome of this initiative..

A Voluntary Tax

In the CP’s 2014 review of taxation, From Each According To Their Means , little emphasis was placed on hypothecation – the principle under which money raised from a particular tax is used for a pre-specified purpose. This makes sense. The primary purpose of taxation is to finance the totality of government expenditure and, subject to borrowing to invest for the future and the cyclical nature of economic activity under capitalism, budgets do need to balance. When, however, there is an opportunity to raise revenue which can be matched with a clear social need for government expenditure, it makes sense, if only for  presentational purposes, to link the two.

Inheritance Tax is currently a “voluntary” tax, not only for the very wealthy but also for large sections of the upper middle class who also see it as their right to pay as little of it as possible. Estates worth less than £325,000 are exempt and the rate of and 40% thereafter is easily avoidable by employing any half-competent solicitor. The Duke of Westminster’s estate, for example, is said to be worth some £13 billion, but no Inheritance Tax will be paid following his death last month as his property is held in trusts. In consequence, Inheritance Tax yielded a paltry £4.6 billion last year. Yet according to even ONS statistics , wealth in private hands is now worth £11.1 trillion, with more than half owned by the wealthiest 10%. If we assume an average lifespan of 60 years between inheritance and death, this indicates an average effective rate of Inheritance Tax of only 2.5%. In reality this average effective rate is much lower due to the wealthy concealing their wealth and the average interval between inheritance and death being much less than 60 years.

Consider now the government’s current level of support for those in residential care homes. According to Laing & Buisson Care of Older People UK Market Report 2014/15. care home charges last year were on average £29,250 per annum, rising to over £39,300 if nursing care was required.  Charges in the London area are significantly higher. Support from local authorities is available (although increasingly difficult to access due to the austerity squeeze from central government), but the care home resident has, in effect to surrender any capital in excess of £14,250 but less than £23,250 at a rate of £250 for every £1 per week of support and 100% of any capital in excess of £23,250. For a small estate of, say £50,000, this is equivalent to paying Inheritance Tax at 72%.

What is to be done? According to the Dilnot Commission in 2011, there should be a cap of £35,000 on the amount an individual would have to pay for their own care costs during their lifetime. Above that level, the state would pay a standard rate for care, regardless of the individual’s wealth. People would still be liable for costs of accommodation and food in a care home, but this would be capped at £10,000 a year. In addition, the commission called for a big increase in the threshold of savings and assets above which the state offers no help with care costs. The limit should rise from £23,250 to £100,000.

These were modest proposals and failed to go to the heart of the problem. The government nevertheless chose to ignore them. Instead it included a vague manifesto commitment to introduce new rules designed to prevent older people from having to sell their homes when they go into care. This has been deferred until 2020. A lifetime cap on care costs in England of £72,000 was also proposed but deferred after council leaders asked for the allocated funding to be used instead to paper over the on-going crisis in day-to-day social care services.

According to another report from Laing and Buisson, residents (and local authorities) currently pay £14.3 billion per annum in care home fees. This figure is likely to increase due to:

  • pressure on fees from cash-strapped local authorities driving many smaller homes out of business, enabling the rest to put up their fees; and
  •   pressure on care homes to improve the pay of their often badly paid and exploited staff. Even the Tories’ so called living wage will have an effect here.

If, however, we disregard the profits earned by care homes – in a sane world they would be run by local authorities, not profiteers – and estimate that the economic cost of the services currently provided is, say, three times that currently paid, this could be paid for by a tenfold increase in the yield from Inheritance tax. Given the current very low effective rate of 2.5%, this could be achieved by abolishing the trust loophole and ensuring other similar scams are not allowed to flourish. With an average rate of tax of 25%, we could have care homes for all with most people still being better off . With a graduated rate of tax, 90% of people could be better off. For example, on the figures above, a rate of 50% on the top 10% of wealth owners and a zero rate for the rest of us could provide care homes for all.

I don’t claim that the above calculations are anything other than rough estimates. The overall position they reveal is, however, undeniable. There is a solution to the problem of paying for care homes: it’s an Inheritance Tax that is no longer voluntary..