50 mistakes in 100 days (6-10)

By Howard Dawber

100 days ago, Britain woke up to a new coalition government. In that time they have already displayed extraordinary economic illiteracy and are beginning to champion a dangerous mix of cruelty and cheerful incompetence, perhaps already worse than any government in living memory.

Here are the numbers six to ten of the top 50 things they have done wrong …. so far…

6. INTRODUCING A CAP ON IMMIGRATION
The coalition says it will now set an annual limit for the number of people coming from outside the EU to live in the UK.

Why is it a bad idea? Let’s take a hypothetical example. Let’s say they set the limit at 20,000 for 2011. Let’s say the limit is reached. The 20,001st person comes up and is, say, a Russian billionnaire who wants to buy a British football club. Are we going to say no? What if it’s Beyonce Knowles who wants to move to the UK? What if it’s a Chinese director of a massive company investing in manufacturing in the North East? Do we say sorry, you are foreign, we don’t want your money? What if Kaka wants to come and play for a British club? Ah, well, say the coalition, there will be exceptions. So the limit is, effectively, only for poor people from outside Europe, and is not really a limit. Meanwhile it has a hugely negative impact on potential foreign inward investment to the UK – after all if it is going to be impossible to bring your key people here, why would you come? We’ll be letting anyone at all in from Romania or Poland but strict limits on the USA, China or Australia. Business Secretary Vince Cable knows this is a bad decision which is why he is opposing it in public. So does London Mayor Boris Johnson who called instead for an amnesty on illegal immigrants during the general election.

7. CANCELLING THE CHILD TRUST FUND
Trailed in the Conservative manifesto, this regressive cut tells you everything you need to know about the ConDem coalition’s attitude. CTFs are a progressive and univeral benefit designed to ensure that every 18 year old has a bit of money put aside to help them get a start in education or work. They encourage saving and parental responsibility. And they are really, really good value for money – £500 from the Government becomes more than £37,000 if parents put away the maximum amount.

Why is it a bad idea? CTFs are popular, progressive and now being copied around the world. A small industry has grown up around them. Cancelling them decreases social mobility, increases levels of student debt and removes a new generation of young entrepreneurs. The really stupid thing is that CTFs would be exactly the sort of policy David Cameron’s Big Society think tanks might come up with themselves.

8. FREEZING CHILD BENEFIT
Another regressive tax change is to freeze Child Benefit as announced in the Budget.

Why is it a bad idea? Child Benefit is one of the few universal benefits which goes directly to the mother. The whole point of the benefit is so parents can afford a bit more food and clothing for their children. Freezing it will have no impact on the wealthy who don’t really need it – it will however have a big impact on the poorest for whom it makes up a much bigger chunk of their income.

8. ABOLISHING THE HEALTH IN PREGNANCY GRANT
In the Budget, George Osborne announced he was cancelling the “Health in Pregnancy” grant.

Why is it a bad idea? Those who have had a child – whatever your income level – know that it is a process with lots of unexpected costs. For an expectant mother, changing your diet, buying equipment for the baby and other costs may be overwhelming. Until now there has been a one off grant of a relatively modest £190 to help. Not any more. Both babies and parents will suffer the consequencies.

10. ABOLISHING THE FUTURE JOBS FUND

The ConDems abolished the Future Jobs Fund (FJF) in their first “efficiency savings” £6bn package of cuts. FJF was a government programme to help get unemployed people back to work. It offered a job, assistance in training and skills and a guided path into other employment.

Why is it a bad idea? The FJF worked – by the end of March 2011 the existing bids will have funded over 100,000 jobs. With unemployment likely to rise as a consequence of the ConDems other policies cutting support to help people back into work like this is huegly short sighted. Abolishing FJF will have a direct impact on the chances of hundreds of thousands of people of getting back into work. The OECD said it was concerned about the impact on unemployment and predicted that the UK’s drive to get people into work would stall after this decision. This is not an “efficiency saving”.

Don’t forget to check back tomorrow to see what’s next on Howard’s list.