Originally Posted by
Alf Young
As it happens, the Institute for Fiscal Studies has just produced a nine-page election briefing on the winners and losers from all Labour's accumulated tax and benefit changes since 1997. It shows that significant redistribution can still be achieved, at precious little extra net cost to the Exchequer, amid all the chancellor's talk of prudence, stability and fiscal responsibility.
According to the IFS, lone parents, pensioners, unemployed couples with children, single-earner households with children and multi-family households with children have all benefited from Gordon Brown's redistributist instincts since 1997, by as much as £48.91 a week. Individuals, whether working or not, couples with no children and two-earner families, even if they have children, have all lost out, by as much as £22.73 a week. As we already suspected, the redistribution has been carefully targeted across the income scale. In Labour's first term, the impact on the wealthiest in society was minimal, while the gains at the other end of the income scale were greatest not for the poorest, but for those in the second and third lowest deciles of the income distribution. Brown's targeting improved significantly in Labour's second term. Households in the bottom three income bands all gained more, while those in the top four bands all lost more.
Overall, from 1997 till today, the bottom two bands saw their household incomes increase by more than 11% on average, while the richest 10th saw their incomes fall by 3.7% on average. But, perversely, the chancellor's redistribution policy was actually much more generous, on average, before the 2001 election than it proved afterwards
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