People put their faith in the Tories – do NOT let them down now, says STEPHEN POLLARD

0

There wasn’t much detail spelt out in last year’s Conservative manifesto. But one of the few specific commitments was the introduction of 10 “freeports”. This week the Government began the process of setting them up, launching a consultation for areas to bid for the status.

Freeports are a brilliant mechanism for promoting trade and investment. They are areas where no domestic taxes are levied on any goods. Tax is imposed only when something leaves the freeport for the rest of the UK. If it’s exported then no UK tax is paid. 

In addition, the absence of red tape such as the need to fill out customs declarations is a lure for investment, both from within the UK and abroad. 

The building company Mace has calculated that creating these new freeports could create 150,000 new jobs and add £9billion a year to the UK economy. 

Like most good ideas, there is nothing new about them. 

The medieval Cinque Ports of southern England and the northern European Hanseatic League, founded in the 12th century, were forms of freeport. 

And we’ve had them more recently – a batch was created in the 1980s, including in Birmingham, Belfast and Liverpool. 

But they were, wrongly, scrapped in 2012. 

This is exactly the kind of policy that a government with a majority of 80 should be pushing.

Indeed I’d be surprised if Chancellor Sajid Javid and the Prime Minister himself aren’t asking if there are broader lessons to be learnt from the idea of freeports. 

For many town centres in decline, for example, something similar would be a godsend. 

Business rates are destroying the high street, many in those very “red-wall” constituencies won over by the Tories in December. 

The Government should be looking at how to make town centres attractive again to retailers and other investors – which should involve scrapping business rates altogether in some areas which are dying on their feet. 

Which is why some of the speculation that emerged at the weekend is deeply disturbing. 

Instead of building on ideas such as freeports to come up with policies to push growth and prosperity, it seems that the Government is turning for inspiration to Ed Miliband. 

The tenure of the former Labour leader is easily forgotten but one of his cornerstone policies was the so-called “mansion tax” – a tax payment which would be taken from the bank account of anyone who lives in a house worth more than a certain amount. 

Astonishingly, it is said that the Government is toying with a similar smash-and-grab raid. 

There are also rumours that pension tax relief could be halved for anyone on £50,000 a year. 

That would clobber more than four million people – many of them traditional Tory voters. 

The Government would be out of its mind to enter this terrain. 

Mr Miliband was sent packing by voters in 2015 and in December Boris Johnson won a landslide by eviscerating Jeremy Corbyn’s similar “smash the rich” ideas. 

A month from today Mr Javid will present his first Budget. 

It’s not just the first Budget since we left the EU, it’s also the first since the Tories won in December. 

Neither Mr Javid’s nor the Government’s political capital will ever be higher. 

Governments with large majorities have almost all used their first Budget to set the tone. 

So it is vital that Mr Javid shows that he means business in shaping Britain as an open and enterprising magnet for investment, rather than a backward-looking tax monster. 

We already know there will be a commitment to serious infrastructure investment, and a determination to show new Tory voters that they made the right choice. 

But it would be a catastrophic mistake to think that means a rehash of Gordon Brown’s “tax and spend” measures that got us into such trouble and meant George Osborne had to spend his time as chancellor fixing the mess. 

Yes, it’s outrageous that an oligarch in Belgravia can be paying the same council tax – and sometimes less – than a low-income earner in Stepney. 

But that shouldn’t mean penalising everyone who has been successful enough to afford an expensive house. 

It should mean, instead, finding creative ways to reform council tax that don’t penalise the “squeezed middle”. 

We will find out on March 11 whether we are set on the sensible course. 

Despite all the above, the omens are good. 

Yesterday’s freeport launch is a good step in the right direction. 

Now let’s get going – without punishing prudent voters.

Share.

About Author

Leave A Reply