Midweek meal ticket plan offers no real deal for families hit by Coronavirus
In the last two days since Chancellor Rishi Sunak made his Summer Statement, I was reminded of two things. The first was a children’s television programme which inspired two stunning C64 games. The second one was a more contemporary reference: a radio advert for Confused.com with references to cheap carbonara. In the advert, there is some confusion over cheap car insurance deals or cheap pasta meals.
I shall focus on the latter reference as few people under the age of 30 would have heard of Junior Kickstart. (Unless they have Half Man Half Biscuit’s This Leaden Pall LP where it is mentioned on the final track, Footprints). Kickstart (as in Sunak’s future employment programme) may be dealt with in a separate East of the M60 post.
There was a similar level of confusion over how the Chancellor of the Exchequer would help to kickstart our post COVID-19 economy. On the personal income side, there was rumours of £500 being given to every UK citizen to spend in a shop of their choice. A sort of peoples’ qualitative easing measure; a touch of Keynesian economics for our beleaguered High Street stores.
For less well-off people, a £500 bonus would make a difference to their lives. It could clear a few outstanding debts; it could go towards school uniforms. It could help towards buying a new cooker without having to pay over the odds for one. Most importantly, it could get a month’s shopping sorted out.
Anyone earning less than £15k a year and/or claiming Universal Credit would welcome that windfall. Then again, had the Tories added £500 into their bank accounts, there’s every chance it would have affected their UC entitlement for the month. If in vouchers for a set number of retailers, less so (though they probably would have made it an in-kind benefit as with the occupational COVID-19 tests).
This year’s Summer Statement will be best remembered for one policy. A diners’ discount scheme where everybody gets to pay the tab. You could bet your bottom dollar (other 1980s Tameside discount stores are available) that the average taxpayer will be subsidising some better off diner’s restaurant bill.
Eat Out to Help Out Some Frequent Diners Who Didn’t Need The Discount Anyway
Let’s show up the Government’s Eat Out To Help Out scheme for what it really is: a state sponsored affinity scheme. No different to the kind of affinity scheme that has been available for over fifty years in various forms. In a nutshell, they are taxpayer-funded Luncheon Vouchers for the well-heeled.
Eat Out To Help Out is no different to anything offered by groups like The Gourmet Society or the Hi-Life Dining Club. The premise is similar: people with a membership card get a discount. One could dine for top whack whereas their partner gets a free meal. If they have any sense, they would split the bill and both parties save money in the process.
If you go even further back – to the 1950s – Luncheon Vouchers were introduced as a company perk. Instead of a subsidised canteen, some employers could give workers Luncheon Vouchers. They could be spent in local cafés, sandwich shops, Wimpy Bars, or public houses. Though finding a place that accepts Luncheon Vouchers is as rare as hen’s teeth in Greater Manchester, over 33,000 outlets accept them across the UK.
Unlike Eat Out To Help Out, Luncheon Vouchers are classless. They can go towards a meal deal, and help those who cannot afford to pay £20 a week for lunch, never mind that amount a day.
Whereas Luncheon Vouchers in their present form have been going since 1954, Eat Out To Help Out is a mere gimmick. The scheme will only be effective from next Monday [13 July] till the end of August, and redeemable at participating restaurants on Mondays, Tuesdays and Wednesdays. As for the cost of that gimmick, £500 million.
Yes, £500,000,000. The cost of the Free School Meals scheme which the Tories had to be shamed into making a U-Turn for (thank you, Marcus Rashford) is £125 million. A snip in comparison, but a life-changing one which is the difference between parents choosing whether to eat or heat.
As for the discount, up to £10 off a midweek meal in El Posho’s. Few people outside the M25 motorway pay £20 or more for a bog-standard evening meal. Many more people are likely to cook at home or pay up to a tenner per head for a main meal. In pubs or supermarket cafés as a more everyday option, unlike an occasional Sunday dinner. If they went to ‘Spoons, Tim Martin would be out of pocket.
One other thing about the scheme is you cannot get discounts off alcoholic beverages (which ruins any ‘Spoons Curry/Chicken/Steak Club deals). If your usual dining haunt is one of J.D. Wetherspoon’s pubs, then fret not: VAT will be cut on your food bill. This time from 20% down to 5%. Which is piffling compared with the Well Heeled Diners’ Discount Scheme. Still, Timmy got his VAT discount, which he has lobbied for in his customer magazines.
Better ways of spending half a billion pounds
We can think of better ways of spending half a billion pounds. Firstly, it could go on reinstating the pitiful £10 Christmas Bonus that Universal Credit and Jobseekers’ Allowance claimants had till last year. The same £10 bonus that was quite a pretty penny in 1972 which, adjusted for inflation, is equal to £124.75.
£500m could be spent on 3,976,143 Christmas bonuses at £124.75 per head. For Greater Manchester’s, goodness knows how much it would help our bus services. Even with some spare change for Manchester Piccadilly’s fifteenth and sixteenth platforms. Half a billion could pay for every child’s school dinners. How many councils, facing bankruptcy by the end of next year, need that share of half a billion pounds due to COVID-19 affecting their economies?
Whether in the best of economic times or the worst of economic times, the Government Well Heeled Diners’ Discount Scheme, is a stupid waste of money. The money could have been better spent on raising the living standards of people affected by Coronavirus. You know? Nurses and bus drivers, who have risked their lives whilst providing a public service. Teachers who could be the Tories’ next guinea pigs in their Herd Immunity® scheme. Also elderly people, already isolated by cuts to their bus routes before the pandemic as well as twelve weeks of shielding.
The easiest way to spend that half a billion pounds would be on improving pay and conditions for public sector workers. Also by raising the rate of Universal Credit to that of the State Pension rates. (If you think the State Pension is mean, it is generous compared with UC minus Housing and Child Benefit elements). Benefit sanctions, recently reinstated, should be scrapped completely (why has no-one looked at how DWP sanctions have affected our High Streets?).
At the end of his Summer Statement, Rishi Sunak hinted at tax increases in the Autumn Budget. Previous Conservative governments have shifted taxation from direct to indirect sources, favouring VAT over income tax. Historically, the top rate has fallen under the Tories: from 80% to 60% in 1979 then to 40% in 1988. After a rise to 50% under Gordon Brown’s Labour government, it fell to 45% under George Osborne’s watch as Chancellor.
Having seen the direction of travel under previous Conservative Budgets, expect to see more taxes on our old favourites such as beer, tobacco and petrol, though not on whisky. Maybe another VAT rise or the extension of VAT to zero rated goods. With the tax take being reduced by stagnant wages, higher unemployment and lower consumer spending, this would be a true test of character for the Chancellor.
Oh and by the way, that £500m could pay for a few TV Licences for some of my elderly friends who have reached their 75th birthday. Guess what? They are discontinuing that scheme next month, which ensured that every aged person (75+) could watch Doctors or The Repair Shop without paying £157.50 per annum.
If ever there’s a case of getting one’s priorities wrong for the greater good, The Well-Heeled Diners’ Discount Scheme takes the cake.
S.V., 09 July 2020.