This pensioner isn’t giving his benefits back

My income has always been fully declared, but now the perks are about to come my way, I'm expected to renounce them?


Iain Duncan Smith, the Secretary of State for Work and Pensions, wishes people who have passed the retirement age and who can well afford to pay for their own heating bills, bus passes and television licences to return to the state the subsidies they receive.

The winter fuel allowance is worth £200. There are no charges for prescriptions. Free travel in London where I live is valuable.

I am one of the fortunate pensioners to whom the minister is referring. I still do three paid jobs. But I am not inclined to follow Mr Duncan Smith’s advice, or, at least not in the way in which he puts it. Later, I will try to describe a formulation that might speak to me more persuasively. But why not do just as the Secretary of State proposes and write out a cheque to HM Treasury? I could afford to do so.

I have two objections. The lesser one is this. I have now been working non-stop for 50 years and thus paying tax for 50 years. My income has always been fully declared. No dodges. And yet when you finally get to the point when some nice perks come your way, you are asked to renounce them! No, thanks.

Actually, how much tax have I paid in 50 years? It is probably a bit more than £1m, a colossal amount. Here is how I arrive at that figure. In 2010-11, the Treasury paid out £692bn in public spending. This adds up to a contribution of £22,000 from each household, according to the Institute for Fiscal Studies. Which all comes from taxation of one kind or another. That is £1.1m over 50 years in today’s money. Or we can turn to the calculations made by the “The TaxPayers’ Alliance”. This lobby group calculates that, over a lifetime, an average household will pay £656,000 in direct and indirect taxes. But if I assume that I have been for the most part in the top 20 per cent of earnings, then the total paid to the Exchequer rises to £1.3m. So let’s call it something above £1m.

But my big objection to the Secretary of State’s proposal is not so much that I have paid a lot already. My difficulty is summed up in one new word, omnishambles. I cannot send off cheques to the very people, ministers and civil servants alike, who are so bad at their jobs that we have had to invent a word to describe their failings. “Omnishambles” is a brilliant yoking together of Latin and Anglo-Saxon. And by going back to the separate meanings of these two words, you find that it describes all-embracing devastation and disorder.

That is a bit strong, but it is not far off. There are so many examples of mismanagement. Let us start with the austerity policy itself, which even the Government now admits contained one big error – state spending on infrastructure projects was drastically cut back. Recently, Nick Clegg, the Deputy Prime Minister, admitted: “If I’m going to be sort of self-critical, there was this reduction in capital spending when we came into the Coalition government… But I think we’ve all realised that you actually need, in order to foster a recovery, to try and mobilise as much public and private capital into infrastructure as possible… more capital investment would create jobs and help the economy in the long run.” I think that every reader of this newspaper could have told Mr Clegg that. But even so, earlier this week the Parliamentary Public Accounts Committee chastised the Treasury for still not having “a properly targeted and prioritised infrastructure plan”.

Do you remember the sudden promise by David Cameron, the Prime Minister, that the Government will be legislating “so that energy companies have to give the lowest tariff to their customers”. Nobody was consulted beforehand. Even the Department of Energy and Climate Change, the responsible department, was taken by surprise. And what is the situation six months later? The energy companies have revised their tariffs but the danger of being bamboozled by an array of different rates remains as great as it ever was.

I give one more example. It was announced last month that some of Britain’s enterprise zones have yet to create a single job. The Government said that the 24 zones, launched in 2011, would generate 30,000 jobs by 2015. However, to date, they have provided just over 1,700.

So while I couldn’t write out a cheque to a chaotic and inefficient government, Mr Duncan Smith could persuade me to pay over to good causes the state handouts that I don’t really need, say to registered charities that are engaged in helping people deal with the recession. At the last count by the Charity Commission, more than 100 new charities have been registered to deal with vocational education and training, with helping the re-integration into society of people who are homeless, unemployed or in financial difficulty, and with providing food banks.

The Secretary of State could slip a leaflet into the regular communications that his Department has with pensioners that, having taken the advice of the Charity Commission, simply listed charities that addressed the consequences of poverty in all its forms. And invite pensioners who are still working to consider giving extra support to these causes over and above the charitable payments that in many cases they are already making. I would do that.

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