22 April 2015

Reduce Social Security Contributions and Watch the Money Pour In

The typical cost of seeing a GP in Jersey is around £38 per visit
In his letter of 9 April to Jersey Evening Post, Mr John Davis of St Ouen presents a very prejudiced and, ultimately, untrue picture in relation to our Party and its policies.
He starts of by presenting a statement of opinion, his opinion, as if it were a categorical fact: 'It is a truth universally acknowledged that a left-wing politician not in possession of power will 'bribe' the electorate with unfunded spending proposals.' The first question to ask is 'Is it a truth, let alone a universally acknowledged truth?' The second question to ask is: 'why only a left-wing politician?' Why not a right-wing politician, a centrist politician, a green or a nationalist? The answer is, because (1) Mr Davis clearly does not like the politics of the left, or what he perceives to be the politics of the left and he is simply having a go.

Mr Davis needs to be corrected on several counts: Firstly, the idea that people's ability to see a doctor/nurse should be based on their need rather than their ability to pay is not the monopoly of left-wing thinkers or politicians; true, the NHS was conceived of by a Labour government after the second world war, but it is interesting to note that all the parties in the UK election are promising extra funding for it, as they recognise its inherent worth.

During the last election, it was the right of centre candidates who were promising all sorts from 50meter swimming pools to free disabled bus passes. We're these costed? And where are these policies now?

Secondly, the policy that everyone - rich or poor - should have free-at-the-point-of-access - is not an attempt to gain popularity; it is something that we and are members resolutely believe in. In a wealthy island such as Jersey, it is unacceptable that every year people are dying prematurely from curable illnesses because they could not afford to see, or were put off seeing a doctor, due to the high cost.

Thirdly, the idea that this kind of policy would 'sacrifice the economy' is simply scaremongering and false. Late diagnoses are very expensive to treat, compared with ones that are picked up earlier, not to mention the additional suffering for the individual and their family and friends. In such cases, the taxpayer picks up the bill. Conversely, a workforce which is able to see the doctor from time to time, as and when it is needed, will be a healthier and more productive one, ultimately benefiting the economy and community.

He talks of means-testing, but apart from the very poorest and sickest, means testing does not exist.  The multi-millionaire pays the same rate as the single working mum and receives the same subsidy, meanwhile the higher earner pays a lower rate of Social Security above the £47,016 threshold. Means testing is often bureaucratic, costly and a blunt tool. We say, better to have universal benefits - including the State Pension.

But Mr Davis is right in one respect. The public should demand costed policies of all their politicians before they are elected. These should feature in manifestos in the run up to elections, however, they can only work if like-minded candidate work together on common policies, thus forming parties, to give the public real choice. Currently, this does not happen. And this is why in States Assembly after Assembly ends up sleep-walking from one election to the next, never tackling the underlying issues of Health, Housing, Education and Environment - because policy is made up on the hoof after the election, and the public never get to cast a verdict on the finer detail.


Reform Jersey is the only official political party in Jersey. We want Jersey to be a fairer, better palce in which to live and work and as such, we aim to improve the life of working people & fight for the
 interests of the most vulnerable in society.

However, Reform Jersey, prior to the election, did make sure it got the figures it required from the outgoing Social Security Minister so it could start to make costed policies and free up new, fairer, funding streams to fund much needed public service improvements. In September 2014 we asked the Minister to provide projections for income yield if social security contributions were set at 4%, 5% and 6%, respectively, with no Standard Earnings Limit  or Upper Earnings Limit, with employer contributions remaining unchanged? (Currently, a lower employee contribution of 2% is paid between the SEL of £47,016 per year and the UEL of £155,568 per year, with nothing paid above this 'ceiling'.).

The answer showed that, based on 2012 figures, it would be possible to introduce a flat rate of social security contribution at 5% (thus reducing contributions for the vast majority of workers, who currently pay 6%) whilst still increasing the contributions yield by £7.5 million. This, clearly, would be a win/win as it would allow more people (the vast majority) to reduce their contributions, thus putting more money in their pockets (a good right-wing principle - 'because they can spend their own money better than government can'), potentially stimulating the economy, as more people will have more disposable income. Yes, it would mean that the highest earners would start paying the same rate as everyone else and I am quite comfortable with that.

Given that in 2013, the total subsidy given over to GP visits was £8.8m, this additional sum would go a long way to reaching the goal achieving free or near-free GP visits for all.

However, we realise that social security contributions are limited in their scope as they do not capture unearned income. If Jersey is to have a truly more progressive system to fund improved an improved Health Service, we must start looking at making the tax system more progressive, so that those who have the ability to pay more do pay more. We will be looking carefully at the latest figures that have been recently released by the tax office (following an Freedom of Information Request) with a breakdown of earners in different bands.

So Mr Davis can rest assured, that populist or not, our policies will be both costed and based on the greater social good. We only wish the same could be said for the policies of other parties, when the next elections come around.


  1. The social security cap was introduced because government recognised that all of those making social security payments were entitled to equal benefits for their contributions, and thus there was a level at which it was inequitable to expect people to pay ever higher prices for a fixed level of entitlement ?

    If you believe the cap should be removed, do you also believe that the price of a loaf of bread, or a litre of petrol, or parish rates, should be calculated according to one's earnings ? Surely expecting people to pay higher price than others for identical social security benefits is as unfair as charging basic necessities on the same basis ?

  2. Income tax is NOT capped and even lawyers on £300k can only use so much of the services it pays for, likewise soc sec should not be capped.

  3. Income tax is not capped. You are absolutely correct. An interesting observation, but it doesn't answer the question of WHY anybody should pay more for an equal good or service simply because they earn more ?

    So I'll repeat the question. Do you believe I should pay less for a loaf of bread simply because I earn less than you ?