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Inside Westminster: Darling stomped on stamp duty



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Published Date: 08 August 2008
POOR Alistair Darling has inadvertently achieved the extraordinary. The Chancellor has helped inspire a smattering of pity for real-estate agents.
Who else could possibly do that, except for politicians whose profession has an even lower approval rating than those other slick salesmen?

The Chancellor's ears are probably burning, and not because he may have been sunning himself in No 10's ro
se garden while he minds the shop for Gordon Brown.

At Westminster, the talk is of yet another fundamental balls-up thanks to a few nods and winks here and there on what could possibly be announced in the autumn Pre-Budget Report.

The Treasury and Mr Darling are being blamed for allowing speculation to grow that the government would offer a house stamp duty "holiday" to kick-start the housing market.

Vague briefings, alongside Mr Darling's refusal to dampen the rumours, culminated in front-page headlines. Before long, the government was receiving acres of coverage on its bid to help hard-pressed buyers get on, or move up, the housing ladder. But reports are beginning to flow of house sales falling through on the back of buyers wanting to wait and see what the policy would be. This has triggered fury among stuck home-sellers.

Another recovery plan appears to have backfired.

It is being pointed out by plotters that the Chancellor has form on dangling announcements so far in advance to test public opinion that by the time a policy is unveiled he is accused of dragging his feet over it.

There is only one concrete fact to be established from the Chancellor's stint at No 10 and the stamp duty debacle: it is almost as difficult to run the country as it is to pre-empt the markets.



The full article contains 299 words and appears in The Scotsman newspaper.
Page 1 of 1

  • Last Updated: 08 August 2008 8:36 AM
  • Source: The Scotsman
  • Location: Edinburgh
 
1

Oldnat,

08/08/2008 00:25:15
Is dithering actually an infectious disease running in the Labour Party?
2

a proud doonhamer,

Dumfries 08/08/2008 00:36:45
If you have no policies, every decision requires to make up one up.... it takes time.

Of course, you could vote for a party that has policies that benefit Scotland and solve the problem.
3

Huntly loon,

Aberdeenshire 08/08/2008 00:52:13
Gordon Brown and Alastair Darling. What can we say? The duff decisions and dithering in decision making - the sale of the gold bullion, the tax credits fiasco, the Northern Rock, the 10% tax rate, now the Stamp Duty.

A problem arises and they can make no quick and sensible decision. The lack of decisiveness is now damaging the economy. Brown was only ever as good as the world economy which ran for 10 years on cheap and and unbacked credit. Now that the train has hit the buffers, they are seen to have no plan to deal with in any present problem.

In the words of Cromwell to the Rump Parliament of 1653, I think there has never been a more apt instruction to New Labour under Gordon Brown - "You have sat too long for any good you have been doing lately ... Depart, I say; and let us have done with you. In the name of God, go!"

4

Oldnat,

08/08/2008 01:08:30
Huntly loon

Even more appropriately Cromwell then said "You are no longer a Parliament, I say you are no Parliament." and turfed out all the MPS from Westminster.
5

Hugo of Garven,

08/08/2008 05:40:31
" . . But reports are beginning to flow of house sales falling through on the back of buyers wanting to wait and see what the policy would be."

Is this a reason or an excuse?

I suspect that in the majority of cases it is an excuse.
6

Pilrig.,

Livingston 08/08/2008 05:46:42
Let's face it, Darling's only in No 11 cos he's a Broon loyalist. Broon's only in No 10 cos he worked the Labour party system. Neither are in Downing Street due to outstanding ability.
7

Phil C,

08/08/2008 07:24:32
#5 Hugo

You're sort of right. There was a twit interviewed on the news last night pulling out of a deal with entry in 3 days time. Not a whit of concern for the seller, just a greedy notion that he might save a few bawbees by waiting. If he's done the deal, he should see it through, come what may, or be severely penalised.

As for Darling- what a tube!
8

Rulesbutnotrulers,

Federation, not separation 08/08/2008 07:38:39
Why not levy the stamp duty on the SELLER instead? Surely SELLERS will be 'happy' to pay the tax if it means the house is sold?
9

,

08/08/2008 07:39:55
Comment Removed By Administrator
Reason:
10

GrahamH,

Edinburgh 08/08/2008 08:05:41
Builders are the new farmers. They have prospered for years, when materials have gone up 10% in 5 years, labour about 20% but new house prices by over 50% it is evident that they have had good times. If builders are struggling it's because they have spent and not invested for a rainy day vast profits and now looking to government for hand outs (elsewhere) and injections like this.
11

FedUpTaxPayer,

Edinburgh 08/08/2008 08:11:48
Just when you think it would be impossible for Labour to get any worse, along comes more dithering and uncertainty, doing just that.

Labour are not up to the job - it's time for them to go.
12

The Former Mr. Angry,

Perth 08/08/2008 08:25:30
Having created the problem in the first place by overarching greed, solicitors, estate agents, banks and builders are all moaning that they need a "kick start" to the housing market.

They need a kick start themselves to realise what damage they've done in terms of runaway credit and artificial inflation of house prices. At one point in a recent negotiation we were told that "nothing less than 33% above the asking price will do". I wonder what they'd be saying now! Something along the lines of "just give something reasonable a go - please".

This stamp duty wheeze is just another in the long line of "policies" where the concept is floated quietly to check out how much poltical benefit there might be in it. It is in fact asking all taxpayers to bail out buyers by reducing tax revenue which then presumably has to come from somewhere else, i.e. you and me. I object to failed polticians and corrupt housing industry people constantly seeking to be bailed out and getting in the trough at the expense of the hard-working in this country. They should take the hit and learn some lessons.
13

gus1940,

Edinburgh 08/08/2008 08:49:13
Who in their right mind would conclude a deal to purchase a house today if there was the prospect of Stamp Duty being suspended tomorrow?

How incompetent can a government get that it takes action (or inaction) which really will bring the housing market crashing to a halt.
14

Alan B,

08/08/2008 09:23:39
The issue round stamp duty is more the irresponsibility of the media. Darling has never said that he would suspend stamp duty. When questioned about what he would do for the economy he said he was looking into certain things and mentioned nothing specifically. The media build up speculation and put the government in a difficult position.

Part of the problem for them is if they say clearly that they will not implement this policy as the obviously do not want to. Then if things get worse with the economy and they do decide to implement this policy they will be hung out to dry.
15

Teamdroid,

08/08/2008 09:49:52
#14 - then rather than be vague, Darling should have aggresively stamped(..) on the stamp duty speculation - a statement along the lines of "there are absolutely no plans to modify stamp duty", plus some ear-bending off the record. The press might have had a go at them for "fibbing", but Darling/Brown's reputation for prudence would have been enhanced. Or they'd have actually started having one, more like.
16

it has always been allan,

08/08/2008 10:03:43
The small business , or the self employed, do not get any consideration, but big business gets help.

Like Northern Rock because it is a political matter.
And who is helping them, the taxpayer without any security, let alone possible profit, all to try and keep some useless, power hungry politicians, in jobs, and on TV.
17

danbob,

08/08/2008 10:06:18
I heard the interview Darling gave on Sunday morning whilst driving up the M6. I cannot understand how anyone could jump to the conclusion that he had muted the idea of suspending stamp duty. It was just a defensive response to a very aggresive interviewer. This is mainly the work of the irresponsible press once more. Do they never stop and think of the damage that may unfold. Darling for his part must now come out and give a definate answer.
18

Alan B,

08/08/2008 10:26:10
#Teamdroid

"a statement along the lines of "there are absolutely no plans to modify stamp duty""

Problem with that is it would effectively rule out modifying stamp duty in the future. To a large extent they probably want to see how thing go over the next few months rather than being bounced into anything.

See #danbob, i heard a clip of the interview on the tv last night and there is no way you could take from what he said as meaning that they were going to change stamp duty.

Having said that, i think brown has in general made a mess of the economy so i am not in the least defending labour and their handling of the economy. Brown allow huge deficits in relatelively good times and now has little room to manouvre when times turn sour. He simply ran a lax and irresponsible fiscal policy after his initial 2 good yrs. He also was responsible for the regulation that allowed a british bank to go bankrupt for the first time in ages. He also oversaw a huge rise in personal credit and did nothing (even encourgaged) house price inflation.

With the tax windfalls he is getting from high oil prices he should be lowering petrol taxation which makes up so much of the price. But becuase he has made a mess of the fiscal position he is limited in the action he can take.
19

It's life but not as we know it,

The Oort Clouds 08/08/2008 11:08:43
Isn't it funny that there are still people who are so stupid they vote Labour?
20

Phil C,

08/08/2008 12:13:37
A statement along the lines of the above discussed "there are absolutely no plans to modify stamp duty at present" should suffice in these circumstances.

I also saw the interview as mentioned above. The problem is that the eejit that is Darling mumbled his way to not giving an answer as usual. It's his job to be clear about things.

But the UK press wrongly portrays any change of direction by government as a crime, every u-turn as some admission of getting it wrong. The French have a saying- 'Only an idiot never changes his mind' - which the press and the government might take on board.

At least here in Scotland we are blessed with a common sense government which tries to adapt to changing circumstances. Alex is not afraid to change his mind and modify priorities. More power to his elbow.

21

Scottish 'N British,

08/08/2008 12:25:53
14

Good points.

It got worse when Lamont tried it.
22

Number 6,

Germany 08/08/2008 13:06:43
#14 If Liebour officials stopped briefing the media on
ever utterance made by the Chancellor then these stories would not see the light of day. Although of course, this could simply be liebour testing the waters of public opinion. When you consider the amount of about turns they are performing, that seems to make sense.
23

Fairfax,

08/08/2008 13:08:03
danbob (17): "I cannot understand how anyone could jump to the conclusion that he had muted the idea of suspending stamp duty."

It's important to understand that more is going on beyond the scenes: strong hints seem to have been given to journalists, almost to test public reaction. Unfortunately this technique has backfired here.
24

Alan B,

08/08/2008 13:16:34
#Fairfax

If it was as you suggest labour behind the seens briefing then that would make it labours fault. Depends whether this was a media generated story or labour dropping hints to the media.

Not sure why they would drop hints though. As a tactic it would seem abit bizzarre. Better to just announce it and be seen as taking decisive action. (if they are to introduce it).

25

Number 6,

Germany 08/08/2008 13:26:52
#24 Alan B , I think the reason they are briefing the media, which is what they are doing according to some MP yesterday (Forget his name), is to see what the public's reaction will be. The fact is, they haven't a clue if this is a good idea or not and don't have the confidence to implement it and take the consequences.

What they do is score policies on a public reaction scale.Too much hostility ? "Quick, deny and denounce"
26

An Greumach Mor,

Scotland 08/08/2008 13:32:13
There are many more factors in the property puzzle than the media are reporting.

Lending margins are very high on residential rates
Buy to let products are unworkable without 40% deposit on most purchases and remortgages are impossible due to changes in criteria causing many to try an off load 1/2 bedroom properties
Lenders are restricting loan to value products to 60% to 75% for 1% margins and upto 2% margins on 90% products meaning first time buyers cannot get deposits to make purchases.

They are still many people wanting/needing to buy the demand is still but the economics of the lending makes them unable to secure lending.

Banks and Builders have been making a fortune for years. I hope they put some aside for the rough times.
27

Alan B,

08/08/2008 13:37:00
#Number 6

By past form you are probably correct. I think they have made some big mistake running the economy see #18.

I was just taking at face value the snippet i saw of the tv interview where Darling said little that could be interpreted as them changing stamp duty.

As such i take your point. I just feel that the media were pushing a policy and because the government were not wanting to rule it out definitely, the whole issue was exploding into a media inspired story.

If we take seriously for a moment running an economy and the issues involved in the current situation, it is difficult for a government to not keep open different policy options as economic events unfold. The media circus means that politics not economics becomes the driving forse.

Part of the particular problem the government have regarding stamp duty is, they have run a lax fiscal policy and therefore tax give aways like this that governments can introduce in downturns are made much harder to justify on economic grounds. Brown already fiddled his golden rules and now it looks like he is going to have to tear it up. The 10p tax mess, meant they introduced another tax give away to buy off a problem of their own making, but further depreciated the fiscal position.
28

Matt there,

Somewhere 08/08/2008 14:38:52
13 gus1940,Edinburgh 08/08/2008 08:49:13

I agree.

Who would?
29

Daveunderwater,

08/08/2008 15:10:27
Them that has aye gets mair...
30

Banana Heid,

Ardrossan 08/08/2008 15:44:13
#29 The French had the right idea when they stormed the Bastille and chopped the head off the rich aristocratic leeches. Instead we bend over and take it right up the rectum without so much as a squeak...
31

jacquesmac,

08/08/2008 16:36:12
Bring on the Tomberau and that wee wummin wae her knittin

Slidddddddddddd
THUUUUUUUUUUUmp
SLUUUUUUUUUURP!

Hooooooooooooooorrrraaaaaaaa!
32

Nikostratos,

08/08/2008 17:05:48
#25

yes! that's what the snp do all the time..blam..blam..blam..ak47
33

brownlie,

08/08/2008 17:08:00
30 Banana head

I find your view that "aristocrats" such as Lord Foulkes should face the guillotine horribly extreme, but somehow, strangely appealing.
34

mr angry,

ayrshire 08/08/2008 17:13:48
#32 will you ever post something relevant , rather than puerile childish rubbish
35

A Friend of Fernando Poo,

08/08/2008 17:41:28
An Greumach reckons:

"They are still many people wanting/needing to buy the demand is still but the economics of the lending makes them unable to secure lending."

I've been saying for years that this was the great flaw in the "demand exceeds supply" argument.

Wanting a house without the money with which to buy it is simply wishful thinking and not "demand" as economists understand it. It's been on the cards for years that the denouement to the credit bubble would be for credit to gradually vanish until what Kindleberger called "revulsion" where credit is neither sought nor given.



36

Fairfax,

08/08/2008 17:45:53
Alan B (24): "Not sure why they would drop hints though. As a tactic it would seem abit bizzarre."

It's certainly bizarre in this particular case. However, the release of information via hints to journalists has become the norm since at least the mid-1990s. Here, it's astonishing incompetence.
37

A Friend of Fernando Poo,

08/08/2008 17:48:34
One wag in the Times reckons Darling to be Machiavellian.

The idea is that he floats the idea of suspending stamp duty. This appears to be trying to help people, while actually crashing the housing markets yet more.

Darling and Brown figure that the quicker house prices crash, the faster they'll start rising again, hopefully before the election.

The only flaw is that doubt Darling is smart enough to think of this.
38

Fairfax,

08/08/2008 17:50:19
An Greumach Mor (26): "There are many more factors in the property puzzle than the media are reporting.

Lending margins are very high on residential rates"

To be fair, the financial press is reporting this. After all, there is no surprise in any of the events you describe: easy credit has disappeared, so deposits required increase, as so margins. Given the rapid decrease in house prices, providing buy-to-let mortgages becomes a far riskier business, hence the larger deposits needed.
39

karinxxx,

08/08/2008 20:15:58
32 seeing as we are discussing councillors how about the former tory councillor who kept his internet lover prisoner with an air gun and threatened her with violence.

http://www.telegraph.co.uk/news/uknews/2524557/Former-Tory-councillor-tried-to-keep-internet-lover-prisoner.html
40

Fairfax,

08/08/2008 20:22:02
karinxxx (39): "how about the former tory councillor who kept his internet lover prisoner with an air gun and threatened her with violence."

But think of the saving if violent coercion replaced nepotism in Parliament: we could reduce public expenditure by some £20 million per year for the cost of some 600 airguns. Much better value than PFI ...
41

Nikostratos,

08/08/2008 21:28:15
#39 Karin

what jealous eh.........this u by the way

http://thumbs1.ebaystatic.com/pict/1301954253218080_1.jpg
42

connaughtboy,

stonehaven 09/08/2008 17:21:43
This is all down to Brown. He is, to all intents and purposes, still the Chancellor of the Exchequer. It has his dithering tendencies stamped (no pun there!) all over it.

 

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