On Friday I spoke to the St Albans School 6th form before rushing up to the Liberal Democrat spring conference in Birmingham. The school certainly has an interesting range of speakers. The previous week they had Nigel Farage, leader of UKIP. This week they are going to have Esther Rantzen. It is an intriguing progression!
I will confess to some satisfaction that my audience of well over 100 young people was more than twice the number that listened to the UKIP leader – beat that, Esther!
St Albans School pupils have never been shy at voicing opinions – this is the third time in recent years that I have spoken there, and I also used to have fairly regular sessions there in the 1980s when I was a governor.
Questions were thrown at me about the economy, the merits of hung or balanced parliaments, our membership of the European Union of course, tuition fees.
What was most interesting to me was the debate round creating a fairer tax system, and in particular the equalisation of tax relief for pensions. They could not see why their parents (at least most of them I presume) should “pay more”, I said it’s not about paying more, it’s about making it fair between high income earners and the person cleaning the room (or equivalent) after school finishes.
Higher rate tax payers were given 65% of the £28bn granted in pension tax relief in 2008-09, though they make up just 19% of pension savers.
And the very highest earners, the 1% of adults whose income is over £150,000 a year, gained 25% of all pension tax relief, worth an average of £20,000 a year to each of them.
If no tax relief was given to anyone, that would put £28 billion back into public coffers – so we are talking big money here. Of course no-one is suggesting that tax relief should be ended in that way, it’s too important that we encourage people to save for their retirement.
But it seems fair and even-handed to me that Sir Richard Branson and his ilk should get no larger a percentage relief on each pound that he saves for retirement than the person cleaning the school lecture theatre . The same for the rich as for those on modest incomes – just like our proposal to raise both Sir Richard’s and the school cleaner’s basic tax allowance to £10,000. What could be fairer than that?
Anyway I hope I left the St Albans students with something to think about.