Taxpayer funded bribery

Tweet Yesterday, the Chancellor announced that he was extending the availability of pensioner bonds until a date which is conveniently just after the UK General Election.  I posted on this some weeks ago, drawing attention to the fact that this was, in effect, getting us as taxpayers to pay more to borrow money than was necessary, in order to give a pre-election bribe to the wealthiest pensioners.

It’s not often that I find myself agreeing with a right wing think tank such as the Institute for Economic Affairs, but there’s a first time for everything.  Their comment that “Borrowing more expensively than the government needs to is effectively a direct subsidy to wealthy pensioners from the working-age population” sums up precisely the point which I made previously.

They go on to say "Pensioner bonds have never been anything other than a gimmick that will benefit pensioners at the expense of the taxpayer, and it beggars belief that the government is prolonging such a foolish policy."  Whilst I agree with the first part of that as well, it only beggars belief if considered solely as an economic policy.  It may be rubbish economics, but it’s good politics from a Tory point of view.  Offering a bribe to a particular section of the population to stay loyal to them – and getting the rest of us to pay for it – is clever to say the least.

Cleverer yet, they’ve managed to get the entire compliant UK media to follow their line that they’re ‘selling a good investment’ rather than making a very poor borrowing decision, and put the other parties on the wrong foot – they’re afraid to criticise it for fear of being seen to be attacking those pensioners likely to benefit from it.  What is a bad news story for those of us paying for it is being presented as a good news story for the minority who benefit from it.

There’s plenty of reason for the taxpayer to offer more help to struggling pensioners, but no reason at all to single out the most well-off for the receipt of our largesse.  The Tories are committing blatant taxpayer-funded bribery, and it’s going largely unchallenged.