a post by Torsten Bell and Adam Corlett for the Resolution Foundation blog
Raising taxes is never easy. Raising taxes with the government’s slim parliamentary majority is harder still. Raising taxes on wealth in those circumstances, given our diverging senses of fairness is… not a walk in the park. But that doesn’t mean it doesn’t need doing, and the good news is that significant progress can be made despite these constraints.
There are three reasons it is needed. First, one of the biggest challenges facing our country is how to fund the rising cost of public service provision as the population ages. This demographic headwind and wider health cost pressures are set to increase the price tag of the current welfare state by £36 billion a year by 2030, and £84 billion by 2040. Crucially this is the cost of paying for what we’ve already got – not all the extensions to our welfare state, from extra childcare to badly needed social care provision, that are often called for. This isn’t just an issue for the future – managing these cost pressures and demand for new services, against the backdrop of a decade of austerity, will be exactly the challenge the late 2019 Spending Review will have to wrestle with (and changes to the accounting of student loans certainly won’t help the Chancellor).
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