We should be a lot angrier about the antics of people like Gary Barlow than about purported benefit fraud.
We should be a lot angrier about the antics of people like Gary Barlow than about purported benefit fraud
Imagine the reaction if someone had committed benefit fraud on the scale of former Take That star Gary Barlow’s purported tax avoidance? There would be near universal outrage. The Telegraph would be up in arms and the Mail would probably brand it a ‘shocking indictment of the welfare state’.
It’s true of course that benefit fraud is illegal whereas tax avoidance is technically not; but both ultimately result in there being less money available for the Exchequer to spend on things like schools and hospitals. And that means we all suffer as a result.
Indeed, the really striking thing about the Gary Barlow case – Barlow faces having to pay back millions of pounds in tax after a court ruled a partnership in which he invested was a tax avoidance scheme – is the double standard: David Cameron has rejected calls for the former Take That singer to lose the OBE he was awarded by the Queen in 2012; yet were we discussing benefit fraud the debate would likely be over how long the individual ought to spend in jail.
The level of hypocrisy is worse when we consider just how much revenue is lost as a result of tax avoidance and compare it with that lost to benefit fraud.
Benefit fraud is certainly something that everyone should oppose; but it’s a drop in the ocean compared to the money lost by the government to tax avoidance. Department for Work and Pensions (DWP) figures from May 2013 found that just 0.7 per cent, or £1.2bn, of total benefit expenditure was overpaid due to fraud. This compares with £5bn a year that is lost through tax avoidance.
Corporate tax avoidance costs the exchequer even more, with an estimated £12 billion lost. In practical terms, this is money that could pay for 25,000 nurses on a £24,000 a year salary for 20 years. Alternatively, it could put 129,000 children through school or allow the government to give every pensioner an extra £65 a year.
Again, everyone should be angry about benefit fraud, but some perspective is clearly required: we should be a lot angrier about the antics of people like Gary Barlow, however famous they are.
The relentless media narrative which paints a picture of rampant benefit fraud is fostering huge public misconceptions about the welfare state. Polling carried out by the TUC in January last year found that on average people thought that 27 per cent of the welfare budget was claimed fraudulently. As already mentioned, the real figure is just 0.7 per cent.
Should Gary Barlow lose his OBE? You would think so. Yet the fact we are even asking such a question when someone may have willfully denied the treasury millions of pounds demonstrates just how far we are from have a sensible tax and spending debate.
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