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JEFF PRESTRIDGE: Osborne, scrap these two vote losers

George Osborne has much soul-searching ahead of him in  the run-up to his  Autumn Statement on December 5.

Hopefully, the Chancellor will have the strength of character to execute U-turns on two policies that as they stand are set to  alienate more than 1.5 million people (many of them natural Tory voters) from the Conservative Party.

The first is the new tax on children, designed to claw back benefit for those with an income  of £50,000 or more.

I’ve said it many times before,  but I will repeat myself in case the message hasn’t quite got through  to Number 11.

The tax is wrong, on two levels. First, it is wickedly unfair, hitting households where one parent earns above £50,000 while ignoring those where the overall household  income tops £50,000 but where no individual earner is earning more than that sum to trigger the tax.

Second, it is a crass, clumsy and ill-thought attempt to save money that will cause headaches for thousands of households as they grapple for the first time with the labyrinthine self-assessment tax regime.

It is a bureaucrat’s dream (spawning yet more needless public sector workers) and I am sure that my colleague Tony Hetherington, Financial Mail’s Readers’ Champion, will always have employment dealing with the  flood of complaints against the Revenue & Customs that will inevitably ensue.

  More... George Osborne on track as borrowing is slashed by £7bn 'I've been forced back to work to make ends meet': Opposition grows to the rule that wrecks retirement

Surely there is a fairer, more transparent way of reforming  child benefit?

The other issue that Osborne has to sort out is the pension income drawdown shambles.

As we report today, the restrictions brought in by the Government on income drawdown are far too harsh.

Frankly, it is an insult to individuals who have saved long and hard for their retirement that they are now suddenly being told they are not responsible enough  to ensure their pension lasts them a lifetime, and that they must  take an income cut of more than 50 per cent.

These people – primarily entrepreneurs who answered Margaret Thatcher’s clarion call in the Eighties and set up businesses, helping to drag the country out of recession – are proud that they have built up  the financial means to live an independent retirement.

They would rather walk over  hot coals than turn to the State for handouts. They should be trusted to look after their pensions  rather than be treated like miscreant children.

If you are in any doubt as to  the utter madness of the changes to income drawdown, answer yourself this question. What use is it to a 76-year-old to be told that as a result of the enforced reduction in his drawdown income his pension will now last him until  age 120? This is exactly what  has happened to reader John Reading.

If Osborne is looking for inspiration to amend the ridiculous restrictions his Treasury officials introduced to income drawdown in April 2011, he should visit ampsonline.co.uk. This website, run by the providers of income drawdown plans, lists 18 suggestions on how the current draconian regime can be made fit for purpose. Whatever option he chooses, it will be miles better than the present one. 

Financial Mail has long been a supporter of vibrant bank branch networks that support local communities. It is why we have tirelessly backed the Campaign for Community Banking Services, which has called for shared branches in towns and villages abandoned by High Street banks.

We have also campaigned tirelessly for a nationwide post office network. Post offices are increasingly stepping into the void left by disappearing banks – a position that will be cemented even further next spring when HSBC customers will be allowed to deposit cash and make withdrawals at a post office. Bearing in mind the appetite for branch closures at HSBC, it will be a much-used service.

Given the community value of Britain’s 11,500 post offices, it is great news that the Post Office has just been awarded a  seven-year contract to continue providing DVLA services  through branches. It’s a fillip  for the network.

Like our bank branches, this country needs its post offices. Community matters.

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