Cynical bribes to voters: Labour and Tories under fire

Both main parties can be accused this morning of offering electoral inducements - or "bungs" - to their “tribes”. The Tories have announced an extension of high-interest-earning bonds for pensioners while Labour is pledging a near doubling of paternity pay to allow dads to bond with their new-born children.

Chancellor George Osborne used his appearance on the Andrew Marr Show yesterday to say the bonds would now remain available until after polling day to allow more pensioners to cash in.

The Treasury said it was expecting to see a doubling in the take-up of the bonds - which offer annual interest rates of four per cent over three year bonds and 2.8 per cent over one year - from the £7.5 billion sold so far.

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Yet the bonds have already led investment websites such as MoneyWeek to question why the general taxpayer should finance the doubling the going rate of interest to one special demographic group? A group that is, by the way, richer on average than all other age groups.

“Who else," asks MoneyWeek, “has £20,000 in cash to spare outside Isa and pension wrappers to lock up in bonds such as this?”

Ryan Bourne, head of policy at the Institute for Economic Affairs, told Radio 4’s Today programme this morning: “The government is borrowing more expensively than it needs to give a decent return to a certain group who happen to be pensioners… they also happen to be some of the wealthiest people in society.

"At a time when the whole argument around deficit reduction is there is no money left, it seems to be an odd political priority to be chucking money at this group of people.”

Of course it’s not odd at all if you look at the potential rewards at the ballot box. At the last general election, three-quarters of 60-year-olds turned out to vote, the huge majority of them for the Tories, compared with fewer than half of first-time voters (aged 18 to 24).

The Tories are desperate to win back the over-65s who have deserted for Ukip and, as Tim Montgomerie pointed out in The Times recently, “a skewed electorate produces skewed public policy”.

But this favouritism being shown to pensioners is beginning to anger younger voters and there’s a growing argument that it’s time the Tories looked at the long-term disadvantages.

“Courting the silver vote may make short-term sense,” George Eaton of the New Statesman wrote yesterday, “but if they are to ever win a majority again, the Conservative need to do far more to appeal to the young, a group among whom they currently struggle… Today's announcement is a reminder of [the Tories’] limited ambitions.”

But the Conservatives are not alone in offering bribes to voters. Ed Miliband, the Labour leader, will today promise to double paternity leave from two weeks to four weeks and nearly double the amount paid to young fathers to stay off work to £260 a week if he gets elected.

Miliband believes current entitlements are "outdated", the BBC reports, and that giving fathers an "independent right" to a month off would help 400,000 families offer their children the "best start in life they can”.

The policy has already brought complaints from representatives of small businesses who say they will be stuck with the extra paperwork (though they'll get reimbursed by the state for the extra payments) and that they will have to meet the cost - and bother - of finding paternity cover.

But think of the votes: 18 to 45-year-old voters are more inclined to support Labour tha Conservative. Hence yesterday’s announcement by Tristram Hunt, the shadow education secretary, that Labour plans to double the number of Sure Start childcare places to more than 118,000.

Labour is also due to announce the replacement of the current system of university tuition fees with alternative funding arrangements - possibly a graduate tax - to ease the burden on the poorest students (though it is often forgotten that they don’t have to repay their loans until they start earning more than £21,000 a year)

All of this adds up to what Miliband calls his “British promise” - that the next generation should expect to do better than the previous generation.

Or you could call it another “bung”. As Norman Smith, the BBC's assistant political editor, told the Today programme:: “It is all part of hard-headed electoral arithmetic. A recent Populus survey showed Labour was well ahead in the 18 to 45 demographic ... There is hard-headed electoral politics here.”