Thursday, November 30, 2006

Britain's Whinging Simple Shopper


Too late to complain now My Lord

I've just listened to Health Minister My Lord Warner whinging on Today that GPs have done extraordinarily well out of their new NHS contracts. He doesn't like the fact that they "kept their eye on the ball" while the Department of Health... er... ummm...

Figures released today confirm that in the first year of the new contract, average GPs pay increased by 30% to over £100 grand pa. As we've blogged before (eg see here) this is entirely down to the fact that, when they negotiated the contracts, the DoH exchanged the cash cow for a handful of those magic beans- in this case some more box ticking needed by yet another "quality agenda" (see Doc Crippen for full and painful details).

We taxpayers have ended up with signifiantly bigger bills, despite the fact that we've lost the Out of Hours service (OOH) and Saturday morning surgeries. Even if I accept- as the Doc so persuasively argued- that outside Tannochbrae, nobody else in the world ever expected OOH in the first place, it's frankly incredible that we ended up paying more for a worse service.

As we've noted many times, by intermediating itself between us taxpaying consumers and the suppliers, our simple shopper government almost always lands us with bigger bills for a worse service. We'd be tons better off doing our own shopping (watch Our Money on 18 Doughty Street at 8.30 this pm for more examples).

PS Who is Lord Norman Warner? He's someone who has spent his entire career moving between the "public and voluntary sectors – as a civil servant, local authority executive, political adviser and quangocrat" (see this profile). "High spots" include a spell as Red Babs Castle's Principal Private Secretary in the 70s. He would not be my choice of shopper.

Wednesday, November 29, 2006

Meanwhile, Back Out On The Streets...


We may have another job for him

Wouldn't it be great if we could just... I don't know... just find some way of repairing all those broken homes and somehow making those hoodie kids into responsible citizens who spend the weekends helping old people with their gardens?

Well, yes, Your Grace.... yes it would. That would be brilliant.

Unfortunately, nobody has the faintest idea how to do it. And meanwhile, back out on the streets - where wisely you no longer venture - violent crime continues to soar, and law-abiding citizens are left helpless victims by a police and justice system that is apparently no longer capable of intervening.

Item 1: the appalling murder of City lawyer Thomas ap Rhys Pryce by two teenage street thugs. You could hardly bear to listen to his fiance's "impact statement"- "There are no more tomorrows here for me and Tom — all our hopes and dreams have been brutally torn away."

Item 2: the new academic research which shows that such thugs often carry out their crimes for the thrill as much as for the financial gain:

"It weren't even for money. I had money. It was more like the buzz you get from doing things," one interviewee said.

The report's authors said part of the excitement for offenders came from overpowering and dominating the victim."

Item 3: the sevenfold increase in robberies over the last twenty-five years. In 1980 there were 15,000 recorded robberies: last year there were around 100,000.

Item 4: the latest shocking developments in Primrose Hill. We've blogged the lawless Hill before, where because of the total lack of Met policing, residents have had to hire their own private security firms to patrol the streets.

Now Tyler's friend there- who like other residents has been routinely threatened by local thugs- reports that he actually photographed one of the ringleaders committing multiple offences out in their street, while riding a presumably stolen motorbike. Evidence in hand, he requested the police to take action.

As usual they ignored him, but after threatening to supply the pix to a national newspaper, he eventually got a home visit. From four officers. Four armed officers.

They advised him not to pursue the matter. They explained that if he went ahead, then the hoodlum in question would have to be given a copy of the photos and would soon work out from the angles etc who had taken them. At which point, Tyler's friend might well get stabbed.

Their considered advice was for him to take it up with the Met Commissioner (Sir Ian Bonkers Blair- !), or the Mayor (Red Ken- !!), or his local MP (Frank Dobbo Dobson- !!!!!).

Item 5: the experience of a supermarket checkout operator of my acquaintance this morning. She'd intially gone to work without her glasses. But popping back home to get them, she found a burglary in progress- they'd sledge-hammered the door down and were ransacking her home. She was so terrified she hid in the garage.

Conclusion: Violent crime- ie the crime we actually worry about- is soaring. Despite the fact that we're currently spending £30bn pa - or £1200 per household- on Public Order and Safety.. That's enough to treble the number of prison places and still have £20bn left over for everything else.

Why do we let our rulers get away with it? They have absolutely no idea how to reform these thugs. No idea at all. And yet they continue to wibble and wobble and hold earnest discussions- like the one on Today this morning- which presume there is some "solution". And they continue to maintain that 20 years inside is quite enough to deter street murderers.

Meanwhile innocent people like my friend and the checkout operator are suffering the consequences.

As I keep telling my friend, in the absence of action by the Met, Major Frobisher's associate, Mr Gomulka, could easily arrange for the Hill's local thugs to receive an "educational visit" from some Albanian colleagues of his. Primrose Hill can afford it... whip round down the street... for a couple of hundred quid apiece they could get the whole thing sorted.

And we could then set up a collection to help the really vulnerable people on sink estates to do the same.

Tuesday, November 28, 2006

Disgusting Red Tape Worm Eats Itself!


The Worm speaking to the CBI

According to this morning's reports, the Foulwater Parasite Tape Worm is about to perform a quite disgusting evolutionary first: it's going to insert itself up its own jacksie.

Yesterday it promised the CBI it will re-ingest 25% of its own official red tape... even though it's still furiously spinning tape out of that hideous mucoid deceptor gland in the middle of its head. It's literally proposing to eat itself through its own rectum! Not even the Greater Sceptic Slimewart does that.

It will make for horrifically compelling telly when it's shown on the next series of Planet Earth, especially since its bitten off much much more than it realises.

Because while PWC (at a cost to taxpayers of £20m) has somehow assured it that the business regulatory burden is "only" £15bn pa, researchers at the British Chambers of Commerce- using the government's own figures- calculate that it now stands at £50bn pa. Labour alone has increased it by £39bn pa since 1998.

Scientists believe the Worm- which appears to be only dimly aware of the real world- may literally explode as it makes the attempt. Should be great to watch, but you'll need oilskins and goggles.

Monday, November 27, 2006

The Doc Bangs BBC To Rights

We all know the authority of BBC news coverage is not what it supposedly used to be, but the indefatigable Doc Crippen has just banged them to rights over the latest outrage.

Following their usual formula of lazy journalism and tabloid hysteria on all things scientific, they got suckered into promoting a new baby milk. The Doc pointed this out at the time, but now the BBC have finally realised their error, instead of apologising, they're trying to pretend it never happened.

Read the Doc's blast here.

And remember- we're forced to pay £3bn pa to support this lot.

Reform On Welfare Waste


We need a couple of these

In the poverty debate, Reform's new report on welfare is required reading. Its 143 pages sound like a 100% damning analysis of Gordo's welfare system.

£79 bn pa (excl OAPs).... 51 different benefits... 39% of working age households claiming one or more... 5.4 million people of working age living entirely on benefits.... Britain with more "registered disabled" than any other European country bar Poland... 800,000 working parents on 70% effective marginal tax rates - 34,000 on rates above 100%.... a total disaster both for taxpayers and many recipients.

And many will say aha, that just underlines the fact that we should abolish welfare - it may help the "deserving poor", but only at the cost of featherbedding scroungers and spreading dependency on a massive scale.

And Tyler nods and says yes, of course, I see what you mean. But turn it round the other way - what if we stop the scrounging and the dependency but only at the cost of pushing the deserving poor back into the gutter?

That's why I'm still thinking. And reading stuff like this report.

Radical reform is clearly needed, and personally I reckon the safety net remains a better guiding image than Pol's caravan.

But if only we could find that silver bullet...

Sunday, November 26, 2006

More Arts Special Pleading


Free market arts: Lemon Jelly

As I continue to mull over the poverty issue, I stumbled across a recent Observer article I originally missed. Under the headline Does Money Matter? it asks various arts luminaries and artists about their attitudes to public funding. And it's full of useful facts and figures, like the fact that taxpayers are giving £77m to plutocrats' favourite the Royal Opera House during their current three year "settlement". And that total arts spending will be £1.7bn over the same period.

Sir Nicholas Hytner, the Director of the National Theatre - which gets £15m pa of public funding - says:

"There is not much difference between the patronage bestowed on Mozart by Emperor Josef II and what the Arts Council and the Department for Media, Culture and Sport do for arts organisations like the National Theatre today.

'Whether you are talking about 18th-century Vienna or the UK today, the wealth that was and is handed out to the arts is the people's wealth. And it is absolutely right that it should be spent on the arts, because a healthy society thrives on self-examination and needs to be engaged in wondering what's beautiful and what's truthful.

'The stuff we do cannot exist on box-office alone. It is hugely labour-intensive and simply would not happen without state funding. It would be twice as expensive for audiences, so far less accessible. We spend a very large proportion of our grant on subsidised seats.'

The people's wealth.... right. Mrs T and I go to the NT regularly, but this made blood spurt from my tear ducts like that new Bond baddy. IIRC Josef II was one of those Hapsburg autocrats who probably didn't give the people too much choice over how their wealth was dealt out. And Nicky reckons robbing the poor to subsidise sweeties for a metro elite is still OK today.

Plus... and I don't mean to be cruel, but what has our bureaucratised state Arts industry ever produced that will still be performed regularly in two hundred years time? Hmm?

The article contains various other bloodboiling quotes in a similar vein.

Thankfully it seems not all arts people believe the state owes them a living. Here's Fred Deakin, Musician/animator, and one half of "electronica outfit Lemon Jelly":

'With Lemon Jelly and Airside, we did it all ourselves, financially. It came out of a frustration of having tried to go down the route of funding and realising that until you had established a reputation, the money was going to pollute what you were trying to achieve and distract you.
'I didn't want to wait around for the funding; I just wanted to get off my arse and do it. I'm really pleased that we released our own records first on our label, Impotent Fury.

'To me, it's Darwinism. If it's a good enough idea, it will survive and you'll find a way to make it happen."

Now Fred, you sound like my kind guy. Maybe we should put you in charge of the ROH.

PS One argument for subsidies not featured in the article is the one heavily pushed at the ippr seminar I attended last year (see this blog) - that arts boost the economy. Maybe even the arts bureaucrats have recognised that for the piffle it is.

Potmen Beast* Ms Kettle


Pot-bellied

It seems the problem with the Olympics is all down to Tess:

"Tessa Jowell will be sacked from her job of running the Olympics when Gordon Brown becomes Prime Minister, according to senior Labour sources. The Chancellor is said to regard Miss Jowell, heavily criticised for allowing the Olympics bill to run out of control, as being 'too lightweight' to head such a massive project.

'Tessa is out of her depth dealing with figures running into billions,' said a Labour MP with close links to the Chancellor. 'We need a tough nut who can do the sums and command more respect across the negotiating table. Gordon will not allow the bill for the Olympics to undermine his reputation for keeping a rigid control of public spending.'

Que? "Reputation for keeping a rigid control of public spending"? Are we talking about same the bloated socialist buffoon who's presided over a doubling of NHS spending, 80% of which has been wasted on cost increases, etc etc?

Even better:

"Miss Jowell's ability to deliver the Olympics on time and on budget is also questioned by Deputy Prime Minister John Prescott, according to Whitehall insiders. They say Mr Prescott doubted whether Miss Jowell or her Culture Department officials were capable of managing one of the most expensive building projects in British history.

'Mr Prescott wanted a bigger role in handling some of the land deals because of his own experience in local government,' said an insider."

We hardly need elaborate on the experience of a bloated socialist croquet-playing secretary-groping buffoon who has presided over an entire catalogue of financial disasters and dubious property embroilments, and who despite having no job, is still costing us £2m pa. And is still eating all the pies.

Now, clearly - as we've blogged many times - financial nincompoop Tess is way, way out of her depth. But the basic problem with the Olympics fiasco was the decision ever to pitch for it in the first place.

*Footnote- Ex-teacher Mrs T has put her red biro through "Beast"- she reckons nobody will know what "beasting" is. I beg to differ: according to the authoritative Zillapedia!, it's meaning is precise- "Beasted: To get owned or pushed around". Which is exactly what what these bullying playground whisperers are doing to Tess.

Pic- blah blah flowers

Recent Bonfires- 41


He only overspent private money

In the news this week:

£150,000 overspend on slipshod carpark project- "A COUNCIL committee wants to launch an investigation into why Workington’s multi-storey car park was allowed to go over budget, costing taxpayers £150,000... council officers had failed to ensure that key security features were included in the plans... the installation of movement sensors had been discussed as early as 2002, but had never been incorporated into the design of the building or the relevant tendering documents. A report to councillors stated: “The slipshod management of the contract is deplorable and an unnecessary expense to the rate payers. There is no explanation given for this lapse of common sense.” (News & Star 22.11.06)

£300m overspend on rail upgrade- "More effective procurement could have reduced Network Rail's £300 million overspend in the West Coast Main Line modernisation, according to the National Audit Office. Network Rail is set to finish £300 million over the original £8.3 billion budget to complete the overhaul of the operation. Edward Leigh, MP, chairman of the Committee of Public Accounts, claimed this saga emphasised the need to "get a grip on large-scale projects before they run out of control". (Supply Management 22.11.06)

£270,000 overspend on roadworks- "The total figure for roadworks around the Floral Clock in Palmeira Square in Hove came to a total of £965,000. In Brighton and Hove City Council's 2005-06 financial year, £450,000 was budgeted for the scheme and a further £245,000 for resurfacing the road... a £270,000 overspend... Serhat Halil, owner of Bona Foodie, Western Road, Hove, said he had lost 50 per cent of business while the work was continuing because of noise and customers having difficulty getting into the shop. He said: "All along we could never understand why the work needed to be done. It's not improved the area or made any difference apart from widening pavements." (The Argus 24.11.06)

Latest £220m overspend on Olympics- "The true cost of the showpiece venue for the 2012 Olympics was seriously underestimated by organisers of London's bid when they were campaigning to win the right to host the event, The Observer can reveal. Sports and construction experts now predict that, despite the official cost of the planned Olympic Stadium being £280m, the final figure will be closer to £500m." (Observer 26.11.06)

Nicked mobile runs up £46,000 bill- "An official mobile phone went missing in 2004 when the Scottish Parliament moved from its temporary headquarters in Edinburgh to its £431 million home at Holyrood. But no one bothered to report the disappearance, and as a result the thief managed to run up £46,200 worth of calls before a stop was eventually put on the phone. Add VAT, and the bill is far higher. Parliament officials did not even realise that the phone was missing it seems until Vodafone alerted them to the rapidly mounting bill. Margo Macdonald, an independent MSP and arch-critic of the Holyrood building, said: “A child with a mobile phone who had it nicked would know to notify the supplier immediately. It’s not just the cost, it’s the sheer incompetence. Am I surprised? No.” (Times 25.11.06)

Total for week- £520,466,000

Saturday, November 25, 2006

The Undeserving Poor


We paid for his house

This week's pronouncements on poverty from Dave and Greg have left us conservatives in a severe state of discombobulation. Some follow James Bartholomew in arguing that the state shouldn't be handing out our tax cash at all. Others reckon state handouts are OK, but only on the basis of equal shares for all- ie the Citizens' Income. Still others- mainly pinkos like me- reckon the targeted state support calibrated on relative incomes is still the least bad approach (I'll be posting on this again soon).

But one thing we can all agree on is that we don't want to give anything to the undeserving poor. And the most undeserving of all are those who systematically defraud the system. Even according to the glossed official account, they're costing us over £4bn pa (£3bn lost by DWP and £1.2bn lost on tax credits by HMRC).

That's a lot of cash, so in the unlikely event we actually catch a fraudster, we need to administer a lot of punishment- say one year in jail for every year of overpaid benefit. These are crimes of calculation and there needs to be a clearly defined and costly deterrent.

Unfortunately that's not what we do.

Today we hear yet another story of the punishment not fitting the crime:

"An immigrant taxi driver built a seven bedroom mansion in Pakistan after making millions of pounds in benefit fraud, credit card scams and fake passports. Nawaz Sharif - unemployed for the past 11 years - amassed a £2 million fortune through property, selling luxury cars and various criminal activities.

It emerged during the lengthy investigation into Sharif that while he was falsely claiming housing and council tax benefits from Slough Borough Council he was transferring hundreds of thousands of pounds back to his native Pakistan."

Sounds as bad as it gets.

And yet... all he got was 5 years. Which as we now know actually means two-and-a-half years.

Which translates into £800 grand pa.

Under Tyler's new model welfare system, he'd be looking at £2m divided by say £10 grand pa equals 200 years behind bars.

Friday, November 24, 2006

Olympics- £20bn Might Not Do It


I never even wanted the Olympics in the first place

As regular readers will know, our estimate for the all-in cost of the 2012 Olympics has always been £20bn. A "firm and robust" figure, to coin a phrase.

But if a new survey of civil engineers is right, we may need to increase it. The Gruaniad reports:

"According to this week's New Civil Engineer magazine, 500 industry professionals now see the final cost of the 2012 games at coming in 39% over even the worst-case-scenario costs envisaged by the government consortium.

The price originally put forward in the London bid was £2.375bn. This week Ms Jowell admitted that it had risen £900m to £3.3bn, with more increases "inevitable". Although a final budget has yet to be presented to parliament, a worst-case budget scenario of £6.2bn has been mooted.

On top of that will be the so-called "contingency fund", which London mayor Ken Livingstone is wanting capped at 20%. Today's survey of 500 civil engineers recommends a 39% contingency fund, pushing the final cost up to a potential £8.6bn.

Those prices are pre-VAT, pushing the potential final bill up to £11.6bn."

Yes, I know what you're thinking- how can 17.5% VAT take £8.6bn up to £11.6bn? But this is the Grauniad, so let's scale it back to the correct figure of £10.1bn. Even so, add in the other £11.4bn of "incidentals" (see previous blog) and you're looking straight down the barrel of £21.5bn.

And six years still to go.

Gulp.

Chippenham In Olympic Bid Madness


Webb: "We're already seventh in the Southern League Premier Division"
Despite knowing all about the multi-billion financial disaster now befalling London taxpayers, Chippenham Wiltshire is pressing ahead with its own Olympic bid. According to This Is Wiltshire, civic leaders see a brilliant Olympic future for the town. Chippenham Town chairman Sandie Webb (pic above) says:

"The 2012 games is hugely exciting and we want Chippenham to be a big part of it. We have numerous locations in the district which would be suitable for a number of sports."

They reckon it wouldn't cost taxpayers much because local businesses "would come on board".

Local employers? And who might they be? The town has a population of 33,000 and according to Wiki, "the largest employer in the town appears to be a part of Westinghouse". Hmm. Actually I suspect the largest employer is probably North Wiltshire District Council.

Look, Sandie, love, I think maybe you should go and lie down for a while. Say, until 2013.

More Waste News From BOM Correspondents

At least they got the right ammunition


Over at the Purple Scorpion, there's a good summary of recent Big Spender outrages. Prezza, the Commissar, and the Met once again all feature strongly, but the Scorpion also points to two future threats hurtling down the track towards us: the upgrade of the West Coast mainline - now projected to cost £8.6bn against an original budget of £2.5bn - and the... ugh, I can feel another attack coming on... the Olympics.

Meanwhile, EJD points us to all that duff ammo our boys on the North West Frontier are being forced to use. According to the Telegraph report:

"The situation became so serious that a platoon from the 3Bn The Parachute Regiment refused to go out on patrol until the problem was resolved. The troops had to borrow ammunition off Canadian and American special forces as they battled to fight off Taliban attacks."

The Telegraph page also links to a shocking video apparently showing two British paratroopers struggling to use the duff bullets in combat.

It's all because MOD have been trying to offset the waste of money poured into all those ludicrously overpriced and unneeded cold war weapons by cheeseparing on essentials for the real frontline:

"It is thought that the batch of ammunition was from either Pakistan or the Czech Republic, where a round costs 60 US cents. The price for British, Canadian or American ammunition is $1.50. With many thousands of rounds fired, using cheaper ammunition would have saved thousands of pounds."

Words really can't describe the hypocrisy of grandstanding politicos who send our troops into battle without the proper kit to protect them. Let's all hope there's a special place in hell reserved for them.

Spoiling A Good Joke


Timms in action - a shame nobody laughed

For waste obsessive types like Tyler, the highlight of Gordo's March Budget speech was when the entire House of Commons erupted in derisive laughter as he announced his latest Gershon "savings". Because as we've blogged many times, the Gershon programme owes more to the Marx Brothers than to anything remotely resembling the Real World.

So we'd been looking forward eagerly to his next announcement scheduled for December's Pre-Budget speech. We were even going to prepare a short preparatory briefing so everyone could share the joke.

But the swine has wimped out. He's forced his assistant- Chief Secretary Stephen Timms- to release the joke early so he doesn't have to do it.

Thus it was that a nervous Timms yesterday took the mike at a little known Whitehall comedy club and told his small invited audience of Guardian journos:

"A total of £13.3 billion in efficiency gains have been reported, more than doubling the annual savings recorded in the 2006 Budget. These savings include a gross reduction of 54,963 civil service posts and 10,574 posts relocated out of London and the South East. The figures show that the Government remains on target to meet its 2008 Gershon Efficiency Target of £21.5 billion in annual efficiency gains with a gross reduction of 84,000 civil service posts."

Stoney silence. Even when Timms threw in a risque ad lib about getting more "bang for the taxpayers' buck", all the Gruaniad hacks could think about was the "devastating impact on services already suffering after job cuts and privatisation".

Come on guys - lighten up. This is STAND-UP COMEDY... none of it is meant to be... like, real.

Take those "job cuts"- according to the Office for National Statistics, the Civil Service hasn't actually shed 55,000 posts. No, not at all. Since 2004 Q1 when the Gershon clock started ticking, the ONS says Civil Service employment has fallen by only 11,000 - only one-fifth of what Timms said (see here). As for the supposed money savings, Timms just says the first thing that comes into his head, because there's absolutely no independent evidence they add up to a row of beans (see previous blogs).

That's the joke you see. Geddit?

Gawd- you guys should get out more.

The problem is that Timms is just not a natural comedian like Gordo. It's like giving Groucho's best one-liners to that one who couldn't speak.

Can't they get anything right?

PS As I may have said before, long ago in a previous life I met Stephen Timms regularly. Although we are from different bits of the political spectrum, he always struck me as very bright and a very decent man. His views were always worth listening to. So I'm wondering if he can possibly believe any of this stuff. It would be very interesting to find out what he really thinks.

Thursday, November 23, 2006

Poverty Wars


Still picking up new fans

Greg Clark is one of the few MPs I actually know, and I have developed the utmost respect for his views. On everything I have ever discussed with him, and everything I've ever heard him say, he's been entirely sound. And impressively, he's one of the few top Tories who went to a bog-standard comp.

So when, two weeks into his new shadow job on charities, he comes out with a paper on poverty that brings down one of the biggest avalanches of critical comments ever seen on Conservative Home, I'm left scratching my head.

Let's start with absolute vs relative poverty. Thanks to James Bartholomew, we know that the left invented the concept of relative poverty in 1959 to justify a huge expansion in the welfare state. But as Greg points out in his paper, the idea that poverty can only be sensibly defined in the context of the society to which it relates, actually goes back much further, at least as far as Adam Smith.

And while Churchill talked about his famous "safety net", he was pretty vague about the height at which it should be set. These days, I'm guessing he'd accept that a British family who could not afford a fridge and a washing machine would be poor.

So for me, unlike some conservatives, there's no fundamental problem with the idea of saying that poverty is a relative concept, and that the calibration of the poverty line depends on how rich everyone else is.

Obviously that still leaves huge questions about where and exactly how to draw that line- eg I reckon 60% of median income is too high, and we should have stuck at the traditional 50% (eg see this blog). And clearly the problems of many poor families will not be solved by simply doling out ever larger pots of money.

But at this stage, Greg isn't actually suggesting anything other than doing some more thinking.

And he's absolutely right to point out that Labour's much trumpeted success in "reducing poverty" is little more than yet another scandalous fudge, with the gainers heavily concentrated among the rich poor. The much harder to reach poor poor- ie the ones who really need the help- have actually slipped even further. Exactly like the £3bn Sure Start fiasco (see this blog).

But bigging up Pol is of course an entirely different matter. As is the use of that desert caravan analogy which implies that slowing down the whole is justified to make sure everyone stays together.

As a shock tactic, it's certainly done the trick, garnering far more attention than Greg ever managed during his fairly brief time on the Public Accounts Committee. And I guess we must see it as part of DC's war of electoral movement.

But poverty is an issue that's always been difficult for Tories, and Greg is right to cast around for some fresh thinking. So while shaken, I'm not stirred. I reckon that Gregs' final conclusions will be some way from the Polly Heaven so wonderfully described by Boris this morning.

PS Just to put this in a money context, we're now spending getting on for £180bn pa on "Social Protection".

Those Were The Days...


Sharing the proceeds of recession

Excellent Telegraph letter from Corin Taylor, the Head of Research at the TaxPayers' Alliance, which concludes:

"Mr Osborne correctly argues that Gordon Brown's tax rises have damaged the economy and hit families hard, but, worryingly, he said at the launch of the Tax Reform Commission Report that any tax changes will be "revenue-neutral". In other words, every tax cut will be met by an equal and opposite tax rise.

Britain seems to have moved towards a high-tax, high-spending state with little debate. Mr Brown should not be allowed to win that easily."

Absolutely right. And Corin makes an interesting point about the Thatcher tax increase to balance the fiscal books in 1981, which have been touted by George as showing that he's just following in the footsteps of St Mag:

"The reality is that Tory tax rises in 1981 made the economic pain of reducing inflation, which was really achieved via monetary policy, that much worse."

He may well be right about that too.

Warning: tedious economic reminiscense follows.

Speaking as one who was literally there at the time, the public finances were in a awesomely shocking state. Public sector net debt was 46% of GDP and rising, with borrowing heading back up through 5% (see table C25 here). To be sure, there was a clear understanding that monetary policy was the key to controlling inflation, but market-based techniques of monetary management were all having to be relearned after forty years of corsets and other extremely questionable regulatory undergarments.

And one theory said that it was the fiscal deficit itself that was making the whole exercise virtually impossible because it necessitated such massive gilts issuance to prevent it being monetised. Interest rates were pushed through the roof, dragging the Pound with them, and blowing away British industry in the process.

With what we now know, maybe things would have been done differently, and maybe Thatcher wouldn't have whacked us with the tax hike. Certainly the famous 364 economists who signed that notorious Times letter said more or less that at the time.

But as David Smith points out here, the 1981 Budget also cut interest rates by 2%, allowing the Pound to fall. It ushered in a more flexible implementation of monetary policy, away from the strict targeting that had caused such problems, and more akin to the Bank's current approach.

That was the future once.

Horrible Airbus Facts

The "Top Table" shreds another $20bn

The Indie has a useful summary of where we are on the Euromoneypit Airbus A380:

  • Original development budget $10bn: current estimate $14bn
  • Additional costs from delays- $6bn
  • Original breakeven sales target- 300 planes; new breakeven- 420; current order book- 149
  • Cancellations- FedEx has already cancelled its 10 planes, at least one other cancellation is imminent
  • CEOs- Airbus now on its third CEO since the summer: Noel Forgeard was forced out by a strong whiff of insider share dealing; Christian Streiff was forced out after just three months when his emergency restructuring plan was rejected by politicos; new man Louis Gallois is a French civil servant!
  • Parting shot- "It is Airbus as a whole which failed, the management on several levels and with several passports who failed.... Airbus is not yet an integrated company" (Streiff, who also said Airbus are at least ten years behind Boeing)

Meanwhile, despite BAE's sale of its stake, British taxpayers remain firmly on the hook (see this blog). We have put in £780m*, mainly in the form of so-called "launch aid" (theoretically repayable if the wretched thing ever makes a profit... don't hold your breath). And when the wings assembly plant at Broughton and other facilities at Filton are eventually closed down, we'll doubtless have to pick up the tab- remember the MG Rover closure cost us £250m, so with twice as many workers involved in Airbus, the bill this time will be c£500m.

*Footnote: the Indie quotes a UK taxpayer contribution of £530m. But that is just for the aircraft itself (mainly for the wings, that are made here). There is a further £250m for the engine development at Rolls Royce (see HoC answer here)

Good News For The Gentlemen


Brandy for the parson, baccy for the clerk

The European Court of Justice has just ruled that the tobacco smuggling industry should continue to be protected against the predations of a market free-for-all.

Contrary to earlier reports (see this blog), the Court has now decided that we will not be allowed to make on-line purchases of cheap French fags and booze for home delivery, and will need to continue our reliance on boot sales. The gentlemen will be pleased.

As will Gordo, since he stood to lose £15bn pa.

But of course, tobacco smuggling already costs the rest of us taxpayers £3bn pa (see this blog), and with massive Gershon job cuts at HMRC, there isn't the faintest chance that number will be coming down any time soon.

Carry on trotting.

Wednesday, November 22, 2006

George And The Doc


Free market economics can be fun... no, really

Today George Osborne attempts to answer the good Doctor Stelzer's accusation that Tory economic policy amounts to 'plenty of nuthin'.

Yesterday, Rupert's favorite Doc let the Tories have it with both barrels. Quote:
  • Osborne has got trapped into defending the proposition that tax cuts threaten economic stability
  • even Gordon Brown admits the public sector is so bloated that it needs a fiscal diet, and that the public sector is so wasteful that it is pulling down the nation's productivity. This is the beast that Osborne produces to feed, lest anyone think his party "mean".
  • Tory policy is really a policy-by-default. It assumes it is politically impossible to rein in spending. It assumes that unlimited consumer choice is unacceptable, which means that the public sector monopoly can operate free of threat to its inefficiency. It guarantees the further enlargement of the public sector.

So much for the economic realities, but even politically, the Doc reckons the Tory stance is not much of a match-winner. He points out that Brown not only outranks Dave and George on economic stability, but he's also highly likely to to outflank them on tax cuts. Wibbly economics and loser politics: you begin to see why Rupe remains a Brown supporter.

George's response? Well, he's a big fan of the Doc's and that Hayek chap, BUT:

"Though I want to slow the growth of spending, I do not want to bring about "real reductions in public spending". And it is also true that we are not going to allow people to take NHS money and combine it with their own funds to buy healthcare. We want to focus limited resources of improving the NHS for the many not providing opt-outs for a few.

It is time to learn from three election defeats."

In truth, it's just the downbeat centrist image-led muddle-through we've heard many times before. But smacked down on the counter alongside the bright fresh clarity of Stelzer, there's just no contest.

PS When evil scheming geniuses fall out: Richard Branson's outburst yesterday on hearing that he'd been outplayed by Murdoch in his attempt to gobble up ITV was a classic of the genre. Referring to News Corp as the "empire", he said "If the Sun and the Sunday Times and Sky and the News of the World all come out in favour of one particular party, the election is going to be won by that particular party. Basically we have got rid of democracy in this country and we might as well let Murdoch decide who is going to be our Prime Minister." I'm amazed he didn't mention Rupe's well-known penchant for eating babies.

Tuesday, November 21, 2006

Important News From BOM Correspondents Around Britain

BOM correspondent with fingers stuck in keyboard

Since adding an email address to the sidebar, we've been getting a steady stream of excellent leads from waste-watching correspondents right around the sceptred isle:

David H has done a jaw-dropping calculation on the £40.6m "invested" in 'Renaissance in the Regions', aimed at increasing regional museum attendance. As he points out here, each additional visitor seems to have cost us £75. He says, "I can't help thinking that simply offering people £50, perhaps in the form of taxi fares and a free slap-up meal in the museum
cafe, might not be a more cost-effective way to boost visitor numbers."


Excellent point (and excellent photos on David's blog).

Tony draws attention to the Sun's exclusive yesterday on convicts claiming Working Tax Credits:

"KILLERS and armed robbers are exploiting a benefits loophole to rake in thousands — behind bars. Lags allowed out of a jail each day to do jobs are topping up their wages by claiming Working Tax Credit.

The bonanza was blasted as a “farce” yesterday — as it emerged taxpayers are footing a bill of more than £50,000 a year. Working Tax Credit is meant to help hard-up families.

But prisoners let out to work while serving the last stretch of their sentences at Kirklevington Grange prison near Stockton-on-Tees realised they too could claim. They are eligible even though they return to cells each day and have no food, accommodation or travel costs."

Absolutely outrageous- Major Frobisher has gone completely purple. The immense complexity of Gordo's half-baked tax credit system is already costing us at least £1.2bn pa in fraud and loss, but this particular wheeze is even worse- it's entirely legal.

Tim points us to Birmingham and yet another public sector IT fiasco:

"Birmingham City Council pulled the plug on its 535,000 pounds open-source pilot after its analysis concluded that it was cheaper to upgrade to a Microsoft-based platform than proceed with open source.

The council planned to roll out Linux software and applications on 1,500 desktops in libraries across the city, but in the end went no further than a 200-desktop project. Several industry watchers have voiced their concerns about the project, particularly around the number of PCs rolled out. Birmingham's expenditure averaged over 2,500 pounds per PC.

"That's ridiculous," said Eddie Bleasdale, the owner of open-source consultancy NetProject and an early participant in the project. "It's an unbelievable cock-up... They decided to do it all themselves, without expertise in the area," he added, saying that a lack of skills in open source and secure desktops would undoubtedly have raised costs."

It's a story that sounds so horribly familar: lack of proper planning, lack of skills, and an apparent lack of understanding that the cost of the software itself is only a fraction of total implementation and running costs (cf the NHS supercomputer).

Finally, the redoubtable David Blackie gives us the latest update on the appalling British Council. David does us all a service by keeping a very close eye indeed on BC, and his latest spot is from the Yemen Times. It seems we taxpayers have just funded a painting trip to Yemen for Sir David Green, the Director General.

As Green says “Painting for me is more than a hobby. It is a part of my daily life that I can express my feelings through”. So he's wangled a BC-funded trip to Yemen to open a "new British Council exhibition, The Looking Glass. It is an exhibition of arts photographs of aspects of contemporary Muslim life in the United Kingdom and Yemen, by British and Yemeni photographers." Can't take more than twenty minutes, which will leave him plenty of time to pursue his hobby.

Which is nice. Particularly since insiders reckon he makes a habit of it.

The BC costs £0.5bn pa, including £0.2bn of direct tax funding (see this blog for more).

Many thanks to all correspondents- please keep them coming.

Tess On Rack

Finance expert Tess reassures us on Olympics

I've just driven home listening to Tess J being racked at the Commons Culture, Media and Sport Committee. I must say there wasn't nearly enough screaming for my taste, but she has at least now admitted the 2012 costs are heading up.

Partly because she has decided to spend £400m on "an Olympic partner who will ensure the budget is stuck to", the... er,budget has been breached. So that rigorously costed figure of £2.375bn is now a rigorously costed figure of £3.3bn.

And her response to resigned ODA Chairman Jack Lemley's pretty clear indication that the budget is completely out of control?

"I disagree with him."

Right. So lets just remind ourselves of their respective qualifications for making such statements:

Jack Lemley:
1960-1967: Various Graduate Positions (Guy F. Atkinson Company)
1967-1969: Assistant Project Engineer — Shift Superintendent, Guy F. Atkinson Company Mica Dam Contractors
1969-1970: President, Healthcare, Inc.
1971-1972: Project Manager, Walsh-Canonie Joint Venture (Guy F. Atkinson Co.)
1972-1975: Contracts and Engineering Manager, Water Tunnel Contractors (Consortium led by Guy F. Atkinson Co.)
1975-1977: General Manager, Walsh Construction Company (Subsidiary of Guy F. Atkinson Co.) 1977-1979: Vice President, Special Assignments (Marketing), Guy F. Atkinson Co.
1979-1981, General Manager, King Khalid Military City Project, M-K Saudi Arabia Consortium
1981-1983, Vice President, Heavy and Marine Group, Morrison-Knudsen Company, Inc.
1983-1985, Group Vice President, Heavy and Marine Group, Morrison-Knudsen Company, Inc.
1985-1987: Senior Vice President, Construction Division, Morrison-Knudsen Company, Inc.
1987-1988: President and Chief Executive Officer, Blount Construction Group of Blount, Inc.
1989-1993: Chief Executive Officer, Transmanche-Link Joint Venture — TML, The Channel Tunnel Contractors
1995-2001: Chairman and Chief Executive Officer, American Ecology Corporation
1988 - present: Principal, Jack Lemley Associates

Tess:
Psychiatric social worker
Assistant director of the mental health charity MIND
MP

Now, whoyagonnacall?

Sunday, November 19, 2006

Lighting Up Time


A banker's work is never done...


It's Sunday evening, and as my correspondent in Canary Wharf enters the final lap of his latest all-weekend work marathon, he is spluttering and choking over the article in yesterday's Times lambasting Wharf banks for needlessly "leaving the lights on".

Because under the headline "Sunday, 0001: the lights are on, but no one's at home . . ." the Times relays the latest eco-propaganda from government funded "NGO" Global Action Plan. They sent a photographer down to the Wharf to get the late-night snap above, and reckon the offices must have been empty.

But at 0001 am on Sunday, the working weekend is still young. NGOs may knock off at 4.15 on Friday afternoon, but in Global Finance things are different. Down on the Wharf, the Beast must be kept fed and watered 24/7, lest it burst from its cage and rampage through the streets bringing destruction to the entire wibbling eco-trifle (in case GAP don't know, Finance and Business Services now account for nearly 30% of national income).

Against which, GAP's assertion that the "unnecessary" lights are costing the banks £17m pa is a pure piffling irrelevance. As for pumping out "as much carbon dioxide as 346,000 transatlantic flights"... a quick mental calc: £17m fuel cost divided by 346,000 equals £49 per flight... I'm no expert, but shurely your typical B747 uses that much just starting the engines.

And to make things even more splutteringly gut-bustingly spit-making, my correspondent reckons that since GAP made their findings known, the Wharf's Corporate Social Responsibility Police have been busy disabling as much office lighting as possible, so the night shift (ie the day shift working on into the early hours) has to stumble around by candlelight hoping not to fall down a lift-shaft.

There are rumours of banks going out to recruit teams of blind financial analysts who won't cause such corporate embarrassment in the first place.

Tyler has been instructed to find the offices of Global Action Plan, hunker down outside with a Box Brownie, and not return until he's got some snaps of their own eco-indiscretions. There is a similar plan for the Carbon Trust (cost to taxpayers £70m pa), and the Energy Saving Trust (cost to taxpayers...er, another £70m pa).

Watch here.

PS My Wharf correspondent also unkindly suggested the name of GAP's Director- Trewin Restorick- might be an anagram of Droopy Prick. I told him he needed some sleep.

PPS Yes, I know- GAP's fuel calc was supposed to be fuel per trans-Atlantic passenger journey, rather than fuel per aircraft journey. But I like my calc better.

PPS For an hilarious insiders' account of why investment bankers need to do it with the lights on, read the excellent Monkey Business.

Recent Bonfires- 40


In the news this week:

Olympics cost hits £8bn- "Public support for the 2012 Olympics is in danger of draining away because costs are likely to reach an astonishing £8 billion, according to a devastating report by members of the London Assembly... The £8bn figure is considerably higher than the £5bn revised budget for the event produced just last week... Brian Coleman, the Assembly chairman and a Conservative member, said last night: 'We were told the £2.4bn figure was robust and rigorous. It turns out that it was a back-of-the-envelope fantasy job. The question now is: who pays?' Assembly members yesterday said they fear that London's Games could end up being the most expensive ever." (Observer 19.11.06)

£40 per hour for yobs' media training- "Teenage criminals are receiving media training – costing up to £40 an hour - in a police campaign to improve the public's perception of young people. About 25 serial and former offenders, aged 13 to 17, sit on the 100-strong Essex police youth forum, which advises officers on how to tackle youth offending. Sergeant Ian Carter, programme manager of the £1.3m Proactive Essex Police Youth Strategy (Pepys), said the media training would help to tackle "misperceptions" among adults about young people and anti-social behaviour." (Sunday Telegraph 19.11.06)

£53m wasted on deathtrap army taxis- "The four soldiers killed in Basra last week... were not on "a routine boat patrol", as the MoD claimed. They were being transferred up the Shatt al-Arab waterway, from one British HQ to another, in "water taxis". This is because we have no transport helicopters for this purpose and no vehicles sufficiently protected against roadside bombs to transfer them safely by road.... The MoD could have supplied our troops in Basra with mine-protected RG-31s, as used with similar lifesaving success by the Canadians in Afghanistan. But instead of paying £280,000 apiece for the RG-31s they had on trial in 2003 (and could by now have in service in Basra), the MoD preferred to spend £413,000 each on 401 highly-vulnerable Italian-made Panthers, which in any counter-insurgency would be useless [413,000-280,000 x401= £53.3m]... It has preferred to spend billions equipping our forces to play their part in a fantasy "European army" of the future rather than spend very much less to equip them for the real wars they are actually having to fight now. (Sunday Telegraph 19.11.06)

Livingstone's Venezuela debacle cost £29,637- "KEN Livingstone has revealed his stop-over in Cuba and aborted trip to Venezuela cost Londoners a "modest" £29,637. The mayor was left stranded in Cuba last week after Venezuelan president Hugo Chavez said he was "too busy" electioneering to sign an oil deal. Livingstone and his four officials stayed in Havana for six days at a cost of more than £13,146, including £11,086 on flights, £1,530 on accommodation, £132 on meals, £195 on transport and £202 on phone and internet lines. Another four officials flew directly to Venezuela at an estimated cost of £16,491, including £12,948 on flights." (This is Hertfordshire 14.11.06)

Total for week: £8,054,329,637

Friday, November 17, 2006

Gone To Pot


Patched up with Playdough

Barry Tyler (above- no relation) is a persistent man. And to Hertfordshire County Council, no doubt, a right pain in the bum.

After he had driven into a pothole near his home and damaged his car, he demanded compensation from the Council. And following a protracted dispute, he won an out-of-court settlement of £400.

But unlike most people, he didn't stop there. "Intrigued" by how there could be such a large hole in a spot where a surveyor had supposedly checked the road the previous year and not even seen the hazard, he demanded more information. And armed with the maintenance work invoices he extracted, he somehow dragged out Herts Highways' assistant director of transport management to inspect some of it. According to Barry's account:

"I looked at maintenance work on potholes on the B1368 Anstey Road between July and August, which had cost taxpayers £1,917. I pointed out to Mr Smith that the work consisted of a blob of Tarmac dumped into the hole without any preparation and without any sealant to keep water out.

He said this was quite satisfactory as it was only a temporary repair to make the road safe. I think the whole job must have taken under three hours, but the charges for this work vary from £295 to £823 per hole!

If you don't finish this work off properly water will get into the Tarmac, causing damage, so work which should last for 10 years could need re-doing in 18 months. The whole situation is ridiculous - over 90 per cent of work invoiced is not checked."

Last year English and Welsh local authorities paid out around £70m compensation for accidents and vehicle damage caused by potholes and other poor road maintenance. And thanks to Mr Tyler's investigation we now know we're not even saving on the skimped maintenance. In effect, we're paying twice.

It's enough to... er... drive you potty.

Capitalism And Friedman


Milt to the rescue
Milton Friedman was a giant - a brilliant man who made sound money respectable again after the wild and dangerous socialist experiment with "Keynesianism".

It was Friedman who provided the intellectual foundations for the economic stability we now enjoy, and it was Friedman who gave the confidence to politicians around the world to change course.

When I was learning economics at undergraduate level, leftie profs told us Keynes had saved capitalism by showing governments how to manage its supposed tendency to generate mass unemployment. But the real saviour of capitalism in the twentieth century was Milton Friedman.

PS The BBC's Friedman obit has been predictable- yes, he rediscovered the importance of sound money, and yes, he won a Nobel Prize, but he was tied up with that dreadful Thatcher woman who destroyed Britain's manufacturing industry and caused mass unemployment. Shame on you Evan Davis.

PPS Yes, I do know Keynesianism was not actually what Keynes himself said. And yes, maybe if he'd not died, he could have pointed that out. Which might have fended off the cloud cuckoo land of Butskelism. But somehow I doubt it.

There Was A Young Lady From Bude..


Oh for a muse of fire...

I'm honing my undoubted skills as a poet so I can get an Arts Council grant for a winter break.

The Council has just given £7,000 to a poet from Derbyshire so he can go out to Australia for the cricket tests and write some doggerel. They were apparently impressed by his "Old Trafford Treatment Room Chant" to the "Football Poets" project, another tax-funded wheeze:

"Composed to the rhythm of the conga (and slightly dated since the Manchester United striker Wayne Rooney's recovery from the injury) it goes: "Meta-meta-metatarsal, Meta-meta-metatarsal!"

Umm... look I know I'm just learning, but does that actually scan to the conga? I thought the conga went da-da da-da daaa-daa. Not da-da da-da da-da daaa-daa.

£7 grand! Of our money. Can you believe it? Even old Humphrys on Today this morning was taken aback. The poet himself justified it by saying the BBC would benefit because he would be supplying some of the work to BBC Radio Derby. Well, that's OK then. One tax-funded outrage supporting another.

Anyway...

There was a young man from Caracas,
Who fell over and crushed his marraccas...

PS Can you name any great tax-funded poetry? And I don't count working for the public sector as a librarian. As we all know, your ideal poet needs to live on kitchen scraps in a rat-infested attic.

Thursday, November 16, 2006

Income Redistribution


Let's see you challenge Shameless Mick's masculinity then

Taking from the rich and giving to the poor used to depend on Robin Hood. And you could avoid paying simply by avoiding Sherwood Forest. But that was before the whole gig got nationalised, and you were forced to pay up wherever you were or whatever you thought about it.

Two current stories show how it works:

Item 1: Mick Philpott (49) lives entirely on benefits with his wife (27), mistress (22), and his 15 children. He's known as "shameless Mick" and, having refused the snip, has just managed to get both women pregnant at the same time (well, strictly, we don't know it was at exactly the same time). Now he's demanding a bigger council house. As he says:

"What man wouldn't want two women? Some people call me a scrounger, but I'm not. I'm just a good father."

You can say that again Mick - I reckon you'll soon be in the Guinness Book of Records.

Mick and his family are costing us £500 pw in cash benefits (equals £25 grand pa), plus the subsidised house (say £10 grand pa), plus free education for 15 kids (say £75 grand pa), plus Gawd knows what free healthcare (say £10 grand pa). The burden on the rest of us is well north of £100 grand pa.

Item 2: Richard Fitzmaurice, the 75 year-old ex-soldier jailed for refusing to pay his Council Tax, was released after yet another "mysterious benefactor" (presumably another Labour cashpoint peer) paid his £1300 debt. And that was despite his statement that he'd gone to jail fully equipped for a long stay, with his shaving kit and a spare pair of underpants.

Mr F's wife was reportedly not best pleased by his stand, but he had a point. Average Council Tax in England has doubled since Labour came to power (up 96.3% since 1996-97), whereas the basic state pension has increased by just 38% (yes, that's right- see here). It's an enormous gap that has hit all but the very poorest pensioners hard.

Wonder how Robin would have dealt with such outrages?

PS The state broadcaster's ludicrous pc Robin Hood series has rightly drawn derision from all sides (see Paulinus' take). I particularly like the sound of Muslim gang member Djaq (pic above), of whom the BBC puff says "Djaq's presence sometimes proves a threat to the gang's masculinity, as the outlaws frequently try to prove that they have skills she cannot match - usually without success. The fact is, Djaq is an incredible woman, and an even more incredible man."

Wednesday, November 15, 2006

NHS Supercomputer - Panic At The Top


"Absolutely no need to panic"

We've blogged the disastrous NHS supercomputer so often, it hurts (start here). And by now we all know the grisly numbers- £6bn originally declared, now officially £12bn (except for Health Minister Lord Warner who blurted out £20 bn), and anything up to £50bn actually predicted by industry insiders.

Add to that the NAO enquiry, the heated PAC probe, and the fact that key suppliers are baling out and/or going bust (see here for an excellent update- htp Mad Rad), we can't say we're surprised that senior management has finally lunged for the panic button. The new CEO of the NHS has reportedly intitiated a "confidential review" of the whole shebang:

"Those involved indicate that this is a review that dare not speak its name. "Connecting for Health are insisting this is not a 'review', and is nothing to do with the past but all about the future," explained one senior industry source.

One CfH source stressed that the review was not being undertaken by CfH but by the Department of Health: "It’s a review that's being done to us".

Sounds ominous.

Are we watching the start of the final act?

Taxpayers should certainly hope so. And they should also pray it's a short one.

PS The average tenure of a Health Secretary is two years, so this could mean an early blanket bath for the Commissar. In reality of course, the Supercomputer was yet another eye-catching initiative ordered by the Beloved Leader himself. At a No 10 summit in February 2002.

Olympics Meter Starting To Spin

Ever since we won the wretched thing, it's been obvious the cost would spiral way beyond the ludicrous lies spun by Blair, Tess, and Ken. Our estimate has always been £20bn, compared to the advertised figure of £2.35bn (eg see here).

Today we get the latest reading: £5bn. The head of the Olympic Delivery Authority explains:

"We are still in the early stages of what the additional cost may be but it will be in the order of a billion, perhaps a billion and a half, and clearly that is something that must be funded by the government."

He said that the original budget had been put together without a full analysis of the site or fully-costed designs for new venues.

"Security costs have increased since two years ago and regeneration costs are significantly higher than was allowed for before.... I believe that an adequate contingency needs to be allowed for a programme that still has six years to run."

So that's OK then. That rigorously costed firm and robust estimate of £2.35bn turns out to have been produced on the basis of pretty well nothing.

The only real question for taxpayers is whether this is classic salami slicing, or just sheer downright incompetence.

Either way, we'll be picking up the tab.

Clear Desk Policy


Typical clear desk policy in action

Every organisation Tyler ever worked for had periodic bouts of clear desk policy. It works like this.

The boss, who has a huge private office with a huge desk and huge amounts of personal filing/rubbish storage, is trying to drive through a widely bigged-up "change programme". He's hired some expensive consultants, but is getting concerned that all that strategising, sloganising, and general arsing around doesn't seem to be having any effect on the actual stuff the organisation supposedly does. In fact, with whispering at Board level, he's starting to cake it (htp Robert W).

One evening he walks around the open plan decks where the rowers are chained and suddenly understands why. The whole place is a total shambles! All the desks are covered with crap! Paper, books, unopened letters, empty Coke cans, half-eaten pork pies, discarded items of intimate apparel... it's a disgrace.

An untidy appearance betrays an untidy mind. Everybody knows that. So the next morning he emails round the Clear Desk Policy. At pain of... well, something bad.

And this is exactly what's happened at the increasingly shambolic HM Revenue and Customs. Under Sir David Varney (abruptly "exited" four months ago), they'd been trying to drive through a twenty year old management hoola hoop from the manufacturing industry called LEAN production. No matter that it was designed for turning out Toyotas.

Needless to say, it's been a disaster, with delays and error rates creeping up, and staff leaving in droves ( see Politicalblog here for an excellent insight).

The one thing we can be sure of is that it will have no lasting impact on desks. After an initial flurry, people will point out that there isn't enough filing space. They can only clear their desks if entire new banks of filing cabinets are installed... which means more office space will have to be found... which means the office will have to relocate... which means the change programme will alas cost even more than leaving things as they are.

Much more sensible to let the pork pies stay, and for the boss to remain ignorant inside his spacious cocoon.

You won't need me to spell out the "clear desk policy" HMRC really needs.

Tuesday, November 14, 2006

Cheaper Booze And Fags


Lost tax base

The duties on booze and fags have been staples of government revenue for three hundred years. And throughout the entire period smugglers have been trying to find a way round them. A few months ago we blogged the estimated £3bn pa the government already loses to tobacco smuggling, reckoning it illustrates the limits to punitive taxation.

Now the European Court of Justice is apparently about to put the smugglers out of business by making it legal to buy over the internet direct from low duty countries. Which would mean domestic duty rates would soon have to be harmonised with at least the lower French rates. Bad news for smugglers and the government, but great news for drinkers, smokers, and the end suppliers.

As the Taxpayers' Alliance has already commented, taxpayers will have mixed feelings about this. Obviously lower taxes in any shape or form are to be welcomed. But unfortunately- quite apart from the fact we are yet again being forced to follow a European directive- any cut in the £15bn pa revenue from these duties would simply be made up by increases elsewhere. And personally, as a non-smoker, I prefer smokers to pay.

Still, there is a message of hope here for those of us who want to see smaller government: international tax competition is starting to make itself felt all over.

For those unfamiliar with the theory behind international tax competition, there's a primer here. All it really says is that as global integration proceeds, capital and labour become ever-more footloose, and national governments have to become ever-more careful not to "price" their economies out of the market by over-taxing. Which in turn means they can no longer spend as much as they like.

As we've seen from the recent alarm over HSBC and other major companies relocating to lower tax domiciles, such competition is already very real in the field of business taxation. Now, in a European context at least, we can see similar international pressures circumscribing the ability of our government to tax consumer spending.

Some see this as a "race to the bottom", with no government able to risk spending on "decent public services". That might conceivably be true in some poor countries. But in Britain, we're miles away from that situation, and international tax competition could yet deliver the smaller government our first-past-the-post electoral system seems incapable of gripping.

Congratulations To TPA


Last night Mrs T and I attended the inaugural ConservativeHome Awards. An evening of unashamed glitz and glamour: from the limos disgorging scores of vestless starlets onto fully 200 yards of red carpet, right through to Tim Montgomerie threatening to break legs unless people paid their ten quid entrance fees.

Many worthy award winners, including the excellent Richard Bacon for his outstanding work on the Public Accounts Committee.

But naturally we must single out the TaxPayers' Alliance, which won the One to Watch Award. Well done to all at Warwick Row.

PS Best off the cuff acceptance speech came from Matthew Parris, who like all of us had watched a huge wasp buzzing ominously round the room. He reckoned it was like ConservativeHome buzzing round the Tory Party, always liable to sting. The party should welcome it, because "you may be a wasp- but you're our wasp".

Government Spending Transparency Bill


Good title, George...

Let's face it, BOM has been grimly unimpressed by George Osborn's timidity on tax and spend. But now at last he's done something we can wholeheartedly applaud.

Yesterday he announced the Tories would be introducing a Government Spending Transparency Bill (see here for bill and also check out the accompanying Follow The Money website). It would be modelled on the new US Act just signed into law by President Bush.

Britain desperately needs this, which was why we proposed it just three months ago (see this blog, and our entry into Conservative Home's 100 Policies).

So hurrah! Doubtless our current high spending government will find some reason why we can't have it, but come 2010, we will expect it to be right up there on George's list.

Monday, November 13, 2006

Amateur Psychology


I'll show you!

Because his father beat his mother and he failed as an artist, Hitler tried to take over the world. We amateur psychologists all know that.

And this morning we hear that Richard Granger, the husky killer who is driving the NHS Supercomputer sledge over that precipice, hasn't spoken to his mother for a decade, and failed his computer studies course:

"His mother revealed that the man overseeing largest civilian IT project in the world failed his computer studies course while at Bristol University. He took a year off after the debacle and was only allowed to resit the exam when 62-year-old Mary Granger appealed on his behalf.

The retired teacher, who hasn't spoken to her son for ten years after a family row, said yesterday: 'I can't believe that my son is running the IT modernisation programme for the whole of the NHS. He was disappointed when he failed his computer studies course at Bristol. It was pretty serious, so I had to write to Princess Anne, who at that time was "university visitor" there to appeal for him to be allowed to resit the exam, as initially he was refused permission.'

Mr Granger passed the exam on a resit and eventually graduated with a 2:2 in geology."

Yes, I know it's not fair to dredge up the past like that. But this Big Swinging Dick could end up costing us tens of billions and leave us all at the bottom of an icy ravine.

Sunday, November 12, 2006

Recent Bonfires- 39


Is this really Lady Jane Grey?

In the news this week:

£1bn pa NHS drugs rip-off- "BRITAIN'S vital drugs cost £1 billion more than in all other EU countries. The NHS spends 22 per cent more than France and 28 per cent more than Spain. Critics blame the rip-off on the cosy relationship between health chiefs and the big drug firms - and urge NHS bosses to demand a price cut. Branded medicines make up more than 70 per cent of the NHS drugs bill of £9.25billion - so slashing prices to EU levels could save taxpayers £1billion." (People 12.11.06)

£12 grand nibbles for councillors- "PECKISH councillors and council staff munched their way through the equivalent of a £50 buffet spread THREE TIMES a week. Last year taxpayers footed the bill for almost £12,000 worth of finger nibbles and sandwiches... According to the information provided, the borough council spent £11,773 on buffets for 178 events between April 2005 and March 2006.Of these, 150 were devoured exclusively by councillors and staff at a cost of £7,758 - around £51 a pop. Just 28 were also open to the public, accounting for £4,015, or £143 each." (Welwyn & Hatfield Times 8.11.06)

£200,000 on another boonie for MEPs- "GLENYS KINNOCK, champion of the Third World poor, is to lead 70 members of the European parliament to a Barbados resort for a conference debating development and deprivation. During the five-day trip, costing taxpayers more than £200,000, the MEPs will meet politicians from some of the world’s poorest nations. Kinnock, who co-chairs the African Caribbean Pacific-EU joint parliamentary assembly, will be offered accommodation in the island’s exquisite hotels, including the Amaryllis Beach, Tamarind Cove and Turtle Beach. The assembly kicks off with a “project visit” next Sunday. According to sources at the Barbados embassy in Brussels, this is an EU euphemism for a four-hour chartered cruise aboard the Harbour Master — a 100ft ship billed as “the longest floating bar in the Caribbean”. (Sunday Times 12.11.06)

£1m on police killer's legal aid- "THE terrorist who stabbed police officer Stephen Oake to death has run up a legal aid bill that is about to soar over £1 million - while his victim's family have had just £13,000 in compensation. Kamel Bourgass, who murdered Detective Constable Oake during a raid on a flat where he was plotting a terrifying mass poisoning of Londoners, is launching a second appeal despite overwhelming evidence against him. Half the annual criminal legal aid bill of £1 billion goes on high profile cases such as terrorist trials. A Legal Aid spokesman said yesterday: "We are taking steps to reform the system." (Mirror 10.11.06)

Appallingly bad picture cost £100,000- "The National Portrait Gallery has bought a painting believed to be of Lady Jane Grey... It has been sold by an anonymous man from Streatham... But the gallery's purchase has been derided by court historian David Starkey, who said: "It's an appallingly bad picture and there's absolutely no reason to suppose it's got anything to do with Lady Jane Grey. But if the National Portrait Gallery has public money to burn, then so be it." (Guardian 11.11.06)

Total for the week- £1,001,312,000

Friday, November 10, 2006

HM Treasury Goes To Pot


HMT's nice little billet


Frankly I'm shocked.

No, really, I'm shocked.

We've just learned that last year alone, HM Treasury spent £14,000 of taxpayers money on pot plants. HMT! The guardian of the public purse since well before Gladstone.

They also spent £2m on travel for Gordo and his staff, including £755,000 on planet destroying airmiles.

Not to mention an extraordinary £173,599 on "cancelled conferences" for HMRC - how many cancelled conferences did they have for God's sake?

I can't help but reflect yet again how far HMT has fallen under Brown.

When I were a lad toiling at those high ancient desks, we worked by guttering candlelight, scratching out the public accounts on the backs of surplus departmental circulars with quill pens. The hacking coughs of consumptive Assistant Secretaries echoed through the fetid...

Well, OK, maybe not quite that. But the conditions were pretty spartan- lino on the floors, so cold you had to wear a thick jumper, and a canteen menu comprising just pork pie or curried eggs (a hangover from the War which I have never encountered anywhere else before or since). The only pot plants were those brought from home, which soon died on the permafrost.

But we were happy you see. Because we knew we were doing God's work- saving money for taxpayers. We were the roundheads fending off the wild cavalier urges of all those high-spending politicos.

And Brown inherited a Treasury that still broadly operated along the same lines. Yes, the public spending taps had been opened a notch under Clarke, but not imprudently. The restraint, the lino, and the cold of Great George St all remained firmly in place.

How things have changed now. Along with the biggest public spending splurge since that bloke who built the Pyramids, the old HMT has been swept away. Not only have they moved into a new atrium style open plan office (the old CSO building- pic above- refurbed at a PFI cost of £170m), but the whole operation has clearly undergone a psychology transplant.

Of course, the money's now run out. Once again, a socialist government has spent every last farthing and will leave us with a huge pile of debt. But this time, Bank independence means it can no longer be simply inflated away and will therefore hang round taxpayers' necks for years to come.

How will the new-style high spending HMT cope? Other that is, than simply racking up our taxes even more.

I have a very bad feeling about this. Better break out the thick jumpers now.

PS The figures also revealed HMT spent £178,000 on taxis. Pretty appalling, but according to my records, some way down the League Table of Public Sector Taxi Infamy: