Monday, April 30, 2007
At root, both hugely overestimated the ability of the state to deliver public services. Both believed that that if you pump in enough fiscal steroids, the grumpy old self-absorbed elephant can somehow be made to dance.
Wilson never did understand his mistake, preferring to believe he'd been blown off course by gnomes, politically motivated union men, and Gerd Muller. But after a decade of painful scar treatment, Blair does seem to be vaguely aware: a dim light may have clicked on.
This morning, Croney Falconer says:
"One of Tony's big regrets, I think, would be that we didn't realise quick enough that if you genuinely wanted to change the way the public service delivered for the public you needed to embark upon a process of cultural change. I think it is 99-2000 that he begins to realise that something more profound is required.
The cultural change, which seems obvious now, is you transform from it being a set process in which the public service deliverer is in the dominant position to it being much more driven by the particular needs of the person to whom you're providing the public service, which then leads you into giving to all the public the choices which currently only the middle classes have in relation to the provision of vital services like health or education. I don't think we even really clocked that agenda until four or five years on."
It's not a very bright light admittedly, but it is surely a light. The language of choice is not the same as the language of equality.
But the vital step is the next one.
Because while we can all agree that "cultural change" is a key condition for improving public services, in terms of practicalities, it's not really much help. Indeed, as the fatman observed, whenever you hear the word culture, best management practice is to reach for your revolver.
What Falconer is saying here is that if we could somehow achieve "cultural change", we could transform the way the public services work, and everything would be tickety. Which is of course like saying we could cure depression by making everyone happy.
In the real world, there is no known way of achieving cultural change inside Big Government. It's the nature of the beast to be top-down, producer-driven, and wildly inefficient.
Sunday, April 29, 2007
£77m nanny food flop- "The free fruit and vegetables policy for schoolchildren is under review after an independent report found that the initiative had failed to improve pupils' diets. A study to evaluate the £77 million School Fruit and Vegetable Scheme (SFVS), launched three years ago, discovered that it had "no lasting impact" on what children were eating and that when youngsters received free fruit and vegetables at school they were less likely to consume them at home. Just 27 per cent of pupils achieved the Government's target of five portions a day while only a third of children were even aware of the five-a-day recommendation. Critics described the project as "hopeless" and "badly run" and accused the Government of failing to implement the necessary educational backing to make the programme work. Professor Fergus Lowe, the director of the Food and Activity Research Unit at the University of Bangor and a Government adviser on food policy, said: "The scheme is hopeless and every bit of the research shows this." (Sunday Telegraph 29.4.07)
MP spent £50,000 in postal frenzy- "A leaked email written by a senior Parliamentary official shows that the bill for postage and stationery soared to a record high last year – and doubled last month as MPs rushed to beat a ban on unlimited claims... MPs were caught stuffing handfuls of pre-paid envelopes and stationery into their pockets, with large quantities disappearing two days before the curbs took effect. Many even used pre-paid envelopes – worth up to £1 each – to jot down notes and shopping lists, before throwing them in the bin. Labour MP Siobhan McDonagh, an aide to Home Secretary John Reid, spent nearly £50,000 on free postage and stationery last year alone. Immigration Minister Liam Byrne is in second place with £40,000... A Parliamentary insider said: ‘The abuse of this allowance is quite shocking. When they realised that these allowances were to be controlled, MPs literally went round filling their boots while they could. Stationery expenditure for the month was up nearly 100 per cent at over £126K, with postage at £370K against a normal monthly total of around £200K." (total annual cost £2.4m = 12 x £200,000; Mail on Sunday 28.4.07)
£1bn EU landfill fines- "When, in 1999, the EU decided to phase out the landfilling of waste with its Landfill Directive, this was always going to hit the UK much harder than anyone else, because we have traditionally put much more of our rubbish into holes in the ground than other countries. There was nothing intrinsically wrong with that, since it has been used to reclaim large areas of land that might otherwise serve no useful purpose... [but] under the directive, each country was set targets for reducing landfill, with hefty fines by the EU for anyone failing to meet them. By 2010 these will be £150 for every ton of waste by which a local council exceeds its target... the National Audit Office estimates that by 2013 we shall be paying £205 million a year in fines to Brussels. Within ten years those fines (again payable by council taxpayers) will have amounted to well over £1 billion in addition to the billions of pounds we shall be paying in landfill tax." (S Telegraph 29.4.07)
Friday, April 27, 2007
- the NBPA got £180,000 of our money last year, a doubling since 2003-04
- despite the fact that the organisation is a charity funded entirely with public money, no proper accounts have been filed since 2002-03
- it owes Greater Manchester Police £180,000 for a conference it ran (pic above)
- there are currently "no valid trustees"
I've just taken a look at what passes for the NBPA's annual report (here). The financial report is shocking in its inadequacy, largely comprising a whine about how the Home Office doesn't give them enough cash, and how they lack "a sponsorship champion".
Now you may say that the not-fit-for-purpose Home Office has got a cheek questioning the accounts of the NBPA. After all, its own accounts are so shambolic they were qualified by the National Audit Office.
But what we should all find shocking is the fact that a black police officers' trade union is getting any public money.
I had no idea I was being made to pay for this. Did you? I thought not.
PS As regular BOM readers will recall, this is by no means the first case of taxpayers being forced to fund trade unions. As we blogged here, Labour are giving the unions £10m of our money in exchange for their continued financial support of Labour.
- more fly tipping
- more garden fires
- more rats... and not just in government
All taxes have behavioural consequences: people don't like paying tax, and will go to great lengths to avoid doing so. We all know that: only nanny seems to sail on regardless.
Tobacco taxation is a salutary example. As the Chairman of BAT has just reminded us, punitive taxation of the foul weed has fostered a multi-billion global industry devoted to smuggling and counterfeiting. He estimates that it costs lawful tobacco companies £2bn pa, and taxpayers £12bn pa in lost revenue.
As we blogged here, HMRC estimates it costs British taxpayers about £3bn pa- nearly 1p on the standard rate of income tax- and others reckon the figure is even higher. Plus, it has unknown health consequences because many of the smuggled ciggies are forgeries made from camel dung.
Camel dung will be the least of problems once the bin tax gets going.
Thursday, April 26, 2007
Naturally, the Department of Health and Bliar dismissed the idea- "the system will use the most incredibly sophisticated doobries" etc. Even though many outside computer security experts say that gathering everything into big central databases is the very worst thing you can do: no known configuration of doobries is proof against your determined hacker.
And of course, even the most sophisticated doobries depend on having staff who are capable of operating them. But as we can all see today, the DoH can't even operate the most basic computer housekeeping that the rest of the world takes for granted:
Wednesday, April 25, 2007
Anyway, I've been perusing their new website (paid for by us), looking at who's got the top jobs.
Obviously, Clever Trevor - Best Man P Mandelson - came out of the power struggle as the very top dog (predicted here), but his fellow Commissioners are just as interesting. So far, there are 13 of them, of whom three are trade union officials, two are academics, three are civil servant/quangocrats, and three are NGO professionals. Only two seem to have jobs in the wealth creating sector, and one of them is an author.
Today, they reminded us what they do, as Trev proposed that supermarkets should be forced to employ more ethnic minorities through positive discrimination.
Well, he doesn't quite put it like that of course. He says:
"You cannot for example now, in an area where the population profile has changed very rapidly over three years, say 'We would like to attract Asian staff'.
I think that Tesco or Sainsbury's or anybody else who is in the business of serving a local community would like to have the opportunity to do that. To some extent, the framework we have at the present time prevents you from doing that quickly - to respond to commercial needs."
So in TrevWorld- far from being a burden- government regulation will actually help the supermarkets (cf this morning's blog). Just like that boot in the face helped Winston Smith and his fellows to find real freedom.
- NHS- productivity falling by 1.6% pa since Labour came to power and ramped up spending (see here- including chart above)
- Education- productivity falling by 1% pa since Labour came to power and ramped up spending (see here)
- Adult social care- productivity falling by 1% pa since Labour came to power and ramped up spending (see here)
When we last blogged it, we calculated that falling productivity in just those three areas is costing us over £2bn pa- cumulative. Over ten years that's £20bn plus. Or 6p on today's standard rate of income tax.
Yet despite that atrocious record in its own business, Big Government thinks it's quite OK to lecture the successful wealth generating bits of Britain on how to make money. And quite OK to spend billions more on rubbish programmes like Regional Development Agencies, R&D credits, and pointless philosophical speculations, supposedly to raise productivity, but actually just imposing an even higher tax burden on successful businesses.
We used to make dunces stand at the back with that cap on.
Today we put them in charge, let them spend 43% of our income, and lecture us on how to live our lives.
Tuesday, April 24, 2007
While there are important questions to be asked about the direction of robot technology, these have been obscured by considering “robot rights” that no scientists take seriously, the experts said."
Now we all know the £6.5bn pa DTI is a monster of waste, reportedly heading for dismemberment under Gordo (see this blog and this vid). But even by their abysmal standards, Robo-rights always seemed especially crackpot. As Noel Sharkey, Professor of Computer Science at the University of Sheffield, says:
“The idea of machine consciousness is a bit of a fairytale. I’m not certain it won’t happen, in the same way as when I was seven I wasn’t certain about Santa Claus not existing, but I was fairly sure.
We need a proper debate about the safety of the robots that will come on to the market in the next few years. Military use of robots is increasing fast. What we should really be bothered about is public safety.”
Robo-rights is one of more than 200 reports commissioned by Sir David King, the Government’s Chief Scientific Adviser, from Outsights, a management consultancy, and Ipsos MORI, the pollsters. It all takes place under the DTI's grandly styled OSI Horizon Scanning Centre (a "Centre of Excellence in Horizon Scanning").
Now, I don't mind them playing Isaac Asimov if they want to.
But wtf should I pay for it?
At least when IBM Chairman Tom Watson (pic above) famously predicted that "there is a world market for about five computers", it wasn't on taxpayers' time.
PS It's disappointing when you discover that it may not have been Watson who came up with that prediction at all, but a Cambridge Maths Prof. It's like that "billion here and a billion there" quote which was attributed to US Senator Dirkson, but actually seems to have been a misquote. Dirkson (reportedly) admitted: "Oh, I never said that. A newspaper fella misquoted me once, and I thought it sounded so good that I never bothered to deny it."
Monday, April 23, 2007
"There is a recent article in The Economist harshly and maliciously attacking the OECD and its Secretary-General. The Staff Association welcomes the fact that our Secretary-General communicated this article to the Staff of the Organisation, as well as his response and the accompanying relevant correspondence.
Several statements by officials with which we fully agree denounce the accusations made against our Organisation...." etc
Which is a little odd, given that the Economist attacked Gurría, not the OECD (other than saying its governance arrangements seemed too weak to handle somebody wishing to steer it into "dangerous waters").
It's also in striking contrast to the Staff Association at the World Bank, which far from supporting its beleagured leader, is calling for Wolfie's immediate departure.
Why the difference? Could it be something to do with the fact that Wolfie's been savaging staff perks and prospects, whereas Angel hasn't.
Nah. These people are far to public spirited to let avarice and personal ambition cloud their judgement.
PS Just as a reminder, the World Bank costs British taxpayers £1bn pa, while the OECD is a knock-down bargain at a mere £20m.
Their triumph involved a 3,000 year old Egyptian:
"The offer from the antiques dealer seemed too good to be true. He had a 3,000-year-old Egyptian artefact, a statue of King Tut's half-sister, which had been in his family for more than a century.
And although it was worth £1million, he was prepared to sell it to his local authority for a knockdown £440,000 so it could remain in his home town."
Er... sorry... home town? Surely those 3,000 year old Egyptians lived a bit further east than Bolton. Bradford maybe.
Well, guess what. It turns out to have been a fake, chiselled to order by a couple of octogenerians (no really) in some backstreet Bolton lock-up.
All you can say is that A Daley must have done a truly historic job on Bolton's puffed up local "leaders". At the time of acquistion, Councillor Laurie Williamson, spokesman on culture, came up with the immortal line:
'This latest addition will enhance Bolton's reputation as a cultural destination.'
Laurie... mate... I need to break this gently.
£440 grand. Laugh or cry?
I'm thinking of knocking up a couple of Rembrandts- painted while he was holidaying with the Dick Van Dykes in the Woking area. It's a documented fact that they shared the Presidential Suite at the Holiday Inn Express.
Sunday, April 22, 2007
£150,000 for envirocrime snoops- "A council is paying plain-clothes snoopers £30,000 a year to track down homeowners who put their rubbish out at the wrong time of the week or in the wrong place. The 'envirocrime' officers are employed to enforce environmental regulations and have the power to fine residents who 'offend'. Ealing Council in West London is spending nearly £150,000 on recruiting and employing four new enforcement patrollers to add to its 23-strong team that already monitors 'waste disposal' regulations." (Mail on Sunday 22.4.07)
Wrong army helicopters cost £150m pa extra- "The dismal story of how our Army in Iraq is given the wrong equipment continues. To carry out a range of vital tasks, from surveillance to providing air taxi services, its only helicopters are six Lynxes, designed for use in northern Europe, hopelessly unsuited to hot conditions and continually breaking down. Much more appropriate to the job in every way would be Bell 212s (known as Hueys), which are very much cheaper and more reliable, suited to the heat, carry more people and are used by the US, Iraqi and other armies... A Lynx costs £23,000 an hour, a Huey £2,000. At 100 hours a month operating time, this means we are spending around £150 million a year more than necessary, to provide our troops with much less efficient aircraft." (Sunday Telegraph 22.4.07)
£600,000 for bird-flu turkey firm- "THE turkey firm at the centre of the bird flu outbreak has been awarded almost £600,000 in compensation – despite making serious hygiene blunders. The Government authorised the payment to Bernard Matthews yesterday for the 159,000 turkeys slaughtered in an effort to contain the crisis in February. Yet it comes as questions continue to be asked about the company’s role in the spread of the disease. An official report published in the aftermath of the outbreak identified serious lapses in hygiene on the Holton site in Suffolk... Inspectors at the plant found a leaking roof, holes in a turkey shed made by rats, seagulls feeding on scrap meat and loose polythene bags containing waste liquid. But last month the Food Standards Agency announced there was “insufficient evidence” to prove the company had broken the law.The decision not to prosecute paved the way for yesterday’s payout of £589,356." (Express 20.4.07)
Scottish Executive spending £68m on ads- "Ministers are planning to spend up to £68m of taxpayers' cash a year on advertising campaigns, a sum that would for the first time outstrip Tesco, which spends about £67m... The entire Scottish advertising industry is worth about £480m a year, meaning the Executive will pump in anything from 10% to 14% of the total. But evidence is mounting that the Executive's numerous campaigns on television and radio have precious little effect. A £510,000 anti-racism campaign, which started in 2003, failed to stem an increase in racist attitudes. A review even found an increase from 21% to 25% over the course of the campaign in the number of people who believed that verbally attacking asylum seekers who get housing and benefits in Scotland was justified. Analysis of another campaign, this time directed at drug driving, found that many of the audience surveyed could not remember what it had shown or said. A recent £13m healthy eating campaign encouraged Scots to call a special hotline for advice. The line had so few takers that the cost to the Scottish taxpayer was £115 per call." (Scotsman 22.4.07)
Directgovkids "rights" site cost £2.2m- "Step aside MySpace: there is a new groovy website in town. The catchily titled DirectgovKids has been provided for children aged five to 11 by the Department for Education and Skills (DfES). The aim, according to the Government, is to help children "understand the society they are growing up in", and also, of course, "to support the UN Convention on the Rights of the Child and contribute towards meeting Every Child Matters targets". Thanks to this website, every British primary school child can now enjoy fun quizzes on "kids' rights" or vital lessons such as "How to win votes", and "Naming a police dog" which advises: "Snowflake: I wonder how many of you knew the term Snowflake is sometimes used among the Afro-Caribbean community in quite a different way?" However, some commentators are proving stubbornly ungrateful after it emerged that the project cost £2.2 million of taxpayers' money." (Sunday Telegraph 22.4.07)
Saturday, April 21, 2007
a) Country A has 34,250 junior doctors looking for training posts. There are 18,500 training posts. How many junior doctors will not find posts?
b) Each doctor costs the taxpayers of Country A £250,000 to train. How much money has been wasted if the surplus doctors are shipped overseas to work for nothing?
a) 15,750 junior doctors will not find posts (= 34,250 minus 18,500). The answer of 10,000 given by Sian Thomas, deputy director of NHS Employers, is incorrect.
Friday, April 20, 2007
Today the Economist takes a hefty swipe at the OECD, charging it's new(ish) head- Mexico's ex-finance minister Angel Gurría- with a whole catalogue of dodgy dealings, from employing family members, to extravagently pimping up his official residence. As the Economist notes, even the staid old OECD seems to have serious "governance" issues and "may be drifting into dangerous waters".
So rattled is Sr Gurría that he's made the staid old OECD issue a detailed and unprecedented rebuttal on its website. The same website that normally only carries news of the latest age-adjusted labour market participation analysis for central Europe. I reckon we can all draw the appropriate conclusions.
The UK currently contributes around £20m pa to the OECD. And its latest gesture to us was to put us in the international dock over the BAE Saudi bribes case.
Takes one to know one, as they say.
So if you're a hospital consultant, the best advice is to stay right here.
Of course if you're a taxpayer, you should be wondering why it is we have the most expensive salaried consultants in the world.
Just one word of advice: do not on any account allow anyone else to join in. Especially if they want to be your "customer". Trust me. Post Offices do not work once customers start getting in the way. They take all the fun out of it.
I'm reminded of all this because I've just read yesterday's National Audit Office Report on the Department of Health's disastrous pay deal for NHS consultants. The NAO seems somewhat at a loss to explain just wtf the DoH thought it was doing, giving all that money away and getting sfa in return. But I immediately recognised they were only playing Post Offices.
- Thanks to yet another Simple Shopper NHS "new contract" pay deal, hospital consultants got a 25% pay rise for doing less work
- Once again costs were wildly understimated- at least £715m vs a forecast £565m- which has contributed to the deficit crisis
The pay facts are summarised here:
Click image to enlarge
So since we now employ 32,000 consultants, the annual bill comes out at nearly £4bn pa (including employers' contibutions).
Good luck to the consultants, we say- who wouldn't take a deal like that if offered? But bad luck for us taxpayers. And as the NAO report makes clear, to savour the full grisly picture, we need to view the pay deal in its broader context.
Since 2000, the number of NHS consultants has soared by about one-third, from 24,400 to 32,000. And their paybill has doubled, from £2bn to £4bn. Yes, of course, that was all part of the Grand Plan to save the NHS. But guess what. While consultant numbers and pay have soared, their productivity has slumped.
The following chart shows output per consultant:
Now, the man from the BMA spent yesterday telling us that measuring consultant productivity is dashed tricky. And of course it is. But a near 15% slump in headline output per consultant in just 4 years kinda jumps off the page. And that's backed up by the NAO survey which shows over half of NHS consultants think the new arrangements leave them less time for clinical care.
Which brings us to Post Offices.
As with all the government's other half-baked NHS "reforms", this new contract was landed on hospital managements by the Big Chiefs in Whitehall and Westminster. There was very little consultation about what was practical, or even feasible, down in the actual hospitals.
Yet according to the DoH, the fundamental reason for giving all the extra pay was to get consultants to accept "job planning". By which they meant that for the first time since the NHS was founded, consultants would agree to have their work managed from above, by hospital mangers. Just like a real business. Sort of idea.
The theory was that consultants would sit down with their boss and agree individual work plans setting out what they were meant to be doing. Thus everyone could be sure it would fit with the overall needs of the business, and individuals could be subject to regular reviews and appraisals. Just like it says in the management textbooks.
But of course the real world isn't quite that simple. For a start, the theory assumes you've got managers who are actually capable of translating high level corporate wibble into meaningful job plans. Even when they get no practical help from the Big Chiefs. And second, it assumes the managers are capable of getting the staff to accept the top-down priorities.
In the NHS, neither of those assumptions holds. Thus, while the NAO found that most consultants do now have job plans, they are only plans in the sense of being forms headed "Job Plan". Their content is generally little more than a diary exercise where the consultant has recorded what he/she is already doing; they are not tools for articulating current management priorities and directing work.
It's Post Offices. The forms are all there- completed, signed, stamped, and correctly allocated to the appropriate pile. just like the ones you get with the Casdon 532. Great for shuffling around and looking "official", but totally useless for running a business.
The bottom line is that we taxpayers are now spending twice as much on consultants as we did in 2000, but we're only getting 15% more output. Working practices have not been reformed, productivity has slumped, patient care has not been improved, and "consultants' morale has been reduced" (NAO survey).
In fact the only positive outcome seems to be a pile of forms. Another one.
What a pity the DoH didn't just treat the hospitals to a few Casdon 532s instead. They could have got even more forms filled in, yet saved us taxpayers a packet.
PS The NAO report also contains an analysis of international pay comparisons for consultants. Ill blog that separately.
Thursday, April 19, 2007
Uncle Joe was far more candid than any of our present day Big Government chiefs would ever be, but the reality remains the same. To BG, we are all statistics. From health to education to criminal justice, individuals take second place to the statistical imperatives of top-down planning, targeting, and efficiency programming.
True, our own Big Government hasn't yet quite reached the stage of purges and gulags for those who obstruct The Plan, but its attitude to individuals and their rights is squarely in the Uncle Joe tradition, as graphically illustrated by two recent revelations:
- The secret and unauthorised removal of organs from dead Sellafield workers- so much for BG's employees
- The use of contaminated "skid row" blood for NHS patients, even though officials apparently knew it could be highly dangerous- so much for BG's customers
Can you imagine our old friends at Tesco getting away with something like this? Not simply killing employees and customers, but helping themselves to bodyparts and concealing the truth for years? Customers would desert the stores, Sir Terry and the entire board would have to resign, there'd be criminal prosecutions, Tesco's share price would collapse, and the whole enterprise could well go belly-up.
With Big Government it's just one more barely perceptible statistical blip on the road to serfdom.
Wednesday, April 18, 2007
Take the UN. Even ignoring our direct and substantial military contributions to UN mandated "peacekeeping" operations, we stump up around £700m pa for places at their Table.
Part of the package is a one month turn at chairing the Security Council (The Very Top Top Table). It's just come round, and the Horse Lady chose to use it for the Council's first ever debate on climate change.
Climate change? But surely the Security Council is supposed to spend its time addressing imminent threats to global security, not shooting the breeze about highly contested long-term eco wibble.
You'd think so wouldn't you, and the Chinese certainly agree. Their representative said:
“The developing countries believe that neither has the Security Council the professional competence in handling climate change nor is it the right decision-making place for extensive participation leading up to widely acceptable proposals.”
The Russians also agree. Vitali Churkin, Russia’s often-blunt UN Ambassador, advised Mrs Beckett to “avoid panicking and over-dramatising the situation. With regard to the UN Security Council, it should deal with consideration of questions that relate directly to its mandate.”
The trouble is of course, the Horse Lady doesn't really understand any of that stuff, whereas she does understand climate change. Well, "understand" is perhaps putting it too strongly, but at least she picked up no end of ecospeak during her days at Defra (yes, we know she made a complete Horlicks of that job too, but she must have absorbed the lingo).
In one sense of course, it doesn't matter: the UN is a spectacularly ineffective and corrupt gravy train, so you might as well spend the time wibbling about climate change. But it's still costing us £700m pa.
And when you add up the cost of all our tickets to all the various Top Tables we subscribe to, you come out with some truly eye-watering numbers. As well as the £700m to the UN, we give about £1bn pa to Wolfie's World Bank, and of course, the teeth grinding £6bn pa we hand over to the EU.
Yesterday the retired Lord Chief Justice told us the Sentencing Guidelines Council, which he used to chair, should operate like the independent Bank of England. It should be given a five year prison budget to manage:
"These are the resources that the Government can provide for the prison population and you must see that your sentencing guidelines achieve a prison population within those resources where the commodity of a prison space is used in the most constructive way.
What we know is that the more money spent on building prisons, the less money will go on rehabilitating and reforming prisoners.
We've got to make a proper assessment as to how much of the economy of this country should go to imprisoning individuals.
We have many people in prisons now who don't need to be there. We need to ensure that a prison place is reserved for those who really deserve it and need it."
Now, given that the Major and I are unpersuaded by his Lordship's legal credentials, you will understand why his foray into economics caused a certain choking on Cornflakes.
- Crime costs Britain something like £100bn pa
- 50% of our crime is committed by about 100,000 persistent offenders
- Of that 100,000, only 20,000 are inside at any one time, which means 80,000 are out and about committing more crime
- A prison place costs about £40,000 pa (although some places are much cheaper)
- It would therefore cost around £3bn to bang up the other 80,000 long-term
- Net saving to the economy, say, £40-50bn pa
You see, my Lord, what we have here is something we economists technically refer to as a no-brainer. The economic return on our £3bn pa investment in prisons is of the order of 1500%. Which, in case you don't realise it, compares favourably even with the projected return on those RipYourFaceOff private equity participation certificates recommended by your broker.
Yes, we know you'd rather see these people rehabilitated, and that you don't think prison does that. But sadly, down here on planet earth nobody has a clue how to do it. Economically speaking there's just no contest.
Tuesday, April 17, 2007
Much of the PAC's report is a record of the detailed evidence they gathered (including a letter from supplier Fujitsu damning their employee Andrew Rollerson, who shot his mouth off about the whole disaster earlier in the year- see here and here).
But PAC's stark conclusions (pages 5-7) could stand for every Big Government project since the dawn of creation:
- Meaningless delivery timetable- "The delivery of the patient clinical record, which is central to obtaining the benefits of the programme, is already two years behind schedule and no firm implementation dates exist"
- Shambolic cost control- "The Department has not sought to maintain a detailed record of overall expenditure on the Programme and estimates of its total cost have ranged from £6.2 billion up to £20 billion"
- No cost benefit appraisal- "The Department’s investment appraisal of the Programme did not seek to demonstrate that its financial benefits outweighed its cost"
- No delivery capability- "There is a shortage of appropriate and skilled capacity to deliver the systems"
- No user involvement- "The Department has failed to carry an important body of clinical opinion with it"
- Driven by technology hype not practical business needs- "The Programme has focused too narrowly on the delivery of the IT systems, at the expense of proper consideration of how best to use IT within a broader process of business change"
- Muddled responsibilities- "The Department should clarify responsibility and accountability for the local implementation"
- Failure- "At the present rate of progress it is unlikely that significant clinical benefits will be delivered by the end of the contract period"
*PS Tess was on BBC R4 Today this morning, wittering on again about the 2012 "budget" and how the costs have only soared because they found all that land contamination they couldn't possibly have known about previously, and how that huge Contingency Reserve won't be needed anyway so it doesn't count as cost (see the vid blog here). She sounded like a dame lashed to the wheel of some huge out-of-control juggernaut thundering towards the parapet of certain dismissal this summer. What a shame we can't all bale out at the same time.
Monday, April 16, 2007
Sunday, April 15, 2007
£2bn loss on gold sales- "GORDON BROWN... disregarded advice from the Bank of England before he sold off more than half the country’s gold reserves at the bottom of the market. Insiders involved in the decision have broken ranks after an 18-month battle in which the Treasury has blocked attempts by The Sunday Times to make public the official advice received by Brown before he sold the gold. They have revealed that Bank of England officials had serious misgivings over the chancellor’s determination to sell 400 tons of bullion in a series of auctions between 1999 and 2002, when the price was at a 20-year low. Since then the price has almost trebled, meaning the decision cost the taxpayer an estimated £2 billion." (Sunday Times 15.4.07; see also here)
£58,000 for staying at home- "An immigration judge involved in an alleged blackmail love triangle has been paid more than £58,000 for staying at home since a formal investigation began into his behaviour, it emerged yesterday. Judge Mohammed Ilyas Khan has been picking up a salary of about £9,000 a month since last September, when he was asked not to sit in court... The blackmail trial involved their former cleaner, Roselane Driza, and the disclosure that the judge had been employing her illegally. Ms Driza was convicted at the Old Bailey of... stealing two videos of a sexual nature from her lover, Mr Khan... one apparently... featured Mr Khan cavorting with a mystery blonde woman." (Telegraph 14.4.07)
Costa Del Dole Brits blag £190m- "BRITS living in Spain are fraudulently claiming £190million in benefits, it was revealed yesterday. The “Costa del Dole” ex-pats have been wrongly given taxpayers’ cash by the Government. Damning new figures show that £220million in income support, Jobseeker’s Allowance and Pension Credit was paid to people living abroad in the past five years. And of that, £190million was overpaid due to fraud, Commons answers revealed." (Sun 13.4.07)
Baths already £2m over budget- "Grand plans for the Kentish Town swimming baths boil down to an ego trip for local politicians.The latest row over the baths has been partly fuelled by the Town Hall’s refusal to put a limit on the money it is prepared to spend. The joke doing the rounds is that the baths will become an open-air pool: because there is no ceiling. But concerns are mounting that costs of the project – agreed by all parties to be “risky” – could spiral out of control. Current costs are estimated at about £25 million, more than £2 million above initial quotes. Conservative councillor Keith Sedgwick told a scrutiny committee last Tuesday that plans to refurbish the 100-year-old building were in danger of becoming a “monument to this administration’s ego”. (Camden New Journal 12.4.07)
Saturday, April 14, 2007
We were responding to the widely broadcast calls for British taxpayers to stump up £7.5 trillion to compensate descendants of the 3 million Africans whom our ancestors transported across the Atlantic and set to work on British owned sugar plantations in the Caribbean.
We argued that we should not be held accountable for the actions of our ancestors ten generations ago- however indefensible by today's standards- and we rejected the proposition that we are still benefiting from the profits via the funding of the Industrial Revolution. The historic evidence is that while the plantation owners got rich, the overall net benefits to Britain were relatively small, possibly even negative.
Following the blog, I received an invitation to take part in a discussion about it on the BBC. But having no wish to be painted into the BNP corner and ritually humiliated, I declined (see here for the firestorm that engulfed the world renowned economic historian Stanley Engerman after he published his revisionist text Time on the Cross: The Economics of American Negro Slavery in 1974).
I also received a number of heartfelt emails from the Caribbean. They all basically said that talking about an abomination like slavery in terms of financial returns betrays a total lack of humanity. A great wrong has been done, and financial restitution is the least Britain should offer.
First, slavery really could entail quite extraordinary brutality, and some of the accounts I've read over the last couple of weeks I'd rather not have seen. It's no wonder people today still get so wound up about it. True, my own eighteenth century ancestors were agricultural labourers being worked to an early death on subsistence wages in the West of England. But at least they weren't mere chattels (the men weren't anyway), they were not subject to routine beatings- and worse- from their overseers, and they had not been forcibly transported thousands of miles from their homes.
Second, the amounts Britain made from slavery overall really weren't that great. Even Prof Simon "History of Britain" Schama, who has written passionately about the evils of slavery, discounts the argument, pointing out that "the amounts available for reinvestment [from the profits of sugar] probably did not exceed something like 2 per cent of the capital ploughed into purely industrial undertakings" (History of Britain 1603-1776, p 427).
Friday, April 13, 2007
Local councils. Ah. They make money by taxing their customers, and then fining them if they have the temerity to require service.
According to the Times, under legislation introduced last year, local authorities from Birmingham to Cardiff to Medway are fining their "customers" for putting rubbish out at the wrong time. So far, fines total around £200 grand, but many more councils are now looking to jump up on the cart.
"A spokesman for Sheffield City Council, which issued 95 fines to householders because they put their bins out on the pavement to early, said: “The council decided to adopt this legislation last September but at first we tried to pursue a softly softly approach. We looked at the issues and tried to find solutions like alternative places for the bins. The fines are a last resort.”
Last resort? What he's saying is that having "looked at the issues", the council wasn't able to find a way of meeting their customers' requirements. But instead of then saying "I'm most dreadfully sorry, we've failed you; may we help you find an alternative supplier?" they said "well, bugger you- if you don't fit in with whatever crap service we choose to offer, we'll fine you".
Another local authority wallah gives us the truth:
'Paul Bettison, chairman of the Local Government Association’s Environment Board, said: “Councils are . . . working hard to reduce the amount of rubbish sent to landfill. The waste generated is increasing year on year. Unless bold reforms are made recycling rates will not rise fast enough to meet the EU Landfill Directive, councils will be fined and taxpayers hit in the pocket.”
Translation: pretty soon you'll be fined for daring to create any rubbish at all. And don't bother to complain, because it's all down to Brussels.
Meanwhile in another part of the gloomy public service forest, Durham police were called by neighbours to a teenage party that got wildly out of hand. Mummy and Daddy were away, and young Rachel's partying chums were totally trashing the house.
"Although obtaining a place at university has never been easier, most employers wised up long ago to the dilution of degree quality. As a result, winning a place at an institution that is respected by recruiters - and will lead to premium-rate employment - is becoming increasingly difficult.
As in most markets where there is chronic over-supply, buyers dictate the terms of trade. The Student Book 2007 warns: "Despite claims to the contrary, employers seldom regard universities or their graduates as equal; they use their own employment criteria. Many are fairly conservative and still prefer graduates from Russell Group universities." This refers to the group of 20 top research-intensive universities, so called because their first meeting was in London's Russell Square."
A few years ago, LSE researchers reckoned a degree from a Russell university was worth up to £22,000 more than a similar degree from elsewhere. The gap's probably even bigger now. Randall goes on:
"For many blue-chip companies, the list of universities from which they normally select is shorter still. The Sutton Trust, a respected educational charity, identifies the elite as numbering only 13: Birmingham, Bristol, Cambridge, Durham, Edinburgh, Imperial, London School of Economics, Nottingham, Oxford, St Andrews, University College London, Warwick and York. These institutions have the most exacting entry requirements, yet a majority of their courses are hugely over-subscribed."
As he says, the tragedy here is that Labour's headlong- and expensive- dash to reach its arbitrary 50% target for university education is landing a lot of Britain's kids with degrees that are worth very little in financial terms. But they still incur £15-30 grand's worth of debt.
I'm sure you'll be aware that there's very little quantified evidence to show that university degrees are actually much more than a signalling device- ie a piece of paper that has no value other than signalling to employers which people are likely to be a "good employees". One implication is that, while degrees make perfect sense from an individual's perspective, their overall value to society is highly questionable, and a lot less than most of the economic return studies suggest. The economic value ascribed to the degree is actually just the value produced by good people, who'd produce most of it whether or not they had a degree.
Or is that just me?
Thursday, April 12, 2007
With the Heaven and the Earth long ago completed, The Creator has joined the 200,000 (he reckons) other British ex-pats living in France. From where he's just begun blogging at With One Bound.
I'm wondering if he has his own vineyard, like a many-partnered ex-BBC type I know.
The Grumpy Old Sod's Law has a very promising title, and today's post comprises a Content Advisory. Which again is promising.
"The future lies in knowledge intensive businesses: pharmaceuticals, IT, financial services, manufacturing. They rely on Stem (Science, Technology, Engineering, and Maths) graduates and post-graduates. It is really important that we have a supply chain that is going to produce the numbers."
So they want us to pay pupils £500 a throw.
Now, we can all see the collapse in student numbers for hard subjects like science, and the surge of students into softer options like reflexology (see here for the picture in 2006). But cripes, we taxpayers are already shelling out over £60bn pa on education- surely we shouldn't need to pay bribes as well.
Much cheaper would be to inform pupils from an early age just how much richer they will be if they stick with the hard stuff. Spell out in detail that if they drop Physics for Media Studies, they're walking away from the chance to be hundreds of thousands richer over their lives.
Take this hourly earnings comparison from a recent Price Waterhouse report:
Click image to enlarge
It compares the average hourly earnings of graduates with different degree subjects, expressed as a premium over what people with just 2 A Levels earn. Top of the tree are medicine graduates on an average 44% premium (and this snapshot was taken even before the munificent new doctors contracts handed out by the Department of Health). They're closely followed by lawyers, on 39%.
Those of a free market disposition will be grinding their teeth and recalling how medicine and law are the two last bastions of Spanish practices Maggie never got round to sorting out. But park that, and note that both are hard subjects, along with engineering, chemistry and physics, which come next in the pecking order.
Arts subjects routinely come bottom of the pile, and the softer they are, the lower are the associated earnings. Indeed, PWC report that the earnings premium associated with an arts degree for men is actually negative- ie you'd be better off not taking the degree at all.
The report (along with this companion piece) contains a mass of interesting info, which ought to be invaluable for schoolkids thinking about their future subject choices and where they might lead. Here's another chart, expressing the same earnings data as a capitalised lifetime income benefit (blue bars):