Wednesday, October 31, 2007

Britain's Economic Interests


A Better World- we understand Britain's real best interests

What are Britain's economic interests?

No, it's a serious question.

Yesterday, commenting on the government's panicky decision to extend controls on Romanians and Bulgarians coming to work here, Danny Sriskandarajah, the IPPR's head of migration, said it was a classic example of the "politics of migration" trumping Britain's "economic interests".

He also says "the problem is not that there are too many immigrants; there are literally parts of the United Kingdom where unemployment is below what economists consider a healthy level".

Now, we understand the IPPR is an old fashioned left-wing Labour pressure group, but surely even they must be aware of the key economic facts the rest of us now recognise about Labour's extraordinary immigration surge (see this blog):
  • It hasn't made the average Brit richer- GDP per head may even have been slightly reduced

  • It has made labour cheaper for employers, by depressing the relative pay of low-skilled native Brits- that's probably helped keep inflation down

  • It has taken jobs from native Brits- depending on which particular shambolic set of government figures you take, either 1.1m or 1.5m out of the 2.1m or 2.7m new jobs since 1997 have been taken by migrants- over half, anyway

  • It has increased the costs of congestion in London and the South East, and it has jacked up house prices

  • It has imposed huge strains on public services, to the detriment of existing users

Clearly, there are some winners- employers and existing property owners among them.

But there are also big losers, including low-skill British workers, first time house buyers, and those who have to send their children to inner city schools coping with an influx of new foreign languages.

Overall, in economic terms, the average native Brit has gained nothing.

Zilch.

So we're left wondering precisely how Mr Sriskandarajah and the IPPR reckon this can be in Britain's economic interests?

From mercantalism, to tariffs, to national champions, to nationalised monopolies, to state planning, to industrial subsidies, etc, etc, it was established long ago that economic patriotism really is the last refuge of the special pleader. When it comes to real world policy choices, "Britain's economic interests" are rarely unambiguous: there will always be winners and there will always be losers.

The simple reason the CBI, Digby Jones, farmers, and the nanny and cleaner employing classes want continued mass immigration is so they can get cheaper labour. It's pure self-interest. But at least we can all see where they're coming from and draw our own conclusions easily enough.

The motives of the IPPR's trainee commissars are much more devious.

Fundamentally, they believe in a different world. A Better World. And the reason they favour mass immigration is not because they want to make us richer. Still less is it to help fat capitalists hire cheap labour. No, it's because they believe we already too rich Brits have a duty to share our wealth with those around the world less fortunate than ourselves. And one good way we can do that is to open our doors wide to economic migrants, who certainly do gain.

Now, you may or may not agree with that view. But either way, it's a moral argument, not an economic one. And we need to remember that.

The IPPR should be upfront. They should have the courage to make their case openly, and not conceal it with a load of guff about how mass immigration is in our own economic best interests. Because all the evidence says it isn't.

Pic: shows a previous generation of patriots. These days they'd work for a government funded thinktank or NGO. Or the BBC.

New Paternalism Meets The Real World


But you're not a real wizard at all

When Tyler Senior was a young man, he used to reckon the best thing to do with old people was to shoot them. Now he's not quite so sure. Still, he's bound to be bucked up by what one of the world's leading economists has just written:

"Consider the following scenario. Scientists determine that, following careful empirical study and the meticulous application of cost-benefit principles grounded in utilitarian ethics, men ought not to be allowed to live beyond the age of 86 and women beyond the age of 88. You can easily see how the utilitarian calculus would lead to this conclusion and policy recommendation. By the time people cross those age thresholds, they tend to be frail, infirm and doddery. Many no longer enjoy life and may even wish they were dead.

Because but few of these old folk still make a productive contribution as workers, home makers or child minders, they also impose a serious financial burden on the community. Many no longer pay taxes but are net recipients of government transfers. The medical expenses incurred by and on behalf of the very old tend to be high. In the UK, with its tax-funded NHS, the elderly impose a non-trivial health-tax on the rest of society.

In addition to the financial/fiscal burden imposed by the elderly, they impose negative externalities. They drive too cautiously and fail to make due progress; they slow down other pedestrians on busy streets and during the rush to catch a bus, train or tube. Their Zimmer frames clog up passageways and entrance halls. They also are at times not very pleasant to look at, especially when they take out their dentures in a restaurant. Finally they can be highly irritating, because they tend to bang on about the good old days.

A utilitarian paternalistic government would know what to do in this situation. It would rewrite the intergenerational social contract to include mandatory involuntary euthanasia at age 87 for men and at age 89 for women.


The week before my 87th birthday, I would receive a note informing me that in a week's time I have to turn up at my local NHS hospital to be humanely executed by lethal injection. Those who have served in the armed forces could opt instead to be executed by firing squad. The penalty for failing to turn up would (of course) be death."

That's taken from Willem Buiter's excellent Maverecon blog. He's 58 himself, so he's got another 29 years blogging.

We have of course met Prof Buiter before (eg here), and he's always good value. The snappy title of this particular post is Beware the Perilous Protagonists of Patronising Paternalism: Richard Layard, Julian Le Grand and the New Paternalism, and his withering fire is directed at the new "science" of Happiness Economics (see previous BOM posts, eg here and here).

As you will recall, Happiness Economics uses opinion poll data to "prove" more money hasn't made us any happier overall. Therefore, governments should intervene, by for example, taxing above average incomes more heavily. Buiter objects to such "totalitarian" policy prescriptions:

"Private actions can be nudged, influenced and incentivised by the state using any of the tools and instruments it possesses, for no reason other than that the state believes this to be in our 'true' interest.

Well, thanks but no thanks. I prefer making my own mistakes to having someone else, be it the state or another entity or individual, make the 'right' choices for me."

Amen.

Because when it comes to making choices it believes to be right for us, the state makes more mistakes than you or I would make in a hundred 87 year lifetimes. Consider just a few from today's headlines:

Drug addiction

To save us from ourselves, the state has chosen to outlaw a wide range of drugs. It has thus established a thriving black market. But the state has proved hopeless at policing the market and its attendant and lethal criminality. And our £40,000 pa prison cells are full of addicts driven to crime in order to fund their habit.

Meanwhile the state has set up a wide range of drug treatment programmes. They are wildly unsuccessful because almost all their clients have been bribed and cajoled to participate rather than making their own free will decision to kick the habit. Last year the National Treatment Agency (NTA) spent £384 million of our money treating 195,000 cases. The overall success rate is under 3%, so each success costs us £1.85m.

Schools

To save us making the wrong choices for our childrens' education, the state removed parental choice. It nationalised most schools. And the curriculum. And the exam system.

The catastrophic results are all too familiar. And nothing can be done. Although the £40bn pa school system is theoretically under the control of the state, in reality it's under nobody's control.

In desperation, Bottler is lashing out wildly, threatening the 670 schools that currently fail to deliver his target performance benchmark with closure (cf Stalingrad management of the NHS).

And what must they deliver? What's the high hurdle benchmark that schools operating under real parental choice might fail to reach? Why, merely that 30% of pupils must leave with five dumbed down A-C grade GCSEs. In any subject. At all.

Speed limits

To save us from killing ourselves and others on the roads, the state has imposed all manner of rigid restrictions, even on empty motorways. True, our road death rate is among the lowest in the world (see this blog), but it's no better than Germany where they famously have no fixed mandatory speed limit on motorways.

Most of us would drive sensibly anyway, but the state has imposed limits which even those responsible for enforcing don't believe or accept. Thus, we have the delicious case of Britain's most senior road traffic cop facing a ban for driving at 90mph on a dual carriageway.

Don't do as I do, do as I say.


PS Message for Tyler Senior- when you get your appointment note, just ignore it. There's no way the Life Fulfilment Executive (LIFE) will have any record.

Tuesday, October 30, 2007

They'll Take The High Road. Maybe




Alex Salmond says we should go our separate ways, with Scotland taking the oil. But would Scotland be any better off?

According to Tyler's fag packet, a fiscally independent Scotland looks like this (2006-07 figures- for derivation see footnote):

Domestic (non-North Sea) taxes: £40bn
plus
North Sea taxes: £8bn
equals
Total tax revenue: £48bn

With expenditure running at £53bn, that means Scotland takes the High Road carrying a £5bn fiscal deficit.

Which compares with its 8% GDP share of the aggregate £31bn UK fiscal deficit, coming in at £2.5bn. So net net, a fully independent Scotland is £2.5bn pa worse off. Or approximately 2.4% of its £106bn pa GDP.

That's by no means a disaster. But it does mean that even allowing for Scotland keeping its oil revenue, the rest of us make an immediate gain if Salmond gets his way.
Plus, of course, the oil is a fast depleting asset:




So, the rest of us would gain more from Scottish independence with each passing year. Which is why this time around we won't be calling on the Duke of Cumberland to persuade them to stay in the Union.

And why Salmond has to crack on: the longer he leaves it, the less saleable the whole deal will be to Scottish voters.

Footnotes: An independent Scotland's tax revenues and expenditure have been derived as follows: 1. Scottish income, council and business taxes are official stats. Other UK taxes have have been apportioned on the basis of Scottish Gross Value Added. 2. North Sea taxes (£9bn) have been apportioned on the basis that Scotland gets 90% (eg see here). 3. Expenditure has been allocated using HM Treasury's PESA regional split for the approximate 80% of TME covered, and population share for the remaining 20%.
UPDATE 31.10.07 Looks like Scottish voters have been running their own fag packet calcs: support for independence has just fallen to 23%.

Rudderless



The massed ranks of politicos and commissars are still apparently up there on the bridge, but the charts are blank, the instruments are dead, and the wheel isn't connected up to anything down below.

OK Number One, full ahead on the bin tax!

Full ahead it is, Sir.

No! Full astern on the bin tax!

Full astern it is, Sir.

Ah... no.... as you were, Number One, full ahead on the bin tax!

Full ahead?

Full ahead, Number One.... but full astern on school surpluses!

But Sir, didn't we just give the order for full ahead on school surpluses?

What? Well, never mind about that. Full ahead on drugs rehabiliation!

But Sir, I thought we'd found out it doesn't work. You remember- that foreign chappie who charged us £400m a year for a 97% failure rate.

What? Are you questioning my orders Number One? I'll have you flogged!

'Fraid not Sir- not permitted under EU Human Rights legislation.
"Ev'rybody down!"
[Cue sound of huge crash and canned laughter]

Immigration Shambles

So our clueless "government" has suddenly found another 300,000 economic migrants working in Britain. The news broke while the Immigration Minister, the brainy but lightweight Liam Byrne, was being interviewed on C4 News. He was giggling his way dismissively through Dave Cameron's long overdue pledge to cut immigration substantially, and he was completely blind-sided.

Did he not know about this latest numbers cock-up? Had the hopeless Hain at DWP forgotten to tell him new and wildly revised figures were being released? Or is he really that uninformed and unconvincing in real life? Either way, it's well worth preserving the vid for posterity.

The latest story is that an additional 1.1 million migrants have come to work here since Labour came to power. Which means that 40% of Labour's much vaunted 2.7m new jobs have gone to new immigrants.

We blogged the immigration numbers issue here. Once you delve into it, it's painfully clear the government has lost control, with an astonishing 2.2 million non-Brits arriving since 1997. And those are just the ones the government happens to have recorded.

What's more, 1.5m of them - two-thirds - were non-EU. So the tired argument Byrne wheels out in the interview about how we can't control inflows because of EU obligations is completely false. Again, does he know and is simply lying to us, or is he really that clueless? A difficult call.

And remember, all this migration has done nothing to raise GDP per head. Indeed, the most authoritative study we have (from NIESR- see previous blog) says it's actually reduced average incomes because the average immigrant does a low paid job.

One final thing on the points system. The way it works in Oz is that they set an annual target for economic migrants, with the places allocated by Department of Immigration and Citizenship using a points system. The targets are set by the politicians, and the DIAC is expected to hit them.

Thus despite what Byrne implies, limits (aka "targets") are a key element of the system. And they are under political control. Unlike our hopeless wasters, Oz politicians have had the courage to grip the problem.

PS In reality of course, Byrne is pretty bright ( Fulbright Scholar at Harvard). Which means he almost ceratinly understands the facts about the Oz system etc. It's just that he reckons we're all so dumb he can get away with telling us whatever seems convenient at the time.

Monday, October 29, 2007

On The Show This Morning...


A morbid and depressing display... funded by taxpayers


Meet Alison Goulding. She has "five tellies - including a £1,000 widescreen - a hi-fi, Sky TV, two Play-Station 2s and four DVD players. Her huge garden boasts a full-size trampoline, two sets of swings and FIVE mountain bikes.

She also has 8 kids from two failed marriages, and "her family pocket more than £20,000 a year in handouts, even though none of them has done a day's work this century. They pay NOTHING for their three-bed house, which boasts a new ultra-modern kitchen."

Alison, 38, lives with her lover Ian Hurditch, 40, in Beeston, Nottingham. Sadly, Mr Hurditch has an unusual back condition which prevents him taking paid employment. True, it did abate long enough for him to erect a new porch for their house. And it must have also let up enough for him to father Alison's ninth child, which she is now carrying. But paid work is out of the question.
Now you're in the picture, there are a couple of particular points we should highlight.

First, Alison's not at all grateful for the support we taxpayers give her: in fact, she's incensed we're so niggardly. Those £10 Boots gift vouchers we send each of her kids at Christmas? "Rubbish - you can't get anything decent for that from Boots."

The second point is that her kids are her meal ticket. Thanks to Labour's grandiose and half-baked plan to "eradicate child poverty", each one means big money.

And Alison is an expert on entitlements (no doubt assisted by the summary benefit rate card helpfully provided by her local authority). Right now, she's working to have one son diagnosed as "socially backward", which will mean she can cop a special £2,366-a-year handout. And she's trying to have another diagnosed with Attention Deficit Hyperactivity Disorder, which will deliver more housing points and force town hall chiefs to meet her demands for a bigger home. As she says:

"My sister has nine kids and the council gave her two houses knocked into one. Then she moved to Cornwall and the new council bought a private house for them. I don't know why they can't do that here."

It's as simple as that: the more kids she has, the more cash she gets:

"I love giving birth - it's always so quick for me. People say I should stop breeding but it's not their business."

Not their business? Even though they're the ones having to pay?

Wait... I'd better stop there because I can see the Major has blood foaming out of his ears again.

OK, let's remind ourselves of the big picture.

There are currently 5.4m people of working age who are not working but drawing benefits instead- ie being supported by us taxpayers. They cost us £16bn pa in benefit payments alone*, plus the further cost of lost tax revenue. And despite endless programmes and pledges to get them into work, their number has remained roughly unchanged since 2000 (see this blog on the hopeless New Deal).

The major benefits they draw are for unemployment (Jobseekers), incapacity, and lone parenting.

Traditionally, unemployment benefit dominated. But that's declined sharply from the levels recorded in the 1980s and early 1990s. These days, Government figures show that by far the most widespread benefit is Incapacity Benefit (IB), with 2.7m recipients.



Now, as everyone surely knows, many of these IB claimants are actually disguised unemployed. In terms of "incapacity" they are typically men with "bad backs", and women with "depression", both conditions which it is apparently impossible to diagnose objectively. And they are heavily concentrated in three weak economy areas- Scotland, Wales, and the North of England. Those areas together account for 50% of IB claimants, even though they only account for 37% of the overall population.

Precisely how many IB recipients are capable of work is unknown. In 2005, the Department for Work and Pensions estimated around one million, with Labour proposing they should somehow be found jobs (A new deal for welfare: Empowering people to work). On that basis the real unemployment figure- ie working age people who could be working but are claiming benefit instead- is around 2m.

That still leaves out of account lone welfare parents like Alison who could in theory work. Plus various other able-bodied groups included in the 5.4m total.

Overall, it seems reasonable to assume that at least half of these 5.4m welfare dependents could work- call it 2.5-3m who could be supporting themselves rather than sponging off the rest of us.

So why don't they?

Is it because there are no jobs?

At first blush, you might think that was a big part of the explanation. But after 15 years of economic growth, the facts say otherwise. For example, 0.7m of these people (14.4% of the working age population) live in London, where it is absurd to argue job shortage: indeed such is London's demand for labour, a net 400,000 immigrants have been sucked in over the last five years alone. A further 0.9m live in the East and South East, where the argument is nearly as absurd.

In Alison Goulding's area, the East Midlands, there are 0.4m non-working but working age welfare claimants (13.6% of the working age population). Yet in five years, labour shortage has sucked in a net 64,000 immigrants. And even in the supposedly severely incapacitated North East, there was net immigration of 13,000- taking jobs which could have been filled by locals.

Clearly there's something else going on here. And that something else of course is the curse of welfare dependency.

If Alison and her broken-backed boyfriend went out to work, by the sound of it, they'd be looking at the minimum wage: best case. On that basis, if they both worked a full-time 35 hour week, they'd gross a combined £20 grand pa.

But since they're already getting £20 grand pa net, why would they bother? After all, they've already got careers producing kids and knocking up porches. What's more, instead of going out on a cold wet morning to wait for the bus to work, they can sit at home in the warm watching the Jeremy Kyle Show on the big screen telly. Work is not a rational option.

Sure, you and the government can go on about how work is good for you, sets a good example to the kids, and gives you the prospect of a better future. But against Jeremy Kyle and a plateful of hot fudge sundae Pop Tarts, it's a non-starter.

Last week at the Public Accounts Committee, the DWP's Permanent Secretary was asked if the government's New Deal welfare to work programme would get better results if there was a bit less carrot and a bit more stick (see this blog). Predictably, he declined to answer the question, but he did admit that many benefits are "not sanctionable"- ie recipients can go on drawing them irrespective of whether they cooperate with attempts to get them a job. There are no consequences.
That's clearly barmy. But more fundamentally, it's barmy to have a welfare system that incentivises people like Alison to stay off work copulating and eating Pop Tarts.

And what life chances will any of her nine kids have? I think we know the answer- at best, they will become the welfare dependents and porch builders of the future; at worst, they will end up inside.

Let's take it as read that there is no magic bullet. But the current welfare system for people of working age is a social and fiscal disaster.

So what to do?

As a minimum, we should abandon the arbitrary and wildly unrealistic definition of poverty as 60% of median income, and revert to the traditional 50%. Nobody would starve at that level and it would hugely increase the relative attractiveness of paid employment. What's more, it would save taxpayers about £50bn pa, or £2 grand pa per British household (see this blog- £50bn equals abolishing Inheritance Tax and slashing 13 pence off the standard rate of Income Tax).

In addition, Frank Field's four key welfare reforms (blogged here) are all worth pursuing:

  • welfare benefits to be time limited, as under Clinton's reforms in the US

  • authority over welfare spending to be localised- closer to the coal face (again cf US)

  • incapacity benefit to be decided by local officials, not doctors, but current recipients to retain benefit for a year after finding paid work

  • immigration to be tightly controlled so more jobs can go to current welfare recipients already here

Painless? In the short-term, no. But nobody has come up with a real world alternative. And unless we implement a radical programme along these lines we'll find ourselves dealing with more and more Alisons.

And her kids.

All the way to eternity.


PS Yes, we realise there is another highly seductive approach, in the shape of the Citizens Basic Income. But sadly, Tyler still hasn't found a way of making the sums add up (see this blog). We must get him back to work.

*Footnote- do you think £16bn pa as the benefits cost of these people sounds too little? We do too. It is the figure calculated by the NAO, but against stories like Alison's it feels very light. We know there are around 3m households like hers that are workless and living on benefits. And if they all get £20 grand pa, that adds up to £60bn. Even halving it gives £30bn. We suspect the NAO has omitted some key items- we will investigate further.

Redbox Ripoff

Can this really cost £750?


"More than £50,000 has been spent on the famous "red boxes" used by government ministers over the past few years, according to an MP's survey.

Prices of the boxes, which are used to store government papers securely, ranged from £385 to £750 each."
(BBC: HTP Heather)

The biggest spender was the totally useless DTI - now the Department for Business - which spent £13,337.50 on 18 boxes, 740 quid each.

Why? The Depratment for Business "only" has seven ministers.

And why are we spending such ludicrous amounts on these small wooden boxes which seem to last no time at all? Yes, I know some are covered in roan deer leather, but again, why?

And what about security? You could probably break into one of those things armed only with a plastic knife and fork.

Compare that to the SHOCK-ALARM SECURITY LEATHER BRIEFCASE from Ralph Thomas of Austin Texas. For a mere £200 (special offer) that has all kinds of hi-tech security features. Under prohibitions imposed by Thomas Inc, Tyler is unable to list them all, but suffice it to say they include remote arming of a 30,000 volt whole-surface pulse electric shock. In the event of theft, the rightful owner simply presses a button on the master control to deliver a lethal force style shock to the thief. Now, what could be better than that?


We're confident that Mr Gomulka could negotiate a bulk discount, and Tyler would even waive his usual intermediary fee. The Simple Shopper should contact us soonest.

Sunday, October 28, 2007

Recent Bonfires- 82


Consultants don't do flood defences

In the news this week:

Defra blows another £1.1bn on consultants- "Vital flood defence funding was cut while ministers spent a record £1 billion on management consultants... Defra spent £140million on consultants in 2002-3, reaching £290 million in 2006-7. It has spent £1.1 billion since 2002. The bill is three times the amount the Environment Agency spent on building flood defences last year, despite warnings of severe weather that culminated in the this year's disastrous downpours." (Sunday Telegraph 28.10.07)

£87.43m on MPs' expenses- "Official figures on the annual claims made by MPs showed that parliamentarians recorded an average £10,000 increase in the amount they claim in expenses on the previous year. Each MP picked up an average of £135,773 to cover the costs of second homes, groceries, postage and office staff. The total cost of the MPs' expenses has risen by an inflation-busting five per cent to £87.43 million in the past year... The Cabinet's golden couple claimed more than £300,000 in expenses in the last financial year, including £30,000 for the cost of their "second home". The six-figure expenses bill was racked up by Ed Balls, the Children's Secretary and his wife, the Housing Minister Yvette Cooper. Despite typically spending the working week in London, the couple are able legitimately to claim that their "main home" is in Mr Balls's constituency of Normanton in Yorkshire." (Telegraph 26.10.07; see also the TaxPayer's Alliance here and here)

EU lobbyists bunged £0.5bn pa- "The European Commission pays out €800 million a year – more than half a billion pounds – to 10,000 lobby groups, such as Friends of the Earth. According to the environment commissioner, Stavros Dimas, this is necessary to remedy Europe's "democratic deficit" by ensuring that their voices are heard "at European level". How strange that Mr Brown and his colleagues seem so determined that our views on the EU treaty should not be heard "at European level". (Sunday Telegraph 28.10.07; see also Business Week 18.10.07)

£5bn lost to benefits fraud and error- "Benefits worth £500 million were paid out in error last year. In a decade, £5 billion has been lost through fraud and error. Prisoners, students and those with jobs and money in the bank have all enjoyed payouts to which they were not entitled. Since 1997, more than £17 million has been wrongly paid to prisoners, who are not eligible for many benefits during their incarceration. Students have received £33 million while those who are in hospital for the long term - and are not entitled to Jobseeker's Allowance or Income Support - were handed £10 million. More than £1 billion has gone in benefits to those who have jobs and are not entitled." (Mail 26.10.07)

Total for week- £6,687,430,000

Saturday, October 27, 2007

Ken Does Crossrail




Crossrail is supposedly going to cost us £16bn. But, as we blogged here, if you believe that, you clearly haven't been paying attention. Our guesstimate is £25-30 bn.

Taxpayers will pick up much of the bill directly, either via the Treasury or London Council Tax. But in addition, public transport fares in London will obviously have to rise sharply.

Well, we say obviously, but until last week, Ken reckoned Crossrail would have no effect on fares whatsoever.

Then as soon as Bottler had given the go-ahead, hey presto, he changed his opinion (see here and vid above). Suddenly fares were going to rise after all.

How odd. You'd almost think the truth had been kept from him until it was too late to turn back.

Poor Ken- being kept in the dark like that. It's not right.

PS Always remember that this mendacious buffoon was elected by just 16% of Londoners. But that's democracy I guess.

Friday, October 26, 2007

Ken Blows Gaff On 2012 Budget


Ken and financial advisor

Mayor Livingstone has now confirmed what we always suspected: the original "budget" for the 2012 Olympics was never more than a wild guess.

In attempting to convince us that the "budget" for his latest extravaganza, Crossrail, is robust, he blurted out:

"This is not like the Olympics where we made a guess because we were in a bidding process.''

So now we know. He and our idiotic "government" committed taxpayers to a multi-billion and open-ended bill on the basis of nothing more substantial than a guess.

The lack of professionalism is appalling. But more fundamentally, it is outrageous that they have so little regard for the people who elect them, and who are forced to pay their bills. It underlines once again why we should never ever believe a single thing they tell us.

PS As you may recall, when the revamped £9.3bn 2012 budget was announced in March, Livingstone described the Treasury's insistence on setting a £2.7bn construction contingency reserve as "breathtakingly ridiculous". But we now learn that £360m of it has already been drawn in just the first six months. At that rate it will run out nearly two years before the Olympics are staged.
(HTP BG)

Thursday, October 25, 2007

About Time

Dear Sir,

I resign
Yours etc


So Sir John Bourn has finally stepped down. And it only took five months from when it first became quite obvious to everyone else he had to go (last May - see this blog).

Still, now he's gone.

The NAO must never again find itself in a similar situation, so the rules must be changed.

Expense rules have apparently already been tightened. Good.

But there also needs to be a complete ban on any NAO staff accepting corporate boonies. As we blogged here, companies fund boonies purely to get traction and influence over recipients. It is wholly inappropriate for the taxpayers' auditor to accept such things. Bourn should never have fallen for the opera and the grand prix freebies, and going forward there should be a complete ban.

More fundamentally, there needs to be a normalised and open procedure for appointing and removing the Comptroller and Auditor General. Simply fixing the retirement age would prevent anyone holding the post for ever (Bourn is 73). But Parliament also needs a practical way of dismissing the CAG before then.

Currently, that's very difiicult. Because of the NAO's unique constitution, Bourn could not be removed except by an arcane procedure involving "HM The Queen on an address from both Houses of Parliament"- the address quite possibly needing to be written on ceremonial goatskin and conveyed by the Postillion-at-Arms riding backwards to the Palace (see this blog). That has to be changed.

Leading PAC member Richard Bacon has indicated the Public Accounts Commission is fully seized of all these issues and changes will be made. We'll see what they come up with.

Meanwhile, Bourn's deputy Tim Burr has taken over, but only until the reforms have been implemented.

The sooner the better.

PS At least we now know why Sir John wasn't at yesterday's PAC.

PPS The Major's just steamed in asking if Bourn's been paid off? A good question. Normally at 73 it wouldn't even arise, but given the NAO's arcane set-up we should assume nothing. Better do some more digging.

Update: Over on Your Right to Know, the indefatigable Heather Brooke points out Bourn is the first Whitehall head to roll from FOI. So he's made the history books.

New Deal No Deal For Taxpayers

Public Accounts Committee yesterday

How to get workshy spongers back to work and earning their own keep is one of the oldest problems in welfare. Indeed, it was the principal driver for the Poor Law reforms of the 1830s (see this blog and James Bartholomew's outstanding Welfare State We're In for details). Of course, those reforms were eventually reversed, and under the entitlement culture engendered by today's Big Government, the problem is more acute than ever.

Today there are 4.2m people of working age living in workless households. The vast majority are supported by taxpayers, costing us an estimated £12.7bn pa, including £3.4bn pa on benefits for lone parents (source: NAO Report). That's equivalent to nearly 4 pence on the standard rate of income tax.

Getting these people into work is generally called Welfare to Work, although NuLabour naturally branded their programme with an upbeat Newspeak title- the somehow familiar sounding New Deal.

Now, as taxpayers, we ought to be applauding the New Deal: get those spongers back to work and we could save a ton of cash. The trouble is, the New Deal doesn't seem to be saving us money at all. In fact, according to the NAO's report published in July, it costs us even more than just paying the benefits.

The following table summarises the costs and benefits for each of the ten (!) separate New Deal back to work programmes. "Net fiscal benefit per participant’ estimates the cost effectiveness to the Exchequer of the programme. It is based on the cost of the programme, minus the direct benefits to the Exchequer (such as increased tax receipts and reduced benefit payments when people move into work) and the costs of any additional in-work payments such as Tax Credits" (report para 5.3):



As we can see, only two of these ten programmes end up saving us money. With all the rest, the costs of running the programmes significantly exceed the savings we make. Hardly surprising when one of these programmes has cost £76,540 per job.

Looks like we could have saved ourselves the £6bn the whole deal has already cost (Report figure 1).

So what's going on? Yesterday, Tyler attended the Public Accounts Committee meeting that tried to find out.

The three mandarins on the griddle this time were led by the Department for Work and Pensions' Perm Sec Sir Leigh Lewis. On Tyler's mandarinsgoingtothedogsometer, he came across quite well- think David Starkey as an old-style Anglican bishop. But inside the Department he's apparently known as the Honey Monster. And you can certainly see the resemblence.

Honey or not though, in terms of the nitty gritty he cast very little light on anything. It soon became painfully clear the whole programme is the usual amalgam of wishful thinking and bureaucratic treacle.

Judge for yourself- here's Tyler's verbatim transcript:

PAC Chairman How the dickens can we be getting taxpayer value if the costs exceed the benefits?

Sir Honey Monster Ah well, we think there are many additional benefits which have not been quantified. Lower NHS costs, lower costs from crime, lower costs from global warming, lower costs from foot and mouth etc etc

Chairman How can you possibly know that?

Sir H Monster We've had three major studies conducted by the world respected University of Hugeimpenetrablereports. We paid them a large sum of money to write a load of stuff proving we're right.

Chairman Hmm. Well how do you know your New Dealers haven't simply got jobs they'd have got anyway because of the strong economy?

Sir H Monster Ah well, wibblewibblewibble... and the latest figure is 57.2%

Chairman Hmm. What about churn? Surely most of these people get pushed into a low grade job for about six months, then lose it, and then start all over again.

Sir HM There's absolutely no evidence to support that conclusion. Or more precisely, there's absolutely no evidence. The simple reason being we don't collect any.

Chairman Gah!

[Brief pause while the Chairman's nurse is summoned]

A N Other Hon Member: Sir Honey, since you last appeared bfore this Committee you seem to have been knighted. What on earth was that for?

Sir HM That is for others to judge

A N Other I see. Well, what about all these immigrants- surely they must be taking the jobs your crowd are after?

Sir HM I don't think that can possibly be the case. If I may say so, you are falling for what our economists call the Lump of Labour fallacy. It's well known that immigration boosts the economy (for an exposition of how most economists outside Whitehall now agree that mass immigration actually does take income and jobs from native Brits see this blog).

A N Other Why have you set up such a ludicrously complicated structure? The NAO report says that in Glasgow alone the local programme involves 125 organisations and 325 individual programmes, projects and services.

Sir HM Ummm... have you got any honey?


PS This was the first PAC meeting Tyler had attended for some time. It's good to see proceedings still take place in the grandeur of Committee Room 15, and still under the haughty monocled gaze of Joe Chamberlain. The only thing missing was the Comptroller and Auditor General, who for some mysterious reason wasn't there. Hmm.

Wednesday, October 24, 2007

Foreign Convicts Still Costing Us A Packet


The Major's preferred option- Vorkuta, Siberia

We've blogged the foreign prisoner problem several times (eg see here). And today we learn that the Prison Service has set up two dedicated prisons to accomodate some of them.

We currently have 11,000 foreign prisoners in British jails- one in seven of our prison population. At £40 grand a throw, that's costing us £440m pa. Actually, it will be costing more than that because they include at least 50 different nationalities, who will need all manner of translation services and special cuisine.

What's more, we need those 11,000 prison places for our home grown British villains. Thanks to Labour's bungling, we have far too few cells, so all kinds of dangerous thugs are being left to walk free. 6,000 prisoners have already been freed under the barmy early release scheme, and some other wild animals never get banged up in the first place (eg see yesterday's blog).

Of course, the other point to make is that this problem is another cost of Labour's open borders policy. The number of foreign prisoners has more than doubled over the last decade, with some nationalities much more likely to end up inside than others. The last time we delved into the numbers we found the largest groups comprised:

  • Jamaican- 1564

  • Nigerian- 890

  • Irish- 649

  • Pakistani- 444

  • Turkish- 294

  • Somalian- 284

In July, during his right-wing grandstanding phase, Bottler promised to kick out 4,000 by year-end. Which on my calculation, would leave 8-9,000 here.

As we noted previously, the Major's solution is deport where we can be sure the felons will be kept safely locked up at home. Where we can't, we need to do a bulk deal with the Ruskies to rent their underused correctional facilities out East.

PS I'm just listening to a BBC R5 phone-in on this very subject. The inestimable PAC member Richard Bacon is on. Mrs T can't stand listening to such phone-ins because of the drivel some callers come up with. But I'm addicted. It's particularly interesting when callers say things like "why can't we chuck 'em all out?" Well, because they might get tortured back home. "So what? They're foreign criminals, and they shouldn't have abused our hospitality. Anyway, that may be the only kind of justice they understand". Well, you should be ashamed to hold opinions like that. Anyway, the other point is that they may not get properly locked up back home- they might just get on the next plane back here. "Well, they wouldn't come back if we punished them first- eg castrate foreign sex offenders and then chuck them out". To which there was no real answer. Other than, we're not doing that whatever you may think. BBC phone-ins are getting more adventurous, but they still have their red lines.

Tuesday, October 23, 2007

Commissariat Customer Service Department


Uncaged animal still loose

Latest news from the Customer is King Campaign:

1. Voting customers

Ron Gould, the international expert called in to investigate the Scottish voting fiasco, reckons the customers- ie the voters- were "treated as an afterthought":

"The Scotland Office and Scottish Executive frequently focused on partisan political interests, overlooking those of the voter and the operational realities of the election timetable."

There are demands for the head of Douglas Alexander, the child-star Scottish Secretary at the time. But in truth, his performance is par for the Commissariat course. Customers simply don't figure on their agenda.


2. Paying customers

Paying spectators at the 2012 Olympics are to be banned from using their cars to reach venues, and instead will be herded onto cattle wagon style transports, at up to 800,000 a day. The roads themselves will be needed for important guests of the Commissariat:

"For two months around the Games, one lane on several key routes in London will be reserved for 80,000 members of the “Olympic family”. These routes, dubbed “Zil lanes” after the routes reserved for the Soviet Politburo cavalcades in Moscow, are likely to be policed by dozens of cameras and a team of enforcement officers."


3. Defenceless customers

"A paranoid schizophrenic who punched a 96-year-old war veteran in the face, leaving him blind in one eye, walked free from court yesterday after a judge ruled that detaining him was not in the best interests of the public. Stephen Gordon, 44, was captured on CCTV launching a savage, unprovoked attack on defenceless Shah Chaudhury after they bumped into each other on a crowded tram in south London." (Telegraph- pic above)


4. F***ed customers

Sir Richard "We're all f***ed, I'm f***ed, you're f***ed, the whole department is f***ed. It's the biggest cock-up ever. We're all completely f***ed" Mottram will be retiring with the biggest pension pot ever awarded to a public servant: £2.7m.
"Public-sector pensions cost taxpayers about £18 billion a year. Each family pays the equivalent of 91p in tax for public-sector pensions for every £1 they put towards their own retirement plans."

5. Angry customers...
...should in the first instance join the TaxPayers' Alliance. Unlike all of the above, it's free.

Sicko Health Check


You can't beat Wedgie for a bit of misty eyed romance


Michael Moore and all romantic lefties love the £90bn pa NHS. They wish everybody could have one.

Yet according to today's Telegraph:

"Britain has been branded "the sick man of Europe" after a Government report revealed a nation blighted by record levels of obesity, alcohol abuse, diabetes and smoking related deaths."

Fair comment- the DoH's Health profile of England 2007 puts us at the very top of the European obesity league, only a smidge behind Mikey and his Mexican cousin:



And as for drink, we're just about the only old EU country where alcohol consumption is rising.

Fags- second highest mortality rate. Teen pregnancies- the highest of any old EU country.

Man- we are sick, sick, SICK.

Yet all of these headline horrors are self-inflicted. Which, after sixty years of cradle to grave state healthcare and its associated high intensity nannying, is surely rather odd.

Isn't it?

Well, no, it isn't.

Britain is just about the only Western country that has nationalised, free at the point of use, tax funded healthcare. Which is probably why fat unhealthy Michael Moore likes it so much. When he finally explodes, he could get sewn back together free, all treatment paid for by the rest of us. He'd have absolutely no need to worry about the long-term consequences of stuffing his face.

Welfare dependency, y'see. Free healthcare does nothing for managing your waistline, nor indeed much else in life.

We can see that graphically illustrated in the DoH's English regional health stats (see table 1.1 here). On almost all measures, the problems are concentrated in the dependent regions of the North. They consistently score worse than the national averages for obesity, smoking, binge drinking, teenage pregnancy, and (un)healthy eating.

The report also underlines an important point about the results we've had from Labour's NHS money splurge.

They are forever telling us that although it's cost a packet, results are coming through in areas like cutting premature deaths from cancer and circulatory diseases. And indeed, such deaths are falling remarkably.

But they were already falling before the splurge, and the extra cash doesn't seem to have affected the trend. Moreover, other countrys that haven't splurged the extra dosh have nevertheless also experienced the falls.

Take for example, the DoH chart on premature mortality from all circulatory disease for males, aged under 65:



England has been on a steady downward trend for nearly 30 years, gradually converging on the EU-15 average, which has itself been falling. The message is that improvements have been driven more by medical technology - probably US-sourced - than by any special NHS achievement, still less the funding splurge.

None of which will convince misty eyed fans of Sicko.

But it should.

Monday, October 22, 2007

Immigration Number Shocks


Blair's first cabinet: they changed Britain alright

Warning: this is another long post with a load of numbers.
Following Friday's soiree, I've had a riffle through the large collection of papers being submitted to the House of Lords enquiry into The Economic Impact of Immigration (see their website here).

Labour's own cross-departmental submission got a lot of coverage last week, with Home Office minister Liam Byrne still insisting that immigration has made us all better off (eg see the Grauniad's account here). The truth, as regular BOM readers will know, is that while immigration is estimated to have boosted overall GDP- by £6bn pa according to Byrne- it has done virtually nothing for per capita GDP: higher output is simply offset by having many more mouths to feed.

But the other submissions to the enquiry contain some new (to Tyler) and truly shocking stuff.

How many have come in?
  • At least 2.2m (net) over the last ten years, nearly 4% of the population

According to official ONS data (see here Table 2.1 and here T1.1 and T1.3), over the decade to mid-2006, the UK population increased by 2.4m to 60.6m (up 4.1%). Of that, the natural "home-grown" increase accounted for 0.9m, with 1.5m coming from net inward migration.

But as BOM readers will be acutely aware, many British citizens are leaving. In fact, over the last ten years a net 0.7m emigrated. This chart (taken from Prof Rowthorne's paper) gives the overall picture:

Which means that the net immigration of non-Brits was 2.2m, or 3.7% of the starting population. That is a staggering change in population mix during a single decade. It far exceeds the fabled arrival of the French Huguenots 300 years ago, who increased the population by less than 1% over a somewhat longer period.

And remember- these are just the official stats: there are unknown numbers of illegals here (we could probably all identify at least one), so real immigration levels almost certainly exceed the official count.


Where have they all come from?
  • About 1.5m have come the Third World, not Europe

Although much of the recent focus has been on arrivals from the new Eastern European EU members, according to the ONS, only about 150,000 came from those countries. Most of the 2.2m new immigrants were from elsewhere.

0.7m came from the New Commonwealth, mainly Africa and the Indian sub-continent. A further 0.3m came from the old Commonwealth (Australia, Canada, S Africa etc).

And a further 0.9m came from "elsewhere"- ie not Europe, not the Commonwealth, and not North America (net immigration from the US was roughly zero). Now, your guess is as good as mine where "elsewhere" is- the ONS doesn't spell it out- but it includes for example 0.1m from the Middle East. And we know there are now large numbers of Somalis here- some experts suggest up to 250,000.

0.7m from the New Commonwealth plus 0.9m from "elsewhere" equals 1.6m mainly from the Third World.


Where have they all gone?

  • 75% have gone to London and the South East

According to the submission from Migration Watch, between 1993 and 2005, 65% went to London, and a further 9% to the South East. So while there may be hundreds of Poles in Lincolnshire's potato fields, there are hundreds of thousands of migrant cleaners, waiters, and free newspaper pushers crowded into London.


Has it made us richer?

  • No: overall GDP per head has been little changed by immigration

The most widely quoted study is still the one published by the highly respected National Institute for Economic and Social Research (NIESR) last year (and see their Lords submssion here). They reckoned that immigration between 1997 and 2005 had raised GDP by 3.1%. But since it had increased the population by 3.8%, GDP per head had actually fallen.

Why might that be?

First, because many of these new immigrants take low-skilled jobs which produce less than the average UK worker. High productivity investment banking immigrants are very much the exception.

Second, they displace indigenous workers who join the dole queue (eg see this blog on the problems in Slough where hungry incomers from Eastern Europe consigned existing Pakistani immigrants to an 18% fall in their employment rate in three years).



Who are the winners and losers?

  • Winners include the immigrants, employers, and existing land/homeowners; losers include low-skilled workers and first-time home buyers

We may pity the poor immigrant, but by and large, immigrants come and stay because they gain.

Employers gain because the can hire labour more cheaply. Which is why their spokesmen like Digby Jones and the CBI favour mass immigration. And why the nanny and cleaner employing classes of West London are also in favour.

Existing land/homeowners gain because the increased demand for housing- especially in crowded areas like the South East- ramps up the value of their asset.

As for the losers, low-skilled indigenous workers lose bigtime as incomers bid down wages and take their jobs. True the government's own submission to the Lords enquiry says the opposite, asserting:

"There is no theoretical reason why immigration need either depress native wages or increase native unemployment."

But that is an outright lie. As the NIESR study reminds us, every economics undergraduate should know the Stolper-Samuelson theorem, one of the basic tenets of international trade theory:

"This suggests that when a number of different types of factor of production (capital, different types of labour) are used in the production process, an increase in the supply of one particular factor of production will in the short term reduce the price of that factor of production."

OK, enough economics textbooks, ed. And OK, under certain conditions, the increased supply of labour might induce a long-term increase in capital investment. But you get the despicable lying picture.

Home-buyers, especially first-timers, are also big losers. As the submission from Migration Watch says:

"In the period 1997-2005 the number of households in England is estimated to have increased by 1.563 million of which 592,000 (37.9%) are migrant households. Over the same period the housing stock has risen by 1.336 million. The rise in housing stock has therefore failed to keep up with the number of households formed – the shortage is nearly a quarter of a million homes. With net migration at half the levels experienced between 1997 and 2005 there would have been no shortfall between supply and demand – this shortfall accounted for much of the surge in house prices experienced in the period."



Does immigration help the public finances?

  • No: additional tax revenue has been offset by additional costs

The government likes to argue that the public finances benefit significantly because immigrants generally arrive in young adulthood, after they've already incurred the costs of getting educated. We therefore get a "free" tax-paying worker.

Commonsense says that's rubbish, especially given the number of children immigrants then tend to have here. The average native British woman has 1.6 children. The average immigrant woman has 2.2. And the average Pakistani woman in Britain has 4.7 children (eg see here).

The submission from Bob Rowthorne, Emeritus Professor of Economics at Cambridge, considers this whole question in detail, and concludes:

"Past immigration into the UK has not in aggregate led to a significant fiscal burden on the rest of society, nor has it provided a significant surplus. It has been broadly neutral."

And reading the detail of the government's own submission, you can see the only reason they can massage their own figures is by not counting the children of mixed immigrant marriages as a cost of immigration (see para 2.2.7).

Another gross distortion.


Where to from here?

  • Future immigration to add a further 10-15m by mid-century

Migration Watch provides the following eye-popping chart:

So without further immigration the population would fall to around 58m. But net immigration at around the current rate of 200,000 pa will lift the population to well over 70m.

A scary prospect, especially with 75% of those 10-15m immigrants likely to settle in the already overcrowded South East corner. Just for comparison, the much vaunted Thames Gateway was planned to add just 100,000 new homes, although that's now been jacked up to 160,000, and Yvette Cooper has recently been babbling incoherently about building 3 million by 2020.

Conclusions

Having waded through these various papers, I'm stunned. I had no idea the issues were quite as stark as this.

Of course, we're all completely used to the idea that the government lies to us, and routinely makes up stats to support its case. But this is serious. Unless they can somehow grip this problem, swamping won't be in it- we'll be standing on each other's shoulders.

And I'm left wondering what's really going on? Presumably they don't really believe that stuff about increasing GDP, or even the stuff about boosting the public finances. So why don't they act?

Or maybe they do believe it. After all, in 2003, Home Secretary Bonkers Bonkitt told us that there was "no obvious limit" to the number of immigrants, and that without them "growth would stall, economic flexibility and productivity would reduce".

Why do we let these arrogant fools rule us again?

PS There's a mass of useful immigration info from the 2001 Census here.

At Your Service. Not.


Here is this morning's "public service" news:

Health
  • Commissars ignored hospital superbug- The Department of Health knew of a damning report into an outbreak of Clostridium difficile at a hospital trust in Kent more than five months ago and failed to act. A draft copy of the Healthcare Commission report was first received by the health department on May 3, yet ministers only intervened when the document became public in October. The outbreak "probably or definitely" killed at least 90 people. (Telegraph 22.10.07)

  • Big rewards for revolving door bosses- The health service paid out more than £38million in redundancy and retirement packages to managers during the NHS cash crisis. The average settlement for 124 board level managers was £308,000, handed out as cuts were being made to services... Many of those made redundant will have simply walked back into another job. Derek Smith, the chief executive of Hammersmith Hospitals NHS Trust is understood to have received a payout worth more than £300,000 when he was made redundant in June. Just two months later it was announced he would take over as interim chief executive at University Hospitals of Leicester with a £100,000 salary. (Telegraph 22.10.07)

Education

  • 69,000 excluded thugs allowed to return- Tens of thousands of children who physically assaulted their fellow pupils or teachers were allowed back to school last year. New figures, compiled by the Department of Children, Schools and Families, showed 62,670 secondary school pupils assaulted another child and another 8,240 assaulted a teacher. But just 2,000 of these violent pupils were permanently excluded from schools in England, making a mockery of Labour's pledge to improve discipline. (Telegraph 22.10.07)

  • Good schools punished- Good schools could be forced to hand back thousands of pounds every year under a new Government "tax" on prudent head teachers. Head teachers at some of the best-performing state schools in the country fear they will be forced to axe staff or raid library budgets to finance building programmes instead of tapping into their savings. One accused ministers of a "devious and unprincipled" attack on successful schools, which undermined claims head teachers had been being given greater freedom under Labour. Under the plan, any school with extra money at the end of the year will be forced to hand a share back to town halls... even if it is being saved for new buildings, playground improvements, sports facilities or drama studios. (Telegraph 22.10.07)

  • Get out if you possibly can- The middle-class exodus from state schools in London is speeding up, with nearly half of children in some parts of the capital now privately educated... In 2000 22.6 per cent of children in Hammersmith and Fulham were educated independently. Now the figure is 25.6 per cent. Other inner-London boroughs have seen similar shifts. In Wandsworth, the proportion in independent schools has risen from 15.1 to 18.7 per cent... Independent school fees have increased to an average of about £11,000 a year. (Times 22.10.07)

Regional Robbery

  • England now forced to pay for Scots' prescriptions- While millions of patients in England will still be expected to pay for vital medication, prescriptions in Scotland will be available free of charge within four years. The move was cited as the starkest example yet of the "unfairness" of the current funding arrangement, with English taxpayers forced to pay towards improvements to health care and education available only in Scotland. Scottish residents already have access to free eye care and dental check ups, free personal care for the elderly, extra central heating grants and a number of drugs deemed "too costly" for the National Health Service in England and Wales. As a result of plans announced earlier this summer, Scottish students will receive a free university education and pupils in the early years of primary school could soon be taught in class sizes as small as 18. (Telegraph 22.10.07)

Health and Safety Gestapo

  • Stamping out community events- Firefighters have backed out of a long-standing agreement to take down their town’s festival bunting because health and safety rules no longer allow them to climb ladders to remove it. The town council has insisted that Bedfordshire and Luton Fire and Rescue Service must go through risk assessment procedures, despite their expertise with ladders... In Clevedon, near Bristol, North Somerset Council told traders that lights could no longer be attached to lampposts or buildings, making a display unworkable. In Sandwell, West Midlands, traders were told that lights could not be hung across roads in case the cables broke. In Bodmin, Cornwall, the council faces a £1,200 bill to train two workers to test all 150 bolts holding lights or cables, using a cherry-picker. On top of that the council must cover wages and the cost of hiring the equipment, and shut town-centre streets while the work is done. In Dereham, Norfolk, traders face a bill of more than £10,000 for Christmas lights. Health and safety issues have contributed heavily to the cost. (Times 22.10.07)


Have a nice day.

Sunday, October 21, 2007

Government Regional Shambles


Hopeless low-grade waster on the job

File on Four has just broadcast an investigation into yet another shambles bequeathed to taxpayers by My Lord Prezza (listen again here). It's likely to cost us another EU fine running into tens of millions (cf the £436m EU fine for Mags Beckett's fiasco at the Rural Payments Agency).
This time it concerns incompetence at government regional offices. Each region was inflicted with one as part of Labour's plan for ruling us through a new regional quangocracy (see many previous blogs). Among other things, these offices are responsible for ladling out billions in EU regional support grants, and according to FoF their financial accounts are so shambolic, the EU has stopped the money and is likely to levy hefty fines:

"Six English regions were scrutinised over concerns over 'poor standards' of monitoring the spending of grants... the North West could be fined tens of millions of pounds."

Naturally the Department of Communities and Local Government denies everything, but nobody was prepared to be interviewed, so we can draw our own conclusions. Indeed, while FoF seems to have overlooked it, DCLG's annual report records deep in an accounting footnote a provision of £66.9m for EU fines (see notes 27.1 and 27.2). £66.9m is serious money, even for a department as wasteful and incompetent as DCLG.
A number of other interesting snippets:
  • A couple of the government's own regeneration grant schemes in the West Midlands (in Walsall and Aston) tipped tens of millions down the drain: the money never got through to local community projects, either being diverted into the local authorities' general spending pot (so much for "ring-fencing"), or being simply frittered away by hopeless low-grade wasters appointed to oversee things.

  • We've had £4bn of EU regional grants since 2001, including grants for restoring old railway lines, and grants for London, the most prosperous city in the EU. WTF are taxpayers being forced to pay for that?

  • The EU has got a brass neck fining Britain's hopeless bureaucracies for having ropey financial accounts- their own auditors have refused to sign off the EU's dodgy accounts for each of the last 451 years

(HTP R Jones)

Recent Bonfires- 81


My bonus is clearly in the national interest
In the news this week:

£53m bonuses for Treasury mandarins- "SENIOR civil servants in the department responsible for the tax credit fiasco have been paid more than £53million in bonuses. Nearly half the sum was paid in the last 12 months... Critics pointed out that the performance-related rewards were handed out as the tax burden on middle-income households soared and the Treasury-run tax credit system descended into chaos." (Express 20.10.07)

Olympics consultants have already grabbed £62m- "Olympic chiefs are facing fresh criticism over their handling of the budget for the London 2012 Games after the Olympics Minister Tessa Jowell admitted that consultants are to receive more than £60 million for their work on the project. The Olympic Delivery Authority spent £50.49 million in 2006-2007 and between April and July this year spent a further £10.7 million in 2007-2008. In addition, Jowell says, the Department of Culture, Media and Sport spent £721,266 in 2006-2007 and between April and July this year spent another £202,314." (Telegraph 18.10.07, htp The Daily Brute)

£22m bribes for failed asylum seekers- "Failed asylum seekers are to be offered up to £4,000 to go home voluntarily. The support packages - which can include help towards private school fees - are intended to arrest an alarming slump in the number of bogus refugees being removed from the country. The deal includes money for housing, childcare fees and even help setting up a business. There is also a cash payment of £500 at the airport. But the part of the increased package which provoked the most comment was the possibility that failed asylum seekers could claim money towards private school and university fees for their children. The total budget for the scheme - to be met by the taxpayer - is £22million a year." (Mail 20.10.07)

Idle Welsh quangocrats paid £2m pa- "FORMER quango employees are being paid around £2m a year without having been found a proper job by the Welsh Assembly Government... Around 70 members of staff are still waiting to be slotted in to new roles more than 18 months after three quangos were merged with the Assembly Government... “The whole thing has been ill-thought-out, ill-planned and quite obviously ill-delivered.” (Western Mail 17.10.07)

£20,000 compensation for barmy NHS psychotherapy- "A woman who falsely accused her father of rape after undergoing a discredited "recovered memory" psychotherapy has won a £20,000 payout from a local health authority. Katrina Fairlie claimed a hospital psychiatrist almost ruined her life after he extracted false memories that her father had sexually abused her. Miss Fairlie, who withdrew the baseless allegations months after making them, revealed during other sessions with consultant Dr Alex Yellowlees that she witnessed her father murder a child and named him and 17 other men, including two politicians, as paedophiles." (Mail 20.10.07)
Total for week- £149,020,000

Saturday, October 20, 2007

Old Labour- Badly Burned But Still Alive


New Labour wanted shot of them

Last evening we attended another extended family event. Over a traditional Home Counties vat of hazardous booze, Tyler fell into conversation with a couple of senior teachers from inner city state schools- a headmistress and a newly retired subject head.

It's always been entertaining chatting to them at family weddings and funerals over the years, because back in the Old Days, they were long serving Labour activists.

And in 1997, although they never liked Bliar, they were rejoicing at their brave new dawn after 20 years of hurt. They rejoiced that the depraved political ideas espoused by people like Tyler had been consigned to the dustbin of history.

What a difference a decade makes- these days, they have withdrawn to the political sidelines, ignored and angry.

So what do they make of Labour ripping off Tory tax policies? Need you ask?

It's a disgrace that those who had the extraordinary good fortune to ride the property boom (including themselves) should be allowed to pass on their undeserved gains to their children. It should be shared round so that society doesn't fracture even more between the haves and the have-nots.

OK, forget Bottler and the total bankruptcy of New Labour: given a clean sheet, what would they do about fixing state schools- those same schools that have seen a virtual doubling of funding since 1997, yet half of which, according to Ofsted, still fail to provide a good education?

No doubts at all- the first step must be to abolish private schools.

What!?

The articulate middle class must be made to share the same schools as the disadvantaged, so that they can demand more funding and all round improvement.

But what about the way schools are run?

A single word answer: discipline. Discipline must be returned to where it used to be: bring back traditional teaching and bring back the whack.

Anything else?

Well, mass immigration must be stopped. Schools simply can't cope with the ludicrous babel of languages now forced on them. Let alone the cultural conflicts.

Come to that, immigration is behind most of the social problems in the inner cities. Not just the obvious (though until last week, officially denied) pressures on housing and public services, but also the tensions between different groups
- one of these teachers reckoned there are over 100 languages now being spoken in his borough.

They talked of how large areas of London have been taken away from the native population, and how White Flight is gathering pace.

But hang on, wasn't it your party that threw open the doors and let in all-comers?

Not our party. Not our party any more. Maybe won't vote at all next time.

Now, let's be clear. These people are intelligent professionals, and probably not at all the sort of bull mastiff owning punters Margaret Hodge had in mind when she blurted out that many traditional Labour voters are turning to the BNP. But Tyler was once again struck by how small that step is for Old Labour.

Because Old Labour has been dropped into a void and is angry. The BNP might not have been its first choice of rescuer, but in terms of issues like immigration and "discipline" the appeal is obvious.

The BNP's democratic credentials? No real problem because Old Labour was never that keen on democracy anyway. For one thing, people selfishly seem to vote their own self-interest rather than what's best for society. And for another, as I was informed last night, the lumpenproletariat (sic) doesn't understand where its real best interests lie. It needs leadership and "education".

All very unsettling.

NB Tyler wishes to emphasise that these two teachers are related by marriage only- and that distantly. Nobody should conclude Tyler is related directly to people espousing views as extreme as those of Old Labour.