November 11, 2014
Yesterday’s lead article on the front page of the Financial Times was positively incendiary (“Osborne faces doubling austerity cuts to £48 billion a year to hit targets“). David Cameron wrote last month that most of the cuts in the austerity programme had been achieved, with ‘only’ £25 billion a year still to be removed from budgets, “but FT analysis has found that less than half the required reduction has been made.”
“The level of cuts is nearly twice the £25 billion estimate because that figure does not include planned cuts for two years out of nine – 2015-16 and 2018-19 – and takes no account of the effect on departmental spending of rising numbers of pensioners and increases in pensions payments. The Institute of Fiscal Studies last month criticised Mr Cameron for omitting the first and last year of the next parliament when calculating the size of the cuts to be made.”
The FT estimates that if the ‘ring-fence’ of health, education and overseas aid remains then the ‘non-protected departments’ face real cuts of 33% against the 21% cuts they faced between 2009-10 and 2014-15. Read the rest of this entry »
November 2, 2014
The Wiltshire FBU has written a detailed response to the ‘consultation’ on merger with Dorset Fire Service. It deserves wide circulation. Anybody interested in the impact of central government cuts should read it.
You can dowload it here FBU WILTSHIRE RESPONSE DOC
November 1, 2014
In the first 6 months of the financial year, from April 2014, government borrowing was £58 billion. In September alone it was £11.8 billion. Total government debt in September was £100 billion higher than a year earlier, at £1.45 trillion. By the standard of its own aims this shows the failure of the government’s austerity programme. What the economist Ha-Joon Chang calls the ‘economic fairytale’ of the coalition government is beginning to unravel. Events are catching up with them both on the political and economic level.
When it introduced its first budget in June 2010 the Office of Budget Regulation forecast for 2014-15 was
- Current account deficit of £16.9 billion
- Public Sector Net Debt of £1,284 billion
- Public Sector Net Borrowing of £37 billion.
Yet the 2014 March Budget forecast showed
- Current Account deficit of £67.6 billion
- Public Sector Net Debt of £1,395 billion
- Public Sector Net Borrowing of £95.5 billion
Since March the situation has deteriorated with the PSND already £56 billion over the forecast with only 6 months of the year gone. Read the rest of this entry »
October 29, 2014
Before 1990 local authorities were able to keep all the rates they collected locally, both domestic and business rates. Changing that was one of the means by which Thatcher imposed central government controls on local authorities. Writing in the Advertiser David Renard expressed the view that the debate on ‘devolution’ of power in the wake of the Scottish Referendum gave “a unique opportunity to investigate what Councils should do and how much we can prise from the distant hand of Whitehall”.
Fredrick Douglas, a campaigner against slavery, once said that “Power concedes nothing without a demand. It never did and it never will.” If anything is to be prised out of Whitehall then there has to be a clear demand. One such demand is that Councils should be able to keep all the business rates they raise locally. According to the Council Leader Swindon collected somewhere in the region of £107 million in business rates last year. However, the (non-education) grant we received was only £64.9 million. Read the rest of this entry »
October 18, 2014
A letter to the Swindon Advertiser
In response to Charles Linfield (“shoring up support”, October 8th) my letter did address the question of ‘devolved’ powers to England, but was cut, presumably for reasons of space. The simplest way to devolve power from Whitehall would be to give Councils the right to keep all their income from Business Rates. Before Thatcher’s assault on local democracy Councils had more control over their income. They kept all the domestic and commercial rates they collected, and then received additional money through the Rate Support Grant. However, Whitehall has progressively taken more control over local authorities.
The impact is reflected in what central government deigns to give us from the money raised from Business Rates. David Renard has informed me that the town takes in £107 million and the government funding assessment is £65 million. In other words they fleeced us of £42 million in one year. If we were able to keep all we take in there would be no financial crisis. Read the rest of this entry »
October 14, 2014
The Financial Times reported that Porterbrook, one of the three main rolling stock companies that own Britain’s trains, has been sold for an undisclosed sum. The company owns and manages nearly 6,000 passenger and freight vehicles which are leased to train operators such as Great Western Trains, South West Trains and Northern Rail.
Porterbrook has been sold to a consortium which includes an Australian asset manager Hastings, Canada’s Alberta Investment Management Corporation and EDF Invest of France. Porterbrook has been sold on a number of times since it was set up in 1994 when British Rail was privatised. At the time there were two other companies set up by the government, Angel Trains and Eversholt. Each received about one third of the rolling stock. Read the rest of this entry »
September 30, 2014
There was an interesting Financial Times editorial today on “the central fact of British politics, the fiscal deficit”. It bemoans the forecast that the (current account) deficit will be £87 billion this year, after 4 years of “tight fiscal policy”. This crisis “demands candour and big thinking from the main political parties” yet it is being met “by ambiguity at best and outright dishonesty at worst.” The FT is not very happy with the Tories who should be offering a contrast to Labour’s “delusion”.
“Instead they crow about an economic recovery that is yet to show up in the public finances.” Read the rest of this entry »