Friday, 27 April 2012

Services or lower taxes?

I went to a local town meeting where the county and district councillors were proud to show that they had either reduced their council tax or kept it fixed for another year. Now this is commendable in trying to save people money but does it?

The cost was 600 job loses, which have meant cuts to youth services, merging of planning services with a neighbouring authority and a loss of the more skilled and experienced council workers to be replaced by cheaper and less experienced staff. Is that really a saving?

Next the county councillor tells us that the budget for the year for road projects within the area is £10,000 but we can get some of that if we can find our own contribution. A new set of traffic lights is £40,000 so that is quite a contribution for the parish to make. So keeping the council tax at its current level actually just means shifting where you get the money from to the parish who you can then call names for raising their component of the tax!

Added to this they have drawn a circle of 3 miles radius around the local secondary school and said anyone inside can walk as it is safe. That is an hour walk - in all weathers and in the dark in winter along a road where we have had a fatal accident in the last 5 years. That is very safe and so parents will have to pay for their children to go by bus ... but after all the council tax didn't go up did it?

Lastly the dear district councillor said that the cuts did not affect services (despite her own admission five minutes before that they had lost the local expertise in planning and that she had grave concerns about merging services with the neighbouring district!). "Ten years ago you would have gone into the council office and seen one member of staff reading the paper, one on the phone to a friend and only one doing any work. Now they are all working all the time", she says.

Nice, very interesting as a friend of mine worked for one of the big four accountants and they certainly did not work all the time. He told me of the hours watching the fish screen saver in Windows. So that means no slack to take up emergency problems, that means no contingency and it means over-worked and over-stressed employees with poor performance. Besides wasn't her party and many of the current leadership group running the council ten years ago? So it was their incompetence that created the situation she describes. She cannot have it both ways.

Someone also pointed out that no council staff on more than £22k have had a pay increase for the last three years. All of this is putting off paying now what you will have to pay later. You will also have to pay much more because of the lack of investment in the infrastructure and degradation of service. This is a ticking time bomb waiting for the next lot of councillors when these self-congratulatory pensioners (who alll have nice nest-eggs thank you, as well as their council allowances) finally shuffle off into "retirement" from public service.

Thursday, 12 April 2012

Osborne's Charities

George Osborne has been "shocked" by seeing some of the tax returns of the rich. Some of the scoundrels have only been handing over 10% of their income in tax when they should be handing over about 1/3. This leads to two points for George to ponder:

  1. If they are cheating the system and hoarding all this cash then why did he reduce the 50% rate? His argument is that by reducing it to 45% he will induce the rich to invest and so promote growth through their entrepreneurial expertise. Now we can see they were only paying 10% anyway but we haven't been seeing any of this growth George expects. That is because they do not spend their excess income on growing UK PLC. They spend it on luxury German cars, multiple homes and foreign bolt-holes as well as off-shore accounts, in places like say Belize.
  2. How are they using charities to launder their money? Surely there are rules in place to make sure this kind of abuse does not occur. Legitimate charities have actually been badly hit by his recent budget where there will now be a cap on tax relief for donations at 50,000 or 25% of income. This might cost charities up to £1 billion.

Wednesday, 11 April 2012

Enter Karl Rove stage right

I have to admit I was surprised that Santorum quit the race before the vote in his home state. This suggests that he was likely to lose the state and so become unelectable. It was certainly too close to call from the opinion polls which have Romney ahead in one and Santorum ahead in most of the others.


What was more significant was the GOP big brass moving after the April 3rd primaries that were won by Romney and declaring that the point of inflection had been reached and now that Romney was clearly going to make it.

Rove on point of inflection
Rove and the 12 point gap

But is this true or is it a lot of spin from one of the masters of manipulation? It is clear spin, looking at the past polling data it is far from clear Romney would win Pennsylvania as Santorum was ahead in most polls and there was no big movement after that Tuesday. Romney has not built up significant momentum but he needs to if he is going to beat Obama in November and so the contest has to end now. So the focus can move to the fight against Obama.

What is in it for Santorum? A V.P. position? I wouldn't as he has been destructive to GOP party unity. Most likely he will be given some other government post like homeland security and fade away. It depends on how much shit Rove's guys have been able to dig up on him as to how much he will be able to bargain for. If Rove managed to score big we might never hear from Rick Santorum again.