The average GP in the UK earns £107,000.
Note this ad for a tax partner in London: pay range £110,000 to £180,000.
Who adds more value to society?
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Richard,
The GP obviously adds more to society. So the GP gets a sense of satisfaction from what he or she does. The tax partner, on the other hand, probably has a sense of fatigue, a wish that he or she did something more productive, more meaningful.
But a demand exists for both services. It is therefore right and predictable that the tax partner gets more to make up for the lack of a feelgood factor in his work.
How many lawyers or accountants have you met that would want their children to do the same job? Very few, I’d wager. Money for drudgery is how I’d put it.
I’m sure Bob Diamond say the same thing Paul
That’s a useless excuse – and I hope you know it
What the misallocation of pay shows is we have values screwed up in our society
Something the Taxpayer’s Alliance will never understand as they’re a value free zone
Richard,
I don’t see why its a useless excuse. It seems to me obvious that a wage is paid in accordance with a number of factors, but the main one will be the number of potential candidates for the role, and this will be a small number for a skilled position and an even smaller number for a skilled position in a tedious job. After all, how many kids say they want to be a tax expert when they are older?
A wage is not paid on the basis of social utility: otherwise a bus driver would be paid more than a football player and a street cleaner more than Jonathan Ross. But how do you determine “social utility”?
In the end, someone is paid what their employer is willing to give them. What’s the alternative: the state setting standard wages for everyone? Or a maximum wage imposed by the State? Or everyone on the same wage: “from each according to his ability to each according to his needs”?
Fundamentally, why should a GP be paid more than a street cleaner? They both do socially necessary jobs, and the chances are a GP had environmental or social advantages over the street cleaner that gave them an unfair advantage. After all, most street cleaners did not come from middle class households where education was encouraged, so why is it fair to give them a lesser wage than those with greater opportunities?
GPs earn what Government is prepared to pay them, whereas tax accountants earn what their customers are prepared to pay. Both work in a line of business that requires a lot of training. But I wonder if your comparison is appropriate? a GP is a generalist whereas a tax accountant is a specialist. If you were to compare with say a consultant with a private practice I think you would get a different outcome.
Paradoxical that your real gripe is with government meddling distorting markets!
Alastair
I’d call that ludicrous
Who is more skilled. The person you delegate the task to or the person who delegates?
GP’s delegate tasks. They do not refer them upwards
They deal with the real complexity and the decision making process – the interaction of symptoms and the resulting diagnosis – the so called ‘specialists are the technicians who pretty mechanically deal with the resulting problem
Now who is worth more?
Richard
Paul
You hit a nail on the head
I am one of those calling for a maximum wage commission
Richard
I guess moral judgements apart, the consultant is more specialised, has more training, and there are less of them. Couldn’t comment on your characterisation of what they do but I suspect it is inaccurate
As usual Alastair – wrong assumptions, wrong answers – and you’re good at that
Maybe on this one I have some knowledge
I must say my experience of GPs is that they are useless. I go to GPs all the time – I have three kids, one is always poorly. A GP does one of three things:
1) Prescribes antibiotics
2) Says its a viral infection and give it a few days to clear up
3) Refer it to a specialist.
Clearly a GP is more skilled than a specialist. They only delegate stuff like surgery to those unskilled surgeons because its really easy and boring and so 1st year at medicine school.
I must say, you’re on good form today richard!
It takes real skill to send a child home saying it will get better by itself – which it will (mine have never had antibiotics)
The risk is they’ve got meningitis
You’d sue if they had
Ever thought of that?
I’m not married to a Doctor, and don’t know many professionally, although my brother in law is a consultant, and some of my closest friends are Doctors of one sort or another, so I am aware of some of the subtleties. However I think that as accountants we are hardly qualified to comment on the relative merits of consultants and GPs.
Personally I think your central point about the relative worth of tax accountants and doctors (of whatever flavour) is highly objectionable.
Alastair
You mean to say that as an accountant you think we should have no opinion as accountants on issues of value and pay
How utterly absurd
Richard
Fine – so define value in this context. Where you are at is not quantifiable. It is a value judgement that has no absolute. And your judgement is coloured by your world view that tax avoidance is morally wrong. Given that you think that is something that tax accountants do it is not surprising you think they are overpaid.
How absurd is that?
Far from absurd: it is moral judgements that inform the processes that mean we define some activities as legitimate and others aas not i.e. some as being transactions we allow and others not. In that case, how absurd is it to argue otherwise?
And how absurd is it to argue that an accountant should have no opinion on the issue?
And how absurd is it that you (and others who have commented) have not commented on the deliberate miststatements of reality by the Mail and Taxpayer’s Alliance that gave rise to this discussion?
by “we define” you mean “you define”. I trust you are not suggesting the “we” do not allow tax accountants to ply their trade.
I took the discussion to arise from your original blog about the relative pay of GPs and tax accountants – but now I am intrigued. Whose reality did the Mail and the TPA mistate?
BTW I get that you don’t like the TPA 😉
Alastair
I think you’re an accountant
And it appears you can’t spot the difference between turnover and net profit
That’s pretty scary
But probably says a lot about why you make the comments you do here
Richard
Interesting one. Personally, I am likely to find far more usefulness out of a GP than a tax partner. But then again, if the tax partner wasn’t making such enormous sums then there would be less tax revenue out of which to pay the GP. Furthermore, accountants are such boring people doing such boring jobs that you’re prepared to not begrudge them earning a little more just out of sympathy.
One thing I noticed at university is that a lot of my friends who were medicine students were actively pursuing jobs in medicine precisely because of the financial rewards rather than through any sense of duty. It is clear that many medicine students now see, correctly, General Practice being a well-paid career choice.
I’d also point out that the BMA is just essentially a giant trade union(an extremely powerful one at that – and one of the few unions who survived the Thatcher reforms relatively unscathed) who will do anything to protect its members’ interests. Polyclinics, for example, were shelved in the face of opposition from GPs fearful their turnover would decrease, despite the pathetic protestations to the contrary. GPs will always veto government reform if it adversely affects their bank balances. As Ken Clarke famously once told the BMA conference, “Why is that every time I mention the word “reform” you reach for your wallets?” In this respect they are no better than the Law Society or ICEAW.
As you once had an accounting practise and are now a tax consultant, I hope you practised what you preach.
Did you limit your Earnings to that under GP’s or bus drivers in your area out of interest or is it just words for others?
How about all the money from the sale or your practise?
a) GPs, yes
b) Bus drivers no (can’t see the relevance either)
c) Sale paid for the sabbatical that gave rise ot TJN
Now, what’s your problem?
You see, you know when people have no argument because they go something like
“oh if your such a socialist why don’t you give all your money away.”
Good. Incisive.
Richard – its a poor argument if you have to resort to stupid offensive comments
Make sensible comments then
I think we are all agreed that there should be a maximum wage and it should probably be something like 20% more than we or our spouse are likely to earn.
Another reason for tax reform. The best brains in the country are squandering their talents on work-arounds of the tax legislation. What a waste of human resources.
I’m sorry to have to say that my view is that GPs are VERY overpaid. My reason for saying this is family experience (not my own as I have been lucky enough not to have needed to visit one in over 30 years) of the quality of service provided, which is (I am not exaggerating) almost universally useless. At least most tax accountants get the “right” answer (and on a very few occasions are sued when they don’t). My experience of GPs is that anything more complicated than a cold or flu is quite beyond their competence. My sample size is about 10 city centre practices. I honestly despair at the competence of the doctors my family have experienced.
My wife now visits doctors in her home country of Russia whenever she can if she or our daughter have a problem (not a country that has a renowned healthcare system) and gets universally excellent treatment there – several times clearing up the misdiagnoses, misprescriptions etc she has had from the NHS. My sister in law is a doctor trained in Russia who says that her own experience of GPS in a different part of the UK is the same – useless. She visits them not for diagnoses (you might as well stick a pin in a medical dictionary) but only to get prescriptions
So, as I don’t think useless bankers should be paid highly, I don’t think useless GPs should either.
I’m sure your wife is excellent Richard, but my experience is that ALL the GPs we have consulted are at best useless, and sometimes dangerously incompetent.
This is an argument that can be twisted so many ways. Is there anyone anywhere who would say that a nurse isn’t worth more when compared with the earnings of say a Chelsea footballer or a Robbie Williams ? We all know who does the most valuable and essential job, but the sportsman and the entertainer make a fortune because its a fact of life that earnings are based on supply and demand, and in a free market the employee earns relative to what his/her particular talent can generate in monetary terms. If nobody bought Robbie Williams’ records or would pay £100 to go and watch him in concernt, and if nobody was prepared to pay £100 to watch Chelsea or to pay a monthly Sky Sports subscription, then their earnings wouldn’t exist.
A tax partner is no different. Who pays his fees ? Clients, who agree an hourly rate when engaging him. If they weren’t prepare to engage him on his terms then he simply wouldn’t have any fee income. There are enough people out there to pay him, so the demand exists and he is supplying the resource at the free market rate.
Nurses choose that particular vocation in life. They knew what it paid when they chose that route. Its the same with any profession, and applies equally to nurses, GPs and medical specialists as well as tax consultants. Nobody forced them into that chosen career, and how many of them would refuse a better opportunity in entertainment or sport if they had the talent and the opportunity to follow those careers instead ? I would wager not many.
If the high demand didn’t exist then the high earnings potential simply couldn’t exist either.
personally I think no individual is worth any more or any less than any other individual. what they choose to do with their life, and what they earn as a result, is purely a matter for them. I fundamentally disagree with the idea that Society has a better idea of the worth of what individuals do.
Rupert,
What you states is also exactly why unions are outmoded in the modern world. A worker should be paid according to his productivity. The idea that all people doing a job should be paid the same and that should be centrally negotiated by a union means that no worker ever has an incentive to go that extra mile because there is no element of his pay that is discretionary.
And this is one of the reasons why sickness in the public secotr is always materially higher than in the private sector: because there is no motivation to work hard, or indeed to turn up at all.
I don’t have a problem with government setting a minimum wage but after that, all wages should be a matter for negotiation between the worker and his employer. That would encourage workers to aspire to excel and achieve their potential, and to earn more.
Paul
Please then follow up by the banning of all published prices in shops
We must all be free to negotiate our own price to its optimal level
Your logic is complete ideological nonsense: as an employer I thought the plus of having a union was significant: it saved me individual negotiation when it was unnecessary – without constraining me when I desired to promote
Roger
Rather oddly there are quite a lot of Russian GPs here now
They are good at offering diagnoses: the problem for the punter is any one can diagnose – people do it all the time for themselves on the net now – but the reality is they may not have the condition
I’m not for a minute defending bad GPs – there are many – as many as there are bad accountants – but good ones know when there is no diagnosis – as is true in at least 30% of cases becasue medical undertsanding is limited
That’s when a good GP really comes into play – in managing the resulting uncertainty
That process is the raison d’etre of medical general practice. Trouble is the government pays for processes it can count. The result is a service incentivised to do the wrong thing because some market based management consultant thought that was ‘productivity’
Actually it’s madness
Something that is, I understand, rather hard to diagnose but easy to spot
Richard
Hi Richard, have you never tried negotiating. The ticket price in a shop is no more than an invitation to treat! You should try it in Tesco’s some time – hours of fun 😉
Richard,
I think that highlights the problem. Irrespective of anybody’s subjective evaluation of worth, the accountant has a strong financial incentive to provide the desired service to his/her customer.
GPs, on the other hand, have very little accountability to the patient, have few financial incentives and the ones they do have direct them to serve the government’s demands rather than the patients’.
Alastair,
If you didn’t shop in Tesco’s so much you would know most things are negotiable. Cars, houses, holidays, jewellery, food from markets, professional fees, builders, electricians, all sort of tradesmen, anything bought in bulk.
If you deal with somebody that has a financial interest in their business, you can negotiate with them. The world doesn’t have to be made up entirely of big businesses at war with unions. And I don’t believe we should support such businesses or such unions. Small an local is the way to go.