My National article this morning:
And, just in case you won't go there, the four things are:
- A government committed to the rule of law, which will now take some effort to re-establish.
- A level playing field, which means investment in HMRC so that cheats pay their taxes.
- Investment in social and physical infrastructure that is crumbling before our eyes.
- Reintegration with Europe.
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I tried to watch the programme on Starmer last night on ITV.
I held on manfully until the coverage switched to a ‘shadow cabinet meeting’ and I saw the perennially pre-pubescent Wes Streeting nodding approvingly (perhaps Starmer has passe wind or something) and Reeves doing her best to look intelligent ( plus some non-entities in the party I’ve never heard of before) and I bottled it and turned it off.
It was bad enough seeing people interviewed still seeing the Tories as something they would vote for, never mind the faux concern by the presenter/interviewer when Starmer was talking about Mummy and Daddy.
This was not politics; this was an attempt at a shoe-in.
Awful.
I did not try
Thanks for the heads up, I was going to try and watch that tonight.
Unfortunately Starmer hasn’t got the balls to acknowledge Brexit for the shit-show it is & campaign for UK re-entry to the EU
Starmer painted himself in a corner with Brexit, because he used it as one of the means to undermine Jeremy Corbyn.
In effect he threw the country and it’s potential better future under the bus for sectarian advantage of the hard right ( let us be honest in naming them) in the Labour party.
I was not aware that the pantomime season was still running & that some shows were televised.
Reverting to Reeves and UK a good place to do business – I’d suggest that it already is – for big business (of all types)
At one point during the select committee hearing that I was at – Vicky Ford (tory) asked about community engagement (ref renewables etc). The two suits from Statkraft (prop Norwegian state) and Island Green power -(who they?) wittered on – the usual flim-flam. I responded with one word: Denmark. By law RES developers have to offer 20% fo the equity of a project to locals. The body language from the two suits was interesting – and Statdkraft-man said it would be very difficult – the expressions from the MPs (including Ford) was one of distain – big business wanting it all & wanting it now. Note it was a large state-owned corp acting just like any other rapacious profit maximising entity. In fairness, bonuses would be endangered if, for example, locals were “given a piece of the action” – thus Statkraft-man’s reaction was to some extent understandable.
The Uk is already “open for business” which begs the question – how does Reeves propose to make it more open? & perhaps even more explotative of UK serfs?
Matthew D’Ancona had an article in last week’s TNE about Davos. It was titled ‘The karaoke moralists of Davos shrug as the fire they lit burns up the world’.
He doesn’t hold back in his criticism. In summary, Davos Man, as he puts it, has championed stakeholder capitalism as a means of pre-empting government regulation; as a substitute for the the public making use of democracy to fairly distribute the gains of capitalism, which has led to widening economic inequality and intensifying public anger i.e. the populism and nationalism we now see everywhere.
He finishes by saying the most helpful thing these self-regarding masters of the universe could do is abolish it.
And Reeves just has to be there? [;
I admire your work and your remarkable productivity.
The Prime Minister is emphatic about the supposed ‘unaffordability’ of increased public sector pay. Are opposition politicians like Rachel Reeves any different?
Popular commentators such as David Aaronovitch, anchor in Radio 4’s ‘The Briefing Room’, posed the question: Why is local government in such trouble? (18 January 2024).
An excerpt after 23 minutes of the 28-minute programme: “Taxation can’t go up because we are now seen as over-taxed … and the government can’t borrow much more money …” The title ‘Briefing Room’ gives the impression that they know what they are talking about. While the presenters are intelligent, eloquent people, they are ignorant of your analysis. Your splendid thread on X (Twitter) – also 18 January – is compelling. It could inform them. They could get it and I would love to hear them speak the truth.
However, I did have concerns that your rapid creation might not be as accessible as I would like it to be. For a start, X doesn’t suit everyone. Next, you used three significant figures in places. I can tell you, as an ex-maths teacher, that too many people get confused by that (including ministers). Then, in your haste, you had written about ‘28 million households’ in one tweet, and in the next tweet ’28 billion pounds’. It took a few moments to see that you had multiplied the number of ‘households’ (28 million) by Sunak’s ‘cost’ of ‘1000’ pounds to change the ‘million’ to ‘billion’ and ‘households into ‘pounds’. I have spelt it out below because I know that if I (with a maths degree) needed a second look, some others would be totally lost.
Based on your Twitter thread, first I got myself clear. Then I wrote what I hope is a more graspable version.
Please use it – or some of it – only if you think it would help.
Rishi has claimed that a 10% pay rise for public sector employees will cost UK households £1000 each.
The truth is:
“A 10% pay rise for public sector workers” would:
• put the country on track for the services it wants and needs;
• raise the spirits of the nation and, surprisingly,
• mostly pay for itself.
Sunak is seriously wrong.
First, if each of our 28 million households were to pay an extra £1000 in tax, that would add up to £28 billion. But nothing close to that can happen. About 5 million people work in the public sector so they would receive the 10% pay rise which is a benefit to them – not a cost.
Second, some of the UK’s 28 million households pay no income tax.
Third, among the rest, thankfully, tax paid varies widely – because the wealthiest do pay more.
Weirdly, Sunak implies that every penny of the pay rise will just disappear – which is nonsense.
A pay ‘rise’ obviously goes to people who already have a job – and who already pay income tax. All of the extra, then, will be taxed. Also, of course, National Insurance is charged at 12% for employees and 13.8% for employers. Add income tax and NI together and about 40% goes straight back to the government.
If the PM’s statement had made any sense (it didn’t) “£1000 cost to every household” would have to be reduced by 40% or £400. “£600 cost to every household” is a lot less than £1000!
40% of the supposed £28 billion is about £11 billion which means that this £28 billion would go down by £11 billion to £17 billion.
But that’s not the end of it because, when the £17 billion goes into people’s pockets, it gets spent.
When it is spent, there is VAT on most of it. The standard rate is 20% but people will buy some zero- or lower- rated items. On the extra income spent from people’s pockets, a fair guess is that average VAT could be 15% – and this also goes back to the government.
That’s another £2 billion or £3 billion paid in tax which brings the £17 billion down to around £14 billion – half of the supposed original £28 billion cost of extra wages.
Then, the shopkeepers, traders and service providers who receive this £14 billion will also spend and pay tax – income tax, corporation tax, National Insurance; we don’t know the mix. Let’s be generous and say it’s 30%.
30% of £14 billion is a bit more than £4 billion that goes back to the government in one form of tax or another. This brings the £14 billion cost we have estimated down below £10 billion.
£10 billion is a lot less than half of the £28 billion which Mr Sunak thought a 10% pay rise for public sector workers would cost.
Of course, those who get this money will also pay tax on it … and so will the person who gets it after that. In fact, everyone will pay tax on it until people, who are wealthy enough to save what they get, put it into deposit accounts. That stops the money rolling. We can’t know how far down the line that will be but that doesn’t alter the fact that the real cost of a public sector pay rise is vastly less than what Sunak claims because he has ignored tax paid on the additional wages.
The above points are compelling, but even more important is that a pay rises lift spirits and productivity improves. Rather than worrying about bills or perhaps doing unwanted over-time – people can work in work time and take the proper time to care for their families as well.
With better pay, vacancies will be easier to fill. Fewer staff will give up and leave. Whether teachers or nurses, the morale of properly paid staff is likely to rise – and that uplift is badly needed in many situations. Job satisfaction tends to follow and so does the effectiveness of the service.
Perhaps money-motivated people – let’s call them entrepreneurs – do not understand what drives service-motivated people to become nurses, teachers and, yes, post masters. Most people in public service want a fair and effective society. If more politicians and commentators with business backgrounds could see it, the nation could get much better value-for-money if service workers were valued, enabled and supported.
As children become healthier and better educated, they will probably be happier and more likely to become law-abiding prosperous citizens.
Fairness requires that public servants should be properly paid. Good government requires honesty about what things really cost.
Sadly, there is a deeper concern. When chancellor, Rishi created ‘Eat out to help out’ – a catchy title that presumably he hoped would attract votes. He did not see that this initiative could accelerate infections. He did not appreciate that it was essential that he consult the epidemiologists. As a result, huge numbers of people got ill. Probably thousands died.
I acknowledge that he is eloquent and energetic. He devotes impressive amounts of time to the job of Prime Minister – and yet, on ‘Eat Out to Help Out’ he was not up to the job.
Similar thoughts apply to paying workers properly. He doesn’t understand, but worse, he doesn’t realise when he needs to get wise advice. The well-being of the nation depends on it.
Thanks
Noted
This was actually a much older thread that got revived by others on Twitter
But noted
Thank you Joe Burlington for a very compelling straightforward analysis. It’s refreshing in a world of doom gloom naysayers peddling impossibilities for their personal advantage as the only solutions. And thank you Richard for all you create here in your work to the same sustainable equitable end goal.