Tag Archive | "stealth taxes"

The folly of Environmental taxes

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The folly of Environmental taxes


For those that support green taxes, or to use the government’s jargon ‘environmental taxes’ it is worth noting just how much of the money that is collected in taxes, is actually reinvested into the environment and into reducing emissions. Given the numbers, it is little wonder that there are so many sceptics in the UK, in fact it is something of a scandal. This government is forever telling us how they value the environment, how they are leading the word in the reduction in carbon emissions and why it is so important that those that pollute the environment should pay. The reason I looked up the latest available figures was because the government offered so little new money to help those in fuel poverty in terms of saving energy and ostensibly, to reduce emissions.

According to The Office for National Statistics, the government collected £35.6bn in environmental taxes, that’s right, billion. This is equivelent to 2.7% of our GDP, a huge number by anyone’s reckoning. But how much did they reinvest? According to the ONS, in 2004, the latest year for which figures are available, the government invested £5.9bn into environmental protection measures. That is just 16.5% of the taxes collected. As we all know, since 2006, there have been further stealth taxes, sold as environmental taxes, which means that the figure collected in likely to surge in 2008, perhaps to £40bn.

How can anyone reconcile the platitudes and rhetoric spouted by this government regarding why we must pay green taxes, when they invest so little of what is collected in terms of green taxes, back into environmental protection measures? Green activists would be right to be angry, but so to should the tax payer, given we have been sucked into believing we were being taxed to the hilt in order that the government could introduce measures to protect the environment for the sake of our children.

The government have claimed that people can save up to 25% on their fuel bills if they follow a few measures in terms of insulation, low energy bulbs etc. Yet when the government told us they were investing £1bn to assist those in fuel poverty, it transpired that £910m was coming from the energy companies and just £90m from the government. This figure should also be considered in context, because the government reduced the Warm Front budget by a similar figure, so in fact their contribution was at best, neutral.

If you are angry, then consider this, our green government reduced spending on measures to prevent the atmosphere and climate change from £313m in 2003 to just £250m in 2004. This is hardly what we would expect from a government that claims to be leading the way. To be fair, the expenditure may have increased in the past 4 years, but as we all know, we cannot believe the figures provided by this government, so we will have to wait until the ONS can tell what the actual figures are. This is because, in case anyone has not noticed (we aren’t supposed to), whenever there is a tax rise, it is immediate, but when there is an investment to be made, we are told the total cost, over a period of years and there is always a delay before it is implemented. For example, “we will spend £900m over the next 10 years, starting from 2011“, you know what I mean. They will then repeat this number, making it sound like new money, every 12 months or so, or when they feel they need good headlines. Sorry, I am prevaricating.

I am not arguing against green taxes, but if they are labeled as environmental taxes, then the money should be reinvested into programmes which help the environment, reduce emissions and improve our planet. To ‘profit’ from this tax insults our intelligence, it devalues the whole green agenda and it demonstrates an indifference by a government claiming to care.

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Fuel Poverty and the proposed government rebates

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Fuel Poverty and the proposed government rebates


Gordon Brown is right, the rumoured proposal that the government provide rebates or vouchers to those in ‘fuel poverty’ is simply not sustainable. With an estimated 4.5m homes in fuel poverty by the end of the year, this problem is of a scale that no government can realistically resolve without placing a massive burden on the public purse. Worst still, the problem will still be there in a year’s time, possibly even worse and those recipients will expect the government to step in again.

The government is right, investment needs to be placed into a long term solution, that both encourages and helps people use less energy. This is part education and part investment. It is estimated that home insulation and other energy saving measures can reduce energy bills by as much as a third. However, the government recently reduced the money available to Warm Front by a third, this does not provide much evidence that the government is practicising what it preaches. No doubt Gordon Brown will reverse this decision and then suggest that it is “new money”.

Whilst there are an estimated 4.5m people in fuel poverty, it is worth noting that everyone is suffering, irrespective of whether they have been labeled as such. Those that are not currently in fuel poverty are also having to contend with higher fuel bills, higher food bills and in some cases, higher mortgage costs. Many who are actually working have had to seek part-time jobs. If the government provides subsidies to those in fuel poverty, the truth is, everyone else will have to foot the bill, either through higher taxes or higher fuel bills. The government need to be creative rather than simply shifting the burden, not least because those that are in work have consistently, under this government, been expected to take up the slack and pay for those that are not prepared to look for part-time work.

The government should increase the amount of money available for energy saving measures such as insulation and low energy bulbs. They should persuade, rather than attempt to threaten, the existing energy companies to meet this additional investment on a pound for pound basis. It must be remembered that these energy companies will have to invest billions of pounds over the next 10 years to secure our energy resources for the next generation. They must stop talking about a windfall tax, but instead, use the carbon trading scheme to maximum affect to encourage the investment in UK based energy saving measures rather than those of third world countries.

There is no doubt that the energy companies have taken advantage of the current turmoil to increase their profits and therefore the dividend payments received by their shareholders. The government must provide the regulator with teeth, in order that the regulator can control and approve energy increases. If the regulator is not in place to keep a handle on such matters, then what is it there for? [Can Parliament control Energy Prices]

Another, perhaps more controversial solution, is to allow those in fuel poverty to seek part-time jobs. Yes, I am talking about lone parents, pensioners, the unemployed and the 2.5m in receipt of long term disability payments. There will be some that are genuinely not capable of work, even light work, but the vast majority could do something, stacking shelves, cleaning, washing cars etc. If those in work have to help themselves to keep their heads above water, then why not the unemployed, lone parents, pensioners and long term disabled? Many won’t because they have to declare the money they earn and so, for every pound they earn, they lose it in benefit. So in a way, their view is understandable, given it is a disincentive to help themselves.

Instead of just giving them another handout, which only encourages them to expect a bailout everytime they are in trouble, the government should give them a tax free allowance, that would allow them to earn, for example, up to £150 per month without having to pay tax or national insurance. Yes, we wouldn’t get any tax revenues from these earnings, but neither would the rest of us have to pay out a cash subsidy in full. Better still, it encourages them to stand on their own two feet, to stop looking at the state, or more accurately their working neighbours, friends and relations to subsidise their living expenses. There may be a special case for pensioners, but they, of course, do receive additional fuel allowances and many would work part-time if it were not for the complicated process of paperwork and tax they must endure at the hands of this bureaucracy obsessed government. Those in receipt of ‘tax credits’ could be provided with a special ‘work credit’ that would allow them, or their partner to earn a specified amount of money which would not be subject to tax or national insurance. This could be removed, if necessary, at a leter date as the economy improves.

Any allowances should be very carefully targeted at those that simply cannot help themselves, genuine cases, not the workshy. Those in receipt of benefits would have no excuse not to do what everyone else must do when things are tight, to go and get a part-time job, to help themselves. You reap what you sow.

A creative approache to government always has its critics, because there will always be those that believe it is wrong to expect people to help themselves, or it is just not the way things are done in the UK. Who cares, our greatest leaders have had original thought and a desire to deliver. But, desperate times require desperate measures. A government bereft of original thought, needs to be more radical, a government that believes throwing money rather than opportunity in the direction of the so called poor, needs to look at alternatives.

This government needs to look at its income much the same as the average family. In difficult times, the family will look at ways to economise, ways in which they can generate additional income and ways in which they can reduce or minimise the cost of their borrowings. Government needs to adopt a similar approach. There are countless examples of this government’s waste, excess and abuse of taxpayers money. They need to reign this in now. Government needs to look, not at borrowing their way out of this mess, or just dipping into the pockets of the hardworking taxpayers once again. They must be creative in their thinking, radical in their approach and understand that if it was not for the taxpayers of this country, the poor would be desolate, starving and homeless. But there is a limit to just how much you can redistribute wealth and most taxpayers have had enough.

The pound is low, which makes exports much cheaper, this government should have their best ‘salespeople’ lobbying leaders of other countries to buy our products, to improve our exports. It doesn’t matter whether it is the trade department or the ambassador, everyone should be put to work to help this country. Taxpayers funds, as the government has finally discovered, are not the bottomless pit they once believed. Be creative, be bold and stop worrying about your seats at the next election. This government must start to demonstrate respect, not contempt for the ‘have’s’ that have subsidised and supported the ‘have not’s’ and allowed you to spread our money around as if it were your own or an automatic entitlement. Above all, remember, there are 650 of you that have been entrusted with the future of this country, earn that trust by doing your jobs!

A good start would be to suspend or dramatically reduce our overseas aid budget. This could provide up to £5bn to invest in energy saving measures. Charity, as the saying goes, begins at home. This government ignores that at it’s peril.

Posted in General, Labour | Comments (9)

A UK recession and economic competence

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A UK recession and economic competence


For the past eleven years we have heard nothing else but, how Gordon Brown was going to put an end to “boom and bust”, how he was an iron chancellor, and how New Labour were beyond reproach in terms of economic competence. How does this correlate with a UK recession that, by all accounts, only those outside government could see coming?

How could so many British people be so naive as to believe that a government that increased taxes and borrowing during a period of significant growth and wealth creation could sustain this? Why did we allow a government to dupe us in terms of its true financial position, with the off-balance sheet PFI initiatives that leave us owing some £170bn, which must be paid off between now and 2032? Government pension deficits of £790bn and so on? All of this on top of the “official” debt figure of a tad under £500bn.

Gordon Brown and his government have been caught out in the lie that has become the legacy of their time in office. They have left this country vulnerable, with high taxes, high debt, long term financial commitment and, above all, lacking leadership. New Labour has become synonymous with spin and its ability to consistently dupe the public and manipulate the press. Inevitably, we will all have to pay for their incompetence. Tony Blair was a prime architect and whilst he may be basking in the fruits of his former position of PM, giving lectures and writing books, he shares responsibility with Gordon Brown. Alistair Darling is just cannot fodder, he knows it, we know it, he is just the fall guy for Gordon Brown.

True leaders show their ability it times of crisis, not the good times and as this government moves from crisis to crisis, relying on a sticking plaster to fix things, it is just going to get worse. True leaders know when their time is up and those with integrity and pride, will step aside and let someone else in. However, there are two large problems here, firstly, a new leader of the Labour Party will not make any difference, given they are clearly a spent force, who have substituted the so called Tory sleaze, with a programme of lies and inept ministers. The second problem is where do we go from here?

David Cameron’s conservative party has still not told us what it is they stand for, what their policies are and what they are about. Yes, Cameron has come up with some quaint new soundbites, such as a ‘broken society’, but so far, it is just rhetoric. This is not backed up by new ideas, proposals, policies or answers. So we still have no idea what they would do if they were in government, so why would the electorate entertain such a party? We could simply be going from the frying pan, into the fire. As for the LibDems, well do we know who they are? Clegg says some sensible things, but this is a party that a year or so ago proposed higher taxes, how many governments have been voted in with a promise of higher taxes? Vince Cable is very knowledgeable, but the party sidelined him, because they felt he was too old, so what does that say about them?

The future does not look so bright! There is no obvious choice, unless Cameron can start to convince us that his party has original ideas and, above all, people that are capable of delivering on them. The main parties have 550 or so MP’s between them, but how many of us could name more than 10 or 20? What does that say about the way the political party’s are run. Even if we can name them, how many would we trust, if any, to lead us through this mess and do we know what they stand for?

As we enter this uncertain time, perhaps it is also a period for reflection, we need to consider whether our political system is truly representative. For example, how many ordinary people have a realistic opportunity to get elected as an MP, if they are not already aligned with one of the principal parties? The Labour and the Conservative party select their candidates based on many things, which often includes, but is not limited to, race, gender and loyalty. Why shouldn’t they advertise to get the best candidate? Yes this is simplistic, but the best ideas often are, surely the electorate is entitled to the best man or woman for the job, not those that are already part of the ‘club’ that is party politics right now?

Over the past 11 years, we have witnessed an obsession with government control, from the 4.2m CCTV cameras, through to the right to detain for up to 42 days without charge. We have been told that we must have ID cards to help protect us from the threat of terrorism, yet the government are trying to include so much biometric data that it is difficult to comprehend the true justification. It is claimed that the UK government and its agencies have more access to our private details than virtually any other country including Russia and China. This obsession with state control is worrying in isolation, but when this is coupled with a dishonest government, self-obsessed ministers, weak members of parliament and a virtually non-existent alternative party, we must start to worry.

There is no sense in kidding ourselves that we have choice or that we live in a democracy, if our choice of ‘elected’ representative is limited to the whim of party leaders. This country was quick to criticise China for primarily limiting their choice to existing members of National Peoples Congress. What is the difference, surely it is only scale?

We need change in this country, we need to review our whole political system and above all, we need to look at the way much of the news media sets the agenda. British Politics expands on this argument.

Posted in Conservatives, General, Labour, Lib Dems | Comments (12)

Gordon Brown you are seriously, seriously deluded

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Gordon Brown you are seriously, seriously deluded


In a recent statement, Gordon Brown said, “We are showing that,unlike previous governments that could not manage a way through these difficulties successfully… we are resilient in the way we are dealing with these problems.” What an arrogant, self-serving and belligerent remark from this man. He is passing judgment on previous government initiatives with the benefit of hindsight, whilst arrogantly assuming that his measures will succeed. Why, because he says so?

This is a prime example of a man that is deluded, one that believes he can do no wrong and one that is undoubtedly surrounded by ‘yes’ men constantly telling him how brilliant he is. Any decent leader will surround himself with people that will challenge him, test him and guide him. This ensures that the ‘leader’ keeps his feet firmly on the ground and does not start to believe his own spin, it is a dangerous cocooned world. Smart people recognise this; clearly some politicians and cabinet ministers do not. But it is the difference between leaders and truly great leaders. Take a look at Gordon Brown’s ‘inner circle’ can you see anyone that is likely to challenge him on policy without being crushed?

If this wasn’t enough, Gordon Brown has, once again said, “There are unique circumstances with the trebling of oil prices. That has not happened previously – and of course with the credit crunch”. In other words, it’s not my fault guv, I have done everything right; it is everyone else that is at fault. If your ministers and advisors don’t have the balls to tell you what you have done wrong, maybe it is left the public?

  • You have hiked our taxes through a series of stealth taxes, to the extent that you have nowhere else to go, you have little or no room for any further tax increases.
  • You have raised £billions in national insurance contributions and then recklessly spent this money on quick fixes rather than long term investments in the health service.
  • You have allowed government departments to squander £billions of taxpayers money on projects that have been curtailed, scrapped or changed.
  • You defied repeated warnings from your own officials in terms of the time bomb you would create by scrapping tax relief on dividends paid into pension schemes. As a consequence of your actions, you have devastated the lives of hundreds of thousands of pensioners and what do we have to show for the estimated £100bn you have scored from their misery? As a result of your meddling, many final salary pension funds have been scrapped….and some companies have had to find £millions to top up the funds.
  • It is estimated that you cost this country close to £2bn when you decided to sell our gold reserves at the wrong time. On this occasion, you ignored the advice of the, Bank of England.  

Whilst the last conservative government may have introduced the Private Finance Initiative (PFI), you made it into a major instrument for the provision of public facilities and services, effectively forcing public bodies to use the PFI model. As a consequence, public bodies are committed to paying a total of £170 billion to contractors in more than 800 PFI schemes up to 2031-2032…not surprisingly; this figure is growing every year.

Of course, we know why you did it, because PFI debt is not usually treated as public borrowing for accounting purposes and therefore doesn’t contribute to the Public Sector Borrowing Requirement (PSBR).  In other words, PFI debt is usually “off balance sheet”, even though the state is ultimately responsible for
repaying it. 

I agree you are resilient, there are not many people that could make so many mistakes, so consistently and still claim to be the leading architect of the success of this country. We have succeeded in spite of you, not because of you and one day the electorate and the newspaper editors will wake up to this fact. If you had been genuinely prudent, we would not have the level of public sector borrowing that we have, we would not be in a position where there in no money in the piggybank to allow us to weather the storm of this current downturn. And, we would not all feel so much pain as a direct consequence of your massive tax take from our current earnings, as well as the reduction in value of our pension funds affecting our retirement plans.

Let me remind you, that £400m was spent on ‘cost control’ for the Olympics, how can you honestly justify that level of expenditure with a straight face? Would a “prudent” chancellor allow expenditure of over £16 million on the creation and upkeep of VIP lounges in Heathrow and Gatwick despite the fact they are not government-owned?

You cannot abdicate responsibility by blaming Blair for the first 10 years either, because we know that, the Treasury, under your tenure, became the principal originator of government policy, rather than an evaluator of policy. Your personal obsession with micromanagement has lead to the introduction of thousands of targets aimed at directing policy; it also determined exactly each the departments should meet their targets. So when a department was or is failing, it is impossible to tell whether the cause is the policy itself or its implementation. This has made it virtually impossible for the Treasury to judge poor performance. Another tidbit for you, during your tenure, the Treasury was one of the largest spending departments, with a budget of £20bn. Is that prudence?

Let me remind you of some of the things you have achieved. Following your introduction of complicated tax credits, it is estimated that the taxpayer (no not the government, it is our loss, our money) loses £2bn every year through fraud and errors. In spite of your micromanagement, it is estimated that the planned NHS computer system will cost £6bn more than originally planned. 

I could go on, but it would take me weeks to list Gordon Brown’s “achievements”. Far from being a prudent chancellor, I am convinced that in years to come, we will look back at both his chancellorship and his period as prime minister and have a completely different take on this so-called iron chancellor. I am further convinced that we and our children will be spending the next 30 or 40 years paying for the mistakes of this government, the former chancellor, the former prime minister and the current prime minister. Gordon Brown should consider his words carefully, because they will surely come back and haunt him, no doubt at a
time when he is not surrounded by yes men telling him how brilliant he is.

 

 

 

 

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