EU Finger Pointing, Deficits and Projections

As 2011 draws to a close let's take a look at the EU financial situation.

The 17 EuroZone countries plus an unknown number of other EU countries, but not the UK, have agreed a new financial treaty.  Amongst other things this limits deficits and borrowings.  Worryingly, from a democracy perspective, EU bureaucrats will get sight of and review national budgets, of those that sign-up before the sovereign parliaments.

Yes, I know what you are thinking.  This borrowing limit was agreed to back at Maastricht when the same countries signed-up to the Stability and Growth Pact.  This was intended to keep the Germans on board as they gave up the Bundesbank control of their currency.

Guess who broke the rules first?  Yes, you're right - Germany!  Who else?  Everyone!  Though Spain broke the rules least, it is now suffering 20+% unemployment and a trade deficit of more than 4% and its labour costs are more 30% above what they were in 1999, when the Euro started!.  France's labour costs are 25% higher and Italy's on a par with Spain.

Good news though is that Germany labour costs have barely moved since 1999!  That contributes to a German trade surplus of close to 6%, while France and Italy all endure the consequences of 2-4% deficits, alongside Spain.

Very communitairre!

So 2012?
Maybe Germany needs to leave the Euro (Netherlands also?) so as to allow for a devaluation and reduce the labour costs in the other countries?

Other countries, outside the EuroZone,  will start to look at the recently agreed-to 'fiscal accord' and this will likely start to unravel.

If Germany doesn't exit the Euro, then look for Greece to do so maybe also Italy and/or Spain.

Germany, France and the European Central Bank will try for a managed devaluation of the Euro but the markets already scent blood and will be pushing for more and for faster.

Step in the credit rating agencies - and cherished gold-plated ratings are lost.  France will be mortified and loudly proclaim an Anglo-Saxon plot but won't look at their own precipitous growth in public and private debt, in the last ten years! 

The trigger (s)? 
Could be the weather - a cold snap forces people out of their unheated homes, onto the streets in protest.   A Greek default - there is only so much they can do and that isn't enough. 
Italian indigestion? - brought on by trying to take medicine from a technocrat.  

Oh, and a recession in case you thought you could ride-out all of the above.

Have a healthy 2012 - I would normally say prosperous but........

 

Stunning Ho Chi Minh City time-lapse

Have to share this with you.  This is exactly as frenetic as it is, each and every day.

http://www.geek.com/articles/geek-cetera/epic-time-lapse-of-ho-chi-minh-city-2011127/

Council Tax - Ask your council these questions

How much are the council's cash reserves?
How much have they increased in the last 12 months and the last 24 months?

The below story is from The Daily Telegraph.  Don't look for it on the (still biased) BBC as it doesn't fit their agenda!

New figures from the Department for Communities and Local Government will today reveal that local authorities are likely to have £10.8 billion in reserves by March – an increase of around £240 million on the previous year.

Councils are advised to keep sufficient sums of money in reserve so that they have a financial cushion to meet sudden unexpected costs.

But the extent of the cash piles may cast doubt on complaints by some local councils that they must make deep cuts to public service and cannot afford to freeze council tax.

Eric Pickles, the Local Government Secretary, last night said councils would have “room to manoeuvre on their finances next year” because of the huge amounts of cash on their books.

Soon after the Coalition came to power, Mr Pickles urged local authorities to dig into their “piggy banks” as more than 50 were holding more than £50 million in their bank accounts.

The new figures show that councils do not appear to have heeded his advice, despite planned cuts to local libraries, nurseries, road maintenance, street cleaning and other public services
Grant Shapps, the Conservative housing minister, has also previously accused Labour councils in particular of hoarding money instead of using the cash to keep public services open.
He claimed councils had been making “political cuts” that were “totally unacceptable” while sitting on vast cash reserves.
The new figures show that some of the biggest increases in reserves came from Labour-led Wakefield Council, which is expected to have more than doubled its cash pile from £21 million to £51 million by March.
Meanwhile, Labour-run Bolton Council is likely to have tripled its reserves £23 million to £81 million.
Emma Boon, campaign director of the TaxPayers’ Alliance, said councils should be easily able to freeze council tax given the level of reserves.
"Given the amount of reserves councils are sitting on they should at the very least all be freezing council tax this year, and many could go further,” she said.
“Local authorities could help households struggling to pay council tax, which has almost doubled in the last ten years, but instead many are hoarding large sums of taxpayers’ money. Councils should review the level of reserves as some have put aside far more as a percentage of their spending than others.”

Send letters to you local newspapers and publicly ask these questions.  Shame these councils into freezing or reducing the 2012/13 Council Tax bills.

Barnado's and credit firms

Families on low incomes are being exploited by so-called rent-to-own suppliers of household appliances, a children's charity has warned.

Barnardo's said rent-to-own lenders should be forced to display the equivalent High Street price of the product and make interest rates clear.


Barnardo's said consumers were paying up to 150% more for some standard household appliances.
It cited a three-year rental arrangement with a well-known weekly payment store that cost £1,074 for a fridge freezer, compared with a High Street price for the same product of £430.

The above quotes come from the (still biased) BBC.

Barnado's is a charity focused on children.  What business is it of theirs to be interfering in what happens in the high street?  Would they sooner that these stores didn't extend credit to low paid families and that these families then went without these appliances?

Or is the sub-text that such appliances should be provided by the 'State'?

I suspect that a big part of the reason for the high costs reflects the risk attached to advancing this credit.  A major reason for the sub-prime mortgage crisis was that lenders forgot one of the basic rules of lending which is to match reward and risk.  They lent to everyone with a heartbeat (and probably some without) and then, surprise, surprise, found that many simply couldn't afford to pay back!  Cue economic doom and gloom, all around.

Rather that people know upfront, the cost of this appliance is so much per week for the next three years than the lender making the sale and then having to come 'cap in hand' to the taxpayer to be bailed out.

Not forgetting of course, that people still have free will!  They can make a choice.  It goes something like this:

Mum:  We need a new freezer.  The old one is unrepairable.  I could buy one new, for £430 or pay £6.88 a week for three years.

Dad or baby-father or partner:  Well we haven't got £430, so we either buy on tick or we do without.

Mum:  I need a freezer.  Then I can stock up on food when it is cheap and save money, so it will have to be on tick.

or

Mum: I need a freezer.  Then I can stock up on food when it is cheap and save money.  I wonder if Barnado's will ignore the Charity Commissioner and give me the cost of one?

UK Foreign aid and Economic Performance.

According to a report on the (still biased) BBC, the economy of Brazil has overtaken that of the UK, during 2011.

As you will see from the table below, produced by the Centre for Economics and Business Research, Brazil has pushed the UK economy into being the seventh largest in the world.

And you would be right in assuming that the UK continues to give foreign aid to Brazil!  Also to India, which is seen to have the tenth largest economy in the world.  It is difficult to get data out of the Department for International Development but I would not be surprised to see China as a recipient of foreign aid, as well!

While we may think it laudable to provide overseas aid and some consider that the old adage 'charity begins at home' is too narrow minded, how can it make sense to provide aid to countries that have such thriving economies?

When might we stop providing aid to these and, if we must provide aid, give it to those countries that both need it and do not currently have an economy that helps them get up off of their knees?

We regularly hear from left-leaning news media, that 'child poverty' is a growing phenomenon in Britain and at the same time we send funds overseas to relieve 'child poverty' in other countries (something which the self-same left-leaning media, think we do not do enough of!)

I wish someone could tell me how this makes sense.

CEBR World Economic League Table
Rank	2011	2020 (forecast)
1	US	US
2	China	China
3	Japan	Japan
4	Germany	Russia
5	France	India
6	Brazil	Brazil
7	UK	Germany
8	Italy	UK
9	Russia	France
10	India	Italy

London Tube strike and the Labour Party

Today, when many capital city retailers were hoping to benefit from additional footfall and business, the great city of London is held to ransom by an over-privileged and exceedingly small group of union members.  Families and friends wanting to visit each other are unable to do so.  Why?

The around 3,400 London Tube drivers include 2,200 who are members of the Labour Party supporting union called ASLEF.  This union was obliged, by legislation passed under Conservative governments to ballot its members regarding industrial action.

Of these 2,200 cosseted individuals (annual salary fast heading towards £52-55,000 a year or twice national average salary) less than 1,000 members could be bothered to vote (42% to be exact) and these die-hards then voted overwhelmingly 92% in favour of strike action.

Over what are they striking?  This is a long running dispute because the union demand no compulsion about working on December 26 - only volunteers - and they demand extra pay (quadruple) for those that do volunteer to work - that is instead of the time off in lieu and extra pay that they already receive.

Londoners, don't expect to hear condemnation of this strike from the Labour party.  Now that so very much of its funding comes from the Unions, it cannot afford to upset its paymasters and remember that it was Union votes which 'won it' for Miliband.

Also Londoners should not expect any condemnation from Glenda Jackson, Labour MP for Hampstead and Kilburn or Jeremy Corbyn Labour MP for Islington North both, per the ASLEF website receive support from the union.  Jeremy, according to his website is far too busy asking questions about Libya and Columbia and Iran to be interested in anything so mundane as that which would actually directly affect his constituents!

I think that it is time for the Government, led by the Conservatives to step in and spend a few moments away from the international economic crisis (which after all, doesn't seem to be affecting the Tube drivers economy) and swiftly bring in legislation to the effect that for any strike action to be legal, a majority of all members eligible to vote, must be passed.  So, greater than 50% of the membership not just those who bother to vote.  Consider the low turnout that was seen for the public sector strikes that occurred at the end of November 2011 - poorly supported, all around!

Cameron and Co.  - What do you think you might risk by such legislation?  To paraphrase Nike - Just Do It!

December 25

Wherever you are today, and who ever you are with and whichever religion or none, that you follow, I take this opportunity to wish you and those you love a very peaceful and happy Christmas.

Agency workers

The Agency Workers Directive comes into force in the UK, shortly.  This effectively extends the same rights to 'temporary' workers as those enjoyed by permanent employees.

Why not go the whole hog and ban temporary workers?  Then we could move on to banning private businesses and have everyone working for the state!

Europe, including the UK, is in the midst of a recession and what is the response of governments?  To impose further costs and regulatory burdens on struggling businesses.  If you took such a script to Hollywood they would throw it out as 'too fanciful and too unbelievable'.

If you were the owner of a small business and had the potential to pick-up some extra work but it required you to take on agency/temporary staff, would you now do so?

This smacks to me of yet more fiddling while Rome and of course Athens, burns.

Is there any chance, do you think, that the politicos will ever get around to addressing the real and pressing issues that face all of the economies in the EU?  Re-arranging the deck-chairs on the Titanic, comes to mind.

Execssive charges - latest update

Regarding my last post - check out this video.
http://www.youtube.com/watch?v=HPyl2tOaKxM&feature=related

Excessive card charges?

The UK government is to bring forward rules to force companies to reduce 'excessive' charges that are made for the use of credit or debit cards, when making online purchases.

Why?

What business is it of the government?

So a clearly marked charge is likely to be replaced by a fee for Administration or Internet Service Fee or something like that.

Who benefits from that?

Consumer action groups such as Which have pushed for this but do they really think these fees will go away?  Like it or not they are part of the revenue and, contribute to the margins, for online companies.

This is the usual fatuous interference in business that we came to expect from the previous 'administration' and are now seeing repeated by this coalition.

If I don't want to pay so called excessive charges, I have a choice.  I can go elsewhere.  I don't need a consumer organisation or the government to 'nany' me through this, especially when, at the end of the day, I am no better off.

Do people really expect things for free?

France and Turkey

So typically French!
French MPs are pushing a bill which would criminalise the denying of an alleged/disputed genocide of Armenians in 1915/16.

Ask yourself this.

If you were a French MP, what would be your top priority as you head into 2012?
Tackling the Euro Crisis?
Addressing the structural deficit in the French economy?
Wondering how to reduce French bank sovereign debt exposure 
Attacking the British?
Continuing to alienate a faithful ally like Turkey?

Okay, since you are pretending to be French, you can have two priorities.

If you are doing it right, neither of your priorities relate to the Euro crisis or the French economy.

If you didn't get it right, then in time-honoured EU tradition, you can have another vote and keep on doing so, until you get it right.  Bien? 

Fiddling while Rome burns comes to mind.

Energy - Make your mind up

What do you want?  Access to energy sources that provide a cheap (cash terms) solution such as natural gas and ultimately nuclear power or a return to some kind of green Utopia, where we all work within two miles of where we live, plough the fields and enjoy subsistence farming?  If you are a 'Green' you don't need to respond, I am sure I know your answer!

There is much debate about 'fracking' and the seismic and possible water-table contamination effects of this.  I must declare an interest as I work for an oilfield services company, though not on the technical side.  The seismic activity is very minor if and when it occurs.  Since the drill bore is lined with a cement casing, the possibility of fracking chemicals leaking into the water table are somewhere between zero and non-existent.  Those are facts but don't let that stop you from disputing them!

Consider the 'green' energy alternatives.

Wind Power?  I read a piece once, which concluded that the energy required to build and install a wind turbine would take 15-20 years at nominal turbine capacity, to be generated.  So 15 to 20 years just to stand still.  Consider also, that for all wind power capacity, standby generating capacity must be kept in place and kept running for when the wind reduces.

Solar Power?  I looked into this earlier in the year, before the changes in FiT came into place and the generating capacity of my roof, which is for a large 4 bedroom house, wouldn't be sufficient for my 4 person family.  So, fill the fields with solar panel arrays?  That might boost capacity at the expense of agriculture!?!?  Again though, we would need standby capacity to supplement those non-sunny hours.

Wave Power?  Can't see this being viable and strongly suspect that the transmission loss would make this unsustainable over distances.

Nuclear Power? Seems to me that this is where we will end-up, though the journey there is going to be difficult and made even more so by spineless politicians who know the answer but are in thrall to the media and don't want to risk any public backlash by telling people the truth.

Natural Gas?  Must be part of the shortish term answer.  Gas is very low-priced in the US because they use fracking to get at the gas and can thereby reduce their dependence on foreign sources of energy.  People in Ukraine have seen what happens when they try to assert themselves towards a big supplier (Russia).  How long before Europe kowtows?

In truth, all of these energy sources can play a part in meeting our needs but you are deluding yourself if you think there is a 'silver bullet' out there which means we wouldn't have to use natural gas and nuclear power.

Incidentally, why are we spending vast amounts of money which we don't have) on CERN and the Large Hadron Collider?  Why don't these scientists devote their time and efforts to finding sustainable sources of energy (preferably clean)?  Surely that is more important than the Higgs Boson?

PFI - Call their bluff

The Private Finance Initiative was a great 'wheeze' dreamt-up to park long term liabilities off of the balance sheet of UK Inc.  You know, the kind of thing that got Enron into trouble and caused UK politicians, of all hues, to rain down criticism on these people.  No hypocrisy there!

 NHS hospitals are under increasing financial pressures and are faced with long term liabilities (PFI contracts) that they simply cannot sustain.  If the NHS was a commercial organisation it would approach it's landlords and seek revised terms - bluntly stating that they can't afford the payments, any longer. 

So why don't they or rather the individual trusts do just this?  What will these finance companies do - sue the NHS trusts?  If the NHS just turned back the property to the funding institution and each trust declared itself bankrupt, what then?  I can't think that there would be anything to stop other organisations immediately (or even in anticipation) setting themselves up as trusts (authorised by the Department of Health) and then offering to make use of these facilities but at reduced rates.

It is only because the PFI companies know that at the end of the day, the UK Taxpayer sits behind and acts as financial guarantor for the NHS Trusts, that they do not adjust their rates. 

So, take away that guarantee. 

I know, some will say 'it is unfair to change contractual terms after signing a contract' but that happens all the time in business.  The majority of these contracts were signed when the UK was living in denial and way beyond its means.  Times have changed.  These contracts need to do likewise.

The smart PFI people will read the writing on the wall and volunteer to reduce rates.

If we can't do the above, then let's tax the gross income from such contracts at a higher rate - say a special levy of 25% might be a good start.

Gus O'Donnell interview

The UK Cabinet Secretary (a Civil Service post) retires on December 31, 2011 and has given an interview.

In this, he highlights the three key issues facing the UK;  The EU, The Economy and the Union.

The EU - If you believe some, the UK is isolated and so can expect to have little influence.  Reality though, is we are still a member and as such need to continue to push for reform of EU institutions in spite of what some petty Euro MPs think of us.

http://blogs.telegraph.co.uk/news/danielhannan/100124965/time-for-britain-to-make-the-great-escape/

Click on the above and Open!

The Economy -  Everyone (except Ed 'I think we should borrow more' Balls and Ed ' does my voice sound funny and whiny to you' Miliband) agrees that 2012 is going to be a hard year, and 2013 doesn't look great either!  However, stopping the austerity measures isn't really an option.  Indeed many say the cuts should be deeper and more immediate.

Also, the fate of the economy is inextricably linked to the actions (or rather, non-actions) taken by the EuroZone members.  At some  point, fairly soon, I expect (not wish for) that the financial markets will lose patience and will attack one of the Eurozone members.  I would not be surprised if they took a tilt at France.  The exposure to sovereign debt for French and German banks is worryingly high.

The Union - I have posted before.  Have a referendum in Scotland and one in England and go with the wishes of the people.  No more delay.  I see that Alex Salmond and the Welsh leader, Jones have requested a meeting with Cameron to discuss his handling and us of the Veto at Brussels.  They both full well know that Foreign Policy is a 'reserved' policy and falls outside the ambit of the devolved administrations.  Their comments are posturing such as only petty people can manage.  Time Cameron slapped them down and sent them scurrying back to their Celtic palaces.

I have just re-read the paragraph on The Economy.  Why is it that in the case of Labour, two Eds are not better than none?

Incidentally, Gus O'Donnell is retiring aged 59.  Presumably on a sizable pension linked to his final salary of around  £235K and index-linked for life!

John Terry to be charged

John Terry is to be prosecuted over an allegation of committing an aggravated racial assault.  The incident occurred during a game between Chelsea and QPR, in October.  Chelsea lost the game 1-0.

This is such a shame as throughout his career John Terry has demonstrated what a fine upstanding person he is.  I mean, forget about parking in 'disabled bays' and marital infidelity, that could happen to any captain of England that plays for Chelsea.  Rather remember those great performances that he has given in the service of the national side.

Oh Wait !

He hasn't actually given any great performances.  He was as leaden as could be against Germany in the World Cup, and that may have been one of his better performances!

Falklands - Is this a story?

The Latin American trading nations, that form part of Mercosur have backed a ban, proposed by Argentina.  This refuses entry to Mercosur ports for ships carrying the Falkland Islands flag.

Big story?

How many merchant ships do you think actually carry this flag?  Answers on a (small) postage stamp to:
Mercosur HQ
Attn. Someone who gives a damn
Anywhere Street,
Buenos Aires
Argentina


Should the UK retaliate?  Will they be joined by their 'partners' in the EU?  Is Uruguay's inclusion a reaction to the suspension of Liverpool's Suarez?

Watch this space.

Or don't.

Suarez Fine

Firstly to declare a non-interest.  I don't support either Liverpool or Manchester United.


Congratulations to the FA for sending a very clear message about the non-acceptability of racism in football.  I guess they took the view that FIFA, led by the incredibly inept Sepp, would never take it seriously enough.

Maybe Fifa's agenda is already too full? 
Discuss Bribes, Discuss Blatter's latest gaffe, Don't forget to discuss bribes, Must issue a stern statement about not using modern technology, discuss bribes, and discuss Blatter's earlier gaffes. 

Liverpool would do well to voice their anger at the punishment and then leave it at that.  To do otherwise might suggest a less than whole-hearted support for the anti-racism measures.

Happy Christmas or Happy Holiday?

A trend is increasingly creeping into our language and practise, where out of heightened perceived sensitivity to people of other faiths (or none), people now say Happy Holidays when they really mean Happy Christmas.

I have enjoyed the pleasure of working and living among Muslims and when the feast of Eid al Fitr occurred at the end of the holy month of Ramadan, we never said Happy Holidays, we said Eid Mubarrak!  Similarly, among the Hindus I know, I never greet the festival of light - Diwali or Deepavali - with Happy Holidays but with Happy Diwali! 

So why do people treat Christmas differently?

Recently I heard a guy on the radio, in the USA, and he was talking about this.  His response to a Happy Holidays greeting was to say, 'Thanks, I am celebrating Christmas, so Happy Christmas to you and your family.  What holiday are you celebrating?'

Try it.

Remember the reason that many countries enjoy a public holiday on December 25, is because it is on that day that Christians celebrate the birth of our Saviour, Lord Jesus Christ.

Have a Happy Christmas, to all mankind of all and no faith!

English Police and the August Riots

The tactics employed by the police, during the riots that swept England in August 2011 have come in for much criticism, from various study reports. 

Today it was suggested that the police should have used water cannon and rubber bullets/baton rounds and even possibly live ammunition. 

Like many I was horrified at the lawlessness that was allowed to occur and at the inaction of the police. 

I don't really need long-winded studies to tell me that by standing back and doing nothing the police encouraged the rioters who quickly came to the conclusion that their actions would have no consequences and the benefit of cheap purloined goods.

The robust sentencing that was practised, disabused the rioters of the latter but the hands-off approach of the police still hangs as a likely outcome for any future disturbances unless the police and the government state, in the strongest possible terms, that should any such outbreaks occur, we will deal with them very severely.

That is, the police will use water cannon (maybe with an indelible dye?) and will use baton rounds and if required will use firearms to protect life.

The police need to know that such use will not then be subject to 20:20 hindsight review because some poor rioter got injured.  If you are on the streets during a riot, the chances are you are part of that riot and I make no apologies to say that if you are there and you get hurt - tough!

Incidentally, my conspiratorial mind wonders if the police stood back to try and send a message to the Government along the lines of ' this is why you need us and don't even think about trying to reform us because this could happen again'.

Comments?

Tax Collecting and MPs

A House of Commons Committee of MPs has criticised the settlements that HMRC, the UK Tax authority, has reached with some companies, as cosy.  They have also asserted that they believe there are more than £25 billion of outstanding tax issues with companies.

So, let's look at that.  HMRC reached agreements with Goldman Sachs and with Vodaphone that settled long running disputes on their complex tax affairs.  That is, supposed experts reviewed the evidence and submissions and then decided that the best deal for the tax payer was the one that was on the table.  This presumably was less than they might have got for us if they had gone to court (and lined the pockets of lawyers) but more than the cost of incurring additional expense. 

Of course, this then frees-up those investigators to examine the affairs of other companies and so perhaps overall get more money flowing in?

As for the £25 billion of outstanding tax issues with companies. 

This is a typical ploy.  Think of a number, make it bigger and add the word billion after it.  Why doesn't, the still biased, BBC and other media, ask these MPs from where this number comes?  Which companies are evading this amount of taxes (that is clearly the implication)?

Could it simply be that this is the amount of tax that is in dispute between HMRC and companies?  If yes, then what would we expect - nothing to be in dispute?  Nothing outstanding?

Here is a quick question - How many of the MPs on this committee do you think actually have real world business experience?

And another one.  How many of them understand that it is common that a company's tax issues can stretch out for a number of years before they are resolved?

And yet one more - doesn't under paid tax accrue an interest charge?

And a final question - do you think that the committee was miffed because the HMRC head, stated that he would not discuss or disclose details to the committee on the grounds of the long held position of confidentiality of tax affairs.

Kim Jung Il

So he has gone!  It's his family I feel sorry for!  Actually no it isn't.  That is what we usually say. 

This time, it's his country and its people that we feel sorry for.  Early signs are no change and so these poor folk will continue to suffer starvation and oppression as well as living in an extremely backward country.

My heart bleeds for them but for Kim Jung Il - good riddance

Banking again

Help me to understand.
We are told that the financial crisis started because of the sub-prime mortgage business in the USA (so not Gordon's fault?) and this contagion spread around the world.

Now the solution offered by Sir John Vickers & Co is to segregate Investment and Retail banking and thus put outside the realms of state protection, the 'casino antics' of investment banking. 

Presumably, mortgages will fall into Retail banking and thus be protected?    So if a bank has a 'run' on it or has insufficient funds Sir John & Co expect that ignoring recent history, this will hit the investment side and not the retail side?

Remember, Northern Rock was a building society (Mutual) as was Bradford and Bingley.  Both of these effectively went bust, VERY early on, in the financial crisis, and had to be rescued. 

I don't recall hearing anything at the time that they were indulging in investment banking.  

I do recall hearing that Northern Rock was handing out mortgages based on six times a single earner and on 125% of property value.  Tell me that that isn't irresponsible lending - some might say casino practices?

Hey though!  The solution has to be to pander to those that look on the UK's financial sector with envy and anger, and instead impose a 'solution' that won't address the underlying issues (when does a committee ever do so?) but does impose additional costs for the consumer (there's a surprise!)

Comments?

Banking "Reform"

So here we go. 

We will 'reform' the UK banking sector and add between £7 billion (Government estimates) and £10 billion (industry estimates) of cost.

Three guesses who will actually pay this.  No clue?  Well, no surprise it's me and you, UK bank account holders.

Oh and remember that we are to put this in place and it will be more draconian than in any other country as will the capital requirements we set for the banks that remain here, before any other country, including our major competitors are even contemplating such restrictions.

You could call it madness but that might upset the Lib-Dems and we mustn't do that!! 

Now if we could get the Lib-Dems party members to pay the  £7 -10 billion, I might not be so angry!

Northern Rock

So, having Nationalised Northern Rock and then agreed, with the EU, a timetable for its de-nationalisation, te Labour Party now say that the deal with Virgin Money should not be implemented because the National Audit Office (NAO) are conducting a study!

Labour agreed the deal with the EU.  Labour nationalised Northern Rock and pumped in taxpayers money.

The current government, as with so much of their activities, is now cleaning out the mess left by Labour and is seeking the best value for money that they can get, for the UK Taxpayer.  The process to sell Northern Rock was (very) long-winded and one presumes that all interested parties put in their offers and these were weighed and measured. 

The UK Government should proceed with the sale unless by January 1, 2012, Labour or the NAO can produce concrete proof - a large cheque payable to UK Gov will suffice - that there is a more lucrative alternative. 

The UK Government has gone for the bird in the hand rather than some pie in the sky two in the bush!

Deport immediately

Can anyone tell me why, when a judge sentences a non-UK citizen to jail, to be followed by immediate deportation, the individual isn't put on a plane, an hour so or after the sentence ends.  Or even an hour or two just before?

We hear stories of people that the UK Government are trying to deport offending and re-offending and all the while the machinery of 'justice' groans slowly on.

During the August riots, courts sat for longer hours and swiftly meted out punishments.

Here is an idea: 
Have the immigration/deportation tribunals sit in one room and then the appeals tribunal sit in the next and if someone decides to appeal, then move straight from the first to the second - no 6 month or a year's delay, usually spent offending or on the dole, would be necessary.

And a further idea:
Have these tribunals sit longer and more often.  At least until the back-log is cleared.

And finally:
Stop the legal gravy train.  Don't allow anyone convicted of an offence to have their deportation fight, funded by legal aid.  Solicitors and Barristers just love our system of justice, where they can stick their noses into the public trough time and again.  So Legal Aid only for UK Citizens.

Summary
Speed up the process and stop funding re-offending. 

Scotland the brave?

Scotland the brave? 

Or

Scotland the coward?

We hear time and again that Alex Salmond will decide when to call a referendum on independence. 

We also hear much about the SNP mandate for governing Scotland.

So what is stopping the SNP calling a referendum?

Lack of courage or belief that they will get an answer that suits them?  Or, that once called, whatever the outcome, they will have lost their major, indeed only, bargaining chip with the UK Parliament?

I don't know how the Scots would vote.  I sense that they would want to stay with the Union, if given the choice but we may never know because I believe the SNP don't really want a vote.

However, I am not sure that the English would say the same if they were given the choice.  And surely when the question is to break or keep a long-standing union is posed, both parties to the union should be consulted - that is, the Scots and the English.

I think it is time for Cameron and the UK Parliament to 'lance this boil' and call a referendum on both sides of the border and not wait on the whims of the wily Alex.

Then once that is out of the way, if Scotland votes for 'freedom' to quote Mel Gibson, they can go on their merry way to a socialist oblivion and the English can remain the conservative and prosperous nation it always has been.  (Please, if you comment, do not prattle on about 'Scottish oil' and I promise not to give a lecture on Maritime Law and ocean boundaries)

The interesting thing might be, what if Scotland says no to independence and England says yes? 

Scotland decides it wants to stay part of the UK and receive the benefits it now does and England says no we want to have an equal Union where the spend per head in Scotland is equalised to the amount spent in England.
Oh Dear! What then?

Perhaps that's why Alex doesn't want to ask and David is too nice to push him into a corner.

But Alex.  Take care, last week Cameron shows he has 'a pair' when needed so either put up, and call a referendum or shut up and stay in your overpriced Edinburgh palace.

Why criticise Cameron?

So now David Cameron is being criticised for saying we should follow Christian values in the UK and address the 'moral collapse of the country'.

Exactly what is wrong with what he said.

He didn't say you must be Christian.
He didn't say you must have a religion.

He did say, as quoted on the BBC website:

"We are a Christian country and we should not be afraid to say so," 


"Let me be clear: I am not in any way saying that to have another faith - or no faith - is somehow wrong.
"I know and fully respect that many people in this country do not have a religion."

 "But what I am saying is that the Bible has helped to give Britain a set of values and morals which make Britain what it is today."

 Why would someone be offended because David Cameron spoke of encouraging people to stand-up for decent moral values?

Think back to last August. 
Don't you wish that more people had displayed decent moral values? 
Don't you wish more people had followed the examples of the Asian community in Birmingham ?  They paid a very high price for doing the right thing and then displayed a thoroughly decent and highly moral response when three of their loved ones were mown down.

Award disrespects the true victims of Post Traumatic Stress Disorder

The British part of the World has gone mad.  More specifically, the legal side.
A doctor has just been awarded £4.5 million because of discrimination against her.

She was adjudged to have been hounded out of her job by colleagues and the Trust at the hospital where she worked and to be the victim of sex and racial discrimination.

Now go back to the second line and make sure you read it again - £4.5 million!

Consider:
She is 53.  She left her position in 2008 but the trouble started back in 2003.  So approx when she was 45.  Meaning she then had 15 years of normal work before retirement.  Is someone saying that her income is £300K per year!

Consider this as well:
She is said to be suffering from 'Post Traumatic Stress Disorder'.  This is usually associated with those that go through horrific episodes such as bombings and shootings.  Sorry, but I can't help think that this association between her suffering and those of the July 7 victims or that of our military in Iraq and Afghanistan somewhat diminshes that of the latter.  And that is shameful.

I haven't seen the evidence in this case and frankly I don't need to.  I have seen the evidence, on TV of the bombings and shootings and our wounded and fallen returning home and to conflate her suffering with that of these true victims is shameful.

Sod the French

The French reckon UK is in worse economic shape than the 'soon to be rate-lowered' French.

They may be right.

So let's save some money and cut-back on the money the UK sends to Europe.  According to Wikipedia, the below is for 2009.  Can't believe we have paid any less in 2010 or 2011. 

£3.6 billion won't make much of a dent in our debt but it would help to improve care for our elderly or those in fuel poverty.

Might also concentrate some other Europeans and give them pause for thought before they 'slag off' the UK, when we contribute to the EU and they take from it !?!?!

Might also give those pompous asses - sorry MEPs a chance to consider just who it is that is paying fopr their Euro gravy train

Estimates for net receipts from EU budget based on 2009 budget data
(negative amounts show net contributions)^[4]

Country code	Member state	Per capita (euro)	Percentage of GDP	Absolute (millions of euro)
AT	Austria	−59.7	−0.18	−499
BE	Belgium	90.0	0.29	968
BG	Bulgaria	77.4	1.76	589
CY	Cyprus	−34.0	−0.18	−27
CZ	Czech Republic	150.4	1.11	1,575
DE	Germany	−107.3	−0.37	−8,797
DK	Denmark	−211.0	−0.53	−1,163
EE	Estonia	416.2	4.02	558
ES	Spain	9.7	0.04	444
FI	Finland	−113.8	−0.36	−606
FR	France	−100.4	−0.34	−6,461
GR	Greece	267.2	1.30	3,009
HU	Hungary	265.1	2.68	2.66
IE	Ireland	−35.0	−0.09	−156
IT	Italy	−100.7	−0.41	−6,046
LT	Lithuania	438.2	5.33	1,468
LU	Luxembourg	2364.5	3.05	1.167
LV	Latvia	218.8	2.62	495
MT	Malta	17.4	0.13	7
NL	Netherlands	−90.2	−0.26	−1,488
PL	Poland	160.5	1.66	6,119
PT	Portugal	196.4	1.25	2,087
RO	Romania	74.8	1.24	1,609
SE	Sweden	−43.6	−0.13	−404
SI	Slovenia	92.8	0.55	189
SK	Slovakia	88.8	0.78	481
UK	United Kingdom	−62.7	−0.24	−3,865

Triple A

The French don't like us - Quelle surprise!

According to the (biased) BBC, the French don't appear to like us.  This seems to be news to the BBC. 

Seems that Cameron has upset them by standing up for British interests and (based on recent polls) by representing the wishes of a majority of the British public.

Now the French, in a communitaire act, are suggesting that the ratings agencies should downgrade UK's debt from  AAA to something lower. 

Fortunately the agencies are not yet run by France or the EU (though a proposal seems to be doing the rounds!).  These naughty agencies are not looking at UK rating levels - I guess that little though the UK is doing to reduce debt and the deficit, it is doing something! - instead they are looking at France's rating which seems to be at risk.

Thing I don't quite understand is who does the French Finance Minister think he is fooling?  Or who is listening to him other than for a blogg-able quote to denigrate and denounce? 

Why, when his own jardin is such a mess, is he looking over the fence and criticising the neighbor's garden?

It must be hard being French these days.  Wine is poor, old and over-priced, Triple A rating is about to become a thing of the past and, no that's it, there never was much!

Oh!  I know, Sarkozy  also has to closely watch Merkel's back-side so he doesn't bump into it when this French poodle follows its master.

Public Sector Salaries

On a previous post, I commented on the salaries paid in the private sector.  My view is that it is not the business of Government to tell a private company what it can pay an employee.  That is the job of the owners of the company.

However, the Government can and indeed must set the tone for Public Sector salaries.

Using my previous example, I would set the maximum compensation payable to a public sector official be capped at 6 times the UK National Average, so, £150K.  Again 'compensation' covers, base salary and allowances and pension contributions.

• Any public body, local authority etc., that pays compensation to individuals, in excess of this amount, would be fined £10 for every single pound that they pay, over and above the £150K limit.  
• This fine to be in the form of reduced funding.  
• This fine to rise to £20 for every single pound, if the offence extends into a second year.  
• Again, this fine to rise to £50 for every single pound, if the offence extends into a third year.  
• The public body would be required to notify its constituent audience of the total reduction in funding that it is seeing as a result of its over-paying of staff.
• The monetary value of the 'fine' can be mitigated or eliminated  if, in the same year, the cost of a Local Authority's Community Charge is reduced by 5% or more
•  

Allied to the foregoing:

• All new public sector employees are to be hired on the basis of the only pension package being available being that of a Money Purchase Agreement - that is, no further Final Salary Scheme entrants.
• I am not advocating the abolition of the Final Salary schemes, just no new entrants.

Public Sector seems to include so much these days.  For me this includes, Civil Servants or any employee of a UK Government ministry, Local Authority employees, All NHS employees (Doctors, Nurses, Managers and ancillary staff, all employees of a QUANGO, the police, fire and ambulance service and anyone else that gets paid directly by funds that derive from UK Taxation or National Insurance Contributions.  For me, it does not include active members of the Armed Services

Comments?

Taxing ideas

Here I post some ideas for taxes.

Currently there is much noise surrounding executive pay.  Companies pay these salaries claiming they need to, in order to attract the top talent.  Detractors say that failure gets rewarded as much as success and these salaries are out of touch with reality.

In my view it is not the business of Government to tell privately owned companies what salary levels they can pay company employees.

I also consider that UK taxes are already too high.  Though I don't entirely subscribe to the premise that our entrepreneurs are flooding overseas.

I do agree that salaries at the top have become disconnected with those lower down the pay-scale.  My solution is as follows:

• Establish a multiplier of average earnings - let's say 20 times UK National average.  That would equate to say, £500K per year.
• Change UK Corporate Tax such that any compensation payment that exceeds this level, for any individual employee, cannot be deducted as a company's expense.  So if a Company wants to pay someone £1 million, that is fine, but the cost to the company would be higher because their effective tax rate would grow.
• This to apply to all payments to all employees - not just directors or officers.
• Compensation to include  base salary and any other allowances, car, accommodation, etc., pension contributions, share options that vest or otherwise become encashable within 3 years.
• Change National Insurance rules such that any compensation in excess of the multiplier (  £500K) would be subject to a special surcharge of 25% to the Company and such NI expense would not be deductible against company profits.
• Special rules to be applied to Non-Executive Directors.  For them the multiplier would be set at maximum 3 times national average, so  £75K.  Any compensation (defined above) over this limit would be non-deductible.
• Also for Non-Execs - restricted to sitting on  the board of directors for no more than 3 companies (as an Executive or Non-Executive Director)

So let's say a company pays an executive a compensation package of £1 million.  He/She takes home exactly as at present (but hopefully the top rate is soon reduced and they can take home more)

The company today, can make a deduction of £1 million and thereby reduce it's taxes.  In my proposal the cost to the company would increase by £250K  (25% lost Corporate Tax on the 'excess salary' and 25% NI Surcharge).

I think that when companies and their owners see the effects of these higher costs, they will get a sense of reality.  Also, since this is universally applied, within the UK, I suspect that the top talent might find opportunities in other organisations to be similarly constrained and perhaps not so available.  This might remove the ratchet effect we see these days.



Comments?

Getting less isolated

So the UK has been invited to the table.  Maybe Cameron wasn't, as has been claimed, so naive, after all.

Interesting (and worrying) to see that this accord looks like it may yet unravel. 

The fundamental flaws in the Euro have not been addressed and the politicos and Euro-Crats just don't understand the need for a speedy response and for one that actually addresses the real issues. 

Waffle from Belgium is best served with whipped cream and maple syrup.  When it isn't (and last week's meeting produced a confection  but an inedible one) the financial markets know it and act accordingly.

The Euro-dictators can currently ignore and fail to consult their electorates but they cannot control the financial markets (that's not to say that Canute-like they won't try!).

Continue to watch this space.

UK not so isolated?

So if we look around and get our news stream from other than the biased BBC, we find that other countries are having second thoughts about relinquishing their sovereignty.  Maybe their position was never as black and white as the BBC suggested.  Not a surprise really, politics tends to be more nuanced than that.
Many of the non-EuroZone countries are starting to suspend judgement until they see the text of any agreement.  It beggars belief that after all of this time, the Eurocrats still have not come up with a document.
All the prattle from Sarkozy is the sort of yapping one would expect from a French Poodle with trying to impress it's German master. 
If the next French President is the Socialist and he wants to re-negotiate does that me that they join the UK in isolation? 
Merkel's coalition partners also seem very unhappy.

What has been mentioned, as part of the tentative agreement (not a treaty!) but then quickly glossed over is that under this agreement, supposedly national budgets will be first subjected to reviews by Brussels and only get submitted to local, democratically elected parliaments once they have been 'blessed'. 

No democratic deficit there then!

And then consider, how does this grand solution address the immediate needs?  Italy is still paying close to 7% to borrow.  The agreement won't be up for signing until March.  The politicians might think that the 'markets' will sit and patiently await their navel gazing.  I sincerely doubt it though.  Things might quieten down as we run down towards Christmas and the New Year but come January, things will heat-up again and the Euro will come under renewed pressure.

Keep watching this space!


  

BA Customer Service

Arrived at Terminal 5 - late, even though, per the pilot, the transatlantic flight had 165 MPH tail-winds .  Then forced to wait more than 40 minutes for bags to arrive.
Guess how long it took BA to make any kind of announcement?
What is the point of having a glitzy airport with fancy lighting, glass and brushed steel if you can't even get the bags off of a plane and loaded onto a conveyor belt?  Maybe BAA will/should share some of the blame but I didn't buy my ticket from BAA.
Good news is that BA no longer describes itself as the 'nation's airline'.
Bad news is that BA will be shipping in hundreds of thousands of visitors for next year's Olympics and they, along with BAA, will be the gate-keepers to our country!