VAT slip?
A Treasury document signed by a government minister states that VAT will rise to 18.5% in 2011-12 - which would represent an unannounced 1% rise in the level of VAT now.
The Tories are claiming that it's evidence of "Labour's secret tax bombshell" and claim that it explains "why there is a black hole in the pre-Budget report because at the last minute Gordon Brown clearly decided to keep secret his plan to hit everyone with an extra tax rise to pay for his borrowing binge."
Not surprisingly the Treasury has a rather more innocent explanation. They insist that it's a document that reflected an option that had been considered by ministers but then rejected before yesterday's statement by the chancellor. This fits in with what both I and the BBC's Business Editor, Robert Peston were told in the few days before the PBR.
The Treasury insists that the government has no plans to raise VAT. That, of course, does not rule out them forming those plans in future. Of course, governments of all colours never rule out anything if they can avoid it.
The document is an explanatory memorandum to the statutory instrument (legal document) that enacts the temporary cut in VAT. It's been widely issued and can still be found on a government website. It states that:
"VAT is a tax on the final consumption of goods and services, production and distribution. It is charged on the majority of standard rate of 17.5%. The proposed changes will reduce 2008 until the end of 2009. The standard rate will then return 2010, and subsequently increase to 18.5% in 2011-12."
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its one sure fire way to add to the vivid mess the politicians have created together with thier fat cat greedy scum banker mates and will bring sbout the full force of the people in this country and see a possible revolution.. folk are angry, folk are livid, folk are ready for action, its only you and those your stuck around reporting upon who are blind to this sheer whieghty fact. Personally, I cant wait..
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Now don't let us down Nick, keep it balanced: I've credited you all with a return to neutrality (more or less ...) over the last few days.
Keep away from the leaks & the spinners !
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Disgusting. Brown and his cronies ought to be in prison, not office. Their lies make me feel sick.
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So they are either liars or inept fools (or both)
Which do you think they are?
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And right on cue, Nick arrives to spell out the Governments spin.
Well done Nick, another pat on the back from Gordon
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"This fits in with what both I and the BBC's Business Editor, Robert Peston were told in the few days before the PBR."
Why were you - the media - told anything before Parliament?
Nick - do us a favour and stop the Brown-nosing.
Do some investigative reportage and find out why Brown's claim of Britain being 'well-placed' to weather the recession (sorry - 'downturn') is at odds with the OECD's statement "that the UK will suffer a deeper recession than any other major economy in 2009."
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So a snap election is on the cards in early jan then nick. GB cant afford to wait for unemployment to top 3 million plus, thats why Ally D gave them nice bribes away yesterday
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This comment was removed because the moderators found it broke the House Rules.
There are 8 (eight) blogs on the V.A.T. SLIP, all of which have been referred to the Moderator. Co-oincidence or what? Statutory Instruments are made as part of the Bill, in this case the Finance Bill 2009; so it would have been part of the proposed Budget - Barrister please explain.
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That's a really interesting topic, Nick. There's a lot of things wrong with the quality and degree of information that gets into the public domain. It can be too easy for people to misunderstand or for some politicians to make something of it that has nothing to do with reality. This causes unnecessary complications or attitude that we can do without.
The Prime Minister is right to shrug off Osborne and Cameron and yawn with disinterest. They're just a pair of high status trolls who bragged and swaggered their way to the top. They have nothing useful to say and their popularity is just made up of the wrong sort of attention. Carrying on like that will just buy them another ratings drop.
Osborne and Cameron clearly want what Gordon's got. They ache for his power, prestige, and influence. Behind the lurid rhetoric they're insanely jealous and, from time to time, throw a little temper tantrum because they can't get what they want. Of course, the big secret they'll never admit to is they're Gordon Brown's biggest fanbois.
Ooh, spank me daddy.
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Lord they cant do anything properly can they.
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A good rule of thumb is that governments have plans for everything - for raising VAT, for lowering VAT, for abolishing zero-rating, for abolishing VAT. The fact that one of them accidentally got published doesn't mean that it is some kind of hidden commitment.
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So just to be clear here:
A document that reflected an option that had been considered by ministers but then rejected
Contains the phrase:
The proposed changes will reduce 2008 until the end of 2009. The standard rate will then return 2010, and subsequently increase to 18.5% in 2011-12.
Sounds pretty much like its decided to me, proposals arent worded like that are they!
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Could this be anything to do with the Government not wanting to debate all this in the House. They really are a shower...
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Nick
Exactly what were you and Robert Peston told before the PBR?
I seem to recall that you insisted that you hadn't been telephoned (or anything like that) regarding the budget leaks.
Come clean.
- and folllow up on Mandlesons tariff discussions with Oleg...
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There is no sense of rationality in the Darling proposed/Brown supported PBR anyway.
How can anyone believe that the recession will stop mid 2009 - and then there will be a massive upturn in the output of UK plc?
This is just fairy tale politics and economics.
IF Darling and Brown lined up the super-confident economists who produced the data and data-models that justified such a confident projection of UK rapid recovery, I guess they'd be the guys who created the "global warming hockey stick" model.
I'd like to see their photos and a brief resume of their background experience recorded and placed on a government web-site for the next 5 years.
So, when the "projections" go tits up, I'd like to know exactly WHO Brown and Darling relied on for such fatuous input.
Economics is NOT a science - it's an art-form.
If it has (which I believe) any scientific basis, it should be very carefully treated as "the best guess we can come up with, given the data we can cram into our model".
That's all.
That's why the BoE had to scramble to re-adjust it's prognostications.
For goodness sake, the Treasury and Brown have loads of highly paid advisers to steer them forward.
I'm not an economist.
You don't need to be to realise that the "wonderful" year-on-year "growth" of the UK economy was based on a credit bubble.
That has been evident for years.
What you have to be is completely daft to believe that bubbles don't burst.
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This is hardly news. I expect the government considered a lot of different ways to stimulate the economy.
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So, does the government plan to raise VAT to 18.5% or DID they have a plan to raise it until the recession hit?
Come on Nick, don't just regurgitate government spin, do some digging, like a journalist should!
You might want to ask what will happen to the fuel duty rise once VAT goes back to 17.5%. Will duty drop by 2.5% and keep things neutral or as I suspect, end up being permanent?
These are the questions you should be asking and telling people, not the glossy spin.
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power_2_the_tories,
Your comment is still awaiting moderation but just want to say in advance that it's nonsense. Saves me doing it later.
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Bravo Nick! Can you also drop in that you have been told the Tories have no response to all this and that I am in fact the greatest, most prudent and most handome Prime minister this country has ever had? Can you also say that you and Peston happen to overhear that I am in fact not only the best, I also saved the world from economic collapse? And finally if you can tell people you happen to be told that all these lies about lots of debts and my terrible borrowing during the boom were in act all fiction then who knows, we may talk about a knighthood someday? It seems to have died down a bit, all that fuss over these honours. Lots of love, your faithful Master. Gordon Brown.
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I may be wrong but has no one thought that putting this info in wasn't accidental at all?
I mean, the Government's goal at the moment is for consumers to spend more, however consumers will not do so if they feel that prices are going to continue to fall in the future - so we all hold off spending.
So, the Government realise this and - whether they intend to actually implement the eventual VAT rise or not - the consumers are given reason to believe that prices will rise, massively, in the not so distant future and will be more inclined to spend more now.
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Meeaaooww !! The moggie is out of the bag...
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I've had to put up with people (mostly Tories describing the 2.5% VAT reduction as insignificant, irrelevant and a waste of time.
However as soon as this document was released that suggested an increase of 1% on VAT at a later date, up pops Mr Cameron describing it as a Labour tax "BOMBSHELL".
This sort of double speak does the Tories no good at all!
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Even if the error is genuine as the Government contend, surely the Tories still have a point about a black hole. This could explain the widely recognised optimistic growth forecasts. That is, sensitive to the charge of a tax bombshell and desperate to balance the books, albeit only by the second half of the next decade, the easiest thing to do is plug the black hole with unrealistically high growth forecasts. In the alternative, this is merely incompetence. Not something that instils much confidence from Government purporting to know how to resolve the current malaise.
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They say bad news comes in threes...
1/ Income Tax rise which would affect almost, er, no one - and by only putting an extra 5% on income over £ 150 k would hardly break sweat for those affected.
2/ Suddenly, National Insurance to be put up for, er, well, almost everyone in work...
3/ Er, and now, what was going to a single tax rise affecting only the 'rich and famous', is to be supplemented with a possible hike in VAT which no one will be able to avoid..
Once you've crossed that threshold...
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Which ever way you look at this it shows that the government did not have a clue what they where going to do as late as last week.
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Nick,
What this does prove is that the Government work both you and Robert Peston very hard.
They drip facts to you - so that you can appear all seeing and all knowing.
Unfortunately - it is very difficult given the continuous flow of juicy tit-bits - to avoid becoming a quasi mouth piece for government.
We will have to read the blogs from you and Peston and listen to your TV punditry with even keener ears than before. Which facts are real? Which have been subtly placed by the master spinners that are Labour.
As clever as you think you are - Labour will still work you to play their agenda.
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It is obvious if the economy shrinks and public sector spending is maintained in real terms, and public borrowing rises that taxation has to rise to cover both the recent intervention (bail-out, NR etc) and any temporary tax break given. Or subsequently public spending has to drop and taxation to rise together. Please can HMG advise where the growth is to come from to replace the contraction of the City. This just smells to high heaven, re the 18.5 VAT 'mistake' - you do not sign off a document at a ministerial level unless you agree it. And what is Plan B if the recovery does not come along on cue, or is that the Conservatives. Further - what is proposed to promote lending, advised as essential by the BoE. The economy is not the only thing stalling.
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Sorry, I made a mistake on my VAT. That's alright then, I won't have to pay for it!!!!!
Dream on.
It is a criminal offence to make an incorrect return. It is a criminal offence if the Post Office gets it wrong. It is a criminal offence if your book keeper gets it wrong. It is a criminal offence if your accountant gets it wrong. It is a criminal offence if the Inspector gets it wrong. The only one ever responsible and always pays for it is the tax payer; never those on final salary pensions paid for by the tax payer.
Do not expect fairness - the Tax Payers Charter was abolished by GOrDon along with fair pensions for those that have to pay for the rest of them. Dont' expect morality - money has none, but we expect our politicians to have both a sense of fairness and morality. We expect our Civil Servants to be responsible for what they do, or fail to do.
Dream on.
The person responsible for this "mistake" probably on expenses and a final salary pension scheme will not ever be found accused criminalised or bankrupted because he/she is not a responsible tax payer; just paid for by them and never ever to be identified. If they were, they would be sacrificed for embarassing GOrDon.
Fair? Dream on.
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"Signed by a government minister". The oeprative word is "signed". Do ministers normally sign drafts?
They wanted to hide it - they forgot to delete it. They've been caught with their trousers down and with their hands in our pockets. Not a pretty image.
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You would have thought they would proof read the PBR before releasing it. Darling? Brown? Cooper...? What, none of them read it from cover-to-cover? Go figure.
If they can't be bothered to check the detail on something receiving so much attention, how can anyone trust the level of due diligence on any of their models that show that the economy will recover at the end of next year, or that its appropriate to saddle the UK taxpayer with the most debt in generations without fighting a war.
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Nick
Are you saying that
a) you and Robert Peston were told, in advance of the PBR that Government had considered and rejected the idea of an increase in the rate of VAT to 18.5% in 2011/2012 ?
or
b) that they had considered and rejected the idea of announcing such an increase as part of the PBR ?
What you have said in this blog is very supportive of the Government's position and possibly justifiably so. However, if you are going to go public on the point,l you surely have a duty to be quite specific as to what you were told ?
As a matter of interest, why didn't you report this before ?
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Everyone already knows that the Government's forecast to get out of recession so early is optimistic.
If there is any delay in exiting recession, then of course taxes have to go up under the government plans.
Given all Labour forecasts have been wrong for a long time, they will already need to have contingency plans to do us over for more tax in place.
The PBR showed the most positive spin the government could muster - but of course they won't publish all those contingency plans upfront
Given the announcements yesterday - you'd be mad not to be prepared for a hike in VAT after the "pre-election" give away.
Of course a VAT increase is on the cards. We will be countless billion in debt! It has to be paid somehow.
Luckily there is still one bloke called Keith working in a small business in Essex who isn't on the government payroll and is keeping the economy chugging along. He'll just have to work harder.
Happy Christmas Keith.
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"This fits in with what both I and the BBC's Business Editor, Robert Peston were told in the few days before the PBR."
What fits in? The innocent explanation, or that it is consistent with the Campelson briefings of Mssrs Robinson and Peston. Whatever happened to the end of spin Nick?
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Less of a tax bombshell more like A slogan firecracker thrown the by Conservatives who have nothing of any interest to say.
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Hi
Due to the recent 'budget' this is the only blog I have viewed & commented on.
It maybe it is endemic throughout the BBC but your method of noting the time is annoying and incorect.
08.30 is in the morning and it can be denoted as 8.30am.
08.30pm is wrong it should be:
either 8.30pm or 20.30.
Use the 24 hour system or the am/pm but not both.
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The much-vaunted tax giveaway proves to be the usual headline stuff with yet more stealth taxes tucked away,the cuts are temporary,the rises are permanent.A government who tell all that cutting taxes is the way to get out of trouble in fact raising them and planning significant rises after the next election.Same Labour window-dressing,same Labour disinformation,same contempt for the British Public.Brown says the whole world is doing things "his way",if any other country has just introduced a whole raft of tax increases under the guise of cuts I must have missed that bit...and still no mention of how exactly the self-proclaimed financial geniuses of New Labour intend to fund public sector pensions,PFI payments e.t.c. I'm not sure if this lot are totally stupid or if they just think the British public are.
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Very good Nick.
Not so long ago politicians resigned for breaking the Budget Purdah. Your comment that both yourself and Peston were both briefed on this in advance of the PBR does make you quite complicit in this whole mess, and by extension I'm less likely to trust what you have to say on it.
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This counts as news, does it? "Government considers various options before deciding what to do"? I say well done to everyone who (a) at least thought open-mindedly about various different possibilities before making a decision, and (b) then made the most sensible decison possible.
The fact that people are flexible enough to consider various choices and reject most of them rather than just blindly and in blinkers following a particular line is neither newsworthy nor blogworthy.
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This is exactly how a non-story begins. The pundits in the BBC newsroom produce questions about the Government's behaviour based on a discussion document as though the ideas suggested were Darling's or Browns. They know fully that the whole point of discussion documents is to examine a range of ideas and make choices. As the treasury is stuffed with Thatcherite dinosaurs, you'd expect some many of the secretaries and others to produce these ideas. The Tories, having no ideas of their own leap on this dumped idea as evidence that there is a black hole, whereas, the real black hole is then one Osborne is digging for himself and Cameron. As for the Beeb, serious political journalism seems to have died and been replaced by Daily Mail style sensationalism which gives then impression that the political team is a wholly owned subsiduary of Cameron's Neo-Cons!
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Nothing surpises me more with this mob.
Now i'm going to go back and read the interesting stuff - in the form of comments from REAL people.
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Nick
Seen you on telly - you dont mention
This fits in with what both I and the BBC's Business Editor, Robert Peston were told in the few days before the PBR.
Why not? what exactly were you told? As you are not a member of the goverment, just a member of the public, I think this needs to be examined futher.
p.s. Has Mandleson told you all about his tariff discussions with Oleg? And you have just chosen to keep his secret? You really must tell...
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"A Treasury document signed by a government minister states that VAT will rise to 18.5% in 2011-12 - which would represent an unannounced one per cent rise in the level of VAT now."
No, a rise from 17.5 to 18.5 is rise of 100 x (18.5 - 17.5)/17.5 = 5.7%
You mean to say that it's a rise of ONE PERCENTAGE POINT.
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With all the global crisis regarding the economy, has the UK government and it's citizens considered employing Islaamic Banking? It provides full-time justice to both small and big businesses. This temporary change in VAT will not be the full-time solution for long. Your comments are welcomed(-_-).
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Nothing to say, just saw a big queue awaiting moderation so I thought I would do the British thing and join it.
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I'm on the dole.
I welcome a cut in VAT, the price of my essentials - Bread, milk and bake beans will come down.
Nice one Alistair and Gordon.
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Well, Well Nick I did warn you about the small print:
The small print of the Pre-Budget Report (PBR) document reveals the start of substantial public sector cutbacks over the next five years.
Gordon Brown’s £5bn saving spree: drive on the hard shoulder and delay free childcare.
Hospitals, police officers, nurseries and motorways are set to bear the brunt of £5 billion of spending cuts within two years.
Naw it cant be, not on NuLabours watch!
If NuLabour are supporting workers why are they hitting them the hardest?
I would have thought that he may have pitched the savings at Quangos, that is were the non-jobs and high rollers are.
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#48, are you being ironic? I do hope so as otherwise you are going to be very disappointed....
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VAT is one of the most stupid taxes we pay - and frankly the whole system needs redesignation. If you are a fan of Jaffa Cakes you are VAT exempt, where as if you personally favour Chocolate covered Malted Milks, you will pay a 17.5 (or now a mere 15) % penalty.
You pay the same percentage tax if you can afford a £5000 pair of designer shoes or if you struggled to work to buy your shoes that cost £50?
VAT doesn't make sense, and never really has. And this tiny cut will help almost no one, except the buisiness who wont cut there prices but will make slight ore profit. Clearly a meritable aim for a labour government!
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Your bias is now becoming so blatant that I think you should look at yourself and seriously consider resigning.
You are taking hard-earned taxpayer's money and enriching yourself with it and they deserve unbiased reporting in return.
If you want to favour one particular party then you should take a job outside the BBC.
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the reptiles have got into Darling Bown, and we are doomed!
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It's the same with game development. Features and content get added, modified, and chopped all the time. Nothing is final until it's final. It's also possible to show the media stuff before it hits the public domain so they're prepped before release. This sort of thing happens all the time.
I'm generally pleased with Labour's shift in focus towards quality and kindness. The Tories and their media pals could be headlining that instead of bigging themselves up while talking everyone else into a depression.
As the Osborne's economic grandstanding is creating a danger of destroying an economic recovery, I hope Cameron is pleased that his Baby P grandstanding is causing a real danger that children will be unecessarily harmed. I predict another poll collapse for the Tories as their attempt to win at any cost backfires again.
"Strange things happen at the 1-2point".
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What on earth are all you Tories up in a lather about? Apart of course from defiantly returning to your chosen ground as THE stupid party. And the politically cynical and irresponsible party. ('Let's not have any policies at all on dealing with the worst global recession for eighty years, but let's say "tax bombshell" over and over and over again until we are quite BLUE in the face....")
Get real. In case you Tories haven't yet noticed, unprecedented and previously unthinkable measures are being taken all over the place. Banks are being nationalised either directly or de facto (Citibank the latest), industries are being rescued (US automotive), quite unthinkable sums are about to be poured into the US economy by the Obama administration... And you parochical people are shocked (shocked!) by the fact that the UK Treasury is very seriously considering such things as a 1% VAT hike in a couple of years time. Of course they are. And of course they should be.
You might have been listening a bit too much to the jumped up aristocrats in their pyjamas, Cameron and Osborne, and so perhaps haven't grasped that the world economy is teetering on the edge of absolute disaster. I very much hope that the real politicians and their teams (Brown, Obama, Sarkozy, Merkel etc.) are going to continue to consider all sorts of radical options. Because boy do we need them.
If Cameron and Osborne and their supporters in the kindergartens want to continue to play with their building blocks and their jigsaws, carry on. But forgive the rest of us if we are not very interested in your childish babbling given the state of the global economy.
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Thiirelevation is hardly surprising, is it, the Labour Party has been stealthily increasing taxes over the 11 years that the voters have been conned into returning them. The problem is that the EU is an albatros round our necks and is the main cause, along with the profligate spending of Labour, for our problems.
The sooner we, as a country, stop paying the criminaly ruinous ammount to Brussels for the privilage of being dictated to the better. The saving will pay for all the woes that this government finds its self in and enable a masive tax cut as well.
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In typical cynical Jonathan Cook style, he tells employed experts their job while peddling a negative subtext that's exclusively pro-Tory.
Don't bullshit a bullshitter.
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If VAT on fuel is being reduced by 2.5% but duty is being increased by 2.5% the price remains the same. But for companies who claim back VAT the amount they claim back will be less on the same size fuel bill. How can this budget help them.
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So the "Gordonment" leak, spin and brief - yet they should announce this to parliament first - not journalists.
It gets worse - I hear that Alistair Darling is ducking out of leading for the government in Wednesday's debate on the Pre Budget Report and that his stand in will be Yvette Cooper.
Labour treat parliament and the public with contempt.
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OLinUK (#48) - as basic foodstuffs, bread milk and baked beans are all zero-rated for VAT, so you'll save nowt.
So the government "have no plans" to put VAT up after the next election. Just like they had "no plans" to raise NI before the 2002 election, then?
http://news.bbc.co.uk/1/hi/programmes/newsnight/archive/1937996.stm
Trick me once, you're a fool. Trick me twice, I'm a fool.
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This comment was removed because the moderators found it broke the House Rules.
That's the price of entry to the world's largest economy. You know, your ability to work and live anywhere in a landmass that runs from the Arctic Circle to the Mediterranean and from the Atlantic to the Urals, with added benefits of standardisation and zero tariffs.
Yeah, let's just pull out. All those fat-cat Tory pensioners would have to leave their villas in Tuscany, and business and finance would suddenly find its biggest market clam tighter than a nun in a whorehouse. The thought of being jammed on a sinking mudball with a bunch of blazered buffons is a real slice of heaven.
What, like Osborne and Cameron using it as a platform to ruin the economy and harm children at risk just cuz they want to win an election? Politics aside, I'm really disgusted that people in their position ignore real issues because they're so consumed with their own ambition. And your partial trivilisation of that is questionable at best.
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It wasn't so long ago that NuLabour actually admitted that tax had reached the maximum acceptable by the taxpayers of the UK; that theory seems to have been torn up.
Should we just send our shirts to 10 Downing Street by registered mail?
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#62
Are you a public sector worker by any chance?
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Dear Nick
Britain is NOT WELL PLACED to ride out this crisis, and the Government are ducking and diving the real truth about what Socialismn, has bought on us, Hiding behind Capitalismn, and Globalisation,
When Brown states this you automatically have to think the opposite, he cannot be trusted, Britain is in the mire, and sinking, Woolworth, MFI, Staunch British Companies, decades old, going down the pan, this tells us alot about the economy,
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#63 skynine: "That theory seems to have been torn up".
Let me tell you a secret skynine: EVERY theory has been torn up. The world economy is moving into completely uncharted territory. In case you haven't noticed, the world banking system is now effectively owned by a handful of governments (including our own). Who would ever have imagined this to be possible?
It really is very boring indeed now to come on here and read endless bloggers saying: 'shock! horror! the government is doing things which it did not predict a year ago!"
EVERY government in the world is doing things it didn't think in a million years that it would have ever have been doing.
The question is whether these things will work to avert a major global meltdown in the real economy.
What we can be absolutely sure of is that doing nothing and instead playing childish political games (the Cameron / Osborne position) will be of no help whatosover. If the Tories have nothing to contribute to our current difficulties, they should have the decency to keep their adolescent aristocrat mouths shut and spare us the meaningless babble. Brown and Obama and Sarkozy will meanwhile get on with actually addressing our problems.
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This is incredibly disingenuous on the part of the Tories. They surely know that governments consider all sorts of options before announcing policy. The fact that this particular option made its way into a draft statutory instrument doesn't mean a great deal. The Treasury would presumably have prepared draft legislation to give effect to all the options under consideration in order to be able to legislate for the chosen option promptly once the decision was made. What this really shows is how desperate the Conservatives are becoming.
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Nick, wouldn't you make more as one of Gordon's spin doctors? I know you'll say your job is to report the news, not to test its veracity, but if this were a Tory document you and all the other BBC political correspondents would be over it like a rash, questioning evey figure and challenging every supposition.
I'm sure its true that political correspondents have to tread carefully, but there is a world of difference between that and becoming a mouthpiece for government propganda. The kindest word to use about your approach (and that of your colleagues including the famously challenging 'paxo') would be craven.
As a very worried taxpayer - oh and the licence fee too - I should like you, or anyone at the BBC, to tell me exactly what this is going to cost me - an ordinary rate taxpayer. It's a nonsense to suggest that the tax from the rich will cover it - by the time their accountants have worked it through they probably won't pay a penny extra.
I'd also like to know what the non-governmental consensus is with regard to the likely length and depth of this recession - just how overly optimistic is Gordon-as-darling being? How much extra, extra tax will I have to pay if he is out by a year on length, or say fifty percent on the growth figures post recession?
We all know it's a gamble - we don't need 24 hour news to tell us that - what we all want to know is how big a gamble - with detail.
Cheers,
Charles
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#62 CEH
"I'm really disgusted that people in their position ignore real issues because they're so consumed with their own ambition."
Charles I actually find myself agreeing with you for possibly the first time. You've summed up exactly how I feel about Gordon.
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I don't know why NR has thought fit to introduce this item. It's yet another red herring and is nothing of importance in the grand scheme of things. Who on earth is interested in what might have been? The actual measures and their impact are what is important here.
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I recall back in 1991 that the rise in VAT from 15% to 17.5% was to replace the government income lost through mass non-payment of Poll Tax. It's nice to see that now Council Tax has been introduced, the VAT rate has at last reverted to 15%!
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HANG ON - THIS WAS SIGNED AND DATED THE 24TH.
FESS UP NICK.
This isn't an old draft that was accidently released.
If what you say is true STEPHEN TIMMS signed the wrong document and noone noticed at the time!!
When Blair took us to war with Iraq - was that deliberate or did he sign the wrong document?
STEPHEN TIMMS SHOULD RESIGN
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Does anyone really care?
Irrespective of budget proposals, surely what matters is that the country and its people are in trouble if measures aren't put in place?
The consequences of raising taxes later must be better than having millions dependant on the State now and not being able to contribute Taxes later, surely?
I can't understand why Osborne and Darling both didn't put Party games (sorry Politics) to one side and go forward with what could be done, rather than what cannot.
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We're heading for 1 trillion of debt by 2012 according to the government's own figures.
And by the way, who would put a red cent on this forecast actually being met, when they've missed their borrowing targets by miles over every budget in the last 10 years.
So how would anyone other than a half-wit refute the suggestion that one way or another we're going to be taxed to the hilt come 2010 and beyond?
It doesn't matter what is planned or not planned, admitted or not admitted at this stage, whoever wins the next election is going to be putting up taxes of all sorts.
The election campaign will be about which party can lie the most convincingly, and try to pretend that it ain't going to happen - and unfortunately Brown is world-class in this respect.
It's a question of whether you can stomach 5 more years of this bunch of liars and charlatans or try the other lot.
Brown is going to go down in history as an utter disaster for this country, but he won't worry. He thinks that there are enough stupid people in the country to actually believe him. And it's probably true.
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First the typo in the PBR.
The Tory leaning posters who have spent the last weeks informing us how utterly incompetent GB and AD are find it unreasonable that they made a cock up in proofing of a 200 page document which they no doubt changed with pencil margin notes dozens of times.
Now whilst it is clear and admitted that the increase was in the original document I have no doubt following the weekends papers and soundings of their MPs it was decided against and removed but they forgot the text was already at the printers - so yes it's a cock-up - par for the course with them.
If the economy doesn;t recover on the lines predicated we do however know where the next increase is likely to come in taxes.
It also tells us I believe which branch of the business community has the ear of HMG at present - that being the small business community hence the rattling on with VAT which seems to overly exercise small business due to the mucking around with flat rates, registered or not that what should be a reasonably simple tax to understand and work with. Hence they have also cocked-up even the 1% decrease.
If Osborne and Cameron make this mistake the central plank of their attack in the debate then they will miss the target by a country mile. It is the easy target but it is the wrong target.
Frankly the most useful think Osborne could do is resign his post and let Ken Clarke have a go - Darling would be toast. I can;t forget both GO and DC we are told are suited to this crisis because of previous experience advising previous chancellors and economic policy. Unfortunately it was the worst Tory chancellor in recent memory they advised and their economic policy experience was honed at a time when they had nothing to offer.
No they rightly tell us it's a crisis and unprecedented - so move over and let experienced hands who were active at the prudent times take the lead.
And lest the screaming Labourites accuse me of harking back to Thatcher - no we do not need that brand of economic mismanagement at this time either.
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Hmmm. Nick, if, in the few days before the PBR, you and Robert Peston were told something consistent with a VAT increase to 18.5% being rejected, why was his blog over the weekend suggesting that VAT might go up to 22.5%?
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Where to start?
#14 Carrots
Well said. The phraseology that was used says it all.
#17 Real-Truth
Well said. Parliament has been well and truly sidestepped over this. Don't you think it's frightening that we're all crying out for an election, but to what? A toothless dog, which is what it is under this maladminstration.
Has anybody actually read anything the tao master's written? Can't be bothered with hs twaddle any more.
Nick,
where are all your high-minded principles about not haveing somebody else set your agenda?
Why aren't you criticzing the government for leaking?
Why aren't you questioning more about inconsistencies in government rumours?
As far as I'm able to percieve anything, whatever we get from the government is a rumour, even the PBR.
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The Tories rather ironically have now adopted the Neville Chamberlain position in politics. "Crisis? What Crisis? I am sure if we do nothing everything will work out fine. The threat from Mr Hitler (global meltdown of the real economy) is nothing to get too excited about".
It's really sad. The Tories are like a bad health service adminstrator in the MASH field hospital as the bodies are beginning to be flown in, tapping their calculators and clipboards and saying: "We better be careful with those blood transfusions. We don't want to have to ask good middle class people for more donations in two years' time. Probably better just to let a few of these poor people die now".
Not a pretty sight to watch grown men not only completely out of their depth, but focused 100% on party political advantage. Cameron and Osborne fortunately will pay for this politically. The public knows that we are in a terrible mess and something needs to be done. The Tories won't fool them that Neville Chamberlain was right.
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#76 protesting_in_vain
Good point!
Who reports on the reporters Nick? if the third estate are in cahoots with the Government where does that leave the public?
Just shows that the public really have to keep the government (and their BBC cronies) from intefering with the internet -- its the only way we get genuinely free speech.
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I wonder what other Treasury documents might be hanging around giving indications of future income tax levels, vehicle excise duty figures, fuel levies, council tax and anything else which would be more transparent evidence that things are just about to get a whole lot worse-big time.
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First, if this is like 'game development' you forgot the version control and configuration management.
In other words, you keep the discarded stuff well away from the current version.
This document is very recent, dated the 24th.
Based on Labour's record in government; I don't believe a word they say. I doubt too, neither to the British public.
As for win at any cost, that's rich.
So that PBR wasn't partisan, targeted at core votes and designed to skewer Cameron?
Oh no, no. Then again I like my pork chops with wings on.
As for the media, proof positive they have been suckered again by Labour's news management. There will be those found to be complicit with their 'narrative'.
Just like newspaper editors being in the 100,000 to 150,000 a year bracket, they have just made every political journalist look very stupid indeed.
No surprise then that this story is going to run.
As for the Tories lead shrinking, I don't think so, despite Labour's dog whistle attacks, I think the Tories are getting the upper-hand.
This might be news to you but this government's economic prowess being worse than Callaghan and Healey's is not a vote winner.
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I find it hard to believe what the BBC says these days.
Information not forthcoming, then when the government find themselves in a hole someone (no names) says, "Oh I knew about this all the time."
Disingenuous I think the word is!!!
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I don't understand all the fuss about the 18.5%. Most market commentators, and definitely most bloggers, seem to be off the opinion that a cut in VAT from 17.5% to 15% will have a negligible impact on the purse i.e. £1.25p for every £50 spent. Yet when this is reversed and we could see an increase to 18.5%, its the biggest and worst thing that could happen? Surely this cuts both ways. Either the reduction will help, in which case its a good move and needs to be paid for in the long term (with a reversal in VAT seeming a fair way to do this), or the cut won't make a difference, so the temporary cut and then increase (if it happens) don't matter.
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@74
You wrote, its a question of whether you can stomach 5 more years of this bunch of liars and charlatans or try the other lot.....
Well i have been reading nick,s and prestons blogs for sometime now and think the people who write in have more of an idea on how a country should be run then the mupets that are in parliment now. they should form a goverment and lead the people. so much talent being wasted, while them who run our country waste us all.
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There is a saying in Calcutta 'carefully careless' - may be ploy to leak the news that it is due anyway.
Also by claiming that till 2015 books cannot be balanced, in one sweep Brown?darling have covered up all their borrowings of previous years.
Prime Minister may say 'sweet nothings' like fuel costs would be reduced and so will energy costs but taxing fuel now and not taking any action on energy companies only shows that Labour cannot be trusted.
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"Whistling_Neil wrote:
First the typo in the PBR.
The Tory leaning posters who have spent the last weeks informing us how utterly incompetent GB and AD are find it unreasonable that they made a cock up in proofing of a 200 page document which they no doubt changed with pencil margin notes dozens of times."
Typo? TYPO?
No, this wasn't a typo. It was a tax rise and they were keeping it quiet. It wasn't a typo!
The NuLab Spin Doctors are revolving at generating speeds today.
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#62 CEH
I'm really disgusted that people in their position ignore real issues because they're so consumed with their own ambition.
So am I, Charles. Labour are the party of self-interest and you've just described them to a "T".
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For anyone criticising the Conservatives for not saying what they would do in two years time, I suggest you look at your own finances then tell us what your financial position will be in two years time.
Are you sure you will have a job?
Will you have defaulted on your mortgage?
etc.
Todays news on VAT just backs up the fact that there is just too much we do not know to make any predictions that far ahead.
Too much is hidden away and not in the public demain.
The country is in a mess - all we have is hope and prayer.
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Is Stephen Timms going to be sacked by Brown, he signed the official document !!!It would not be a bad thing as poor Mr Timms seems to be quite clueless and out of his depth when he appears in the media. He learns the official lines of the day and repeat them ad nauseam.
While Gordon is at it he would do well to get rid of Mrs Cooper Balls too ( on very nice income, double housing allowance and who knows a lot about the struggling families !! )She looses a few votes too everytime she is on the air !!
These Treasury ministers are either a bit economical with the bad news or even worse incompetent . Who is the last Labour minister who resigned for any of these two faults?
When they are being found out they send a poor junior minister to tell us it was a genuine mistake,pull the other one , show a bit more respect for the British public and voters!!
Can you imagine the Labour fury and their media reaction if the situation had been reversed.
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Is this tantamount to fraud?
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83 tom.........
No a move to 18.5%would matter.
It would occur when national insurance was punishing everyone on over £19000, thuis pushing up the price of many items at a time when your disposable income was stable or going down.
Result slowing down any possible recovery.
There is a great big black hole in the government's recovery figure - this would go some way to filling it.
It is very important.
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The BIGGER question is what other tax rises were they planning that have been DELETED from the PB report?
Perhaps Nick or Robert could have a quiet word with "Deeprecessionthroat" on behalf of the nation?
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I am really starting to get tired of all this now. I really dont see that this cut in VAT will help at all. What we needed was a different approach such as reducing income tax for the 13 months instead.
This would have put money directly in to the pockets of the people that politicians seem to forget put them in the position they enjoy.
Also, all you hear are the tories making noises about how this wont work and that wont work but I have yet to hear the ideas on what would work.
I think this is one of the times its better the devil you know. Just start being honest with the public.
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#62 (CEH)
Just a reminder that it was Darling who said that the UK faced the worst economic conditions for 60 years. And for your information Labour have been in power for the last 11 years. But hey, it's all those wicked Tories' fault.
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This whole situation is becoming very shameful.
We are facing the worst economic crisis in this country in living memroy.
We have an incompetent government, who have been in charge in the entire build up to this farrago.
They have been shamed into an emergency debate on the matter.
They have been lying, there is no better word for it, about the extent of the problem, the cause of the problem and now, it seems, a suitable cure for the problem.
You, Nick, have been complicit in this since, by your own admission, you were in possession of facts not known to our elected representatives before they should have been known.
Therefore you know who is the source of the information. We are only guessing, but I bet it's the same pair of people at the bottom of it. And bottom is a very apposite term.
As proof of their level of incompetence they allow an uncorrected error to get into the public domain. For a government that has responsibilty for so much lost personal data over the last two years it is only par for the course, and we aren't surprised. This time its them that's getting hurt, which is only fair.
The government, and many of their apologists, think it is reprehensible somehow for the opposition to oppose some of the governments actions, on the basis that it's for the good of the country.
We all know, from experience, that this lot will proceed to claim full credit for any improvement, and be quick to switch the blame onto "shared responsibility" if it all ends in tears.
If they had an ounce of decency and were prepared to accept responsibility for our plight, they would call an immediate election with the economic situation as the sole platform.
If they get a mandate to fix the problem, then everybody should fall in behind them. If not, move out and let somebody else solve the problem.
Do I expect Hugh Jeers and his cohorts to act honourably? I'm going for a win double on that and hell freezing over, where I understand that an investment of 1 million might produce enought to pay off all the national debt.
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#93 mranderson
We've had the devil we know for the last 11 years and they haven't been honest wth us in all that time, so what makes you think they would change now?
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Leave Nick alone! Don't shoot the messenger you idots!
Damned if you do, damned if you don't Nick.
You are lucky to have this forum - don't saw off the branch you are sitting on chaps!
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Yup. Simon Heffer sounds bullish (after lifting my material) but went down in flames during an interview, and was left scrabbling as he called Sweden the North Korea of Europe and clung to Switzerland (???) as an economic model. The Tories and their media pals are stretching a bit and it shows.
One thing some folks don't get is the uncontrolled city and greed undermined foreign investment and drove people out of the country. All the talk of brain-drain is just Tory scaremongering to cover up the costs of the Thatcher legacy. By using the crisis to focus on developing business and fairness Labour can reverse this trend.
Gordon Brown has a black belt in leadership. Osborne and Cameron don't, and it shows badly. It's why Gordon is leading the charge around the world and the Tories have boxed themselves in as day players. Yeah, I some mouths around here like to spin it differently but you can't buck reality.
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I think Darlings statement saying "there are no CURRENT plans to raise VAT"says it all.
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#67 SanchoP
"What this really shows is how desperate the Conservatives are becoming."
Hello, newbie. What a mild and measured first post. Think you got it wrong about who's becoming desperate, though.
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Post 93 mranderson78
In answer to our question this is what I posted on Robert Peston's blog yesterday....................
Darling has really cocked up with this VAT wheeze hasn't he?
Yes the intention is good but the implementation is truly awful!
If I were Chancellor this is what I would do to get the money people have into the hands of the retailers.
Stage 1. Reduce VAT to zero for 3 months.
Stage 2. Increase VAT to 7.5% for the next 3 months
Stage 3. Increase VAT to 10% for the next 3 months.
Stage 4. Increase VAT to 15% for the next 3 months.
Stage 5 Increase VAT to 20% forever after 12 months.
This strategy would give consumers per perpeual perssure to spend spend spend thus creating an improving floor in economy.
Darling approach is just not bold or imaginative enough to get people into the shops immediately!
Now, with the housing market. That is simple too!
All the Gov't needs to do is announce (and fund) a scheme giving anyone buying a house under 120K a 20% deposit guarantee as a charge against the property on a shareholder basis.
This 20% charge would be up to ?24K on my proposals but wouldn't be a "cost" just a varying asset to the Gov't books. However it would mean that the buyer who may have a deposit would use this for new items for the house i.e.furniture, carpets, etc thus injecting thousands back into the economy immediately. However it get better because all those chains above these first time buyers then get going too with works for removals, solicitors, retailers, gardeners, banks and estate agents, builder and even stamp duty for the Gov't.
Result? Well each house sale chain has about 4 transactions on average and with an average level of economic activity generated per transaction about ?7,500 this would inject at least ?30,000 back into the economy immediately so it would be self-financing.
In fact the Gov't/taxpayer would have a 20% stake in the property which would eventually rise, the lenders would be more than happy to lend only 80% LTV and many people would start moving again thus stopping the halt in falling property prices.
I sometimes think Politicians and Economists are just plain stupid!
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Dear Nick,
Next time you are round for tea and biscuits could you please ask Mandy, or some other source, this little question.
Does the increase on National Insurance of 1% mean an increase in funding for the National Health Service, or is this increase just a tax to fill a hole, which would mean NI is just another tax for the workers?
Last time NI was increased, it was put out these increases would be ring fenced to go directly to the NHS. Is this true now??????
Xxxx
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Aw, man. You Tories must be in shiny eyed panic if you agree with anything I say. Took you long enough to come around to my position. But, that's okay. Don't mention it. I just talk crap that nobody reads. LOL.
Darling had the measure of the situation which is a bit different to Osborne trying to scuttle the ship. Since then, Darling has become more media savvy while Osborne is busy blasting a bigger crater.
"Strange things happen at the one-two point".
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You people are really living in some sort of parallel universe disconnected from the reality of our current dire global predicament. In which the main event is a leaked UK Treasury document about an optional minor tax raise in a couple of years time.
Let me let you all into a secret: no Western government has the remotest clue what it is going to be doing fiscally and economically in 2011! (Or indeed in the middle of 2009 for that matter.)
Let me tell you one perfectly possible 2011 scenario. The Western banking system has been fully nationalised and is now run totally by governments. The US defence industry, and key technology suppliers such as IBM, have also been taken into effective public ownership. Interest rates have been at 0% for a year, but economies are still shrinking. There has been massive consolidation in the mining, shipping and natural resource sectors (the BP-Shell merger was a noticeable one). Sterling joined the Euro in a panic measure to avoid a massive run on its currency. Falling commodity prices have led to economic meltdown in Russia, which has effectively cut itself off economically from the rest of the world. China has stopped lending to the US and the dollar has plummeted through the floor. Gold prices have rocketed. The US has introduced curfews in its major cities to stem endemic rioting and looting....
Given what has happened in the last few months alone, this is all perfectly possible. THIS is what we are dealing with here.
Could we all take our parochial heads out of the ground, open our eyes, and start to talk seriously about the grave dangers which are facing us?
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#101 Northern Thatcherite
On your last comment, why only sometimes?
I think these people get some kind of qualification in stupidity.
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The people who brush this off as a minor cockup should take note of the huge amount of law that labour pass by 'executive instrument'.
Labour have put many laws through parliament that include clauses allowing the government to make changes without further reference to parliament.
How many other 'cockups' (if that is what you belive this to be) have gone and are going through on 'executive instruments' with out being noticed?
The instuments themselves are a direct attack on democracy - but to have the added risk of errors going through is even more concerning.
And before any trolls pile in with 'don't worry, its rare' etc... We already know there are endless cockups (i.e. data loss), and they are only the ones the we hear about.
Nick has already confessed that on more than one occasion he has withheld information from the public, and robert peston has written columns containing ideas he knows to be untrue - if we can't trust the government, how much less can we trust journalists?
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The govenrment now has no credibility.
They lost the benefit of the doubt many months ago; but now all credibility has gone.
VAT is clearly planned to rise.
Spending cuts of 37bn will be bigger than the cuts the tories proposed so htere is no longer any argument for the government that we cannot afford to cut front line services.
There is now a clear dividing line between an incompetent, spendaholic, deeply indebted govenment of cover up and spin ... and the tories. It's as simple as that.
We are straight back to the seventies with an incompetent labour government that has lost control of the finances and lost control of who supported them in the first place.
An idealogically bankrupt party leaves a fimacially bankrupt legacy; what neat symmetry there is to newlabour. It's about the only thing about them that does work.
A vote of no confidence should now be held in the government's PBR; it is ill thought out, ill intentioned, inaccurate and incomplete by the looks of things. This is not a way to run the country.
Call an election.
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Suggest computer games salespeople get a copy of the Daily Mail shipped to them across the pond or OZ wherever they lay their hat. It has the biggest sales of all papers here old boy.
Clear which party is most supported and games and martial arts don't come into it.
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Another example of the contempt displayed by this disgusting government for the people of Britain. No level of depravity is too low for these overpaid underachieving drones.
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Read this
http://www.conservatives.com/Video/Webcameron.aspx?id=e4f1c1a8-1f61-4be0-83ab-4ca36a915740
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Interesting. One of my comments got referred to the moderator? Why? I did not say anything that was in breach. What i did ask was why again Peston was told something that subsequently helped the government. As happened with the Corfu question.
Why on earth was that sent to the moderator? Again. Peston and you just happen to be told that this was a plan they discarded.
In fact you say:
"The document is an explanatory memorandum to the statutory instrument (legal document) that enacts the temporary cut in VAT. It's been widely issued and can still be found on a government website. "
But that is hardly an excuse because today the government announced the posting of this document was in fact a mistake.
So things don't add up.
You have been told yet never reported on it (in the pre budget leaks that were there for us to hear).
You then say that it is actually a document that you can find on any website. But then the papers tell us this publishing of the document was a mistake.
Nick I think you should pay more attention when Downing Street is leaking, because you aren't reading your briefs.
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#98.
Delusion.
Here's some reality...
Brown's spending cuts is the PBR. Which schools and hospitals will Labour close as they half the growth in public spending to 1.2% after 2011?
After all, that was the accusation Labour made of the Tories only last week. So how is that a boxing in of Conservative policy?
How does taxing wealth creators more make them want to stay?
How is our slipping down the international competitiveness league good for business?
How is soaking small, medium and large business with successive rises in corporation tax over the last two years good for business?
So much so, they are re-locating to a more tax friendly country like Ireland.
How is a public sector with falling productivity over the last decade value for money?
Net productivity is 20% down on 1997 levels.
You might want to lament at Heffer's lack of economic role models.
The OECD has plenty, they have reported that the UK will suffer the worst recession of all the major industrialised countries.
Who said:
The Labour luvvy toff of Tuscany herself.
Some caring, sharing, fairness there for those in fear of unemployment or have lost their job. I'll overlook the total ineptitude in her understand of deflation.
Is that fair? Through no fault of your own, a government has got it so badly wrong they lose their job, home and possibly their marriage?
That we have an unelected leader leaving a litany of broken promises in his wake as he tries to stick one on the opposition?
Do you understand the meaning of contempt?
Go into any economic text or paper and try and find the word 'fair'.
There is no concept of 'fair' in economics. It is a mirage, it does not exist.
Labour can't even offer competent and sound administration, that much is patently obvious.
As an electorate, people have the right to be told the truth, the facts and then decide.
Labour isn't working.
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Not really newsworthy is it? The Government must consider a few hundred things a day and reject a fair few of them. I'm guilty of this myself in fact. What next, Brown and Darling consider a fish and chip supper?
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#96
I am living in hope that they might start being honest. In actual fact I dont trust them at all. Just keeping my fingers crossed.
#101
Spot on. If there was a more measured approach like this then it may have worked much better. The cut just seems like a token gesture but structuring it in such a way would have a much better effect.
Just a pity there is no one in the treasury that can come up with this.
Reading through the forums a lot of people seem to say the same things which make sense to me. Think someone should start a forum political party so some sense can be brought back :).
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how exactly is this tiny drop in VAT going to mean I have more money in my pocket at the end of each month?
shops will still charge £9.99 for goods (example), and even if they did drop to £9.77 (or whatever), I still don't have £9.77 to buy that thing with
The majority of my outgoings don't have VAT on them anyway (or if they do, they're "exempt" from the drop!)
I agree with RobinJD - Vote of NO CONFIDENCE IN THE GOVERNMENT.
They clearly don't live on this planet and have NO CONSIDERATION for the people of this country.
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#5, "So they are either liars or inept fools (or both)"
..... and every reference to this "accidental" publication of a possible rise in VAT.
= = = = = = = = = = =
There is, of course, another possibility.
Almost all, on here and among the experts, are agreed that a VAT rate cut from 17.5% to 15.0% will generate virtually no savings for most of the population, and add no stimulus to the economy.
The prospect, however, of a double hike in VAT from 15.0 to 17.5 in Jan 2010 and then, again, to 18.5 (or higher) in 2011 (or earlier) falls precisely into line with one of the main PBR forecasts.
Mr Darling was very certain that his actions would stimulate the economy by the 2nd quarter of 2009 . . . . . . and now we have been told his real incentive for this to happen.
It should be borne in mind that most EU countries have standard VAT rates between 19.0 and 20.0, so a move in line with these is more likely to be the "cunning plan."
A scenario of General Election in May 2009 followed by another budget, which includes a permanent VAT rise to 20.0% set for Jan 1st 2010, is my own take on this!
To be honest, whoever wins the election will HAVE to do so to get close to even balancing the books.
As Jim Royle might hypothesize:
"A leak? My A###!"
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For all the people who condem the Tories for doing nothing, all they are doing is pointing out
if you are in a hole stop digging
This year the govt says its going to borrow GBP 78billion,half that amount is going to be consumed in debt repayment.
Next year we are going to borrow GBP120billion,at least 50billion of which will go in repayments
So in the time frame of the govt is injecting a fiscal stimulus of GBP 20 billion into the economy, 90billion will leave it to go abroad
The government wants mortgage lending to go back to 2007 levels. To fund this the banks borrowed GBP600 billion from abroad.
How does borrowing that sort of money to be sunk into unprodutive bricks and mortar,most of it already built,with the money being recycled into the mortgage market with a 7% interest charge being extracted most of the interest going abroad
This is the economics of the mad house.
Whether we like it or not we are going to have start paying back debt, letting houses fall in value so we can go back to sensible
multiples of income freeing up money to be invested in pensions and shares to give us an income in old age,when we cease to earn
That is doing what we used to do under the Tories, giving us a pension pot worth GBP900 billion,double the total invested in the rest of Europe combined.
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Or could it be that following all the press/expert reports that 2.5% vat cut wouldn't work- someone "leaked" that post the cut it would rise to 18.5%- even saying that was thought of but cancelled - so mmmm??- we wonder -could that mean it might go up higher still- thus they hope that this will up the incentive to spend sooner rather than later which is what they think will solve the problem. In other words it's all SPIN + vat.
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Many comments here are based upon an ignorance of the workings of the government or a blind bigotry regarding anything to do with the admittedly far from perfect government. In my brief experience within a Government deparment I know hat ministers will always seek a range of options to achieve a particular aim, many of which, if not all, wil not accord with ministerial wishes and many of which, if not all, will get rejected. The fault here is with the publication of one of the options. I suspect, however, that some of the pub commentators on this page would be a touch more irritated if they thought that civil servants ruled the roost and suggested to ministers that there was one route to achieve its aims and one route alone.
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Crikey, every time Labour mess up and Brown faces a hard time on this blog the usual suspects drop their facade of worldliness and the Conservatives get accused of causing distress to children and having no policies.
Let's debate the issue.
Which is that there is a black hole (because the revenue forecasts will be missed by a large margin - typical optimistic hockey stick projections) and all of us should be interested in the Government's plans to finance the shortfall.
If we focus on VAT at 18.5% we are missing the rest of the iceberg.
Take a look at this and then go figure the tax implications:
http://seekingalpha.com/article/107818-uk-government-debt-will-double-and-tax-rises-will-follow-tax-cuts
What do the Government know that they haven't had the courage to tell us?
The questions raised by Cameron do not reflect a sudden change in the relative importance of VAT - as suggested by some on here - but reflect a concern that the PBR is a less than honest statement.
No surprise there then.
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The Chancellor said "No hidden manifesto, everything above board"
At the time it sounded a bit clunky that phrase didn't it?
When I heard him say it I thought, this is Alistair Darling trying to show that he is his own man and that he wouldn't be attempting any of the devious tricks that Gordon Brown used to in his budgets.
Having seen this - it seems apparent that the government know that they have a risky policy and that taxes may well have to rise to levels greater than they are indicating now.
I'm sure the additional VAT rise was removed because it would have taken the shine off of the VAT reduction which they hoped would be very popular (oops).
The PBR was a very political budget and seems to have little effect as an "Economic Stimulus".
I imagine today's emergency debate will not manage to change the budget and that the the Labour party will push forwards with the most expensive suicide note in the history of British government.
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So let me get this straight - this was proposed but dropped. Mmm ok. Then what else was proposed and dropped? They might as well come clean on all they were proposing to do.
The only way out of this is to drop ID cards, cut the bureaucratic mess created by this government and tighten the government's belt - especially in their pension scheme. Unfortunately this will no doubt hit the lower paid civil servants and not the fat cats at the top. Surely during these times, these fat cats should be treated in the same way as bankers - no bonuses, cut in salary - maybe working for £1 like the AIG Chairman?? Maybe Gordon could lead by example. Now that would be public spirited!!
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Cobber950 #117, you are a very dangerous man indeed. It is the absolute height of irresponsibility on the verge of the worst recession for eight years (and perhaps worse) to be proposing that we start repaying debt. This position absolutely beggars belief, and I am being charitable in assuming that you are only putting it forward for some kind of cynical political reasons. Nobody could be that stupid.
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Just a small point.
If VAT did rise to 18.5% later, it would be a jump from the 'new' 15%, not from the current 17.5%. A sudden increase of three-and-a-half percentage points might be more of a shock-in-the-wallet than an increase of only one percentage point.
Psychological maybe, but worth thinking about.
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So some plonker forgot to change the webpage for an idea which was obviously under consideration up until a late stage.
The idea was discarded and Darling announced what we all now know.
Maybe there will be a future change in plans from the idea to go back to 17.5%, but thats all.
Let's keep things in perspective, it ain't happened and it may not happen. Full stop. The BBC speculations occupy far to much air time and some may consider them actually rather mischevious and morale sapping.
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I found Nick’s statement below quite remarkable:
“This fits in with what both I and the BBC's Business Editor, Robert Peston were told in the few days before the PBR. ”
So the ‘independent media’ is getting secret briefings before parliament, its hard to retain much hope for the BBC. What are the terms and conditions of these briefings, are there any payments involved, what limits are there for attending them?
It would be naïve to imaging that briefings such as these are not in part to observe reaction and media questioning. Its must be so much less tedious than in the past where things were actually debated in parliament, for a very long time governments have presented prepared packages to parliament and voted them through. These media briefings are part of the emasculation of democracy and its hardly out of character to find the BBC stage centre again.
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126 responses before mine. Seems like the Mandy's distraction has worked. I wonder where the old fox is running, while people are following the false trail.
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Some are saying that there is a 100 Billion black hole in the finances and that the "VAT slip" causes suspicion that there are further hidden taxes.
I'd like to see the calculations that give the 100 Billion shortfall in taxes. Anyone know how this figure is calculated?
Surely no government could publish a budget with a 100 billion tax shortfall??
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The issue is not whether or not this represents a 'secret' tax rise or is simply a clerical error. The point is that this was being considered at the highest level as a plausible tax rise just days before the PBR.
Given that the tax rises announced by the Chancellor on Monday will struggle to fund even those wildly optimistic borrowing projections used by the government, only a fool would believe that this isn't going to happen at some point.
It certainly won't end there though. I can't think of a budget in the last five years in which the borrowing projections have been remotely accurate. The problem is that this time those inaccuracies are going to lead directly to a higher and higher tax burden.
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Why are most of the BBC political broadcasters on the side of Labour, well apart from Andrew Neil who seems to be the only neutral one? So Nick Gord's explanation matches yours. So why didn't you mention it when you and Preston were on the daily Politics show on Monday.
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Not that it's going to happen, 124, but the leaked option was for the increase to 18.5% to follow a year after the return to 17.5%, so not quit the shock you suggest.
I should add to the above, before some here carry on referring to the disingenous Labour Party, that in 1979 the Tories rubbished the suggestion that they would double VAT, during the run up to the General Election. I can also recall going to a meeting at which Edward Heath was speaking (I wasn't tere as a supporter, I should add!). My brother asked this very point, and Heath ridicled the very suggestion. 8% before the election and, if my memory serves me correctly, 15% thereafter, thanks to Sir Geoffrey!
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This is the shape of things to come as a result of Monday's Fudge-it.
I think "rejected" really means: "put on the back burner".
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126. Spot on. So in fact Nick is saying: yes of course I get briefed (this government is the worst for leaking after all). It is amazing how they then report on this. Same as with Peston and Corfu. He was told certain things so it must be true.
Great reporting! Is this where my hard earned £ are going to? Leaks by a government in trouble?
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This comment was removed because the moderators found it broke the House Rules.
#38 quote: "It maybe it is endemic throughout the BBC but your method of noting the time is annoying and incorect."
Er... the government has released a budget hoping to help an ailing economy, which it probably won't, will instead mean huge tax rises, and they have possibly deceived everyone in the process, and the best you can comment on is the way the time is displayed on the page.
I presume the credit crunch hasn't affected you yet then?
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Amazingly I'm still reading posts on here from government apologists who recommend dropping any criticism of the "planned" hike in VAT because it hasn't happened.
Some of them are the same people who were hounding Osbourne over his "non-dsicussions" about a donation to the tory party with Mandeslon's mate (funny how he was involved?).
I know that supporting a political party rather than some other political party requires dogma and, in some cases, blind and utter faith but, purlease.
If you really believe that what they have done, have announced they will do, and probably come up with some other good plans in the near future, and all of these are right, then join the calls for an election on that basis, and that basis alone.
Then we'll see.
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To offset the VAT reduction on petrol the Chancellor said the duty on petrol would rise. Actually fuel duty will rise 2p per litre. Businesses can reclaim VAT on business expenditure but cannot reclaim any Duty paid so all will see a net increase in their fuel costs which will obviously have to be passed on to all consumers !!
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swencbb, me too!
The BBC is briefed BEFORE parliament?
That is horrific!
The Ministry of Truth indeed!
Those of you castigating the Tories and attempting political spin and point scoring for the labour party would do well to read the comments by the OECD of the last few months , where the UK was sited on many occasions as being in the WORST position to weather the storm.
If your french is good enough , have a look at what the french newspapers are saying ,then move to the states and read the likes of the Herald tribune and Washington Post.They give one a greater insight as to what the rest of the world actually thinks of us.
Were I a Tory , I would keep my cards VERY close to my chest for fear of the theft of ideas.
The change in VAT in the first place gives all retailers and businesses a huge headache, it was a stupid idea, given that retailers are already cutting prices by huge percentages and STILL not tempting a suspicious public through the doors.
To suggest that the tax will be raised in future obviously having discussed it as a possibility, fills me with even greater dread for the future.
As for Lord Foy , trying to force the banks to lend , well good luck pal , your lot gave independence to the BoE , now try telling them what to do!
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What amazes me is that most people in this country don't even realize that VAT is an EU tax to keep those in the EU on their gravy train.
Why Oh why are people so ill informed and is that the fault of the BBC who go to great lengths to make sure that VAT and the EU never go together.
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The real political story this morning is the IFS assessment of the PBR and in particular its 'central estimate' that the new higher rate tax band will raise NO additional revenue! Since the Government expected to raise some 1.6bn by this measure, how will they plug the gap? Cut public spending? Unlikely. Raise VAT? There's an idea.....
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This fits in with what both I and the BBC's Business Editor, Robert Peston were told in the few days before the PBR.
To Quote from the Holy Grail.
"you're not fooling anyone"
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A) if a 2.5% cut in VAT will make no difference (as was repeatedely screamed yesterday) then how is a 1% rise going to matter?
B) For this rise to be implemented Labour have to win the next election..... is WebCameron scared he might lose? After all if he wins this will never happen so its a none-story.
C) if Osbourne is so damn clever perhaps he'd like to tell us what he'd do to save the economy? So far all he's done is further damaged confidence in sterling, made snide comments at Labour and procrastinated.
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#119
That's not my experience.
I am party to government documents for IT systems, usually prefaced by a personal message by the minister in charge. So if you understand how governments work, you will understand which documents these are.
They are key strategic statements of intent.
On the whole, they are ambiguous, contradictory and lack clear detail.
In other words, they are appalling as a vision statement for an IT system. A document which is the bedrock for the business case for any IT system.
What happens then is a tender is designed and a contract awarded.
Then, the firm involved has to obtain clarity and agree with government (through the civil service) the unambiguous statements that they can use to create the solution.
This process is such a mess, government now contract out this activity out to the private sector because no-one in government or the civil service can agree what they want.
I can't cite many examples but I have heard or read the very same minister (who prefaced the document) stand up in Parliament and not only contradict their original prospectus but actually announce key changes (the delivery date is a common one) without any consultation with the contractor.
For reasons of political expediency, nothing else.
Want to really know why the NHS IT project is such a mess?
Changed government priorities, countless re-organisations, failure to properly reform key processes and a lack of clear, cogent or firm requirements.
This is a complete contrast to any of the work the clinician specialists have done to contribute - their work has been exemplary.
So pull the other one.
This 'pub commentator' knows only too well how this government 'works'.
It's not pretty, it's expensive, it's a mess and it's appalling value for money. The level of waste is shocking.
If you work in government, you will be aware of the civil service kick-off meetings for big government projects.
Please tell everyone who isn't so aware; what is one of the most common agenda items when discussing the apportionment of budget?
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Personally I think Gord & Ali are pretty incompetent...not however dishonest. I think this was a genuine error.
Love all the people trying to hold Nick to account for knowing thsi pre-PBR
"This needs further investigation!" they all shout.
Lets drop the conspiracy theories shall we. The Gov are drowning anyway.
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Shouldn't any government look at all the options before deciding? Sounds prudent to me.
Nick, there's a point we're all overlooking here. In 1997, the Tories left us taxpayers paying out 5.3% of GDP on debt servicing. The prospect is that next year our pay-out will be only about half that in 1997.
How come the Tories claim our debts are going to be crippling when the cost will be half of what they bequeathed to us 11 years ago?
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I wouldn't say so.They're bereft of sound leadership and are still unreformed. They have nothing to lose by coming clean and spending more time in opposition. Mark it down as the brand rebuilding they need to focus on more than their current wheeze of hawking themselves around like a pair of used panties on Ebay.
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Nick, a favour please.... could you have a word with the editors at the BBC News and ask them to stop CONTINUALLY using big graphics using the words CRISIS and DOWNTURN?
Confidence is key to our future successes and this continual reminder of our economic postion night after night day after day is beginning to really irritate me.
p.s. That apart, I do have every confidence in you having your fingers firmly on the pulse of our great leader.............what a great team you make.
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@48
No they wont come down food is already zero rated.
Maybe this explains your position
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The only points of question are (i) whether Robinson and Peston were briefed before Parliament on the alternatives within the PBR; and (ii) who is accountable for having failed to proof read the document, thus failing to spot the glaring error.
That said, I'm sure that Campelson would love nothing better than an inquiry into both points - preferably in the full glare of the media spotlight - to divert attention from the real issues surrounding this Government.
I think that the Tories should focus their efforts elsewhere.
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There is a poll on the Guardian web-site at the moment.
Currently stats are as follows:
Yes - Darlings done it - 29.3%
No - we'll all pay later - 70.7%
I expect the VAT 'mistake' will not improve Labour's ratings on this poll
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The claim the the fuel duty is neutral is a bare faced LIE
It affects companies Vat claim from day 1 and in 13 months time when the VAT subsidy stops it will affect everyone else because the duty hike will remain in force and you will be paying more because VAT is assessed after the duty is added
Nulabour Daily Lies
Gross incompetance
Call an Election now!
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when someone says "to be honest", it suggests they had not been in the past; it also suggests that what they are about to say is also a lie.
Ask any shrink, lawyer or police officer how many times they've heard that line and what it means.
Anyone care to start an official vote of 'no confidence' in "Nothing New Labour" please?
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re: 62, CEH
All those fat-cat Tory pensioners would have to leave their villas in Tuscany,
Who knew Toynbee was a closet Tory? But that's the Nu-Lab attitude... do as I say, not as I do.
You ought to be ashamed of yourself, supporting the criminal scumbags who call themselves Nu-Labour. You're as bad as they are.
Where's your third eye Charlie?
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It is becoming obvious that yet another government sleight of hand trick is beginning to unravel.
Knocking 2 1/2 % off VAT, but substituting that with a rise in fuel duty so that it is cost neutral to the government, gets a headline supposedly at no cost.
Presumably at the garages there are going to be some administrative changes required since they have two columns to update in their returns, one up one down, with no inherent benefit.
As has been widely mentioned, this is actually unhelpful to bsuiness, since they actually get no benefit at all, which was the supposed purpose of the giveaway.
And then, in one years time, when VAT is increased again, will the fuel duty be dropped in line with it?
This has all the makings of somebody being too clever by half, just as with the 10p tax band, and will become a complete mess, just like everything else this lot touch.
If they told the truth, were sufficiently contrite, got rid of the problem (the bloke with big ears), and came up with some properly thought out plans then they might, just might, gain some respect, and eventually regain some popularity.
I think I'll put that on my xmas wish list, along with a hydrogen powered ferrari, champagne that doesn't make you drunk, choclate that won't pile the pounds on, and a bonus of actually getting a job.
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The way I see it is most of the "Labour apologists" have a fairly constructive attitude but the Tory shills bite anyone's hand that doesn't agree verbatim with whatever dictat of the week is coming out of Tory Central Office.
Labour have made mistakes (not the first time I've said that) and the Tories are making mistakes (not the first time I've said that). I tend to think Labour are best placed to govern and the Tories could do with more time in opposition. I wouldn't call that dogmatic.
It pretty much looks like senior Tories and their own media are agreed that the Tories don't have a surfboard. Some of you guys are fast off the blocks to quote Tory HQ when it suits you but quiet as a church mouse when it's bad news.
Just because Osborne and Cameron like to duck policy and insert "incompetent", "liar", and "dithering" into every statement and press release so seat-filler media parrots it doesn't mean it's true. It's just hijacking the media with marketing tricks to manipulate people's emotions. That's not reality, it's propoganda.
You're being played but by whom?
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Moderation queue is getting bigger. Wonder why?
Are the majority of the postings unhelful to the bosses?
Is it becoming uncomfortable for them?
We've got PMQs and the emergency debate coming up, and presumably these might be tricky for the government.
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139. "What amazes me is that most people in this country don't even realize that VAT is an EU tax to keep those in the EU on their gravy train."
No. It WAS an EU tax (or rather EEC tax) when it was first introduced. Now, as with NI which was meant to pay your pension and NHS bill its just been absorbed into the general tax pool. The EU get far less than the total revenue from VAT, and although Britain pays more into Europe than we recieve, we do recieve quite a lot which would further muddle the sums.
What IS without question is that we do not pay 17.5% tax direct to Europe.
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Robinson & Peston have to toe the labour line or they will miss out on their special briefings?
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What worries me is that they obviously know we've rumbled them and they don't seem to care. They feel they're on a roll right now and they think we're all stupid enough to believe every little porky they tell us. Believe me, these new Labour chumps are after our money. So nice of them to get a loan out for us, love the idea that the government is decided to effectively say 'what the hell, lets just go for it'. Let's have that election Gordon. Let us have a say on how you spend our money.
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The PBR is unravelling before our eyes:
1. Wildly optimistic growth forecasts.
2. The 45% tax band exposed as a purely political measure with no revenue raising impact.
3. The efficacy of the VAT cut widely questioned. Retailers are already e-mailing me to say 'don't wait for Dec 1, we will cut prices now' (so VAT cut seems likely to be lost in a deflationary spiral). Administrative costs now and at end of 2009 completely ignored. A substantial amount of lower to middle income expenditure not affected - mortgage, loans, petrol (offset by duty rise), food.
4. Additional cost to transport and haulage companies - VAT is reclaimable but duty is not.
5. Tax increases will impact on lower/middle income earners. The Government are dancing on pin trying to justify the position that tax rises will not affect incomes below £40,000. The Tory position of closer to £20,000 seems to be more widely accepted, based on the current tax position.
This really is a dog's breakfast of a PBR which makes the 10p tax fiasco seem like a slight error in judgement. I would put money on substantial changes or U-turns in the March 09 budget. Darling has form after all.
I was not in favour of fiscal stimuli, as I believe we cannot afford them and in the long run an aggressive monetary policy (although more painful) would be more effective and affordable. However, given that the Government had decided to take this route they could at least have shown some imagination, competence and continuity. I am afraid Brown and Darling are exposed as both political opportunists and financial illiterates.
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It does seem rather contrary to Brown's assurances upon usurping Bliar that there would be an end to the marginalisation of Parliament, if Messrs Robinson and Peston were being told what was going into the emergency budget before it was announced, albeit not particularly surprising.
As regards the increase to 18.5%, so what. Frankly, if the VAT reduction was going to have any impact, it should have been a bigger decrease followed by a bigger increase. Cut now by 5% before increasing by 10% and you have a very good reason to go out an spend.
If this, or any other government is going to make any inroads into the country's massive debts, we need to be making major increases in tax and significant reductions in spending. If a 2.5% reduction costs GBP12.5bn, then a 1% increase will raise only a further GBP5bn. Hardly going to make a dent in the additional interest costs, let alone the debt.
PS By the way, Charles, you're being particularly entertaining today. Have you taken your medication?
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Being unemployed I have been spending some of my spare time reading the IMF World Outlook report October 2008.
Since most of us (apart from the most blinkered Labour bloggers) do not believe any of this Government's financial projections consideration should be given to establishing an independent non-partisan agency to monitor current and future fiscal projections.
This was proposed by the Conservative Party, and is discussed on page 187 of the above IMF report.
As the IMF say, this would minimise partisan judgement in the evaluation of economic information.
It would help to reduce the role of Alistair Campbell in economic decision making.
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#45 I353
So, the cut from 17.5% to 15% isn't minor - it's a 14% cut then!
Or is it only minor in a downward direction, as otherwise how could you criticise it?
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I see the BBC are going with VAT 'it's a mistake' angle, thus given Gordon the benefit of the doubt. Yep because Brown is not known for his deceitful, slight of hand when it comes to budgets is he?
Lets see:
Gordon introduces a tax cut in a budget that is really more to do with laying a trap for the Tories than helping out the British people.
At first it seems Gordon 'the genius' has done it again and Labour MPs cheer
then it all starts to unravel, as we find out that elsewhere in the budget hidden away it will mean we will be hit in our pockets for more.
We didn't see it at first because Brown was being clever / deceitful
Now doesn't this all sound familiar, something remarkably similar to the 10p tax row.
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#108 flamepatricia
The rise in Daily Mail readership would explain a lot of the hysterical, shreiking comment on here.
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Oh dear, oh dear, oh dear.
After today's revelation, Labour couldn't do honest if they tried.
Gordon said:
So he either dithered (true to form), bottled (true to form) or it's part of their post-2010 tax plan (true to form).
It seems the New Labour troika of Social Justice, Wealth Creation and better public services is finished.
1. Social Justice - not very just putting 2m on the dole and completing one old adage about Labour.
"Unemployment is higher when they leave office than when they take office."
2. Wealth Creation - the highest government borrowing ever, house prices in freefall, repossessions up, the most indebited population in the world.
A complete sucesses.
3. Better public services - well, some improvement, granted. Difficult not to when you've doubled government spending in 11 years.
But at what cost?
A million more administrators. Doctors, nurses and policeman mired in paperwork.
Just a shame, the government can't keep our personal information safe.
Face it, New Labour is dead, finished, deceased, shuffled this mortal coil. They are no more, they have passed away, they have slipped this mortal coil. They are strumming harps, kicked the bucket, they swim with the fishes.
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123
I am not being mad or cynically political,but realistic
What you are asking for is an asset base, thats declining in value, which already has GBP 1.5trillion of debt attached to it,to be a vehicle for increased borrowing,and that borrowing to paid by a population that has already committed itself to 160% of its income to pay existing borrowing.
Had the government encouraged people to save when the economy was growing strongly we could deal with this.
Had the government not taxed away our pensions we would of had a massive store of saving that could of been mobilised to help restore equilibrium in the money markets.
Had the government constrained spending we wouldn't be going into a recessionwith 500billion of debt
Had the government trained up the unemployed to fill the gaps in the job market,instead of importing a million workers,we wouldn't of lost their wages abroad,and reduced our benefit bill,which stands at GBP160billion going into a recession
The government has spent a decade acting like a five year old in a sweetie shop with an unlimited credit card, then wondering at the age of 15 why it is bankrupt,with no teeth and in hospital weighing 40stone at deaths door hoping some one will come along with a magic pill to make it go away.
Making us fit is going to be long painful,first to remove the fat,then rebuilding the muscle
GB and AD are offering the magic pill
DC and GO the diet and gym
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#143
Only too true, I'm afraid.
Actually it's worse than that. Governments are almost entirely short-termist and focused on political advantage not efficiency in their thinking. Labour are worse than the Tories in this regard, but not by much.
The result is that crazy things are done for short term political gain, or Civil Sevants jump through hoops to try to find justification for political decisions. As I have said more than once on these blogs, it's policy-based evidence not evidence-based policy.
Governments change their mind and set new targets almost at whim, and regardless of the costs and delays that ensue.
But delivery organisations can almost never get the targets changed, even if they turn out to be the wrong ones or circumstances change. You then get locked into doing wrong things to meet the inappropriate targets.
When I worked in two quangos and two research institutions we spent an inordinate amount of our time making sure we met pointless and unjustified "service delivery tagets" and other such bureaucratic hoops.
If the delivery target was that we should publish research X months after the end of the project, that's what we did even if it wasn't ready and waiting a month would make it more reliable. No flexibility for circumstances.
If we ever dared to tell senior civil servants or junior ministers that what they were asking us to do was pointless or counter-productive we were put down very firmly: If it's in the delivery plan, that's what we want regardless of whether it's the right thing to do.
An example: one body was given a maximum head count of 100 because a management consultant said this was how many people we needed.
The government then gave us extra tasks but would not let us employ more staff as this would breach the headcount target.
So we employed contractors at more than twice the total cost of employing our own staff. As it came from a different budget line the civil servants were happy as they could then tell ministers we were keeping to the headcount target. I could go on...
Governments are not interest in good administration. They are interested in scoring points over the opposition and getting relected, not necessariliy in that order.
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Gordon Brown has told us that he his leading the planets approach to resolving the financial crisis and that all countries are following his plans.
Given his global economic standing around the world will the PM grace us with his presence at today's emergency budget debate in the country that he actually runs?
I suspect, however,that Gordon will be absent. He doesn't like to be associated bad news.
I imagine that after two months of fresh air, Gordon is back in the bunker again. He won't want his name tarnished with:
1. PBR being unpopular with the public
2. VAT issue
3. Blackhole in PBR finances
4. Experts and public alike saying that they don't think the fiscal stimulus will work
5. That Conservatives did not fall into the political trap he laid.
6. That the government have been forced into an emergency debate that they did not want
For the sake of the country - I hope Brown does attend the debate. In times of trouble we need a leader who leads from the front.
Bunker-like-cowardice will send signs that Gordon does not have confidence in the PBR.
If Brown doesn't have confidence in the PBR, then why should the public? Consumer confidence is necessary for economic recovery.
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Charles, I dip in and out here as I work. How on earth can you post so much? Well as you are a Labour apologist I think I know the answer. I don't actually read your post because they are not really arguments I find interesting but my lord you are always on here! I can only assume more people use your login (Labour HQ or something).
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162 JohnHarris66
Now there is some common sense. I agree with that totally.
Good luck with finding a new job.
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Ref political briefings etc:
We should do our own digging for the facts - the press are too reliant on being fed the most tender joints, or have to fight against their own beliefs taking precedence every time they report - not always possible.
A well known Conservative MP is walking through the zoo when he sees a little girl leaning into the lion's cage. Suddenly, the lion grabs her by the cuff of her jacket and tries to pull her inside to devour her right in front of the little girl's screaming parents.
The MP runs to the cage, hits the lion square on the nose with a powerful punch. Whimpering from the pain, the lion jumps back letting go of the girl, and the MP returns her to her terrified parents.
A Gruniad reporter has seen the whole scene and says to the rescuer. "Sir, this was the most gallant and brave thing I saw a man do in my whole life," he says.
"Why, it was nothing," the MP says. "Really, the lion was behind bars and I knew God would protect me just as He did Daniel in the lion's den long, long ago. I just saw this little kid in danger, and acted as I felt was right."
"Well, I'll make sure this act won't go unnoticed. I'm with the Guardian and tomorrow's paper will have this on the front page," he says before leaving.
The following morning the MP buys a copy of the Gruniad to see if it indeed brings news of his actions, and the headline reads:
"Right Wing Christian Fundamentalist Assaults African Immigrant and Steals His Lunch."
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Sensitive data being lost is such a common occurence that it no longer remains headline news for more than a few hours. Now we have a "black hole". Wonderful, now we know where all the missing data went!
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Nicky, Nicky, Nicky. So now you and matey Preso are above Parliament I was always of the opinion that it was Parliament who were informed before the great unwashed?
I think I may have found one of Grab-dons advisors it's Preso the guesso isn't it.
I can understand why Grab-don was lughing during the PBS when he's got Pinky and Perky doin' a Kylie and Spinning Around.
I was watching the faces of the Labour front benches during the PBS and the lot of them had faces like wet kippers. They know "The Parties over it's Time to call it a day" (sorry had to get that one in). The bell doth toll and heads are going to roll, come the election like a Bat out of Hell most of them will be gone when the morning comes (I wish).
History bit 1979 Labour left the economy in one heck of a mess LSE prdicted 30 years to get back on track Tories acheived this in 18 years left office 1997 healthy growing economy Grab-don so impressed he kept to Tory spending no repeal of Labour laws.
Time waits for no man 2009 Labour destroy the economy leave Britain with the largest debt in our History the honest hard workers pensions have been destroyed the chave now have careeers on the rock and role the public sector is onvermans by 75% those who have had their pensions destroyed are now paying not only for their own pittance of pensions but the GOLDEN FINAL SALARY (what's one of them?)PENSIONS OF THE Public non working services industry.
When this crew are finaly flung from office their needs to be some major inquires made and I know it is not do for one government to investigate another but I really do think this one needs to be investigates in depth and if that mean fromer Cabinet Ministers and Prime Ministers go to jail then so be it and Campbell can follow on too.
No wonder they don't want to do anything about Mugabe as he makes them look lilly white.
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#badgercourage
After reading your post, I've come to the conclusion that we should sack all the MP's, politicians, and hangers-on, and start again by getting people in who really want to do the job. Surely there must be some decent people left out there with morals and scruples who want to do the job to the best of their ability..........?
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#86
first thanks pointing out that indeed I was a touch lazy with my english and should have written.
The missed deletion in one version of the PBR published.
Thanks also for reinforcing the central points of the following pieces of the post, if you read it.
One central point being if you believe Labour are inept then an explanation that they were inept is consistent. It is not always a conspiracy or deliberate obfuscation. The whole document is riddled with inconsistencies due to the last minute changes being made up to Monday.
If as you allude I were a Nu Labour spin doctor then proposing Ken Clarke (A Tory) should be brought out to toast Darling (Nu Labour) (who as you seem unable to appreciate subtext - I also believe to be inept and unfit for his post).
Just because a Tory/Labour/Libdem/etc. said it does not mean it is right and neither does it automatically mean it is wrong.
All party politicians have the ability to mix right and wrong within their statements. e.g. I happen to believe Ken Clarke was a good chancellor but that Nigel Lawson was as big a muppet as Darling. Does this imply I am a natural Labour supporter or am I a conservative - the aswer is neither - I look at the situation of the time and select on the basis of which set of arguements seem most likely to me to achieve the best outcome for the country and me(I think I am the rare breed that does not only vote my pcoket book, but then I may be wrong...).
Blind support of everything one party says or does irrespective is just not sensible (it provides for much amusement reading posts but actually is pointless)- this is why in the UK most governments end up doing the wrong things because they start off doing something right that is appropriate for the time. They then try to apply more of the same solution to a new set of conditions because they believe it to be right where in fact it is now inappropriate. e.g. increase wealth by getting the city motoring - great idea but if you apply more and more incentive then eventually the economy goes pop. Lack of balance (in all things) is always the cause of problems (and not that does not mean doing nothing - just the first thought on any politicians mind should be first do no harm..).
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#166 flanflinger
"A million more administrators"
Another Tory myth - where does that figure come from?
Certainly not from Public Sector Employment statistics.
Possibly this is symptomatic of flamepatricia's point above about the rise in readership of the Daily Mail leading to ill-informed beliefs that many people in the UK now hold (or very successful Conservative spin)
In 1999, there were a total of 4.167 million people employed by the public sector. This increased by 480,000 people to 4.647 million by Q2 2008
Employment in the Civil Service (the key 'waste of money administrators' or 'managers' as their known in the private sector) increased by 7,000 - from 481,000 in 1999 to 488,000 in Q2 2008.
It's difficult to find stats for the increase in the numbers of public sector workers by job role without going to individual statistical series about each part of the public sector workforce (e.g. how many more teachers, nurses, doctors; how many more pen-pushing bureaucrats and managers).
But even if there was no change in 'worthwhile' roles (i.e. no new doctors, no new nurses, no new teachers, no new teaching assistants, no new police officers - which we know is patently untrue), this halves your estimate already.
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Nick,
Surely the fact it was published in a signed document shows more than just "innocent mistake" ?
Come on man, stop listening to spin and be a journalist. Actually get off your chair and investigate. It's us who pay your salary not Gordon Brown.
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#168.
Nice to know it's not just me and my dealings.
I was consulting as a private contractor for a transportation specialist and I got sent to a meeting some years ago.
The new runway at Heathrow required software modelling for flows of people, cars, buses, trains to work out concourse sizes, public areas, potential pinch points, etc, etc...
The civil servant had forwarded the original plan, this just had a black T section sticking out of runway 27R. That was it. This was the thoroughly researched government white paper on air transport. Thousands of copies printed, etc, etc, etc... Discussed in parliament, the press, etc, etc, etc....
So I asked "Where's the new terminal?"
I got a reply in-between 27R and 27L.
Terminal 5.
The civil servant thought I was pretty stupid not to have heard of it.
I replied back "So, you are going to have a very large plane destined for the new runway crossing 27R at 5mph? 27R has a plane landing or taking off from it every 90 seconds? So how's that going to work?"
You see, there had been official denials about Terminal 6 and also the land required (currently covered in homes, businesses, schools and a major motorway) was not part of the compulsory purchase order so not in the budget. I imagine moving a motorway is pretty expensive.
The civil servant's face was completely blank.
It was a complete waste of time, the information we provided was useless. As part of an existing contract at the time, we did the work and got paid.
And then the next plan for Heathrow had something new on it - guess what?
The location of Terminal 6.
And all the modelling work had to be done again.
Wasn't cheap - about £2m I think.
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Cobber950 #167: The global economy is not Mrs Thatcher's corner shop in Grantham (I guess Conservatives never learn anything, do they?)
Your metaphor is spectacularly wrong. The Aristocratic Adolescents are offering a patient that is losing blood and suffering fainting fits no help and indeed (you said it!) a succession of trips to the gym.
Congratulations! You win admittance to the Calvin Coolidge Memorial Fellowship for creating massive global meltdowns. No other government in the world is following these policies. The Tory Opposition stands proudly isolated in pretending that we are not facing global meltdown, and need do nothing about it.
If Obama were to follow precisely your advice (the US has horrific levels of debt too) the global economy would for certain go down the plughole. Fortunately he won't, because he is not a fool.
The FT editorial headline on Monday was: "A gamble - but we have no choice". And that is the reality. We can certainly argue about HOW to massively stimulate the economy (VAT, income tax reductions, interest rate cuts, public works etc. etc.). But there is no debate amongst intelligent people about WHETHER to stimulate the economy. That's a topic solely for economically illiterate Daily Mail readers.
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For all those who can't understand the point being made about VAT
Reducing the rate of VAT,isn't going to make difference in terms of people buying more,because it will be lost in the heavy discounting already happening,thus depriving the government of 12 billion of revenue for no purpose,as well as incurring borrowing costs when it is added to our borrowing requirement
When it is returned to its current level people will notice the price rise,buts its benefit to the exchequer will be lessened by the debt interest it will have to pay on the money it borrowed to cover it in the first place, as well as theburden of non recoverable costs imposed on business as they have constantly change their entire price structure
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Those who think this is a little local affair caused by Labour socialism, might like to note that China has just announced "the biggest rate cut in decades" (FT headline), and is preparing a fiscal stimulus package which might even be greater than the monster being prepared by Obama.
This really is big stakes guys. It's global, and it is unprecedented in any of our lifetimes. The relentless local trivialisation of what we are facing, as if we were an island disconnected from the rest of the global economy, is thoroughly depressing. The VAT issue is a totally insignificant irrelevance (like worrying about a patient's lipstick when her heart is not beating).
Those who really think this is a matter of local Labour socialism really do have to explain why the economies of the US and China are both also currently in freefall. Everry economy is in pretty desperate trouble, even if we are doing worse than most.
Thoughts? It's all Gordon's fault?
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#177...
Tory myth... if you say so...
How this for another myth.....
So Brown is going to cut government spending growth from 2.7% to 1.2% after 2011.
Is there in the PBR.
So how many schools and hospitals are Labour going to close?
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#183: you are right. No-one knows what the state of the economy is going to be in 2011. Just think what happened in the last three months!
It is almost certain - under any government - that taxes in the UK will have to go up and spending will have to be cut. The US will face even more appalling choices at some point in the future around taxes and spending. It will almost certainly have to cut defence spending, cut Medicare and Medicaid, raise gasoline taxes, and raise income taxes. There will be no easy options.
None of this is a reason to sit on our hands now and risk the situation becoming even worse than it might be. Note again from today's FT: the German Government is coming under criticism from all quarters for not providing sufficient fiscal stimulus to its economy. (Perhaps I was wrong. There is another stupid Conservative government out there.)
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#183 flanflinger
I'm happy to be corrected on your "1 million more administrators" point.
I've provided stats that show even if there were no more doctors, nurses, teachers, police etc, the number of administrators could only have risen by half a million tops.
So not "if I say so". If the evidence says so. You find something that isn't factless Mail shrieking that supports your view.
Where's your evidence? Shhhhhh..........
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To balhamu,
While your figures may be correct for admitted public sector jobs, there have been many thousands of jobs created in what you may call the private sector, but whose sole customer is the Government.
"Many of these jobs are entirely funded by the public purse but, because workers are formally emp-loyed by a private company, the official figures record the growth in these areas as having been created by the private rather than the public sector".
This is from a study from the FT, it isn't "factless screaming from the Daily Mail" I suggest you read the rest of the article, you can find it here:
http://www.ft.com/cms/s/0/6d1f79de-b9c8-11dd-99dc-0000779fd18c.html
Evidence enough?
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#186 amifree
You are quite right a lot of things have been contracted out into the private sector (I'm not sure that started in 1997 though - I think there's a longer history of this).
But they're unlikely to be administrative pen-pushing roles are they? And if they were, it surely must be the case (as it's the private sector) that these tasks are now done far more efficiently, so reducing total number of administrators?
Feel free to come back when you can justify flanflingers "1 million more administrators" comment, or even when you reach a number a quarter of the size.
An administrator will be someone who is entirely office-based, has no front-line duties and deals entirely with forms, management, strategy and measurement.
Doctors, nurses, teachers, policeman, security guards, cleaners (e.g. private sector cleaning contractors), fireman, ambulance drivers etc do not qualify as administrators do they?
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Nick,
If you accept labour's spin about this, then can you explain the presence of the black-hole ? (ie where's the missing debt/tax-rises gone that are missing from the books now that the books simply don't add up)?
If labour are telling the truth, then why don't their books addup? Where's that money gone?
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balhamu @187:
'An administrator will be someone who is entirely office-based, has no front-line duties and deals entirely with forms, management, strategy and measurement.'
Doctors, nurses, teachers, policeman, security guards, cleaners (e.g. private sector cleaning contractors), fireman, ambulance drivers etc do not qualify as administrators do they?
One of the reasons I left teaching was the fact that this was becoming more and more the norm mostly during supposed recovery time during evenings and week ends but also at the chalk face! I'm sure the same is true of some of these other professions.
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Cameron debt lies exploded
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#189 sicilian
It's a shame you were lost to teaching - and I sympathise that you felt the admin work was too much.
It's difficult to drive performance improvements from the centre, especially when teaching unions are adept at resisting any performance-related pay. Markets alone do not work as they will never give incentives for schools and teachers to focus in the right ways (it's difficult to establish a school's true quality as a parent; measured performance information is too easy too fiddle by focussing on the borderline students at the expense of high and low achievers). Which is why there has to be a role for administration things in school improvement (and for e.g. child protection reasons to avoid abuse going undetected). The balance has probably shifted too far towards central directive though, and is something that needs to be resolved (e.g. stronger local accountability)
But you're not suggesting that additional teachers should qualify in statistics as admin staff are you?
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Why o why does Brown always have to refer to history to justify what he does. I see today he has raised the issue of tory vat rises in the past. Doesn't he know we're at least 11 year on from the last tory government so what relevance is it? Has he no credible events to support what he does!
I see Darling is already discovering they have to back track on whisky,is this the start of other changes. This pair couldn't run a chip shop.
You'd better lock your wallets everyone because in a couple of years this budget is going to hurt. Don't kid youreslves it won't affect you or trust theyre telling the truth...cos they aint.
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novo@123
"It is the absolute height of irresponsibility on the verge of the worst recession for eight years (and perhaps worse) to be proposing that we start repaying debt."
That's not how I interpreted cobber@117, but then I'd also expect individuals to try and repay their debt.
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balhamu@190
Is that really all you can offer?
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I'm quite shocked that journalists, apparently working for an impartial organisation, could receive information from the government and fail to pass on the details to the public.
I'm also shocked by the viciousness of this so-called "pre-budget report", a term carefully chosen in an attempt to block parliamentary discussion. It does little for most people in work, will not reduce prices because transport costs have effectively been raised - and they will be passed onto the consumer no matter what the treasury claims.
To increase taxation for higher earners (I'm not one) at a time when this country needs all the expertise it can get, is short-sighted. It will result in both businesses and professionals going elsewhere where their skills are valued and not seen as a milch cow to fund a benefits culture
To use national insurance as a means of generating income that will not be used for healthcare is despicable. It will ultimately effect every single earner, to say otherwise is disingenuous.
I'm disappointed with this government's record.
We are not high earners, we are an ordinary working family - married for many years. All the much publicised claims that policies will benefit us ("hard working families") have amounted to absolutely nothing. In fact the longer it goes on the worse off we're becoming.
Our children have got older - and therefore no longer even eligible for child benefit - and are attending university. The fees are awful, the loan system iniquitous and inadequate leaving us to pick up the bills for accommodation and for spending money, mostly on books and reference material.
I'm disgusted that any system that ensures that those leaving higher education start working life with huge debts, more especially because the fee system in England was voted in by Scottish MPs who knew they would not lose votes because their own constituents children were safe. I don't understand how the EU allowed it, in terms of legislation, it's almost an academic apartheid.
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genius@192
"Why o why does Brown always have to refer to history to justify what he does."
Because he gained a degree in History and then widened his horizons to "a doctorate on the Labour Party and Politics in Scotland". See The Early Years of Gordon Brown website:
http://www.gordonbrown.co.uk/bio001years51to74.htm
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balhamu@191
"But you're not suggesting that additional teachers should qualify in statistics as admin staff are you?"
I think the govt would be happy with that.
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#98 and #103 CEH are you one of Browns generously rewarded public sector workers?
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Interesting analysis. Several previous Chancellors wished to leave options open until the last minute. Insofar as many people are claiming that the 2.5% reduction in the rate of VAT won't make much difference to their spending patterns, returning it to its original level or raising it by another 1% (presumably when the economic climate is better) will have broadly the same effect. The politicsof all this is fascinating. If the Government had adopted the Conservatives' prudent approach, what would the Conservatives now be criticising a "do nothing" Government which failed to help its people and businesses? For the Government, the politics & economics go nicely hand in hand. If it works, they win the next election. If it doesn't, the Conservatives inherit a disaster area.
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#194 pammyammy
Clearly not (see other posts). Just thought it was interesting that one of the Government's political opponents - an economist and former bond-trader - thinks Cameron is talking baloney.
#197 pammyammy
So I'm wrong then. Teachers are actually admin staff and sit around in offices all day pushing paperclips around and take no lessons or any front-line work like that.
Ok
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This comment was removed because the moderators found it broke the House Rules.
balhamu @200..
"Just thought it was interesting that one of the Government's political opponents - an economist and former bond-trader - thinks Cameron is talking baloney"
Reading that article I would think that the author may well be regretting what he wrote.
In actual monetary terms,the US and Japan certainly have higher debts..something I see Mr Brown has taken to saying.However,as a proportion of GDP,it is also true that the UK has record levels of National debt. The same can be said of personal debt.
Given the Governments sudden frenzy of panic in the PBR,it would appear that they now also think we have a problem.
Does that not suggest that perhaps the article you quote was slightly short on economic foresight..even for an Economist?
Maybe not ,you may argue...but the author was also "a former Bond trader" who,after all,are implicit in this Economic mess we now find ourselves in...No?
I'm not having a pop at you personally..just think that the article,having been written only a month ago,was not very well thought out,given where we are now.
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balhamu@200
re 194 - but he's implying the cupboard isn't bare only a month before it's proved that it is indeed bare, so not a lot of faith in his credentials from me. Maybe Vince didn't read the proof copy.
re 197 - sitting in offices, pushing around paperclips is YOUR definition of admin.
How about "The word "administration" is derived from the Middle English word administracioun, which is in turn derived from the French administration, itself derived from the Latin administratio -- a compounding of ad ("to") and ministratio ("give service"). "
The point of the discussion before you twisted it was that teachers have to fill in far too many forms these days rather than actually teach.
When nursery teachers have to produce daily lesson plans and learning objectives for every single one of the 3 year olds in their class, and "observe" them and write down their observations for every child, every day, there's not a lot of time left for anything else. And the whole point of my objection to this is that children of that age should be playing and socialising, not learning formally. In many other countries, children start formal education a year or two later, when they are more developmentally ready to start formal lessons.
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202:
There are as many opinions as there are experts and I agree it's the latter who have led us all into our current feeble economic position. I wouldn't trust them or their views as far as I could throw them!
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#182Thoughts? It's all Gordon's fault?
After 11years of economic growth why are public finanaces in such a mess?-YES IT IS ALL GORDONS FAULT.
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#203 pammyammy
The cupboard is not bare, politically the Government have decided it will be bare once automatic stabilisers and the modest 20bn stimulus has kicked in. It's an important distinction.
Glad we cleared up that teachers aren't front-line workers and useless pen-pushing civil servants. Sack the lot then.
#204 sicilian
I understand the logic of your view until I follow it's conclusions.
Experts - we cannot trust them, they got us into this mess
What we need are amateurs who know nothing about the situation and have no expertise.
A time for Dave and Gideon I guess
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balhamu@206
"Glad we cleared up that teachers aren't front-line workers and useless pen-pushing civil servants. Sack the lot then."
What are you on - gin, glue, magic mushrooms?
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190 Balhamu
Great Link Balham, regardless of your Politics even the Right wingers should feel shamefaced about what Cameron/Osbourne are doing here.
Would love a response from the Caped Crusader, presumeably the inteligent explanation would be that Huhne is a "Labour Spin Thug"
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balhamu@206
"Glad we cleared up that teachers aren't front-line workers and useless pen-pushing civil servants. Sack the lot then."
What are you on about??
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That was the point made.
"The Government have employed 1 million additional pen-pushing administrators" was the proposition.
I showed public sector employment has increased by *only* 500,000 (well - that is a lot - but half of 1 million). Many of whom have been front-line workers.
Some then claimed that the amount of bureaucratic work that teachers have to do makes them administrators.
I would disagree - but I guess the Tory argument needs as much help as it can get if anywhere near a million is going to be reached.
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210:
Ask the many thousands of teachers who left their jobs why exactly they jumped ship many after having been trained at great expense by The Government.
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#210 sicilian
Ok - when Cameron and other Conservatives talk about 'waste of space pen-pushing bureaucrats' we know they mean teachers.
Got it.
[note a posting above - I agree that the Government probably has the balance wrong between professional freedom and form-filling to meet central targets]
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This comment was removed because the moderators found it broke the House Rules.
Do you think that this was a ploy to arrest Mr Green to take everyones mind off of the budget, the VAT scandal, Rise in petrol, pensioners rise which they would have got in April , to mention just a few??????
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Reducing VAT to 15% might inject £12b or so into the economy but it does it in such a way as to be almost ineffective.
Better to scrap the 5% VAT on elec and gas? Or scrap stamp duty on houses?
However, if the govt had been considering 18.5% (or possibly 20%) then that IS a bombshell because a rise later of 3.5% or 5% the other way has a huge negative impact.
I don't understand why Cameron didn't emphasise this more.
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The Fall in VAT and rise in fuel tax cancel each other out for the man in the street, but not for any business involved in transport. There is a real rise of 2p per litre.
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