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Read his lips

Nick Robinson | 10:57 UK time, Monday, 17 May 2010

Has the chancellor just told us that there will be no tax increases beyond those he's already announced - a new bank levy and an increase in capital gains tax - or decided to live with Labour's plan for a new 50p rate, higher taxes on pensions contributions and the national insurance rise for workers?

George OsborneGeorge Osborne re-iterated his commitment today to let spending cuts take around 80% of the burden of cutting the deficit and tax rises around 20%.

He then added that by agreeing to the Lib Dem proposal to increase capital gains tax he was already on course to raise "more than 20".

So, provided the new Office for Budget Responsibility does not conclude that the hole to be filled is even bigger than feared there will be no need to raise VAT or any other tax in the emergency budget of 22 June.

If the hole is bigger, though...

Comments

Page 1 of 5

  • Comment number 1.

    Would be smart politics to leave VAT alone.

  • Comment number 2.

    Dave Cameron told us during the campaign that politicans had been taking people for fools for far too long. Now he and Boy George are the ones taking us for fools. They failed completely to say during the campaign how the budget deficit was going to be reduced. But now they're in power they are saying that the situation is far worse than they'd imagined and therefore the remedies are going to be far harsher then they'd previously said.

    It is desperately cynical - not 'new politics'.

  • Comment number 3.

    There is no hole while the government can fund the national debt and Stephanie's blog of a week or two back showed that there is no danger of the Greek disease here. All spending cuts and tax increases have counter consequences within and beyond the state balance sheet. The question is always Qui bono?

  • Comment number 4.

    Would be smart politics to levy a windfall tax on the unions - particaulalry UNITE. They continue to live in some distant dystopia where money grows on trees and the UK feels free to depose of political leaders it disagrees with.

    Newlabour has left the building...

  • Comment number 5.

    #1. At 11:07am on 17 May 2010, sagamix wrote:

    "Would be smart politics to leave VAT alone."

    Would be even smarter economics to leave politics alone!

  • Comment number 6.

    I'm not sure I agree with your logic Nick, let's see what happens.

    The emerging picture is that the situation is worse than feared, but no surprise there, eh? However, it would be foolish to rush in too soon and find the wrong issues aren't being adressed.

    The immediate steps are to reduce the gap by £6 billion, easily done with some spending cuts, but the longer term issue, about reducing the structural deficit, will take longer to implement.

    Of course the newly announced OBR will need to be involved in the longer term plans, which is something of a pity, to an old tory like me, because the committee approach might bring consensus, but seldom has enough bite.

  • Comment number 7.

    Are you writing as an economic or as a wet blanket?

  • Comment number 8.

    LOL!

    The honeymoon didn't/isn't going to last very long

  • Comment number 9.

    If the Inland Revenue stopped businesses from moving their profits off-shore into dodgy tax havens like the British Virgin Islands and if the Labour Gov't hadn't wasted so much money on the expensive private finance initiative then you wouldn't be having this discussion.

    So George Osborne would do best to leave VAT alone and do more to close those gaping holes in the UK taxation system.

  • Comment number 10.

    For the benefit of the economically illiterate (how's that for insulting?) it is worth recapping the significant numbers.

    We spend £160 billion more than we currently take in via taxes.
    Income tax alone only produces arounf £140 billion, whilst VAT produces £78 billion. Increasing those by even half would still not close the gap, and would be self defeating in many ways, pushing the economy into a downturn.

    Praying for an upturn in economic activity is pie in the sky land, whilst the world is still struggling to come to tuerms with a number of diverse factors, including the economic problems in Greece and the doubts about the future of the euro.

    So we are left with spending cuts. There really is no escape. The effort has to go into identifying areas where they can be made, and then having the political courage to implement them. I trust that we have a government that has courage, at least I am encouraged to think so by the various utterings of the politicians charged with the task.

  • Comment number 11.

    Undermining the "tory tax" line of attack is what I mean (1) - if they don't raise VAT it will be a matter of cold, calculating politics; will be Cameron and Osborne firing the first shot of the May 2015 general election campaign. Deeply cynical. The only thing more reprehensible would be if they do raise it - regressive tax that it is.

  • Comment number 12.

    #2, when Cameron a few months ago talked of an age of austerity his polls went down. The fact is the majority of the public have been brainwashed into thinking the situation was not that bad.

    Many people think the state is a bottomless pit of money, and cannot accept the reallity. We have been spending 4 pounds for every 3 of income, so we need a 25% reduction via cuts or taxes just to break even anybody with a modicum of intelligence knows there is going to be alot of pain to achieve this.

    Before we complain at ther politicians misleading us perhaps we should look at the facts, they are available, then we might stop deluding ourselves.

  • Comment number 13.

    Oh dear, Oh dear, where did the revolution go to. I saw the Press Conference and was not at all convinced. If I were the middle classes I would look forward to a bumpy ride. These cuts are peanuts and it was obvious that the Lid/Dems are stopping the Conservatives making some of the cuts Osborne would have liked. Osborne is most hesitant, I have realised, when he is being disingenuous. Are they sticking to the 80/20 rule, I got the distinct impression that they may not.

    Why should anyone listen to the Lib/Dems anyway before the election they were telling the public that 6 billion taken out of the economy this year would wreck the recovery. Now it seems they have changed their minds.

    Mmm Office for Budget Responsibility, reponsible to who, the Government or the public, I wonder. Judging by the Independent bodies set up by Governments before this, I would have my doubts about how much they will divorce themselves from Government.

    Another interesting point is that cuts in Scotland are to be delayed by at least a year. Why? What is the betting the cuts will be put off because of the Holyrood Elections in Scotland in 2011. The Lib/Dems have a big presence in Scotland could this be the reason. So look out England you are again to take the hit of the cuts not the devolved Governments.

    Was this Press Conference economics or politics, I know what I think.


  • Comment number 14.

    I do seem to remember that David Cameron said all along he had no plans to raise VAT. The media seemed to think differently and so confusion arises!!!

    As it now seems that the opposition did not know what the labour party had agreed to and were not allowed to see any of the financial books how could they possibly have told the country what they intended to do before the election. That would have been old politics. However, we now have the'shock' of the real mess of the country. Excuse me but most of us who run homes or business were telling the labour party for a long time that you cannot possibly keep borrowing money when your ability to create it is at an all time low!!!!! Others seem to have had their head in the sand!!!

    It is definitely old politics to be raising the same negative issues that have always been raised when a new government takes office. The media I notice are asking the same old questions - pleeeease get with it and take note that there is a new mood in the country. We are intelligent enough to know that this country is virtually bankrupt. We are intelligent enough to know that it is not going to be right overnight. We are intelligent enough to understand the public sector is getting bigger than the country can reasonably afford. We are also able to understand that the problems in this country are not totally the responsibility of a few investment banks. The biggest problems come from sloppy government. And I think we are all pretty well aware that you cannot expect to have life handed to you on a plate. The healthy, wealthy and emotional state of any country depends on its people to want to participate in the growth of their democracy. That means working hard, helping the needy and pulling together.

    There is definitely a change in mood and for once we should stop being cynical and get behind a government that has a lot of dreadful decisions to make.

    Maybe we should have voted Labour back in and forced them to sort out their own mess. But I do not think they would have understood the anger - let us instead call some of that government to account via the law. This could of course be a pipe dream!!!!! They have a habit of slipping under the net.

  • Comment number 15.

    Judging from the responses on here it's clear that there are those on the left who haven't got it yet. You lost the election, get over it you poor deluded fools.

  • Comment number 16.

    "provided the new Office for Budget Responsibility does not conclude that the hole to be filled is even bigger than feared there will be no need to bla bla ..."

    QUANGO.

  • Comment number 17.

    So here's the first Quango created by the new government, the Office for Budget Responsibility.

    Will the three "independent" people running it be chosen by George?

  • Comment number 18.

    The information coming out at the moment indicates the new team are serious about cost-cutting measures across the board - Labour should have been doing this last year.

    Cost-cutting and efficiency drives are the ONLY way the defecit is going to get forced down and as long as the new guys keep to their pledges that the lowest paid won't bear the brunt, then I want this alliance to succeed.

    I'm depressed at the continued cynicism from Journo's and the Public alike. It's like Labour and the rest of the world WANT them to fail just so we can say 'ooh we knew it wouldn't work'. Likewise all the 'funny funny look at Cameron/Clegg love in' jibes.

    If that happens - well done, have a cookie. The country self-implodes in the process, but bravo for having the strength to take armchair cheap digs at the team tasked with the largest debt we've had in history.

  • Comment number 19.

    This is folly - the coalition should use the goodwill and expectation of new taxes, notably VAT increase to 20%, to get the country on track faster.

    The faster the country is on track the easier to bribe the electorate with tax cuts.

    They should not be scared to make hard decisions:

    + Tax credits only on those under £40k/yr
    + Child benefit - all first children get it then it is means tested - only applies to those with 3 children or less. Big families need to take means tested benefits.
    + Increase all fixed penalty fines to £100, £200 if not paid within 28 days.
    + Make fines for Drink Driving, where there is no accident/injury related to income eg: Belgium fine is 10% of salary and 6 weeks ban.
    + Include "bad" foods in VAT scheme eg: Chocolate, Confection, Fast food chains, Crisps and fizzy drinks
    + Increase annual car tax on vehicle emitting over 200gms/km to £1000/yr
    + Increase the scope of VAT to include; private school fees, travel tickets, books/magazines, and childrens clothes

    If the coalition is serious better we take the pain earlier than delay.

  • Comment number 20.

    "15. bluenose wrote:
    Judging from the responses on here it's clear that there are those on the left who haven't got it yet. You lost the election, get over it you poor deluded fools."


    Quite. They are living in denial about the election and about the state the country's finances are in. They believe the country should just carry on spending and that raising tax on a few rich people will somehow plug the whole.

    Deluded of course.

    VAT to go to 20%. Has to be. If anyone tells me that an iPod having to go up from £105 to £107.23 will somehow leave the working man destitute, it shows how little grasp they have on reality and/or how politically biased their arguments are.

  • Comment number 21.

    11. At 11:48am on 17 May 2010, sagamix wrote:

    Undermining the "tory tax" line of attack is what I mean (1) - if they don't raise VAT it will be a matter of cold, calculating politics; will be Cameron and Osborne firing the first shot of the May 2015 general election campaign. Deeply cynical. The only thing more reprehensible would be if they do raise it - regressive tax that it is.
    --------------------------------------------------------------------------

    And theres me thinking you loved tax, Saga.... VAT is a tax on consumption, isnt it? More you consume the more you pay? How could that possibly be wrong???

  • Comment number 22.

    "16. At 11:56am on 17 May 2010, sagamix wrote:
    "provided the new Office for Budget Responsibility does not conclude that the hole to be filled is even bigger than feared there will be no need to bla bla ..."

    QUANGO."

    Remind me, are Quangos a good thing or a bad thing? Labour had thousands, so I assume you think they are good.

    And, as you know, the latest brave initiative by George Osbourne is designed to make sure that the blatant manipulation of economic figures by Labour can't ever again be used as a smokescreen to justify policy decisions.

    Isn't it great to have a man of principles as Chancellor?

    I expect this sort of upright thinking was instilled into Osbourne at school.

  • Comment number 23.

    Appbforum 2

    Typical lefty, forget about taking any responsibility for the mess that your beloved party has created and instead blame those that have to come after them and clear the mess up.

    And if you want an example of cynical politics, how about implementing a scorched earth policy on the people and country you are supposed to represent just to make life difficult for the Tories.

    It's becoming clearer by the day what a bunch of callous, morally bankrupt charlatans New Labour truly are. But I guess that's why people like you favour them.


  • Comment number 24.

    And now Boy George is getting all pious about Liam Byrne's note. It was a joke for goodness sakes (OK with a fair amount of truth). No need to get on your high horse about it. Boy George really is a Tory automaton without any sense of humour whatsoever.

  • Comment number 25.

    "if they don't raise VAT it will be a matter of cold, calculating politics; ... Deeply cynical. The only thing more reprehensible would be if they do raise it" - Sagamix

    Which sums up not Tory policy, or economics, or politics but simply your biased view of the current Government.

    According to you, it's cold, calculating and cynical if they DON'T raise it and reprehensible if they DO raise it. So you criticise them whatever they do.

    Do you not see how foolish such a view makes you look?

  • Comment number 26.

    Or Nick, how about this?

    Gideon, that renowned political genius of the Tories, suddenly announce in the Budget:

    "Gosh, look, that nasty Gordon Brown hid squillions of pounds of spending that we, you know, we just found out about! So VAT will go up to 21% to cover this, and, you know, all of the manifesto spending commitments that we promised just won't be delivered because, you know, we just didn't know about all this spending!"

    Nick - don't follow the rest of the media down this path. You're being played.

  • Comment number 27.

    I see that the CON_DEM conspiracy is intending to appoint an extra ONE HUNDRED new peers in order to push through their plans for 'constitutional reform' (AKA, gerrymandering to ensure we can never vote them out)

    If all one hundred get their snouts in the trough for £50k of expenses (amount grubbed by baroness Warsi) then that will cost us an additional FIVE MILLION POUNDS + on-costs.

    (At the same time they are setting aside £2bn to cover redundancy payments in the NHS)

    £5 million for more peers - good value?

    They keep on about 'change' but how is this continuing frenzy of jobs for their mates any different from labour?

  • Comment number 28.

    jobs @ 23 wrote (not to me, thankfully!):
    It's becoming clearer by the day what a bunch of callous, morally bankrupt charlatans New Labour truly are. But I guess that's why people like you favour them.


    >>

    Nice to see the election hasn't mellowed you.

    It's pretty much accepted that all parties pre-election were reticent about the severity of the measures that would be required to deal with the deficit. This was, as AP suggests in post 2, cynical. They all decided that to be honest would have been a tactical mistake.

  • Comment number 29.

    I was very surprised to learn recently, that out of the £600billion govt budget, a staggering £200 billion is spent, not on the NHS, not education, not defence, but WELFARE!!! 1/3 of the total govt budget spent on giving our money away to people for doing NOTHING!

    This is a national disgrace. I tell you what George...here's a quick, easy & smart way to reduce the deficit....take it all out of the welfare budget that contributes nothing to the economy.

  • Comment number 30.

    The new Office for Budget Responsibility is sadly about nine years too late.

    The late, deeply unlamented Gordon Brown has personally left a massive hole by inflating a huge public expenditure bubble of some £500,000,000,00 since 2001.

    That is criminal, in the widest sense of the word, and unfortunately, both the Tories and Lib-Dems did not protest enough whilst this was going on over the past decade.

    Now they expect us, the people, to feel the pain of their irresponsibility and pick up the tab, probably for the next ten to fifteen years; in paying this massive debt down.

    Politicians, you would be justified in loathing them.

  • Comment number 31.

    #23 The idea that Labour operated a 'scorched earth' policy is also straight out of the Tory spin machine designed to soften people up for pain which they declined to mention during the election. I think you'll find that Labour cut departmental budgets for both last year and this and as a result the budget deficit came in £15bn below that originally forecast.

    Yes there's a massive budget deficit but Dave and Boy George simply don't have the leadership or economic ability to steer us out of it.

  • Comment number 32.

    18 -tom dolan -totally agree good blog!!

    VAT is not just a tax of consumption Gerry - if you have a low income and that includes large amounts of pensioners and disabled people every single thing that you need to buy (not for pleasure but for absolute need) is more money coming out of your very small income. Which by the way does not go up with inflation. Some of our disabled people get a little help with their heating and rent but not much, Council tax and food takes up most of their income. There is nothing left for a packet of biscuits or a bar of chocolate let alone a night at the theatre!!!!

    They should of course get more help in the home but the social services are either so stretched or not competent enough that many of our genuinely poor members of society are left struggling from day to day. Any cuts in the salaries of the 'fat cats' of the public sector will be welcome. You can be sure that so many deep and longlasting cuts will have to be made and you can bet your bottom shilling that the first to suffer will be the disabled and the pensioners. So much for a labour government that put its very weakest members of society first!!!May they long stay out of power!!!!

  • Comment number 33.

    The entire taxation system ought to be scrapped and rewritten, tinkering with the current shambolic unfair system is just going to shift the unfairness around while making it even murkier and harder to understand.

    Nobody should be paying tax if their income is so low that they need to be given benefits or 'tax credits' - it's ridiculous and wasteful to take and then repay.

    Ditch NI completely - it is no longer serving its intended purpose and everyone knows the money goes directly into the general tax pot. No more pretence.

    Start by working out how much is needed to provide core services - health, social care, education, law & order, defence and a 'safety net' for those not earning. Then set income tax, company tax and VAT rates so that they are predicted to meet that requirement. Use money raised from other taxes - such as those on fuel, cigarettes and alcohol; import taxes, etc. - to start paying debts off.

    This split will ensure that core services are still funded - after all, we pay tax solely so that the government has the wherewithal to provide services for its citizens.

  • Comment number 34.

    Has the chancellor just told us that there will be no tax increases beyond those he's already announced
    - a new bank levy which should not be enacted until after the G20 in Toronto because the EU has already committed to a bank levy – with or without the acceptance of the bewailing, ever lamenting United States of America; and
    - an increase in capital gains tax, but not on businesses, just on you and me and the rest of the working poor which is getting poorer.
    To speak plainly, I don’t think (certainly can’t see) that the Coalition Government has a clue how to reduce the deficit without raising taxes. Osborne re-iterated his commitment to let spending cuts take around 80% of the burden; so where is the list? Have I missed the list?
    So, provided the new Office for Budget Responsibility does not conclude that the hole to be filled is even bigger than feared…Doesn’t it know? Did the Labour Government not keep books? I’d be embarrassed if I was the new Office for Budget Responsibility & I had to admit that I didn’t know what was in the budget. Of course, it has till June 22cd to figure it out.
    You know what? THE HOLE IS BIGGER!
    You cannot know how deep, how wide and how extremely dangerous until a full audit is conducted, toxic debt (aka CDOs) revealed and written off, and then suddenly voila: THE HOLE!
    Watch you don't fall into it because you will likely end up with the other PIIGS.

  • Comment number 35.

    and would restricting tax relief on pension contributions count as a tax rise or as something else.... ?

  • Comment number 36.

    Nick

    I posted this on Steph Flanders blog but can you also ask the question and see that it is addressed

    I hear that they are going to include the figures for the Enron style off balance sheet Pensions and PFI debts as well to the debt figures and I welcome that but the real elephant in the room now is can we reduce these levels of debt before the demographic time bomb hits.

    Labour may have now engineered a situation where our children can never earn enough to pay off this debt.

    If they can pay it off in time will their lives be blighted for decades to pay for Labour spending spree then for the demographic time bomb?

    If we do not view the national debt against the falling proportion of the population in work and greater numbers of pensioners and school children then we will not deal with this situation properly and leave our kids in the ****.

    I have three children who are just starting out in life their lives could be as debt slaves to pay for Labour economic destruction.

  • Comment number 37.

    No comment of the Civil Servant Bonuses I see.
    One very popular step methinks would be set a cut off point above which no one in the public sector is eligible for a bonus.
    Set it at say £40K or whatever the threshold for paying super tax is. That way those who do the actual work get the bonus and those who sit in offices drinking coffee don't!

  • Comment number 38.

    I think Sagamix is really Gordon Brown in disguise!!!!! tend to leave him alone

  • Comment number 39.

    29 - Stu - good idea but maybe better idea would be to create a system whereby everyone who did not take a job within the first three interviews should do voluntary work where it is absolutely needed. i.e. welfare in the community - maybe then we could save plenty of money because we would not have to pay overtime to those community services who seem to be making quite a nice little packet for a couple of hours extra work!!!!

  • Comment number 40.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 41.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 42.

    26. At 12:19pm on 17 May 2010, Cuse wrote:

    "Gosh, look, that nasty Gordon Brown hid squillions of pounds of spending that we, you know, we just found out about! So VAT will go up to 21% to cover this, and, you know, all of the manifesto spending commitments that we promised just won't be delivered because, you know, we just didn't know about all this spending!"

    If the outgoing government had had the base decency to have a spending review BEFORE the election then you would have a point. But they didn't. They lied. Not the Tories fault.

  • Comment number 43.

    29. At 12:24pm on 17 May 2010, stu wrote:
    I was very surprised to learn recently, that out of the £600billion govt budget, a staggering £200 billion is spent, not on the NHS, not education, not defence, but WELFARE!!! 1/3 of the total govt budget spent on giving our money away to people for doing NOTHING!"

    Its redistrution innit. Take from the hard working and give to the useless.

  • Comment number 44.

    32. At 12:28pm on 17 May 2010, anji wrote:
    18 -tom dolan -totally agree good blog!!

    VAT is not just a tax of consumption Gerry - if you have a low income and that includes large amounts of pensioners and disabled people every single thing that you need to buy (not for pleasure but for absolute need) is more money coming out of your very small income. Which by the way does not go up with inflation. Some of our disabled people get a little help with their heating and rent but not much, Council tax and food takes up most of their income."

    Tax and food are VAT exempt so the people you mention won't pay any increased tax? Where's the problem?

  • Comment number 45.

    I don't mind if 500 new peers are appointed. As long as the HoL has enough of a majority to ensure the UK's new government can pass legislation to sort out the financial chaos that Labour brought about, remove the thousands of new laws that don't work, remove the Big Brother laws that snoop and intrude on our every way of life, allow changes to the HoL which ensures the likes of Mandelson, Martin, Treasonman (ex FA), Adonis, Scotland and all the other troughers in that place never get put on the taxpayers expense again (Prescot etc.).
    Small expense to bear for a few years, Brown probably spent that much in Nokia mobiles and damage to car upholstery.

  • Comment number 46.

    Well my English cousins, what's that saying again? "Be careful for what you wish for" I'm guessing that wish will be granted in full quite shortly, well for those with middle income! and certainly for those in the lower income. Anyone else in the higher echlons will truly prosper further!

  • Comment number 47.

    "I hear that they are going to include the figures for the Enron style off balance sheet Pensions and PFI debts as well to the debt figures and I welcome that but the real elephant in the room now is can we reduce these levels of debt before the demographic time bomb hits."

    Fairly simple solution - they don't get the pension. The private sector pensions were trashed by Brown, so I see no need why we can't now anihilate the public sector ones.

    Here's your pot - buy an annuity. Final salary scheme? What's that?

  • Comment number 48.

    36 Portcullisgate

    Spot on - Pensions, PFI and PPI.

    Apparently the Red Book is to include all these "Elephants". once we have been given a proper end of New Labour Balance Sheet then we know where we are.

    Growth in the Economy is the real problem here and it will be interesting to see how GO predictions differs from GO's come the emergency budget day. If GO's predicts lower growth than AD's then the markets would react adversally. But AD's were considered highly optomistic by no other than GO.







  • Comment number 49.

    Anji:

    Yep, I know where you're coming from ref VAT and I accept your point. Maybe thats why some items are VAT exempt or charged at a lower rate. To be brutally honest, I wasnt making any particular point or trying to bring anything enlightening to the table, I was simply making fun of Saga for extolling the virtues of taxation so long as it isnt him or his fellow travelling Fabianistas who are dreaming it up or even worse, paying it.

    Also fully endorse your point about the poor quality of service delivery. Often, it was not so much the idea that let NL down, it was the delivery of the idea/service. I saw a quote last week re the NHS which went along the lines of "a system is only as efficient as it ever needs to be, not as efficient as it can be". A lot of the time this is down to poor quality leadership, which unfortunately is reflected across many government departments, from secstate all the way down to police, armed forces, civil servants at C and B grades, etc.

  • Comment number 50.

    @watriler 'cui bono'

  • Comment number 51.

    #11, sagamix:

    "regressive tax that it [VAT] is"

    I simply don't understand why so many people call VAT a regressive tax. It isn't. It penalises only those who can afford to spend money on other things once they have already paid the rent (no VAT), bought their food (no VAT), and paid the fuel bills (reduced rate of VAT).

    If you're poor, then those things are going to take up most of your outgoings, and there is no VAT to pay (other than the reduced rate on fuel, which I doubt they will be putting up).

    I would rather not see any tax rises at all. But given the huge hole we are in, then realistically, we are going to have to have some. If putting up VAT to 20% helps to balance the books, then I don't have a huge problem with it.

  • Comment number 52.

    44 - smiling edballs - you jest I am sure!!!!!!! my point being obvious that they cannot afford the items that have no tax so how can they possibly afford the items that do - or are you happy to see the very weak and vulnerable become the forgotten in society. obviously you are.

  • Comment number 53.

    How much does it cost to set up and run an Office for Budget Responsibility

  • Comment number 54.

    #33 Megan

    That way lies hypothecation, something I'm in favour of but until now the political view is to avoid it because of the wrigle room that chancellors need.

    Hopefully the new OBR and a new way of thinking might just get us to the stage where we know how much of the money raised from us in various taxes is actually being used for the originating purpose. By this I mean that NI should pay for the health service and pensions, road tax and petrol duty should pay for roads etc.

    Let's see if the boys have the courage to move towards it.

  • Comment number 55.

    I see no reason why anyone in the PUBLIC sector should be getting
    paid more than £100K per year. No one should get more than the PM.
    Coupled with the pensions and other benifits.

    There are no jobs in the private sector so cutting there renumeration would not see a flight to the private sector.


    PS how long till the Guardian goes bust.

  • Comment number 56.

    29. At 12:24pm on 17 May 2010, stu wrote:
    I was very surprised to learn recently, that out of the £600billion govt budget, a staggering £200 billion is spent, not on the NHS, not education, not defence, but WELFARE!!! 1/3 of the total govt budget spent on giving our money away to people for doing NOTHING!"

    And commentators wonder how the labour vote held up so well, despite theirmismanagement. Here's the answer.

  • Comment number 57.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 58.

    Alistair Darling is just speaking on the radio and is actually saying that he knows borrowing should come down!!!!!! Why on earth didn't he agree to that when he had the opportunity - long before this deficit spiralled out of control. He is also accusing this government of creating fear and concern within the electorate just so they can implement huges tax rises and spending cuts. The audacity of this man who was party to putting this country into the worst economic crisis of recent history. Why on earth are the BBC bothering with these people - it is old politics all over again. Can they not come clean and apologise for what they have done.

  • Comment number 59.

    andy,

    "According to you, it's cold, calculating and cynical if they DON'T raise it and reprehensible if they DO raise it. So you criticise them whatever they do. Do you not see how foolish such a view makes you look?"

    Not foolish - never that. I'm unclear about what's going on at the moment though, that's fair to say. Thing is, there’s definitely something comforting about having a Labour government. Is for me, anyway. Makes me feel warm and safe knowing there’s a Labour Prime Minister running a Labour cabinet and a Labour administration. Which would imply that I’m spooked by recent events, by the undeniable fact we now have a clown installed at number ten. But am I? I’m not so sure. Don’t know how to feel, to be honest. Confused, I guess, is what I am. Maybe we can clear this up here and now - pull me out of the fog, as it were – by agreeing some terminology: is this or is this not a “tory” government? Is it a tory government or is it something else? I really need to know. Why? Well because if it is - if it is the Bad Thing – then I need to get out and about opposing and condemning and generally badmouthing it. Whereas if it isn’t ... if it comes under some other category ... I can take it easy for a while. So what’s the story?

  • Comment number 60.

    Why do we not make more use of variable VAT rates - 10% on black and white TVs, 25% on 32"+ flat TVs, 30% on cars over £60k, that sort of thing?

  • Comment number 61.

    49 - Gerry. Thanks - get a bit concerned sometimes about the disabled as they seem to fall off the radar so often and in my considerable experience they are mostly very optmistic people who really do want to be able to hold their heads up high and contribute to society.

  • Comment number 62.

    11. At 11:48am on 17 May 2010, sagamix wrote:
    Undermining the "tory tax" line of attack is what I mean (1) - if they don't raise VAT it will be a matter of cold, calculating politics; will be Cameron and Osborne firing the first shot of the May 2015 general election campaign. Deeply cynical. The only thing more reprehensible would be if they do raise it - regressive tax that it is.

    ===========

    So in Sagaland they're damned if they do and damned if they don't. Nice to see you being as partisan as usual.

    But isn't there an issue about VAT on the backburner here? Am I right in thinking that the EU is going to tell us what our VAT rate should be sometime soon anyway?

  • Comment number 63.

    #52 anji

    You're getting to the heart of the problem, slowly.

    Food and housing costs do not attract VAT, so any changes in the rate will not affect those areas of expenditure, for everybody.

    We cannot as a country expect the rest of the world to owe us a living, so if we are spending more than we have, we have to spend less. Its a very simple equation, but a hard one to enact, specially when people have been brought up believing the state can provide everything. It can't.

    So, stop whining and lets get on with the job of improving everybody's life, by reducing the amount of money the state takes off us. Increasing taxes doesn't do that which is why, in the longer term, standard tory policy is to reduce it, or at least divert it to legitimate arease, such as consumption.

    Reducing spending is the primary task and then, when the decks are clearing, you can start lloking at better ways to levy taxation.

  • Comment number 64.

    I don't really see what all the fuss is about! It must have been glaringly obvious to everyone that whoever won the election, whether it was Tory, Labour, Lib Dem or a coalution, there was bound to be pretty severe spending cuts in all areas, and some tax increases of one sort of another.

    Increasing VAT to 20% So what? When Darling cut it from 17.5% to 15% everyone said "Whats the big deal? Its only a tiny amount!" so on that very basis, increasing it from 17.5% to 20%? Whats the big deal? It's only a tiny amount.

    Get used to the fact that everything's going to be cut and you're all going to be slightly worse off than you were before.

    There's no way to avoid it, and whinging (probably the only thing that UK is internationally reknowned for these days) doesn't make it go away.

    You all wanted "Dave" as Prime Minister, so basically, belt up and get on with it.

  • Comment number 65.

    "+ Tax credits only on those under £40k/yr
    + Child benefit - all first children get it then it is means tested - only applies to those with 3 children or less. Big families need to take means tested benefits.
    + Increase all fixed penalty fines to £100, £200 if not paid within 28 days.
    + Make fines for Drink Driving, where there is no accident/injury related to income eg: Belgium fine is 10% of salary and 6 weeks ban.
    + Include "bad" foods in VAT scheme eg: Chocolate, Confection, Fast food chains, Crisps and fizzy drinks
    + Increase annual car tax on vehicle emitting over 200gms/km to £1000/yr
    + Increase the scope of VAT to include; private school fees, travel tickets, books/magazines, and childrens clothes"

    Dibbyspot, there are some very good ideas in there, notably adding vat to unhealthy food and higher income related fines. There is some danger in encouraging right wing sympathies if the average wage earners and families are continually subsidising those who choose to live on benefits by increasing the cost of childrens clothes by nearly a 5th say while many on benefits get assistance with these kind of purchases.

  • Comment number 66.

    45. At 12:48pm on 17 May 2010, RTJ199 wrote:
    "I don't mind if 500 new peers are appointed."
    =========================================================

    Neither do I - I just mind paying for them.

    Apparently one of them is thought to be Angela Knight, failed Tory MP and head of the British Bankers’ Association. Obviously the bankers have done such a good job for the country that the new conspiracy government wants to reward their leader.

    So far we have: ~£2.5 million on a cabinet which includes ministers with out any job, ~£5 million on yet more peers and a new quango with no stated limit on it's cost.

    Is this the much trumpeted CON_DEM efficiency?

    How is this constant jobs for your mates & yet more quangos with no real work to do any different from Labour?

  • Comment number 67.

    Pensioners Income DOES go up with inflation (or will)

    In future it will be linked to the HIGHER of

    Retail price Index
    Earnings Increase
    2.5%

    No more 75p (taxable) increases!

  • Comment number 68.

    31. At 12:27pm on 17 May 2010, APbbforum wrote:
    #23 The idea that Labour operated a 'scorched earth' policy is also straight out of the Tory spin machine designed to soften people up for pain which they declined to mention during the election. I think you'll find that Labour cut departmental budgets for both last year and this and as a result the budget deficit came in £15bn below that originally forecast.

    Yes there's a massive budget deficit but Dave and Boy George simply don't have the leadership or economic ability to steer us out of it."

    Excellent point. Budgets did indeed go down last year, and they will continue to drop over the next few years. I know my little corner of the public sector empire is budgeting for a 4% year on year reduction for the next five years. The 'scorched earth' policy propped up the private sector in order to stop the UK heading toward a depression. It's naieve to blame the public sector for the deficit.

  • Comment number 69.

    sagamix - good to see you up and at 'em. But please don't forget the bedtime story tonight. Animal Farm might be good.xxx

  • Comment number 70.

    VAT brings in a lot of revenue and is difficult to evade. That's why governments are always tempted to increase it. However, it is a regressive tax because it is not linked to ability to pay. A VAT hike might be seen to conflict with Cameron's statement that those with the broadest shoulders should bear most of the burden.

    People on low incomes buy a range of goods in their day-to-lives, some of which are exempt from VAT and some of which aren't. To suggest that poor people are protected from VAT rises because most food is zero-rated is factually incorrect and morally unattractive.



  • Comment number 71.

    I would think the rating agencies may come into play over this. But of course the bankers have been fighting any new regulations concerning their gambling habits and who pays for them and what we are learning is that the rating aqgencies are as much a part of the financial collusions as the banks and investment firms..so depending on the deal, how it all plays out. Nothing has changed and the banks are still in control and it is not in their interest to have the debt paid off because they are making money on the very debt they created. I predict another boom year sof rthe banks and no so good for everyone else. Remember they were bailed out to insure that funds would be available to support small business and that has not happened...they just kept the money for themselves. Without changes in the financial structure things just will not improve for the economy.

  • Comment number 72.

    RBS announced a further 2600 (I think) job losses last week, bringing their total job cuts over the past 18 months or so to >26,000. I assume they feel that the end-user (us) will not notice a significant drop in the quality of its service - if we did we'd all move our business to one of the many RBS competitors.

    Given the size of the NHS, it would seem that cuts of around 10x those could be achieved by employing the same, ruthlessly efficient, money-saving methods. Cutting out whole tiers of management and combining 'back-office' jobs seems to have been the RBS philosophy.

    Would removing 250,000 NHS admin staff (over 2-3 years) not make the whole sad Soviet monstrosity rather better?
    A touch of the Admiral Bynge's (sp) might not go at all amiss - along with a salary cap @£100k for any administrator- who should NEVER be able to earn more than the highest-paid Consultant within his Trust. The NHS should reward medical specialists - not 'paper-pushers' and 'Whitehall target-achievers'.
    Pointless people admin staff, necessary at a low and middle level, I grant you, but over-powerful and arrogant further up the food chain. Strategic decisions should be made by a directly elected Board and the funding requests sent directly by the Consultants working together as a team in any Dept.

    Whitehall should have no part in running the NHS at all - it should be local Trusts doing what local people want and can afford. Whitehall could then have a 'spreading best practice' role, concentrating on ensuring that every Trust Consultant is made ware of advances made elsewhere and they should be encouraged to copy and further improve on them.

    A standard uniform and standard paper-work throughout the whole NHS would be a start too, with contracts published so that there could be competition between Trusts to source items cheaper than their competitors (think Waitrose v Tesco v Netto)

  • Comment number 73.

    59 - Foolish, confused and, it would seem, rambling.

  • Comment number 74.

    #1 Spot on. They said during the campaign that they had "no plans" to increase VAT therefore doing so now would be politically suicidal.

    #2 Get real. They said spending would take up most of the deficit reduction and they now say it will be 80% - what's wrong with that? Sounds like a desperate miffed socialist scratching around for something to moan about.

    Also - they are creating the OBR to solve exactly the problem they had in the election campaign - Labour did not do the customary spending review so without details of how the books look, how can anyone properly formulate policy? The OBR is designed to show people what the state of play really is without there being any suggestion of party political interest.

  • Comment number 75.

    "58. At 1:19pm on 17 May 2010, anji wrote:

    The audacity of this man who was party to putting this country into the worst economic crisis of recent history. Why on earth are the BBC bothering with these people - it is old politics all over again. Can they not come clean and apologise for what they have done"

    Rather harsh on Darling. The die was cast way before he became chancellor. I think he played the hand he was dealt fairly well.

  • Comment number 76.

    sosoomii @ 60

    Yes, and maybe 60% VAT on patio heaters (30% 'luxury tax' plus 30% 'green tax').

    Good idea. I guess complexity is the main argument against it. Even with the existing system, there are disputes (Pringles, jaffa cakes, etc). These would multiply with more bands.

  • Comment number 77.

    22. At 12:02pm on 17 May 2010, AndyC555 wrote:

    "Isn't it great to have a man of principles as Chancellor?"

    I'd rather have a man who understood money, numbers and economics.

  • Comment number 78.

    "sosoomii wrote:
    Why do we not make more use of variable VAT rates - 10% on black and white TVs, 25% on 32"+ flat TVs, 30% on cars over £60k, that sort of thing? "

    Banded VAT would be a good idea (i.e. 15% on items up to £100, 20% on items up to £5000, and 30% on items over this amount) and would certainly stop the accusations that VAT is a regressive tax (it isn't - it is a "luxuries" tax that is just applied to items that aren't really luxuries)

  • Comment number 79.

    59 - What difference does it make what they call the Government? I'd have thought that what they DO is more important. But then, the left have always been hung up on labels haven't they?

    I have a dream....that one day a man will be judged by the content of his policies and not by the colour of his old school tie

  • Comment number 80.

    What sort of Government is this?

    So ask some bloggers.

    Well, it cannot be neatly pidgeon-holed as a Tory or even Tory-Lib-Dem coalition because Frank Field, for one, has been invited to join, this time, presumably to 'do the unthinkable'.

    Possibly the most useful label, if you insist on giving it a label, is 'national Government', implying putting people into job slots that match their level of expertise.

    Now, there's a novel concept.

    One thing is for sure, as expressed by Giles Coren in Saturdays Times, Cameron and Clegg are, according to their peers, doing only the bare minimum expected by the ultra-standards of their respective alma maters.

    So much for the meritocracy, which thanks largely to the politicians 'educational experiments' of the past decades, has, for the vast majority of the people, more-or-less vanished.

    "You're still *^%* peasants as far as I can see" when it should "be getting better all the time".

  • Comment number 81.

    29. At 12:24pm on 17 May 2010, stu wrote:
    I was very surprised to learn recently, that out of the £600billion govt budget, a staggering £200 billion is spent, not on the NHS, not education, not defence, but WELFARE!!! 1/3 of the total govt budget spent on giving our money away to people for doing NOTHING!

    This is a national disgrace. I tell you what George...here's a quick, easy & smart way to reduce the deficit....take it all out of the welfare budget that contributes nothing to the economy.

    ===================================

    I wouldn't mention your view to any elderly, disabled, unemployed, sick or pregnant relations if I were you.

    They may not be so understanding that you don't want to let they buy food or energy in future to save a few quid on the deficit.

    You also fail to understand that what these welfare recipients tend to do with the majority of the money recieved is spend it - which is the basis of the economy (2/3 of the UK economy is based on consumers buying stuff).

    What you propose is neither quick, easy nor smart in any sense of the word.
    It is why such a proposal has not been put forward by anyone at anytime.
    Smaller elements of reform are part of the picture but since for some reason which is quite beyond me the 2 largest elements of welfare, child benefit and pensions have been effectively ring fenced and even enhanced - I cannot see where it is likley to have much impact.

    Anymore bright ideas?

  • Comment number 82.

    56. At 1:17pm on 17 May 2010, Shipshapeandbristle wrote:

    "29. At 12:24pm on 17 May 2010, stu wrote:
    I was very surprised to learn recently, that out of the £600billion govt budget, a staggering £200 billion is spent, not on the NHS, not education, not defence, but WELFARE!!! 1/3 of the total govt budget spent on giving our money away to people for doing NOTHING!"

    And commentators wonder how the labour vote held up so well, despite theirmismanagement. Here's the answer. "


    Welfare in this case includes state pension. According to http://www.ukpublicspending.co.uk/ we spend (in £billions):

    Pensions 119.1
    Health Care 119.0
    Education 84.0
    Defence 43.7
    Welfare 105.1
    Protection 34.7
    Transport 24.5
    General Government 26.7
    Other Spending 83.9
    Interest 27.8

    £100bn is still an absolute fortune, but if you go to the website you can drill down further and see that of that £100bn, only £8.1bn is on unemployment benefit.

    What is actually is frightening is that if you totally remove all healthcare and cut all pensions in half we will only just have stopped acruing debt.

  • Comment number 83.

    If Mssrs Cameron and Osborne want to fill their budget gap and also convince the public that they're not guilty of "saying anything to get elected", they might be smart to follow their own advice and put a measured programme of soft-drug legalisation, regulation and taxation in place.

    David was for this during his run for Conservative leader:

    http://www.independent.co.uk/news/uk/politics/tory-contender-calls-for-more-liberal-drug-laws-505824.html

    The Lib Dems have always been pro-debate on drug issues... now could be a very convenient time to make a stand against Labour's terrible record on the failed war on drugs and help the economy at the same time. Let's take all that cash out of the pockets of criminals and put it into the pockets of legitimate businessmen and the tax man.

    Or has Mr Cameron lost his principles now that he's got newspaper editors to keep happy?

  • Comment number 84.

    59. At 1:22pm on 17 May 2010, sagamix wrote:
    Is it a tory government or is it something else? I really need to know. Why? Well because if it is - if it is the Bad Thing – then I need to get out and about opposing and condemning and generally badmouthing it. Whereas if it isn’t ... if it comes under some other category ... I can take it easy for a while. So what’s the story?

    =============================

    Saga, was New Labour, a labour government?

    Don't fall into the simple trap of judging things by their labels. Surely judging a new government by the record of a government with mostly different people, but the same name is no different to any other form of prejudice.

    You may be surprised to hear this, but I was somewhat concerned about a tory majority, because they may go too far, or they would simply get the blame AGAIN for cleaning up someone elses mess and be unelectable for ever.

    I think you can rest assured that this isn't a tory government in the way that you expect - this is something new, and if we're lucky it could be a real breath of fresh air.

  • Comment number 85.

    re #1 & 11
    Saga, old son, you can't have it both ways. Do you know, technically, what VAT is for? Most Chancellors, in recent years, didn't or forgot - conveniently or otherwise. Until the Budget is out of the Chancellor's lips I won't get overly excited.

  • Comment number 86.

    Re possible VAT rises. It's worth noting that Labour were considering putting up VAT as well. Also, they had tabled the idea of putting VAT on food as well. The IMF has also suggested that VAT may need to be charged on food to start getting the deficit under control.

    Personally, I'd rather the VAT rate went up to 20% or 22% rather than being left at the current rate but with it being added to food. (Though, it could maybe be added to more types of 'luxury' food, such as crisps/chocolate/cakes etc).

  • Comment number 87.

    How nice it would be if a Government was able to set up an office called Budget of Responsibility, especially if that said Government had some very difficult decisions to make. If this then Office of responsibility came forward and said the black holes are much worse than expected more tax rises will be needed. Will the public still see it that the Government is to blame for not taking the right decisions or will this new organisation take the hit on their behalf. I wonder. As I do not believe the Conservatives with the restriction of the Lib/Dems in tow can make the cuts needed I think we will see this happen.

    VAT will rise, either not yet, or in stages, I believe. There is a simple reason for this, Britain is a consumer society and much of its income now relies on service industries. If VAT rises in stages it is more likely that the retailers will absorb some of it to start with. VAT is a very difficult tax because the consumer can either decide to spent or save, this makes it very difficult for the Government to decide how much tax it will raise. Inflation is another reason that VAT is a difficult for Governments. However, and here is where the smoke and mirrors comes in. The Coalition has agreed that this 10,000 personal allowance by the Lib/Dems should still go ahead. Of course this does not help the real poor which was supposed to be the intention. However, it has been decided this PA will be raised gradually over the term of the Parliament. Therefore how useful it would be to use the stage VAT rise for this purpose. To then add further to the smoke and mirror, the NI rise for employees is still to go ahead. Therefore giving with one hand by the personal allowance and taking with the other by NI. Of course the other point is that normally over the term of a Parliament the Personal Allowance would rise anyway therefore people will be no better off and in real terms much worse off. Mmm pretty clever.

  • Comment number 88.

    63 - pennytr8

    Hi penny. If you have a moment try and access my blog 317 on andrew neil's site. We definitely need to concentrate initially on cutting the deficit, I too think this government is worth supporting, if only because it promises some radical rethinking in the way we deal with our society. On the Big Question yesterday one of the panel suggested that the start to recovery was the family unit (in whatever form that takes) but definitely that unit is the underlying factor to the strength of our society.

  • Comment number 89.

    65. At 1:31pm on 17 May 2010, 4dam wrote:

    There is some danger in encouraging right wing sympathies if the average wage earners and families are continually subsidising those who choose to live on benefits by increasing the cost of childrens clothes by nearly a 5th say while many on benefits get assistance with these kind of purchases."

    1) Do people on benefits really get special assistance with buying children's clothes? Have people not heard of charity shops?

    2) The *government* buying children's clothes would not be affected by any VAT increase - they'd pay the increased VAT, but to themselves, so it wouldn't make any difference.

  • Comment number 90.

    11 - I'm assuming you have an interest in politics, given that you have commented on this blog, but I'm having difficulty in understanding WHY seeing as you have impossible expectations - according to your comments, the Government are damned if they do and damned if they don't. What exactly do you think they should do? It takes a particular type of voter (Labour) to be that irrational and negative. Oh hang on...you're not Gordon Brown are you?

  • Comment number 91.

    #23 jobsagoodin
    'It's becoming clearer by the day what a bunch of callous, morally bankrupt charlatans New Labour truly are.'
    Were. They're sweeping that little episode under the carpet. Tony Blair! Who was he?

  • Comment number 92.

    15. Bluenose, you don't seem to have gotten it either. No one won the election. No one. We have an unelected Parliament that no one voted for, with the party with the most politicians being propped up by a party that is supposedly on the left!

  • Comment number 93.


    Savings can be made by making work pay. At the moment an unqualified single girl’s best career move is to have a baby. Labour’s policy of “lifting children out of poverty” has resulted in a whole layer of society (young parents and their children) for whom work is simply not worth seeking. Paradoxically, couples who work often can't afford to have any or more children, whereas for those on benefits, each new baby brings an increase in the family income and means they can't afford to take even more jobs.

    If the benefits underclass took the ‘nasty’ jobs that the E Europeans are only too delighted to perform, the country would have fewer economic migrants and a smaller benefits bill.

    A big slice of the welfare budget are pensions and benefits for pensioners. Items such as cold-weather payments really should be means-tested, I know of ex-pats who spend the winter in the Mediterranean who get this!

  • Comment number 94.

    Nick, do you really think the hole won't be "even bigger than we feared"? Regardless of the actual state of the finances, I would be utterly amazed if George and Dave don't loudly declare things to be "much, much worse than we were led to believe", resulting in them having to take "even more really, really difficult decisions".

    I'm surprised you speculate that this may not be the case! I'm sure the speech announcing the bad news has already been drafted - well in advance of the production of the manifesto.

  • Comment number 95.

    66#

    Good spot Jon.... doesnt look too encouraging, does it?

  • Comment number 96.

    "77. At 1:52pm on 17 May 2010, toni49 wrote:
    22. At 12:02pm on 17 May 2010, AndyC555 wrote:

    "Isn't it great to have a man of principles as Chancellor?"

    I'd rather have a man who understood money, numbers and economics."

    Certainly such a man would have been useful between 1997 and 2010. But that's the point of Osbourne's bold move. Any future chancellor will HAVE to be able to prove that what he says adds up.

    No more "tractor production has risen 5,000% in the last week" style statistics.

  • Comment number 97.

    I totally understand why using VAT is a good idea to get the extra cash. But heres a few problems with it.
    The poor always pay it, everything has VAT on it in some way or another.
    The working class and middle class will also pay it, plus losing any help from tax creditsd. Note that tax credits are also childcare and someone working fulltime would have to pay a childminder £700 per month. Not very good if you are on say 15k a year and take home £1000 a month is it?
    Now we have the Rich with they pay it? Some will be most have ways to avoid paying VAT. Because they can afford to pay some accountant to sort it out for them.
    Why not raise NI for everyone ? Well of course they are going to do that but not for business as it will effect them more! Lets face why would a goverment want to dip into the profit of lots of big companies in this country. How can they codone not taking extra money via NI from a company that makes a billion pound profit a year?
    I totally accept there has to be cuts but at least make them fair. One rule for one and one rule for the rich isn't. Anyone else here can deny this but thats whats happening.
    As for people saying Labour supporters are wanting the goverment to fail. Well its not not about wanting really it about knowing they will fail. Mark my words they will cut to hard the eccomony will stall and back into recession again. Labour will be to blame of course as the hole was bigger then the Tories thought. Lets face it they are not going to say it was smaller are they ?
    Its the good old blame the guy before me!



  • Comment number 98.

    78 - "Banded VAT would be a good idea (i.e. 15% on items up to £100, 20% on items up to £5000, and 30% on items over this amount)"

    Putting (most) Rolex watches in a lower VAT band than Kia cars?

  • Comment number 99.

    It's naieve to blame the public sector for the deficit.
    ---------------------------------------------------------

    Perhaps so. Not entirely inaccurate though..

  • Comment number 100.

    68. At 1:38pm on 17 May 2010, KMBayes wrote:
    "Budgets did indeed go down last year, and they will continue to drop over the next few years. I know my little corner of the public sector empire is budgeting for a 4% year on year reduction for the next five years. The 'scorched earth' policy propped up the private sector in order to stop the UK heading toward a depression. It's naieve to blame the public sector for the deficit."

    The fact that you chose the word "Empire" to describe the public sector shows you exactly why the bloated public sector is to blame for the defecit and why people like yourself will never accept that these cuts are vital.


 

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