Just 'Cause It's Legal It Doesn't Make It Right!

Chancellor George Osborne has today announced he is “shocked” by a fact most of us have been aware of for years – the richest people hang onto their wealth by organising their financial affairs to minimise the amount of tax they have to pay.

Apparently, according to a study by HM Revenue and Customs, the richest people pay an average of only 10% of their income in tax.

However, it is also a fact they are not breaking UK law, but using it to its maximum benefit.

Instead of paying money to the country, they are employing armies of accountants and financial advisers, whose role it is to find legal loopholes, and exploit them for maximum personal gain.

Osborne said:

"I was shocked to see that some of the very wealthiest people in the country have organised their tax affairs - and to be fair it's within the tax laws - so that they were regularly paying virtually no income tax. And I don't think that's right."

Of course, it has only recently become fashionable for politicians to question the morality of legal tax planning (avoidance) measures but it really does pose the question:

Why, has it taken almost two years in office - and even longer as shadow chancellor - for Osborne, to publicly 'wake up' to the fact just 'cause it's legal it doesn't make it right?

Could it be connected to the latest dire opinion polls?

Fuelling A Panic?

 

If ever there was an example of our coalition government's lack of understanding of 'real' people, it's the latest debacle over a possible strike by tanker drivers who deliver the much needed fuel to our forecourts.

Following on from its attempts to promote negative public opinion on benefit claimants, students, pensioners, pasty eaters and anyone else who doesn't live in the 40 percent tax bracket, government 'spinners' thought they would turn us all against the members of Unite union who, apparently, threatened to strike over changed working terms and conditions. Please bear in mind, a strike had not been called; it had only been optioned.

I should point out, I have no knowledge or interest in the rights and conditions of the drivers, or the fact they earn a larger than average wad of money by seating themselves on top of a potential bomb whilst navigating the M25 and other possible roads to hell.

Time for the coalition's manipulators to bring on the clown....

Enter, stage right, government minister Francis Maude who, like a member of Dad's Army, told us not to panic about a possible shortage, but to go and fill up jerry cans with petrol and store them in our garages.

Personally, I don't have a garage and wouldn't know a jerry can from a tanning salon.

It seems, though, I am not the only one without a garage, as someone made the headlines today by setting themselves on fire whilst trying to transfer petrol, between cans, in her kitchen – all while the cooker was working! I should probably now be writing about the decline in the standard of science education but I am still in a state of disbelief.

Of course, when someone from the government says “don't panic” we 'real' people all DO panic. Predictably, we rush to sit in queues waiting to fill any available container we can find to fill.

Those in society above the level of 'real' people send their chauffeurs and nannies to sit in the queues on their behalf – well, this is the big society!!

After three days of extra panicking, queuing and an increase in petrol sales, it appears the tanker drivers' union is going to start negotiating, via arbitration service ACAS, on Monday and any 'strike' won't be 'struck' in the immediate future.

So... panic over?

Not quite, as the poor old oil speculators now have to worry about how they are going to manipulate their financial planning to minimise their exposure to tax, whilst our beloved coalition government will have to pay out enormous amounts of overtime to the civil servants who will burn the midnight oil counting all the additional tax revenue gained from the extra fuel sold during the 'panic'.

Prepare yourself to hear the chancellor pronounce good financial news next month.

Do you get the feeling we've all been taken for a ride?

Pensioning Off Our Right To Retire...!

The Work and Pensions Secretary, Iain Duncan Smith, has unveiled details of his plan for reform to the welfare system.

While he is correct that the present system is ridiculously complicated and needs simplifying, he is wrong in his assumption that most people want to stay in work indefinitely.

He claims that most people want to work up until, or past, the age of seventy when what we all really want is the choice to work beyond the present retirement age and not to be forced into a longer working life.

Of course, it is convenient for members of the government to take this view, as the longer we all work, the longer we are paying taxes and the longer they can delay paying out the pension. Mismanagement of the pension pot, the increase in our expected lifespan and the larger numbers of those of us who are eligible to claim, means there is a huge black hole in said pot.

Employers, though, do not want to be forced to keep people employed at an age when they are often not as productive as they once were. Healthy business needs new blood, with new ideas and enthusiasm. Most employers will, therefore, work around any legislation by finding loopholes like misdemeanors as a method of dismissing the aged employees. This will cause understandable friction and lack of trust in what were once loyal workforces and happy companies.

If people stay working for longer, the young remain unemployed - and often on benefits - for longer. The assumption there are jobs for all is totally flawed.

So, at one end of the equation we have people paying taxes for longer, while at the other, the government are paying out benefits for longer.

With a reduction in benefits also becoming part of the reforms, it is less costly to pay young people the benefit than it is to pay retired people the state pension. It is nothing more than spreadsheet politics.

Labour MP Stephen Pound summed it up by saying:

‘Forcing people to work on indefinitely condemns young unemployed people to the dole and destroys the life chances of older people who have spent 30 or 40 years working for a productive retirement – it is pretty cruel.’

and

‘Perhaps if you are a hedge fund manager you do not have the same level of exhaustion as a panel beater, but most people have had enough after 40-odd years.’

Well, I am neither of the above but I definitely know when I have had enough!!

Fuel Your Anger At MPs Not Road Users!

With fuel prices continuing to rise on the back of the political unrest in the Middle East, it is understandable that fuel users here are becoming increasingly frustrated.

It is tempting for campaigning groups to contemplate taking direct action by staging ‘go slows’ on major roads or blockading oil refineries.

While it may be understandable that some may see this as the only outlet for their anger and frustration, the problem is: they are harming the very people they are trying to help.

We all have to use the roads and none of us want to be part of the disruption or loss of business arising from demonstrations about high fuel costs.

Ultimately, the only people who can help to alleviate the problem are our politicians. Our coalition government can help by stabilising the amount of revenue collected from the fuel we use.

Many MPs are already sympathetic and those who aren’t will not want to suffer the inconvenience of answering a mountain of complaints from their constituents.

The immediate answer, then, is to sign a petition such as this or write/phone/email your local MP asking him/her where they stand on the issue of fuel pricing and the part taxation plays on the forecourt price of a litre.

You can find the contact details of your local MP here

Is Vince Cable A Fool Or A Mischief Maker?

Is this the face of a fool or the face of a mischief maker?

Business Secretary, Vince Cable, who has long been respected for his forthright views on the economy and his personal reservations about his party’s power sharing coalition with the Conservatives, has been caught in a ‘sting’ by two journalists from the Daily Telegraph posing as single women from his constituency.

During their recorded meeting, Mr Cable is said to have described dealing with his coalition partners as like “fighting a war” and while talking of his options said: ”They know I have nuclear weapons, but I don’t have any conventional weapons. If they push me too far then I can walk out and bring the government down and they know that.”

Mr Cable is widely known to be disillusioned with recent political events, after being embarrassed by his party’s change of policy regarding the rise in university tuition fees and the resistance of the Conservatives to force action against the banks.

His biggest ‘sin’ however, was to boast he was personally at war with the Murdoch publishing empire and he would do everything in his power to make sure it was blocked from taking control of the BskyB satellite network.

The Prime Minister and Deputy Prime Minister have now announced that Mr Cable is to be stripped of his responsibilities for any decisions regarding media and broadcasting, although he will still keep his (much reduced) business portfolio. He is said to be feeling ‘foolish’.

A statement from Downing Street stated:

“The Prime Minister is clear that Mr Cable’s comments were totally unacceptable and inappropriate.”

But then he would say that. The PM has a lot to thank Rupert Murdoch for; after all, the publishing magnate’s newspapers backed the Conservatives in the lead up to last May’s elections.

So is Mr Cable a fool?

I find it hard to believe that someone of his intelligence and experience in politics would be tricked so easily by an audience of two women he did not know and to whom he was to make such unguarded and unwise statements.

Is he a mischief maker?
 
Well, if he had been sacked from his role in government, he would be free to form a splinter group of Lib Dem MPs; they are known to be tired of the way the Conservatives have been using their party to absorb the public’s displeasure following the coalition’s recent policy announcements. Had he been sacked, Cable could have forced an early end to the Coalition.

Whatever he is, he has now demonstrated all is not well amongst those public smiles portrayed by the Cameron Cabinet in the media.

Leader of the Opposition, Ed Miliband has today commented that these revelations prove the coalition is just “a sham”.

Give the man a cigar! That’s something many of us have known since May!

Green Energy Could Make Us All Sick!

A story in today’s Daily Telegraph reports that household electricity bills are likely to rise by around £500 per year to pay for the additional investment needed in green energy.

Britain is obligated to increase its share of energy from renewable sources from 3 per cent to 15 per cent to meet EU targets but of course, these targets have not just suddenly appeared, they have been ignored until the last possible moment.

Q. Why have the utility companies not been re-investing in green technology over the past years?

A. They have been too busy sharing out their large profits through the payment of bonuses and dividends to their shareholders (many of whom are from overseas)

Once again, it is us, the consumers, who will be picking up the bill.

Can We Really Afford The Cost Of Stealing From The Courts?

The Justice Ministry has announced the cuts it will be making to the courts system following the Coalition’s spending review. Justice Minister, Jonathan Djanogly used the customary LibCon ‘get out of jail’ excuse for the cuts saying the present system is “unsustainable”.

93 Magistrates’ courts will be closed along with 49 County Courts but according to the Minister, at least 85 percent of people would be no more than an hour’s travel away from a court if they made use of public transport. That’s good then!

The only flaw to that argument, is many of those who would be likely to appear in front of a magistrate or a judge, do not have the available cash to be able to afford the fare for an hour’s journey using public transport - they will just fail to turn up! The police would then have to waste their own reduced resources in following up and executing any warrant issued.

Those courts still in operation, will be under growing pressure from their increased workload, causing longer delays before cases can be scheduled for a hearing. Both the accused and the accusers are likely to have to wait much longer before justice can be seen to be carried out. Eventually, the system is in danger of becoming gridlocked and cases of being diluted.

The government has argued it will make a saving of at least £15m a year in the day-to-day running costs of courts and around £22m in maintaining the premises. Of course, they will also be able to claw back a considerable sum by selling off the buildings which housed those courts facing the axe.

Overall, though, the saving seems a pittance compared to the total deficit faced by us all. With jobs being lost daily and repossessions on the increase, crime is likely to be one of the only growth industries over the next few years.

Such ‘spreadsheet politics’ could eventually prove to have a greater cost than that we are already paying!

The Debt Just Won't Die!

According to a survey by MyVoucherCodes.co.uk of almost two thousand 18 to 35 year olds, 98pc said they think they'll still be in debt on their death bed.

Eight out of ten of those asked said they thought it was far too easy to borrow money through their bank, or on credit cards.

Other points revealed in the survey were:

• 54pc thought they would always need to borrow money in order to fund the lifestyle they wanted.

• Just over half who owed money did not feel in control of their debt.

• 8pc admitted they had needed to ask for help with repayments from a friend or family member.

• One in five also claimed they were not worried about the possibility of their debts being passed on to their next of kin.

Isn’t it good to know we'll be leaving this world in such safe and positive hands.

-

Are Our Students Becoming Our Teachers?

There must be something about the quality of the lectures on a Wednesday afternoon, for only two weeks after the Millbank riots in London, our students are once again …well…revolting.

All over the UK, thousands of young - and presumably intelligent - folk have decided to demonstrate their immense displeasure and opposition to our Coalition Government’s intent to make further education a luxury, rather than a right, through introducing a massive increase in fees and the removal of the Education Maintenance Allowance.

Sadly, though, many are just focusing on the man whom the Tories have set-up to be ‘cannon fodder’ to the students’ ire, Deputy PM Nick Clegg. While this may be understandable, given that he appears to have been economical with the truth while canvassing for them to vote for the Lib Dems back in May, they need to pause for breath and see the bigger picture.

Admittedly, Clegg appears to be a self righteous, pompous, oaf. He is a man who has no hope of defending the indefensible, how ever many times he appears in the media telling us that he now sees things differently from six months ago. He knew then, as did all his colleagues, the state of the nation’s finances. There was, after all, rarely a day when his party’s Vince Cable was not ‘mugging’ the media spotlight telling us all we are on the verge of bankruptcy. Clegg is, therefore, either a fool, or he deliberately misrepresented the truth to gain the maximun student vote.

Sadly, it is not just the students who were hoodwinked by the false promises of the Lib Dem leader. Many of the extremely hard working and loyal members of his party (including those who stood for election) feel betrayed and will now have to face the anger of the people who so willingly gave them their votes. Clegg, meanwhile, will be protected from such front line hostility, by the blanket of security which surrounds a deputy prime minister.

However, Clegg is in reality, just the ‘fall guy’ for the real villains who are the Conservative Party. They aim to destroy the hopes and aspirations of anyone who did not go to a school where 'having a fag' had a totally different meaning to the same expression used to describe smoking by those in a state school.

I sympathise with the students - although not with the violence shown by many - and I hope by their actions they are inspiring other groups, who are similarly under attack from this government’s unfairly targeted cuts, to join the fight against the Tories’ ‘single class’ society.

We are supposed to be a Democracy where opportunity is available to all. Let’s see just how deafening the collective voices of fairness can be!

Boris Johnson's Ethnically Cleansed TV On The Radio!

London Mayor, Boris Johnson's widely reported remarks, criticising the coalition government for their proposed draconian housing benefit reforms, appeared at first sight to be spontaneous.

But, I wonder, if they were that spontaneous, why did he have a television crew filming what was supposed to be a regular radio interview with broadcaster Vanessa Feltz.

It seems his comments might not have been so 'off the cuff' after all!

He's A Liar Liar

Whether you agree or not, a lot of work must have gone into this!

Try singing along....

The Ins And Outs Of The Economy - It's Simple!

OK. so here’s my theory...

Our country is in a fiscal mess because there is not enough coming in through taxes to cover the amount going out via government spending.

Cutting the number of people claiming benefits from the state and telling them to get jobs will, theoretically, save a large part of our 'overdraft'. The only problem is: there are not enough jobs available for everyone who is currently out of work, let alone those who will come off benefits to seek work.

A recent survey by the Federation of Small Businesses revealed that almost 11% of business owners expect to decrease employment over the next few months, due to weak business confidence in future prospects and revenue growth. Even more workers will, therefore, become unemployed, stop paying tax and start claiming benefits. Result: the country slips into an even worse mess.

For business owners to regain confidence in the economy, we all have to spend money buying their products which in turn allows them to take on more staff, who then pay more tax and increase the government’s revenue, thereby reducing the deficit. Simple isn't it? Errr well not really!

An alternative option is to increase the rate of tax paid by those who are in work and in indirect taxation like VAT. But then, we will all have less disposable income to buy the goods which in turn create the jobs. Companies then collapse, more people are unemployed and the taxes raised decrease yet again

Of course, the experts would tell you it is more complicated than my simple view.

Our coalition government is about to announce a blanket 'cuts all round' programme to immediately claw back some of its losses. For the reasons given above, though, it is likely to be a lose, lose situation.

Whatever the Chancellor decides to do tomorrow, it is certain to cause massive hardship for those who are already struggling.

I am becoming increasingly convinced, we are in danger of causing more problems than we are ever going to solve.

But then.....what the heck do I know?

Lib Dems - What A Difference A May Makes!!

"If we have learnt one thing from the economic crisis, it is that you can’t build a future on debt."

The words of the Lib Dem leader, Nick Clegg, on 28th April 2010.

So, how come he is now agreeing to anyone who has aspirations for a better education, leading to a better future, to saddle themselves with debts of up to £40,000 before they even start trying to find a job, in a marketplace where jobs are becoming rarer than hen’s teeth?

What a difference the events of the month of May have made to the credibility of the Liberal Democrats!

The Benefits Of A Fairly Unfair System!

I doubt there is anyone who can dispute we are in a financial mess and something needs to be done to control the enormous interest payments we are making to foreign institutions and governments for our borrowing.

The most obvious and headline grabbing saving, is to reform the vastly complicated and financially draining benefits and welfare system. It is a system that many voters regard with contempt, mainly due to the negative stories in the press of benefit cheats and scroungers, so it is a reform that few will oppose. After all, it is rare we get to hear of the majority, who have only survived because of the help they receive from the system.

Chancellor George Osborne, has today announced a total restructure to bring fairness for all, while making the system cheaper to administer and easier to understand.

In the interim, he announced that universal child benefit, payable to all families whatever their income, is to be stopped for those who earn around £44k per year.

At the other end of the scale, no family will be able to claim a total benefit greater than the national average wage received by a family in full-time work - thought to be around £25k per year.

On the face of it, this does seem like a fairer system, as those who can afford it lose a freebie and those who can’t don’t gain financially by remaining out of work.

However, when looking at the figures supplied by the BBC, it seems that those at the top end will only lose around £1.7k for a family with 2 children while a family receiving full benefits will lose anything from £4.5k to £15k per year.

Work and Pensions Secretary Iain Duncan Smith told the BBC: “I don’t love the idea of this, you know”

Neither will those who are genuinely unable to find work and who are about to be hit the hardest!

If You Want A Job...Show Some Thigh!

While the Coalition Government is in full swing branding anyone receiving benefits as ‘work shy scroungers’ and blaming them, alone, for the massive hole in the country’s finances, it is worth recounting the advice a friend of mine was recently given.

She is in her mid thirties, is long term unemployed and has brought up 2 great kids (one of whom is about to start college), alone, and with no hope of additional help from a family. She desperately wants to find a job and has applied for many. She wants nothing more than to get off ‘the system’ but has no formal qualifications and, more importantly, little self confidence. With each rejection, her lack of self worth increases.

Her personal ‘work adviser’, at the local Job Centre, enrolled her on Launch Pad, a government funded scheme aimed at equipping those who have been long term unemployed, to regain the skills and confidence they need to secure that all important opportunity of work.

In a recent one-to-one interview with her course ‘mentor’ (a woman of middling years), she was given the following incredible piece of advice for attending formal job interviews:

‘Wear a short skirt and soften the tone of your voice’

True Genius!

Maybe the government should stop attacking those out of work and start looking seriously at the type of contractors they are paying huge sums of money to impart such sexist and stupid ‘skills’ advice!

Asda First To Help Us 'Cash Cows'

(graphic from PetrolPrices.com website)

Once again supermarket giant Asda is leading the way in passing on lower fuel costs to its customers.

As the above graphic demonstrates, it is even more admirable when you see the small percentage that a retailer actually makes from a litre of fuel. Their own profit has to come mainly from volume of sales rather than true markup.

Add the duty to the VAT, though, and it is easy to work out why the government are in no hurry to help us all when we are such a cash cow standing in their field of financial black holes.

Despite the idealistic views of certain political parties, fuel is a necessary and unavoidable part of everyday life for most of us. Not everyone has the benefit of good public transport and those of us who live outside of the cities have no choice other than to drive to work.

True recovery will not come until the price of a litre becomes realistic once again!

Politicians Take Their Seats For 'The Blame Game'

With our new coalition government announcing June 22nd as the date for its emergency budget, the opposing players are taking their places at the table for ‘The Blame Game’.

First to throw a six and keen not to take any blame for the financial suffering we will all be subjected to, the Chief Secretary to the Treasury, David Laws, conveniently ‘let slip’ yesterday that he had been left a ‘note’ from his predecessor stating what most of us had long ago realised - there is no money left in the UK’s piggy bank. He also hinted there had been a desperate last minute spending spree, by outgoing Labour, with money they knew they did not have to spend.

Round one to the coalition but I am sure it will not be too long before Labour get their throw with the dice!

Lack Of Government And The Financial Plughole.

According to a respected economist on the BBC this morning, the amount our dying government is spending per day is £550m more than we are collecting in taxes etc. That means in the 4 days of dithering to decide who is going to lead the country after the election, we are a whopping £2bn further into the red.

If we don’t get an agreement soon, the only party left willing to make a deal will be the bailiff!


-