Feb 052012

Some might argue that with £200 billion spent on welfare each year (up in real terms from around £150 billion seven years ago) there is little need for a voluntary sector. However, the government gives over £11 billion pounds each year to the voluntary sector. This sector grew enormously under the last government and is largely staffed by Guardian reading labour voters who use tax payer money to campaign against government policy. Isn’t the voluntary sector supposed to rely on donations? Some “charities” get over 90% of their funds from the state. Doesn’t that make them part of the public sector?

Many of them have been campaigning vigorously against the proposed cap of £26,000 in benefits – a cap that is wholeheartedly supported across the country and which many people think should be lower. Maybe it’s self-interest. If you reduce the numbers of people reliant on handouts then you are reducing their clients. One piece of information shows how far some have lost their way from their original noble intentions. At some point the definition of homelessness has been changed to include families where children have to share a bedroom. Why? This is common in many homes. Including it undermines the cause for real homelessness –  a horrible, miserable experience – that should rightly be prevented. This real homelessness has declined in recent years but far from charities congratulating themselves on doing a good job and winding down their operations they have continued to grow by expanding their remit to include as many people as possible.

It’s time to remove tax-payer funding from this sector.  The money saved can be given in tax cuts, giving the public some extra change to donate to those groups who truly do a worthwhile job.

Nov 212011

One hopes that the government’s announcement today that it intends to take on the risk of lending money to first time buyers is just a PR stunt designed to make it look like it is “doing something”. It is too depressing to think they might believe such as action will be helpful to the housing market.  The last thing first time buyers need is the government trying to prop up house prices by relaxing credit again. House prices will come down eventually and anyone who borrows excessively to buy through this scheme could easily end up trapped in negative equity or passing the cost onto the taxpayer.  

Equally annoying was the government’s announcement to bung property developers £400 million to subsidise 16,000 new homes.  16,000 new homes is a drop in the ocean and will make no impact.  Immigration alone requires around 75,000 new homes year and more are required by our aging population. But in case the government has forgotten it has a debt to cut. This year it is spending about £700 billion, nearly 50% of the UK’s total GDP. Despite the constant cry of cuts from every special interest group that grew fat from the largesse (at our expense) of the previous government, spending is no lower than last year. The cuts are a myth. 

Rather than burning money on the few that manage to get their mortgage underwritten by the government or one of the 16,000 subsidised homes the government should cut spending, cut taxes and give everyone a boost.

Oct 212011

What TV advert do you find most annoying ? Maybe it’s one for those comparison websites or one selling beauty products to the gullable? Me? I hate the Halifax advert so much I shout at the TV if it comes on. In case your lives are too exciting to be spent in front of the box let me inform you that it consists of a group of Halifax employees singing a cover of “I’ll be there for you” – the Jackson Five song.   Thanks for that Halifax, although I’m not sure by being there for us the original composers meant giving us an interest rate on our saving well below the rate of inflation and charging us a small fortune if we go a moment overdrawn.

In fact, it is the taxpayer that is there for them as the reluctant contributor of an additional £75 billion to help keep the markets and thus the banks afloat on the “never never” for a few more months.  How Halifax actually feels about us is perhaps more accurately reflected in a story that made the papers yesterday where a man was sent an offer of a credit card account, addressed  in error, to a Mr F**k Off.

Sep 192011

On Maslow’s hierarchy of needs shelter comes right down at the base. It is essential to us.  However where is the politician celebrating when houses become cheaper for us?

Instead the media and politicians seem to celebrate house price rises.

If I believed in conspiracy theories I would suggest it’s the perfect way to trap people in the economic system. You have to work hard all your life for the man to save up for and then pay off a mortgage. No optioning out of the system for you, peasant!

However the reality is probably a little more prosaic. Politicians and the newspaper editors tend to be of the age where they own houses and until recently felt richer as their prices rose.  And they weren’t the only ones.  Between about 1995 and 2007 home owners have experienced huge increases in the value of their assets. Some of them took out equity against the property and splashed the cash.

I’m sure Labour only managed get elected a 3rd time in 2005 because the borrowed money fuelled boom allowed people to ignore their generally unpopular social objectives.  Now however it’s a different story. Those of us in London, who still rent or those struggling to pay a huge mortgage taken out late in the boom, are entitled to feel a little aggrieved as we commute in on crowded  trains from distant suburbs through districts whose residents live on our money but where we can’t afford to live.

The amount available in housing benefit allows people who don’t work to live in properties way beyond that available to the average worker.  The coalition has introduced modest reforms – a limit of £400 a week which doesn’t even apply for current claimants.

It’s indicative of the Left’s warped view of the world that they vehemently opposed this measure.

Apparently it would leave the centre of London only for the rich. Well, no one seemed concerned that the middle classes have been driven out of the capital for years.  Housing benefit is the largest single benefit available and has contributed to a huge rise in social payments that the government spends our money on.

If the government wants to make housing more affordable it should do so. Build more homes, maybe regulate how much you can borrow or even reduce demand (immigration). Housing should be seen as your home rather than an investment vehicle. However while housing remains expensive those that work should not pay to house those that don’t in places neither can afford.  It’s an issue of fairness.

Sep 102011

There has been a lot of talk this week of cutting the 50p tax band. That’s not surprising – the people who pay it are almost by definition the most influential and so can make sure their views are heard.

How valid the tax rate is depends on your view point and all the sums being calculated to show it will lose more money than it makes miss its purpose. Its purpose was purely political – to appease Labour supporters and others – if times are tough it’s a nice bit of schadenfreude if the rich are getting it in the neck too – and to lay a trap for the Tories.

Cut the 50p rate and the cry will be “same old Tories, only care about the rich”. The Tories though are not complete idiots. If they cut the rate it will surely be part of a package of measures that benefit everyone. Raising the threshold at which tax is paid would be one. Applying the tax-free threshold to everyone would be another. They could even, gasp, raise the 40% tax band in line with inflation rather than letting it catch more and more people as it stays fixed.

Let’s see someone try and make political capital attacking measures that benefit almost everyone. After all if scrapping the 50p rate makes sense because it encourages spending, stimulates growth and creates employment then this logic must apply to everyone who pay taxes.