Wednesday, 16 April 2014

Manjoo go home

A UN bigwig called Rashida Manjoo has come to the UK and started mouthing off about how we are all terribly sexist.

Manjoo: See no evil (at home)
Maybe we have room for improvement, but why is Manjoo here? She's from South Africa, a prof at Cape Town University.

Let's remind ourselves of some numbers. The reported rape rate in the UK is 23 per 100,000 people per year. In South Africa it's more than 123 per 100,000 people per year! South Africa is the rape capital of the world and this woman has the cheek to come here and lecture us.

She needs to get home and sort out her own country.

Tuesday, 15 April 2014

Inflation is down

Good news, CPI inflation has fallen in March to 1.6%, down from 1.7% in February. This is well below the BoE's target of 2%.

Bad news, RPI inflation was 2.5% in March, admittedly down from 2.7% in February.

Other news, HPI (house price inflation) was 9.1% in March, up from 6.8% in February.

However since HPI is not a component of CPI it does not make the figures the government relies on look bad.

We will see the wages growth number tomorrow and plenty of people think that it will actually be higher than CPI, which would mean real wages are finally rising, which is a real prerequisite for the economy to grow.

Of course we still have our record national debt, our record personal debt, our record balance of trade deficit, our record low savings ratio and our record low base rates. But we shouldn't let all that detract from the good news.

Also, the only reason inflation is down is because sterling has gone up and made our imports cheaper.

Friday, 11 April 2014

Nigel Evans acquitted

When allegations first surfaced about Nigel Evans, MP, Deputy Speaker of the Commons, even this blog expressed doubt that there was any substance to the suggestion of homosexual rape times two. When it went to trial this blog was amazed.

Now of course he has been acquitted on all counts.

During the trial, of the seven "victims", three claimed no crime had taken place and one even sent supportive messages to Mr Evans. One called him an "all round good egg."

The CPS seem to have gone mad on this case. Early on they obviously realised they had a weak case. They went for a trawl through the history books, dragging up incidents that happened ten years ago, trying to make up in evidential quantity what they lacked in quality.

The prosecution was led by senior treasury counsel. There are only about eight of these QCs and they are normally reserved for murder and terrorism cases. Mr Evans was put to considerable personal expense assembling a legal team anywhere near as high-powered as the CPS had. A massive number of police officers were also assigned to the case.

It is not obvious why the CPS were so determined to nail Mr Evans; possibly simple homophobia. But it is clear there needs to be a root and branch reform of the service so this sort thing can never happen again.

Wednesday, 9 April 2014

Maria Miller resigns tactically

Culture Secretary Maria Miller resigned her cabinet position this morning. The media has been gunning for Miller since her perfunctory 32 second apology to parliament for fiddling expenses last Thursday was deemed inadequate.

Miller toughed it out for most of a week. And yet today she resigns and gets a nice letter from the Prime Minister suggesting she will be back in the cabinet before long.

Can it be that the timing of her resignation was chosen to wrong-foot Miliband at PMQs? Miliband must have been preparing broadsides for the PM for days now, and then with a couple of hours to go before PMQs his fox is shot and he has nothing to gripe about.

That's politics for you.

Thursday, 3 April 2014

Operation Trojan Horse

Birmingham City council seems to have come into possession of a blueprint used by Salafi muslims to take over an area.

Schools with a substantial muslim attendance are targeted. They first get people onto the school board then start a campaign against the Head Teacher, for example anonymously suggesting he or she is encouraging cheating. The Head Teacher is investigated, school exam results are cancelled. Outside bodies get involved and investigations start. In due course the HT is exonerated, but by then a new rumour has been started -  the HT is teaching muslim children Christian prayers. More investigations. Eventually he or she can take it no more and retires or moves to a school in a different area.

Now there is vacancy at the top. The board must meet to select a replacement. But wait, hard line muslims have already packed the board. The new man is not properly qualified; he cannot speak English properly, but he is a Salafi muslim. Henceforce all recruits to the school will be muslims. The school's multi-million pound tax-payer-provided budget is now at the disposal of extremist muslims.

It seems in Birmingham twelve schools have fallen to Islam in this way and the documents obtained by the council suggest moving on to Bradford and Manchester. 

The Cameron dilemma

This is the Cameron Dilemma: an employee is put on a zero-hours contract. Should he stay in the job and starve, or quit the job and then be unable to get benefits because he left a job voluntarily?

Thursday, 20 March 2014

Budget 2014

Yesterday (19-Mar-1014) George Osborne presented his second last budget of this parliament; the last one that will actually have much effect on the country before the next general election in May 2015.

In it he outlined plans to spend £732bn in the coming year compared to £720bn last year, of which he proposes to borrow £84bn compared with £108bn last year. So he is growing spending at about 1.7% compared to CPI inflation of 1.9% - thus this is a slightly deflationary budget, but he has held a lot of public pay rises down at 1% which will account for most of the hardship.

For the record the spending is as follows:

Department             2013/14     2014/15    Change

Benefits/pensions      £220 bn     £222 bn    +0.9%
NHS                    £137 bn     £140 bn    +2.2%
Education              £ 97 bn     £ 98 bn    +0.1%
Other                  £ 53 bn     £ 53 bn     0.0%
Debt interest          £ 51 bn     £ 53 bn    +3.9%
Defence                £ 40 bn     £ 38 bn    -5.0%
Police/justice         £ 31 bn     £ 32 bn    +0.3%
Social services        £ 31 bn     £ 31 bn     0.0%
Housing/environment    £ 23 bn     £ 25 bn    +8.7%
Transport              £ 21 bn     £ 23 bn    +9.5%
Industry/agriculture   £ 16 bn     £ 17 bn    +6.3%

The item that stands out is defence which has actually gone down in real terms. This is the saving from pulling out of Afghanistan.

The big winners are transport (HST2) and housing (a new city is to be built, called Ebbsfleet.)

It should not pass unremarked that debt interest payments are now (joint with "other") the 4th largest spending item.

The chancellor was able to report some fairly good economic news: GDP is ahead of forecast, and there are new forecasts for the years to come which are all ahead of previous forecasts. Borrowing is down and forecast to be lower than previously forecast. The new expectation is that the UK will stop borrowing and increasing its national debt in 2019/20, ie the end of the next parliament and only five years after Osborne's original forecast in 2010. But of course this is only a forecast - and all previous forecasts have been wrong.

George then took time out to inform us that a new pound coin is coming in 2017. This one will be twelve-sided and bi-metallic to fox those pesky forgers who have apparently replaced 1 in 30 of the pound coins in circulation with fakes.

There is a little subtlety to this. The original £1 coin was surprisingly similar in size and shape to the one euro coin and pretty clearly was gearing the UK up for entry into EMU. The new coin is a complete divergence so it seems Whitehall has decided the UK is never going into the euro.

There have been some objections to the coin having 12 sides because having an even number of sides (and not even rounded sides) makes it more likely to get stuck in slots. The 50p and 20p both have seven sides to avoid this problem.

It's a pound, but not as we know it.

The chancellor then promised us there would be no pre-election give-aways in this budget, before proceeding to announce the pre-election give-aways.

Fuel duty frozen; cider duty frozen; 1p off a pint of beer; spirits duty frozen; air passenger duty reduced for long haul (and private jets taxed for the first time!) Help-to-buy extended to 2020 and a shed load of cash handed over to various causes including a few million to mend potholes.

Corporation tax was reduced to 21%, with a view to getting it down to 20% next year. All electricity bills to be cut by a reduction on carbon tax. Bingo duty halved. (I didn't even realise there was a tax on bingo!)

The income tax allowance was raised to £10,500 and the 40% threshold raised slightly. Supposedly everyone earning less than £100K will see an increase in their take-home pay in April.

There was a slew of measures on the savings front. Cash and equity ISAs are to be merged into New ISAs. (George missed the obvious PR coup of calling them NISAs!) The contribution allowance is raised to £15,000 per year, but starting on 1st July for some reason.

The ISA changes are going to give the savings industry a few headaches. The merging of the types means that the great mass of people who only started a cash ISA now also have an equity ISA. ISAs have morphed into the old Personal Equity Plan - PEPs - introduced under Thatcher and cancelled by Blair.

Unfortunately the ISA rates have crashed recently. You'll be lucky to beat 2%.

The amount you can put into premium bonds has gone up from £30K to £40K and the number of millionaires "created" per month is increasing from 2 to 4. "Milly", who visits each new millionaire personally to tell them, and applies CPR if needed, has had her work load doubled. (I'm not quite sure why the million pound cheque needs to be delivered by a medically trained person but you can win a hundred million on the Eurolotto and you have to phone them.)

There are some new "pensioner bonds" which pay 4% - the limits are low, no-one will be making much here.

There are also big changes in person pensions. The requirement to buy an annuity is completely removed; which is excellent because annuities are terrible value for money at the moment. Recently retired people must be gritting their teeth that they have had to hand over their pension "pots" and now no-one has to. We may even see a movement started to get them their money back.

There were some other changes to private pensions which could in the long term be quite significant. Basically from the age of 55 you can withdraw cash from your pension at your marginal rate of taxation, previously you paid 55% if you wanted your money back in cash form. (There were allowances for small amounts though.) This is complex. Details here. It could be that some interesting tax dodges will become possible. The ramifications of the pension changes will not be apparent for some time to come.

The chancellor also mooted a couple of other big ideas. He wants a cap on welfare spending. He wants it limited to inflation so that the welfare budget cannot run out of control in the future. He also wants some sort of limit on government borrowing. These proposals are not fleshed out at the moment, but we could be seeing the birth of an American style "debt ceiling".

Locking in fiscal prudence is a good idea. In the past we have generally seen the Tories being careful with the money then Labour coming into power and spending like mad until the coffers are empty and the Tories are re-elected to fill them again. Breaking this cycle would be a boon to the country.

Milliband responded for the opposition (for some reason he responds to the budget but Balls responds to the Autumn Statement.) He made the good and valid point that despite all the good economic news people's living standards have been continually falling during this government's period in office. He winged again about the millionaire tax rate being reduced from 50% to 45% but since it was 40% when he was in government, and he never even taxed private jets, this point is starting to fall flat.