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The Welfare covenant is broken and Universal Credit is not the answer when it already creates victims

October 12, 2018 Leave a comment

Basic Standard of Living Q

It is regrettably all too easy for some to overlook the realities of life for others when  everything is going well and there is no need to look to anyone else for help.

Sadly, this is not the case for many. At one time or another during our lifetimes, there is every chance that we will need a safety net in place for when plans don’t work out quite as we thought they might, and we find ourselves in need of money, food, clothing, transport, warmth and maybe even a home.

State provision of such a safety net within a civilised society is not only right. It is also necessary when government is convened, managed and operated with the greater good, benefits and consequences for all are firmly in mind.

However, our Welfare and Benefits system has and is being continually abused.

It is being misused by those seeking help. But it is also being mis-purposed by those who have been given the responsibility in Government for providing that help on behalf of us all.

The Welfare covenant between those helping and those seeking help has been broken. And for the benefits system to work beneficially again for all, there must now be a new way of thinking.

No form of Government provision can truly be beneficial to all if victims have been created of any kind.

Universal Credit has therefore proven itself flawed before it has even began operating fully.

With many struggling recipients identified already, we should all be asking questions about the many more who are yet to come and the consequences that will surely follow.

This doesn’t mean that the system we have had until now is good. That it is working. Or that we should just stay tied to the same old thing.

We shouldn’t, because the current DWP Benefits regime really isn’t working for anybody, and we are all in desperate need of a solution which really can be seen and experienced as a ‘win-win’.

Now before we get lost completely with how Politicians are getting Benefits and Welfare wrong, there must also be an acceptance on the part of us all of what it is fair to expect to receive, how we receive it, and under what circumstances that help will actually come from the State if we should ever find ourselves in the position where we genuinely need it.

As we look at what is really wrong with the system as it is, we must also understand and accept that if the Law allows certain types of behaviours to exist, it is inevitable that there will be people who will employ them.

It doesn’t make their behaviour right. Their actions are not inevitable. Everyone has free will and can choose how to behave, even when a rule covering that action or behaviour may appear to be absent.

If the system doesn’t accommodate for the misuse of Beneficiaries and those affected, it is the people who are responsible for its design and implementation who are equally responsible for identifying what is wrong, putting it right and ensuring that either good or bad, nobody who should be receiving help gets missed or is able to slip in between.

Why the benefits system isn’t working, isn’t simply about something structural, the technology used or the people who administer or receive Benefits of any kind.

Like most policy failures today, it is a combination of factors which are not being considered. Many of them overlooked for the cause of political expediency, or because their place and influences sit outside of the specific or central theme – in this case the Benefits regime.

The real cost of a Basic Standard of Living is not understood by Government

The greatest injustice visited upon the unemployed, is the Government and DWP assertion that in 2018, one person can live on a basic income of £73.10 per week.

They can’t.

And when the Government itself has set the Minimum Wage at £7.83 per hour, which at a 40 hour week would be the same as £313.20, who exactly do they think is going to step in and replace what for some will be the destitution-busting £240.10 per week which sits so ominously in between?

Yes, there are many other Benefits other than and beyond the scope of Jobseekers Allowance.

But Universal Credit is being sold as a method of simplification by rolling everything into one, when the true aim of saving money will not stop a similar way of allocating money to the very same things from then existing, just under the umbrella of being just one application.

Government must provide a Basic Standard of Living income to those who qualify and need it.

If it is too expensive to do so, those in Government would do well by beginning to ask themselves the question ‘why?’

Government has surrendered responsibility for setting the prices of goods and services essential to a Basic Standard of Living to the private sector

Sadly, little attention is paid to the elephant in the Benefits room. That being the escalating prices of goods and services which provide for everyone’s basic needs in life.

That’s food, clothing, accommodation, transport and utilities.

Not First Class or on the upper side of ‘Taste the Difference’.

Just the stuff that anyone would need to be kept fed, clothed, warm, able to get themselves to a job and home again, and knowing that at night they will have a roof over their head.

Control of all of these goods and services is now completely under the infuence of commercial interests which have money as their one and only god.

Free Marketeers and Neo-Liberals will tell you that the Markets will look after everything when they are completely free to do as they choose. They don’t, they won’t and they will continue to do everything to make profit from every opportunity, for as long as they are gifted with the freedom to choose by gutless Government. Government filled with Politicians who see ethical intervention in the Markets and Financial Sector as a problem because they believe that they have too much to lose by doing so.

No service which is essential to the public good should be placed in private hands or under the undue influence of any self-serving cause.

No food supply essential to basic, healthy survival should be subject to the whimsy of the Markets where multiple traders, agents and handlers are seeking to add one profit margin on top of another, just on one item supplied within any one producer-to-plate supply chain alone.

If the Government genuinely wants the Benefits system to work, it has to find an effective way of controlling these two essential areas of daily life so that once a system that does work has been identified and implemented, it is then not rendered useless by private interest, based on nothing but profit.

We are culturally conditioned to assume that all Benefits Claimants are in some way bad

Mud sticks, as anyone who spends any time on social media or reading the news will know.

But the phenomenon of people assuming the worst of others based on the first story they are told is nothing new. And when it comes to the unemployed, being work shy is basically the accepted view.

The truth is not as straightforward and anyone at any stage of their career can find themselves out of work and having to ‘sign on’ in order to get help.

The problem with the ‘accepted truth’, is that the system itself, both mechanically and culturally treats everyone who comes through the Jobcentre door as if they don’t want to work, cannot be trusted in any way and that they all fit into the same mould as each other.

This approach overlooks the fact that people find themselves knocking on the door of the Jobcentre and the administrative centres of the DWP for very different reasons.

Some are poorly educated. Others have grown up in conditions that reinforce a world view that this is all they are worth. But there are others too who have landed themselves with significant debt to gain degrees that have proven to be of no use. People suffering illness and mental health problems which restrict the work that they can do. And even highly experienced and very well-educated professionals who cannot provide anything like as simple an explanation for what life has put them through.

Sit in a Jobcentre for long enough and you will hear claimants complain about having to wait for the money they are entitled to. You will see others lose their rag because they have not conformed to the regulations that they are supposed to. You will also witness the presence of so many security guards, it clearly suggests that behaviour of this kind is not only possible, but actually the expected constantly and all of the time.

But not all Benefits Claimants are a burden. Many want to work. But they are branded as ‘no-hopers’, instead of gaining the help and support which reflects them individually.

It is little wonder that those outside of the expereince of having a ‘down period’ in their lives take what they have for granted. Then look on and see all these people as being worthless and occupants of society’s bin.

Taking this approach is little more than deliberately setting up Benefit Claimants to fail.

It is not the action of a Government which respects and fully fulfils its role as the representative body of a civilised society. Nor is it illustrative of a Civil Service which is fully considerate of its role.

We can hardly expect the general population to think differently when the system so demeans.

A significant element of Claimants consider themselves entitled to what they receive

Because the system has been so poorly thought through and has not evolved positively in a way that sees its role strategically and as a way to raise expectation from the ground level upwards, it encourages the belief that it can be used as a substitute for real life. For not taking part. For resenting the success of others and as such seeing Benefits as an entitlement or a worthy redistribution of wealth from others.

The Benefits system only works for those who surrender themselves completely to it, leaving no incentive to escape and provide us all with that so far mythical ‘win-win’

Because the Benefits system has been so poorly thought through and has not evolved positively in a way that sees its role strategically as a way to raise expectation from the ground level upwards, it encourages the belief that it can be used as a substitute for real life. For not taking part. For resenting the success of others and as such seeing Benefits as an entitlement or a worthy redistribution of wealth from others.

The Benefits system only works for those who surrender themselves completely to it. It  leaves no incentive for Beneficiaries to escape and benefit anyone but themselves.

With restrictions placed upon how many hours a Claimant can work without losing Benefits, and the process of reinstatement being long and arduous – even before Universal Credit begins, there is zero in terms of incentive for people to take on more hours and work towards self-sufficiency.

Because the 6 Benefits together are so very complicated for one person to qualify for already, the further any Claimant journeys into this portfolio of direct and indirect income streams the less and less likely they are then to leave.

We can only ask ourselves the question if we were to find ourselves in the very same position. When everything is taken care of already, what serious advantage is there to be gained by going out and working for a wage which might never come to anything near the total that becoming subservient to the system and therefore being a Benefits slave can achieve?

Again, we cannot blame people for responding this way when the system itself not only allows but facilitates behaviour of this kind.

Help should always be given to those that need it.

For those who currently choose to be beholden to the system, there must be a process of incentives which doesn’t leave them without all the basic essentials.

It must also encourage them and accept and appreciate that they have responsibility for themselves as well as the wider community. A community which is ready to help, but is itself entitled to see those who voluntarily choose a life on Benefits as a drain on resources that we desperately need focused to provide other Public Services and that they are as such disadvantaging others on little more than a whim.

As taxpayers, we are effectively subsidising the employers of low paid workers by providing the in work benefits which allow them to survive

I have already mentioned what it costs to live and the need for a basic standard of living above.

Yet the conversation and discussion needs to go even further than the power of commercial interests over the essential goods and services for life.

The debate and the action that follows also needs to recognise the role which our Government is playing in keeping wages low and propagating a system where profit margins for large companies are exploding, whilst the millions of people on low incomes are now being farmed for the debt they have to carry, just to survive.

The money that lower income workers receive is in many cases too much to allow them to be on additional Benefits, yet not enough to allow them to be self sufficient. It keeps them ‘functioning’ at the behest of others, somewhere within the ‘in between’.

If we could freeze the prices of goods and services right now, so that they no longer rise, and we could focus in on what it actually costs a normal person on their own to live, self sufficiently, to feed, clothe and take care of themselves, put something by, have a holiday, a realistic pension and have a life which reason would tell us would make a normal person happy, we can soon begin to see the disparity between where wages sit and where right now, in these ‘static’ circumstances they would need to be.

At £10.20 per hour in London and £8.75 per hour outside, without the help of Government with Housing Benefit and Tax Credits too, even the Living Wage Foundations advisory level for a basic income doesn’t come close to what self sufficiency – that’s what complete independence from Government support –  would actually require.

Such a reality where Government support for the growth of small business is concerned alone would probably make the whole thing more palatable.

But the real beneficiaries of this State-sponsored in-work poverty are the big Companies making significant levels of profit that would in reality only dip slightly if they were to pay wages to front-line staff which would allow those employees to function within the overpriced society which their Employers have helped to create.

That this situation has been allowed to exist is beyond questionable.

That successive Governments of all kinds have allowed a situation to exist where the Taxpayer is paying over the odds for products in services in their face value alone is simply wrong.

That customers are then paying again to subsidise the wages of the staff serving them would be funny, if its implications and the reality which surrounds it not so very serious indeed.

This whole process has only been possible because Government has either borrowed incredible amounts of money, or has cut other and arguably more essential Public Services in order to allow them to provide this massive giveaway. A free-for-all that has broken the Country financially and is one of the key reasons why unfettered immigration of low skilled workers from Europe has been possible. Itself an issue which is seen by many Remainers as key to the majority vote for the UK to leave the European Union and the one which they are still obsessively attempting to resolve.

There would be some sweet irony in this if this financial mismanagement had really been helping people and UK communities, rather than being overtly beneficial to commercial interests, private profit and yes, the EU all along.

But there hasn’t, and in terms of management of expectation, this and previous Governments would appear to have hamstrung any future Government which wants to take a stand and do the right thing.

Be that as it may. Doing the right thing, is the only way that all of this is going to end up working right for everyone involved.

The solution

Like almost everything that Government and Politics touches, the key to delivering change in the Benefits and Welfare system is thinking differently.

And it’s the thinking and ideas at the top of British Politics which needs to change first before it can change anywhere else.

The responsibility of Government

Before the Benefits problem can be fixed, the understanding of what the problem actually is, must be broadened to include the wide range of factors which feed and influence the issues which those claiming Benefits experience.

Right now, there is an obsession on the part of decision makers. One which leads them only to attempt to address the effects of any problem, rather than to tackle each and every one of the causes.

Until all of the causes of problems are addressed, the Benefits system will only ever work temporarily at best, until those factors which are outside of the scope of that consideration inevitably change and then exert their negative influence once again.

A Basic Standard of Living level or the real Living Wage will only be achieved and maintained when all contributing factors fall within the reasoned influence of non-idealistic Government that considers the consequences of policy making upon ALL.

Politicians simply do not understand the power they have to change things. They do not see the scope of their roles and they have no appreciation of the influence that they could really have if they were to put the interests of ALL the people who have elected them first, rather than themselves, their Political Parties and whatever ideas or interests sit around that self-serving mix.

It will not matter how simple or complicated existing of new systems like Universal Credit might be. If they fail to consider and be considered as part of the bigger picture, they will always fail – and our Politicians have both the ability and responsibility to ensure that this is no longer the case.

It is their choice to now decide and it is their choice which must come first.

The responsibility – and acceptance of Claimants and Beneficiaries

For any solution to gain traction, it is also vital that ‘being down in your luck’ is accepted as a normal part of life, rather than being a condition which renders any of us as being sub-standard to it – the position under which Benefit Claimants are often perceived.

Those claiming Benefits fall into two predominant groups. Those who are or should be  temporary claimants and are able and willing to work. And those who are longer-term or permanent claimants who are unable or unlikely to be able to consider working again because of disability, illness, or other genuine debilitating circumstances.

All of us as beneficiaries must accept that there is and never has been a magic money tree of any kind. That the support that is given can only be provided through the act of others contributing through taxation on earnings, whether they themselves earn little or some extraordinary figure that might blow our minds.

Whilst it may currently behave as if it is, and some Politicians continue to seek election on the basis of perpetuating this myth, Government and the Public Sector is not a separate and ‘benevolent’ entity which doles out cash to Welfare recipients on the basis of being kind.

Government exists to represent the best interests of ALL British people. Government is there to help us all to succeed in whatever way that might be possible for us as individuals. And on  behalf of us all, it is there to help and provide support to those of us who cannot do so, in such ways that we may never feel like an after thought or something that others have in some way been left behind.

Government is the formal community power which represents and is therefore ‘for all of us’.

Those of us receiving help should therefore be mindful that the help we receive comes from the people next door, up the street and across our Cities and Towns.

As recipients, we are not ‘entitled’ to anything. It is simply that looking after those in genuine need is the basis upon which our civilised society can be found.

 

 

 

 

 

Festive Strikes defy sense and reason, but we should all be mindful of the unspoken issues behind them which serve as a warning for us all

December 14, 2016 1 comment

download-1We should all recognise the value that Unions historically had in influencing positive change in the workplace. But times change and the question over whether they have continued to provide a genuine voice for poor treatment or have simply become little more than an archaic nuisance to business and government alike will certainly lend legitimacy to the arguments against Union power by the more neoliberal within them.

The effect and reach of equalities legislation has permeated through every part of society and our lives to a point which has arguably gone well beyond its point of good, and to a level where its influence has become fundamentally regressive.

From this standpoint alone, you could make a reasoned and valuable argument against any organisation or movement which seeks to progress the work of the rights lobby further, and beyond that see the power of Union Leaders as the menacing anti-business device that the untimely raft of strikes by Southern Rail, Post Office and Argos Staff this December would ultimately suggest that they are.

It is certainly true that in relative terms, there is no difference between bankers creating profit-focused financial devices that speculate the cost of products or services, indirectly raising the cost of living for us all, and a self-serving union rep who places a stranglehold strike on an employer simply to get a pay rise or a perceived improvement in terms for their fellow staff.

But should we really dismiss any kind of industrial action by narrowing cases down and concluding that personal gain is simply what its all about?

On the face of it, it really doesn’t matter if a debate is framed as a matter of health and safety or fairness over holiday conditions and pay. Gain does play a significant part, but so does the fear of loss, and both these two debates are representative of much deeper seated root causes of problems at work around us which are building up as a significant time bomb, whilst they continue to go unchecked.

Union leaders do not help themselves by behaving as if business exists only to create and facilitate jobs. It doesn’t and never has. Yet the drive to pay less for the same work to be done or to do away with specific jobs entirely in order to cut costs when profits are maintained and prices are soaring, rather gives the lie to where a public service provider’s priorities focus. The more concerning element of the Southern Rail strike debate however, is what the introduction of technology which immediately halves the staffing requirement for managing just one train alone will mean or may have already meant when considered outside of this specific context and becomes representative of the impact its is having in every area of business and employment.

Immigration is blamed by many for the loss, or rather diversion of jobs to foreign and particularly Eastern European workers, with the caricature of the Bombay-based call centre worker being used to account for the export of many others. The inference being that jobs are in some way set in stone and that it is just the terms under which they are awarded to an employee or contractor that changes.

What it doesn’t account for is the genuine loss of jobs due to technological advances having literally removed the need for a particular role to exist.

We would perhaps like to think that his march of technology is researched, developed and delivered purely on the basis of improving many different aspects of production and service delivery. That is certainly how the benefits are sold.

What is rarely mentioned – the elephant in the room, is that jobs have been disappearing for a very long time as a result of this pathway of progress, whether it has been within manufacturing, agriculture, public transport or any one of a multitude of industries and skilled areas where services or production have been highly labour intensive.

Up until now, the change has not been noticed. Workers have retrained and like the once redundant miners who moved into call centres in the North, many manual jobs have been replaced by others within newly defined service industries which are focused on producing an experience, rather than some kind of definable or tangible product we can buy.

It sounds good, and little is said when jobs are there for those with apparently transferable skills when a factory closes. But what happens when the new jobs do themselves become the target of efficiencies and the technological breakthroughs which leave a machine doing the job of many different people over its amortised lifetime at a fraction of the cost?

This whole idea will to some sound far-fetched. But the change is very real and is now becoming present as a very clear danger to a broad spectrum of jobs.

Take for instance Amazon Go, which is set to be launched in the United States early in 2017. This forward looking and innovative Company is not standing still when it comes to the platforms from which it seeks to acquire new market share. Within weeks, it will move into location-based grocery stores which do not require shoppers to use tills or a check-out system when they visit. You simply use the smartphone based Amazon Go App which does the work for you and the system even knows and calculates the change when you put an item back.

We need only consider the number of tills at a standard sized Asda, Morrisons, Tesco or Sainsburys near to where we live and the inevitable irritation that queuing to pay causes us all to appreciate just how quickly this new way of shopping could explode, taking many jobs from any one or all of these stores as the concept is rolled out and goes viral throughout the retail industry – which it inevitably will.

In business terms, this development by Amazon can only be commended as the groundbreaking step that it actually is. But the dark realities behind this very appealing change for our instore shopping habits is that its true benefit will be profit to shareholders. It will be masked by a transient benefit to us all as shoppers, but it will ultimately lead to the loss of jobs which may simply never be replaced or made available elsewhere.

The very difficult message that needs to be swallowed, fully considered and then acted upon by policy makers as a whole is that the story which underlies comparatively simple squabbles with the Unions over pay and conditions do indeed relate to the range of still unanswered questions over the continuing cost of living crisis, but are in fact just the tip of a very large iceberg indeed.

In recent weeks, highly respected British Scientist Professor Stephen Hawking and US Tesla CEO Elon Musk have both alluded to these issues with Mr Musk going as far as to suggest that government may have to consider providing a basic income. He is absolutely right.

If industry continues to deliver efficiencies via technology in the way it that it is already doing so, whilst religiously maintaining or increasing margins and raising prices despite the savings being made, profit for the few and the effect it has on the many will unquestionably result in the Government paying the bill to finance a significant workforce which has become unemployable and left without choice.

Less people paying tax will exacerbate the difficulties that the Government faces and families in genuine need will not be sustained on a level of income which doesn’t meet the increase in the cost to maintain a basic standard of living which is being dictated by and large, by the very companies who will benefit from the implementation of the technology that enables them to shed so many staff.

The alternative will be that Government must take the concept of responsible capitalism seriously and consider the steps that may need to be taken to prevent businesses growing to a point where their market share enables them to become a monopolistic menace to the very society that buys its goods or services.

In the mean time, the methods, approach and lack of consideration for the impact of their actions upon people who are struggling in the very same ways as union members are themselves in the run up to Christmas may well make any feelings of support for the Strikes feel somewhat unpalatable. But we may all nonetheless do well to appreciate the value in the story which is not being spoken by the Unions, the media and Government when for far from obvious reasons, the voice of militancy leads an employee to act.

 

image from source unknown

 

Labour’s coercive plan to fix the living wage is as real world as the Tories apparent belief that unemployment and poverty are the same thing….

March 16, 2015 1 comment

SNN0713XA---280_1419151aAt first glance, Ed Milliband’s promise to roll out a requirement for employers to pay the living wage sounds like it recognises the biggest issue facing so many families across the UK.

It could work. Or rather it could be seen to work temporarily, and that’s the most cynical part about it.

If our economy was on track, managed by politicians who considered the real impact of policy and performed as it could and arguably should, a working adult would be able to financially support them self on the most basic wage, without any need for support from the Government, or any third party organisation such as a food bank.

The political tomfoolery or short term opportunism which Labour are investing in their manifesto plans as part of their General Election Campaign doesn’t however recognise or consider the role that such policies play within the ecosystem that business and the economy around it actually is.

Like the Conservatives flawed idea that poverty evaporates the moment the unemployed are offered a job, fixing a basic wage for all gives absolutely no consideration for all the other factors that come in to play, nor the consequences which will almost immediately follow.

Whilst the suggestion of an apparent £1.50 an hour raise will give the lowest paid the feel-good factor that might win their vote, Labour’s sound-bite gives no thought for the fact that small businesses might have to reduce their workforce, just to pay the higher wages for fewer staff that the law would require.

This fag-packet plan gives no thought to the likelihood that the productivity of small companies could inevitably reduce because there would be less staff hours available to do the same amount of work.

It doesn’t consider the reality that profit margins may be so low for some small businesses that being required to pay the living wage to employees might actually force them out of business because they cant compete with bigger companies which have the economies of scale and significantly wider profit margins to help them out.

For big business, that might be seen as good news. Companies that thrive on the use of low-paid, low skilled workforces such as the supermarkets and branded coffee bar chains do after all have the ability to raise prices almost at will. They would certainly then be able to cover the rises that the living wage would require, as they inadvertently make the cost of living more expensive for the lowest paid workers, preserving the profitability of their business models.

Put in these terms, we can soon appreciate that the living wage as it is being presented by politicians is in fact just another one of those red herrings that they keep on spinning. It doesn’t accurately reflect what it costs to live. It certainly doesn’t reflect the manner in which the government continues to subsidise large company profits by providing the many welfare incentives for those on the lowest pay, such as tax credits and housing benefit – even if it keeps some small businesses afloat by doing so.

Many people would simply not be self-sufficient on Labour’s Living Wage, any more than they are on the Minimum now. Its coercive implementation would just begin a spiral of inflationary rises that would once again hurt the members of our society who need a basic level of income which genuinely reflects the cost of living the most.

In real terms, we would in effect very quickly be back exactly where we are again right now, with some politician promising yet another quick fix which isn’t actually going to ever solve the problem, just keep the wheels turning by moving the goalposts and them themselves in government (or knocking on the door of it) until another day.

We need the political establishment to begin taking the longer view. To consider the concept of cause and effect. To appreciate, recognise and work with the reality that all decisions they make, and that all policies they implement will have consequences that when made in isolation, often have the result of hurting the wrong people whilst benefiting those don’t actually need any kind of financial assistance at all.

Decision makers must become conscious of the fact that money may be the common thread which runs through almost all of the problems that we have in the UK, whilst money is not the problem in itself.

Westminster has to accept that fire hosing money into problems – and in this case, not even the government’s money – is not a solution. Unhinged spending only extends the magnitude of the problems that already exist, whilst increasing a mountain of debt that for any organisation other than the government would have long since have resulted in bankruptcy.

Whether it is wages, Welfare or the NHS, reform needs to take place on a wholesale basis and comprehensive scale; throughout and across the system of government and everything it touches or ultimately has responsibility for.

Real lives are not completely populated by one-off black and white decisions and even when they are, the ripple effect of consequences will go in all directions and often end up hitting completely different – and usually innocent things.

Above all, government must lead on the reassertion of ethical practices throughout business and government itself. This needs to travel from the top to the bottom of society and remove any suggestion of there being one rule for us; for you another.

The best place to begin would be for the Conservatives to stop behaving as if telling people they are no longer poor will make them believe otherwise when everything they are experiencing says not, and for Labour to stop pretending that barking an order will make a free-thinking business world sing happily without consequence to its nanny-state tune.

The real living wage – or point where the lowest paid can live self-sufficiently, can only come into being within an economic system which produces its own equilibrium.

Government must stop interfering where it shouldn’t, and do more where it should, preventing other forces from manipulating or skewing the balance which has already travelled so very far away from a point of being good.

Poverty, immigration, radicalisation, unemployment and many more serious issues which the UK is facing are all made worse and worse by the behaviour of short sighted and inconsiderate politicians. Its time that they all realised that life is not like a bedtime story book for those who live outside the Westminster bubble, and real life for real people doesn’t simply hinge on getting re-elected every five years.

image: http://www.thesun.co.uk

Bankrupt Britain: Is the death of Local Public Service provision avoidable and will it lead communities to provide their own not-for-profit services?

November 26, 2014 Leave a comment

Whilst it may not be generating the media frenzy or sensationalist prose that usually grabs everyone’s attention, recent days have seen a number of different stories emerge that confirm much about the state of Local Government and the services we contribute towards with our Council Tax.

The common theme is of course money – or rather the lack of it.

Those of us taking the collapse of local public services seriously may already be well aware of the perilous state of funding and how bleak the outlook actually is.

However, despite the many cuts and reductions in services that people have witnessed across the UK already, it is the continuing reliance that today’s politicians have placed in using yesterday’s methods to solve tomorrows problems should perhaps give us even greater cause for concern.

This week alone, one Police & Crime Commissioner covering a Conservative area has suggested that he will seek a referendum on raising the local Police Precept element of Council Tax by no less than 25%, whilst the Leader of Newcastle City Council is now on the record as suggesting that the reduction of funding may soon lead to social unrest, with an expectation that an incoming Labour Government will simply change the ‘settlement’ – and thereby solve the problem after May.

Whilst both of these Politicians are in unenviable positions, neither plan would work in the best interests of the electorate, even if they were to be seen to solve the problems in the immediate term. And by immediate term, we are probably talking just 12 months before the very same problem is there to be solved all over again.

Adding yet more to the Tax burden of individuals and households may be an easy decision for politicians, but isn’t sustainable for the people who are paying.

Meanwhile, more money coming from central Government when the Country is already effectively bankrupt spells disaster of another kind, as the accumulation of National Debt simply cannot continue with each successive Government that comes along attempting to shelve today’s problems for tomorrow by printing money like it was all some kind of game without any real cost.

The system of local public service delivery is broken not just because of a lack of funding today, but because of decades of mismanagement focused on targets, working conditions and the development of the protectionist culture which serves everyone’s interests but those of the very people who the services were initially created to serve.

These cultural and institutional problems have not been created locally, but they are certainly propagated locally.

One of the most serious ‘injustices’ served upon every Council Tax Payer, is the seismic amount of our contributions that actually go into the Local Government Pension Scheme. It has increasingly done so since the then Labour Chancellor Gordon Brown raided Pension Funds in 1997 and left the general public to pick up the tab for the subsequent deficit which would otherwise have surely obliterated gold-plated Local Government Pensions.

It would certainly be advisable to have a look at your Local Council’s Annual Budget and see just how much of your money goes into this Scheme. A good guess would be that rather than being anywhere near the red, your local services would be well and truly in the black if you weren’t funding someone else’s retirement plan, just because of the last Labour Government’s fiscal free-for-all, which removed many of the regulations that actually helped a great many of the very people who supported them.

Solving the problem of how to afford what local public services cost us without losing services, reducing services or there being a need to dispose of assets which basically belong to us all, may have already reached a stage where it will seem impossible to do so without the measures already discussed.

But with such options not being real choices, we will all soon have to accept that the way local public services are delivered is going to change; and that the change that comes may not be in anyway better.

Service sharing between Authorities and even Police Forces is now well under way and is likely to accelerate significantly as the reality of the UK’s financial predicament continues to bite hard.

However, the distinct irony of this pathway is that sharing services does indeed take the management and handling of public services further away from the people themselves. And the point should not be lost on anyone that the real cause of much of today’s political disquiet – i.e. taking decisions further away from people will only be made worse by what is yet to come as a result of this.

The political and government infrastructure that could have solved problems like those raised by the Scottish Independence question has already existed for at least two generations in the forms of Parish & Town Councils, District Level Councils and County Councils.

The problem is that Westminster based politicians do not want to empower local representatives at any cost.

Whilst continually paying lip service through concepts such as ‘Localism’ – which has been such a big sound bite of the Coalition era, the reality has been that all changes within Local Government have simply been pushing more and more power back to London, rather than devolving local decisions to local people as any Government focused upon what is really best for the electorate surely would.

This reality may well give the lie to the ‘vow’ which we all awoke to on the morning after the Scottish Referendum. It almost certainly paints a picture which doesn’t look good for us all locally. But when local politics is itself arguably just as rotten and as focused on itself as Westminster is, what can we really expect?

The reality of what lies ahead should hit us hard, because much of what we today take for granted in terms of services supporting both communities and individuals may soon be simply unaffordable – even though we seem to be paying through the nose for it.

With Government Organisations and structures maintained by a culture which nobody is willing to reform, Local Authorities are likely to lean ever more heavily in the future upon contractors and trading companies.

This is a considerable leap in the direction of privatisation and one which could very quickly lead to the token ability of Local Council’s to affect change and decision making on the part of the communities that they represent to be seen for what it really is.

It is a very real prospect that the only services that many people perceive as being what they receive for their money will be handled by private contractors. Companies who are delivering services to the public whilst making a profit at a lower price than what it would cost the public to deliver itself.

With even fortnightly bin collections now at risk, it is not in any way hard to imagine paying for your rubbish to be collected by a company you pay directly – as you would do with electricity, gas or your phone. Indeed it may be little accident that ‘utility’ companies already run such services on behalf of Councils and many of us will quickly wonder what we are paying Council Tax for if we don’t see any Police on the streets and have our rubbish collected by someone else.

Without immediate and meaningful reform, it is a good guess that social enterprise will be the only way that we will be able to have local public services delivered, which are seen to be free at point of delivery or kept at a cost which is both affordable for users and sustainable for the organisations delivering them.

This is unlikely to be restricted to just local service delivery, and whilst utilities, transport and communications are currently little more than the cash cows of the City and its Pension Funds, keeping it real dictates that sooner or later the political classes will have to accept that allowing our society to function at its most basic level requires nothing less than that all services provided for the benefit of the wider community and the individuals within it must be provided on a not-for-profit basis and with best value to the end user firmly in mind.

Regrettably, with much of the infrastructure already disposed of which will facilitate this at National Level, and the same process now progressively happening through the back door at local level, it is communities themselves that may well have to raise the funds to create the new trading companies that will do this.

With crowd funding a good example of the options now available, it is certainly possible to do so.

But as we also wonder why we are paying more tax on everything but receive even less for what we give…won’t we all be asking the question why?

 

image: dailymail.co.uk 

 

Annuities: Has another election winning time-bomb been lit that will devastate the futures of normal people just so a Political Party can get back into power?

March 23, 2014 Leave a comment

Annuity-sale_2367580b

Read the latest opinion polls and it is easy to conclude that George Osborne’s 2014 Budget has had the result that he was looking for.

With both next year’s General Election and perhaps more importantly, this year’s European Elections firmly affixed in his mind, it was certain that polices would materialise which were likely to incentivise voters in the short term and once again take attention away from what will happen as a result in the long.

However, the steps to remove an obligation to invest at least some of a pension pay-outs on annuities may take this quick fix and opiate-like vote winner into an entirely different league when it comes to rolling over the problems facing the current Government in to the difficulties which will almost certainly be faced by normal and everyday people in the future.

Pensions are a hateful topic for most people simply because the funds within them are untouchable. To struggling wage earners, reading an annual statement from their provider and seeing how funds can be growing at a healthy rate, can certainly be a torment. It often gives that siren-esque gremlin on their shoulder the perfect opportunity to preach a tale of how much better that sum of money would serve them if it were in their own hands right now.

As many already know, the realities of long-term money management requires a lifetime without financial challenges at best, not to mention the most exquisite forms of discipline at a very personal level . This is why pensions – and until this week annuities, have been safely kept out of reach. Temptation and therefore all the basic requirements and influences that come with living a life today are or have been safely kept at bay, without any of those threats being responsible for the potential hells that may without them come from many of our own tomorrows.

Removing the obligation upon retirees to ‘buy’ an annuity will naturally – and very understandably – be perceived as a massive gain for many. The caricatures of OAPS in Ferraris may in practice turn out to be anything but unreal once the Policy comes into effect.

But when people have experienced a lifetime of financial prudence and responsibility, exchanging this and the future they have banked on for what is arguably little more than a lottery win situation could turn out to be very costly indeed.

Windfalls are by their very nature difficult for almost everyone to deal with in a reasoned way because they are naturally habit-breaking in the extreme. Having large ‘disposable’ sums of cash suddenly available can seriously skew a person’s view of the world on what might actually be a very temporary basis indeed and a study of the effects of sizable cash wins on real-world people may have served the people behind this plan very well.

This really doesn’t seem like a policy which has the best interests of the retirees in mind and especially so when you consider the state of the Country’s finances and the most recent comments suggesting that the State Retirement Age with have moved to 70 by the year 2040. Hardly comforting news if you have no annuity to top up an insufficient State Pension and therefore are left with the glaring possibility that you will have to continue working until you literally drop.

With life expectancy rates going up all the time, what sort of desperate circumstances are people reaching pensionable age from next year now going to have to face, long after the Coalition Government knows the result of the 2015 General Election or Mr Osborne’s tenure in No. 11 Downing Street has well and truly ended?

Annuities may indeed have become yet another product or service which serves the interests of those making profit before it ever will the customer. This however, doesn’t mean that an approach to savings and income of this kind still doesn’t have its place. In fact, you might argue that similar products have a much bigger role to play with the State’s ability to support even our existing OAP’s dwindling almost by the hour.

Hardly a prudent or considered form of policy making on behalf of those who are falling over themselves to look after their own elect-ability today at the expense of everyone else’s tomorrows, is it?

image thanks to http://www.telegraph.co.uk

Council Spending Cuts: Savings must be the objective, not simply the means to reducing Local Authority expenditure and without providing the tools to affect real reforming change, it’s beginning to look like Eric Pickles is wielding a lot of stick without even a hint of any carrot…

December 18, 2013 Leave a comment

Local government conference

I don’t envy the position that any Government Minister has in respect of either the Deficit – which the Government are all too happy to talk about; or the escalating mountain of Debt – which they are apparently not.

Cuts in public spending are and have been inevitable since way before the last General Election. But it always seems to be the same ‘soft’ targets that get picked, rather than the controversial policy areas that make most MP’s go green, even if they are just asked to talk about them. Therefore, the announcement of a 2.9% cut in the Local Government settlement in 2014-15 is surely one of the most obvious cases of ‘passing the buck’ that there ever could be.

As both a sitting Councillor and past Local Authority Officer, I have no doubt that considerable opportunities to make savings continue to exist within most Council administrative, executive and operational functions. However, I also realise that making such savings is far from a straightforward exercise and particularly so when some areas of service provision simply cannot be cut, or in some cases will even require greater funding in the future.

Whilst cutting spending to reduce the National Deficit and hopefully at some point, start tackling the National Debt is a sensible aim, it should arguably be used as the objective rather than the means itself, and the failure of Central Government to support Local Authorities by providing the machinery of reform – whilst restricting the tax-raising ability that Councils have, is doing little more than necessitating the removal of structural security from within.

Councils are after all left with little choice but to consider and engage in the sharing of services not only between departments, but also within other Authorities as well. Whilst local politicians can already speculate about a hidden agenda moving us all towards Unitary status, there is no question that any service shared, or even Officers being given cross-disciplinary responsibility is just another step away from the end user, in the level of quality of the service being delivered if nothing else.

That’s hardly Localism now is it Mr Cameron?

The reality of the situation is that the savings that will be required to sort out the mess that the UK actually is in may well necessitate a restructure of the way that all Local Government operates.

But we are not at that point yet and it would be far better that we be able to instigate the real processes of change right now in the hope of retaining as much in terms of local services delivered locally for local people, rather than waiting for a point where financial collapse makes even these possibilities we have right now unviable, simply because a Westminster Government decided that it would be easiest inflicting budget cuts on others in the wild hope that somebody else would be responsible enough to bring about change.

Image thanks to http://www.guardian.com 

The Energy Rip-Off: Profit for most businesses is a benefit and neither a right nor the result of monopolistic guarantee. Energy Companies should be no different to other businesses and fixing prices or imposing a windfall tax is not the first step to help those where help is needed most

October 22, 2013 Leave a comment

images (42)John Major’s intervention on energy price rises certainly shows just how much of an issue the Political Parties now realise it is. But a windfall tax won’t help the people who really need that help the most and could in fact make things a whole lot worse if politicians don’t start to become a little more imaginative and thoughtful about what they now do.

N-Power were the latest of the Energy giants to announce their next jaw-dropping price hike yesterday and at 10.4%, it’s the biggest one of this season so far. But such price rises aren’t new and whilst its perfectly feasible that prices will now be loaded at every opportunity over the next 18 months to counter Ed Milliband’s very plausible threat of an anachronistic reemergence of socialist Government, the real problem is that the Energy giants collaboratively control a monopoly which politicians either fail to understand or otherwise have no desire to address.

These are after all Companies who have grown used to using excuses such as green levies, wholesale energy prices and the costs of infrastructure replacement to justify these continually upward and exponential rises, whilst their profits remain strangely, yet comfortably in tact – a situation that almost any business which offers a product which is bought only by choice could simply never hope to achieve as their market simply wouldn’t sustain it.

It really should come as no great surprise for politicians at any level that imposing a windfall tax will do little more than supply yet another opportunity for these unharnessed Companies to raise prices and inadvertently maintain profit levels in a situation that no privately owned company with this kind of responsibility to the public should ever be able or allowed to guarantee for private shareholders.

The lack of real-world understanding within the political classes is most evident when they repeatedly fail to address the lack of empathy and social responsibility that such parts of the corporate and financial worlds possess and which is increasingly manifesting itself through the price rises and blatant profiteering they undertake. Let’s make no mistake; it cries out for a level of intervention that Government seems strangely unwilling to take – or in Labour’s case, seems completely devoid of any reality when it comes to reigning in the activities of operational and service providing businesses.

Further taxation will not help people who are struggling to make ends meet in any way. People on increasingly squeezed incomes actually need prices to fall if wages are not going to go up and whilst a freeze in prices might sound good, these very same people really don’t need to experience the drop in temperature that will come if the energy supplies are turned off as a result of Red Ed seeing this quixotic plan through to fruition.

Before anything, the Energy companies need to be given the opportunity to change their approach and stop treating the UK Energy Market as a cash cow. It isn’t, and they will struggle to find anyone amongst us who believes that repetitive price rises of around 8-10% are both genuine and also peculiar to services which people simply must have when in today’s economic climate every other area of business basically has to justify each and every penny of a notable price rise.

If the Energy Companies won’t respond to such an opportunity, Government must then seek to regulate the profit margins which these Companies can achieve, whilst ensuring that every ‘hidden’ route to obtaining profit through re-routing costs and finance by such methods as creative accounting, overseas holdings and charges to ‘other businesses’ are stopped. It might take a lot of work, but this is what politicians have been elected to do on our behalf and what we have every right to expect of them.

There is of course an argument made by some for re-nationalisation of previously privatised industry too. But this also has to be put in context with an acceptance that the UK purse has already been stretched way beyond irresponsible terms and that the dream of a return to an age of unionised control and stagnation within vital services would be little more than the replacement of one small set of people benefitting from one form of misery for the masses with another.

Competition in its truest form is however another thing and with an emphasis on social enterprise as a way of tackling the Energy price problem, there is absolutely no reason why the Government or even the more Localised forms of it couldn’t set up, run or sponsor the development of non-profit making energy companies which are run on commercial lines and open up the market in a much more diverse and genuinely free-market-based way. The results could be quite surprising.

Whatever the politicians come up with it must work for the public and industry at large; not just for the Energy companies and shareholders, and certainly not just for the politicians themselves as they look for their next result in 2015.

We now need a new and gutsy kind of politics which addresses all the needs that we have by tackling them all head on and with proper regard of the implications for all along with all other areas of Policy.

It’s time that politicians started to think about changing the rules, rather than continually romanticising over possible poll results. Throwing sound bites at the media that will never really deliver for people who need help the most is not the place to start.

image thanks to http://www.telegraph.co.uk

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