IN 1974, I sat bored in a steamy hairdressers in Walsall (called Celia’s) whilst my Mother sipped tea under the dryer, listening to the constant, monotone chunter of the BBC on the transistor radio.
I had no idea at the time that the unintelligible drone on the wireless was setting the scene for how my mother and father, and the vast majority of the country, were going to be taxed or assisted in the years ahead.
So why the budgerigar (budgie) photo today? Well, when we left the 99% humidity of the salon, baked in cigarette smoke, I asked a newly ‘coiffeured’ mother what was on the radio. She replied “It’s only the budgie, the government tells us about it once a year”.
Either I misheard Mum, or was Denis Healey in 1974 actually talking about welfare for small caged birds, as well as an 83% top tax band and introducing VAT at 10% on sweets, ice cream and crisps?
So rattling forward almost 40 years, and like many other homeowners and business people in the UK, I sit and listen to the budget every year. I then usually sit through hours of analysis by financial journalists, then do my own sums and continue to listen to the Economist machinations once the full budget is disseminated, usually up to a week later.
Unfortunately, I believe that the budget is actually not the required listening it once was. The trials and tribulations of the economy since 2007/8 have prompted insidious changes almost on a daily basis, many of which have been to stabilise the UK’s credit rating, keeping the wolf from the door of our Banks and rebuilding the economy within the private not public sector.
What strikes me about this year is how little has actually been leaked (and since last years fiasco, I can understand why), but what has ‘got out’ is the fact that some Government departments will continue to be squeezed to provide a shot of adrenaline elsewhere. The bottom line is however, that we continue to borrow significant sums of money, we continue to spend huge amounts on propping up corporate lending through FFL (which allegedly is actually supporting residential mortgages not SME lending) and we’re spending vast amounts in welfare and health.
If we’re going to get the UK moving (and I’m particularly interested in the South West), we need to start focusing on getting five things right. Why just five? Fundamentally I believe that ‘to do’ lists become ineffective and energy sapping after 5 items, I’ve even seen people add things to their to do list (that they’ve already done) just to cross them off and feel the catharsis – whilst the crappy jobs remain on the list…. Have you done this, dear reader?
Back to the budgie, here’s my top five if I were carrying my red briefcase into the Commons today:
- Consistent and Professional means testing for all welfare claimants. We need to identify those in real need of care, support, subsistence or those that are in crisis. How can a mentally ill friend of mine survive without cash for a month due to being on a welfare appeal, whereas yesterday the Government announces childcare support, even for sole working parents with an income up to £150k PA?
- Infrastructure Development. Whilst I’ve written previously about HS2 and electrification of the East / West rail route to Temple Meads, these are mere drops in the ocean and too far away to drive real fiscal benefits imminently. We’re aware that a vast majority of travel in our part of the country is made by car or bus and we need arteries that are able to cope as additional homes are built. Is £77m being spent on the M4/M5 link going to reduce congestion and give more accurate journey planning, or should this money be spent on improving the A303, A30 and other major routes into the SW? We also need to think about planning for growth – don’t add houses where there’s no Doctors surgery, where there’s already motorway queues, where parents have to drive children to school or to the supermarket. These are all pretty basic, but we need to stop the fragmentation of infrastructure programmes and create a long term strategy, where all parts of a proposition talk to one another about getting the best from the assets available.
- Keeping the lights on. How close are we to actually losing our electricity supply? Depending on who you talk to, we’re about five cold winters away from “fluctuations in the frequency of supply”. Whilst contingency plans have been built-in for many years to avoid major outages, we have to commit to more ‘Hinkley Points’, whether Gas, Nuclear, Wind or Wave quickly to ensure our economy remains online.
- Control and define taxes to promote spending. Whether this is a reduction in VAT to promote retail spending, changing rules on stamp duty, inheritance tax or bringing more PAYE income into zero rate taxation, a defined mid term strategy needs to be published and integrated soonest. The time taken to launch, modify and administrate minor taxation changes (such as the pasty tax) was huge and these knee-jerks need to be avoided.
- Join the strategic dots. If we cut beer tax, great, but how does this correlate with the proposed minimum alcohol pricing legislation and the costs of the NHS? If we freeze fuel duty, what knock-on impact will this have on APD? Whilst governments of whatever hue are by their very nature opaque, if we’re truly are ‘all in this together‘, then transparency needs to be the order of the day.
Whether we’ve got £2.5BN or £25BN to spend, every one of us would have a different way of spending it. My big-society priorities for improved infrastructures, vocational training, transparent tax legislation and fair welfare may not be your choices, but what we all have in common is that the next ten years are going to be tough whilst we pay off our debts, I just hope the pain is equitable across all demographics.
Enjoy todays Budgie!