Let's expand the welfare state

So says Gordon Brown by announcing a "National Care Service" modelled on the award winning (!) NHS.

Obviously the UK is running surpluses, taxes are low and there is an overwhelming need that couldn't be met by ensuring the incentives are right for people to save for their own care.

Obviously Gordon Brown thinks the British electorate is full of idiots who can't look at record public debt and record budget deficits and think, how the hell are you meant to be able to afford a huge expansion of the welfare state?

Some think it was only the Greek government that lied about public finances.

Darling's bribe with your kids' taxes

The budget 2010, a last chance for Labour to auction off the yet to the stolen loot from future taxpayers.

The deficit was predicted to be £178 billion, it looks like ONLY being £167 billion. That's around £2780 of borrowing for every UK resident, or more like over £8000 per household - borrowed on your behalf by the government.

The government predicts 3.5% growth next year, few believe it.

What will it go on?

MORE SPENDING

- Every British citizen will be legally entitled to a "free" bank account, paid for by you;
- A "Green Investment Bank" is to be set up costing £2 billion, because the government doesn't have enough banks and there is nothing like being forced to "invest" in commercially unprofitable ventures;
- New national investment corporation to be called "UK Finance for Growth";
- Support for the mortgage interest scheme, subsiding home ownership and propping up the property market (thereby disadvantage aspiring home owners) will continue, paid for by you;
- Money not needing to be borrowed because of lower than expected welfare claims is STILL to be borrowed to pay to help those under 24 find work and training, because they aren't very good at it themselves;
- £4 billion more to support the military operations in Afghanistan;
- Public sector pay will still increase, but no greater than 1% for two years from 2011, because no doubt they still deserve increases while all others have had real reductions;
- A third of civil service jobs to be relocated outside London to less expensive locations, which wont necessarily mean net savings.
- More money for pensioners, because they haven't benefited from increased Labour spending and because their grandchildren and great grandchildren wont get angry at them for paying for it

MORE TAXES

- Stamp Duty to rise to 5% on homes over £1 million (expect homes up to £1.1 million being repriced to be sold for just under that);
- Fuel duty is to go up 1% on 1 April, 1% in October and 1% in January, instead of 3% in April. The government profit from the road network will exceed 300% after spending on maintenance and capital;
- National insurance (a form of income tax) is to go up 1% as already announced, but those earning less than £20,000 wont have to pay, the logical reason surely being because they don't impose many demands on the health system (!). Those over £100,000 will have personal allowances reduced, because we know what a burden on the state they are;
- Alcohol duty goes up 5% on Sunday, 10% on Cider. Alcohol duty will go up 2% above inflation for two years beyond 2013.
- Tobacco duty is to go up 1% above inflation over that time.
- Crackdown on evasion and avoidance, with tax information agreements to be signed with more countries
- Freezing inheritance tax threshold for three years, effectively meaning more will pay it.

LESS TAXES

- End of a small stealth tax, ISA tax free allowances to rise according to inflation;
- First time home buyers (like the sons and daughters of home owners) will be able to buy a home worth up to £250,000 with no stamp duty.
- Business rates cut for one year.

LESS SPENDING

- Changes to housing benefit so that a threshold of property values will be set so more expensive properties occupied will not be eligible for the benefit. Estimated to save £11 billion.
- The Dartford Crossing (toll bridge and tunnels) and Tote (TAB) are to be privatised to raise cash to pay debt.

So the verdict? Dithering. No serious attempt to tackle the deficit, with the main news being around incremental increases in taxation.

This is the first bid in the advance auction of stolen goods called the forthcoming election.

Borrow for the internet

Budget deficit? National debt? What are you talking about?

According to the Daily Telegraph, Gordon Brown is promising to bribe current voters by borrowing from the kids some more by promising that every citizen will have access to broadband internet services, without saying when or how much he is going to spend to achieve it.

I will wait to see when he'll promise everyone will have access to uncongested roads, public transport that goes everywhere you want, and anything else people might want, but never mind, it's good old fashioned socialism - subsidise people who live in lower cost remote areas. Given he is already taxing every landline £6 (which just encourages more people to abandon such lines in favour of mobile phones), and is already subsidising to extend broadband to 90% of homes, it's just more largesse to bribe voters dressed up as "caring".

He put forward a semi-Orwellian vision of a single website for the state for citizens, personalised, so you can pay all of its varied taxes and levies, and demand information and largesse in return.

"a single website would offer people the chance to “manage their pensions, tax credits or child benefits; pay their council tax; fix their doctors or hospital appointment and control their own treatment; apply for the schools of their choice and communicate with their children's teachers; or get a new passport or driving licence - all when and where they need it"

Given the UK government record on so many IT projects, I am sure you can't wait to see how you'll be forced to pay for the failures of this idea, rather than simply letting providers figure out how to do this themselves.

Screw the deficit, build high speed railways

Unsurprisingly, Lord Adonis has announced a plan to spend £2 billion MORE of taxpayers' money (future taxpayers, since the country is still in deficit) on building a high speed railway from London to Birmingham.

Where is the money coming from?

Most of it NOT from the business users who are primarily expected to benefit from faster travel times, but from future taxpayers.

Contrast this to the Channel Tunnel, which was financed and built by the private sector, ultimately went bankrupt, but saw the banks bear the risk and help nurse it to profitability. The train companies using the tunnel pay for it, and this is passed on in fares and charges to passengers and freight customers.

This is a blatant election bribe, a grandious big project to capture the imagination and get foolish voters starry eyed about the ludicrous claim that politicians make projects like these happen. They don't. All they do is force the money out of taxpayers, or borrow from future taxpayers, to pay those who build it.

At the very least, it should be shelved until the budget is in surplus, but preferably it should be left to private enterprise. After all, why should users of high speed trains be given a subsidy on their rail fare?

Gordon Brown admits the end of the recession is just on borrowed money

The BBC reports Gordon Brown has rejected claims by the Conservatives and Liberal Democrats that the Government is delaying spending cuts because of the election.

He has claimed that to cut spending now would risk a renewal of recession.

So he is admittedly, in effect, that the economy is propped up on the borrowed taxes of future generations.

With even the more left of centre Liberal Democrats proposing £10 billion less spending than Labour, it is difficult not to believe that there has simply been a naked political calculation to leave the hard decisions on cutting spending until after the election.

Gordon Brown said cuts would be in "low priority areas". Which begs the question as to why the government spends money on such things in the first place?

Labour appears to be trying to pull the wool over the eyes of voters by the claim that cutting spending would be wrong now, but then when has it ever cut spending? Gordon Brown ran deficits in almost every year as Chancellor of the Exchequer. In constant terms total government spending since 1997 has gone up by 31% from 1997 to 2007.

So you might ask whether the average UK taxpayer thinks they have gotten value from that. Public debt went up 35% in that time, in constant terms.

So the simple question to Gordon Brown is this.

If you borrow heavily when the economy is doing well and run ever larger deficits, when do you cut spending and start running surpluses to pay down the debt?

Labour confirms it is spending more on housing

Within a BBC news report that the number of "affordable homes" built could be cut in coming years because of budgetary pressure, the government has confirmed that it is going to spend still MORE borrowed cash to depress the property market.

Housing Minister John Healey said:

"Of course the public finances are tight but this government continues to demonstrate our long-term commitment to affordable housing, whether through the extra £1.5bn investment of the Housing Pledge or the pre-Budget report's boosting of support for first-time buyers," he said.

"The Tories not only opposed us, they also proposed a £1bn cut in last year's housing budget that would have seen 9,000 fewer homes built and the loss of many jobs in the construction industry.

"Taking this as a clear indication of Tory priorities, the NHF would do well to consider the threat a Cameron government would pose to affordable housing," he said.

In other words, "of course we don't have any spare money, but who cares, we'll borrow more from your kids to spend more on subsidising housing for people to buy. This while the economy remains stagnant".

£1.5 billion that they don't have that they'll take from your future taxes and children with interest, all to bribe the target group of low income people who get these homes, and the construction industry with its employees. Other taxpayers who have homes or mortgages or have done far too well to be considered as deserving of owning an "affordable home" can just damn well put up with it.

Labour: Long term unemployed to be guaranteed "jobs"

The Times reports:

The intention is to build on the £1.5 billion youth jobs guarantee — which will be promoted nationwide in the coming weeks — for people aged 18 to 24 who claim jobseeker’s allowance for more than six months....Yvette Cooper, the Work and Pensions Secretary, has announced plans to offer “tailored support” for unemployed people aged over 50 and to ensure that claimants who take jobs would receive £40 a week more than if they stayed on benefit.


So more money that the government doesn't have, to take from future taxpayers, to cost future jobs, rather than getting the state out of the way of business.