John Hemming's Web Log John's Reference Website
Thursday, December 20, 2012
  Sir Albert Bore and the Temple of Doom
Sir Albert Bore has referred to the "jaws of doom". This he has done when central government are cutting the spending power of the city council by 1.11% in cash terms. Nationally the figures are 1.7% (across England).

At the same time the council has decided to put up the wages of all council staff paid under £7.20 to £7.20. This is called the "living wage". Many people who earn less than this get tax credits. Hence it is substantially a swap between central government costs and local government costs. They have also included the 16-21 year olds. Hence some of them have had increases of 75% or 85%.

It is a nice policy in the sense that it is being nice to people. However, because they propose also to ensure that contractors do the same they wish to find £10m per annum for the same policy.

At the same time they want to raise more council tax by charging people on JSA 24% of the council tax.

The council could find £10m pa by sacking over 300 additional staff.

This is why the council's pleadings are misleading. They build up a large forecast deficit by putting in things that they would like to do.

Most people would be happy for low paid people to be paid more. However, it is not a zero sum issue. Something has to happen.

For example we could close libraries to save money to pay council staff more. We could charge people on JSA council tax to pay council staff more. We could put up council tax in order to pay council staff more. We could sack 300 people and put up the pay for other council staff.

I am not sure myself that these proposals would find favour. All of the council's headline figures need checking in the same way.

It is the fact that the country as a whole needs to cut public spending to bring it back to about 2/5 of the national cake. This is a greater proportion than under the Blair governments and is not a small state.

If Labour wish to argue that a cut of 1.11% is too much they need to explain what cut is acceptable rather than simply wailing in the Temple of Doom.

 
Comments:
The optimal amount of government spending is 1/e where e is the natural logarithm base ~2.718281828.

 
The optimal value of government spending is 1/e where e is the natural log base ~2.718281828.
 
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