Category Archives: Society

Britain, Economic, Finance, Government, Politics, Society

An alternative to the Chancellor’s plan to permanently shrink the state…

 ECONOMIC MANAGEMENT OF THE PUBLIC FINANCES

George Osborne’s plans delivered within his Autumn Statement last week lays bare the neoconservative strategy. Hidden amid the plethora of all the other numbers, the Treasury has announced a further year of austerity spending for 2018/19 – the ninth in a row. This Autumn Statement, however, was different, because it was the first where the Chancellor has called for a permanent, structural shrinking of the state.

Since 2009, the Treasury has sought to return the public finances to roughly where they were before the crash. Now, though, out of political choice, Mr Osborne is proposing that government spending should fall, as a share of national income, to far below its pre-crisis level.

In 2007, public expenditure equated to 40.5 per cent of national income. It increased rapidly to 47 per cent by 2009, mainly due to the economy shrinking, rather than rising spending. Since then, the Treasury has been clawing its way back towards Labour’s level of spending, and in March Mr Osborne’s plan was to reach the pre-crisis benchmark by 2017. Within this year’s Autumn Statement everything has changed – without any announcement, the Chancellor pencilled in a cut of 38 per cent of GDP for 2018.

Historically, when public spending slipped this low it was because the economy was extremely buoyant. In the late 1990s, for instance, Tony Blair’s government were caught off guard, with inherited Conservative spending plans and a booming economy. This time is different; despite a recovery that is helping to move the country out of recession the economic projections are far from impressive, and the strain of shrinking the state is to be borne solely by spending restraint.

Examining the detail will reveal that, in 2016 and 2017, the plan is ‘more of the same’ – total real spending is to fall at a similar pace to that from 2011 to 2015. Then, on top of seven years of cuts, spending in 2018 is to be frozen, even though economic growth is predicted to be 2.7 per cent.

If implemented, there is only one conclusion that may be drawn – the end of public services as we know them. By 2018 spending on services would be almost 20 per cent lower, and that’s on a comparison with today. And if the government remains adamant in protecting areas like the NHS, international development and schools, other government departments would face cuts of up to 40 per cent. In reality, this will mean many services spending less than half what they did a decade previously. The only option in limiting this damage would be more severe cuts to welfare. It is difficult not seeing pensioner benefits, which form the bulk of welfare spending, not being affected in some shape or form.

A shrinking state. Graphical variations between the Autumn Statement, the March Budget and proposals put forward by the Fabian Society post-2015.

A shrinking state. Graphical variations between the Autumn Statement, the March Budget and proposals put forward by the Fabian Society post-2015.

The Treasury plan is wilfully counterproductive in terms of the government’s proposals for public investment. Following the Autumn Statement, the Office for Budget Responsibility (OBR) revised down its expectations for business investment as a driver of recovery, but this suggests by implication that public investment is needed more than ever. Yet, for two years after the election it is to be flat in real terms. This can only amount to a further decline (as a share of GDP), and will become a further restraint on growth.

In October, the Fabian Society Commission proposed another way with its Future Spending Choices. It argued for a significant boost to public investment and for overall spending to rise after 2015 by one per cent a year for two years. This, the Commission says, would take spending as a share of national income to the pre-crash benchmark of around 41 per cent of GDP. After that, expenditure should return to trend and match annual rises in GDP.

The Fabian Society’s proposed spending path is compatible with sustainable public finances but diverges hugely from the government’s spending plans. By 2018, there would be almost £40bn more to spend, enough to turn the Chancellor’s massive cuts to public services into a freeze. This still assumes tough spending decisions to be made, but public service meltdown could be avoided. Mr Osborne’s plans should thus not be interpreted as inevitable or even necessary.

Labour should take the opportunity in delivering post-2015 plans. They should define an alternative, so that the Conservatives do not set the terms of the fiscal debate as the general election draws near.

George Osborne’s ideological cuts are just one route to sound public finances, but many others are also available. Many will say that we do not need to deliberately shrink the size of the state to such levels that the government now seeks. Overshooting pre-crisis spending should not be the objective of any future Labour government.

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Britain, Government, Iraq, Legal, Military, Society

Iraq: ‘Single inquiry called for over British abuse allegations’…

Intro: On February 8, 2010, the writer penned an article that was visited several thousand times over by interested readers. That article is reproduced here:

ABUSE CLAIMS

A SENIOR JUDGE has told ministers to consider opening an independent inquiry into all allegations of abuse made by Iraqi civilians against the British Army. The move could lead to the biggest investigation into military malpractice ever heard in Britain.

Mr Justice Silbert, in a note written to counsel acting for Bob Ainsworth, the Defence Secretary, has told the Government:

… ‘My provisional view is that I am uncertain what is to be gained by the Secretary of State continuing to contest these claims for investigation.’

The judge, who is responsible for the management of claims before the court, says he is concerned about the cost to the taxpayer of hearing 46 outstanding individual cases, and the likely impact this would have on the resources of the High Court. It is estimated that the cases will take a decade to go through the courts at a cost of tens of millions of pounds to the taxpayer and warns that not holding an independent single inquiry could lead to a “further waste of valuable court time”.

Mr Justice Silber says the Ministry of Defence has already shown itself to be “unable to give proper disclosure” in the case of the Battle of Danny Boy in 2004 in southern Iraq, where it is alleged that British soldiers murdered Iraqi civilians.

The judge’s note emerged at the same time as the Government was served with the first claim of abuse brought by an Iraqi woman.

Samahir Abbas Hashim, (32), six months pregnant at the time of the alleged assault, claims she was so badly beaten by British soldiers that she lost her baby.

At 2am, on 21 June 2006, Mrs Hashim says she was sleeping with her children on the roof of her home in Al-Zubayr, Basra. Her husband was sleeping downstairs.

She alleges she awoke to the sound of a large explosion which blasted open the front door of her house and heard British soldiers running inside, shortly after. Some of them pinned her husband to the ground while others rushed to the roof top where she had been sleeping. Mrs Hashim says she was frightened and rushed to protect her youngest child. At this point, she declares, a female British soldier kicked her in the back. As a result, she says, she suffered a miscarriage the next day.

Lawyers acting for Mrs Hashim have written to the Ministry of Defence claiming that her case is clear evidence of “systematic and gratuitous abuse and degradation of Iraqi women by British forces”. Further allegations have been made in eight other cases brought by husbands and relatives of women who say they have been assaulted. The allegations include claims that British troops subjected Iraqi prisoners to rape, sexual humiliation and torture.

Public Interest Lawyers, a firm which is representing 66 Iraqis in 46 separate cases, argues that the Government must hold a single inquiry into the UK’s detention policy in south-eastern Iraq.

…’There are so many cases and so many have so much in common – similar allegations at similar facilities, often involving the same people. We can’t have these dragged out over 10 or 15 years. This is the only rational option.’

..

TWO public inquiries have already been launched. The first, into the death of hotel worker, Baha Mousa, (26), in British military custody in September 2003, began hearing evidence last July. It is looking specifically at how ‘prisoner-handling techniques’ banned by the Government in 1972 – including hooding, food and water deprivation and painful “stress positions” – came to be used in Iraq.

And, in November, the Ministry of Defence announced details of a second inquiry into allegations that Hamid Al-Sweady, (19), and up to 19 other Iraqis were unlawfully killed and others ill-treated at a British base in May 2004 after the Battle of Danny Boy.

Bill Rammell, the Armed Forces Minister, has so far resisted calls for a public inquiry into the treatment of detainees by British forces. However, an MoD spokesperson said that Government lawyers were actively looking at complying with the wishes of the Iraqis.

On the claim being made by Mrs Hashim, Mr Rammell said:

… ‘The MoD recently received a letter alleging the abuse of an Iraqi woman, but has not yet been given any evidence. Abuse allegations are thoroughly investigated, as this one will be, and – where proven – those responsible are punished. However, these are allegations and must not be taken as fact.’

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Britain, Energy, Environment, Government, Politics, Society

Concern over energy firms refusing to pass on price cuts…

ENERGY BILLS

Intro: Millions of energy consumers on fixed deals will lose out

Millions of energy consumers with fixed price energy tariffs will not get a £50 reduction in utility bills as promised by David Cameron and George Osborne. A pledge was given this week in the Autumn Statement that electricity bills would be cut following the decision by the government to roll back some green levies.

The energy giant E.ON has announced that more than one million of its customers will get a reduction of only £12 – or 23p a week.

EDF is taking the same line with its one million fixed rate customers, who include many pensioners and families. Npower, SSE and Scottish Power may follow suit.

The Prime Minister, Chancellor George Osborne and Energy Secretary Ed Davey have made repeated pledges in their efforts to protect customers by rolling back environmental charges.

Mr Osborne said this week: ‘There’s going to be an average of £50 off people’s bills … We are absolutely insistent that this is going to be brought in.’

The smaller reduction of £12 covers the Government’s decision to switch funding of the Warm Homes Discount – a subsidy for poorer families – from energy bills to general taxation. The rest of the decrease was expected to come from changes to the Energy Companies’ Obligation Scheme, a levy applied to all bills to raise money for energy-saving measures for poorer households.

However, the element of the reduction is not being passed on to customers on fixed tariff deals by some companies.

In contrast, British Gas, the largest of the ‘big six’ suppliers, announced that all tariffs and payment methods will get a reduction of £53 from January 1.

A spokesperson for Consumer Futures, a campaign group, said: ‘The message has been that people were going to save £50 on their energy bill, but it seems a fair chunk of people will not get that. This sort of behaviour is not going to do anything to reassure customers … People feel confused and angry about their energy bills. This latest development just adds insult to injury.’

The spokesperson added: ‘I think in the current climate, bearing in mind how people are struggling, the right thing to do would be to apply the full reduction across the board. That is the expectation that the Government has created.’

Following the Autumn Statement, E.ON immediately announced a price rise of almost £60 a year for customers on standard tariffs. The changes will take effect from January 18.

The provider says that cutting the bills of fixed price customers by only £12 was justified because many of these people were already on relatively good price deals and tariffs.

EDF took a similar line and said its short-term fixed deal is some £90 a year cheaper than its new standard prices.

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