Bankers who torpedoed the economy are set to get away with it after all

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Andrew Green QC, Andy Hornby, bank, banker, Banking Standards, Coalition, Conservative, crisis, David Cameron, Democrat, economic, economy, FCA, financial, Financial Conduct Authority, Financial Services Authority, fred goodwin, fred the shred, FSA, fund, George Osborne, government, HBOS, James Crosby, Johnny Cameron, Lib Dem, Liberal, Lord Stevenson, maxwellisation, Mike Sivier, mikesivier, Mirror, Parliamentary Commission, pension, Peter Cummings, politics, Private Eye, RBS, recession, Robert Maxwell, Royal Bank of Scotland, Tom McKillop, Tories, Tory, Vince Cable, Vox Political

Not even this many: This Economist cartoon paints a false picture of the situation. The magazine has stated: “In Britain, which had to bail out three of its biggest banks, not one senior banker has gone on trial over the failure of a bank.”

Here’s a word that should be in all our dictionaries but probably isn’t: ‘MAXWELLISATION’.

It refers to a procedure in British governance where individuals who are due to be criticised in an official report are sent details in advance and permitted to respond before publication. The process takes its name from the late newspaper owner Robert Maxwell, who fell off a yacht after stealing the Mirror Group’s pension fund.

Maxwellisation is how the irresponsible bankers who caused the economic recession, out of which some of us have just climbed according to the latest figures, are likely to get away Scot (and the word is used most definitely in reference to the land north of England) free.

Current folk wisdom has it that most of us are still unhappy about the banking crisis. We want to see heads roll.

This is a serious headache for the Coalition government, according to Private Eye (issue 1371, p33: ‘Call to inaction’) – because almost nobody involved in that fiasco is likely to suffer the slightest inconvenience.

They really are going to get away with it because the government of the day really is going to let them.

It seems that Andrew Green QC has been hired to find out whether action could and should be taken against those who bankrupted HBOS, beyond corporate lending chief Peter Cummings, who has already been banned for life from the industry and was fined half a million pounds in 2012.

That might seem a lot of money but the HBOS crash, along with that of the Royal Bank of Scotland, cost the taxpayer £60 billion (along with who-knows-how-much in interest payments).

Mr Green has also been asked why HBOS chief executives James Crosby and Andy Hornby were untouched, along with chairman Lord Stevenson.

For the facts, he need look no further than what happened with RBS, the Eye reckons.

In 2010, the Financial Services Authority – discredited forerunner to the FCA – allowed (allowed!) RBS’s top investment banker Johnny Cameron to ban himself from another senior banking job. The following year it pronounced chief executive Fred ‘The Shred’ Goodwin and chairman Sir Tom McKillop effectively blameless. Mr ‘The Shred’ was stripped of his knighthood, however.

This whitewash appears to have been an embarrassment for business secretary Vince Cable, who announced in December 2011 that he wanted to prosecute, disqualify as directors or ban from the financial sector those responsible at RBS and passed his request for disqualification up to the Scottish law officers in early 2012.

He is still awaiting an answer, it seems.

Back to HBOS, where Cable has made “similar disqualification noises”, according to the Eye, after a “highly critical” report from the Parliamentary Commission on Banking Standards last year.

Unfortunately for him, not only is HBOS also based in Scotland, so any proceedings may have to follow a similar path to those involving RBS, but also the FCA’s report into the bank’s failure is currently “unfinished”.

This is because it is being “Maxwellised” – according to the Eye, “whereby lawyers for those in the frame (if allowed) remove anything critical of their clients”.

The report continues; “With RBS, ‘Maxwellisation’ took several months and resulted in the whitewash that made any future action against those found not guilty difficult, if not impossible.

But the public wants heads to roll! Will anybody get what’s coming to them?

According to the Eye, the answer is a qualified “yes”.

Only one boss of HBOS still has links with any organisation regulated by the FCA – James Crosby is a director of the Moneybarn sub-prime car finance group and its parent, the Duncton Group. The FCA took over regulation of the consumer loan industry in April and has until December 2015 to provide full approval to the Moneybarn operation. The Eye states: “By then chairman Crosby would have to pass its ‘fit and proper’ test. He is completely unauthorised. So, a low-hanging scalp.”

Beyond that, expect “a wringing and washing of Coalition political hands, blaming legal loopholes, failures of others and it-was-all-a-long-time-ago”.

It is possible that other directors could be offered the Johnny Cameron deal – agree not to be a director for a few years “and this will all go away quickly and cheaply with no public hearings”.

Cable – along with George Osborne, David Cameron and any other Coalition MP who claimed that they were making laws to ensure the bankers responsible would face prison sentences – will simply walk away from the whole affair and hope that you forget about it.

Are you going to let that happen?

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Don’t be naive, Len – Cameron WANTS to lock privatisation into the NHS

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America, Andrew Lansley, company, Conservative, corporation, David Cameron, Democrat, EU, european union, firm, health, healthcare, HSCA, income, Investment Partnership, lawsuit, legal action, Len McCluskey, Lib Dem, Liberal, litigate, litigation, multinational, National Health Service, NHS, private, privatisation, profit, shareholder, Social Care Act, sue, Tories, Tory, Transatlantic Trade, TTIP, Unite, United States, US, Vince Cable, Whig

Unite’s secretary general Len McCluskey would be naive indeed to think David Cameron is ever likely to heed his call for the National Health Service to be kept out of the EU/US Transatlantic Trade and Investment Partnership.

McCluskey has warned that the NHS could be sued by American healthcare multinationals if a UK government tried to return services to state control; they would argue that such renationalisations interfered with their potential profits, in breach of the trade agreement, as has been discussed on this blog in the past.

His appeal misses the point. The entire thrust of Coalition government policy is to ensure that the NHS becomes vulnerable to just such pressure, in order to ‘lock in’ the privatisations inflicted on us by Andrew Lansley’s horrifying Health and Social Care Act 2012.

One has to look no further than Vince Cable for confirmation of this. The Whig business secretary (you can’t call him a Liberal Democrat any more, and as a commenter pointed out today, the government as a whole behaves more like the old-style Whig Party from the 19th century. If the cap fits…) told The Independent: “There is no suggestion whatever that the TTIP negotiations could be used to undermine the fundamental principles of the NHS or advancing privatisation.”

What he means by this is that – as far as he is concerned, advancing privatisation is a fundamental principle of the NHS since Andrew Lansley’s hateful Act of Parliament. Therefore the TTIP agreement can only contribute to that project.

He said: “Our focus for health is to enable our world-class pharaceutical and medical devices sectors to benefit from improved access to the US market.”

If we have world-class healthcare already, why do we need access to a market-driven system that can only drag us down into mediocrity? Clearly he is not talking about healthcare at all; he is talking about the health service as a source of profit. The “benefit” he describes can only be profit – income for shareholders in private companies that could not be accrued while they were excluded from NHS work.

Everybody involved in this betrayal should be imprisoned as a traitor, with Cable and Lansley first to be sent down.

The great pensions rip-off

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BBC, benefit, benefits, bus pass, class, Coalition, cold weather payment, Conservative, contract, couple's, CPI, Democrat, earnings, final salary scheme, flat rate, government, guarantee, health, inflation, Lib Dem, Liberal, life expectancy, means test, Mike Sivier, mikesivier, minimum income guarantee, National Federation, national insurance, Occupational Pensioners, out, pension, pension credit, Pensions, people, politics, poverty, rate, savings, social security, tax, Tories, Tory, triple-lock, TV licence, Vince Cable, Vox Political, workplace

Someone’s raiding the pensions piggy-bank: Government changes mean the rich will be subsidised by the poor. [Picture: The Guardian]

We all know that pensioners have a charmed life under the current government – right? Pensions take up around half the £160 billion social security budget and there are other perks like the cold weather payment during the winter months, free bus passes and free TV licences – right?

They get a triple-lock inflation guarantee, under which the state pension rises according to the highest of CPI inflation, the rise in earnings or 2.5 per cent. They get Pension Credit (otherwise known as the Minimum Income Guarantee) to ensure they receive a weekly minimum of more than £140.

So no matter what happens to the rest of us, they’re in clover – right?

Not really.

Just taking those examples, Tory Liam Fox wants to cut the cold weather payment down to nothing, and the Liberal Democrat Vince Cable wants to means-test or tax pensions. The free TV licence will disappear if the rising clamour to privatise the BBC receives government blessing.

Then there’s the fact that the age at which we can start drawing our pensions is rising – from 65 (for men) and 60 (for women) in 2010 to 68 (for both) by 2046, which may seem a long way into the future but in fact affects people from 2016 onwards.

The government is bringing this in because people are living longer, and this may seem like a reasonable idea – until one takes into account the fact that life expectancy is hugely dependant not only on where you live but on your social class as well.

For example, in Kensington and Chelsea, average male life expectancy in 2010 was 85.1 years, and average female life expectancy was 89.8 years. In Glasgow at the same time, average male life expectancy was 71.6 years – 13.5 less than men in Kensington and Chelsea – and average female life expectancy was 78 years – 11.8 years lower than in Kensington and Chelsea.

Between 2004 and 2010 the gap in life expectancy between the two places increased by one year and 1.7 years for men and women respectively, indicating that health inequalities across the UK are increasing.

Social class also has a huge effect on life expectancy, with people in higher managerial and professional occupations likely to live 3.5 years longer than those in routine occupations.

But they all pay National Insurance contributions for the same period of time – 30 years – in order to qualify for the state pension. This means working class people living in social housing are likely to be paying towards the pensions of upper-middle class professionals in penthouses, as well as their own.

Now the government is introducing the flat-rate pension for people reaching the state pension age who have made 35 years’ National Insurance contributions. The payment will be £144 per week at today’s prices.

People who have built up large savings for their retirement will be considerably better-off because pensions will no longer be means-tested (Pension Credit will be phased out).

Existing pensioners will remain in the old system and are likely to be worse-off than those who qualify for the new pension.

People aged in their 20s at the moment may also be worse-off than under the current system (so, even with pensions, the Coalition government has found a way to attack the young).

And people who have not paid National Insurance for at least seven years in total will not qualify for the new single-tier state pension at all.

Workers who belong to contracted-out final salary schemes pay lower NI contributions at present, but these will rise after 2016. Public sector workers in such schemes will have to pay more.

The couple’s pension rate, which is lower than the individual rate, is being phased out. This means around 30,000 women due to retire in and around 2016 are expected to lose out, as they were relying on their husband’s NI record for a state pension income and will no longer be entitled to it.

We already knew all of that.

Now, the National Federation of Occupational Pensioners says the government is proposing changes to workplace pension schemes that will undermine benefits, increase pension poverty and widen the gap between the private sector and public sector schemes, according to Mature Times.

The proposed changes mean companies will be allowed to change their scheme rules to remove the inflation link for pensions, increase their pension age and get rid of other benefits such as pensions for spouses. This significant downgrade of pension provision means scheme members could reach retirement and then realise that the expected return from their pensions has been severely reduced.

Put it all together and the less wealthy are being subjected to another rip-off – this one delayed until retirement. Who knows how much energy bills will cost by then? How many of us will have rent to pay, or mortgage payments to complete? How much will the weekly groceries cost? Will the equivalent of £144 per week be enough, by then?

And – in the current cutthroat times – how many of us will survive to find out?

Conference vote leaves Lib Dems facing both ways on Bedroom Tax

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bedroom tax, benefit, benefits, Coalition, Daily Telegraph, Danny Alexander, David Cameron, David Laws, Democrat, Ed Miliband, government, grass roots, Health and Social Care Act, Jobseekers (Back to Work Schemes) Act, Julie Porksen, Lib Dem, Liberal, Localism Act, Mike Sivier, mikesivier, Nick Clegg, Nick Robinson, Orange Book, people, politics, social security, student fees, Vince Cable, Vox Political, welfare, Welfare Reform Act

“So what’s new?” you’re probably thinking.

Well, the passing of the motion to condemn the Bedroom Tax as official Liberal Democrat policy indicates that there is a huge rift between the way grassroots Lib Dems think and what the Parliamentary Party is doing.

But is it enough to force a split in the Coa-lamity – sorry, Coalition – before the next election, as Vince Cable has hinted?

Who knows? It’s the Lib Dems.

It could indicate that time is running out for the ‘Orange Book’ Liberal Democrats, who include Nick Clegg and Danny Alexander among their number – despite claims by the Daily Telegraph that they have become more influential.

My brother, the blogger beastrabban, told me of a recent conversation between a friend of his and a former Liberal Democrat MP, in which the ex-Hon Gentleman made his opinion of the Orange Bookers – the party’s right-wingers – perfectly clear: “They’re not Liberal”.

This certainly seems to be the feeling of the party’s rank-and-file. Julie Porksen, the Northumbrian member who tabled the Bedroom Tax motion, said: “We are Liberal Democrats and we do not kick people when they are down.”

This may have come as quite a shock to Messrs Clegg, Alexander, David Laws (editor of the Orange Book) and their nearly-Tory buddies, who have been merrily kicking people when they were down ever since they decided they weren’t going to abolish student fees after all, but would help the Tories increase them instead.

Since then, Parliamentary Liberal Democrats have helped force some of the worst injustices of modern times onto the British people, including the Health and Social Care Act, the Welfare Reform Act, the Jobseekers (Back to Work Schemes) Act, the Localism Act and, yes, the Bedroom Tax.

Nick Clegg is clearly a long, long way out of touch with his members. All he could say about it at conference was that “you would have to be made of granite” not to have feelings on the issue.

Would he commit to changing it? No.

So it seems the Liberal Democrat leader is refusing to carry out the will of his party. I wonder what they’re going to do about it?

One way Clegg could save his career might be to bring the Coalition to an early end, as suggested by Vince Cable at a fringe event arranged by the Independent.

But it seems likely Cable was just causing mischief. “It is obviously a very sensitive one. It has got to be led by the leader,” he said.

Again, this would put Clegg in a very awkward position. Splitting the Coalition means giving up the only power or influence he is ever likely to have.

At the end of the day, it’s not going to make much real difference. After the 2015 election his party will probably have fewer MPs than the DUP, if local election results are any indication. He must take responsibility for that – his leadership is bringing his party to the brink of oblivion.

Nick Robinson’s speculation that Clegg could jump from coalition with Cameron to an alliance with Ed Miliband is, therefore, premature.

But there’s another Liberal Democrat conference to come before the general election. Maybe, by then, Nick Clegg will have grasped that he needs to put his party’s best interests before his own ambitions.

Want to know who we’ll be asked to fight in a few years? Find out who’s buying our weapons now!

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chemical weapon, civil war, Coalition, Conservative, Contra, David Cameron, Democrat, fighter, government, Iran, Iraq, jet, Kuwait, Labour, Liberal, Mike Sivier, mikesivier, nerve gas, Nicaragua, Parliament, people, politics, potassium fluoride, rebel, sale, Sarin, sell, sodium fluoride, Syria, Tories, Tory, Typhoon, United States, USA, Vince Cable, Vox Political

There is an easy way to stop wars with foreign countries: Stop selling them weapons!

If there’s one thing that all politicians believe, it seems, it is that history will teach us nothing.

That’s the only explanation possible for Vince Cable selling the ingredients to make chemical weapons to Syria, 10 months into that country’s civil war.

Does he not remember how the United States gave money, weapons and training to Iraq during the Iran-Iraq war – then launched its own war against Iraq after that country got too big for its boots and invaded Kuwait? Does he not remember the 16 British firms that suppled weapons to that country?

The sale of weapons to foreign countries is always a bad move. Look at the Iran-Contra affair – again involving our good buddies the United States. Weapons were sold to Iran – so America was funding both sides of the Iran-Iraq war – and the proceeds used to fund the Contras in Nicaragua – another war!

Now we have a Tory-led Coalition government that wanted to get into that morally-dodgy but lucrative weapons-selling action, it seems.

So in January 2012, 10 months after violence erupted in Syria, Vince Cable licensed the exporting of potassium fluoride and sodium fluoride to the Syrian government – both chemicals being ingredients of nerve gas.

The chemicals were sold under licences that specified they should be used for making aluminium structures like window frames – but the government has refused to identify the licence holders. Dodgy!

Sarin, the gas thought to have been used in an attack last month that killed nearly 1,500 people, can be made from such ingredients.

This means that, in the same way as the United States with Iraq, it is entirely possible that the Coalition government wanted British troops to attack Syria in response to a situation that the Coalition government created!

And then, when Labour – along with Tory and Liberal Democrat rebels – actually put a stop to this insanity, some of these people actually had the front to try to steal the moral high ground, accusing them of perpetuating a war that was killing children!

Remember when Vox Political published an article last November, about David Cameron selling arms and aircraft to countries in the Middle East? It seems this is what comes of that sort of thing.

On that occasion, he was selling Typhoon jet fighters to Middle East nations. How long before we’re told we have to go and shoot down however many of them he managed to sell?

Zero hours, zero benefits, zero enthusiasm. Why would anyone take a job on these terms?

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abuse, andy burnham, BBC, benefit, Chartered, CIPD, contract, Dave Prentis, Department, development, earning, economy, education, employment, flexible, health, holiday, Institute, Job Centre, manager, Mike Sivier, mikesivier, minimum wage, occasional, pay, pension, Pensions, personnel, Peter Cheese, public, punish, reward, safety, sanction, sickness, Unison, Vince Cable, Vox Political, work, zero hours

The rise of zero-hours contracts: These figures from the Office for National Statistics may be showing only one-fifth of the picture, according to new research.

The rise of the zero-hours contract must be deeply disturbing to all those with an interest in fair employment practices.

The arrangement is that an employee agrees to be available for work whenever required, but with no set number of hours or times of work specified. The employee is expected to be on-call at all times but is paid only for the number of hours that are actually worked.

There appears to be no pension scheme, no sickness cover, no holiday entitlement – no rights other than those laid down by health and safety regulations (which the government is trying to ditch) and the National Minimum Wage Act (also under threat from the Conservative-led government).

Also, the system is open to abuse by managers, who can use it to reward some employees (and the term is used in its loosest possible sense) with extra hours or punish others with fewer.

And how, exactly, is an employee supposed to be engaged in, and enthusiastic about, a job where they are treated as a disposable commodity, to be picked up and thrown away whenever it is expedient?

It seems possible that there is an argument in favour of zero-hours contracts – but only for employees who want to top-up another income stream; people who want occasional earnings and are flexible about when they work. The problem here is that it seems likely employers will want these people to work at times when it will be hard to meet the commitment.

For anyone else – including people who are unemployed, penniless, and need the certainty of a properly-constituted employment contract with set hours, pay and conditions, there seems to be no point in taking up such a contract at all. Yet they are proliferating across the UK.

Is the Department of Work and Pensions, through the Job Centre Plus network, forcing these conditions on jobseekers?

Such a situation might be a huge boost to employment figures, but it would also explain why average pay has fallen so drastically in recent years and the economy has failed – so abjectly – to reignite.

Today (Monday) it is being reported that more than a million UK workers are on zero-hours contracts – four times official estimates.

The BBC is reporting that 14 per cent of these could not earn a basic standard of living. If Job Centres are forcing people into these jobs, via the sanctions regime, this is scandalous. Perhaps it is permitted by law, but this would only mean that the government should have a duty to ensure that jobs which are taken under the threat of sanction are capable of providing this basic standard.

Worse still for the government is the allegation, in research by the Chartered Institute of Personnel and Development, that public sector firms – those with government contracts – are more likely to use zero-hours contracts than private companies.

This is particularly prevalent in education and healthcare.

And how is the benefits system affected by these contracts?

CIPD chief executive Peter Cheese told the BBC: “Zero-hours contracts cannot be used simply to avoid an employer’s responsibilities to its employees.” But isn’t that exactly how they are being used? Don’t the number of people saying they can’t make ends meet, and the wider state of the economy, indicate exactly that?

Unison general secretary Dave Prentis seems to have got it right when he said: “The vast majority of workers are only on these contracts because they have no choice. They may give flexibility to a few, but the balance of power favours the employers and makes it hard for workers to complain.

“The growing number of zero-hours contracts also calls into question government unemployment figures.”

Business secretary Vince Cable has ordered a review of the zero-hours contracts system, to take place over the summer. He played down fears of abuse, saying evidence was “anecdotal” and adding that “it’s important our workforce remains flexible” (in employment terms, this means all the power is with the employer, while the actual worker has to adapt to the circumstances foisted upon them).

Shadow Health Secretary Andy Burnham called for zero-hours contracts to be banned, back in April this year.

It seems clear that they are unsafe and open to abuse. But would an all-out ban be appropriate?

Would it not be wiser for Job Centres to continue advertising them, but with no obligation to recommend them to jobseekers (and certainly no requirement to force anyone into applying for them), and with a requirement to warn anyone considering taking up such a position about the possibility that they will not be able to survive on the pay provided?

This might go some way to redressing the balance of power with employers; without the coercive power of the government supporting these contracts, they might try more traditional (and fairer) employment models.

This is a subject worth more examination. What are your thoughts?

Employee ownership: Has the government actually done something right?

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bis, Busines, business, buy-out, buyout, capital gains, Co-operatives UK, Coalition, company, Conservative, consult, Danny Alexander, Department, economy, Ed Mayo, employee, Employee Ownership Association, firm, government, Income Tax, innovation, Labour, Liberal, Liberal Democrat, Mike Sivier, mikesivier, National Insurance Constribution, Nick Clegg, NICS, owner, people, politics, relief, skills, stake, tax, Tories, Tory, Vince Cable, Vox Political, work

Long live co-operatives: At long last, it seems the government (or at least the Liberal Democrat side of it) is offering support to the most successful and supportive business model available – and we can hope that Labour will do the same. But where are the Conservatives in all this?

Today, July 4, is officially Employee Ownership Day – did you know that?

Employee ownership means all employees of a business have a significant and meaningful stake in it. This could include financial participation but must include provision of access to organisational structures. Where financial participation does take place, there is currently no set rule on what percentage of issued shares is a significant and meaningful stake, and this is something that I believe should be changed to ensure it is worthwhile.

Employee ownership can generally take one of three forms:

• Direct employee ownership – employees become individual owners of shares in their company;
• Indirect employee ownership – shares are held collectively on behalf of employees, normally through an employee benefit trust; and
• Combined direct and indirect ownership – a combination of individual and collective share ownership.

The Employee Ownership Association estimates that UK-based employee-owned companies had a turnover of more than £30 billion and employed more than 130,000 people in 2011. Employee-owned businesses enjoy greater staff retention, innovation and motivation than non-employee owned businesses and, in turn, these deliver wider economic benefits including increased productivity, profitability and more resilience to economic shocks.

The sector has grown by more than 20 per cent since the start of the recession in 2008; while 65 per cent of conventional businesses survive their first three years, 90 per cent of co-operatives remain in business; and 37 per cent of directorships in co-operatives are held by women, compared with 13 per cent in leading UK companies (this last point should not be relevant in this day and age, but the gender gap is quite clearly still there, so it is).

All of the above is from a government press release issued today, but eerily resembles comments made on this blog in the past – like this one or this.

According to the government, not only will this successful model of business be easier to understand and quicker to set up after Vince Cable publishes new guidance today, but the government is also consulting the public on the possibility of providing two new tax reliefs to help indirect employee-owned businesses get themselves set up.

To my way of thinking, this seems spectacularly useful, but this is the Coalition government so there must be a catch. Right?

It seems the Department for Business, Innovation and Skills will be publishing:

• Guidance for employees who want to request a move to employee ownership;
• Model documentation on a move to employee ownership with accompanying BIS and HMRC guidance;
• Guidance from the Employee Ownership Association explaining the different models of employee ownership; and
• Guidance from Co-operatives UK on how co-operative principles and ways of working can be implemented into employee-owned businesses.

“The government is committed to supporting this business model and will today launch a consultation on providing two new tax reliefs to encourage employee ownership,” according to the press release.

“This sector has the potential to benefit the wider economy, therefore the government is seeking views from people both inside and outside the employee-ownership sector to ensure the reliefs are supportive and effective.

“The Employee Ownership Association, in conjunction with the government, has helped to organise a number of events in the UK where employee-owned businesses are opening their doors to showcase the benefits of their business model.”

Nick Clegg actually said something I can support: “The benefits of employee ownership are clear. Staff who have a stake are more motivated and are rewarded for thinking in the long-term. That’s good for business and good for families, as it means lower absenteeism and lower levels of staff turnover.” This is something I have been saying for many months; it’s as though he has been reading this blog.

He said the government has set aside £50 million per year, starting next April, to give businesses and employees an incentive to adopt employee-owned models, and will be providing Capital Gains Tax relief for those who sell a controlling stake in a company to their staff.

It will be interesting to see how many firms take up the offer; from that information we can work out whether the greed that increased bosses’ pay by 700 per cent over the last 10 years – while employees got a miserly 27 per cent rise – is still rampant.

There is also a question over whether this is the right time – the middle of the longest economic slump in recent history.

It could be!

Cable reckons “there has never been a more important time to support different ways of running a business”.

He said: “The evidence is clear that employee-owned businesses not only help us build a stronger economy, but boost the retention, innovation and motivation of their employees.”

Co-operatives UK Secretary General Ed Mayo said his organisation would be supporting today’s events by launching its own publication, Simply Buyout – an essential guide to employee buyouts and becoming a co-operative employee owned business.

The consultation on the two new tax reliefs can be found online here. This stage of it will run until September 26 this year. The government will publish a summary of the responses in the autumn, and they will help to inform draft legislation.

The first is a Capital Gains Tax relief which would apply when the controlling share of a business is sold into an indirect employee ownership structure, and the government hopes it will encourage individuals wishing to sell their business to consider it.

The second tax relief is an Income Tax and National Insurance Contributions (NICs) exemption, that would allow indirectly employee-owned companies to pay employees a certain amount every year that is free of Income Tax and NICs. There would also be an employer NICs exemption for the company.

The government announced in the March Budget that it would provide £50 million annually, from 2014-15, to support employee-ownership models and to incentivise growth of the sector.

The press release features a quote from yet another Liberal Democrat – Danny Alexander – who said: “We want to encourage greater use of employee ownership in UK businesses and want to ensure that we provide reliefs that are supportive and effective. Views are invited from both people inside and outside the employee ownership sector.”

So that’s three high-ranking Liberal Democrats speaking up for it, and no Conservatives. Interesting. Do the Blue Meanies have nothing to say in favour of the proles part-owning the firms where they work?

And what about Labour? Does the Party of the Workers support this activity? This Party member hopes it does.

It will be hard to tell from the press coverage, however.

At the time of writing, there hasn’t been any.

Tory insanity outbreak: Now disgraced Liam Fox wants to harm pensioners

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Adam Werrity, benefit, benefits, capital gains, cheat, chris huhne, Coalition, Conservative, cut, debt, deficit, Democrat, economy, education, expenses, Free School, freeze, government, health, international development, Justice, Liam Fox, Lib Dem, Liberal, Michael Gove, Mike Sivier, mikesivier, NHS, Nick Clegg, Parliament, pension, people, pervert, policy, politics, public spending, school, speeding, tax, taxpayer, Theresa May, Tories, Tory, Vince Cable, Vox Political, Winter fuel allowance

Do not approach: Another Conservative goes feral. Pensioners – guard your assets!

There seems to be an increasing willingness among politicians to give high regard to disgraced ex-colleagues.

Only last weekend, Nick Clegg praised Chris Huhne, who faces sentencing today after being convicted of perverting the course of justice regarding speeding points on his driving licence.

Now Liam Fox has weighed into the debate on future Conservative Party policy. Dr Fox had to resign after being asked why a man who was not a part of the government had attended more than half of his official engagements including trips abroad, at the public expense.

His ideas are just as appalling as Theresa May’s plan to take away all of your human rights, as detailed in this blog yesterday.

He wants to freeze public spending for the next five years – that’s well into the next Parliament, no matter who wins.

He wants to spend the money this will allegedly save on tax cuts, notably capital gains tax – in other words, another nice little earner for the very, very rich. Odious, aren’t they?

Like Vince Cable of the Liberal Democrats, he wants departmental budgets that are currently ring-fenced to lose that protection – including the NHS, schools and international development.

The NHS is already the subject of controversy over its spending because the government has claimed budgets have increased, while the UK Statistics Authority stated categorically that they have dropped.

Most schools have been under-funded by Michael Gove, in favour of his ridiculously expensive ‘free schools’ project. Under Dr Fox’s plans, unless your child is privately-educated or has been cherry-picked to go to one of these new institutions, their education would suffer and their chances in life would be hugely reduced.

International development is hugely controversial as well. At a time when the UK is struggling to pay for itself, critics say, the country should not be giving cash away to foreign nations.

And he wants to end protection for universal benefits – such as the pensioners’ winter fuel allowance.

Pensioners: This Tory wants to take away the extra money you get to heat your home during the winter, and the Liberal Democrat Vince Cable wants to means-test or tax the pension for which you have spent your entire working life paying. Do you really want to vote either party back into power to do these things to you?

Fox is a leading member of the Tory right-wing, and this is clear from his demands. But his own past actions make his current intervention laughable. He wants to cut public spending by – according to his own calculations – £345 billion over five years, yet he himself is an expenses cheat who has overspent taxpayers’ money on himself and his friends.

In 2009 it was reported that he had claimed £19,000 on expenses for his mobile phone bill over the previous four years. He said he was looking for a cheaper tariff.

He overclaimed £22,476 in mortgage interest payments, which he was forced to pay back in 2010. Fox said he had decided to remortgage his second home to pay for redecorations, and claim the higher interest repayments on his expenses because this represented value for money – he could have charged the taxpayer for his decorating bill directly. This was not true, according to the judge dealing with the case.

A study of Parliamentary records in the Daily Telegraph showed that he was receiving rental income from his London home while simultaneously claiming rental income from the taxpayer to live at another residence.

And then there’s the big one, for which he lost his job: Fox’s relationship with Adam Werrity, who had lived rent-free in Fox’s flat, had accompanied Fox on 40 of his 70 official engagements, attended meetings with foreign dignitaries and had used official-looking business cards which stated his was an “advisor” to Fox.

Fox resigned in advance of publication of an official inquiry’s report into the matter.

What a shame he can’t keep his mouth shut.

Cameron’s determination to ruin us all continues unabated – BBC

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David Cameron must think we’re all as stupid as his fellow Conservatives and that party’s most rabid adherents, if the latest BBC report is to be believed.

In it, he responds to comments from his Coalition government’s own Business Secretary, Vince Cable, suggesting the government could consider borrowing more – at, let’s remember, the lowest interest rates in British history – to inject some growth into the economy.

Cable’s remarks are eminently sensible – which is, of course, why Cameron is believed to be moving so quickly to counter them. The fact is that austerity never – ever – brought a country out of debt. Investment is the key. Investment needs money. If you don’t have money, you borrow it from someone who does. Then you pay them back – with interest from your profits. ‘Speculate to accumulate’, as the saying goes. It’s how most Conservatives and Tory voters made their money but Cameron – and his sidekick 0sborne, let’s not forget – inherited theirs and therefore, we may reasonably deduce, know nothing whatsoever about it.

Instead, Cameron will reiterate his insistence on following the ‘Starve the Beast’ policy that George W Bush used to such devastating effect when he was President of the USA, reducing a surplus of $128 billion to a deficit of $10.627 trillion within a few short years.

A decent definition of ‘Starve the Beast’ economic theory is that it is a fiscal strategy to create or increase existing budget deficits via tax cuts to force future reductions in the size of government.

This is clearly what Cameron and his cronies are doing – and the Liberal Democrats are helping them all the way, no matter what Cable says about it. It’s why they’ve borrowed more money in the last two and a half years than the Labour Party did in three terms of office (as a recent meme puts it).

And they will cut the machinery of this country’s government down to the marrow, for no better reason than their own personal enrichment and the fact that it will create huge problems for any government that follows them in 2015.

The BBC report contains excerpts of what Cameron was expected to say in a speech today (Thursday). These deserve interpretation, as their meaning is not entirely clear at first glance:

“I know some people think it is being stubborn to stick to a plan. That somehow this is just about making the numbers add up.” He’s setting us all up with a false premise. We don’t think he’s being stubborn; we know his real plan isn’t what he has been trying to sell us. It’s about cutting the state to nothing, impoverishing the vast majority of us in the process and enriching his cronies. This is why, crucially, the numbers don’t add up at all.

“The very moment when we’re just getting some signs that we can turn our economy round and make our country a success is the very moment to hold firm to the path we have set.” So the present moment, with the loss of our ‘AAA’ credit rating, high street shop chains dropping like flies and his own political party regularly being dropped to third place in by-elections, would definitely not be that time.

“And yes, the path ahead is tough – but be in no doubt, the decisions we make now will set the course of our economic future for years to come.” This is absolutely true. The decisions he makes now will set the course of our economic future for years to come. What a shame nobody seems able, or willing in the case of the Liberal Democrats, to stop him.

“And while some would falter and plunge us back into the abyss, we will stick to the course.” He is projecting the effects of his own actions onto his political opponents. He knows perfectly well that it is his course that will lead us straight to that metaphorical abyss – if he hasn’t pitched us over into it already.

The BBC article goes on to say that he will point to the creation of a million extra private sector jobs – a claim that has been debunked many, many times since he first made it. Private sector jobs have been created, but nowhere near a million of them! Also the terms under which people are being employed are appalling.

It is typical of the kind of ridiculous babble to which he and his lieutenants have subjected us for nearly three years now – a period in which our situation has never – not once – offered even the appearance of improvement.

This blog reported only a few days ago that Cameron had been put on notice by his own party – improve or lose the leadership.

The sooner those backbenchers follow through on this threat, the better.

For all of us.

Omnishambles, omnishambles, omnishambles

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Feeling tired? Don’t worry, Vince Van Winkle, we’ve got a cosy place in the Cabinet for you, next to Ken ‘Can’t Keep My Eyes Open’ Clarke!

Before the general election in 2010, David Cameron reminded us that Tony Blair had summed up his ambitions in three words, “Education, education, education”, then said he could manage his in three letters: “N.H.S.”

How wrong he was!

We now know that the correct three-word slogan would have been: “Omnishambles, omnishambles, omnishambles”!

Here’s three examples of Coalition government ineptitude that have fallen onto my desk during this morning alone.

1. The government is having to shred £350,000 worth of ballot papers for the Welsh police and crime commissioner elections after a late decision to print them in both English and Welsh.

There really is no excuse for this. I know for a fact that Labour and, I believe, Plaid Cymru were both pushing for bilingual ballots, months before now.

When Christine Gwyther heard the Home Office did not have Parliamentary approval for bi-lingual ballot papers and information to voters, she immediately took steps to rectify the matter, writing to Bryn Parry-Jones, the returning officer, who agreed to pursue it on an all-Wales basis. She told Labour’s Brecon and Radnorshire constituency party the story at its meeting in September, which was one and a half months ago at the time of writing.

The government says the cost will be met from the £75 million election budget. I find this unconscionable. People across the country are getting into terrible states of anxiety over how to afford an extra £20 or £30 a month due to benefit cuts (of which more in a moment), but this government is prepared to throw away hundreds of thousands of pounds because its members couldn’t be bothered to make a perfectly simple decision in a reasonable amount of time.

Shambles.

2. A senior Downing Street aide has quit working for David Cameron in order to join Wonga.com, the loan company that charges bizarrely exorbitant rates of interest – more than 4,000 per cent. This is according to Sky News.

Jonathan Luff has done this, allegedly, at a time when the Office of Fair Trading is trying to crack down on payday lenders and concern is high about the industry’s business practices. The question is whether the move will give Wonga inappropriate access to ministerial decision-makers.

I guess we’ll find out, if the issue mysteriously goes away in the immediate future, with no explanation.

Already, critics have denounced the move as a sign of what Conservative supporters are really interested in – not the good of the country, but the size of their bank accounts.

Shambles.

3. Finally, in an article on this very blog, I seem to have revealed ambiguities in the plan for the new, so-called “bedroom tax” that could add tens, if not hundreds of pounds to the cost for people renting council- or social houses.

It seems that it is unclear whether the amounts to be removed from housing benefit – 14 per cent for one extra bedroom, 25 per cent for two or more – are to be taken from the amount of benefit being paid, or from the total rent being paid on the property. One of my readers tells me that Cornwall Council has taken the latter stance, meaning a loss of £21 per week for the first spare bedroom, £29 per week for two – considerably more than the advertised average of £14 per week.

Social housing provider Bromford, on the other hand, states clearly that it is a household’s housing benefit entitlement that will be cut, which seems to make it clear that it is a percentage of the benefit, not the full rent.

One wonders whether the government will stir itself to provide a definitive answer before the new rules come into practice next April. I shall not be holding my breath in anticipation.

Oh, and households with students away from home for less than 52 weeks per year – exempted under the new rules – will find that Cornwall Council doesn’t see it that way, either. from the form letter: “If you have an extra bedroom(s) for children who don’t live with you full time, the Government will count this as a spare bedroom and your benefit will be cut.”

Omnishambles.

Bubbling under, we have the accusation against Business Secretary Vince Cable that he slept through the new Cabinet Growth Committee’s meetings, as he seems to know nothing about them despite being, as I understand it, the vice-chair.

Coming soon: Borishambles.