Remploy : U-turn required

We have to hope that enough MPs have the guts to challenge the Government's decision on this. The coalition needs to re-think. Once again this Government demonstrates its deaf ear to public opinion. Do they no longer have sensible civil servants saying  'That would be very brave, Minister',  or are they just ignoring them? 


The argument seems to be that the Government should no longer subsidise Remploy at up to £25k per place. On the same day that the Remploy announcement was made, I heard Government Ministers defending the U.K.'s aid spend of £7,800,000,000. This is a categorically different level of expenditure compared to the £68,000,000 invested in at least 2000 jobs at Remploy. It's not so much the money, it's the priorities that the spending decisions expose that is the real issue. The coalition just doesn't get people with disabilities just as they don't get those communities that were devastated by the de-industrialisation of the 1980's. They have to understand that they will have to take the country with them if we are not to be any further divided,have any further inequality.


The solution to the Remploy position is simple. Treat the existing workforce, the people, as the first priority and put arrangements in place for them. Some of the Remploy factories could be turned around by more innovative management.  Some settings would benefit from a partnership with other companies. Some individuals could be supported in more open employment. The task would be to get every existing member of staff into an appropriate setting. The transition would take a lot longer but everyone would recognise that the Government is putting people first. Just as it puts its overseas aid commitments first.


If the Government doesn't u-turn on this then we have another issue, like the NHS bill, that will lose them the next election.

Mansion Tax

The LibDem idea of a mansion tax is the craziest coalition policy since the NHS bill. There are two main objections.


1. As with the old rates system you can have someone who appears property rich who is income poor who will then struggle to pay. I wouldn't want to see someone who has lived in the same house for 80/90 years being evicted because they can't pay the tax. 


2. The rich will simply avoid paying this tax. They already avoid paying stamp duty when they buy these £1M+ homes. What on earth makes Vince Cable think they are going to fail to find an avoidance mechanism for a mansion tax.


I think I can now be officially categorised as cynical. I think the LibDems know that and it's just cover for agreeing the removal of the 50% tax rate. Or at least flying a kite to see if the public go for it. 


Pathetic!

Unemployment heads for 3 million.

It's not exactly a surprise that things have got this bad. In fact, it's completely predictable. From the start the coalition has talked strongly about public sector cuts and the mantra of austerity. (Interesting to note, though, that austerity doesn't extend to their own public spending with £400,000 wasted on renting fig trees for Portcullis House.) But the public sector cuts were to be offset by private sector growth. The trouble has always been that there has never been a strategy for creating those jobs. What kinds of jobs? In what sectors? In what locations? How supported? If the public sector redundancies really are about cutting out waste, then those jobs won't be replaced in the private sector. And there are many functions carried out at present by the public sector that just couldn't generate a profit. at least not without dropping down wages and conditions, or increasing public purchasing budgets. Probably both.


The absence of any kind of growth strategy is really disturbing. It's fantasy economics and fantasy politics. I wrote in this blog back in October 2010 that government 'will also have to deal with the unfinished business from the 1980's of how to restore exporting industry, and what to do about  all those communities that have lost the reason for their existence'. In contrast, their policy seems to be to cross their fingers and hope for the best.


This is a little PS. This morning I saw three young men emerge from the building that houses the local probation service and NHS addiction service. I don't know which they had been visiting, possibly both. All three were pasty, emaciated  figures stumbling along in their matching Burberry baseball caps. (How Burberry must hate that : its a sort of anti-marketing to have your stuff adopted by your least welcome demographic.) One had crutches. Quite a common site around this building. It's because they damage their ability to walk by injecting in their groin. 


Anyway, it got me thinking on what it would take to get that three into work. They have probably never worked. They are drug users. They probably have a criminal record. Who will ever employ them? The most worrying thing is that, if not already then soon they will have kids. Kids they will ignore but kids who will, in 20 years time, also look like these three : permanently unemployable. And what is the strategy for breaking that cycle? I suspect that, once again, it's cross your fingers and hope for the best.

NHS REFORM

I'm so glad to be living in Scotland and out the way of these unnecessary and wrong NHS reforms. It has, incidentally, been a very long time since there was, as Labour likes to say, one NATIONAL health service. Things have been very different in Scotland and England for a long time. In fact some of the resentment that fuelled the rise of the SNP derives from the last time the Conservatives were in power when unacceptable policies were imposed : poll tax, de-industrialisation, introduction of markets into the NHS. That's why the Tories still have only one seat in Scotland.


The current NHS reforms are hard to understand. Why are they doing it? David Cameron said that the NHS would be safe in their hands and that there would be no 'top-down re-organisation'.  While we are used to politicians telling lies, this is a breathtaking example of promising one thing to electors and then, once elected, of doing the opposite. Whatever else it is a gift to Labour. You can be sure that much will be made of it in the next general election campaign. And its the most important issue for many voters. I saw the NHS described as the closest we have in the UK to a state religion. For a PR professional the Prime Minister has a very uncertain touch.


So, why are they doing it? I think its in their DNA and its unfinished business. When the Thatcher government came to power in 1979, they did have a mandate to privatise and got busy on coal, steel, rail etc. They were then keen to extend this approach to the NHS but found that it was such a shambolic organisation in business information that there was no basis for either separating out elements of service (because everything was so integrated - generally regarded as a good thing) and because nothing was properly costed. No one, famously, could tell Ministers how much a hip replacement cost.


All of the re-organisations that have taken place in the intervening years have been attempts to resolve these structural  problems. The NHS is now divided up into business units. And everything is costed. But these changes have largely been to the detriment of the NHS. The rot set in early. When they found that they couldn't privatise in 1979 the then government started to prepare the NHS for a future privatisation. They commissioned Roy Griffiths, then the Chairman of Sainsburys, to report. He found an organisation without adequate information and cost systems and recommended the introduction on general management.  


I think Griffiths was probably correct and I don't agree with those who think his approach was to turn the NHS into a supermarket. The NHS in those days did need to modernise systems and management but the scale of the changes has gone far beyond anything Griffiths could have imagined. Part of the problem is that so many NHS managers are not really managers, they are at best administrators,  and the sub-divisions of NHS business units are so unwieldy that integration, once in the bloodflow of the NHS, is now a full-time demand on those administrators. Another problem is that anytime anything becomes an issue civil servants advise Ministers to introduce another role to determine policy, monitor implementation and interpret results i.e. someone just like them. That's why there are so many civil servant type roles in the modern NHS.


So, Conservatives always want to privatise. It's the Conservative way. And they are completing the work they were frustrated in back in 1979. They are completing Keith Joseph's dream.


Whatever you think of it, it will lose them the next General Election.

BONUS vs. PUBLIC MOOD

Observing the backlash against those on top pay having to pay attention to the public mood by refusing bonuses. One top analyst says that big pay and bonuses are necessary to provide motivation, which will lead to success for the country. 

I was thinking about all those who manage to do a good job without such additional financial motivation : bus drivers responsible for the safety of their passengers, nurses, home helps, teachers, technicians..........complete you own list.

And those who do need to be 'motivated' : investment bankers, financial traders, management consultants, hedge fund managers.........

No wonder Adam Smith backed off his original perception that 'greed is good' and concluded that social responsibility was important.

We are all in it together!

THE POSSIBILITY OF REDEMPTION

Redemption? What does that have to do with welfare reform? Patience. Patience. One side of welfare reform is spending. The other side is Government income. All will be revealed.


While many have relished the downfall of Fred Goodwin, other, more careful, voices have taken a more considered line. Alistair Darling, always someone to listen to, asks : What about the others? Many top bankers and other speculative investors received honours. Many are now known to have taken outrageous risks with other people's money. 


And Darling and others have warned against the too easy emotional spasm of vindictiveness against the demonised individual. It feels too much like mob mentality. And too much like a neat piece of political manipulation : it wasn't us guv, honest, it was them bankers over there. And Fred has fallen into being the scapegoat for the whole financial crisis.


Individuals can and do make mistakes. If they remain a danger to the public they get locked up. Sometimes forever. But that's not Fred and the other bankers. John Profumo famously made amends for his indiscretions (sufficiently serious at the time to bring down a government) by doing voluntary work in the East End. All prisoners are, at least theoretically, regarded as having the potential to be rehabilitated. I remember helping a friend, who had completed a long prison sentence for violent crime,  to complete a job application. I told him (and I know that many would disagree with this advice) to declare every crime, every conviction, every sentence, including those regarded as spent in terms of the Rehabilitation of Offenders Act. The rationale was that he accepted what he had done, that it was now behind him, but that he was making a fresh start. The employer, a responsible national charity, took the measure of the man and took him on. Some years later I had the great privilege of completing his "fit person" reference to enable him to take charge of a home for people with disabilities. He deserved it. He had paid the price for his mistakes. He was now rehabilitated. Redeemed.


Fred Goodwin is 53. What is he going to do now? I have a suggestion. Why not offer the possibility of redemption? Why not get Fred, and the other errant bankers, to volunteer their services to the revenue. They know all the scams. Set them to be poachers turned gamekeepers. They could retrieve billions from top tax evaders and avoiders. Let them chase down tax havens, loopholes, 'products'.


It can't be a reward deal. The knighthoods can't be restored. The obituaries are always going to major on their part in the financial crisis. But, like Profumo, they could have their equivalent to 'voluntary work in the East End'. They could use their considerable skills and experience for the good of the country.


If I were Fred, I would be offering myself now. For the good of the country. And so should all the others. They know who they are.

UNFAIR! Part 1 in an indeterminate (but probably quite lengthy) series

It is reported that George Osborne has decided not to pursue Vodafone for a tax bill of £6billion. That's £6,000,000,000 when we are told that every £ counts. The BBC reported that Boots now declares its profits in low tax Switzerland despite making its income predominantly in the U.K. How much is that lost to the U.K. economy? Apparently around £90,000,000 a year. And we can be sure that other big companies are similarly failing to believe that "we are all in it together" by doing the same.

Just as there are those skilled at avoiding/evading tax, there are those skilled in the manipulation of the benefits system. I have just come across the first story I have seen of adaptation to the Government's new approach. One mother is complaining that she will have to return to work when her child reaches seven. Her friend tells her she just needs to get pregnant every sixth year and then she will always have a child under seven and thereby retain her benefit entitlement for the foreseeable future.

The unfairness will fall most heavily, and probably most quickly, on those who have paid their taxes and have expectations that services will be available when they need them. Those who are long term sick or disabled, and I mean genuinely so, will soon be experiencing a very hard time. Many will lose basic benefits because the systems put in place will have difficulty in making the correct distinction between those who cannot work and those who choose not to work. Local authorities will have to cut back hard on their social care budgets and will be removing services from many needy individuals. One London borough has already told one service user that she will have to wear incontinence pads rather than have the assistance with toileting that she has been receiving.

Over the past twenty years, when faced with potential spending constraints, local authorities have tended to raise charges rather than cut services. Social care has been particularly affected by this approach. I always tried to find scope for reasonable increases in charges, rather than cut back on services, when I was advising Councils. But the justification for social care charges was the additional income that service users were receiving from disability benefits. Reflecting changed circumstances and reducing charging systems for services is unlikely to figure very high in local government budget discussions now taking place.

So, many of those who are sick or disabled will experience a TRIPLE WHAMMY:

1. Loss or reduction of benefits income
2. Loss or reduction of services
3. Continuing high charges not reflecting these losses or reductions

So, big business will be O.K. 

Benefits manipulators will be O.K. 

But those who are sick and disabled will bear the impact of the cuts. They are the real squeezed middle.