Posts tagged ‘Ed Milliband’

Poe’s Law conundrums (Millipede Jr’s 2014 Conference Speech edition)

Is this a typical Gruniad sub-editing fail or have they just repeated the briefing notes verbatim:

The Labour leader’s big six goals are designed to restore a lost faith in the future. They are:

  • Ensuring as many school leavers go on to apprenticeships as go to university.
  • Help working families share fairly in the UK’s wealth.
  • Meet the demand for new homes by doubling the number of first-time buyers from the current 200,000 a year to 400,000.
  • Halve the number of low paid – defined as those earning two-thirds of median earnings – from 5 million to 2.5 million.
  • Create a million more hi-tech green jobs in a bid to overhaul the number of Germans and Japan.
  • Restore the NHS by integrating health and care services, ensuring joined up preventive care to keep the healthy out of hospital.

Consequences

SSE also said in yesterday’s statement that it would be investing less over the next five years.

An SSE spokesperson attributed this to “uncertainty in the underlying [regulatory] framework”.

I’m sure that the SSE spokesperson wasn’t alluding to Millipede Jr’s proposed freeze in energy prices. Honest.

On the proposed NMW increase

In an interview with the BBC yesterday George Osborne said that he would like to see above inflation increases in the National Minimum Wage (NMW), potentially increasing the rate for those aged 21 and over to £7/hour. Whether this was a pre-emptive strike or a panicky reaction ahead of Millipede Jr’s speech on the cost of living today is left up to the reader to decide based on their own particular biases.

The bare numbers (courtesy of Listen to Taxman) for someone doing a 37.5 hour week in the 2013/14 tax year are as follows:

£6.31/hour £7.00/hour £ Change % Change
Gross Pay 12,304.50 13,650.00 1,345,50 10.94
Income Tax 572.90 842.00 269.10 46.97
Employee National Insurance 546.78 708.24 161.46 29.53
Employer National Insurance 635.97 821.65 185.68 29.20
Nett Pay 11,184.82 12,099.76 914.94 8.18

Increasing the NMW to £7 would (in this tax year) make the employee £914.94 better off, the government £616.24 better off and the employer £1,531.18 worse off.*

Yet increasing the thresholds for Income Tax and all types of National Insurance to £12,304.50 would leave the employee with an extra £1,119.68 in their pocket, the employer with £635.97 per employee to spend on something else and a reduction in the amount taken by government of £1,755.65 – which would no doubt be offset by a reduction in the need to hand out quite so much in in-work benefits (and, potentially, reduce the admin overheads involved).

Not that it will happen though.

*Obviously this assumes that nobody loses their jobs because their labour isn’t worth the increased amount because at that point the employee and the government are both worse off…

Unforeseen consequences

Millipede Jr is a miracle worker.

Yes, really.

As a result of his speech yesterday, and barring iDave saying something utterly insane in his conference speech next Thursday, I will, if I find myself living in a Labour/Conservative margin seat come the 2015 General Election, hold my nose, grit my teeth and do something I never thought I’d do again: vote for the Conservative candidate. I shall do this with the (admittedly slim) hope that my vote will, in some way, help stave off the possibility of a Labour government lead by Ed Milliband by reducing the number of seats won by that party.

May Zeus have mercy on my soul.

That 10% tax band proposal

The members of what passes for the Labour Party’s Brains Trust (no laughing, please) have finally, possibly, maybe, made some marks on that blank piece of paper and come up with a policy. Not a new one though but a rehash of an old one: a 10%* tax rate.

The details provided are sketchy but the press is reporting that it would apply to the first £1,000 of taxable income, in contrast to the previous incarnation which applied to the first £2,500.

However, whilst I am very much in favour of governments stealing less money, this ‘policy’ is about as pointless as when Millipede Sr and Dave Prentis called for the Living Wage.

As a result of this policy, basic rate taxpayers** would retain an extra £100 of their salary each year. Oh, be still my grateful heart!

The current government, as useless as they are, have raised the personal allowance (PA) from £6,475 in 2010/11 to £9,205 in 2013/14 – an Income Tax (IT) reduction for basic rate taxpayers of £546 a year.

Raising the PA to £12,070.50 (37.5 hr week at the National Minimum Wage) would save everyone a further £573.10 in IT alone.

Sorry Eds but this policy can only be described in one way: #fail.

* Or 35% once National Insurance is factored in.

** No doubt the threshold for the 40% IT band would be reduced by £1,000 at the same time.

Language difficulties

Last Friday the leader of the Labour Party (Millipede Jr for those who might have forgotten) stood up in Tooting to give a speech on immigration.

As part of this verbal diarrhea he said that:

…he promised the party would in future help immigrants learn English. It will also consider barring immigrants from some public sector jobs unless they can speak the language properly.

And later he clarified his point via the BBC:

“What I’m talking about today is also the issue of integration, which is when people are here, how do you ensure that they are part of British society?

“That’s about learning English, it’s about making sure that you don’t have slum housing where you have maybe ten, 20, 30 people all packed in a house working in a local factory or somewhere. That’s bad for them and bad for their neighbours – and also making sure that we don’t have workplaces that are segregated.”

Whilst I suspect that barring those with a poor of standard of English from jobs is probably against some piece legislation (EU perhaps and not applicable to non-EU passport holders? Someone will no doubt correct me!) I actually agree with the general point that he is trying to make about wanting immigrants to be able to speak the language.

Without checking with various colleagues who have taken up citizenship over the last few years, I seem to recall that part of the process was an English test. IIRC the Australian cricketer Stewart Law, when asked at the time of his taking up British citizenship how his English was, said something along the lines of ‘You are kidding, right?’ (I’m undoubtably paraphrasing that!)

No such requirement is necessary for those who don’t plan to take up this option but Millipede suggesting (quelle surprise!) throwing more stolen money at the problem by giving immigrants langauge classes.

And that is where he and I part company.

As a fan of open borders (boo hiss etc)* I have no problems with people moving wherever they may wish to. However learning the lingo should be the responsibility of the immigrant and paid for out of their own pocket. The State can assist in this process by not publishing government paperwork in anything other the English (also Welsh, Gaelic etc in the appropriate areas) meaning that if you want to interact with the bureaucracy – a sadly inevitable part of life – then you either have to be competent in the local language, ask a friend who is (at least) bi-lingual or hire an interpreter. Seeing as how the latter is likely to be a costly option long-term and friends are likely to start thinking ‘learn the bloody langauge, will you?’ after a while being able to communicate will become necessary.

A solution which saves trees, cuts down on government expenditure and ensures people have to be motivated? Sounds like a good one to me. :)

* I would however scrap national benefits in favour of a return to something like Friendly Societies,

National Minimum Wage v’s Living Wage

The National Minimum Wage (NMW) is back in the news with Millipede Sr and UNISON boss Dave Prentis calling in yesterday’s Observer for it be raised to match the ‘Living Wage’ (LW) rate of £7.20 (or £8.30 in London) an hour.

As Tim Worstall pointed out once again yesterday, this could be achieved just as easily as not taxing anyone doing a full-time job at NMW rate for those over 21 (currently £6.19/hour).

The figures (courtesy of Listen to Taxman) for someone doing a 37.5 hour week in the 2012/13 tax year are as follows:

NMW LW
Gross Pay (£) 12,070.50 14,040.00
Income Tax (£) 793.10 1,187.00
National Insurance (£) 537.42 773.76
Nett Pay (£) 10,739.98 12,079.24

As can be seen the difference between gross income at NMW and nett income at LW is all of £8.74 (less then a half a penny an hour) and this figure will no doubt be even lower in the 2013/14 tax year once the 0% Income Tax (IT) band rises to £9,205.

Raising this threshold, as well as those for National Insurance (NI), to £12,070.50 would hand every employee on the NMW an automatic pay rise of £1,330.52 without costing their employers a penny. Sure, it would cost the treasury the same amount (more once employer’s NI is taken into account) but I suspect that that can be offset against the reduction in tax-credits.

Upping the NMW to match the LW however would mean that the treasury steals an extra £901.23 (£393.10 in Income Tax, £236.34 in employee’s National Insurance and £271.79 in employer’s National Insurance) per employee.

As someone who would rather the government had less revenue to waste, the former strikes me as the more sensible approach.

It also means that private sector employment in those areas of the country where the median wage is less than the UK median (generally everywhere outside of the big cities and their suburbs) should not continue to suffer at the expense of public sector employment.

It would, of course, make more sense if (whilst we have them) the NMW and LW wage as well as public sector salaries were set on a more local basis given that the cost of living varies across the country. We already have this working in London in the form of the ‘London Weighting’* so why not for those outside of the suburbs?

UPDATE: Millipede Jr has said he’d like to see the LW set at £7.45. Using the same methodology as above the figures come out as:

  • Gross – £14,527.50
  • IT – £1,284.50
  • NI – £832.26
  • Nett – £12,410.74

The difference between the nett figure here and the gross at NMW is £340.24 – or approximately 17.5p per hour.

* Somewhat of a misnomer I feel as it was (when my mum was based there) being paid to those working for local government in Basildon. Basildon, for those fortunate enough to have never heard of it, is a 1960s new town outside of the M25 and about 30 miles from the eastern edge of the City.

Patsy Pasty

Of all the tax changes in the budget which the politicians, press and public could have got themselves worked up about – cutting the top rate, freezing grannies allowance, the ongoing process of pulling people into high rates, the marginal rates levied on those earning between £50k and £60k with children, the ever increasing duties on petrol, alcohol and tobacco – it is changing of what is charged VAT with respect of hot, take-away food which seems to causing the government the most trouble.

The ludricous lengths that that our elected wastals and the copy-and-paste artists in the MSM have gone to over the whole matter is laughable in the extreme. Thanks to them we have had to put up with, amongst other things, iDave and various cabinet ministers attemting to remember if, where and when they last ate a pasty (and the MSN chasing these recollections up); Millipede Jr (with his likely Brutus in tow) going to Greggs for lunch as part of a staged photoshoot; and supposed ‘quality’ newspaper The Telegraph resorting to live blogging the entire fiasco.

Fankly, if the whole business means anything, it is as

  1. yet another reminder how pathetically out of touch the inhabitants of the Westminster village really are,
  2. showing how woefully ignorant and stupid the so-called reporters who are paid to fill up the output of the media really, and
  3. a demonstration of how utterly stupid VAT is.

As I’m certain my readers are aware, VAT is an EU tax and thus subject to the whims of Brussels and the rent-seekers to be found in that city. It is therefore no surprise to learn that the reason for impsition of the ‘pasty tax’ is somewhat more than the bland statement Osborne made to parliament during his speech:

We will also address some of the loopholes and anomalies in our VAT system.

[…]

Hot takeaway food on high streets has been charged VAT for more than twenty years; but some new hot takeaway products in supermarkets are not.

A fuller account of the reasons why the children supposedly running the country are in the mess that they are in comes from Richard North of EU Referendum:

Enter Manfred Bog who, back in 1994 was running three mobile snack bars. After a series of disputes with the German tax authorities, Bog in 2006 fixed upon one particular issue, that 70 percent of his sales were being assessed for standard rate of VAT, while the remainder only attracted the lower rate of five percent.

The German authorities here were arguing that the larger proportion of the food sold was consumed “on the premises” (i.e., under a shelter provided by Bog) and, therefore, the trade was a “service” rather than the supply of goods – thus attracting the higher rate of VAT.

We should not detain ourselves with the finding of the German financial court, the Bundesfinanzhof. Down that path lies madness. Suffice to say that the case was joined by others, including a firm called CinemaxX, arguing the toss about popcorn sales. Again, the service/supply of goods argument was in the cooking pot. And then there was Mr Lohmeyer, with his snack stalls and a swinging grill, plus – of course – Fleischerei Nier. Don’t even go there.

Cutting to the chase on this bundle of cases, the judgement on 10 March last year ruled that the supply of food or meals freshly prepared for immediate consumption from snack stalls or mobile snack bars or in cinema foyers is a supply of goods rather than service – as long as the supply of services preceding and accompanying the supply of the food were not predominant.

Ostensibly, this did not apply to the UK – or so HMRC said at the time. Yet the Fish Fryers Federation and others disagreed, because the essence of the ECJ judgement was that they were supplying goods (as in foodstuffs), not services. And as the UK zero rates food, they were thus salivating at the prospect of a mega-refund.

“Ahah!”, said HMRC batting away such insolence. The fish fryers are caught either way. Their tax category – devised uniquely by the UK – includes “hot take-away food” and well as catering services. It matters not whether it is food or service, VAT still applies, regardless of Bog.

And there gripped the cold, mindless jaws of the VAT Sixth Directive, of which the ECJ had so cruelly reminded us. To their horror, HMRC have confronted their worst nightmare. If the fish fryers are selling hot food rather than services, and have to charge VAT on it, so does everybody else who sells hot food.

That’s right, Osborne had no choice in the matter.

Can we leave yet?

“Sugar and spice and all things nice…”

Well, well, who would have thought it? It turns out that the ball-breaking harridan Harriet Harman we all know and love hate is just a front put up by the real Harriet who is, apparently, so meek and mild that she needs protecting from all the nasty men.

I mean, what other conclusion can possibly be drawn from revelation that this year’s Labour Party conference will have a women only session entitled ‘What Women Want’?

Before you feel that I am being too harsh on Mrs Dromey (if that is at all possible) it is seems that it is not just poor Harriet who feels this way as the session came about after ‘what is described as an “uprising” by female members’.

The session will be led by the senior Labour female figures of Harman, Yvette Cooper (aka Mrs Balls), Baroness Royall and Baroness Scotland and whilst the agenda is as yet unknown they are canvassing opinion from the female membership and expect that:

There will be formal resolutions based on suggestions from female members, who are being invited to the platform to put their case on education, childcare, the economy and the NHS, as well as party rules.

Presumably because none of these issues matter at all to the male members of the Labour party?

It will not be entirely women only though as Labour leader Ed Milliband will be allowed in, with a source telling the Independent that “Ed will be there as an honorary woman”. What such an ‘honour’ says about Ed’s masculinity I leave to the speculation of reader…