POLITICS CORNER

[Stanley]

Even senior Tories are attacking Ossie on the donations cap. (LINK)

Meanwhile, in another part of the forest, investors are questioning the ploy of throwing unlimited money at the EU banks so that they can in effect borrow unlimited funds to buy government bonds (lend them money) in order to keep dodgy economies afloat. The bottom line is that German money is being used to support the debt that caused the problem in the first place. They are asking what happens in three years when the debts are due for repayment. A roll-over and more of the same? Quite rightly they point out that this is an expensive way of buying time in the hope that an increase in growth will produce enough money to draw down the debts. Problem is of course that in order to qualify for the loans, dodgy economies have to accept austerity and cuts which reduce there capacity to encourage growth. The investors point out that at best this condemns millions of people to economic misery with no assurance that it will eventually improve.
I seem to remember howls of rage when some commentators forecast at least ten years of falling incomes and austerity. It looks as though they were dead right, indeed, ten years could be over-optimistic.
Let's not forget who it was who allowed the banks to get us into this position. The administrations who, over the last fifty years, allowed deregulation of the banks. Incompetence allowing greed to flourish. No wonder the spin doctors are doing all in their power to distract us.....

[Stanley]

Word is that Dave is not happy as he arrives back from his Far Eastern sojourn. No wonder! The biggest problem they have (in their narrow view) is how to get out of charity gate without doing a U-turn. Another trivial item thrown up to add to the smoke screen is the proposal to fine parents of truants by withholding money from their benefits.
I know this is stating the bleeding obvious but I realised this morning that we can't escape the conclusion that the Tory element of the coalition has, rooted in their DNA, the concept that there is an underclass that is dragging the economy down and pert of the way out of our economic mess is to erode their capacity to extract money from the state. Sorry to be so simplistic but it needs stating every now and again.
Ernst and Young forecast a miserly 0.4% growth figure for 2012 and point out that this is totally inadequate to drag us out of depression. Technically we escape the double-dip but in reality this flat lining is depressing investment and there is the hidden danger that as manufacturing firms hoard cash instead of investing their assets are deteriorating and the reserves are lying idle in the banks doing nothing. No comfort for Ossie there.....

[Stanley]

Listened to Danny Alexander this morning 'explaining' the charity cap but ending up by leaving the door open. My interpretation is that they are going to avoid the U-turn by starting an interminable 'consultation process with the stakeholders' and allow the whole initiative to die the death in the long grass.

[Tizer]

I haven't paid much attention to the tax & charity rumpus and can't see why there isn't a simple arrangement where any tax paid to charity is subtracted from your taxable income. If a man has income of £1000,000 a year and chooses to give £900,000 to a (proper) charity then he should be taxed as if his income was £100,000. If he gives £990,000 to charity then he would be taxed as if on £10,000 income. Or is it that the government is more concerned about diversion of tax revenue into charity revenue? Obviously, we have to be careful that the charity is genuine, but surely that should be checked when a charity is registered and at intervals thereafter. If other wheezes are being employed to reduce the man's tax burden and they are illegal then that's a separate issue and shouldn't be muddled up with the charity payment issues. Or am I completely off track on all this and missing the point?

[Whyperion]

Thats the current situation.

Of course linking with Stanleys Comment , these charities for the relief of the poor are only perpetuating the underclass and should be eliminated into getting all fit and heathly ( ie those whom dont fail the work capability test - you walked through the door , you can work ) into any kind of paid employment ( preferably 24/7 as this will result in economic growth ). While the rest of us with asset wealth can get all our flunkies to bring in FOC all our needs from the acreage of gardens , farms , etc.

[Stanley]

Tiz, like all these matters we only get the headlines. There have been dark hints about 'charities in Eastern Europe' recycling donations back to the donor and knowing the ways of the world it would amaze me if this didn't happen from time to time. However, I suspect Tory DNA has kicked in here and there is more of enhancing the tax take at the expense of the charities than simply going for the dodgy charities. A general clamp down is a bad way of addressing individual cases.
When I was setting charities up I had to deal with the Charities Aid Foundation because they acted as the watchdog and they were tough cookies! I don't know what the mechanism is now. CAF did a series of snap audits of existing charities as well and issued reports on them. I don't suppose they have the funding or staff to scrutinise anything more than a representative sample.
The increase in the selective inflation index has come as a bit of a surprise to the government and the Bank of England. Of course it is being described as a 'blip' but I'm not too sure about that. The figures before March were distorted by the massive discounting that had happened on the High Street and it may be that there is an underlying upward trend that everyone has missed. One thing is certain, the general rate of inflation is higher than the rate of increase in incomes, result.... less disposable income and lowering of the standard of living.

[Whyperion]

Cited higher prices for bread, cereals, meat, fruit and vegetables in particular.
Not unexpected given the increases in transport costs with fuel price rises , and the general increase through later part of 2011 as world prices for
basic foodstuffs and animal feed increases.

[Whyperion]

National polls show Labour at around 48% of intended vote in respect of local elections , not surprising given colation policies , but surprising given the lack of credible policies or even announcements from Labour leadership.

Gordon Brown was the first to raid charities - the impact of tax credit withdrawal on dividends from companies hit their investment income significantly , followed by increases to employers NHI contributions , Tories hit them with the rises in VAT , which for charities is not recoverable and so is a cost. The offset of whole of charity donations against Income Tax and other taxes ( and the allowed uplifts in some instances of govt adding 10% through things like gift aid / payroll giving / covanants at various times ) have been means of offsetting some of these spin off consequences.

[Bruff]

For God knows how long, the largest party not in Government has been known as The Opposition. By definition, its job is to oppose and as such they are under no obligation at all to come up with 'what they might do' or 'explain themselves' until the time is judged right. This has held for years and practised by all Opposition's I can remember. For some reason, this is lost on the current Government (as well as many commentators, I might add) as they seem to think their job is to ask what the Opposition will do rather than get on and explain what they are going by way of governing, which also by definition actually the job of Government.

I had not one clue the detail of the last Opposition's policies until prior to the last election, which is just as well as I expected them to hold the last Government to account through opposition..

Richard Broughton

[Whyperion]

Not helpful as opposistion in this media age , but it does serve as diverting away from governments mistakes and attempts by government to blur the realities. The real opposision is (some) of the media. For party politics we really do need a (reasonable){workable} alternative view on much put forward , explaining the deficiencies in the govt view in a clear and non self-serving manner.
unfortunatley with local elections the party in power tends to make a complete mess of things , but the two main alternates are not much better. (SNP in scotland possibly an exception ).

[Tardis]

I wonder if the current government have any policies at all, being a coalition and all.

Certainly it isn't bright for HM Opposition to be leading on positions which are diametrically opposed to positions they held just a couple of years ago when in government. Certain volte faces don't tend to go down very well as it looks like opportunistic hypocrisy

[Tardis]

Local Politics:

The language used by Cllr Whipp on the Lib Dem leaflet that came through my door seems to suggest that Ken Hartley is a second choice candidate to the one who lost out last year to Cllr Purcell. He's not that bad, to be damned by feint praise

[Whyperion]

UK politics :
Labout could be honest and say they held views that they thought were popularist and would appeal to the city and other institutions , but on reflection they were wrong and it is time for socialist views to take forefront to deliver a fairer society with equality of opportunity for jobs , education , access to health care , reasonable , affordable pensions and a taxation policy that encourages enterprise whilst ensuring that earnings in the UK have the correct amount of UK tax paid.

Labour could have formed an english coalition , but were held back by minoritity parties from NI , Scot and Wales , ( and Labour leadership would not have compromised with LibDem - perhaps they should have ).

[Stanley]

"VAT , which for charities is not recoverable and so is a cost" Wrong, Many charities are set up as 'Companies Limited by Guarantee' and as such can register and reclaim VAT on expenditure.
Teresa May gets in more deportation trouble. She was warned by journalists that there was a discrepancy between the date the Home Office civil servants had given her and that used by the Court of human rights. It was even mentioned by the defending barrister in court on Tuesday. When a journalist queried the date with the Home Office they checked and said that midnight on Monday was correct. It would have been a good idea to check with the court of human rights. Simples! It looks as though the problem was pressure from TM to show a positive attitude and failure to do proper checks. Whatever the reason, it's a mess and once again raises the question of competence inside government.
Officially the unemployment figure has fallen slightly but embedded in the figures are some disturbing trends. More women unemployed and the highest total for 25 years. More people abandoning the search for non-existent jobs and taking part time work. No way of telling how many of the jobs created actually pay a living wage or have an element of security. Historically unemployment tends to fall as summer approaches because of recruiting for seasonal jobs. There are many reasons to question the health of the employment market.
Too simplistic to attribute faults in government policy to 'politicians'. The problem is the quality of those who are in politics. How many regard it simply as a career path and how many are there as conviction politicians with firm principles? There is a noticeable lack of what we used to call 'statesmanship' where personal and Party feelings are put on one side in the pursuit of what is best for the country. The Coalition is a good example, the major driver is obviously Tory DNA despite the efforts of the LibDems.

[Whyperion]

Stanley , I was over simplifying , Charitable Activities of a non-trading nature are VAT exempt and input VAT cannot be reclaimed. This is different from the trading activities of a charity , which are rated to the appropriate rate of VAT for the service or product and the normal reclaim rules apply. Special rules may also apply to certain health and research commissioning of some charities.

At one time trading activities of a charity were recommended / required to be in a Ltd Company with the charity owning all the shares and deed of incorporation specifing that profits after investment were only to be covananted to the charity, these rules were changed a while back and charities can provide both charitable activities and trading activities in the one entity , which can take the form of a company limited by guarantee , or other incorporated entity - by charter or statute for example or in any other legal format the charity is endowed or the trustees chose.

The legal format of the charity makes no difference to its VAT status , it is the what the activities are deemed to be, indeed if a charity makes only VAT exempt supplies of goods or services , normally input VAT cannot be recovered , but special rules apply if disabled / infirm persons are the receipents of the supplies.

There are further rules that state that some supplies for certain charitiable purposes are Zero Rated. Crudley , and not comprehensively , things used for the relief of the infirm are Zero Rated, things for the relief of the poor are Standard Rated, Art and Museums have Standard Rated supplies but a schedule of named entities can have the VAT paid by them re-imbursed by HM Treasury under a process outside of the VAT returns.

The 37 pages of VAT notice 701/1 provide information , but they are not comprehensive and refer to further special exemptions and when they do or dont apply , particulary relating to eduction, training and provision of buildings.

[Whyperion]

Re-listening to Cameron's explanation of the proposed treatment of Income Tax Relief on Charity Giving. It looks like the idea might be that the donor makes the net payment to charity , is assessed to income tax on his income at the appropriate rate/s and pays the tax to HM Treasury. The Charity then makes a claim to HM Treasury for the balance of the tax to be paid to them. This is currently much the system for Gift Aid , but that is only reclaimed by the Charity at the Basic Rate of Tax (I dont think there is an further reclaim avalible at the present time ), but for the individual this process increases the amount of the basic rate tax band by the amount of the donation/s. The checking of this is all done on declarations and this is a weakness of the system - unless every claim is checked. There was further abuse of the system with certain tax payers allegedly gift aiding shares in companies to charities , but the shares turned out to have nil value to the charity, but this was investigated and changed about 24 months ago.

So it looks like more red-tape involved but will result in the headline increase in percentage rate of tax paid by individuals , and , other than increased administration costs , leave charities no worse off. Of Course there could be a bit of tax simplification , allow all charities to claim Gift Aid relief at the 40 or 45% band rather than the basic rate of income tax, but that might cost the treasury too much.

[Stanley]

See this week's PE for some interesting examples of the misuse of charities.
Teresa has had a dusty answer from the Court of Human rights. The application was in time and it will be decided by the court in the 'next few months'. I doubt if they will be rushing to get the Coalition off the hook as they have a backlog of about 150,000 cases. It's also fairly certain that Abu Quatada will be doing everything he can to embarrass the government. I wonder if he's on Legal Aid?
As usual PE is full of good investigative reporting but one employment-related snippet in particular caught my eye. When the Local Government Association forecast 140,000 job losses in 2011 due to the cuts Eric Pickles attacked them and accused them of scaremongering. The actual number for 2011 was 214,000. Nice to see someone is keeping track and reminding us of the government's double-speak.

[Whyperion]

Less employment in local government , sounds good , at this rate the deficit will be nil , but it will take an eternity for ones letters into the local council to get answered. Are these numbers actual job losses or the change in number of filled and unfilled job posts , with part of the difference transfer of job roles to foundation schools etc and other quasi public service providers that are not directly paid by local authorities.

http://www.pendletoday.co.uk/news/local ... -1-4466846

[Stanley]

The point I was making was that Eric Pickles vilified the Local Government when it was obvious he had no idea whether the figure was right or wrong. Many of the job losses in public services were posts held by women, the main reason why there are more women unemployed than at any time in the last 25 years. I doubt if they are analysing the reasons for their job loss. The raw and manipulated 'unemployment total' we are presented with each month is massaged to enable it to be used as 'a barometer' of how the economy is faring. This is the basic flaw. They should be collected and analysed to give a clear picture of the problems the workers are facing so that steps can be taken to alleviate what used to be called 'the condition of the poor'. Nothing in the figures indicates wage levels, security or the effect on total family income. In the second of his great studies of Poverty,Seebohm Rowntree carefully interviewed a large cross section of the population of York and showed that one of the major causes of poverty was low wages. It's a damning indictment of our society that a hundred years later, if the same survey was done it would almost certainly produce the same result. Whenever I see the figures I remember what Harold Wilson once said "If a person is unemployed as far as they are concerned it is 100% unemployment". I was never a great fan of Harold but just for once he got it right. How many politicians see the figures as an index of eroded quality of life and misery rather than a handy indicator of how their policies are doing? There is another problem building up, the increase in youth and long-term unemployment and the number of jobs that pay only the minimum or below. Further, there is a slow erosion of the conditions of employment. Many low paid jobs are flat rate, they pay no premium for overtime or unsocial hours. We were far better off 50 years ago when most low paid jobs were subjected to the regulation of the Wages Boards. Guess who abolished them...
Unemployment is a social ill, not a political football.

[Stanley]

More embarrassment for the government as a leaked document reveals that due to the cost of fitting catapults to our phantom carriers, a cheaper and less effective aircraft may be purchased. See this LINK.
Ossie comes under attack from his colleagues for donating £10million to the IMF as part of the doubling of funds available for global loans. Do you ever get the feeling that there is no real money left in the system? It all seems to be the dreaded 'credit'. I begin to wonder whether I'll see any improvement in my lifetime. Very depressing.

[Whyperion]

A criticism of local government is that there were too many non-jobs paying inflated salaries. The increase in unemployment is also matched by an increase ( greater in part-time work ) in total employment. Certainly there does not seem to be an equitable distribution of money with and the small discretionary spend seems to be severely reduced.

[Tardis]

Pendle has lost positions, and yet most of the rest of the staff are on 3 day weeks. Less sorting out a problem, and more likely to compound them. So that could be why if you phone on a Monday, you might not get a reply until Wednesday.

It is an omnishambles

[Bradders Bluesinger]

Murdoch Snr. is due before Leveson on Wed.
......wonder if he will mention Coulson , in passing ?

[Stanley]

No Brad. I suspect his main ploy will be "nobody ever told me". I never read classics but the Labours of Hercules didn't escape me. The story of the rot at the heart of journalism in general and Newscorp in particular reminds me of the cleansing of the Augean stables. Problem is that from reports of even more arrests we don't even know the size of the problem yet and when we do, we will only be shown the tip of the iceberg.
The local elections loom and party 'literature' drops through the letter box. Latest offering for the Craven Ward is from the Tory aspirant, Suzanne Langtree. What strikes me is that there isn't a single word about her principles, opinions or aspirations. It is simply a list of highly questionable 'benefits' the Tories here and in Preston have conferred upon us. They saved Silentnight and created 100 jobs (Actually Batley plant was closed with over 100 job losses and the work transferred to Barlick). She has no opinions about the supermarket. Protecting our environment by opposing wind power at Yarlside is projected as a triumph, 'protecting the drumlins') not a word about the necessity for alternative power generation or what route she supports. They are against dog muck. LCC is looking after our local highways by proposing to resurface one back street and six sections of pavement. In other words some minor maintenance, not a word about the fact that about 25% of the gulley grates in the town are blocked or the phantom grit-spreader during the icy spell. Her final shot is a graphic showing that it's a two horse race in Craven, Labour can't win. I think she might find that it's a bit more complicated than that. It will be no surprise to me if there are some quite major swings in the voting.

[Stanley]

Re. the above. The French elections seem to be bearing out the point that recent events are influencing voters.