Can the road to Kansas deliver economic results?
Jul 2014 25

The Daily Telegraph’s Jeremy Warner says that Britain should follow Kansas and dramatically reduce taxes, citing the economic benefits that the state is starting to enjoy. Mr Warner highlights evidence that:

both private-sector growth and job creation have improved sharply relative to national averages. Rates of private-sector job growth are virtually back up to the national average, having significantly lagged behind them in the past. Kansas is also experiencing record levels of company registrations. Many of these will eventually lead to start-ups and extra jobs.

Experience, in other words, is already beginning to mirror what other low-tax states achieve. If we take the 15-year period between 1998 and 2013, the 50-state average for private-sector job creation was 8 per cent. Yet for those states such as Texas, Florida and Nevada that don’t impose income taxes at all, the rate of growth was 18.3 per cent, against 5.6 per cent for those that do. Tax competition, it seems, works in practice just as you might expect it to in theory.

Although the coalition has implemented some welcome tax cuts (especially Corporation Tax and raising the personal allowance), there have also been deep failures. A serious cost of living crisis and many other problems show that the current fiscal plan of increasing the tax burden and reducing spending is not enough. Mr Warner rightly asserts that reducing taxes can allow more manoeuvre for wealth creation in the economy, sharpening incentives and encouraging more investment, growth and employment.

News today that the economy is at its biggest ever level is welcome, but it isn’t quite cause to cheer the Chancellor that it might at first seem. The GDP figure misleads as when expressed per head it is still lower, signalling that we are all still considerably less well off than we were before the recession as Jeremy mentions “GDP per head has still got some way to go before it attains past levels.

On top of this, the Government also “managed to borrow more so far this year than last.” This means that despite the healthy GDP figures, the Government is still struggling to pay its way and future taxpayers will be left to foot the bill.

So George Osborne should not feel too satisfied with the latest figures, especially falling real terms incomes mean that whilst the economy may officially be better, the people are poorer and the government are trying to squeeze more money out of the public.

The idea that tax cuts are necessary is by no means a new one, of course. Our 2020 Tax Commission highlighted a much simpler system that will benefit the economy where spending and tax are both reduced to 33 per cent of GDP, down from 42.5 per cent for spending and 37.7 per cent for taxes this year. Maybe it is now time to follow the path set by Kansas which displays encouraging signs on private-sector growth and job creation. We need to look at dramatically reducing taxes and getting the government and citizens back on a sound financial footing to ensure prosperity for all.

Avon and Somerset need bobbies on the beat, not flower power
Jul 2014 25

Avon and Somerset Police have spent £5,000 on a flower garden, in an effort to reduce local crime rates. The idea is that a communal area will reduce anti-social behaviour. As a result, the regenerated part of St. Andrew’s Park becomes another area of questionable policies in Bristol, after the mayor’s proposal of “Residents’ Parking Zones”  . While the new garden is no doubt pleasant, it’s effectiveness in cutting down on crime is clearly an area of doubt. This sort of item is for local councils, not police budgets.

As our Chief Executive Jonathan Isaby told the Telegraph, we worry that police might spend more of our money on similar woolly schemes, which shouldn’t be their responsibility. Local police budgets should be used on more effective, proven methods. The need to focus on core responsibilities is especially acute when Her Majesty’s Inspectorate of Constabulary has made it clear in their recent report that forces will have to cut spending in the coming years. Many forces have already dramatically reduced the number of ‘bobbies on the beat’. How can these police forces spend that same money on such oblique methods?

Nobody can object to the flowers brightening up the area. But the money should come from the appropriate place, preferably a local fundraising scheme. It seems that the police are wasting their time and taxpayers’ money on something that shouldn’t concern them.

The War on Waste rolls on
Jul 2014 08

Yesterday marked a busy day on the War on Waste Roadshow, stopping off to spread the word four times as we made our way north to Newcastle.

A quick drive up the A19 from our hotel in Scunthorpe saw us arrive in Hull just in time for Andy Silvester, our Campaign Manager, to do a live interview for BBC Radio Humberside before the rest of the team were joined by Andrew Allison, the TPA’s former grassroots co-ordinator. In glorious early morning sunshine the various placards, signs and flags we’ve packed into the back of the minibus looked very good indeed.

From there it was on to York, setting up outside the famous Betty’s Tea Rooms, where we were joined by a number of activists to spread the word. Residents were less than thrilled with the revelation that new furniture at the County Council offices cost some £1.4 million.

A short drive took us to the North East and the charming market town of Yarm, where the wasteful spending of half a million pounds on “improving” the parking on the High Street did nothing to aid our pursuit of a parking space! Once finally installed, the highest number of supporters and activists so far helped us hand out leaflets and raise awareness of issues in Yarm and across the North East. Despite the increasing drizzle, we soldiered on to Newcastle with a brief leafleting stop at the foot of Grey’s Monument.

Fingers crossed for another successful day – we head off for Carlisle in ten minutes!

 

A sign of progress, but much more to do
Jun 2014 11

The Government’s Efficiency and Reform Group this week revealed progress in tackling wasteful spending, finding an additional £14.3bn in savings for the 2013/14 financial year. This builds on savings of £3.75bn (2010/11), £5.5bn (2011/12) and £10bn (2012/13).

Cabinet Office Minister Francis Maude and his team should be commended. Over previous decades, wasteful spending has skyrocketed. The public sector has too often spent over the odds, blowing taxpayers’ money on ridiculously expensive stationery, on poorly-managed contracts, on an army of consultants, on far too much. That money should have instead been spent on essential services – or simply not spent at all, and left in the pockets of taxpayers.

So news of successful moves to tackle inefficiency is welcome. Finally, some common sense is being applied to running central government.

But for this to translate to a better deal for taxpayers, this can only be the opening battle of a war on waste. Taxpayers worked 148 days this year just to cover their tax bill. Yet they still find wasteful government spending contributing to our enormous public debt, and eliminating waste is the first step in lowering people’s taxes across the country. That’s the thinking behind our War on Waste Roadshow, taking our message of transparency and accountability to 30 towns and cities across the country.

There is no doubting that, as Francis Maude himself has admitted, there is plenty more to do. An attitude that abhors waste and chases efficiency has to be the norm rather than the exception throughout the public sector if the Government is to deliver the value for money that taxpayers deserve.

The Queen’s Speech: A last chance for a radical vision
Jun 2014 03

This Wednesday, Queen Elizabeth II will take to the throne in the House of Lords and deliver the last Queen’s Speech of this functioning, if occasionally fractious, Parliament. In it, the Coalition will set out the legislative programme for its last year of power before next year’s uncertain election. They have a chance to deliver a lasting legacy for taxpayers – but will they?

We particularly hope to see the Coalition deliver on one of their first promises – to enshrine a “right of recall” in law. Currently, voters have little recourse when they feel an MP has let them down other than to circle the date of the General Election in their calendar. Giving the public the right to petition for a ballot when they’re aggrieved by their MP’s behaviour would be a fantastic way to increase the accountability of our elected representatives. Voters across the world, who have been given the right of recall, have acted sensibly and appropriately, only using it on rare occasions. There is no reason to fear British voters having the same power. Concerns that it would create “kangaroo courts” – most notably expressed by our Deputy Prime Minister – only reflect how far the gap has grown between the political elite and the people they represent.

On a similar note of accountability and transparency, if Britain is to reduce a £1.3 trillion debt burden, it will have to wage war on waste across local and national government. The Coalition’s insistence that government at all levels publishes spending details online has meant that waste is more obvious and easier to identify, and that transparency is vital if we are to hold politicians to account for how they spend our money. However, the Coalition won’t be in power forever, and a future administration may not share its commendable commitment. A short bill, to enshrine in law that all departments, quangos and local authorities have to continue publishing how they spend our money, would guarantee that transparency in the long term. Similarly, there has been unwelcome speculation that the Coalition might weaken the Freedom of Information Act; this should be avoided.

Whilst these measures would encourage transparency in how our representatives spend and act, the Coalition should also do more to introduce transparency into the tax system. A merger of National insurance and Income Tax wouldn’t cost the Treasury anything, but it would allow hard-working Brits to see quite how much of their money is being taken by the taxman.

The Coalition has a last chance to set out a radical vision for a more accountable political class and a more honest tax system. Let’s hope they take it.

You can read a fuller list of the TPA’s proposals for tomorrow’s Queen’s Speech here.

 

TaxPayers’ Alliance online Debt Clock re-launched – and it’s scarier than ever
May 2014 02
The TaxPayers’ Alliance has this morning re-launched its online Debt Clock. Although there is a welcome economic recovery, our Debt Clock offers a stark reminder of the urgency of Britain’s national debt crisis, and the need for politicians to wage a War on Waste to get spending under control.
The national debt continues to rise at a startling rate:
  • £4,344 per second
  • £260,654 per minute
  • £15,639,269 per hour
  • £375,342,466 per day
The national debt is the total amount of money the UK Government currently owes. This is different to the annual national deficit, which is the amount of money the UK Government spends in excess of income. Each year we run a deficit, the national debt grows. Britain has been running a national deficit for the past 14 years.

It’s not merely the huge scale of the national debt that is a cause for concern, but also the rate at which it is increasing. The national debt will rise by £137 billion this year alone, and by 2016-17 it will hit a total of £1.5 trillion.

To put this frightening borrowing into context, the rate of increase in the national debt would have::

  • Paid for the London 2012 Olympic Games in just over 3 weeks
  • Covered the cost of the Scottish Parliament building in little more than a day
  • Ensured the entire Transport budget was settled in 9 weeks
  • Funded the construction of 183 Wembley Stadiums this year
  • More than covered the entire NHS budget this year
Jonathan Isaby, Chief Executive of the TaxPayers’ Alliance, said:

“The deficit may be coming down but we shouldn’t let that distract us from the rapidly increasing national debt. Somebody has to pay these bills, and that means this terrifying debt burden will fall on the shoulders of future generations of taxpayers. Politicians must get serious and wage a war on waste, instead of borrowing from our children and grandchildren to pay for things we can’t afford today.”

War on Waste hits Lewisham
Apr 2014 25

TaxPayers’ Alliance activists came out in full force and battled the winds last Saturday (19 April) to campaign for Council Tax cuts in Lewisham. Out on the streets of Lee, armed with hundreds of leaflets and a strong team of dedicated activists, our petition received lots of attention with signatories from all over the borough.

Many felt that despite Council Tax hikes over the last decade, they had not seen an increase in the quality of their local services, and could not see where their taxes were being spent.

It is also in great contrast with councils in Hammersmith and Fulham and Wandsworth, both working to cut Council Tax. Many people in Lewisham were astounded that the average Band D household in their borough pays £1, 359 a year, whilst Wandsworth residents pay nearly half this amount. Council Tax has been reduced by 20 per cent over the last eight years by Hammersmith and Fulham Council, whereas Wandsworth Council has frozen council tax for the fifth time in six years, with a band D property owner now paying just £682 a year.

One of our activists also found that:

Some residents who had recently moved from Wandsworth were furious that they pay so much more in Council Tax for services that are worse.

The news of the campaign in Lee spread as far as the East Midlands, with Nottingham based blogger Elliot Johnson covering the local event by the news of ‘wasteful councils’.

The War on Waste continues to attract widespread attention. Taxpayers deserve to know exactly how their money is spent. We’re not stopping at Lewisham though; our campaign will continue to fight for a better deal for taxpayers all over the country.

NHS wastes £46m on spin doctors, diversity advisors & a Third Sector Environmental Sustainability Lead
Apr 2014 01

We can today reveal that the NHS wasted over £46 million last year on 1,129 unnecessary jobs in areas such as public relations, the EU and “green” staff. The money spent on these positions  could have paid for 1,662 full time nurses.

Click here for a link to read the full report
Click here for the full data by region and highest paid

The startling new figures have been exposed by Freedom of Information (FOI) requests to every NHS organisation in the UK. The total cost of NHS non-jobs is likely to be an underestimate given that some trusts failed or were unable to respond.

Key findings:

  • The NHS employed at least 826 public relations staff at an estimated cost of £34 million.
  • It employed at least 165 equality and diversity staff at a cost of more than £6.8 million.
  • It also employed at least 86 ‘green’ staff costing around £3.5 million.
  • West and South Yorkshire and Bassetlaw CSU employed 36 public relations staff at a cost of over £1.4 million.
  • Guy’s and St Thomas’ NHS Foundation Trust employed 22 public relations staff at a cost of almost £1.1 million.
  • Leicestershire Partnership NHS Trust employed six equality and diversity staff.
  • Barts Health NHS Trust employed an NHS EU Office Director, an EU Office Manager and a Senior EU Policy Manager at a combined cost of more than£210,000.
  • In 2013, six NHS employees received total remuneration of more than £100,000 for an unnecessary job.
  • Imperial College Healthcare, Northumbria Healthcare and Oxford University Hospitals employ a Trust Energy Manager, an Estates Energy and Sustainability Officer and an Energy Manager respectively. However these trusts were found to have significantly overpaid for their energy in previous TPA research.

Roles identified in this research include:

  • Mersey Care NHS Trust’s Third Sector Environmental Sustainability Lead.
  • South London Healthcare Trust’s Energising for Excellence Delivery Lead.
  • Royal Free London NHS Foundation Trust’s Car Park Sustainability Officer.
  • University Hospitals Bristol NHS Foundation Trust’s Administrator of Green Travel Facilities.
  • Mid Yorkshire Hospitals NHS Trust’s Diversity and Inclusion Lead.
  • Black Country Partnership NHS Foundation Trust’s Productive Leadership Facilitator.
  • Homerton University Hospital NHS Foundation Trust’s Art Curator and Programme Manager.
  • Leeds Community Healthcare NHS Trust’s Equality and Diversity and Human Rights Manager.
  • Gateshead Health NHS Foundation Trust’s Energy Management Manager.
  • 5 Boroughs Partnership NHS Foundation Trust’s E-Communications and Social Media Officer.

Click here for a link to read the full report
Click here for the full data by region and highest paid

Jonathan Isaby, Chief Executive of the Taxpayers’ Alliance, said:

“Taxpayers expect the health budget to be spent on real doctors, not spin doctors. The NHS employs far too many people in jobs that do nothing to deliver frontline patient care. It’s time for health chiefs to launch a war on waste and ensure the NHS budget is spent on on patients rather than squandered on bureaucrats.”

TaxPayers’ Alliance response to the Budget
Mar 2014 19

Reacting to the Budget, Jonathan Isaby, Chief Executive of the TaxPayers’ Alliance,said:

“The Chancellor has announced some welcome relief for taxpayers struggling with stretched budgets. Measures such as the higher personal allowance, the freeze in fuel duty, and abolition of the alcohol duty escalator will all ease the burden on hard-pressed families. It’s also good to see savers finally being rewarded after being overlooked for too long by successive governments.

“However, George Osborne has no room for complacency. His failure to reform Stamp Duty is a missed opportunity and it is deeply regrettable that yet more taxpayers are likely to be dragged into the 40p Income Tax band.”

Commenting on key areas mentioned in the Budget, he added:

Failure to ease the burden imposed by Stamp Duty
“It’s extremely disappointing that the Chancellor failed to address the increasingly punitive burden which Stamp Duty is imposing on home-buyers. More and more people are being hit by higher rates, with the ludicrous slab-rate structure seriously skewing the property market.”

Abolition of the Alcohol Duty Escalator
“This is a good day for ordinary drinkers across the country. It is also a good day for the many small businesses that they support. The Call Time on Duty Campaign has consistently argued that the Alcohol Duty Escalator was bad for consumers, for business and for the economy. We applaud the Chancellor for taking the decision to get rid of it. Cheers!”

Investment Allowance
“Doubling the investment allowance to £500,000 a year is a significant and worthwhile move to encourage investment but it only strengthens the case for more fundamental reform of corporate taxes.”

Income Tax Personal Allowance / Thresholds
“Raising the Personal Allowance again next year will lift more taxpayers out of tax and cut the bill for everyone paying the basic rate. While higher rate taxpayers up to £100,000 will not be hit again, the 40p threshold remains much lower than it where it would have been if it had increased over time with earnings. The 45p rate should also have been abolished.”

Air Passenger Duty
“It’s fantastic news that the Chancellor has scrapped the higher rates of APD, meaning an end to the most extortionate levies for holidaymakers, families visiting relatives overseas and those flying abroad on business.” 

Closing the Deficit
“The national debt is still increasing at an alarming rate and an entire generation is being saddled with crippling debt interest payments. The quickest way to bring down the deficit would be to wage a war on waste in the public sector so that public spending is brought back under control once again.”

Savers
“British savers will be relieved that not only has the tax-free ISA allowance increased, the system has been drastically simplified too.”

Letter to The Times: Successive justifications for HS2 have failed to convince
Mar 2014 17

The TaxPayers’ Alliance has co-signed the following letter which has been published in today’s Times:

Sir, There are few more iconic images of the recent storms and the flooding which devastated so many thousands of lives than the Great Western Line at Dawlish collapsing into the sea, cutting off the main rail route to the South West of England.

This underlines the stark choice in determining priorities for investment in Britain’s transport network — between investment in increasing resilience, developing regional transport connections and relieving the plight of the thousands forced to stand on trains each day, or ploughing ahead with a London-centric high-speed line with a dreadful business case which connects just four cities.

Successive justifications for HS2 have failed to convince, so its supporters are asserting that the West Coast Mainline is full to capacity and HS2 is needed to relieve it. Yet Network Rail’s latest figures show that intercity trains are running at just 52 per cent full into Euston station at peak times, and that Euston is one of London’s least busy termini.

With the Treasury predicting that HS2 will cost £73 billion — £1,500 for each adult in Britain — as well as causing huge environmental damage, it is clear that the time has come for a comprehensive review of the UK’s transport priorities, and where, if at all, HS2 fits with this.

Hilary Wharf, HS2 Action Alliance;
Baroness Bakewell;
Natalie Bennett, Green Party;
Sir Keith Bright, ex London Regional Transport;
Dr Eamonn Butler, Adam Smith Institute;
Nigel Farage, UKIP;
Sir Christopher Foster, Network Rail;
Jonathan Isaby, TaxPayers’ Alliance;
Denise Jeffery, Wakefield Council;
India Knight;
Ruth Lea, Arbuthnot Banking Group;
Dr Madsen Pirie, Adam Smith Institute;
Mary Portas;
John Prideaux, Intercity and British Rail;
Roger Salmon, ex Rail Franchising;
Alexei Sayle;
Chris Stokes; ex Strategic Rail Authority;
Martin Tett, Bucks County Council;
Sir Andrew Watson, CPRE Warks;
Sir Barney White-Spunner, Countryside Alliance;
Baroness Wilkins;
Paul Wilkinson, The Wildlife Trust

 

George Osborne must declare a war on waste and cut taxes in a Budget for taxpayers
Mar 2014 13

The 2014 Budget provides the last meaningful opportunity for the Chancellor to help hard-pressed taxpayers before the General Election.

In next week’s Budget, the Chancellor should:

  • Declare a War on Waste to cut out unnecessary spending
  • Cut taxes to stimulate investment, create jobs and ease the cost of living
  • Reform taxes and reassess the structure of government

These three areas are covered in the TaxPayers’ Alliance submission to HM Treasury in advance of the Budget. You can read our full submission here.

Key recommendations include:

Waste

  • Public sector pay and pension reform including an end to the gap between public and private sector pay.
  • An end to the NHS ring-fence with a reduction in NHS spending in line with other departments.
  • Scrap the HS2 white elephant and use some of the money saved for better value rail and road projects.

Taxes

  • Cut both employer’s and employee’s National Insurance to 11 per cent.
  • Abolish the alcohol duty escalator.
  • Cut the main rate of Corporation Tax to 20 per cent in 2014 instead of 2015.
  • Cut Fuel Duty by 5p per litre.
  • Freeze the Carbon Price Floor at 2014 levels.
  • Cut Stamp Duty Land Tax using at least one of the three options proposed in our paper Stamp Duty – a counterproductive tax.

Reform

  • Extend the use of dynamic modelling used in last year’s Autumn Statement to all fiscal policy announcements. Dynamic analysis using the HMRC CGE model should be required for all fiscal policy changes announced by the Government.
  • Rename National Insurance to properly reflect its true function as a parallel system of income tax on employment earnings.
  • Set about departmental reform by abolishing the Department for Culture, Media and Sport along with the Department for Business, Innovation and Skills, transferring some responsibilities such as museums, universities and training to other departments.

Speaking in Advance of the Budget, Jonathan Isaby, Chief Executive of the TaxPayers’ Alliance said:

“The Chancellor is in the last chance saloon when it comes to helping taxpayers before the next election. If he wants to ease the burden on family finances and secure economic growth then he has to cut waste and cut taxes in this Budget. Promises of help after 2015 will not be enough – he must take this opportunity now to deliver a Budget for taxpayers.” 

The morning after the Budget, the TaxPayers’ Alliance and the Institute of Economic Affairs will bring together a cross-party panel of experts to assess its political and economic implications. Click here for more details

Councillors will no longer be able to claim pensions
Mar 2014 11

Responding the  news that councillors are to be removed from the Local Government Pension Scheme (LGPS) , Jonathan Isaby, Chief Executive of the TaxPayers’ Alliance said:

It is wrong that councillors were ever able to sign up to the pension scheme for local authority employees. They receive an allowance to represent their community, not a pay packet, and treating them as council staff will only have served to skew their priorities and their place in the system of democratic accountability. Ending councillors’ entitlement to a local government pension will not only save taxpayers’ money, but also remind them that they are there to represent the views of their residents to the council, not the other way round.

Our  research has shown i n 2010-11 4,548 councillors were enrolled on the LGPS – a number that has grown significantly in the last couple of years.

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