A few weeks ago, I wrote about East Riding of Yorkshire Council’s (ERYC) failed regeneration scheme in the seaside town of Bridlington. Since then, local residents have set-up a campaign group, Justice for Bridlington which we are happy to support.
Justice for Bridlington tried to contact all sixty-seven ERYC councillors this morning, asking them to sign this declaration. Forty-one councillors publish private e-mail addresses on the council’s website. All forty-one of them received a covering letter and a copy of the declaration to sign and return.
The remaining twenty-six councillors use official eastriding.gov.uk e-mail addresses. All twenty-six e-mails were returned as blocked. Justice for Bridlington is calling for more transparency and accountability in County Hall, yet ironically cannot contact councillors who use official e-mail addresses. Councillors appear to have no control over who contacts them or what lands in their inbox.
If the council thinks councillors are being spammed, there are always spam filters. To block e-mails completely highlights the problems that exists.
The story doesn’t end there though. Those councillors who have received their copy of the declaration, received the following message from Matthew Buckley, Head of Legal and Democratic Services:
Members may have received an e mail from an organisation calling itself
‘Justice for Bridlington ‘. Could I ask Members not to respond to this e
mail for now.
We are discussing an appropriate response.
This e-mail was sent despite the following request in the covering letter sent to councillors:
You are not obliged to reply to this letter, but if you do, we ask that you do so as an individual. A reply made jointly, by a political group, or via officers may imply that you are unable to fulfil your function as a councillor and/or that you are unwilling to engage with your electorate.
So there we have it. In trying to call those who are responsible for the regeneration fiasco to account, and in trying to campaign for more transparency in County Hall, Justice for Bridlington is prevented from contacting councillors who use official e-mail addresses, and council officers have tried to stop all councillors from replying and signing the declaration.
Is it any wonder why I’ve said in the past, democracy is dead in County Hall?
Refuse collectors and street cleaners are going back to work in the interim whilst they consider a new offer from the Brighton’s Green Council. It is hoped the council has done what is necessary this time to avoid a potential second week of strike action, however during the recent strike there was an interesting development.
Shop owners in some parts of the city such as George Street took matters into their own hands and cleared up the area surrounding their shops as it was having a direct impact on their bottom line. Those on strike reacted to this by saying that the shop owners were taking strike breaking action, but others such as Cllr Warren Morgan took a more pragmatic approach. Cllr Morgan went on record to say “I don’t agree that people sweeping up outside their homes or shops is strike breaking”.
So we actually had an interesting situation where not only did residents and businesses not receive a core service that they had paid for through taxation, but they were compelled to carry out that vital service themselves.
Anyway here is a something to think about for the future. If businesses are happy to clean up the area in which they operate to protect their bottom line, should they not get a discount in their Council Tax? Perhaps reduce Council Tax in the city so people have more spending power, and reduce business rates so that particular barrier to entry for small businesses is lessened, and then just let the shop owners take responsibility for the area in which they operate. This could be a move that via lower taxation could help spur an economic revival of shopping areas in Brighton, where currently too many shops stand empty.
In advance of the Comprehensive Spending Review, we can reveal how the Government could cut vast swathes of wasteful and unnecessary spending. A new online edition of the Bumper Book of Government Waste, published today, identifies potential savings to the tune of nearly £120 billion, a figure almost exactly equal to the current budget deficit. This equates to a massive £4,500 for each and every household in the UK - enough to give every family in the land a luxury holiday or pay their household energy bills nearly three times over.
Excellent work has been undertaken by the Cabinet Office’s Efficiency and Reform Group in terms of finding savings, but taxpayers’ cash has still been wasted in a number of ways, with significant sums ripe for being saved in many areas, including:
Our figure is almost certainly an underestimate. A rigorous assessment of the public sector efficiency commissioned by the European Central Bank found that if the UK’s bloated public sector were as efficient as that in the economies of countries like the US, Australia, and Japan, no less than £137 billion could have been saved in the last year.
In addition to the big ticket items, we have identified hundreds of examples of smaller sums being wasted. It is, however, all still taxpayers’ money and there is no excuse for waste, regardless of the amount involved. Among the culprits identified are:
Matthew Sinclair, Chief Executive of the TaxPayers’ Alliance, said:
“George Osborne must take the golden opportunity offered by the Spending Review to get the nation’s finances under control and ease the burden on taxpayers. The latestBumper Book of Government Waste shows that tens of billions of pounds are still wasted each year and there is an enormous amount of fat left in the public sector.
“If Ministers do something about it, they can give taxpayers a better deal and still provide the frontline services which people depend on the most. More money must be left in the pockets of struggling households who need it to support their own families and their own causes. They will get better value than any politician or bureaucrat.”
Commenting on this morning’s select committee report on the Severn Barrage, Matthew Sinclair, Chief Executive of the TaxPayers’ Alliance said:
“It is good news that the Committee has rejected the latest proposal for an enormously expensive Severn Barrage. It would be a woeful deal for the country and a terrible burden on families already struggling with their energy bills. Another major official study into the feasibility of the project would be a ridiculous waste of taxpayers’ money, so soon after the last one.”
Writing in today’s Daily Telegraph Matthew Sinclair argues that our complicated capital tax system needs reform. His article follows the release of our new research How to fix corporate taxes which is part of a set of papers that demonstrate the steps needed to introduce key recommendations from the 2020 Tax Commission final report, The Single Income Tax.
Executive summary and recommendations
Recommendation 1: Cut Corporation Tax
Recommendation 2: Abolish Capital Gains Tax
Capital Gains Tax should be abolished, with two main options:
Recommendation 3: Introduce a new single tax on capital income
Commenting on the launch of How to fix corporate taxes, Matthew Sinclair, Chief Executive of the TaxPayers’ Alliance said:
Much simpler, fairer and more competitive capital taxes would change our economic fortunes and end the grim slog of trying to make do as prices rise faster than your wages year after year. We desperately need to end the costly farce of taxing the same money two or even three times and instead impose a single tax on capital or labour income. In the absence of much needed strategic tax reform though, politicians should at least cut not only corporation tax but also capital gains tax.
The TaxPayers’ Alliance has today released a new video highlighting how the UK’s taxes on people’s wages are needlessly complex and obscure. Produced with the team from See what you mean, the video highlights how National Insurance is a second income tax in all but name.
Previous YouGov polling for the TPA has shown that many people are not aware of how much tax they actually pay. The video makes clear the real rates of tax people pay when Employee’s National Insurance and Employer’s National Insurance are factored in.
Basic: Employer’s NI 13.8 % + Income Tax 20 % + Employee’s NI 12% = 40.2%
Higher: Employer’s NI 13.8 % + Income Tax 40 % + Employee’s NI 2% = 49%
Additional: Employer’s NI 13.8 % + Income Tax 45 % + Employee’s NI 2% = 53.4 %
(See below for an explanation of the combined rates)
Polling has also shown that most do not understand the impact of Employer’s National Insurance, which effectively reduces their wages.
Last year the TPA set out how to abolish National Insurance by 2017, which would make the tax system simpler and more transparent. At the 2011 Budget, the Chancellor indicated a desire to merge Income Tax and National Insurance, which Mr Osborne said would be a “historic step to simplify our tax system and make it fit for the modern age”. Unfortunately, the Treasury has thus far failed to publish the work of the Office for Tax Simplification on this topic or come up with any solid proposals.
Matthew Sinclair, Chief Executive of the TaxPayers’ Alliance, said:
“Taxing the same income three times is a pointless complication which only benefits politicians trying to conceal how much tax people really pay. National Insurance has been nothing more than another Income Tax for years and additional redundant taxes mean higher administrative costs for businesses. The Government can and should merge them into a single tax which would be simpler, fairer and more honest.”
**Calculations** Employer’s National Insurance is added at the rate of 13.8% on top of gross salary. So if you’re paid another £87.87 of gross salary, the employer has to pay an additional 13.8%, which would be £12.13, That adds up to £100.
We are proud to present the seventh Town Hall Rich List, the Who’s Who of senior local government executives which details the job titles, full remuneration and many of the names of all local council employees whose remuneration exceeds £100,000.
Praised in the past by politicians on both sides of the House of Commons, the Town Hall Rich List remains the definitive guide to senior executive pay in local government, making it a vital tool for taxpayers wanting to judge which authorities are delivering the best value for money.
Since the first edition in 2007, the number of senior staff appearing on the Town Hall Rich List has soared. This is the first time that the TPA has reported a drop in the number on remuneration of more than £100,000, largely because of the considerable number of redundancy packages paid out in 2010-11, which increased total remuneration for that year. The welcome fact that many councils have made their data more accessible and transparent has also had an effect on this figure.
However, executive pay in many town halls across the UK continues to be insulated from economic reality, despite the urgent need to find savings and the fact that many councils claim that they have insufficient cash to fund frontline services.
The key findings of the research are:
Matthew Sinclair, Chief Executive of the TaxPayers’ Alliance, said:
“It is good news that the number of senior council staff making more than £100,000 a year is finally falling, although that may only be because many authorities have finished paying eye-watering redundancy bills.
“Sadly, too many local authorities are still increasing the number of highly paid staff on their payroll, some of whom are given hundreds of thousands of pounds in compensation just to move from one public sector job to another. Residents won’t be impressed if their council pleads poverty when it is demanding more and more Council Tax, only then to spend it creating more town hall tycoons.”
Matthew Sinclair, Chief Executive of the TaxPayers’ Alliance, gave the following reaction to this morning’s Queen’s Speech:
“It is great news that the Government has shelved plans for some of the cumbersome new regulations and expensive spending commitments that were rumoured before this Queen’s Speech.
“Sadly they are still planning enormous increases in the amount of money taken from British families and spent on often wasteful and corrupt foreign aid projects, but at least they are not writing that mistake in law. They are also pressing ahead with their great vanity project, a high speed rail line which is poor value compared to more affordable alternatives, but there is still time to reconsider that white elephant as well.The energy reforms are ambitious but misguided and will do nothing about the draconian targets and stealth taxes that are the real problem for consumers.
“Despite some important progress in this speech, ministers still have a lot of work to do if they really want to ease the enormous pressure on family budgets and create the simpler, fairer and more competitive tax system that they claim to be trying to achieve.”
At the Queen’s Speech on Wednesday, new laws will be proposed for the coming parliamentary year. Many of the laws reported to be under consideration will have important consequences for taxpayers.
The Government needs to choose. It can either ensure that taxpayers get better value and greater accountability from how their money is spent, or it can enshrine new wasteful spending and onerous regulations in law. We will be following the speech closely and making the case for taxpayer value to be the first priority.
· DO: Drop the plan to enshrine the 0.7 per cent aid spending target in law
· DON’T: Introduce a paving bill for High Speed Rail 2
· DO: Introduce a tax reform bill to abolish National Insurance
· DON’T: Pile new taxes on already overtaxed homeowners
· DO: Give voters the right to recall MPs who have let them down
· DON’T: Introduce minimum unit pricing for alcohol or plain packaging for tobacco
DO: Drop the plan to enshrine the 0.7 per cent aid spending target in law
The Government should not set an arbitrary target to spend a certain amount on foreign aid that ignores the changing needs of recipients; whether the money can be spent efficiently and controlled properly; the private generosity of taxpayers giving their own money; and the economic situation in Britain. Our 2009 paper Lost along the way: The cost of the UK’s international development programme showed how DfID was already spending large amounts on programmes where much of the money would not reach frontline projects.
DON’T: Introduce a paving bill for a new high speed rail line
Proposals for a new high speed rail line would mean spending well over a thousand pounds for every family in Britain and do not represent value for money. Many towns would see a worse service under the current plans and the economic case is based on flawed assumptions. Realising ministers’ promises for the effects of the line will create further significant costs for taxpayers. Three key TaxPayers’ Alliance research projects that have studied the likely effects of going ahead with the proposed new line: High Speed Rail, HS2 Capacity Analysis and The hidden costs of HS2.
DO: Introduce a tax reform bill to abolish National Insurance
The Single Income Tax, the final report of the 2020 Tax Commission convened by the TPA with support from the Institute of Directors, called for strategic reforms to create a much simpler, fairer and more competitive tax system. An early step that would ease the administrative burden on employers and make the tax system more transparent and honest would be to abolish National Insurance and merge it with Income Tax. Our recent paper How to abolish National Insurance shows how that can be done.
DON’T: Make home ownership less attractive with new taxes and ever higher stamp duty
The Government must resist calls for new taxes on property. Property taxes are already twice as high – as a share of GDP – in the UK as they are on average in other OECD countries (see page 12 of our Fiscal Factbook). Stamp Duty creates particular problems for first time buyers and growing families (for more detail, see The Single Income Tax, Section 6.2.3).
Matthew Sinclair, Chief Executive of the Taxpayers’ Alliance, said:
“The Government should use the Queen’s Speech as an opportunity to ease the burden on taxpayers struggling to balance their own budgets. To do that, ministers must resist the temptation to introduce eye-catching bills which more often than not involve commitments to spend other people’s money or introduce cumbersome new regulations. Instead they should seize important opportunities to put in place simpler, fairer and more competitive taxes and make sure the politicians spending the money are accountable to the people who pick up the bill.”
We can today reveal that a massive £1.1 billion was paid last year in Business Rates on empty properties, a rise of 19 per cent between 2009-10 and 2011-12.
This is the first time that a figure has been calculated for the amount collected in empty property rates since exemptions for empty commercial and industrial properties were abolished at the 2007 Budget. Prior to 2007, empty industrial properties were exempt from Business Rates and empty commercial properties were subject to extensive reliefs and reductions.
Now, apart from a short exemption period and extremely limited reliefs, full Business Rates are payable on all empty commercial and industrial properties. With the economic downturn making it increasingly difficult for landlords to find new tenants, this tax has had some devastating effects:
A number of senior members of the Coalition Government were vocal in their criticism of this tax on empty property while in opposition.
In government, however, both Coalition parties have failed to address the issue.
The report includes a figure for the amount collected in empty property rates by every council in England, Scotland and Wales over the last three years, with the totals region-by-region as follows:
Matthew Sinclair, Chief Executive of the TaxPayers’ Alliance, said:
“It is extremely unfair that property owners are being hit with enormous Business Rates on properties which are empty, with no rent coming in that they can use to pay the bill.
“There are elderly people who invested in a small commercial or industrial unit in the reasonable expectation that the rent would top up their pension. This new tax is ruining them. The rest of us lose out as the mere threat of having to pay rates on empty properties is discouraging people from putting money into new developments or refurbishing existing properties, which is undermining the prospects for economic growth.
“As the true scale of this ugly tax becomes apparent, Ministers cannot keep ignoring their own rhetoric in opposition and leave it in place.”
We have published our post-Budget briefing this morning, complete with graphical illustrations to complement its analysis of the Chancellor’s announcements.
The key findings are as follows:
The Chancellor of the Exchequer, George Osborne, announced a number of welcome measures to relieve the tax burden on struggling families in today’s Budget, including:
However, the TPA has warned that the Chancellor is still relying too much on complicated measures to help specific industries, rather than making fairer and simpler changes to the overall tax structure.
Reacting to today’s Budget, Matthew Sinclair, Chief Executive of the TaxPayers’ Alliance, said:
“George Osborne has announced welcome relief for people struggling with the high cost of living. The cut in beer tax, the freeze in fuel duty and the higher personal allowance will all ease the pressure on family budgets. Lower Employers’ National Insurance and Corporation Tax will also be passed on to workers in higher wages.”Unfortunately, the great limitation of this budget was that it relied far too much on complicated targeted reliefs instead of tax cuts across the board. Simpler, strategic tax reforms that reduce the overall burden would be fairer and do more to produce the stronger economy Britain needs.”