Saturday, 8 December 2012

Starbucks hit by UK Uncut protests as tax row boils over

Activists stage a series of sit-ins amid concerns that the firm's decision to pay the Treasury £20m over two years misses the point

Anti-tax avoidance protesters have targeted UK branches of Starbucks, attempting to turn them into women's refuges and crèches, saying that the company's unilateral decision to pay £20m to the Treasury over two years is missing the point. The coffee chain faced a backlash from customers when it emerged last month they had received 3bn in sales over 14 years yet claimed to have made a loss in Britain each year, vastly reducing its corporation tax bill.

The campaign group UK Uncut has organised 45 protests to pressurise the government to clamp down on tax avoidance and roll back cuts to public services. A UK Uncut spokesperson, Anna Walker, said that 1,000 people attended 45 sit-ins across the country.

At Starbucks' flagship store on Conduit Street in central London about 40 activists and six children were threatened by police with arrest for aggravated trespass and – after a brief discussion – the protesters agreed to leave. At Vigo Street in London's Mayfair, about 60 protesters gathered among customers sipping lattes and herbal tea, chanting: "If you don't pay your taxes we'll shut you down."

The protests are taking the form of sit-ins, designed to highlight the impact on women's services by transforming Starbucks branches into spaces that reflect those being lost due to the government's deficit-reduction measures.

Anna Walker stressed it was not targeting Starbucks staff, but highlighting the impact of the government's austerity measures on the most vulnerable. "This is not just about Starbucks and tax avoidance," she said. "That's just the tip of the iceberg. The government is not only refusing to tackle tax avoidance, but it's dismantling public services because it loses £25bn a year to it. People are incredibly angry when they see multinational companies getting off scot-free when they are the ones feeling the pinch."
On Thursday, Starbucks UK managing director, Kris Engskov unilaterally announced that the coffee company would pay £10m a year over the next two years. Starbucks came under fire earlier this year when it was revealed that it had paid only £8.6m in tax since it opened its first store in the UK 14 years ago. In that time, the coffee chain has made £3bn in sales yet has claimed it has made a loss in Britain every year. In October, HMRC said a total of £32bn had been lost to tax avoidance in the past year, an increase of £1bn on 2010-11.

Words: The Guardian
Pictures: Getty Images

Monday, 3 December 2012

Social enterprises and charities can't thrive in toxic public sector markets

The Shadow State
Peter Holbrook writes about the findings and ambitions
of Social Enterprise UK's new report

Decades of outsourcing by successive governments now means that £82bn, a third of spending on public sector commissioning and procurement, is spent with independent providers. Accelerated by recent policies, the health and social care act, the work programme and welfare reform act, this is predicted to rise to £140bn by 2014. But with the majority of contracts going to large firms and their shareholders, we're witnessing money moving out of the public realm and being turned into private wealth. The consequences of this are serious for both society and the wider economy.

The Shadow State provides evidence that, in the drive to maximise shareholder profit, sub-standard public services are being delivered by private firms in areas where it really matters – in care for children, the elderly and the disabled. As these companies seek to cut costs wherever they can, we're seeing staff wages being driven down and councils having to pick up the bill, whether in housing benefit or, in the longer term, great swathes of people who can't save for their retirement. In effect, taxpayers are subsiding multinational firms who are simply not paying their way.

At the same time, there is mounting evidence that some social enterprises and charities are being squeezed out of public service markets. Civil society organisations with a social mission in their DNA, which put people and communities first, and that reinvest their profits to improve the quality and number of services, are not faring well. Social enterprises and charities can't thrive in markets that have become toxic. The result is a lack of competition, leaving commissioners with little choice of provider.

Yet we have a once-in-a-generation opportunity to change the direction of travel. The public services (social value) act is throwing commissioners a lifeline to contract for community wealth, not private wealth. The culture of commissioning is such that councils are too often expected to make decisions based on lowest cost rather than 'whole community' prosperity. They're understandably following the lead of their peers – across the country, councils are opting to commission from private firms which vow to provide services at low prices. The danger is that when social enterprises and charities disappear, large private firms will put their prices up, and commissioners, service users and taxpayers will be held to ransom.

We are calling on government to strengthen the social value act. It's due to become law in January, it had the backing of the social enterprise sector and cross-party political support, and it has the potential to create more open markets. The legislation should help create a more level playing field for social enterprises and charities to bid alongside private sector providers by making sure that the additional 'social value' (social and economic well-being) they create is taken into account when contracts are drawn up.

Multinationals and other big businesses can't be blamed for gravitating towards the UK's public service markets – despite all the cuts, there is still a lot of money changing hands. Some services are perhaps best provided by expert providers in the private sector. But many of the services at stake are dealing primarily in human relationships, and economies of scale and shareholder value are often at odds with what is really needed in these markets. Currently, firms are being allowed to operate in a way that is harmful, and without full and proper transparency. All providers of public services should be open to scrutiny to allow the public to hold them to account. That's why we are calling on government to intervene. We're recommending open-book accounting on public sector contracts, and a range of other measures to help prevent excessive profiteering and increase transparency. These recommendations do not solely aim to improve the environment for social enterprises and charities. They seek to improve public sector commissioning and markets for all, but as a result we believe social sector organisations will flourish.

It's dangerous for the national debate on our public services to rumble on and focus only on state vs independent and whether marketisation should continue or be halted.

There's a huge market out there already and it could be dramatically improved with a huge impact on national well-being. The question now has to be: what kind of businesses do commissioners in government departments and in councils need to deliver services for citizens? How do we want these business to behave? At the moment too many are serving a wealthy minority, when they should be looking after the 99%.

Polling reveals little public support for shareholders making profits from public services

Polling for the Shadow State has identified public dissatisfaction about shareholders making profits from the delivery of public services. Two thirds of UK adults believe it is unacceptable for shareholders to profit from running hospitals and health services (66%), children's homes (66%), police services (66%), and care homes for elderly and disabled people (63%).

The poll suggests a lack of awareness about who is running some public services funded by the taxpayer. Almost half of UK adults (43%) believe the government runs the majority of children's care homes in Britain, whereas in reality the private sector now runs 65% of residential homes for children. Only 11% are run by charities.

Peter Holbrook is chief executive of Social Enterprise UK. The Shadow State is available to download here.

The Guardian

Saturday, 1 December 2012

Councils angry at £1bn of stealth cuts

Council leaders have accused the government of imposing some £1bn of cuts by stealth, leaving town halls dealing with an even bigger reduction in income than they had been braced for. The spending settlement of 2010, which covers most of this parliament, saw local government take a steep cut of 28 per cent to their main grant over a four-year period.

The latest phase of these reductions will be announced in mid-December by the Treasury, just days after George Osborne’s Autumn Statement. However, the Local Government Association says it has identified nearly £1bn of additional cuts or delays to grants in recent months, further adding to their woes. In some authorities these cuts could amount to “more than 10 per cent of core funding from government”, the LGA warned in a briefing note to council leaders seen by the Financial Times.

Local government had hoped that 2013-14 would be a year when overall government funding would be “reasonably stable” after two years of steep cuts, according to the group. Under those proposals, set out in the comprehensive spending review, there should have only been a 0.8 per cent cut to this year’s core funding – after 9 per cent cuts in both 2011/12 and 2012/13. However, “what we are now seeing is the prospect of potential funding reductions that . . . amount to a total funding reduction of up to a further £1bn or more,” the document says. 

The £1bn figure for cuts and deferred grants includes £345m of delayed business rate payments and £200m of education support funding switched to academies. The figure also includes a £150m reduction in the early intervention grant and £100m of “under-funding” from changes in council tax benefit. The final component is an estimated £200m stemming from a pay freeze in local government which the Treasury clawed back from councils.

One Whitehall official said that some of the LGA’s calculations had been “disingenuous”. A spokesman for the communities department said that the full details of next year’s spending would not be clear until the local government finance settlement in December. “Councils account for a quarter of all public spending – this year English councils will spend £114bn – so it is vital they continue to play their part tackling the inherited budget deficit,” he said.

But Sir Merrick Cockell, chair of the LGA, said he was in talks with senior ministers to try to “sort out” the issue. “This has significant implications for all local services. In particular it threatens to severely limit councils’ ability to promote growth at a local level, which would be hugely counterproductive,” he said.

The group has previously warned that the last spending review, combined with the rising cost of social care, will mean that money for non-statutory services such as libraries and leisure centres will have been slashed by 90 per cent in cash terms by 2020.

Financial Times

Friday, 30 November 2012


"It has been over a year in the making, cost £5m, and runs to almost 2,000 pages. Yet, within hours of the publication of the Leveson report into the ethics of the press, David Cameron rejected its key finding." The Independent

"There have been too many times when, chasing the story, parts of the press have acted as if its own code, which it wrote, simply did not exist. This has caused real hardship and, on occasion, wreaked havoc with the lives of innocent people whose rights and liberties have been disdained." Lord Justice Leveson

Among Lord Leveson’s main findings in his mammoth 1987 page report were:

• Unethical practices by the press extended far beyond the News of the World and went on for many years. Editors at a number of newspapers “talked and joked” about phone hacking but did nothing to stop it while unwanted intrusion and surveillance of celebrities was common place.

• Newspaper “recklessly” prioritised sensational stories, irrespective of the harm that they could cause to those affected and “heedless” of the public interest.

• Meanwhile proprietors and in particular Rupert Murdoch paid scant attention to regulating the activities of their newspapers that often “intimidated” or took “retribution against complainants or critics”.

The report was, surprisingly, much kinder to politicians who courted the press, concluding that there was no evidence they were unduly influenced by need to gain press support. In particular Leveson cleared the Government of being unduly influenced by News International in its decision over the BSkyB takeover - a finding criticised by political opponents.

Leveson said there was “no credible evidence of actual bias” on the part of the former Culture Secretary Jeremy Hunt in deciding on the takeover, but criticised the role given to his special advisor Adam Smith, which he said gave rise to a “perception of bias”.

Leveson report: Volume One

Leveson report: Volume Two

Leveson report: Volume Three

Leveson report: Volume Four

Leveson report: Executive summary 

Leveson inquiry: The essential guide

Saturday, 17 November 2012

Green Deal in tatters as no-one registers

The Green Deal encourages homeowners to take out a loan to make their house more energy-efficient. The project goes live in 10 weeks but households have had since October 1 to have their home assessed for the scheme prior to its launch.

However Greg Barker, the climate change minister, has admitted that “no assessments have yet been lodged” on the Government’s official register by homeowners. The Coalition had hoped that owners of up to 14 million draughty homes will sign up to the scheme.

Luciana Berger, the shadow climate change minister, described the Green Deal as a “shambles” and said its launch is “lying in tatters”. 

The Police & Crime Commissioner elections

‎'David Cameron suffered a humiliating blow on Friday when his plans to democratise the police were met by overwhelming voter indifference, with the lowest ever turnout in a national poll threatening to undermine the new elected commissioners' legitimacy.'

Martin Rowson, Guardian

Secret trials and non-disclosure of evidence

"Secret trials and non-disclosure of evidence are potential characteristics of repressive regimes and undemocratic societies."

• That's what the Law Society and the Bar Council think of part two of Ken Clarke's justice bill. 

• They write that the proposals "undermine the principle that public justice should be dispensed in public and will weaken fair trial guarantees and the principle of equality of arms." 

• Opponents fear the powers will enable ministers, rather than judges, to manipulate the way evidence is withheld or presented, depriving litigants of a fair trial.

Thursday, 15 November 2012

Iain Duncan Smith redefines poverty

Child poverty is to be measured by how long children have two birth parents looking after them, the length of worklessness in households and school achievement under controversial new plans announced today. Iain Duncan Smith, the work and pensions secretary, will downgrade Labour's system of measuring poverty relative to the rest of the population, which he believes can provide a skewed picture of household finances.

A new range of indicators will be introduced including family stability, worklessness and educational achievement. Duncan Smith, in a joint move with the schools minister, David Laws, claimed the new measures better reflect the reality of poverty in the UK today.  Guardian

Appearing on BBC Breakfast this morning, Duncan Smith said:

“What we’re saying to everyone out there is ‘look, we could go on playing this game saying we’re going to put more money in'. The truth is the last government spent £171bn on tax credits, they raised expenditure on welfare by over 60% during a time the economy grew, and they still failed to meet their poverty targets for children. By 2010 they quite dramatically failed.”

You can read the government’s consultation here or a summary of the consultation here. Both are pdf documents. There is also a response form (Word document) for plebs to air their opinions.

Sunday, 11 November 2012


Thursday, 18 October 2012

Jesus wept!

Tuesday, 16 October 2012

Number of UK poor receiving emergency food aid doubles

The number of the UK's poor and destitute receiving emergency food aid has almost doubled in the past six months, the country's largest organiser of food banks has reported.

Figures from the Trussell Trust, which operates 172 food banks and has a further 91 banks under development nationwide, show that from April to September nearly 110,000 adults and children were referred for emergency help by professionals such as the police, social workers and job centre advisers and GPs.

The trust, which operates a controlled voucher scheme to track referrals, said that in the whole of the last financial year they fed 128,000 people. Based on demand over the last six months, they expect that number to rise to more than 200,000 between 2012-13.

In the trust's south-west region, one in 120 children have been fed with food packages during the last six months, while in Wales the current figure stands at one in 130.

A breakdown of the figures also shows that while less than one percent of those being referred are pensioners, there appeared to be a prevalence of young teenagers and adults taking up emergency food aid.

In the latest set of figures, 14,500 people, 16% of all those being referred, were aged 16-24, a group that makes up around 11% of the UK population in total.

The trust's executive chairman, Chris Mould, said that while they weren't reaching as many old people as they should be, travel and rent increases and the dire state of the youth employment market had left many of the UK's young adults in a desperate state with little financial resilience.

"When you've got people who are on the margin of just making it and there's another price rise, another change in their outgoings, they can't negotiate [the change]... something gives, and it is going to be the food."

The trust's own indicators show that the largest block of people were being left unable to feed themselves because of delays or a change in circumstances to their benefit claims.

Currently 45% of professionals referring families and adults for food packages cited troubles and delays with the benefits system, a figure that was up from around 40% on the year before and had more than doubled since the recession began in 2009.

Mould said the rise was "significant". "In the first half of this year that's another six or seven thousand people who are being helped at food banks because of problems relating to the timely availability of benefits," he said.

Mould said that other reasons for hunger included debt and delayed wages; circumstances arising out of domestic violence and sickness, but that the Department for Work and Pensions (DWP) who are responsible for the benefits system needed to ask why so many people were being left hungry by bureaucratic failure; increased use of benefit sanctions; and the government's reform measures, which could require benefit claimants to switch to different types of benefits.

"The period in which people are left with no recourse to money and therefore an inability to get food on the table is longer," Mould said.

"The DWP should be deeply interested in what's driving and generating these crises. They really should be asking the question, is there anything we can do to resolve this and to reduce the prevalence, the occasions per month when this happens."

In response to the figures, a DWP spokesperson cited the fact that 80% of benefit claims were turned around in 16 days and said that reforms were making the welfare system more effective. "We recognise the welfare system we inherited is broken, trapping on benefits the very people it was designed to help. Our reforms will transform the lives of some of the poorest families in society by making work pay and lifting thousands out of poverty," a department spokesperson said.

"Jobcentre plus processes thousands of benefit payments each day and we also pay crisis loans to help people who have emergency costs or benefit delays. Where appropriate we also refer people to the Trussell Trust following their request for us to do so," they added.

Shiv Malik and John Burn-Murdoch, The Guardian

Wednesday, 10 October 2012

Cameron: 'This party has a heart'

Here's an extract from David Cameron's speech to the Tory faithful at Conference 2012:

"This party has a heart but we don’t like wearing it on our sleeve. Conservatives think: let’s just get on with the job and help people and not bang on about it. It’s not our style. But there’s a problem with that. It leaves a space for others to twist our ideas and distort who we are: the cartoon Conservatives who don’t care.

My mission from the day I became leader was to change that. Yes, to show the Conservative party is for everyone: North or South, black or white, straight or gay. But above all - to show that Conservative methods are not just the way we grow a strong economy, but the way we build a big society.

That Conservative methods are not just good for the strong and the successful but the best way to help the poor, and the weak, and the vulnerable. Because it’s not enough to know our ideas are right – we’ve got to explain why they are compassionate too. Because we know what we’re up against.

We say we’ve got to get the private sector bigger and the public sector smaller…our opponents call it ‘Tory cuts, slashing the state’. No: it’s the best way to create the sustainable jobs people need.

We say help people become independent from welfare…our opponents call it: ‘cruel Tories, leaving people to fend for themselves.’ No: there is only one real route out of poverty and it is work.

We say we’ve got to insist on a disciplined, rigorous education for our children…our opponents call it: ‘elitist Tories, old-fashioned and out of touch.’ No: a decent education is the only way to give all our children a proper start in this world.

The reason we want to reform schools, to cut welfare dependency, to reduce government spending is not because we’re the same old Tories who want to help the rich...’s because we’re the Tories whose ideas help everyone - the poorest the most."

Tuesday, 9 October 2012

North-eastern NHS Trust set to sack 5,500 staff and re-employ them on inferior terms and conditions

NHS bosses in North Tees and Hartlepool NHS Foundation Trust are due to sack all 5,500 staff and re-employ them on inferior terms and conditions which is a move away from the national agreement Agenda for Change (AFC). The Trust runs University Hospital of North Tees in Stockton and the University Hospital of Hartlepool.

It aims to remove enhanced sick pay from those staff entitled to be paid the normal shift rate when on sick leave. This is part of the national terms and conditions and signals a move away from AFC by the employers that could see the introduction of regional pay and further attacks on terms and conditions. This proposal is part of a package to make savings of £40 million over three years. Previous plans by the Trust included regular car boot sales in the hospital car parks.

Managers have called this a consultation exercise yet plan to sack staff; and those who refuse the new terms will have them imposed upon them without any form of negotiation or consultation. The Trust is hoping to close the two main sites and develop a single centre. Previous plans under PFI have failed and it now looks like NHS staff are being penalised in order to fund new developments.

Nationally AFC is under attack and the employers want to negotiate a range of cuts to terms and conditions attacking holiday entitlement, sick pay, shift allowances and pay progression in return for so called guarantees and no further cuts in the future.

Alarmingly, there have been signs in the early stages from the unions that they would be prepared to negotiate and that the unions should enter into a form of concession bargaining. This has been met with understandable opposition from union branches and members with the call that this agreement should be defended and unions should refuse to negotiate any erosion of pay and conditions. So far the unions have not made a clear statement saying they will refuse to negotiate and further talks are to take place.

There have also been developments in the South West where employers have set up a pay cartel to try to break up national bargaining and introduce regional pay. And there have been rumours of a pay cartel in the Northern region despite a number of Trusts saying they have no intentions of moving away from AFC.

Unison's head of Health has issued a strong statement attacking this proposal and warns of the potential impact of staff coming into work when unwell and the potential threat to vulnerable patients.

Strong words must be matched with action and a campaign to defeat these moves and defend the national agreement. A local and regional fightback is needed now but unless the unions organise on a national basis and prepare for industrial action there will be similar moves across a range of NHS Trusts as managements try to make workers pay for the crisis in funding and the attacks on the NHS by the Con-Dem coalition government.

John Malcolm, Unison branch secretary (mental health), writing in a personal capacity on the Socialist Party website

Friday, 5 October 2012

Cuts could force Shelter office closures

Shelter is considering closing eight of its advice offices in England because of cuts to legal aid. The government cuts will mean a 50 per cent reduction in funding for the housing charity’s face-to-face advice services. Shelter is currently consulting staff on the impact of the cuts before it makes a decision.

Campbell Robb, chief executive of Shelter, said: ‘If these services have to close as a result of cuts to legal aid, this will be a massive blow not only to our staff, but to the people in the affected areas who will no longer be able to get face to face advice and support from Shelter. We will be doing all we can to ensure people around the country can still get help with their housing problems through our helpline and website.’

He added that the ongoing recession and welfare reforms mean the loss of the services would be felt particularly keenly. The affected offices would be in Rotherham, Ashford, Milton Keynes, Cheshire, Gloucester, Somerset, Hertfordshire and Cumbria.

Inside Housing

Kenyans tortured by British colonial forces told they can sue Britain

Three elderly Kenyans tortured by British colonial forces were told they can sue Britain, in a London court judgment likely to encourage other claims dating back to the days of the British Empire. The government, which had tried for three years to block their legal action, said on Friday it planned to appeal as the judgment could have far-reaching legal implications.

Paulo Nzili, 85, Wambugu Wa Nyingi, 84, and Jane Muthoni Mara, who is about 73, suffered castration, rape and beatings while in detention in the 1950s during a crackdown by British forces and their Kenyan allies on the Mau Mau movement fighting for land and freedom.

The trio want Britain to apologise and to fund welfare benefits for Kenyan victims of torture by colonial forces. "The people they imprisoned and put in the detention for seven years (resulted in Kenya) losing a generation," Gitu Wa Kahengeri, Mau Mau War Veterans Association secretary general, told reporters in Nairobi. Nearby, about 40 Mau Mau veterans and relatives cheered, hugged and performed a traditional dance in the midday heat when the news came through.

The veterans said British authorities should stop using legal technicalities to fight the case and, instead, negotiate a settlement speedily as the claimants were frail and elderly. "What could be more despicable, what could be more immoral of Her Majesty's Government than to bide time simply to wait for all these victims to die one by one before tasting justice," Paul Muite, a lawyer advising Mau Mau Veterans, told reporters in Nairobi.

At first, Britain had said that responsibility for events during the Mau Mau uprising passed to Kenya upon its independence in 1963, an argument which London courts rejected. The government then said the claim was brought long after the legal time limit. However, judge Richard McCombe said in Friday's judgment there was ample documentary evidence to make a fair trial possible. "The government and the military commanders seem to have been meticulous record-keepers," he said.

The Foreign Office said while it did not dispute that the claimants suffered torture and other ill treatment, it would appeal nevertheless, because of the judgment's implications.


Friday, 28 September 2012

Revealed: David Cameron's ignorance

'He went, he smirked, he was thoroughly humiliated. It was never supposed to turn out like that for the PM Big Dave. What does Magna Carta mean, asked David Letterman, the king of late night TV in the United States. Britain's shame-faced prime minister didn't know. But then this was nothing more than poetic justice. 

For just a couple of months ago, Cameron quite literally turned his back on an opportunity to learn everything that there is to know about Magna Carta at a special private exhibition painstakingly prepared by the London Metropolitan Archive at London's Guildhall. When he was about to be introduced to the document, with experts standing by to answer his every question, Cameron's response was to spin on his heel with a curt "I've seen that" and go into a corner to play with his iPhone. "It was breathtakingly rude," said one witness. And costly. Poor Dave. Oh dear.'

Hugh Muir, Guardian

Thursday, 20 September 2012

NHS faces £8bn cuts 'after next election'

What did I tell you?

Independent -

NHS has cash reserves of £4 billion, Audit Commission reveals

The NHS has built up cash reserves of almost £4bn even as rationing has increased, the number of nurses has fallen and the service has had to make unprecedented savings, an Audit Commission report reveals.

"This would not happen if hospitals were directly run by the NHS – money could then be moved to where it is needed most, balancing the books and safeguarding patient care," said Christina McAnea, head of health at the union Unison, which represents 400,000 NHS staff.

A spokesman for the Department of Health said: "It is better to plan for a surplus because it gives the NHS the flexibility to respond to the unexpected."

Like being told its budget is no longer ring-fenced?

Wednesday, 19 September 2012

The Olympic Legacy 2012

The government has published a 10-point plan for securing a lasting legacy from the Olympic Games.

• £125m per year funding for elite sport over the next four years - up until Rio 2016.

• £300m investment to turn the Olympic site into the Queen Elizabeth Olympic Park, open to the community.

• Bringing 20 major sporting events to UK by 2019, with more bids in progress.

• Sport England's £135m Places People Play legacy programme to fund new facilities, volunteering and participation programmes.

• £1bn investment over the next five years in the Youth Sport Strategy, linking schools with sports clubs and encouraging sporting habits for life.

• Government support for the Join In programme to build on the spirit of volunteering seen at the Games by getting people to volunteer at their local sports club.

• Introduction of the School Games programme sponsored by Sainsbury to boost schools sport and county sport festivals.

• More done to ensure PE in schools is available to all.

• £1.5m funding to the English Federation of Disability Sport to increase participation in sports by disabled people.

• Continue funding for International Inspiration, the UK's international sports development programme, to 2014.

Tuesday, 18 September 2012

Benefits link to inflation could be cut

The government is considering ending the annual inflation-linked rise in benefits as part of the drive to find additional savings in the welfare budget, according to the BBC. If implemented, the move could be in place by 2014 with many benefits frozen for two years, then rising only in line with average pay. State pensions will not be affected as they are now protected by a "triple lock", which means they will rise annually in line with either inflation, earnings, or by 2.5%, whichever is the higher figure.

In recent years inflation has risen at a far higher rate than average earnings. Whitehall officials say a switch since 2008-9 would have saved £14bn, according to BBC Newsnight. The Department for Work and Pensions declined to comment on the reports ahead of the benefits uprating statement, which takes place in December. "Uprating of benefits will be considered by the secretary of state and chancellor as usual later this year," they said.

The government is looking for £10bn of extra savings in the welfare budget. However, any move to break the historic link between inflation and welfare payments is likely to provoke fury among charities representing vulnerable groups.

Reports of the move come just a year after a thwarted attempt by Chancellor George Osborne to end the annual inflation-linked increase to benefits after a welfare bill last September when inflation was 5.2%. One Whitehall source close to the process told the BBC that the idea was back on the table. "A freeze [to benefits] for a couple of years would help us get to the £10bn," they said.

Any move to freeze benefits is likely to be fiercely resisted by Liberal Democrats, many of whom oppose any further cuts to welfare and believe any further savings should be funded through tax rises at the top.

Hélène Mulholland, Guardian

Co-op Group in fourth year of contract with Atos Healthcare

In July 2009, Atos Healthcare announced that it had won a contract with the Co-op group. The press release read as follows:
"Atos Healthcare, the number one occupational health provider in the UK and a business division of Atos Origin, today announced that it has won a contract with the Co-operative Group (tCG) and Co-operative Financial Services (CFS).
Under the new contract, Atos Healthcare will provide occupational healthcare services for the 82,000 employees who serve around 10 million customers a week through food, pharmacy, travel, funeral care, motor dealerships, legal and financial services. Atos Healthcare will provide pre-employment referrals and absence management including physiotherapy and workstation assessments to help improve employee wellbeing and reduce absence.
“Occupational health is a business-critical service in people-focussed organisations like ours,” said Graham Greaves, Occupational Health, Safety & Wellbeing Manager at CFS. “Atos Healthcare presented a solution that will enable us to further improve and standardise our occupational health service right across our organisation. It also demonstrated how, by implementing new management information and trend analysis tools, we can better monitor our service and ensure that it continues to meet the needs of our employees in the future.”
“We are absolutely delighted to win the contract to provide Occupational Health Services to The Co-operative Group, the UK’s largest mutual retailer,” said Gary Gear, General Manager for Occupational Health and Primary Care Services, Atos Healthcare. “This success further strengthens Atos Healthcare's position as the UK's number one Occupational Heath Services provider.” "
In light of what we now know about Atos, the discovery of the contract with the Co-op has led to disappointment amongst many of the Co-op's members. Last night, the Co-op posted the following statement on their Facebook page:
"Thank you for your comments on Atos, which we do take very seriously. As you will appreciate, as with all our suppliers, we have contractual obligations towards Atos which cannot immediately be revoked, although we will consider your views when reviewing our future relationship. It should be pointed out, however, that we began using Atos as our occupational health services provider before the Government moved to tighten the criteria for disabled benefits and as far as we understand it, this is a wholly different brief to the one we set them. Atos work with our HR department to help us to support those employees who are either on long term sick, or who are working with a disability or other health condition. We take our responsibility towards the health, safety and wellbeing of all of our employees very seriously and an occupational health assessment is just one of the many ways in which we look to support our employees."
As you can see from the comments following the statement, this has not done much to appease the members, many of whom are threatening to relinquish their membership. And it remains to be seen whether or not the Co-op feels that trying to find a way of terminating its contract with Atos is the preferred option.

Friday, 24 August 2012

Beggaring the nation | Taxing the unemployed

The campaign against welfare is the centrepiece of the coalition government's policy agenda. It started with the Chancellor George Osborne, in his emergency Budget, announcing cuts to Britain's welfare budget of £20 billion. That has now expanded to over £30bn, some as yet unspecified.

To cut welfare so drastically has necessitated the government engaging in an unprecedented campaign of vilification against anyone on welfare. This has included the Prime Minister casually talking about people "sitting on their sofas waiting for their benefits" and his welfare minister condemning "people who sit at home on benefits doing nothing."

Some may be aware that David Cameron has promptly popped off on holiday after spending a demanding two weeks sitting in the best seats at the majority of Olympic venues. This divide-and-rule strategy is coming to Croydon as the next tranche of welfare cuts targets council tax benefit.

The government is devolving responsibility for council tax benefit to local councils, which sounds logical enough, but is cutting the amount provided so that councils will be unable to fund all those who need it. All interested groups are invited by Croydon Council to contend for who should and who shouldn't get council tax benefit any more.

So the poor, the sick, the elderly, the disabled and those with children can all fight among themselves.

What this government and its tabloid cheerleaders fail to inform us is that over the same period as they propose to cut £30bn from the unemployed, the elderly, the poorly housed, the disabled, and those with children they are giving away far more than £30bn in tax breaks to some of the wealthiest people in Britain - through reduced taxes on the biggest corporations and the cut in the 50p income tax rate for the super-rich.

Meanwhile, under Croydon Council's proposals, someone on Jobseeker's Allowance (JSA) is to be subject to an effective 5 per cent weekly tax, paying £3.50 out of their £71 JSA. For the steeply rising number of youth unemployed, this represents an even greater proportion of their allowance, which is just £56 per week.

This is a first - people on benefits made to pay tax. Britain has the lowest unemployment benefits in Europe. As the government's failing economic policies increase unemployment, that same government proposes taxing people on benefits that barely support sustenance in London. Only the Eton-educated millionaires on the front bench of the Con-Dem government could think that this is the obvious place to look for extra tax revenues. 

One of the abiding memories of my formative years was the bile spewed from government ministers and sections of the tabloid press towards single mothers. I remember it because of the impact it had on me and my single mother, who did an amazing job raising me and my sister. That hate campaign, combined with a false sense of pride, meant that my mum did not claim the means-tested benefit to which she was entitled.

The same thing happens today - parents not claiming tax credits and pensioners refusing to take up Pensions Credit or their free TV licence. While we often hear much about the £1.5bn of benefit and tax credit fraud, there is a corresponding silence about the £16bn annually that is left unclaimed - let alone the billions lost through tax avoidance by the likes of the former Conservative Party treasurer Lord Ashcroft.

But this government is going well beyond the rhetoric of its Thatcherite predecessors. It is not only demonising people, but taking away their rights - rights established by our welfare state to housing and a decent income if we are unable to work. French IT company Atos has a £100 million contract to reassess every disabled person on benefits. The government wants a million fewer people claiming, but denies Atos has been set targets to remove benefits.

Whatever the truth 40 per cent of people initially denied their benefits are reinstated on appeal, and that figure rises to 70 per cent if they are represented by a lawyer. It's a wry joke among disability campaigners that the government doesn't give Atos about them.

Housing benefit is being similarly restricted. After successive governments selling off council homes and failing to build to replace the social housing stock - thus fuelling the inflation in the private housing market, especially in London and south-east England - much of the welfare state's budget is now being spent in giving large amounts of money to private landlords, unencumbered by the regulations or rent tribunals of the past.

The government's solution is neither to build new council housing - which would be a huge and necessary economic stimulus - nor to cap the rents that landlords charge, but to cut housing benefit which will inevitably force people out of their homes. Croydon is one of the London boroughs seeking to "exile" local residents by relocating their tenants to other parts of England, tearing up community and family ties.

We mustn't be drawn into their beggar-thy-neighbour approach. Instead we should come together to campaign against the cuts wherever we can - in your local community group, in your trade union, in your political party and on the streets on October 20.

Written by Andrew Fisher of  the LRC
Published by Inside Croydon/Morning Star 

Monday, 13 August 2012

Government launches £2m Olympic volunteering legacy charity

A new £2 million government-backed Olympic volunteering legacy charity has been set up by David Cameron, with volunteering leaders Lucy de Groot and Justin Davis Smith as trustees. The chief executives of CSV and Volunteering England, respectively, will help lead the Join In Trust - set up to promote volunteering in local community organisations. Its first project, Join In Local Sport, has been heavily promoted today on an official Olympic email to millions of people. 

Join In Local Sport's first campaign is to get as many people as possible to turn up, take part and join in at their local sports facilities this weekend. Its website includes online listings of local sporting events around the country and allows members of the public to search for events via postcodes, and groups to add events via an online form. As part of the weekend, sporting icons Daley Thompson, Sharron Davies and Jonathan Edwards, broadcaster John Inverdale and current Olympians will visit a wide range of these sports clubs. 

David Cameron said: "We need to make the most of this magic moment and harness the enthusiasm for sport and for volunteering the Games has generated. That's why the Join In Local Sport project is so important, so that we bring London 2012 back to the place it begins for every great champion: their local sports club and the great volunteers who make it all possible."

The Join In Trust board is made of eight trustees and is chaired by Sir Charles Allen CBE. The organisation is led by a mix of people from sporting, business and volunteering backgrounds and has been funded with a £2m grant from the Cabinet Office.

Civil Society

Social housing construction work plummets

The amount of new social housing construction work has plummeted 25 per cent in a year, official government figures show.

The Office for National Statistics published figures on Friday showing the volume of new work in the public housing sector in April to June fell 7.6 per cent compared to the previous quarter and 25 per cent compared to the same period in 2011.

Public housing sector work dropped from £1.15 billion in April to June 2011 to £865,000 in the same period this year. The decrease in private housing work was much smaller. It fell from £3.5 billion to £3.3 billion, a decrease of 6.6 per cent.

The figures show that the total volume of construction output fell by 9.5 per cent year-on-year, and 3.9 per cent quarter on quarter.

Noble Francis, economics director at the Construction Products Association, said: ‘Looking at these figures, it is very hard to find anything positive to say in any part of construction. This situation is rapidly becoming a crisis and at this rate I wouldn't be surprised if manufacturers begin to shut down their operations and lay people off.’

Inside Housing

Friday, 3 August 2012

Olympic legacy? You're having a laugh, aren't you?

A study of Sydney by Australia's Monash University found there was no tangible benefit "or economic boost" from the Games. An IASE report on Atlanta called Bidding for the Games: Fool's Gold? found that "diverting scarce resources from more productive uses translates into slower rates of economic growth". Civic leaders talk desperately of "legacy" but no survey can find any. Barcelona saw hotel occupancy fall from 80% to 50% in the year after the Games. The city's subsequent prosperity is now attributed to cheap flights and the Spanish boom. Beijing has seen no games-related uplift.

On London, an exhaustive 2006 report for the European Tour Operators Association pointed out that sport is a "notoriously narrowly focused" form of travel, with no spillover into wider tourism. "During the Olympics, a destination effectively closes for normal business," it warned. Mark Perryman's spirited survey, Why the Olympics Aren't Good for Us and How They Can Be, charts the same tale. More ironic is Mitchell Moss's How New York City Won the Olympics. It points to how, by losing the 2012 bid, resources allocated to the Games were diverted to the Lower West Side and other, now booming, locations.

There is no shred of evidence for claims still being made by the government and others of an Olympics profit, fast weakening to a "promotional legacy". Nor is there evidence of ministers recovering their brains. Today the culture secretary, Jeremy Hunt, described talk of ghost London as "absolute nonsense". The city was booming, he said, and "quids in". The sports minister, Hugh Robertson, attacked ailing businesses, saying: "This is hardly a surprise … there has been ample time to plan for [the Olympics]."

Their problem is they did. For years Robertson's department told everyone to prepare for a boom. Hotels raised prices and took on extra staff. Bus and tube drivers were paid bonuses to cope with the crush. Central London was told to expect an invasion and that residents should stay at home. This was the tone of every statement from the mayor, Boris Johnson, and his transport boss, Peter Hendy. Either these men were lying or their apparatchiks dared not tell them the truth.

I can find no warning in recent years from any official body that August 2012 would be anything but a cash-rich bonanza. Last week Johnson was still hyperventilating like Big Brother over tube loudspeakers that passengers should expect "a million extra visitors a day". He must have known this was rubbish. Reports were pouring in from London business associations of trade at hotel, restaurant, theatre and other tourist venues plummeting by an average of 30%. With August always down, they had been told to greet a "games uplift". They must have a strong case for a class action against the mayor, who has been milking the games for all the politics he can.

Clearly the authorities massively misjudged, but it was entirely because they refused to believe the evidence of past games. They were glory-blinded. Had the government said from the start that London was a rich city staging the Olympics as a costly but generous gesture to the world, there could be no further argument. Ministers said no such thing. From Cameron down, they claimed the games would make money, now and, if not now, then some time in the future. This was plain dishonest. Everyone knows there is no Olympic legacy, but, as with Santa Claus, we dare not tell the children.

Simon Jenkins (extract), The Guardian

ADDENDUM 04.08.12
Meanwhile, Michael Burke writes, also in The Guardian, that "the prospect of an Olympics bounce would have been far greater if the mayor of London had not cut the budgets for all the agencies promoting tourism, international students and foreign direct investment to London." 

"Another bitter blow for sick and disabled people" as ATOS wins three more contracts

Charities reacted with horror yesterday as the Government announced that Atos and another private company, Capita, had won three contracts to run a new work-capability check for disabled people being brought in next year. The Government has suggested that half a million people could lose their benefits as part of the reforms, which affect working age disabled people from April next year. Children and pensioners will not be affected. The companies will assess disabled people for a benefit to help with their higher costs of living, called the Personal Independence Payment (PIP), which replaces the Disability Living Allowance (DLA).

Atos, which has been criticised for carrying out inaccurate assessments on the unemployed, will be responsible for tests in Scotland, London, the North-east, North-west and South of England, while Capita will administer Wales and central England. There have been huge concerns about Atos's existing scheme, with criticism of the "tick box" nature of the tests and accusations of a high rate of inaccurate decisions, with 40 per cent of rulings being overturned on appeal.

Steve Ford, chief executive of Parkinson's UK, described the news as "another bitter blow for sick and disabled people". In a letter to The Independent, Mr Ford wrote: "It is hugely concerning to see that Atos have been given the green light for the Personal Independence Payment contract. Assessments carried out by Atos have led to many people being forced to appeal against decisions that are plainly wrong. How can someone with Parkinson's – a progressive neurological condition – have an assessment report that implies they will be ready for work again in six, 12 or 18 months?"

Gillian Morbey, chief executive of the deafblind charity Sense, said: "We are concerned that the Government has awarded another contract to Atos. Their track record of poor initial Work Capability Assessments is costing more in the long run." Hayley Jordan, co-chair of the Disability Benefits Consortium, a coalition of charities representing disabled people, added: "PIP will be a lifeline for disabled people and it is essential this difficult process is managed well."

The Government yesterday described the DLA – worth up to £131.50 a week – as an outdated benefit and said the new assessment would "ensure that, unlike in DLA, disabled people will be able to have a detailed discussion with a health professional about how their impairment affects their everyday lives". Ministers have expressed concern at the rise in the number of people claiming the benefit, which has gone from 2.5 million nine years ago to 3.2 million this year, at an annual cost of £13bn.

The Independent

Wednesday, 1 August 2012

South West England hospitals seek to slash wages

by Ajanta Silva

Nineteen National Health Service (NHS) Trusts in South West England, covering 60,000 hospital workers, have formed a Pay, Terms and Conditions Consortium (PTC).

The South West pay cartel’s objectives are to reduce wages and introduce a performance-based pay system, increase working hours, reduce unsocial-hours payments, remove sickness absence enhancements and cut down annual leave. The cartel threatens that any staff resisting the plans will risk their existing contracts being terminated. These attacks are a test-case for the 1.5 million NHS workers across the country.

The leaked Project Initiation Document (PID) of the consortium reveals the cold-blooded preparations of the highly paid NHS chief executives against their employees. Among the key objectives of the consortium is to reduce the pay bill of the South West region NHS trusts by nearly 10 percent. It argues, “Economic challenges require health providers to continue to reduce costs over the next three to four years and probably beyond... the scale of change required is unlikely to be met (and will not be sustainable) without reducing the pay bill.”

The cartel is aiming to reduce wages and conditions ahead of further privatisation of NHS hospitals. Officials claim the failure to slash wages and conditions at Hinchingbrooke hospital in Cambridgeshire, the first to be privatised, has contributed to its current financial problems. The PID states that it wants to “create terms and conditions that are focussed on improving engagement of staff and aligning to create a fit for purpose, flexible workforce able to respond to any qualified provider.” For “qualified provider,” read any private company that is looking to make profits from patient care.

To achieve these outcomes, the PID stresses, “Unless ‘voluntary’ agreement could be secured via either collective bargaining or majority acceptance following direct appeal to staff, it is likely that Trusts would be obliged to dismiss and re-engage staff to secure such changes.”

The PTC intends to implement these changes in the South West NHS trusts by April next year and then extend them to Mental Health/Community and Social Enterprise Trusts across the region. Trust managements have already started to intimidate and suppress workers who oppose this bloodbath, with some banning any discussion of the proposals in staff meetings. Unions have been told not to display information on notice boards and workers who have spontaneously started circulating petitions were forced to stop.

These attacks are a direct outcome of the Conservative/Liberal Democrat government’s Health and Social Care Bill and ongoing health cuts to the tune of £20 billion pounds—almost a fifth of the NHS’s entire annual £108 billion budget.

Currently, full-time NHS workers are on a 37.5 hour week and have seven weeks of annual leave a year. They receive enhanced pay when they work unsocial hours, weekend and nights, which most are obliged to do. They receive an incremental progression each year until they get to the top of the pay band and until recently received a pay rise every year linked to inflation.

With the complicity of the unions, the government imposed a two-year pay freeze in its 2010 budget. Since then, inflation of 3-5 percent a year has forced many NHS workers into financial hardship. On top of this, workers are forced to pay much more into the pension scheme at the same time as the retirement age has been increased, child tax credits have been reduced and child care fees increased. The government’s meagre £250 a year increase for workers earning less than £21,000 a year is a farce.

Significant numbers of workers have been forced to work extra hours in the Staff Resource Pool (known as the “bank”) or with employment agencies in a desperate attempt to compensate for plummeting living standards.

The same “efficiency savings” have severely affected patient care. The government has already reduced staff numbers through natural wastage [attrition] and the non-filling of vacancies and has earmarked more than 60,000 posts to be axed throughout the country. This has resulted in staff shortages and non-availability of specialist and experienced workers on weekends, public holidays, nights and other unsocial hours. The PTC insists that “further more radical changes to the pay and conditions of the workforce” are needed.

The South West NHS chief executive group, which initiated the cartel, believes that the existing “Agenda for Change” agreement is a barrier to implementing radical changes to pay, terms and conditions. The Agenda for Change was agreed between unions, the previous Labour government and NHS employers in December 2004. With promises of extra cash and under the guise of a “devolved health service, offering wider choice and greater diversity”, it was a vital component of Labour’s plans for a “new national architecture” that involved the dismantling of the NHS and turning the provision of health care over to private corporations.

The unions sold the Agenda for Change to NHS workers, claiming that the radical reorganisation of NHS staff’s job descriptions and work patterns would protect wages and conditions. However, at the core of the Agenda for Change were provisions for the end of national pay scales and an increased dependency on discretionary pay based on productivity gains. The actions now being taken by the PTC are a predictable outcome of the agreements made earlier.

Trade unions function as collaborators in implementing these drastic measures. Unison and Unite played the crucial role in selling out the struggle of 4,000 Southampton City Council workers last year against the council’s policy of firing and rehiring at lower wages. All the NHS trade unions have agreed to the government’s increase in the retirement age and attack on pensions.

The PID reveals further evidence of the treachery of the unions, which have indicated their willingness to take part in further discussions on cutting down sickness absence enhancements, removing the requirement to offer enhanced payments for unsocial hours, and cutting down yearly incremental progression.

The unions have kept workers in the dark on the PTC proposals for months. Now that workers are starting to take matters into their own hands, the unions have started fruitless petition campaigns pleading with individual trust managements to withdraw from the Pay Cartel and preventing any broader mobilisation of NHS workers.

Time and again the unions have demonstrated that they are not capable of defending even the existing social position of the working class, let alone improving them. NHS workers must form action committees to unify all staff regardless of what they do, with patients and the wider population, with the aim of preventing the dismantling of the NHS and bringing down the government that is behind these plans.

Written by Ajanta Silva for

Tuesday, 24 July 2012

The legacy of the Games

On 3rd July this year, a report by Lloyds Banking Group claimed that the Olympic Games would bring in  £16.5 billion for the UK economy, creating 62,200 jobs along the way. In the shorter term, it is alleged, the Olympics will improve the public mood and encourage people to spend more money. The report looks at the benefits of the Olympics from 2005, when London was selected as the host city, until 2017. Coincidentally, Lloyds is among the sponsors of London 2012.

However, the Guardian reports today that the usual flow of international visitors and domestic travellers through London has come to a grinding halt, as thousands desert London because of the Olympics, leaving hotels, restaurants and theatres unusually empty in the last few days before the start of the Games. Many of London's five-star hotels are frantically discounting their room rates by nearly half and top restaurants are easy to book. Even house rentals are disappointing. "Many people saw the Olympic rental market as something they could cash in on, but the truth is that the supply has easily outstripped the demand." In addition, thousands of jobs ‘created’ by the Games themselves have been substituted for troops, called in to make up for the pitiful attempt by G4S to provide security at all the Olympic venues.

The official London 2012 website informs us that the building of the Olympic Park has already contributed around £2.3 billion to the economy. Which is handy because £2.2 billion of National Lottery funds were used to create the facilities to host the Games, plus a further £66 million specifically for the Paralympics, thereby "providing a legacy for the people of east London and the wider UK." The National Lottery is also playing a key role in “funding work that will lead to increased participation in sport at a community and grassroots level and deliver improved community services and facilities”. The Lottery will share in the profits made from land and property sales in the future.

And then there's The great Olympic tax swindle by Simon Birch in Tuesday's Independent.  Best just read it in full rather than me attempting to summarise it.

It is also worth noting that earlier this year the royal wedding and the Queen's diamond jubilee weekend were both sold to the gullible British public as wonderful opportunities to bring millions into the UK via, amongst other things, tourism. Three months down the line and the Treasury are actually blaming the two events for the flailing economy.

Monday, 23 July 2012

Olympics may not pull UK out of double-dip recession

The UK has waited years for the Olympics to arrive and, finally, it is here. The 30th Summer Games, which cost the British government a gut-busting £9.3 billion to organise, is hoped could help wrench the country out of a double-dip recession. But analysts are no longer so confident, with many expecting that the games will have a dismal effect at best on the country's flailing economy.

A recent report released by Moody's revealed that any benefits caused by an uplift in games-related tourism might be short-lived, while Q2 GDP estimates by the ONS, which come out on 25 July, are expected to show that the placebo effect of the Olympics is likely to be overshadowed by the eurozone crisis.

MarketWatch, Wall Street Journal

Sunday, 15 July 2012

Shitstorm hits the Coalition

• Cameron says something interesting but is anyone paying attention?
Tim Montgomerie, ConservativeHome -

• Wanted: a Tory leader with Tory values
Iain Martin, Telegraph -

• Cameron calls for coalition unity
BBC/Times -

• Only Cameron can rescue the coalition. But does he want to?
Andrew Rawnsley, Observer -

• The coalition's not a happy marriage, but we must stay united
John Pugh MP, Observer -

• Will David Cameron be able to keep his coalition, and his own party, together?
Toby Helm, Observer -

• Tories versus Lib Dems: the coalition flashpoints
Toby Helm, Observer -

• 'Stop apologising,' says Clegg
Independent -

Saturday, 14 July 2012

Rail network to see 'biggest investment' since the Victorians

David Cameron and Nick Clegg will join forces next week to declare that the government is to embark on the biggest investment in the rail network since the Victorian era as ministers move to demonstrate their commitment to boosting economic growth. In an attempt to show a renewed sense of purpose, after last week's bruising rows over Lords reform, the prime minister and his deputy will announce the electrification of a series of lines and the symbolic reversal of some closures imposed in the 1960s by the Beeching axe.

Richard Beeching, the late chairman of the British Railways Board, became a hate figure for rail enthusiasts when he compiled a report that led to the closure of 2,363 stations and 5,000 miles of railway lines. Fifty years later, Clegg and Cameron will confirm plans to reopen part of the Varsity line, from Oxford to Bletchley. The plans, which are likely to involve £10bn of capital investment between 2014 and 2019, are likely to involve:

• The electrification of the Midland mainline from London to the east Midlands and Sheffield. Clegg is MP for Sheffield Hallam. The Great Western line from London to Swansea, via Cardiff, will be electrified. The Cardiff Valley Network will also be electrified. Electrification is favoured by the rail industry because electric-powered trains are lighter than their diesel-powered counterparts and can accelerate more quickly. They are also less susceptible to breakdowns.

• New projects, to be named the Northern Hub, around Manchester to improve services across the north of England.

• Upgrading part of the east coast mainline from London to Newcastle and the spur to Leeds.

• Investment for improved railfreight to key ports such as Southampton and Felixstowe.

Stephen Joseph, executive chairman of the Campaign for Better Transport, said: "We welcome this programme, which with HS2 [the High Speed Two line from London to Birmingham] amounts to the biggest rail investment programme since the Victorians. It will make rail journeys quicker, smoother, quieter and greener and give more people a choice in how they travel. But we are concerned that rail users will face even higher fares to pay for it – the government is still committed to RPI+3% fares increases for the next two years. These projects will benefit the whole country and should not be paid for by already hard-pressed commuters who are already paying some of the highest fares in Europe."

The government's claim of record investment will be based on two politically contentious sources of finance to repay the investment needed: fares and the taxpayer. The farepayer is the biggest contributor, with inflation-busting fare increases helping generate £6.6bn for the railways last year. The 2009-2014 programme said passengers should foot more of the cost of expanding the network, with farepayers nearly doubling their contribution. Ministers have expressed hopes that a more cost-efficient railway will result in lower fare increases from 2014, but there is no sign of that happening. Fares are expected to rise by 3% above inflation until 2015 at least, despite the government targeting a £1bn cut in the annual cost of operating the network by the end of the decade.

The state provided a further £4bn in grants last year, but the taxpayer underpins the massive debts that fund the improvement work. Network Rail, which owns, operates and maintains tracks and stations, has borrowed £27bn over the last decade to fund its investment programme – a deficit underwritten by the taxpayer. The complex funding arrangements will allow the government to say that it is embarking on the biggest investment project since the Victorian era. The £10bn investment in new rail projects is around £2bn smaller than the current five-year spending plan, for 2009-2014, which included a £5.5bn upgrade of the Thameslink route through central London.

The reference to the Victorian era will provide a sober reminder of the risks of relying too heavily on private companies and passengers to pay for the work. Many Victorian railway entrepreneurs were driven to ruin by the high cost of the engineering work. This often happened after they battled against traditionalists, immortalised in the recent Cranford television drama based on the Elizabeth Gaskell novels.

The reopening of part of the Varsity Line, or the Brain Line, between Oxford and Bletchley, will be welcomed by traditionalists and by business leaders who believe it covers a crucial growth area. The line, which used to link Oxford and Cambridge, escaped the Beeching Axe but was closed in 1967.

The Guardian

Friday, 13 July 2012

Serco - the biggest company you've never heard of

This video from the Hungry Beast, broadcast on Australia's ABC network, give's a brief introduction to Serco and the services they run across the world.

Wednesday, 11 July 2012

My Home Life

No, I'm not about to tell all. My Home Life is a nationwide collaborative movement to promote quality of life for those who are living, dying, visiting and working in care homes for older people through relationship-centred, evidence-based practice. The programme is led by Age UK, in partnership with City University, Joseph Rowntree Foundation and Dementia UK. Uniquely, it has the support of the Relatives and Residents Association, together with all the national provider organisations that represent care homes across the UK. 

There's also a Facebook page and a Twitter account for those of you in the loop!

Review on the impact of Universal Credit

The Children’s Society, Citizens Advice and Disability Rights UK are working together in supporting Baroness Tanni Grey-Thompson to produce a review on the impact of the new “Universal Credit” benefit on disabled children and adults. To do this they need your help -  you can contribute to the review in several ways:

• Read about the changes and the groups most likely to be affected
• Take their survey for Tanni’s review
• Respond to the Government’s consultation on the Universal Credit regulations

The changes and the impact on disabled people

Universal Credit will replace all means tested benefits for working age people from 2013, including income based jobseeker’s allowance, ESA, and tax credits.  Some groups of disabled people will get more financial help under Universal Credit but some who claim for the first time will receive considerably less money under Universal Credit than they would get under the current system.

The final decisions have yet to be made, as the detailed regulations still need to be passed through Parliament.  They want the Government to change its plans, so that certain groups of disabled people aren’t hit disproportionately by the changes to the way financial support for disabled people is structured. They have calculated how much different groups of people will get under Universal Credit but to inform our lobbying, they also need to know more about the additional costs disabled people often face in different situations because of their impairment or long term health condition eg the extra costs of transport.

• Find out more detail about the changes ( 31kb)
• Find out about the financial impact on different groups of disabled children and adults (160kb)

Respond to the review

They are particularly concerned that certain groups of people will lose out under universal credit.

They are interested in hearing from people who are in each of the following situations. If you have a disabled child with a long term health condition or impairment, or are a disabled adult in work, or if you live alone and are disabled adult and not have a carer.

There are three surveys, please complete the survey below that is relevant to you.

(Please note that unless your circumstances change your benefit won't be reduced, but you will be able to give valuable information about what the effect would be on new claimants).

Respond to the Government’s consultation

The government is consulting on these changes you can find out about the changes ( 31kb) and financial impact ( 160kb) they will have - and then respond to the consultation. There has been much less focus on the changes in Universal credit than other changes facing disabled people but for some people there will be a much greater financial impact form this than any other change.

What will happen next?

Based on the survey responses we receive, the review will be producing a report in the autumn in advance of MPs and peers debating the changes in Parliament – this report will illustrate the impact of these changes on people’s lives.

Resources and further information

• Briefing document about restructuring of support for disabled people under universal credit (31kb)
• Scenarios: How different types of families will be affected by the proposed changes under universal credit ( 160kb)
• Respond to the consultation on the social security advisory council website
• Universal credit on the Department for Work and Pensions website

Thursday, 5 July 2012

The Barclays ethos infects our culture - purge the entire board!

The bank's directors sit on so many institutions that banning them all would send a healthy shock wave through the City, writes Polly Toynbee

If this is culture change, it's glacially slow. Five years after Northern Rock signalled a banking collapse that impoverished nations, there is no reckoning. Citizens are impotently angry but business as usual prevails. David Cameron emits half-hearted indignation: the banks will be semi-split, and not until 2019. Meanwhile, testosterone-fuelled silverbacks eat what they kill in under-supervised dealing rooms, skimming fortunes from everyone else's endeavour. So far the remedies are cough drops for cancer.

The biggest beast strides off with £100m, plus another possible £20m goodbye money. He is not struck off, nor abashed, not a bit. Is that a master of the universe, that charmless prevaricator with less self-awareness than an ape? These princelings' characters are malformed by a lifetime of courtiers' flattery. Politicians face hourly reminders that they are mortal, but not the denizens of the high towers of finance. The FSA signalled unease about the cultural failings of Diamond's leadership four months ago, yet the board clung on to him even after that £290m fine.

The Financial Times writer John Gapper quotes one ex-banker's thinking: "It would be a very good thing if an awful lot of people lost their jobs in a lot of banks." A purge would indeed send out shock waves. Firebrand Stelios Haji-Ioannou, a major shareholder in easyJet, had the right idea this week in calling for Sir Michael Rake's ejection from the airline's chairmanship, for his role on the Barclays board. If the entire board of Barclays was sacked, not just from the bank but banished from all their multiple other posts and banned from future directorships, consider what a healthy fright would shudder through every complacent institution infected with the Barclays culture, with so many Barclays directors on the boards of regulators and standard-setters.

In the great Barclays purge, let's start with Rake. He loses his chairmanships of BT and easyJet, and his directorship of McGraw-Hill Inc. Away go his seats on the advisory boards of the CBI, Soas, Chatham House and Bupa. Off goes his seat on the board of the Guards Polo Club. He gets the bum's rush from regulatory authorities too: he loses chairmanship of the Guidelines Monitoring Group (overseer of private equity), along with his seat on the DTI's US/UK Regulatory Taskforce. Quis custodiet?

Sir Richard Broadbent, Barclays deputy chair, loses his chairmanship of Tesco. Out goes his place on the board of Relate, and his partnership at the improbable Centre for Compassionate Communication.

Non-executive director Reuben Jeffery III would be sacked as chief executive of Rockefeller & Co. This former George W Bush under-secretary loses his post at the Center for Strategic and International Studies: that derives from his time as special adviser to Paul Bremer, head of the Coalition Provisional Authority in Iraq. Someone wiser might not boast of that epic calamity on their CV. Look now at Sir Andrew Likierman. This Barclays director is sacked as chair of the National Audit Office. What kind of an auditor is he? But above all, he loses his post as highest paid vice-chancellor, dean of the London Business School, where he teaches the next generation the culture he oversaw at Barclays.

I will spare you the details of each Barclays panjandrum, but for these: Naguib Kheraj, vice-chair of the bank and chair of the Aga Khan Foundation, is sacked from the NHS Commissioning Board, where he oversees Andrew Lansley's redisorganisation. Marcus Agius, former Barclays chair, sits on the BBC Trust. Alison Carnwath, chair of Barclays remuneration committee, which set Diamond's pay, sits on 12 other boards. Thus the banking culture of hyper-excess spreads, suggesting it's what everyone does, the way of the world. So the BBC director general's pay span into the stratosphere, or the London Business School tells students how to feel entitled to mammoth rewards.

We need know nothing of these directors' individual talents or deficiencies: they are all responsible for a bank that went out of control. Whether they were all "physically sick" together with Diamond when they heard the news of Libor-cheating in their trading rooms that inflated bonuses, who knows. But here is an establishment web, a hard-wired network of interests intertwined with regulators and ethics-setters where a thorough sacking would send an electric culture-change signal.

Don't hold your breath. The Bank of England has just shovelled another £50bn quantitative easing into the pockets of the banks, the bourne from which no cash returns, while the British Chambers of Commerce again this week called for the money to go instead to a national investment bank for small business.

Ed Miliband made sure Labour owns the turf on reforming capitalism: George Osborne's sneering smears only rebound as Labour pulled further ahead in polls. But to escape his past, Ed Balls needs to jump into the future. With the EU adopting a financial transaction tax by December, Labour should call for the UK to join, raising £30bn a year. Call for total bank separation now, not in seven years. Ban bonuses. Turn the UK from tax haven to safe haven of financial probity.

Financial writer John Kay reminds how cleaning up UK casinos, contrary to warnings, made London the most honest and popular city for high rollers. The Lloyd's scandal strengthened London insurance by cleaning up to flourish. Would finance flee? Broker Tullett Prebon warned it would leave, but couldn't get their traders to go. Call out Cameron for refusing to join EU regulation. Labour needs to jump ahead to where the voters are. Then Ed Balls can shed memories of Gordon Brown's City-worshipping days.

Written by Polly Toynbee  for The Guardian
Illustration by Satoshi Kambayashi