Public Sector Pay - How much does Steve Bundred (the head of the Audit Commission) get paid ?

The head of the Audit Commission is apparently urging the government to impose a public sector pay freeze this year. Whilst I can see the logical arguments in favour of this (even as a public sector worker), I do not accept his justification for making this statement.

Apparently he feels that the health and education sectors are ripe for public sector pay freezes because he felt that public sector workers had "done well" in the past 10 years and would "tolerate" modest reductions.

Now if this were true, I would be even happier. However my last four pay rises have all been less than inflation increases, and the current three year pay deal (which we have only had one year of) would, if the government had met its inflation targets, have ensured another two years of less than inflation rises.

Now by a strange quirk, the government decision to impose an anticipated less than inflation deal on teachers has backfired and it might actually mean a genuine pay rise because inflation has dropped below the 2.35% that teachers were due to get in September, the head of the Audit Commission feels that he can spout off about how well teachers have done.

As I said, I cannot argue with the logic of pay restraint at this time, but please don't be fooled by this fool Steve Bundred telling people that teachers have "never had it so good", because if he failed to understand that teachers have had years of real terms pay cuts, he really cannot be trusted to be telling the truth on anything else.

The daft thing is that according to the Audit Commission's own press releases, they paid their staff a 4.9% increase this year because of the high level of inflation. Perhaps they should note that when inflation rocketed last year, teachers got 2.4%. So how can they pay 4.9% to their staff (whilst also consolidating bonuses in to pay levels, thus increasing management salaries even further) but demand restraint for teachers and nurses ?

Did the police give the protesters enough rope ?

Last night the TV news predicted that a possible high profile target for protesters in London would be the RBS building near the Bank of England.

So what happens today ? Protesters get to the RBS building, attack it, break in to it and attempt to set fire to it and there was not a single policeman inside the building in case of such an attack ?

How can the TV news predict something but the police not anticipate it ?

It looks to me that the powers that be were willing to let the protests to get out of hand in order to vilify all the protesters.

The sad irony

Today, in Scotland, the Dunfermline Building Society, Scotland's biggest such society, was taken in to government control after effectively going bankrupt.

This is sad news for the employees who may lose their jobs but it says something about Gordon Brown, doesn't it, that his constituency includes parts of Dunfermline ?

Iain Dale just doesn't get it

Iain Dale asks where Vince Cable was in 1997. One would have hoped Iain would know this but Vince was only newly elected that year.

Secondly, for the second time this week he is trying to claim that the Tories were first to predict the economic crisis. Oddly his justification for this last time was a quote from Robert Peston (the BBC economic guru) that stated the Tories were asking questions about the economy before Labour. What the Peston quote didn't say was that the Tories were first to say it. But this didn't stop Iain from taking the quote and claiming it showed the Tories were first and said it before the Lib Dems.

But now he is saying that Peter Lilley, back in 1997, was saying that there were problems ahead. This is odd in itself as it seems to be that Peter Lilley, a Tory, was saying just as the Tories were leaving office, that the Tories policies were wrong. And given that Labour pretty much adopted Tories spending for the first two years of their government, clearly Peter Lilley must have been saying that the Tories own policies were to blame ?

It might make Iain feel better to make spurious claims that the Tories were right, but the country and the press know the truth, and a few postings like Iain's are not going to persuade people otherwise.

Update : As Iain points out to me in the comments, Peter Lilley was explicitly referring to the government decision (Labour) to set up the FSA. I accept that this is not a direct criticism of Tory policies up to 1997 but does beg the more important question as to why it is that Peter Lilley has been sidelined by the Tories since the late 1990s. It seems his criticisms were not welcome in the Tory party, a party reliant on hedge funds managers and city types making large donations from their bonuses. So let's be kind and accept that one Tory might have made a good point. Out of all the Tories in parliament you might bless at least one of them with a brain. You can say he spoke for the Tory Party at this point but when the Tory Shadow cabinet hasn't exactly been repeating Lilley's line since 1997, it tells you where the Tories stand on the issue.

Compare this to Vince Cable who speaks for the Lib Dems officially and remains a key member of the Lib Dem team and there is your difference Iain.

Fred the Fraud

Tomorrow's papers are apparently full of revelations regarding Sir Fred Goodwin, the man who liked to be known as Fred the Shred for his costcutting.

Apparently various newspapers and the Lib Dems have found out that his office was decorated with wallpaper costing £1000 a roll, his limo bill per month was £100,000 and on top of this, in the very height of decadence, he liked his fruit to be flow in on a daily basis from Paris.

Isn't it about time he was referred to as Fred the Fraud ?

So spectacularly wrong on so many levels

Peter Mandelson took it upon himself today to give a lecture to the few remaining car companies producing automobiles in this country today, advising them to make the right decisions to ensure their futures. I am sure the car industry could barely control their excitement at getting advice from the UK government.

What is clear so far is that the UK government have got it so wrong when it comes to supporting industry in this country during the depression and sadly seems so completely unable to recognise successes in other countries. In the case of the car industry, Britain should be taking a lesson from the Germans.

Our Labour government are handing out the prospect of large sums of money to support car companies and stop them laying off workers, although no payments have yet been made by the UK government. This means the depression is deepening, the prospects for these manufacturers is getting worse, and so we have a catch 22 situation which the money from the UK government will do little to put right. The UK is expecting 500,000 less new car sales this year. That is the state of the hole we are in.

Compare this to Germany where the government is subsiding people who want to sell old inefficient cars and buy new cars to the tine of 3000 Euros (£2500). This means that in Germany this year they are expecting to sell 200,000 more new cars this year than last year.

So perhaps Peter Mandelson should shut up and listen rather than giving lectures.

Update : Iain Dal e-mailed me very late last night to tell me that I had spelt "shut" with an "i". A Freudian slip from me ?

The truth the Tories won't acknowledge

Vince Cable pointed out at the Lib Dems Scottish conference that whilst the Tories might be apologising now for calling for less scrutiny of banks and the City of London and for not seeing the current financial crisis coming, there is something the Tories don't want people to know. Speaking about "Call me Dave" Cameron, Vince said

"It would have been rather bigger of him if he had also admitted that the Liberal Democrats did see this coming, and we did warn about it,"

Indeed I seem to recall the Tories attempting to ridicule Vince Cable for what he was saying 18 months ago. Still, when your party is essentially funded by hedge funds managers and people with their noses in the trough in the City of London, you cannot expect the Tories to really do anything about it.

Crazy mortgages - You read it here first !

I note that Gordon brown has spoen out against 100% mortgages whilst Tories too are jumping on the bandwagon to attack crazy loans that their party had no problem in supporting a few months ago.

I'd just like to point out that I made the point HERE back in November 2006 !

Step aside Vince Cable.

Agreeing with Ken Clarke

You can't argue with the logic of what Ken Clarke said today about the merger of HBOS with Lloyds. It does now seem that this merger, although an enticing prospect for Lloyds at the time, may result not in the saviour of HBOS, but the failure of HBOS and Lloyds.

The fact that ken Clarke was excluded for so long from the Tory front bench means he does come to the whole credit crunch debate with the freedom to speak his mind, but also with some gravitas, something the Tory front bench lacks at the moment, someone the press actually believe and go to for real information, not spin. At the moment the press really only have one port of call for a political expert on the credit crunch, and that is Vince Cable. Perhaps Ken Clarke might be able to get some of Vince's action. However, as Paul Walter points out, Ken has not really moved with the times. He mumbles and "erms" his way through interviews lacking the incisive direct point that Vince Cable hits so often.

So whilst I agree with him on Lloyds, perhaps it is clearer to see why he has been away from the front line for so long.

For me, Ken Clarke was the obvious choice as Tory leader in 1997. At a time when people did not like the Tories at all, he was the sort of leader who would have made them credible (something they never were under William Hague) and not loathed.

Tories rewriting history

We shouldn't be so shocked that a Tory employee attempted to change an historical fact on Wikipedia , instead we should be more worried about the Tories attempt to whitewash their past and claim the oral high ground in the wake of the credit crunch.

on BBC Radio Five Live this morning George Osborne simply ignored Nicky Campbells questions regarding Tory leader David Cameron speeches from less than two years ago when he criticised attempts to regulate the City of London and the banks. The presenter seemed to have a list of speeches and dates from Mr Cameron which Osborne had absolutely no answer for other than to say "but we do want proper regulation". It seems clear that the Tories are desperately hoping that nobody examines their "light touch" policy on The City in too much depth.

Osborne tried to justify the Tories high moral line by arguing that under Tory governments in the past no banks went under. Sadly it seems that someone who wants to be the Chancellor of the Exchequer has never heard of the Bank of Credit & Commerce International (BCCI), a large bank which although foreign owned, was based firmly in London which under a Tory government (and virtually no monitoring or regulation, as is the Tory was) went bust. Though no HBOS, BCCI went under in relatively bening times and without the Tory government having a clue that it would happen.

the Tories would be much better off holding their hands up and saying "We were wrong on regulation and we now see the need for it" rather than denying their guilty secrets and making us all suspicious of whether we can believe them about anything.

Bonus arguments show bogus logic

The fact that the head of Barclays Bank thinks bank bonuses are a good thing that should remain should come as no shock to anyone. It is like asking the head of Cadbury's if people should buy chocolate or a Premiership footballer if he thinks footballers are overpaid. But the argument she gives just do not hold water.

The most often used argument from those who support bonuses for the fat cats in the city is that "if you don't pay them the going rate, these people will go elsewhere", but this argument holds no water at all now as bonuses around the world have been slashed. Very few companies, if any, will be paying massive bonuses to its fat cat executives so how can they maintain this as an argument.

Then there is the argument that "banks will not get out of this mess if they lose all their best people", but as I have already pointed out, other banks are not paying bonuses so there is little chance of these people leaving to go elsewhere.

And finally, there is the argument that "success should be rewarded", which might be true were it not for the fact that the "success" these banks talked off were the very things that later put the banks in to such a sorry financial state. So many executives received benefits last year and in previous years for their investments in sub prime. If banks cannot differentiate between good work and bad, then bonus payments make no sense other than being a way for banks to reward themselves, not success.

We all know that the city has no morals and no ethics and we should not be surprised as bankers greed. The saddest thing is though that the government seem so toothless to stop the city and we, the taxpayer, are paying the price.

Why are banks offering such expensive loans

I got a letter today from my bank offering me a car loan.

Now you would imagine that with interest rates at an all time low a need for banks to restart lending in order to kick start the economy, that bank loans ought to be cheaper than they were in the past. However the rate highlighted as the typically APR was 0.6% higher than the rate I could have got last year.

Is it any wonder that consumer spending is stalled and nobody wants to buy a new car when car loans are so much more expensive.

Inflation - A well know fact that the government ignored

Why did it take the government so long to understand that their failure to act promptly a few months ago has actually made the recession worse.

Last April I predicted that the failure to cut interest rates was tying people in to long term fixed rate mortgages (and 80% of people are on fixed rate mortgages) so the government's sudden recent drops in interest rates are only benefiting 20% of mortgage holders, and is therefore having very little impact in providing a fiscal stimulus.

I repeated the point again in July, but still the government were oblivious.

Now we are in a situation where 80% of people are locked in to high mortgage rates for the next 3-5 years, thus making what might have been a short recession in to a long term depression.

And all these problems have been caused in the name of fighting inflation, which everyone knew would soon drop once the recession started. You only have to look at the precedent of the mini credit crunch Japan suffered a few years ago for a real example when inflation turned to deflation, yet our government was blind to this.

Whilst I cannot for one moment follow the Tory line that this worldwide recession is the fault of Gordon Brown, I am of the opinion that all the government action now is necessary in order to make up for their lack of action as the recession started.

They are not green shoots

So one Labour peer seems to think she has seen signs of green shoots in the economy. I think we would all disagree. They are not green shoot, they are a dead plant.

By the way, what a fabulous name Baroness Vadera is, it sounds like the female other half of Lord (Darth) Vader.

You could just imagine them being announced at a function "Lord Vader and Baroness Vadera".

Probably the last person the tories wanted to hear today

What a pleasant surprise it was to hear Lord (Norman) Lamont on the radio bemoaning the lack of a consistent policy from the government in the midst of the current economic crisis. It was pleasant simply because it reminded us all that it is not just the Labour party who are capable of massive mismanagement of the economy and the treasury.

To hear Norman Lamont go on about the government lacking a thought through policy and failing to give policies a chance to work was almost hilarious given the fact that Norman Lamont (ably assisted by David Cameron as one of his key advisor) managed to squander billions of pounds of tax payers money on one single day (Black Monday) in the early 1990s and famously changed interest three times in one day.

Yes, when it comes to economic advice, the last person we should be hearing from is Norman Lamont.

You could almost imagine the shock on the faces of people in CCHQ when they heard that the man who reminds everyone of Tory mismanagement of the economy was spouting off. Surely the last person they wanted to hear from.

Disgraceful threats from Woolworths administrators to Woolworths staff

Every day that the news media broadcast information about the ongoing Woolworths closures, we are told that Woolworths staff have been threatened by the administrators that if they talk to the press they will receive less redundancy pay.

What a shame that this sort of blackmail can be allowed.

Why Zavvi were deliberately ripping off their customers in the run up to administration

It seems pretty clear now that Zavvi, the music and video game retailer that went in to administration in Christmas Eve knew for some time that they were about to go in to administration, but what seems incredible is that they were in the run up to this actively ripping off their customers in a very premeditated way.

Shockingly by deliberately going in to administration in Christmas Eve, many thousands of people who received gift cards for Christmas were never going to be able to use their gift cards, and with the administrators also refusing to issue refunds or exchange good (even faulty goods so I have been told) then they also duped on customers again knowing that people were bound to return goods in the days after Christmas.

This deliberate action by Zavvi shows that the people who ran this company really cared little for their customers. It might have been the collapse of Woolworths that led to Zavvi's collapse, but the management of Zavvi ensured through their actions than many thousands of people had their Christmas ruined. What utter scum.

Remorse from banks ? My arse !

The head of Citicorp bank says that banks feel "remorse" for the crisis they have helped create. What a load of old bollocks.

Any idiot could have seen that a bank with £1bn in reserves being able to loan out 30 times this amount and calling itself an "investment bank" was playing fast and loose with the financial system. Why banks are sorry is that their bonuses have been cut.

Religion and Politics - A mix that never works

When a report comes out from any group which has legitimate and objective criticisms of the government, then it usually ought to be given a fair hearing. However, sometimes, despite the fact that I might agree with 100% with what they say, when it is a religious report, I have deep concerns.

The Bishops responsible for the report highlight concerns about Labour's obsession with money and further worries about the fact that Labour seem to thing that the consumer route is the way for the country to dig itself out of recession. Both of these I agree with. But then my sensible side kicks in. Labour may be morally bankrupt, but why are priests lecturing us on the economy and how the government should be run ? Why are religious leaders taking an overtly political stance in condemning the government ? And why are the Church of England at this time not trying to turn round the decline in the number of people going to church rather than claiming to understand how the economy should be turned round.

I have always felt politics should be kept divided from religion as the answers to today's problems cannot be found in a 2000 year old book.

Stop bailing out foreign companies

I asked a few weeks ago why the UK tax payer was being asked to loan money at a preferential rate to Santander, a Spanish bank, when it appears to me that the Spanish Government ought to be doing this. So I am equally perplexed as to why the UK taxpayer is now being asked to provide emergency loans to foreign owned car makers.

According to reports, the UK government is to provide funding to the billionaire Indian owner of Jaguar/Land Rover. Why are we bailing out billionaire Indian businessmen ?

Reports state that similar support fro the car industry has happened from governments in Sweden, France and Germany, but the reports fail to distinguish between the fact that these countries have domestically owned cars companies of their own, whereas we do not.

If Land Rover and Jaguar needs support then the government should make the loan dependent on the UK government getting a % of the shares and also a share in future profits in the company.