Picking Losers

According to the Telegraph, defence spending is lowest since the 1930s. Government figures show that 2.5% of the UK's GDP (About £32bn) was likely to be spent on defence in 2005-06 compared with 4.4% in 1978-88.

An MoD spokesperson said that the spending has increased in real terms. Obviously this is not enough to secure the efficiency of our defence forces and equipment. The UK's armed forces are clearly "overstretched" - it has 4 ongoing commitments (Iraq, Afganistan, Sierra Leone and Kosovo) operating with low levels of deployment and falling number of new recruits. Also, the current spending puts in risk the necessary renewal and upgrade of MoD's fleet.

Since the new government contract with GPs, the average pay for GPs is now more than £100,000. The new contract was designed to give general practices additional funds to invest in improving and developing services to patients. But it was not anticipated that GPs would take higher share of income in profits and would not use the money to imrpove the services.

GP earnings have risen 63% in three years but many of them have given up out-of-hours work, home visits, working during the weekends and on average a GP works only 44 hours a week (from the Guardian).

British film industry seems to be doing better than ever. The UK Film Council recently revealed that £840m was spent last year (up by 48% from 2005). Also more studios are coming to Britain. The change has occured after the introduction of a tax regime designed to facilitate low-budget domestic productions and lure big-budget investment. Gordon has been offering up to 20% tax relief to the film industry since 2005.

This is a fine example of government picking winners. Why does it consider producing films to be such an important industry? After all, it's existence is not in any shape or form crucial for the wealth of the nation and making films is still the prerogative of a small elite. Now the government promotes their business further.

Lord Wilson, a former Cabinet Secretary, is writing in today's Telegraph how Tony Blair has "brought in an increasing number of consultants at huge cost and created a dizzying array of units for modernisation and delivery, armed with centralised targets and league tables."  He argues that this has ruined people's trust in the Civil Service.

Gordon Brown promised in successive budget speeches

• to rebuild or refurbish all 3,500 secondary schools before 2020
• to spend £3bn a year on rebuilding or refurbishing
• to complete 100 schools by this year and 200 the next
• to sign 100 building contracts in 2006

But according to the figures obtained by the Conservatives, the schools investment programme has become mired in red tape. Nothing really has happened since Gordon announced the plans in 2004:

• not a single project has been completed
• the Government expects to open only 1
  

Wat Tyler posted an entry on his excellent Burning Our Money blog, pointing out that yesterday's interest-rate hike was a positive sign that the Bank of England Monetary Policy Committee were deciding to get back on top of inflation, not a disaster for an economy, as it was reported by much of the mainstream press. As usual, Wat is quite right, but I questioned the final part of his post:

"this time through all those pensioners, widows and orphans who've invested their savings in fixed income debt such as government bonds will be protected. For the first time since we abandoned the Gold Standard....Let us all give thanks for sound money."

I questioned not whether an increase in interest rates is necessary, but whether it is sufficient. Is it sufficient, for the purposes of maintaining sound money, to target changes in inflation indices with interest-rate adjustments, or can those inflation indices be misleading? In particular, I questioned whether expansion of the money supply and net sale/consumption of capital could conspire to give the appearance of only modest inflation (according to price indices) when the real value of our money and national wealth was falling faster than the indices indicated.

The Tree Council is calling for historic trees to be awarded "blue plaques" like historic buildings, concerned that "historic trees are left to wither and die".

Are blue plaques (or something equivalent) supposed to stop trees from withering and dieing? Can the Tree Council hold back the forces of nature?

The joy of protecting buildings is that owners are prevented from carrying out many essential improvements. Now owners of properties on which "historic trees" are located are to be faced with the same constraints.

It is reported today that Government reforms have led to patients being put at unnecessary risk by an over load of paperwork required by their carers. The British Medical Journal describes hospital wards as having "appalling conditions" and blames nurses for spending more time filling out paperwork that spending time on the wards.

All this negates the effects of a successful operation as many patients are catching hospital acquired infections or developing pressure sores.

"Doing nothing is not an option." So says the Government's spokesman, as an explanation for why they will press ahead with road pricing against strong public antipathy.

The culture of doing something because "something must be done" is what this site exists to challenge. Though it is endemic, you rarely hear this approach to government expressed so baldly.

There are arguments for and against road pricing. And there are arguments against those arguments. But "doing nothing is not an option" is no argument either in favour of any particular option, or against people who oppose that option. On that basis, you might as well stick your arm in the fire, because the flame is dieing and "something needs to be done".

Today's papers report that many schools are now achieving the government's target of five good GCSE's but the figures are much lower when maths and English are taken into account. Some schoolmasters encourage pupils to take easier subjects to gain a higher position for their school in league tables.

Tony Blair has promised to offset emissions from his holiday flights after opposition parties and green groups questioned his leadership on climate change. But offsetting emissions is not a solution to the problem. It is a great idea to pay for plating trees but it won't change our behaviour. Carbon offsetting only allows us to believe we can carry on polluting. Also, the timing is critical: "emissions saved today are far more valuable, in terms of reducing climate change, than emissions saved in 10 years' time, yet the trees you plant start absorbing carbon long after your fact

The re-elected Venezuelan president, Hugo Chavez, yesterday announced his plans to nationalise the main telecoms company and the likely nationalisation of a power company. The announcement is part of President Chavez's pledge "to radicalise his administration during his new 6-year term and fully convert Venezuela into a socialist state (FT)."  

This is what happens when you fund political parties using taxpayers' money:

The excellent Open Europe think-tank reports in its Daily Press Summary that the British National Party (BNP) are to receive a share of the £130,000 of funding that the EU has been obliged to provide to a grouping of extreme nationalist political parties. The entry of Bulgaria and Romania has given such parties sufficient representation in the European parliament to entitle them to the funding that is automatically provided by the EU to pan-European political groups.

According to the the Telegraph, HMRC has spent £7m on telling staff how to tidy their desks. This is part of a programme called Lean, introduced by consultants Unipart to improve the performance of civil servants more used to dealing with red tape. Some staff have reportedly black tape fixed to their desks to mark where items should be placed....

How can we be convinced the HMRC is fit for purpose if it needs to be told such things at the taxpayers cost?!?

The BBC reported last week of the poor state of military housing. A number of pictures of homes and barracks with mildew, broken pipes and cracked walls have appreared in the news and it is reported that servicemen are leaving the army due to poor accommodation.

Today's papers are reporting further mismanagement of the NHS. A leaked document has revealed that the government expects a shortage of nurses and GPs in four years but the NHS will have to reduce the number of hospital doctors to save money. Also, many trusts are cancelling and postponing operations and treatments to reduce the deficit for the financial year.

David Willetts, the shadow education secretary, has revealed through a number of parlimentary questions that the Learning and Skills Council (LSC) - one of the government's biggest education quangos - has "wasted" more than £100m on staff redundancies and on several internal re-organisations.

A Guardian survey has revealed that many councils are ignoring the threat of climate change and taking no action to reduce the rising carbon emissions of their residents. "The Guardian contacted all 442 local authorities in England, Wales and Scotland to ask whether they had any schemes planned to change household behaviour, either through incentives or penalties. Of 64 local authorities that responded, 30 said they had no plans to tackle emissions. A further 26 said they had introduced only limited incentives to encourage green behaviour, most of which are aimed at meeting government recycling targets. Only six local authorities said they were taking significant steps to curb household emissions."

The Times reports that many high skilled immigrants have failed to renew their visas due to the government changing the rules allowing such migrants to work in the UK. Since the introduction of the programme more than 20,000 people - mainly entrepreneurs, scientists and IT specialists - have moved to the UK and now the new rules are applied to them retrospectively.