So what are peoples thoughts and any potential impact on yourself

[Terry - Somerset]

To be honest I don't know enough about finances to know all the pro's and con's, and I'm only using your post as an example of numbers.

So the statement I see often is the rich are too rich and the poor are too poor (I'm not suggesting you said this), which in many instances I agree with. But using your example of a consultant having £1.25million in a pension, surely they are part of the rich with too much money.

I don't know how you change this without the problem that you highlighted i.e. that they just retire early, but I certainly don't have pity for someone with £1.25million in their pension being hit slightly more on tax.

There are lots of posts on here mentioning how businesses will have to close or reduce in size to save costs, but isn't the entire point that people at the bottom are paid more and the people at the top should reduce their salaries. I looked at a building companies finances recently and the directors were all on £500K+ with the top people on £1m. Yet these are the people who will lament about having to reduce their workforce because the company can't afford it. Perhaps if they didn't take 10x or more of the lowest salaries then maybe they wouldn't have to.

I worked in a secondary school and the head teacher and deputy was on £150k and £100K respectively! I was Senior IT tech on £23k (in 2020). I was scrabbling around repairing computers with old parts and the like. If they both dropped £10k off their salary the school could have bought new computers for the entire school. How terrible they would have to be on £140k and £90k salaries...

At age 60 a healthy individual can buy an annuity providing for some inflationary increases + a 50% pension to a surviving spouse at a cost of £100k for every £4500-5000 income.

For a consultant with £1.25m in their pension pot, this would generate an income of ~£60k pa before tax. Many would regard this as a very comfortable income - but for a high earning individual used to an income of £100k++ it is unremarkable.

If tax rules are a dis-incentive to work, we need to decide whether maintenance of the tax regime is more or less important than skilled staff. Particularly given the intention to increase NHS budgets it would be daft to lose these people to the health service.

 

[Sachakins]

Disingenuous. Do you really think that reneging or withdrawing from a promise to pay compensation for the contaminated blood scandal was a viable option? Most of the other unfunded spending promises were of similar ilk.

If they could CHOOSE to take the £300 off 10 million pensioners, then they could CHOOSE to change, alter, cancel the Tory proposals.
I'm not saying they should, but they chose to keep them, rightly for some of them, but they can't just blame the tories, they have to take responsibility for their choices.

 

[Windows]

Interesting this morning on BBC Radio 4 that a moderately sizeable business was pointing out that the additional payroll cost consumes a quarter of their pre-tax profits which are already low in terms of an acceptable return on investment. (Reducing corporation tax as a by product). The business response was all the usual things of cease recruitment, cut back on wage rises, close sites etc, which adversely affects probably the most vulnerable employees, but also, rather interestingly, outsource much more to India etc. They put it as transferring the employment cost out of the UK. This has been doing the rounds on business discussion groups and gathering momentum. It makes sense as then there is no national insurance costs and no employee protection issues at all.

When labour (or any party) gets into a fight with business, there are always unintended consequences. Politicians and civil servants usually have almost no idea how business actually operates.

Incidentally, when people like Jacob say the NHS is not for profit, this is also naive. The NHS buys everything in - all medical supplies, equipment, pharmaceuticals, agency staff and a great deal of scanning (MRI, PET CT etc) and all of these suppliers are very much "for profit" organisations. Because the NHS is not run as a business, procurement attitudes are different to those in commercial enterprise, as those responsible for procurement are not spending their own money. It is not dissimilar to defence procurement. Wasteful but no one cares as the public pays via tax.

No one who works in procurement as a speciality is spending their own money whether they work in the public or private sector. I’d be interested in seeing evidence of NHS procurement efficiency/inefficiency. Drug purchases have been reported as “efficient” as far as I’m aware. This is usually credited to NHS bargaining power (perhaps rightly, but also perhaps because economists have trouble acknowledging the skill & professionalism of people employed in the public sector).

 

[Agent_zed]

Many would regard this as a very comfortable income - but for a high earning individual used to an income of £100k++ it is unremarkable.

I can see what you are saying but it is also saying in other words rich people should stay rich because they are used to being rich.

Let's also remember that we are talking about a pension. This should be there to support you in later life after you've set yourself up with the expensive things such as a house. Anyone earning £100k+ for 30 years or so (£3million) should have been easily able to buy a house and a few nice cars with a load left over. I don't have any pity for someone who has got to 60yrs old who has been earning £100k+ and now has to 'survive' on a measly £60k.

 

[Jacob]

.... economists have trouble acknowledging the skill & professionalism of people employed in the public sector).

..not to mention commitment. And the huge accumulation of experience, skill, knowledge ("traditions" in the best sense) acquired over years, if not disrupted by manic right-wing ideology, privatisation, misplaced management shuffling, budget cutting, etc

 

[Terry - Somerset]

I think that's an over-simplification and doesn't really bear up to scrutiny - particularly when we know that many new treatments are not available on the NHS because they are "too expensive" and that the NHS does often wait until drug patents expire and they become "generic drugs" before the NHS is able to prescribe them.

The majority of the smart (unbiased) research and evidence concludes that the NHS costs less *overall* for the UK, despite notions to the contrary. It is also a national investment into labour (small l) which increases workforce availability - which is a fundamental key requirement of Capitalism.

The very notion that a private healthcare system wouldn't cost far more overall, plus restrict/prohibit access to the most needy, negatively affecting national health outcomes, creating negative knock-on effects to "business", and that private healthcare businesses wouldn't gouge the customer *directly* is a little bit optimistic, perhaps to the point of naivety, is it not?

I suggest you red this report by the Kings Fund comparing costs, funding methods and outcomes of 19 advanced economies Kings fund. In summary:

• NHS funding as a share of GDP sits lower than average
• It makes little difference how health care is funded (with the exception of the US). Most countries prioritise health care improvement within their existing funding model
• NHS outcomes are overall about average - some things better, some worse

Having worked in middle/senior management positions in the public and private sectors, I am firmly of the view that the public sector is relatively inefficient due largely to cultural issues:

• public sector is concerned with risk avoidance. Media attention on any deficient public sector actions (procurement, projects etc) tend to be high profile, damaging to both departments and individuals. Excessive bureaucracy is a defence against criticism.
• many (or most) public sector staff have limited external experience. They are house trained in culture and behaviours from the outset. New ideas are only reluctantly embraced. There tends to be a very positive identification with organisational goals
• private sector is concerned with profit and value. They accept risk as an inherent part of business. This can have negative consequences.
• personal rewards (promotion, bonus, pay) come through success. Get it wrong too often and you get fired. Public sector find it very difficult to deal with poor performance - employment tribunals etc risk attracting negative attention

Both public and private sectors have deficiencies and strengths. A far more helpful debate and positive outcome is likely by avoiding the dogma driven, and recognise the best each has to offer .

 

[jetsetwilly]

Well it has been delivered and so what are people thinking of this budget. What about the pension pot grab, you either spend it or stash it but if you leave any in your estate then 40% will be stolen by the treasury so not a great incentive for people to have large pension pots. Also all of those who employ people will now have to pay them more and pay more business national insurance so making it tougher for businesses and again taking away some of the incentive for startup's.

Can't wade through all of it just now, but I was pleased to see a decidedly leftwing budget that tried to redistribute wealth. I say tried because it's hard to predict what will happen. Would have preferred a broader protection of small businesses and less chipping away at the relief for entrepreneurs, and a blanket amnesty for carers with small retrospective transgressions over the earnings cliff-edge.

How does it affect me? I sold some shares to crystallise the CGT before it went up, and held the proceeds in USD in case the pound crashed - which it didn't. Now pondering the next potential earthquake over the pond, and reconsidering our plan to buy a new rental property as BTL was already a risky venture before the hike in ADS.

 

[jetsetwilly]

yep. they like the tax relief but not paying it. Many just have these soley as passing on to kids to avoid the tax. A loop hole plugged hopefully, though personally I would like to see their pension pots sucked dry by care home fees as afterall many claim its for their old age. £1800 pw care home fees near me. More than £23k savings then self funded I was told when looking after my elderly mum, no help whatsover, bought everything from hoist to nappies. Cuts cuts cuts to social care help. Pure evil.

Been through that, a harrowing experience and one that made me question the care home business model - the fees are eye-watering and the fact that the care home does best out of residents that die before they run out of cash makes me distinctly uneasy. I was disappointed to see no mention of structural social care reform yesterday but I guess the budget isn't really the platform for that.

 

[Jacob]

I suggest you red this report by the Kings Fund comparing costs, funding methods and outcomes of 19 advanced economies Kings fund. In summary:

• NHS funding as a share of GDP sits lower than average
• It makes little difference how health care is funded (with the exception of the US). Most countries prioritise health care improvement within their existing funding model
• NHS outcomes are overall about average - some things better, some worse

Having worked in middle/senior management positions in the public and private sectors, I am firmly of the view that the public sector is relatively inefficient due largely to cultural issues:

• public sector is concerned with risk avoidance. Media attention on any deficient public sector actions (procurement, projects etc) tend to be high profile, damaging to both departments and individuals. Excessive bureaucracy is a defence against criticism.
• many (or most) public sector staff have limited external experience. They are house trained in culture and behaviours from the outset. New ideas are only reluctantly embraced. There tends to be a very positive identification with organisational goals
• private sector is concerned with profit and value. They accept risk as an inherent part of business. This can have negative consequences.
• personal rewards (promotion, bonus, pay) come through success. Get it wrong too often and you get fired. Public sector find it very difficult to deal with poor performance - employment tribunals etc risk attracting negative attention

Both public and private sectors have deficiencies and strengths. A far more helpful debate and positive outcome is likely by avoiding the dogma driven, and recognise the best each has to offer .

Missing the point really.
Which is that the public sector health supplies services which the private sector is simply unable to, because it is not profitable and an effective health insurance would cost far more than most can afford.
It's not either/or, it's about how to make public services effective, ignoring the dogma from the right.

 

[Terry - Somerset]

I can see what you are saying but it is also saying in other words rich people should stay rich because they are used to being rich.

Let's also remember that we are talking about a pension. This should be there to support you in later life after you've set yourself up with the expensive things such as a house. Anyone earning £100k+ for 30 years or so (£3million) should have been easily able to buy a house and a few nice cars with a load left over. I don't have any pity for someone who has got to 60yrs old who has been earning £100k+ and now has to 'survive' on a measly £60k.

I have no pity either.

The individual earning £100k+ may get used to replacing a premium car every three years, holidays in prestige locations, nice food, etc. Contrast a more basic income - say £25k - can afford the basics but limited discretionary spend- eg: any car that starts and goes is good!

I buy into a pragmatic reality that folk with high and specialist level skills have the power to command relatively high salaries, and the capacity to find alternatives if they choose.

Hospital consultants (for instance) fit this model. Fail to reward them appropriately and they have very marketable skills - private health care either in the UK or overseas.

One could debate endlessly whether this is fair - but it is how the world works - not just the UK but in just about every other society.

 

[Terry - Somerset]

Missing the point really.
Which is that the public sector health supplies services which the private sector is simply unable to, because it is not profitable and an effective health insurance would cost far more than most can afford.
It's not either/or, it's about how to make public services effective, ignoring the dogma from the right.

It's taken you 13 minutes to read, digest and form conclusions about a fairly complex 120 page report. Either you are a:

• very fast reader with exceptional analytical ability,
• or haven't bothered to read it, preferring to trot out the same old nonsense.

 

[AJB Temple]

Health insurance is possibly only not affordable because the tax burden is so high and we shoulder the cost of treating people who have contributed nothing. I've never seen it properly costed out. NHS is a bottomless pit: aging population, increased expectation, falling birth rate (fewer tax payers eventually), much higher obesity, issues from UFPs and so on. NHS has no hope without major changes but it is an emotive area and politicians dare not do much except chuck money at it.

 

[paulrbarnard]

Did I. All I did was report it, not explicitly complain about it. <shrug> I don't like it, that's true, but I cannot see a realistic mechanism to curtail that, other than not buy the equipment in the first place, and create the knock-on effects of negatively affecting health outcomes...

 

[Agent_zed]

I have no pity either.

The individual earning £100k+ may get used to replacing a premium car every three years, holidays in prestige locations, nice food, etc. Contrast a more basic income - say £25k - can afford the basics but limited discretionary spend- eg: any car that starts and goes is good!

I buy into a pragmatic reality that folk with high and specialist level skills have the power to command relatively high salaries, and the capacity to find alternatives if they choose.

Hospital consultants (for instance) fit this model. Fail to reward them appropriately and they have very marketable skills - private health care either in the UK or overseas.

One could debate endlessly whether this is fair - but it is how the world works - not just the UK but in just about every other society.

But this is surely where change needs to happen. All that seems to happen at the moment is that there is a pay increase for the people at the bottom and then the people at the top somehow deem that incredibly unfair and demand the same or even bigger increase. Things then become more expensive and nothing actually changes.

I agree skill and knowledge should be rewarded to a point but I don't buy into the notion that CEO's and Directors on £500k are indispensable. They are rarely held accountable and just move on to another position of power when everything hits the fan. Sure they can leave the UK for somewhere that pays more but there is more to life than money. If you create a much fairer society and invest in the countries infrastructure it will benefit everyone including those that could be earning more somewhere else that may have fewer of these benefits than the UK.

 

[TRITON]

Labour in their first 3 months:

• demonstrated a gross lack of judgement over the winter fuel allowance
• a similar lack of judgement over their response to the expenses, clothing, football tickets, freebies revelations
• promised to live within the fiscal rules - now overturned
• criticised the Tories as the party of high taxation - now demonstrably proven untrue
• very selective use of language to defend massive tax rises not signalled in the manifesto

The B/S over £22bn black holes, and "we didn't realise it was so bad" - you are free to believe it if you want. They insisted they were going to end the chaos, had access to OBR, Treasury and other officials. It is simply spin predictably deployed to blame their predecessors.

They clearly share many of the political "genes" with the Tories. The only thing separating the two is 14 years of practice. Your faith in them is, I think, misguided.

Winter fuel allowance - Works out at a pound per day, which probably means one less bottle of vodka/month for your average pensioner.

Lack of judgement - not sure there is any. expenses, gifts are the same no matter which party is in power, only this round of government, the right wing media are reporting it. same media that didnt report on the previous governments expenses and gifts, so try not to of led in and gaslit

Critical of tories high taxes unproven you say. Have you been living in a cupboard ?. Tax under the tories, according to the tories is at its highest ever levels. GDP under the tories is at a much lower level, and please dont go blaming covid or the war in Ukraine. Other countries faces these same setbacks, and their economies are showing growth. at a much higher rate than the UK

Selective language - Hi there welcome to political manifestos

£22b blackhole bull****. it was independently calculated by the OBR.

Have you not walked up a highstreet and seen all the boarded up shops ? None of that was due to labour, it is 100% due to the tories destruction of our economy

As to my faith in them being misguided. I think I/we should wait longer than 3 months before making any judgement calls like that.

 

[Phil Pascoe]

Have you not walked up a highstreet and seen all the boarded up shops ? Ours were derelict before 2010.

 

[Phil Pascoe]

Winter fuel allowance - Works out at a pound per day, which probably means one less bottle of vodka/month for your average pensioner.

So the average pensioner is both wealthy and alcoholic. Right .....................

 

[Hypnotic Chimera]

If they could CHOOSE to take the £300 off 10 million pensioners, then they could CHOOSE to change, alter, cancel the Tory proposals.
I'm not saying they should, but they chose to keep them, rightly for some of them, but they can't just blame the tories, they have to take responsibility for their choices.

Change the Goalposts fallacy.
I asked specifically about the Contaminated Blood Scandal, for one (and also Post Office by extension) - these were not realistically within the realms of "choice" and were explicitly not budgeted for by Tory when the commitment was made. Amongst the other deliberately concealed unknown unfunded spending commitments were the cost of Public Sector pay rises - and NO, I'm not referring to any pay dispute settlements - that's just a common misinformation piece - I'm referring to just the normal 12 month-cycle pay review body reports. Most of the Pay Review Body reports were already published and simply placed in a drawer and not released or disclosed by Tory to the OBR. So the content of the Pay Review reports were an unknown unfunded commitment. Labour did "chose" to honour the recommendations of the Pay Review Body reports, but realistically, there is no precedent for not doing so - and whichever way they had chosen they would've been bummed relentlessly in the news rounds by the likely suspects either way... misinformation rules, right?

It was those kinds of things that really had to be honoured and brought into the costed budget instead of being left unfunded to be paid for out of the non-existent contingency fund. Like I said before - this is a mature and reasonable budget.

 

[Jacob]

Health insurance is possibly only not affordable because the tax burden is so high

Possibly not affordable because wages are too low, in some cases non existent - particularly with the unwell who may not be earning anything at all

and we shoulder the cost of treating people who have contributed nothing.

A very unpleasantly cynical view. We shoulder the burden of treating people in need. it's a very old fashioned idea I'm surprised you haven't caught up with it yet!

I've never seen it properly costed out.

What does that mean exactly?

NHS is a bottomless pit: aging population, increased expectation, falling birth rate (fewer tax payers eventually), much higher obesity, issues from UFPs and so on. NHS has no hope without major changes

Complete nonsense. NHS is working quite effectively but could be better supported.

but it is an emotive area

when it is under threat from the loony free-market neo-liberal right, not least because they offer no alternative

and politicians dare not do much except chuck money at it.

nonsense. The tories haven't chucked money at it - they've been underfunding, which is why there is a problem.

 

[Hypnotic Chimera]

I suggest you red this report by the Kings Fund comparing costs, funding methods and outcomes of 19 advanced economies Kings fund. In summary:

• NHS funding as a share of GDP sits lower than average
• It makes little difference how health care is funded (with the exception of the US). Most countries prioritise health care improvement within their existing funding model
• NHS outcomes are overall about average - some things better, some worse

Having worked in middle/senior management positions in the public and private sectors, I am firmly of the view that the public sector is relatively inefficient due largely to cultural issues:

• public sector is concerned with risk avoidance. Media attention on any deficient public sector actions (procurement, projects etc) tend to be high profile, damaging to both departments and individuals. Excessive bureaucracy is a defence against criticism.
• many (or most) public sector staff have limited external experience. They are house trained in culture and behaviours from the outset. New ideas are only reluctantly embraced. There tends to be a very positive identification with organisational goals
• private sector is concerned with profit and value. They accept risk as an inherent part of business. This can have negative consequences.
• personal rewards (promotion, bonus, pay) come through success. Get it wrong too often and you get fired. Public sector find it very difficult to deal with poor performance - employment tribunals etc risk attracting negative attention

Both public and private sectors have deficiencies and strengths. A far more helpful debate and positive outcome is likely by avoiding the dogma driven, and recognise the best each has to offer .

Yep - I kinda get where you're coming from and don't disagree with much.

A fair amount of "inefficiency" is built in by design - but only when if you deliberately disregard that the Public Sector have certain obligations to the public. For instance, as Armed Forces, when we are sent away on detachment/deployment we receive an amount of daily money for subsistence (food). I absolutely loathe the fact that our system is one of "capped actuals" that has to be audited by extra staff that we have to recruit in order to make sure we don't get a single penny more than we were entitled to spend. It costs the taxpayer double what it would cost to just give us £x per day - you know, like the majority of businesses do, because this is the most efficient and cost effective business model. However, I also understand that the public has a right to know exactly where the tax £ has been spent and this requires audit trails. So the premise and proviso is that you cannot treat all parts of Public Service like a business.

Similarly, we absolutely should not plan to pear-down the workforce to it's "smallest" or "most efficient" size in Public Services - some more than others, of course, because then they would fail to meet their objectives at the first hurdle.
For example, the any of the Emergency Services, if we ran them at a "steady state" of barest efficiency then they would fail to meet the needs of the next real public emergency.

So yes, some of your text makes sense, but the provisos above need to be included into the model and this is the reason behind "risk aversion" - quite rightly so - you cannot afford to risk not being able to respond to a serious emergency - and you cannot put a system in place which fails to meet the basic tenet of accountability of govt. Being critical of these basic tenets is unhelpful, because they are fundamental in the design and operation of Public Services.