EU Referendum

Showing posts with label public spending. Show all posts

Hadley+Trust[i-Hadley+Trust]A good test for this new government will be a report produced by the Centre for Crime and Justice Studies at King's College, London.

It is picked up by, amongst others, The Daily Mail, from which we learn that police are using dishonest methods to boost their pay, mainly through a series of overtime scams.

Thus, while over the last decade, the number of police officers employed has risen by more than 15,000 to 142,151 with more than 16,000 police community support officers also being recruited, there was no decline in overtime.

Instead, we have seen spending on overtime soar to almost £400 million last year compared with £209 million in 1999, in the overall context of spending on police having risen from £9.3 billion in the financial year 1998/9 to £14.55 billion in 2008/9 - an increase of 50 percent.

Interestingly, most of the bill has been picked up by local taxpayers through the police precept element of their council tax, which is something we have seen year-on-year.

We have, thus, a situation where, each year, the police put their hands out for more money – essentially to fund corrupt practices – and then turn up on your doorstep to arrest you and put you in jail when, finally, you refuse to pay for a service that is rarely provided.

Unwilling to go to jail yet again, we take the stance of refusing to pay until the bailiffs actually turn up on the doorstep, a small but ritual annual protest that at least makes a point, even if it is routinely ignored by officials who issue warrants in the name of "customer services".

The test for the government, then, will be whether it can break from the Labourite cycle of throwing more money at public services in the expectation that they will get better, and impose a discipline that seeks to obtain better for less, cutting the huge amount of waste, flab and – in this case – corruption that has accrued.

At this stage, our expectations are extremely low, not least because we still see the ritual cry for more spending on "dog whistle" issues such as law and order and defence, and very little appreciation of value for money. When, or if, we actually start seeing improved services AND a decrease in taxes, then we will have change we can believe in.

For the moment, the evidence is that we are to plenty of increases in taxes, and none at all – as yet – that there will be any improvements. We watch and wait.

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BritishBAe146STA[i-BritishBAe146STA]Opposition by innuendo continues apace, with shadow chancellor George Osborne today picking up the baton briefly wielded by Liam Fox, to hint that he might cut three of Britain’s biggest defence projects, with a combined value of nearly £30 billion.

The axe, Osborne is suggesting, could fall within weeks of a Conservative administration being elected, and in his sights is £20 billion for the Eurofighter, £4 billion for the two Royal Navy aircraft carriers and £2.7 billion for the A-400M transport aircraft.

This, though, is highly tentative, as the shadow chancellor admits that he does not know what the "break clauses" in the contracts would involve, if the projects were scrapped.

In fact, the RAF as already acquired 55 Eurofighters, costing £3.8 billion and the rest of the order is widely thought to be tied in to stringent cancellation penalties which would negate any possible savings. Similarly, the MoD has already spent about £1 billion on early work on the two aircraft carriers, and there would doubtless be penalty clauses in place if work was abandoned.

Not mentioned though is the F-35 order, slated at approaching £10 billion. Presumably some would have to be cancelled if the aircraft carriers were ditched, although the RAF might want more aircraft to pick up on the capacity which would otherwise be delivered by the Navy.

As to the A-400Ms, the precise status of the commercial dealings between the government and Airbus is a closely-guarded secret, but even if the UK walked away from the project, it is not clear whether the £500 million already invested would be returned. Even if it was, cancellation would release very little money. The RAF desperately needs lift capacity and either or both C-130Js or C-17s would have to be bought to make up the shortfall.

Offering some possible flexibility, however, is BAE Systems which is offering a militarised version of its BAE 146 regional jetliner (pictured), with converted airframes available for the knock-down price of £3 million apiece.

BAE Systems at present owns some 47 of these aircraft, leased to regional airlines, but many of them are soon to be released as the airlines acquire new equipment. Conversion costs to military specification, including a cargo-carrying capability, are relatively modest.

Furthermore, the BAE 146 was designed for short-haul operations out of regional airports with tight noise restrictions, so it is capable of making steep climb-outs and descents, and can operate from short, unprepared airstrips with minimal modifications. This makes it optimal for military uses, albeit it can only carry half the load of a Hercules and it lacks a rear loading ramp.

However, acquisition of a number of these aircraft could be sufficient to ease the pressure on the current RAF fleet, especially if they were pooled with other coalition aircraft in Afghanistan, allowing C-130s from other nations to be used when needed, in return for BAE 146 capacity.

Innovative options such as these would seem to offer more scope for dealing with the current defence crisis. If not saving money in the longer-term, they enable cash flow to be managed, deferring major expenditure and flattening the peaks. Slowing down the Eurofighter production and stretching the F-35 programme – which has not in any event been finalised – while proceeding slowly on the carrier build – would have like effect.

Mr Osborne, therefore, has not necessarily sketched a path to salvation and, in fact, may be all at sea when it comes to cutting government spending. The need for a scalpel rather than an axe is indicated, but whether he has the skill to wield this precision tool has yet to be demonstrated.

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hacking[i-hacking]We give far too little acknowledgement to the excellent site, Burning our Money, which toils away in the vinyard, coming up with some seriously good material which puts the MSM to shame.

Today Wat Tyler explores the difference between "hacking" and "slicing" – two different mechanisms for cutting expenditure in an organisation (such as the government). Briefly, one can be described as across-the-board cuts while the other is targeted reductions.

The cowardly – and wholly ineffective – way is "hacking". This simply passes the grief (and the decision-making) down the chain, resulting in unintended consequences. And rarely by this mechanism is there achieved any long-term savings.

Tyler's piece has such resonance because I can recall in local government service being on the receiving end of "hacking". Down came the instruction that there was to be a ten percent cut across the board and, since our biggest overhead was salaries, the axe fell mainly on staffing costs. A recruitment "freeze" was immediately instituted, which meant that no vacant posts were filled.

Now, like most hierarchies, our department had at the base of the pyramid the field workers, the inspectors and technicians who actually went out and did the job. They were supervised by senior officers, who in turn were supervised by divisional officers who then reported to the deputy chiefs who were responsible to the chief.

In the nature of things, the most fluid part of the pyramid was the base, where job mobility was high. Higher up the chain, people rarely left – they had high-paid jobs and many would never get an equivalent elsewhere.

Thus, in a very short time, gaps started appearing in the lower ranks. But none of the seniors left. Gradually, the department became unbalanced, with an acute shortage of field staff supervised by a proportionately greater number of senior officers, who of course never went out of the office to get their hands dirty.

As our field staff dwindled, the work stacked up and the complaints from the public about the poor service started flowing in, the bosses came up with the perfect answer. We would target the highest-profile jobs, where we were dealing directly with the public, and deliberately delay our responses by 24-hours.

Under this regime, instead of a same-day call, we would leave it until the next day, then turning up with profuse apologies, blaming the "cuts". It was not long before public pressure became so great that the recruitment ban was lifted and we were back up to strength, the departmental structure unchanged.

Under a "slicing" regime, the obvious solution would have been to get rid of the divisional officers, which would have saved a fortune and improved the efficiency of the department, freeing us from endless red-tape generated just to show the big boss how effective were the middle-men.

But that was never to be. That would have meant structural changes and unpopular decisions. Not even the rank-and-file – with their eyes on eventual promotion and an easier life – wanted them.

And so it is in every public sector department. When the axe is wielded, it always falls at the sharp end. In the NHS, it is the cleaners, the nursing assistants, the doctors and nurses who go. The useless mouths remain. Similarly, in the Army, the bayonets are sheathed while the Colonels and Generals report unfailingly for duty.

"Hacking" is the coward's way out – the easy way - and it never works. But that is what always happens because there are no rewards in public service for taking "tough" decisions. But the next time some bureaucrat "apologises" for poor service and blames the "cuts", you will know better.

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