"Be Thankful I Don't Take It All"

"Prime Minister, the Treasury does not work out what it needs and then think how to raise the money. It pitches for as much as it can get away with and then thinks how to spend it." 

Sir Humphrey, Yes Prime Minister.

That the government views the private purse as a magic money tree is an old age problem - one aptly illustrated by the rather bitter but not inaccurate Beatles' song, Taxman.

And it's a problem that becomes ever acute when under planned new measures in the latest budget. HMRC will have an automatic power to take money from a bank account when the holder has failed to act on four formal warnings requiring payment. Currently such actions can only be done with the permission of a magistrate or judge.

TBF senior still has an ongoing complaint with his local MP on this matter. With this in mind we note that the Telegraph today on its front page has another example of HMRC mistakes that expose deep flaws behind this proposal:

The number of people being investigated by the taxman has doubled in one year, raising concerns that people who have made innocent mistakes are being targeted by the Government.

HM Revenue & Customs made inquiries about the tax affairs of 237,215 people last year, compared with about 119,000 in 2011-12, figures obtained by The Daily Telegraph show.

The number of self-employed people investigated has quadrupled in that time while annual prosecutions have risen sevenfold in three years.

The figures are evidence of the attempts HMRC is taking to minimise the estimated £35 billion of tax lost every year.

Experts have warned that people who have made simple errors when filling out self-assessment tax returns are “an easy target” for HMRC.

Not unsurprisingly HMRC will go after the "low hanging fruit". They are more unlikely to resist and lack the means of fighting back successfully:

Mark Giddens, a partner at the accountancy firm UHY Hacker Young, said HMRC was focused on collecting tax from “soft targets” such as “teachers, doctors..." These taxpayers were more likely to settle without dispute, he said.

As Bill Cosby noted "the government comes for the regular people first".

Other mistakes are not uncommon and HMRC even loses our data. Naturally despite overwhelming objections, we still get the "reassuring" dulcet tones of the Treasury on transmit only:

"Although the vast majority do this, there is still a minority that chooses not to pay, despite being able. The proposed powers will give HMRC another tool to collect tax debt owed. The current consultation includes a range of safeguards to ensure the power is tightly targeted.”

"A range of safeguards". Not that would amount to a tin of beans of course. Who decides how to implement the safeguards? Well HMRC... However those in government tend to enthusiastically support such measures as they rarely experience the downsides of their actions because they have the money and the means to immune themselves from the consequences at the coalface that the rest of us have to endure.

And as the experiences of Complete Bastard fighting with South Gloucestershire Council over council tax very clearly shows not even the law is a defence - especially when it consists of willful corruption by the Police, Councils and Bailiffs in the cause of forcing people to hand over money which the state believes is theirs regardless. He quite rightly notes in conclusion:

Put simply, this is a government at war with its people.

Of course we as a people can rebel...and demand a better way of running our own country.

The Budget And HMRC (2)

Following on from TBF senior's complaint to his MP regarding the proposals in the budget of giving HMRC the ability to take money directly from our bank accounts in the event of a tax dispute, he has had a reply from his MP Andrew Jones and from David Gauke - the current Exchequer Secretary to the Treasury.

Unsurprisingly the responses have not been reassuring. Andrew Jones' letter can be found below (click to enlarge all images throughout):

Andrew Jones acknowledges that the response from the Treasury does not address TBF senior's original concerns; "I recognise that you have made other points which may not be covered by Mr Gauke’s reply". However he reassures us that we can rest in comfort that he does “meet regularly with the Treasury Ministers and will ensure they are aware of the further comments you have made”. That's ok then...

Mr Gauke's response is quite frankly disturbing. What is obvious from the response is that the Tories believe that the money "is the government's" - we have to prove otherwise. And we have to prove it with very much lower funds backing us should we have a dispute.

Never mind that tax avoidance is perfectly legal, and in large part a consequence of the 'wonderful' Single Market. Never mind that the lower limit of £1,000 of tax owed is a limit which is miniscule – thus it is clearly not a measure that is aimed at those deliberately evading large amounts of tax but normal people and small businesses.

But as a 'solution' we instead get confirmation that the Tories are attempting to turn the entire tax system on its head - "we're guilty unless we can prove otherwise"

Anyone who believes that their tax avoidance scheme works will still be able to pursue their claim in the courts. And, if they win, HMRC will repay the tax with interest. However, HMRC’s success in avoidance litigation shows that only a small minority of avoidance schemes are upheld in the courts. This means that it is fair that tax should sit with the Exchequer rather than the taxpayer during a dispute into tax avoidance.

Gauke says: "it is fair...". Who says it's fair? Certainty not us the taxpayer. Has Gauke ever attempted to fight HMRC as a small business owner...? I guess not. And of course HMRC never makes mistakes.

Needless to say TBF senior is not letting this go - belligerent persistence runs in the family.

The Budget And HMRC

With all the silliness on and immediately after 19th March surrounding the recent Budget and measures regarding Bingo and Beer duty it was tempting to ignore it - very much like Parliament will largely do contrary to their primary duty of scrutinising it.

However one particular measure – tucked away – demonstrated more than anything the absolute need for the Harrogate Demands:

Buried deep in the Budget document, there's a pretty significant HMRC power grab.

If officials decide you owe them money, they now have the ability to take it directly out your bank account. No insolvency proceedings, asset freezes or debt collection agencies. Just the government taking out whatever it thinks it's owed.

Anyone who has dealt with HMRC as part of a SME will read that and quake in their boots. With this in mind I post a copy of an email sent by TBF senior (an independent financial advisor of many decades) to his local MP in response - it articulates many of the deep concerns and frustrations regarding this measure:

The Chancellor’s recent Budget introduced radical pension reforms, a welcome help for savers and encouragement for businesses.  George Osborne continued his theme of ensuring that everyone pays their fair share of taxes.  It's one of the small proposals under the “Debt Recovery” section of the Budget that gives me serious concern.

It is proposed that new powers are given to HMRC so that they are able to access Bank Accounts of people who, allegedly, refuse to pay their taxes.  On the face of it this seems reasonable as people should pay their fair share of tax but this power is a fundamental change in the principle of British Justice.  In the UK, the courts decide the law and who is guilty.  If this power is passed to HMRC then they decide the tax that is due, determine that the person has consistently refused to pay and will then be given the power to raid their Bank Account.  In other words HMRC becomes the Judge, Jury and Executioner.

We have been told that there will be safeguards and this new power will only be used where HMRC have tried to contact the Tax Payer on a number of occasions and receive no response.  It appears that HMRC will decide whether or not these safeguards have been met and regrettably, their reputation for mistakes is well known.  There may be a simple and valid reason why a person has not responded such as they are in Hospital, they have moved house, they may have a mild form of Dementia or indeed HMRC may have the wrong records.

The lower limit of £1,000 of tax owed is miniscule for this draconian measure.  It will affect somebody who may have just had a company car, a change in respect of Child Credit or purely a miscalculation by HMRC in previous tax years.  This is not a measure that is aimed at the person who is deliberately evading large amounts of tax, it is targeting normal people and small businesses.

We are told that HMRC will leave a minimum of £5,000 across Bank Accounts and if this is also going to apply to small businesses, this could be purely the amount that is needed to pay their staff at the end of the month.

My understanding is that the Enterprise Act 2002 abolished preferential status for Crown debts from 15 September 2003.  This proposed measure could circumvent this by allowing HMRC to recover their debt in preference to the other Creditors by taking taxes from the individual’s account prior to insolvency.

HMRC already have powers to recover unpaid debts.  Why are they not encouraged to use them rather than giving them further power?  We are told that Tax Authorities in other countries such as the US and France already have this power.  This is no reason whatsoever for us to follow suit.  After all we live in Britain, not France or the US.

If we give this power to HMRC then what next?  There are many people that do not pay their Council Tax and therefore shouldn’t Local Authorities be given the power to take this money from their Bank Accounts.  After all we all have to pay for people that don’t pay their Council Tax.   How about Motor Insurance Companies.  We all pay additional premiums for people that do not pay for car insurance, so should they be given the power to deduct car insurance premiums from our Bank Accounts.  I am sure that MP’s from all sides of the House would be up in arms if this was proposed.

We have seen powers introduced in the past for what appears to be the right reasons but is subsequently used for other purposes. For example the Regulation of Investigatory Powers Act 2000 being used to catch people putting out their wheelie bins too early!  It might well be that the current Government is bringing in these new powers with every good intention but there is no guarantee that future Governments may not decide to use this power to implement further draconian measures.

As one of your Constituents, I urge you to oppose this new measure.  We do not want to have to wait until there is a public outcry over people who have suffered under these draconian measures.  There will inevitably be an inquiry with the usual infuriating reply that “lessons will be learned”.  For once, let us learn from our history lessons.  It is with some irony that with the 800 anniversary of the signing of the Magna Carta due next year, George Osborne is proposing that we give HMRC the power to determine the tax that is due and deduct it direct from Tax Payers without any recourse to an independent Arbitrator; a very dangerous step.

Of course both of us are under no illusions that any objections will make any difference, especially given the sycophantic nature to Cameron of his local MP. Yet again it demonstrates how broken our so-called Parliamentary democracy has become - at the next election there will really be only two contestants: the political class and the people. Oh how we wish for Demand number 5:

5. No taxation or spending without consent: no tax, charge or levy shall be imposed, nor any public spending authorised, nor any sum borrowed by any national or local government except with the express approval the majority of the people, renewed annually on presentation of a budget which shall first have been approved by their respective legislatures;

"Democracy Is A Minority Issue"

Both Autonomous Mind and Richard North have superb pieces on the arrogance of local councils, specifically Brighton and Hove, and their refusual to hold a referendum on any proposed council tax increase:

The referendum rule is mad. It’s not really workable and would cost about £300,000 to run.

As AM notes:

There you have it.  A sitting councillor who no doubt prattles on about ‘democracy’ and the ‘wishes of the people’ when trying to get elected, declaring that having to seek our democratic consent for a raid on our personal wealth, is unworkable.  In other words, the council should be allowed to demand what it likes and to hell with what residents think.

Quite. Though I guess there is one positive outcome - it is clear validation of at least one of the Harrogate Demands of "no taxes or spending without consent". Local councils would not be so vigorously against the idea of referendums if they did not work.

Arrogance and a sense of entitlement. Recently an acquaintance of mine has had a similar experience courtesy of Oxfordshire County Council via email albeit on a rather more modest issue than one of spending our own money.

As I noted in May the recent local elections saw the Conservatives lose control of Oxfordshire County Council which lead to one of the incumbent Tory councillors losing his temper at the count. Four Independents were elected but after the election three of the four opted to form a “Conservative – Independent Alliance” (Lynda Atkins for Wallingford, Mark Grey for Benson and Cholsey and former Labour Councillor Les Sibley for Bicester West), thus ensuing that the Conservatives would retain effective control of the council after a deal had been struck:

The alliance means the independents will support the election of Tory leader Ian Hudspeth on Tuesday and add their weight to the party’s budgets for the next four years, but they will not sit in the cabinet. 

Occurring as it did after the election had taken place meant the deal had no reference to the electorate's wishes and certainly had no mandate on which the independents were elected (interestingly the only independent who has remained so and upheld his promises is the one that represents me - but then I know where he lives).

The leader of this independent grouping (if that is not an oxymoron) is Lynda Atkins (from Wallingford) and she has publicly stated, in what is an attempt at some sort of a defence, the following (my emphasis):

It’s not an administration, it’s not a coalition, we’re calling it an alliance. We’re not joining the Tories. This is something which fits the current circumstances, something that will work right here and right now.

We believe that what we have done is very much in the best interests of our constituents and all the other residents of Oxfordshire. I think we always have to go back to our voters and explain our decisions, and this will be no exception.

A crucial element in explaining to voters decisions that have been made is to have the voting records of local councillors made as a matter of public record. I'm not sure how well known this is but there is no statutory requirement for councillors to record their votes. Conversely it is a matter of public record just how our MPs vote in Parliament (and indeed the EU Parliament as well) but there is apparently no such equivalent requirement for county councillors to demonstrate transparency to their electorates.

There is the option at county council for someone to publicly wish for their vote to be recorded in the minutes but crucially it is not compulsory - for most votes only the overall result is recorded. However, any councillor can ask for the way they voted to be added to the minutes. Similarly, if there's sufficient support among the councillors at a meeting, the votes of each member can be recorded.

As Oxfordshire County Council do not keep records of councillor voting records, not unreasonably due to the "deal" done, an enquiry was made via email to Lynda Atkins of which the following is an extract:

That in the interests of open, honest and transparent governance, you agreeing to the publication of your voting records is the only manner in which your electorates can have faith in your promises to hold the conservative minority administration to account.

After a delay in response and further promoting for a reply, Lynda Atkins eventually responded in a revealing manner (I publish her replies without permission in respect of her views of explaining decisions to the voters):

I prioritise emails and deal with non-urgent ones such as this when time allows, and am happy to take 3 or 4 days if that means I can focus on more urgent matters earlier.

The way in which County Council votes are taken is entirely different from that in Parliament, and recording who votes how is very cumbersome and time-consuming.  Yours is the only request I have ever come across (in 5 years on the County Council) for votes to be routinely recorded, so there does not seem to be a broad wish among residents for that to happen.  Given the problems of introducing a routine system of recording votes, I would not support it.

Intriguingly Atkins lets us know what she thinks are urgent issues as per the first paragraph, then makes assumptions on the "broad wishes" of residents (who actually may be unaware that votes are not recorded and would welcome them if informed that was the case), then with a flourish she decides that such a process would be "very cumbersome and time-consuming". Atkins presents no specific evidence of that of course and nor can she since she has no experience given Oxfordshire County Council do not implement such a system.

It's unacceptable that we have no public record of how councillors vote - using the excuse of cost to hide the workings of the council is simply arrogant, particularly in a public organisation with a budget of nearly £600 million. Ensuring transparency and accountability via voting records can be done relatively simply - for example recording such things in the minutes or by a method that the use of a piece of paper, pen and a pair of scissors cannot solve. The Ventnor Blog - Isle of Wight's local site - showed a possible low cost way in 2011:

We thought it would be helpful for you to know how your local councillor voted, so have built a system to let you know. We’ll endeavour to update it live as the votes are being taken.

Atkin's concerns therefore look suspiciously more like concealing her decision-making than a concern for public savings. Further reiterated by a subsequent email in response to one that pressed her on the above points:

All I can do is to repeat what I said previously, that you are the only person who has mentioned this as an issue.  I was not 'surprised' at your request, but I do believe that it is very, very much a minority view. 

Thus in the words of an "elected" councillor a moderate request for democracy becomes "very, very much a minority view".

Here we have a small number of councillors (three), holding the balance of power in Oxfordshire County Council who then refuse to let their electorates see just how they intend to support this failing council. Lynda Atkins' statement about “explaining decisions” is entirely worthless if she, and the rest, refuse to let the public know how they voted.

Cheering The Enemy

I was intrigued by this article by Donata Huggins in the Telegraph, articulating her shock at Gordon Brown being cheered at the Paralympics while George Osbourne was booed:

Crowds at the Paralympics this week booed George Osborne and cheered Gordon Brown. Yes, you read that right

Huggins is clearly astonished and baffled by this behaviour and doesn't understand so can only put forward the argument that it must be due to the stupidity of the British public, ill-disguised as this comment:

I cannot believe how short the public's memory is.

There is of course another explanation. When people have limited power they express their disaffection in the only ways available that they can. For example, when football fans fundamentally don't agree with their manager or board and have fallen out, they begin to celebrate opposition goals during a thrashing - as a way of trying to humiliate their own club. It's an expression which confirms powerlessness against vested interests.

Jonathan Aitken makes a similar point in his book, Porridge and Passion documenting his time in prison for perverting the course of justice, particularly when Michael Howard former Home Secretary visited him, which resulted in immature behaviour from the Prison Officers' Association:

The row between the screws and the Special Branch Officers continued for most of the visit, thereby alerting everyone in the room to this public spat between two traditional enemies: the police and the Prison Service. As a consequence, several prisoners decided to demonstrate their support for [Michael Howard my visitor].

As the visiting session ended with each inmate being called out by name, a dozen or so prisoners put on little demonstrations of respect towards the former Home Secretary. 'Good afternoon, Mr Howard,' 'Nice to see you at Standford Hill, Mr Howard,' 'Good to 'ave you with us sir,' and 'Thanks for coming to show yer loyalty to yer old friend, Mr Howard', were some of the bouquets tossed in Michael's direction by inmates passing our table as they left the visiting hall.

The point they were making was if the screws were going to be rude then the cons were going to be polite. It was a rather better point than any made that afternoon by the Prison Officers' Association.

So what better way of expressing discontent against Osborne than cheer on Brown who left him such a toxic legacy? Osborne the same chancellor who...er...didn't have successful budget in March and whose budget we the people pay for have absolutely no control over.

The only option left is to cheer a massively failed man in order to piss Osborne off. Such nuances though are above Huggins' head

Amateurs

I can't remember the last time a budget was still being talked about, and still controversial, months after it was delivered. But as the BBC reports, George Osborne has engaged in yet another Tory U-turn - I've now lost count:

The government has announced it will postpone its 3p-a-litre rise in fuel duty in August until January next year.

The move follows a campaign by road users' groups, who argued the increase would damage the economy.

Fuel duty will be frozen for the rest of the year, Chancellor George Osborne told MPs, adding that this would benefit families and businesses.

Labour, the SNP, Plaid Cymru and MPs from other parties had threatened to force a Commons vote on the issue.

The Sun newspaper and several Conservative MPs have also been pushing for a change of heart, amid concerns that prices at the pumps are squeezing living standards.

What's abundantly clear is that Westminster is infested by a bunch of amateurs, which at a time of Eurozone meltdown and an attempted power grab by the EU bodes well....

Another Fine Mess

From the Sky twitter feed, above is apparently the front page of the Daily Mail tomorrow.

I've often railed on this blog about the lack of acknowledgement of the EU in this policy (and many others) and the churnalism of press releases. Slowly but surely though, whether it's through persistent comments online pointing it out I don't know, but the MSM are now reluctantly acknowledging the tentacles of Brussels. However never did I expect a front page headline like that in the Daily Mail after so long in denial.

Whether the headline stays like that after the first edition goes out I know not, particularly when a panicking number 10 starts making frantic phone calls.

Highly amusing though is the original story was obviously an attempt to distract the media from the continuing fallout of the budget. And now the 'bury bad news' item is coming back bite Cameron. If he stands up to the EU to appear Eurosceptic, he'll be supporting an unpopular policy. Yet if he caves in he looks weak in the face of the EU and his Government's policy is dramatically highlighted as being in complete disarray.

He really hasn't got a clue - what's the opposite of the Midas touch?

How Convenient?

I predicted about 2 months, but the minimum alcohol price story has reared its head after only just a month. So why so soon?

On a separate note, George Osbourne and the coalition have taken quite a kicking over the budget, particularly the so-called granny-tax:

The full extent of George Osborne’s stealth tax raid on pensioners was laid bare yesterday.

Around 700,000 people turning 65 next year will be hit the hardest – losing £323 annually with the end of age-related income allowances.

In all, the ‘granny tax’ will take £3.5billion from the pockets of more than 4.4million pensioners. Senior Tories have denounced it privately as the Chancellor’s biggest blunder.

So how convenient then that a perpetually announced policy that never materialises makes the headlines this morning.

More 'Red Lines'

According to the Telegraph:

The government is fighting off new powers for the EU to summon George Osborne, the Chancellor, in front of the European Parliament to justify and defend Britain's economic policy.

The Treasury Minster says:

"The government would not accept any proposal for the European Parliament to be able to summon ministers to appear before it," said a spokesman.

"We are clear that democratic accountability is very important, however this is why we have national parliamentary scrutiny procedures, which the European Parliament must not eclipse.

It might be a red line for Britain but it is also one for MEPs and a deal must be done quickly before a summit on 24 June. Something will have to give and negotiations are very delicate," said a Brussels diplomat.

Leaving aside that 'red lines' leak like a sieve, what's notable about this article is the 'pride' that we are all supposed to feel because Osborne is allegedly 'standing up' to Europe - apparently we are all supposed to be grateful.

How low we've fallen as a nation.

Raw Deal

From today's Sun:


I'm not sure what's the more ludicrous EU story today, this or Cameron claiming that he'll veto the EU budget.

Please feel free to leave any Arnie / EU based puns in the comments.

138.9

That's the price of the cheapest local garage (Tesco) for me for unleaded petrol. Just before Osborne lowered the duty by 1p on budget day, the price went up 1p then it went back down at 6pm to the same price it was before Osborne's announcement - 133.9p. Since then it's gone up 1p a week relentlessly. Apparently with his budget Osborne wanted to inject:

"fuel into the tank of the British economy"

Well, I'm still waiting.

An Increase Is Still An Increase

The EU is dominating the news this morning and that is, as Michael White points out, bad for Cameron:

Watch out! Europe is back on the front pages. That's always a sign of trouble ahead – just what the coalition could do without, because it's a dividing line between the Conservatives and their Lib Dem civil partners...The PM now realises it is too late to prevent an increase in the EU's central budget – welcome to the real world

So much for Cameron's pledge of no bust up with Europe. The problem is that technicalities like this can glossed over but the budget increase is about something we can all understand; money. The anger in newspapers' comments is palpable, although much of it ill-informed, and not always a good barometer, there's no disguising the criticism. Even my wife, who's not politically interested, expressed her disgust this morning at the possible increase (expletives deleted).

Cameron will probably think that negotiating a reduction down to 2.9% or even 2% will be an achievement, but the problem is that unless Cameron can freeze or cut the budget then a rise is still a rise even if it was only 0.1%. And as Richard North points out Cameron is utterly powerless to even achieve that because it's the EU Parliament that will have the final say.

Our powerlessness will be exposed for all to see and at a time of deep anger with public sector 'cuts', a rise in our contribution to the EU is only going to help the eurosceptic camp.

Our exit has just got ever closer.

Boom!

As Fraser Nelson reveals in the Spectator one of the first of Labour's landmines, laid before the election, is primed to go off:

"Has Mark Hoban just become the first victim of the New Labour landmines? He was asked on the Today Programme whether the Treasury had conducted a formal study assessing the impact of the cuts on ethnic minorities. Hoban was speechless - as well you might be. But the assessment, he was told, is required under Harriet Harman's Equalities Act. Has it been carried out? He avoided the question and was asked it again. And so it continued, a la Paxman v Howard.

When Labour retreated, it sewed several landmines in the political territory it was about to cede. One of them was Harman's Equalities Act, which - as Pete blogged a while ago - mandates government "to consider how decisions might help to reduce inequalities associated with socio-economic disadvantage".

Of course if Cameron had any kind of backbone he would have abolished most of these acts the moment he came to office, but didn't - obviously too worried that repealing an 'Equality Act would've undermine the new 'cuddly' Tory image.

Fraser makes another salient point in this rather revealing passage:

In this way, Labour transferred power from parliament (where it was about to lose power) to the courts (where the lefty judiciary reign supreme). Their calculation was that if they did this quietly enough, and in technicalities, the Cameroons would not wise up to it because of their aversion to detail. Cameron should have repealed the Equalities Act instantly.

Aversion to detail? Great! That is going to be so helpful when they start dealing with the complexities of the EU.

The Mail reports today that a challenge to the budget may be about to start:

The Coalition is facing legal action against its Budget from an equality watchdog after analysts found it hammered the poor.

The Equalities and Human Rights Commission said it was considering whether to take the Treasury to court.

The quango said it feared Chancellor George Osborne had not investigated the impact of his Budget on vulnerable groups – such as women, the elderly, the disabled and ethnic minorities – as legally required.

The Treasury is also facing legal action from women’s rights group the Fawcett Society, which says ministers took no account of the Budget's effect on women.

Unelected Quangos are now gearing up to challenge the sovereignty of Parliament in the courts. Tom Harris is still bleating (in some ways understandably) about the inefficiencies of the IPSA, but in truth he and all the others might as well stick a great big sign outside the House of Commons saying: "Closed, until further notice".

Greece Is Not Leaving The Euro

Well not yet anyway. It appears that last night there was speculation that an announcement could be made regarding problems in the Euro, stemming from this tweet from Channel 4's Economics Editor. So much so that he later had to clarify:

Blimey. News is domestic UK, nowt to do with Greece... There's just an embargo to respect.

The 'significant' news was in fact the groundbreaking revelations that George Osbourne's budget would hit the poorest families hardest.

Budget On TV

Throughout the Budget, the above screen shot was typical of the television coverage. I thought where is Cameron? Osborne appears to be flanked by two Lib Dem MPs; Nick Clegg and Danny Alexander.

And then periodically the camera would show this, below:


Cameron is sat right behind Osborne's arse. Surely a coincidence on so many levels, (manipulation of the media is a Labour tactic, the Tories would never stoop so low?)

Gulp! Budget Day

The first budget for 13 years where Brown hasn't written it. So hopefully gone, is the deceit, the sleight of hand and the downright lies which have dogged every budget since 1997. Osbourne's budget apparently will do exactly what it says on the tin.

The coalition’s "Emergency Budget" is expected to included tax hikes and hard cuts in government spending. I argued during my election campaign that unless it was one of the most unpopular budgets in history the Government wouldn’t be doing its job properly. The scale of our deficit necessitates such a budget.

All the indications from the 'pre-Budget noises' are that reducing the deficit will be met by concentrating on cutbacks in the public spending, rather than tax hikes. Ushering in a new "Age of Austerity" (whatever that means), no government department will escape the axe, including the NHS, despite Cameron indicating during the election that spending on it would be ring fenced. The NHS will probably lose the services of many managers, and already a planned hospital has been cancelled.

Predictably the unions are already warning of hits to front-line services and subsequent strikes. Undoubtedly there will be some sort of impact on front-line services, but there’s plenty of scope in the public sector that can be cut without affecting them. The joke non-jobs for instance created by Labour; fruit and veg advisers, politically correct Quangos, diversity officers, weekend explainers, walking coordinators (seriously, I’m not making these up) and so on. Just by getting rid of useless Quangos could cut £13Billion.

Osbourne has an opportunity here, and some are getting excited by possible cuts ahead, but I have doubts as to how far he will seize it. We shall see.

Although Government spending is the main focus there will inevitably be tax rises. Taxes that I expect to see go up are; VAT possibly to 20%, Capital Gains possibly to 40% but more likely 30%, some sort of Bank levy and the obvious alcohol and tobacco (that will be another 2 of my local pubs closing). However, overall spending cuts are more important than tax rises which often generate less revenue the more they are raised and only encourage jobs to go elsewhere thus threatening the fragile recovery.

I never used to watch Brown's budgets, it was largely a waste of time as the details would often take days to unravel, but today I will watch, if only for one simple reason. Amidst all the economic gloom and pain, there is likely to be one amusing sight, that of copious amounts of steam emanating from the Labour benches as they get angrier and angrier while Osbourne wields the knife. Their faces are likely to be a picture. Expect to hear shouted phrases like; 'same old Tories', or 'they enjoy making cuts', or 'they're the party of the rich' and inevitably 'Ashcroft'.

What hasn't changed with the new Government is the leaking to the press. When Cameron said the UK budget should be presented to Parliament first (not the EU) what he really meant was that it should be presented to the UK press first. Whatever happened to Budget purdah, when leaks used to be a resigning issue?

What Does The EU Do Best?

...blame others and grab power. So says Marta Andreasen in today's Telegraph regarding the EU's insistence on scrutinising national governments' budget plans, including that of Britain. Marta's not optimistic, rightly in my view, that Cameron will hold out against the might of the EU. The whole article is well worth a read but here's her conclusion:

Mr Cameron has grandly declared that Britain would not allow Brussels first sight of the budget and that proposed hefty sanctions against countries breaching deficit and debt limits set by the EU must apply only to the single currency member states.

But don't hold your breath, because he is relying on six flimsy words of the summit statement - "taking account of national budgetary procedures" - to get him off the hook.

I am quite sure that, not just in his heart of hearts but even in private with his advisers, he has already acknowledged that when the next stage of the sovereign debt crisis hits, Britain will be called on to reach into its pockets.

And it will have no choice, because in truth EU integration has already gone that far - and British banks will be among the losers if a country defaults.

From my knowledge of the EU bureaucracy I have little hope that Britain will be spare from this demeaning procedure.

The 'referendum lock' will be another Cameron promise that will be filed under 'cast-iron'.

Fudge

David Cameron meets his other EU colleagues today, promising "positive engagement", but not at the expense of British sovereignty.

Up for discussion, among other things, will the EU's plan to vet the national budget and create the foundations for the total economic governance of all 27 member states.

As the Telegraph reports:

"British diplomats say that if implemented, the proposal would reduce UK sovereignty because it would be Brussels that would set a limit on the public finances and not British politicians."

After Cameron's assurances that any future transfer of power must be subjected to a referendum, today we'll have some indication how much backbone David Cameron really has. I'm not hopeful.

This is also where the Tory backbenchers will find out whether the PM is just good at patriotic rhetoric while stabbing them in the back, or whether he actually has ever meant any of it. (and whether any of them will care)

Personally I have a little prediction. As outlined in an older post, Tory negotiations with the EU (and to some extent Labour's) go something like this:

• Britain claims proposals are unacceptable.
  
  "Mr Cameron’s spokesman insisted that the Prime Minister would not accept any new limit in Britain’s ability to set its own budget. “Anything that could involve any transfer of power from Westminster to Brussels is not something we would be prepared to consider,”
  
  Check, so far so good
  
  
• Britain attends negotiations isolated, and so a row ensues.
  
  Mark Hoban, the junior finance minister, was isolated among the 27 nations last night when he told fellow EU ministers in Luxembourg that Britain would refuse to submit its draft Budget to the “peer review” system drawn up to prevent another Greek-style crisis.
  
  Check.
  
  
• Behind the scenes lots of horse-trading happens.
  
  EU officials now talk of a "peer review" of the assumptions underlying a budget. And in the draft summit document it mentions EU member states presenting their budgetary plans to the Commission each spring, "taking account of national budgetary procedures". There may be enough wriggle room here for the British to avoid a clash.
  
  Enough wriggle room? Check.
  
  
• Neville Chamberlain David Cameron will emerge waving a white piece of paper exclaiming that they have secured the required opt-outs for the City, and that they've got the best deal for Britain.
  
  We'll have to wait until later for this, but so far all is following the script nicely. What will then likely happen is this:
  
  
• It later emerges that far more was given away than won.
  
  
• Said opt-outs will erode over time, especially now EU law is supreme and thus they will leak like a sieve.
  
  
• Britain will, as a result, be integrated further into the EU supranational state.

In other words it will be fudged, but in such a way to appease the eurosceptics, but ultimately means Britain loses just a little bit more sovereignty.

Tell Me When I've Touched The Bone

Following on from yesterday's post, more evidence that the election was merely a pause in government affairs rather than a real change. The Daily Mail reports that:

More than half of councils are continuing to impose fortnightly bin collections, despite Conservative pledges to crack down on Labour’s ‘bin bullies’.

Which is, of course, no surprise as the changes to our bin collections are the result of EU legislation. Not that the Tories or indeed the Mail mention this, though some of the comments below the article are better informed.

Also in the Mail is the report that the Tories have accused Ed Balls of being to the right of Enoch Powell on immigration:

Education Secretary Michael Gove said Mr Balls had managed to 'outflank' the Tory leader to the right on both immigration and Euroscepticism, ' something not done since Enoch Powell was in this House'.

Hilarious if it wasn't so serious, at least though the Mail this time acknowledges the EU dimension:

[Ed Balls'] proposals would require the Lisbon Treaty to be amended - something which Labour had attacked the Tories for wanting during the election campaign.

I'm not sure how Mr Balls proposes to amend the treaty as it would require the permission of all the other 26 nations, which they have often indicated they would not do. A point missed by the Tories when they proposed returning powers from the EU back to the UK.

Most of the papers are running with the story I mention yesterday that the EU wants to vet the UK's budget before Parliament does, despite the UK not being in the Euro:

Mr Van Rompuy and the European Commission have tabled plans that will require all of Europe’s governments to discuss their budget plans with other EU finance ministers and officials before they presented to national parliaments.

“A government presenting a budget plan with a high deficit would have to justify itself in front of its peers, among finance ministers,” said Mr Van Rompuy.

This is such a clear infringement on parliamentary and national sovereignty - the power to set our own budgets how we wish - that that Van Rompuy should be told where to go in no uncertain terms. Below is an extract from an email from my Tory MP when I questioned him over the European Public Prosecutor:

if we win the next election, our first step would be to prohibit, by law, the transfer of further power to the EU without a referendum. Never again should it be possible for a British government to use a Treaty to transfer areas of power to the EU without the British people's consent.

...and that we must never allow Britain to slide into a federal Europe.

Vetting national budgets is a clear transfer of power, so what will Cameron do? Well the signs are not good:

An official insisted that the move would not lead to ‘unannounced dawn raids on national treasuries’.

But he added: ‘The new provisions allow for visits to check on the economic maths, if there are reasons for concern - such as national figures being revised at short notice without obvious reason - or other signals that something may be wrong with the calculations.’

A UK official said: ‘We originally rejected this idea, but we've now discovered just how bad the Greek situation was, and there's an appetite to make sure it doesn't happen again.

'A lot has changed in the last few months, and people are ready to accept some things that they would not have done just a short time ago.’

Chancellor George Osborne last night insisted he was on a mission of 'positive engagement' with Europe.

So more talk tough, act weak. And the EU will come back for more powers, then more, then more ad infinitum. At what point are the Tories going to say no? Well never it seems.

It reminds me of the "you crossed the line" scene below from the British hooligan film I.D. from which the title of this post is taken from. (as you would expect in a film of this nature some robust language in the clip).

Budget Thoughts

I wonder how long it will be before cider companies start doing a 'Pringles'.