Reply to: New Incompetence

[AlfredJPruffock]

Amusing equivalent here in Treasury land:

Real money behind Brown's tricks

Gordon Brown should learn a lesson from Father Christmas: if you are giving out goodies, it is best to do so quietly. That way, the little extra is appreciated. If, on the other hand, you make a song and dance about it - presenting the gifts in a flattering light - the recipients are disappointed when they get past the wrapping to the less glittery substance beneath.

This year, Gordon repeated his old school spending trick. It sounded very beneficent at first; closer examination showed it to be somewhat less exciting. The Chancellor managed to win headlines that suggested he was handing an extra £34bn to schools in England. But, as before, this is only strictly true if you discount the fact that many of the increases had already been announced.

The £34bn relates to capital spending, in other words money for buildings and equipment. It is based on the fact that if you add up all the money being given for capital spending over the next five years, it totals £34bn. But the increases for the first two years, some £12.3bn, had already been announced before the Budget. Moreover, the actual increase in the amount being spent each year is just £1.6bn, representing the rise from the planned £6.4bn for 2007-08 to just over £8bn in 2010-11.

Decide for yourself whether you think the increase is really £34bn or £1.6bn.

Imagine your pay is now £10,000 a year but you have already received a promise of a £2,000 a year increase in each of the next two years. A new boss comes along and says he likes your work so much that he will continue to increase it by £2,000 each year, from 2008-09, until it reaches £20,000 by 2010-11. Now, how would you describe the pay rise you have just been promised?

I think I would go home and say I had just been given a pay increase of £8,000 over five years, in other words the rise from the £12,000 a year I had already been promised to the £20,000 I will eventually earn. The Chancellor, by contrast, would go home and tell his family he was getting an extra £80,000. This would be made up of his total accumulated pay: £12,000 in 2006-07, £14,000 in 2007-08, £16,000 in 2008-09, £18,000 in 2009-10, and £20,000 in 2010-11.

That was presentational trick number one.

Trick number two was the impressive-sounding promise to raise spending on state school pupils to the same level as that spent on those in private schools.

Let us set aside, for the moment, the fact that the prime minister had already made a similar promise five years ago - when he said his "aim" was to "get to a situation where we have a state education system that is as good in its facilities and investment as the independent sector".

But what exactly did Gordon Brown's promise amount to?

The first point to note was that he gave no timetable for closing the gap. It remained a vague aspiration, as it was for Tony Blair five years earlier.

The second point is that Mr Brown only promised to raise state school spending, at some indeterminate date in the future, to the same level as today's private school spending.

Mr Brown was at least plain in setting out the size of this task. He said average spending per pupil in the state sector was now £5,000 (actually it is slightly less than that, but never mind). He compared this to the £8,000 spent per pupil in the private sector, a shortfall of £3,000 a year.

According to the financial think tank the Institute for Fiscal Studies, the spending increases already planned for schools, plus the extra announced in the Budget, will raise state school spending to around £5,600 per pupil. So that is a shortfall of £2,400 per head, which the IFS calculates will require an additional £17bn on top of already planned spending.

The IFS say that if spending grows only in line with the growth in the economy, that could take 16 years to achieve. Moreover that would only close the gap by 2022 if the private sector did not significantly increase its own spending levels over that period.

What this amounts to is an example of Political Confusopoly, ie a technique whereby due to an over elaborate arrangement it becomes impossible or too tiresome for the public to discern the issue,and thus are not in a position to pose a challenge or question the matter in hand.

An excellent example of this would be Pension Schemes, bamboozling by design in order to maximise their profits , then years later, when you realise youve been rumbled , its too late.

The IT industry excells at this too, making products and documentation which is deliberately Byzantine in order to safeguard commercial interests.

[The Master]

Amusing equivalent here in Treasury land:

Real money behind Brown's tricks

Gordon Brown should learn a lesson from Father Christmas: if you are giving out goodies, it is best to do so quietly. That way, the little extra is appreciated. If, on the other hand, you make a song and dance about it - presenting the gifts in a flattering light - the recipients are disappointed when they get past the wrapping to the less glittery substance beneath.

This year, Gordon repeated his old school spending trick. It sounded very beneficent at first; closer examination showed it to be somewhat less exciting. The Chancellor managed to win headlines that suggested he was handing an extra £34bn to schools in England. But, as before, this is only strictly true if you discount the fact that many of the increases had already been announced.

The £34bn relates to capital spending, in other words money for buildings and equipment. It is based on the fact that if you add up all the money being given for capital spending over the next five years, it totals £34bn. But the increases for the first two years, some £12.3bn, had already been announced before the Budget. Moreover, the actual increase in the amount being spent each year is just £1.6bn, representing the rise from the planned £6.4bn for 2007-08 to just over £8bn in 2010-11.

Decide for yourself whether you think the increase is really £34bn or £1.6bn.

Imagine your pay is now £10,000 a year but you have already received a promise of a £2,000 a year increase in each of the next two years. A new boss comes along and says he likes your work so much that he will continue to increase it by £2,000 each year, from 2008-09, until it reaches £20,000 by 2010-11. Now, how would you describe the pay rise you have just been promised?

I think I would go home and say I had just been given a pay increase of £8,000 over five years, in other words the rise from the £12,000 a year I had already been promised to the £20,000 I will eventually earn. The Chancellor, by contrast, would go home and tell his family he was getting an extra £80,000. This would be made up of his total accumulated pay: £12,000 in 2006-07, £14,000 in 2007-08, £16,000 in 2008-09, £18,000 in 2009-10, and £20,000 in 2010-11.

That was presentational trick number one.

Trick number two was the impressive-sounding promise to raise spending on state school pupils to the same level as that spent on those in private schools.

Let us set aside, for the moment, the fact that the prime minister had already made a similar promise five years ago - when he said his "aim" was to "get to a situation where we have a state education system that is as good in its facilities and investment as the independent sector".

But what exactly did Gordon Brown's promise amount to?

The first point to note was that he gave no timetable for closing the gap. It remained a vague aspiration, as it was for Tony Blair five years earlier.

The second point is that Mr Brown only promised to raise state school spending, at some indeterminate date in the future, to the same level as today's private school spending.

Mr Brown was at least plain in setting out the size of this task. He said average spending per pupil in the state sector was now £5,000 (actually it is slightly less than that, but never mind). He compared this to the £8,000 spent per pupil in the private sector, a shortfall of £3,000 a year.

According to the financial think tank the Institute for Fiscal Studies, the spending increases already planned for schools, plus the extra announced in the Budget, will raise state school spending to around £5,600 per pupil. So that is a shortfall of £2,400 per head, which the IFS calculates will require an additional £17bn on top of already planned spending.

The IFS say that if spending grows only in line with the growth in the economy, that could take 16 years to achieve. Moreover that would only close the gap by 2022 if the private sector did not significantly increase its own spending levels over that period.

[DimPrawn]

I let go of the law,
and people become honest.

I think Fungus the Bogey Man tried that and look where we are now.....

[AlfredJPruffock]

If you want to be a great leader,
you must learn to follow the Tao.
Stop trying to control.
Let go of fixed plans and concepts,
and the world will govern itself.

The more prohibitions you have,
the less virtuous people will be.
The more weapons you have,
the less secure people will be.
The more subsidies you have,
the less self-reliant people will be.

Therefore the Master says:
I let go of the law,
and people become honest.
I let go of economics,
and people become prosperous.
I let go of religion,
and people become serene.
I let go of all desire for the common good,
and the good becomes common as grass.

Tao Te Ching

[sasguru]

I really don't see what the problem is. Clear as crystal.

[John Galt]

The increase in overpayments from 2002-3 (when there wasn't any tax credits) to 2003-4 was 2.2 Billion.

The overpayments in 2004-5 was the same as the overpayments in 2003-4.

So the increase in overpayments was zero.

This is 2.2 billion less than the increase in overpayments from 2002-3 to 2003-4.

Well it's either that or

[sasguru]

Well you see it's like this:

The increase in overpayments from 2002-3 (when there wasn't any tax credits) to 2003-4 was 2.2 Billion.

The overpayments in 2004-5 was the same as the overpayments in 2003-4.

So the increase in overpayments was zero.

This is 2.2 billion less than the increase in overpayments from 2002-3 to 2003-4.

[BlasterBates]

The increase in overpayments from 2002-3 (when there wasn't any tax credits) to 2003-4 was 2.2 Billion.

The overpayments in 2004-5 was the same as the overpayments in 2003-4.

So the increase in overpayments was zero.

This is 2.2 billion less than the increase in overpayments from 2002-3 to 2003-4.

[Fleetwood]

Quoi?

[PerlOfWisdom]

After a massive increase in overpayments in 2003-4, the increase in overpayments for 2004-5 has been reduced by 2.2 billion.

Surely this is great news!

I have read this 4 times and it still doesn't make sense

The increase in overpayments from 2002-3 (when there wasn't any tax credits) to 2003-4 was 2.2 Billion.

The overpayments in 2004-5 was the same as the overpayments in 2003-4.

So the increase in overpayments was zero.

This is 2.2 billion less than the increase in overpayments from 2002-3 to 2003-4.

[John Galt]

It's not supposed to, that's the joke.

Aaaahhhhhh - now it makes sense - thanks Threaded.

[Mailman]

After a massive increase in overpayments in 2003-4, the increase in overpayments for 2004-5 has been reduced by 2.2 billion.

Surely this is great news!

So does the government count the difference between 2003-4 and 2004-5 as profit? After all...if its willing to count money that it hasnt made as a loss [tax avoidance schemes] then this sounds perfectly good to me

Mailman

[Mailman]

voilà

Fecken lucky I didnt spell it "wallah"!

Mailman

[threaded]

I have read this 4 times and it still doesn't make sense

It's not supposed to, that's the joke.

[John Galt]

After a massive increase in overpayments in 2003-4, the increase in overpayments for 2004-5 has been reduced by 2.2 billion.

Surely this is great news!

I have read this 4 times and it still doesn't make sense