Monday 24 December 2012
Saturday 22 December 2012
A Living Wage
The Living Wage has been in the news frequently after the figures for 2012 were published in November – and rightly so. It’s not a new idea though, the concept going back at least as far as 1894. 108 years on, The Living Wage Foundation is promoting its implementation and has done so for over 10 years. The new figure of £7.45 per hour is scarcely a king’s ransom but at least it is higher than the current minimum wage for adults of £6.19. That difference is important.
The Centre for Research in Social Policy calculates the Living Wage periodically by looking at the costs of a basket of goods and services that a family needs to reach a minimum acceptable standard of living. It covers more than just the items that are needed for rudimentary survival, such as food, clothing and rent. The calculation includes what is needed to reach a standard of living that is the minimum that is acceptable to a panel of members of the public. It is not at all surprising that this acceptable standard has gone down somewhat since impact of the financial calamity that began in 2008 continues to ripple through.
Almost all people wish to provide for themselves by working for a living (where work still exists and where jobs have not been exported by private sector companies or are being destroyed - as at Remploy – by government). In return, employees should clearly be paid a living wage for their work. People should be able to earn enough on which to live through their work alone. If companies want someone to do a job for them, then they should pay that person enough to reach the minimum standard.
The introduction of the Minimum Wage was a good first step towards paying a living wage, but the level is set too low for a family to live on. People on very low pay therefore often have to rely on support from the state to make ends meet. These benefits are effectively a subsidy to those employers who pay their employees less than enough to live on - with the balance taken from the pockets of the taxpayer. A Living Wage allows people to earn enough on which to live without the state having to intervene in yet another failure of the current rapacious and unprincipled version of capitalism.
All this of course stands in stark contrast to what typically happens at board level. There is an urgent need for sweeping, lasting and inescapable changes to the way in which top-level executives have their pay, bonuses and exit payments decided and the way that they are assessed for tax - and the many ways that legitimate tax is avoided both by individuals and companies some of whom pay less than the Living Wage.
It is entirely wrong that directors’ pay continues to rise at ten per cent a year while many employees are having their wages cut or frozen and their working conditions worsened. The values of fairness and responsibility should apply throughout companies, and in the setting of top-level pay there should be no further rewards for failure and no more huge and unwarranted executive pay increases – frequently made at the expense of low-paid workers.
The Fair Pensions' Just Pay! campaign aims permanently to embed Living Wage standards in the country’s private sector, beginning with the biggest companies listed on the London Stock Exchange, namely the FTSE 100. Companies today cannot be counted upon to do the decent thing of their own accord so it will have to be made a requirement to end the present injustice and exploitation.
The Centre for Research in Social Policy calculates the Living Wage periodically by looking at the costs of a basket of goods and services that a family needs to reach a minimum acceptable standard of living. It covers more than just the items that are needed for rudimentary survival, such as food, clothing and rent. The calculation includes what is needed to reach a standard of living that is the minimum that is acceptable to a panel of members of the public. It is not at all surprising that this acceptable standard has gone down somewhat since impact of the financial calamity that began in 2008 continues to ripple through.
Almost all people wish to provide for themselves by working for a living (where work still exists and where jobs have not been exported by private sector companies or are being destroyed - as at Remploy – by government). In return, employees should clearly be paid a living wage for their work. People should be able to earn enough on which to live through their work alone. If companies want someone to do a job for them, then they should pay that person enough to reach the minimum standard.
The introduction of the Minimum Wage was a good first step towards paying a living wage, but the level is set too low for a family to live on. People on very low pay therefore often have to rely on support from the state to make ends meet. These benefits are effectively a subsidy to those employers who pay their employees less than enough to live on - with the balance taken from the pockets of the taxpayer. A Living Wage allows people to earn enough on which to live without the state having to intervene in yet another failure of the current rapacious and unprincipled version of capitalism.
All this of course stands in stark contrast to what typically happens at board level. There is an urgent need for sweeping, lasting and inescapable changes to the way in which top-level executives have their pay, bonuses and exit payments decided and the way that they are assessed for tax - and the many ways that legitimate tax is avoided both by individuals and companies some of whom pay less than the Living Wage.
It is entirely wrong that directors’ pay continues to rise at ten per cent a year while many employees are having their wages cut or frozen and their working conditions worsened. The values of fairness and responsibility should apply throughout companies, and in the setting of top-level pay there should be no further rewards for failure and no more huge and unwarranted executive pay increases – frequently made at the expense of low-paid workers.
The Fair Pensions' Just Pay! campaign aims permanently to embed Living Wage standards in the country’s private sector, beginning with the biggest companies listed on the London Stock Exchange, namely the FTSE 100. Companies today cannot be counted upon to do the decent thing of their own accord so it will have to be made a requirement to end the present injustice and exploitation.
Wednesday 19 December 2012
How to Make Companies Act with Integrity
When considering private sector regulation it is sometimes asserted by vested interests and their allies in parliament that competition from a state owned enterprise, or one that was operated by what remains of Local Government, would be unfair to the rest. But as the continued ruthless exploitation of consumers demonstrates, an effect on the rest is precisely what is needed.
The financial barrow boys who misled the country and dragged down the economy - and who have since had further shameful practices exposed -are not alone. This ‘industry’ is just one example of the unprincipled way in which private sector outfits now operate. Effective action – not simply cosmetic – needs to be taken if the interests of ordinary people are to be brought back to the fore. Government promises and procrastination until anger over the latest outrage subsides will not do.
‘Competition’ has come to mean little more than competition for maximum profit by whatever means. These include misusing the loyalty of longstanding – usually elderly – customers and by the use of complex charging schemes designed to confuse. In banking there is the common practice of slipping people into accounts with even more derisory rates of interest when bonds mature and salami slicing interest in ISAs so there’s hardly any difference to taxed accounts.
Creeping cartelisation is a feature of a number of other so-called competitive industries too – witness the power companies managing their latest round of price hikes. The regulators range from inadequate to useless. Orthodox consumer groups complaining into the ether and taking little action have also proved to be ineffective so it is good to see some direct action taking place.
Governments, not infrequently ideologically driven, not wanting to upset important political donors, do as little as they think they can get away with (and then complain about ‘apathy’ and low turnouts in elections). Unmitigated ‘competition’, meaning little more these days than an economic free-for-all, is well past its sell-by date.
But there is a way of making finance, fuel, power and other industries heed the public interest and behave with a measure of integrity. If each of these sectors had a publicly owned firm within it acting as an exemplar, treating people in a respectful, honest and straightforward fashion rather than merely as profit fodder this would introduce a form of competition that is worthwhile to society as a whole. It would offer security and fairness to ordinary people, presently suffering relentless abuse by commercial predators.
As I’ve often suggested, there would be no better place to start than with the recreation of Municipal Banks – in so far as the Government would still allow fully-fledged Municipal Banks to operate in a meaningful way. Once the success of this was demonstrated we could then move on to other areas, starting with the railways and the franchised companies’ love of cancellations, outrageous fare hikes, complex pricing schemes and overcrowded carriages.
The financial barrow boys who misled the country and dragged down the economy - and who have since had further shameful practices exposed -are not alone. This ‘industry’ is just one example of the unprincipled way in which private sector outfits now operate. Effective action – not simply cosmetic – needs to be taken if the interests of ordinary people are to be brought back to the fore. Government promises and procrastination until anger over the latest outrage subsides will not do.
‘Competition’ has come to mean little more than competition for maximum profit by whatever means. These include misusing the loyalty of longstanding – usually elderly – customers and by the use of complex charging schemes designed to confuse. In banking there is the common practice of slipping people into accounts with even more derisory rates of interest when bonds mature and salami slicing interest in ISAs so there’s hardly any difference to taxed accounts.
Creeping cartelisation is a feature of a number of other so-called competitive industries too – witness the power companies managing their latest round of price hikes. The regulators range from inadequate to useless. Orthodox consumer groups complaining into the ether and taking little action have also proved to be ineffective so it is good to see some direct action taking place.
Governments, not infrequently ideologically driven, not wanting to upset important political donors, do as little as they think they can get away with (and then complain about ‘apathy’ and low turnouts in elections). Unmitigated ‘competition’, meaning little more these days than an economic free-for-all, is well past its sell-by date.
But there is a way of making finance, fuel, power and other industries heed the public interest and behave with a measure of integrity. If each of these sectors had a publicly owned firm within it acting as an exemplar, treating people in a respectful, honest and straightforward fashion rather than merely as profit fodder this would introduce a form of competition that is worthwhile to society as a whole. It would offer security and fairness to ordinary people, presently suffering relentless abuse by commercial predators.
As I’ve often suggested, there would be no better place to start than with the recreation of Municipal Banks – in so far as the Government would still allow fully-fledged Municipal Banks to operate in a meaningful way. Once the success of this was demonstrated we could then move on to other areas, starting with the railways and the franchised companies’ love of cancellations, outrageous fare hikes, complex pricing schemes and overcrowded carriages.
Tuesday 18 December 2012
The Lunar Society
We are fortunate in Birmingham to have such a splendid organisation as the Lunar Society. Since its welcome re-incarnation in the 1980s, the Lunar Society has played a key role as an independent and productive forum for debate on scientific, engineering, medical, economic and related issues.
The Society brings together people from a wide range of professional, academic and industrial backgrounds to address important concerns of today and possibilities for tomorrow. The resultant understanding achieved is highly relevant to the present and future of our City, our Region and the wider world.
The global aspect is there because, true to its origins, the Lunar Society has made a major input and helped to raise the profile of matters of international importance. One example is the memorable focus on climate change and sustainable living which attracted an audience of several hundred to its main debate.
The 'Lunar mindset' matters every bit as much today as it did over two centuries ago when the Society was originally formed. Indeed in these austere and straightened times the work of the Society is more important than ever, seeking as it does to promote and connect innovative thinking in science, economics and culture and to catalyze action for the enhancement of the common good.
That we have such a visionary organisation with its foundations here in Birmingham is a great credit to the country's premier city outside of the capital. The Lunar Society website is well worth a visit covering upcoming events, speakers and discussions and membership arrangements.
The Society brings together people from a wide range of professional, academic and industrial backgrounds to address important concerns of today and possibilities for tomorrow. The resultant understanding achieved is highly relevant to the present and future of our City, our Region and the wider world.
The global aspect is there because, true to its origins, the Lunar Society has made a major input and helped to raise the profile of matters of international importance. One example is the memorable focus on climate change and sustainable living which attracted an audience of several hundred to its main debate.
The 'Lunar mindset' matters every bit as much today as it did over two centuries ago when the Society was originally formed. Indeed in these austere and straightened times the work of the Society is more important than ever, seeking as it does to promote and connect innovative thinking in science, economics and culture and to catalyze action for the enhancement of the common good.
That we have such a visionary organisation with its foundations here in Birmingham is a great credit to the country's premier city outside of the capital. The Lunar Society website is well worth a visit covering upcoming events, speakers and discussions and membership arrangements.
Thursday 13 December 2012
The Wonderful World of ‘Competition’
The recent outrageous further round of price hikes from power supply companies will have a severe impact on a wide range of people particularly, but by no means only, the millions already in desperate fuel poverty.
Average bills, already well into four-figure territory, will be pushed much higher still. The fuel companies benefit from a so-called ‘market’ where the main inter-company rivalry is about getting away with additional charges and inflated prices, making more profits, taking bigger bonuses and treating people as monetary cannon fodder. Another example, as if we needed it, of the wonderful world of competition.
Like banks and other notorious and parasitic sections of business today, they operate in effect, quite legally, as an informal cartel. They set their prices and margins in the same way and take it in turns to hike prices according to what they think they can get away with. Whether it’s gas, electricity or petrol, one thing is certain, unless there is official action these outfits will be getting a way with a lot more of your money and mine and their profits will not suffer one bit as a result.
Still, at least we needn’t lose sleep at night worrying about their oh-so-vital-to-the-economy executives’ remuneration or their shareholders profits - they at least will be comfortable in success or failure and can look forward to a tax cut next year. Even if pensioners can’t afford to keep a room warm, the board members will still have plenty of money to burn!
I would love to see a publicly owned exemplar company set up making fair, consistent and simple charges – some hopes! Failing this, in my opinion there should be frequent windfall taxes on fuel, power (and other) profiteering – the only questions should be about the extent and the use of the proceeds. It is clearly wrong that companies should make fat and inflated profits while people struggle to make ends meet, faced with rapidly rising costs for heating and other essentials such as food or even hanging on to their own homes.
Fuel and power supply are dominated by a small number of firms that are allowed in turn dominate you and me. These industries are classic ‘oligopoly’ structures, the shortcomings of which were once well understood. Industry ‘regulation’ in all quarters has been weak under successive governments and will remain so.
The exhortation to ordinary people to ‘shop around’ is worth little over time. It has been found out that a third of switchers make themselves worse off. And do they think that elderly and now vulnerable people who have built the country up should be spending their retirement time ‘switching’ between fuel companies (and banks) to reduce the extent to which they are exposed to highway robbery?
It is no defence for these organisations to retort that they are operating globally. Who has paid to make their fat global profits possible in the first place? We have! We’ve already paid ‘global’ companies with the British jobs they have exported and the higher prices they extract from us for the same products sold in other countries. This has fattened their profits and we’re entitled to a return on that too!
Since privatisation, foreign owned firms with even less concern for people in this country, sell North Sea gas to themselves during the summer for storing in Europe and reselling here at higher prices in the winter. Those companies who use (by whose consent?) the label ‘British’ should be made to act as if they were. Big business in general should not be a morality-free zone. They should think of those who have to eke out a small pension. They talk about their tough choices. How would they like to try the really tough choice between food and warmth?
Those who take big from society should also give back in comparable measure. Long gone are the days when those in near monopoly positions could be relied on to do this to some extent on their own account – or to be socially responsible and patriotic in the first place. So they need now to be taught how to be generous – or even pay their taxes. That would certainly be one way to create a warm glow all round!
Average bills, already well into four-figure territory, will be pushed much higher still. The fuel companies benefit from a so-called ‘market’ where the main inter-company rivalry is about getting away with additional charges and inflated prices, making more profits, taking bigger bonuses and treating people as monetary cannon fodder. Another example, as if we needed it, of the wonderful world of competition.
Like banks and other notorious and parasitic sections of business today, they operate in effect, quite legally, as an informal cartel. They set their prices and margins in the same way and take it in turns to hike prices according to what they think they can get away with. Whether it’s gas, electricity or petrol, one thing is certain, unless there is official action these outfits will be getting a way with a lot more of your money and mine and their profits will not suffer one bit as a result.
Still, at least we needn’t lose sleep at night worrying about their oh-so-vital-to-the-economy executives’ remuneration or their shareholders profits - they at least will be comfortable in success or failure and can look forward to a tax cut next year. Even if pensioners can’t afford to keep a room warm, the board members will still have plenty of money to burn!
I would love to see a publicly owned exemplar company set up making fair, consistent and simple charges – some hopes! Failing this, in my opinion there should be frequent windfall taxes on fuel, power (and other) profiteering – the only questions should be about the extent and the use of the proceeds. It is clearly wrong that companies should make fat and inflated profits while people struggle to make ends meet, faced with rapidly rising costs for heating and other essentials such as food or even hanging on to their own homes.
Fuel and power supply are dominated by a small number of firms that are allowed in turn dominate you and me. These industries are classic ‘oligopoly’ structures, the shortcomings of which were once well understood. Industry ‘regulation’ in all quarters has been weak under successive governments and will remain so.
The exhortation to ordinary people to ‘shop around’ is worth little over time. It has been found out that a third of switchers make themselves worse off. And do they think that elderly and now vulnerable people who have built the country up should be spending their retirement time ‘switching’ between fuel companies (and banks) to reduce the extent to which they are exposed to highway robbery?
It is no defence for these organisations to retort that they are operating globally. Who has paid to make their fat global profits possible in the first place? We have! We’ve already paid ‘global’ companies with the British jobs they have exported and the higher prices they extract from us for the same products sold in other countries. This has fattened their profits and we’re entitled to a return on that too!
Since privatisation, foreign owned firms with even less concern for people in this country, sell North Sea gas to themselves during the summer for storing in Europe and reselling here at higher prices in the winter. Those companies who use (by whose consent?) the label ‘British’ should be made to act as if they were. Big business in general should not be a morality-free zone. They should think of those who have to eke out a small pension. They talk about their tough choices. How would they like to try the really tough choice between food and warmth?
Those who take big from society should also give back in comparable measure. Long gone are the days when those in near monopoly positions could be relied on to do this to some extent on their own account – or to be socially responsible and patriotic in the first place. So they need now to be taught how to be generous – or even pay their taxes. That would certainly be one way to create a warm glow all round!
Saturday 8 December 2012
Saving the Economy
While it is ever more apparent that effective measures need to be taken to stimulate the flagging economy – and others throughout Europe - careful consideration must be given to the form that such measures take and the effects that the actions have on different groups of people. In my opinion we need to do more on behalf of the saving community.
There has been far too much reliance on keeping both short and long-term interest rates low. There should be a much greater emphasis on public works such as transport infrastructure, power generation and increasing the nation’s limited fuel storage capacity.
In the present circumstances interest rate cuts have only a very limited positive impact on the economy, mediated as they are through the banks, as we continue bumping along the bottom in the worst recession since the 1930s.
Moreover, reductions in interest rates adversely impact on savers immediately and are only partly passed on (in some cases loan charges were actually put up by banks) to borrowers. And the exorbitant rates that continue to be charged on credit cards, not to mention usurious payday loans, are a disgrace.
Savings are the bedrock on which long term investment should be built. Not only this, but savers, particularly older people in or near retirement, are having their incomes severely reduced by interest rates held for years at derisory levels on savings accounts even at banks that it might be thought had retained some shred of respectability.
Ways must be found to moderate this highly adverse impact on highly responsible people who have paid their taxes and who are trying to live within their means and provide for themselves. Whenever it is pointed out that state pensions are protected (so far) it is rarely mentioned that pensioners who have savings have lost hundreds or thousands of pounds of income by the slashing of interest rates.
Furthermore, the economic effect of interest rate cuts can even be the opposite of that intended. The substantial income reductions for savers mean that they have less money available to spend. Twenty years ago in Japan the experience was that as interest rates were progressively pared back people reduced consumption and saved harder to make up the lost income. Annuities for those coming up to retirement have also fallen and financial institutions already cream off huge chunks of people’s private pension savings.
As we see all to frequently, it is no use relying on the banks to be reasonable about interest rates to savers. There needs to be action by the Government. This it could take through National Savings and Investments (which used to be called the National Savings Bank). We certainly need a bank that is operated in the people’s interest and which provides secure and reasonable returns to savers. If the Government won’t provide such a bank then local authorities should be re-empowered to step in to act in the public interest.
These practical measures I admit are vain hopes in the atmosphere of austerity that the Government and its friends in the right wing press has persuaded people is unavoidable. This is not so and if a principled stand was taken against this negativity there would be more cause for optimism than there is now.
There has been far too much reliance on keeping both short and long-term interest rates low. There should be a much greater emphasis on public works such as transport infrastructure, power generation and increasing the nation’s limited fuel storage capacity.
In the present circumstances interest rate cuts have only a very limited positive impact on the economy, mediated as they are through the banks, as we continue bumping along the bottom in the worst recession since the 1930s.
Moreover, reductions in interest rates adversely impact on savers immediately and are only partly passed on (in some cases loan charges were actually put up by banks) to borrowers. And the exorbitant rates that continue to be charged on credit cards, not to mention usurious payday loans, are a disgrace.
Savings are the bedrock on which long term investment should be built. Not only this, but savers, particularly older people in or near retirement, are having their incomes severely reduced by interest rates held for years at derisory levels on savings accounts even at banks that it might be thought had retained some shred of respectability.
Ways must be found to moderate this highly adverse impact on highly responsible people who have paid their taxes and who are trying to live within their means and provide for themselves. Whenever it is pointed out that state pensions are protected (so far) it is rarely mentioned that pensioners who have savings have lost hundreds or thousands of pounds of income by the slashing of interest rates.
Furthermore, the economic effect of interest rate cuts can even be the opposite of that intended. The substantial income reductions for savers mean that they have less money available to spend. Twenty years ago in Japan the experience was that as interest rates were progressively pared back people reduced consumption and saved harder to make up the lost income. Annuities for those coming up to retirement have also fallen and financial institutions already cream off huge chunks of people’s private pension savings.
As we see all to frequently, it is no use relying on the banks to be reasonable about interest rates to savers. There needs to be action by the Government. This it could take through National Savings and Investments (which used to be called the National Savings Bank). We certainly need a bank that is operated in the people’s interest and which provides secure and reasonable returns to savers. If the Government won’t provide such a bank then local authorities should be re-empowered to step in to act in the public interest.
These practical measures I admit are vain hopes in the atmosphere of austerity that the Government and its friends in the right wing press has persuaded people is unavoidable. This is not so and if a principled stand was taken against this negativity there would be more cause for optimism than there is now.
Thursday 6 December 2012
Star Wars
I’ve now started a long overdue personal boycott of Starbucks. As if this outfit’s long history of UK tax dodging wasn't bad enough, their wretched managers are now trying to claw back any future tax bill from their low paid staff by, amongst other things, stopping paying them in their (half hour) lunch break. This was the last straw for me and no amount of sugar in the coffee could sweeten this!
It’s yet another example of less well off people being made to pay the price for greed, bungling and rank disloyalty by overpaid executives. And of course it is the approach taken by this equally wretched government with the scrapping of Remploy at the same time as promising a nice tax reduction for the rich one of the most appalling examples of its true values.
Tax dodging companies - of whom there are many - and individuals should have been made to cough up long ago. They are freeloaders on society and if they want to go elsewhere we should see if we could struggle along without them.
Payment of taxes should not be voluntary and it remains to be seen how much Starbucks and others (such as Amazon and Google) actually pay in the future. The years of austerity brought on by avaricious banks and incompetent and misguided government would be easier to endure if we really were ‘all in it together’. Perhaps we could then meet up for a coffee fairly traded at home and abroad!
It’s yet another example of less well off people being made to pay the price for greed, bungling and rank disloyalty by overpaid executives. And of course it is the approach taken by this equally wretched government with the scrapping of Remploy at the same time as promising a nice tax reduction for the rich one of the most appalling examples of its true values.
Tax dodging companies - of whom there are many - and individuals should have been made to cough up long ago. They are freeloaders on society and if they want to go elsewhere we should see if we could struggle along without them.
Payment of taxes should not be voluntary and it remains to be seen how much Starbucks and others (such as Amazon and Google) actually pay in the future. The years of austerity brought on by avaricious banks and incompetent and misguided government would be easier to endure if we really were ‘all in it together’. Perhaps we could then meet up for a coffee fairly traded at home and abroad!
Subscribe to:
Posts (Atom)