Universal Credit – doff your cap

Welfare bill £192bn

Savings from universal credit cap, about £270m to £330m depending on which year you look at.  Let’s say £300m a year.  Sounds a lot doesn’t it?  That’s until you put the zeros in and then see what they mean.

£192,000,000,000

£300,000,000

See the difference – that’s a £3 saving on every £1,920 spent.  That’s right three pounds in every one hundred and ninety two thousand.  Or put one more way less than 0.2%.

Makes you wonder why the Government is so keen to push ahead with it doesn’t it?

Of course, it’s sold on a fairness argument.  Nobody on benefits should be able to earn more than the average wage of £26,000.  Sounds reasonable.

Only …..  it isn’t just about earnings.  It takes your housing costs into account too.  £26,000 is about £500 a week and this has to cover your housing costs and your general living expenses.  In London you would be lucky to get a one bed flat for that – and you wouldn’t be getting change.  A 3 bed house would set you back more like £800 or £900 in Central London.  In outer areas, somewhere like Brent, you might get it for £450 to £500 – but that’s all your benefit gone.  Nothing to live on.

Oh but they say.  Those on benefits shouldn’t be able to live in areas that others can only dream of (I dream of Brent – hmmm).  Well that’s alright if you think it’s OK for London to be for the rich only; a ‘too good for you’ area; where all the cleaners and shopworkers ,and more than likely the nurses and teachers too, commute in each day because they can’t afford to live there.

Already the difference between London prices and anywhere else is growing rapidly and this, along with many other policies will make that divide worse.

The benefit cap doesn’t apply to working households.  But if you are in work and are then unfortunate enough to lose your job, and you live in London, you will have to move.  Once the impact of the changes work through, the migration happens (as it already is) and the prices divide more, the chances of ever getting back again become increasingly small.

This policy has nothing to do with fairness and saving money.  It is about moving poor people out of London

My ideas for Occupy

A quick glance at the Guardian website yesterday shows that the Occupy protesters at St Pauls are calling out for suggestions.   I haven’t had a chance to look at anything being suggested yet, but am really pleased to see the debate getting underway.  I will be having a read through shortly.  Here are some things I would like to throw in:

1. Acknowledgement that it is a global issue and seeks to find solutions that can be applied across national boundaries.

2. An understanding that the economy and the political set up are intertwined and action on governance is crucial to rectifying problems with the economy

3. Inequality both within this country (and others) and between countries must be tackled in achieving a fairer system

4. A new system of governance needs to be devised that will work from the most local level all the way up to world governance.  The principle of subsidiarity is a good start.

5. Balance is an important guiding concept.  i.e. There is a place for both collaboration and competition.  We have both an individualistic and a social side to our characters.  Our systems need to take account of both. i.e. we should work both in our own interests and in societies interests – I would suggest on a 50/50 basis.  We should be encouraged both to make profit and to give charitably – again a 50/50 basis sounds reasonable.  How about a four way grid

Quarter a: Personal/profitable.  A quarter of the yield from your work is yours to do with as you will

Quarter b: Social/profitable. A quarter of the yield from you work you invest in for a return

Quarter c Personal/charitable. This quarter again you decide where it goes but it is given away for the greater good

Quarter d. Social/charitable.  This quarter you give away and ‘the government’ spend it, including on the bits that people aren’t likely to have covered in c such as looking after criminals or maintaining sewers.

6.  Tackle tax havens.  I suggest we get together as many ‘reasonable nations’ as we can, set in place some basic standards on things like corporation tax levels that we will not go below and we then refuse to trade with anyone who doesn’t play.

6a.  The same trading block can be used to demand standards in relaton to things like minimum wages and health and safety – a far better way of getting competitive with China than trying to get wages down to their level!  Look up Simpol for joining up policies across nations.

7. Further develop projects that look at giving ethical ratings to companies.  Include within that their tax affairs, sustainable sourcing, how flat their pay structures are, whether they are employee owned and more.  Build an app to access the data quickly and easily.

8. Find some small banks that it would be feasible for crowds to buy shares in.  Take them over and make them social enterprises.  Encourage others to transfer their accounts to them.

8b. Break up large banks

8c. Separate the investment banks from others – not just within the same bank – separate banks.

9. Think about what should be achieved on income equality.  How much space should there be between top and bottom.  I’m minded towards nobody earning more than double or less than half the average (median).  That way competition is limited to 3 x as much from bottom to top.  I realise this may seem a bit much for people to swallow straight off and it may be appropriate to have a somewhat wider spread, but I wouldn’t want to see the aspiration be for anything wider than ten.  I would advocate moving towards a more equitable income spread over a number of years so that the jolt for individuals is lessened.

The methods for achieving this can be worked out as we go along and needn’t be set in stone.  If they have perverse consequences, change them.  It’s the general intent and direction of travel and understanding of what you are trying to achieve that is important.  Ignore the prats who want to do detail first.

10.  A new economic system must not rely on perpertual growth as the system does currently.  It may be possible to create considerably more growth in industries that do not rely on consumption i.e. personal services such as health and care, but we should not have to need growth.  Steady state should be OK in a sensible system.  At the moment the need for growth distorts horribly.  What sort of daft system requires consumers to consume more and more and spend more and more when they are already drowning in debt and the world is running out of resources.  We have to get a grip.

11.  Don’t forget to link up to other issues.  In particular the resource thing including oil.  Climate change – a plan that doesn’t involve human extinction would be good.  Peace would also be nice.

12.  Use the IT to spread ideas around the world.  Promote direct democracy, greater equality and removal of powerful elites.

13. Full employment shouldn’t mean working all the time.  I see no reason why everyone shouldn’t work part time and then spend lots of time, studying for free, raising families being neighbourly, engaging in cultural actvities, working on their own homes and gardens etc.

14.  Recognise unpaid work properly

15.  Get rid of the ludicrous idea of people work into their 70s (by compulsion, fine if they want to) while we have a million tweny somethings withou work.  This is bonkers.

OK there’s my dreams for today.  Sorry no particular order.  Let’s see what others are thinking.

More questions than answers in a world gone nuts

Lets’s try a quick sum up of what’s going on big picture wise at the moment.  Debt in the Eurozone has been dominating the headlines with the Greek situation coming to a head, Italy hot on its heels and now the rumour mill starting on France.

The UK, having not joined the Euro, is playing high and mighty and telling the rest of Europe to get their act together, like none of it had anything to do with us.  (I guess you have to admire the gall if nothing else.  Of course London financiers had nothing to do with deregulation in the financial sector and encouraging unsustainable borrowing that has inflated the bubble did they.  It would be funny if not so tragic.  The tragedy being that huge swathes of the general public having been living on a diet of ***ing breakfast TV for news still believe the nice Mr Cameron).  Anyway back to the story.  Here’s a little cartoon to break it up.  This, I think encapsulates, in a nut shell. the root problem.

The Occupy protests are often displayed as being anti-capitalist, and there are anti-capitalists mixed in amongst protestors, but I don’t think most of them are.  In the last century we saw the rise of communism.  At its heart was a notion of fairness, but this was quickly distorted by a different type of powerful elite rising, and innovation being stifled by lack of competition and an overly controlling state, with plenty of corruption to boot.  The experiment failed and we put our faith whole heartedly in the capitalist model.  It is now clear to anyway prepared to peep out of their blinkers, that capitalism is in chaos.  Although this is now beginning to be talked about more openly, as we inch closer and closer to real crisis (and potential collapse); there have been those who have seen this coming for some time but up until now have found it impossible to get heard.  The reason for this is pretty obvious to me.  Our leaders do not have a clue what to do about it (added to which many of them have a vested interest in the extreme inequalities that lie at the root of the problem).  Because they can’t find an answer in the existing economic model, they are in denial, so anyone challenging the prevaling, business as usual view of the world, is rapidly sidelined.  The upshot of this being that their has been bugger all debate and development of alternative options.

So as the Eurozone situation is developing, we have the leaders trying this way and that to get more bailout money together to keep the all important markets happy.  Worryingly this now involves so called technocrats being put in powerful politcal positions in Greece and in potentially Italy too.  What do we mean by technocrat?  Just how close are they to Goldman Sachs?  (I’m sure I heard somewhere that ‘Super Mario’ who now gets to play in charge in Italy, cut his teeth at Goldman Sachs) Personally, I find this a truly frightening development.  Back to tragedy, and this one very Greek.  The birthplace of democracy has to cancel plans for a referendum and accept a government lead by technocrats with their strings operated by others outside the country.

Why has this happened.  Well the story goes that the greeks have borrowed more than they can afford to pay back and we are told that the books were cooked.  Now we hear that they should never have been allowed to join the euro.  That the systems of tax collection were not well enough established.  There was too much corruption etc, etc.  Who did they borrow the money from?   Various places, but the mostly the Germans.  Note this is not the German government, but German Banks – Deutsche Bank.  I read somewhere that Deutsche Bank is owed about the same amount by LA casinos, but nobody is bothering to chase too hard on that one, because casinos don’t have a population that they can impose austerity measures on.

How well will all of this work?  From where I sit we have a box of sticking plasters that we are getting through more and more rapidly.  The patients are just about alive, but the wounds aren’t healing and there are more and more patients stacking up behind with bigger and bigger wounds and we still only have the same box of sticking plasters.

This is not going to work.  The problem is with the system itself and we can’t fix it without recognising that.   In the UK our Government constantly tells us that reducing the deficit is the number one priority.  Leaving aside questions about whether this should be the priority and whether it is happening, what does the rest of the economic plan if successful look like?  The important bit of this to understand is that reducing the deficit does not mean reducing the debt.  In the Cameron/Osborne masterplan, the government debt still rises astronomically.  See this post.  At this point the forecast was based on Government borrowing increasing from £772bn in 2009/10 to £1,320bn in 2015/16.  Now how do you think that extra borrowing will be financed?  Well in wonderful world of Dave and George we’re going to have a whole load of miraculous growth and all that lovely consumption will be helped along by us ordinary people doubling our current personal debt.  I’m trying to work out how to make my bold button get bolder.  Let’s try this

DOUBLING PERSONAL DEBT (I think I might have pay for some more features on this blog like big letters)

Anyway what we have we got from our great leaders is – the way out of the problem is to make you borrow more.

So what would I do? Well classically I wouldn’t start from where I am now.  That may not sound very helpful, but actually I think it is.  If we try to think about how to resolve current difficulties, its takes only minutes to caught up in the minutiae of rules and regulations and how things opetate currently and all the barriers in place and how impossible it all is.  Looking at the current situation to understand what’s wrong with it is fine, but then we need to mentally step out of it.  Think it through from scratch.  Play god.  If you were organising the world, how would you do it? (Note – the blueprint is allowed to chance, let’s just start making one).  When ideas about how things could work better from first principles are in place – then it will be much easier to see some steps that need to be taken to get there.

Incidentally for those who think I’m having delusions of grandeur here – I’m not, I just don’t see anywhere near enough people doing this and I would like to see everyone doing it.

What are we trying to achieve?  Nice things that’s what.  How about this for good old vision statement ‘The human race leading fulfilling lives peacefully and respectfully in a beautiful, abundant and sustainable world’.  Well if we’re going to this we might as well aim high.

More to follow.

Greenest government ever? Hello!!!!

What is that green around the gills?  Green as in ogre?  Greenwash?  Green as in slime ball?  Scab?  Gangrene?

Stupid or evil?  I can’t decide.

Climate – too late?  Almost

The International Energy Agency has warned the it is our last chance to avoid irreversible climate change.  Emissions released now will continue to warm the atmosphere for decades.  450 parts per million is regarded by scientists as the
safety limit.  We are now at around 390ppm. By 2015 at least 90% of the available carbon budget will be used up.  By 2017 there will be no room for manouevre at all.

Russia and Japan have spoken in recent weeks of reaching agreement by 2018 and 2020.  The UK are supporting this stance.

Remember the IEA is regarded as being pretty conservative in outlook so the real situation is probably worse.

http://www.guardian.co.uk/environment/2011/nov/09/fossil-fuel-infrastructure-climate-change

A historic decade

This decade will be historically important. It will mark a turning point. The days when inequality didn’t matter, because the pile of crumbs could keep being added to are over. As resources become more scarce, how they are divided up becomes increasingly important.

Throughout much of my life, politicians have bemoaned lack of engagement by the community at large. There are, in my opinion two distinct and quite different reasons for this lack of public involvement in politics. The first is that everything was fine. Apathy can be a pretty good sign that there isn’t a fat lot going wrong. It’s when people are really fed up that they start to become vocal. The other reason is rather more negative. People don’t engage because the system doesn’t allow for that engagement to be meaningful. The terms of the engagement, the methods, the agenda, the options are all set.

Communciation has been linked with giant leaps forward before. The printed word was responsible for spreading ideas far more widely than previously possible. The internet has developed so that it is now widely available. It can be used instantly, and in different ways, including via the phones people carry in their pockets. Social media including Facebook and Twitter increase the possibilities for rapid interaction. All of this means that it is far more difficult to hide the truth. When Liam Fox tried to hold out, it wasn’t just the Labour Party and the press who were going to seal his fate, but a myriad of others who read, and were outraged, and would add bits to the jigsaw until enough of truth was out there that the stench could not be ignored.

When the mainstream media tries to present the occupy movement as a small bunch of anti-capitalist lefties on the verge of turning nasty at any moment, we can turn easily to other sources that tell a different story – one of mass protest, peaceful protest, widespread and justifiable anger with corporate greed, a world distorted by the profit motive, inequality that leaves many in dire circumstances while the rich party. As alternative media becomes more widely available and respectable alternative outlets grow (such as the Real News Network) there are clear consequences for the mainstream. Firstly they cannot ignore issues once their exposure reaches a certain level. So reports get through even if they are played down, at least initially. Secondly, those who spout rubbish get exposed. This is the beginning and much more change will come. Exciting new developments will push forward the boundaries of how direct democracy can work, models to enable collaborative decisions and collaborative investments as well as enabling much more collaborative work. There is something else that was very important about how the internet came to us. It was free. Thank you Tim Berners-Lee. Imagine how much better the world could be if Pfizer took the same approach.

Back to main point of this post. We have seen an enormous concentration of wealth and there are enormous challenges ahead. Many resources are becoming scarce. We will be moving from a situation where we get ticked off about how much the gas and electricity bills have gone up, to one where there are serious issues about being able to obtain and afford the power to keep warm and to cook. The supply of food around the world will become more and more difficult to sustain and that will translate into big changes in the cost and availability of food here too. When the challenges get this fundamental, then how resources are distributed has very different connotations to the ones they have had over the last century. Of course there may be wonderful new inventions that up our game to a point where once again concerns about inequality can rumble away at the bottom of the agenda, but right now the signs are not looking too great – and the prospects for finding those new inventions look much more likely to be successfully and sustainably introduced if they come through a model that has sustainability not profit as its key principle. Can capitalism do that?

If we roll back time just 150 years we find a social order in which most of us doffed our caps to a ruling elite. It is only since then, that ordinary people have been lifted out of real hardship – in having even the basics for a good life in this country. This has coincided with a period of abundant energy and, largely because of that energy, considerable and consistent economic growth. Even with these good times on their side, people had to fight hard, for decent wages, for votes, for public services, reasonable working hours, health and safety, and of course free healthcare.

Now we are surrounded by people boasting of working so hard that they never get home before ten at night, outcompeting each other to work harder, longer, faster for less. We complain about faceless bureaucrats doing non-jobs and health and safety gone mad. We get upset about people with no work, living off the state; or a woman whose children have left home having more rooms in her social rented property (her family home) than she needs. In the meantime, we allow corporations to stash their profits in tax havens; our politicians to allow their political and business interests to ‘blur’; and we continue to admire the cult of celebrity.

In this decade we will make a choice. We will either wake up, as the Occupy movement would like us to, or we will leave it too late, so the return to serfdom becomes unstoppable.

Occupy equal ground

The Occupy Wall Street protest, and other ‘Occupy ‘ protests that are springing up rapidly in other cities around the world, have at their core, a resentment about an elite having made conditions worse for the majority and a desire to see much less inequality.

So how unequal are we?  To consider this question for England, I’ve been looking at a report published by the Resolution Foundation Commission on Living Standards (RF), in July this year.  Missing Out: Why ordinary workers are experiencing growth without gain, Matthew Whittaker and Lee Savage.  This looks at inequality as it relates to wages, although I should add here that this isn’t the only, or necessarily even the most important type of inequality.  Pole position probably goes to wealth inequality, but that will have to wait for another post.

The short version – less of the value in the economy is going to those in the bottom half of wage hierarchy, while the amount going to profit has gone up.  Sectors of the economy where the proportion of the value made is more favourable to the bottom end workers have shrunk, whilst those where a lower proportion goes to low paid workers has increased.  Most of the change in the proportion of GVA accruing to bottom end workers is because of increasing inequality within the wages paid.  During the 90s inequality grew across the spectrum but in the last decade, while the rest of wages have become stagnant, the top earners, and especially the very top have continued to increase and become detached from the rest.  In the financial sector, increases in wages have been faster than increases in jobs.  Those in the retail sector have fared particularly badly, with wages having stagnated earlier and the share that retail wages make up of the overall wage bill having reduced, while the number of employees continued to increase.  All in all, what we knew all along.  We have become more and more divided and the bankers have taken the spoils.

The longer version

The RF report looks at Gross Value Added (GVA) – that’s GDP with taxes and subsidies taken out so it covers just value generated in the economy through production, such as an employee at work or a machine producing goods.

Their analysis shows what happened to every £100 of GVA in 1977 compared to 2010.  So how did it change?  The proportion that went to capital (business profits and self employment income) went up (£36 to £39); the proportion relating to social contributions (such as employers national insurance contributions) also went up (£9 to £11); the proportion going to the top half of wages stayed the same at £39; and those in the bottom half of the wage spectrum lost out – down from £16 to £12.  The top 1% of earners increased their share of GVA from 2% to  3.1% and the bottom 10% saw their share fall from 1.2% to 0.8%. This data doesn’t include annual incentives which makes a big difference and I will come back to that.

What has changed to cause these differences?

The industrial structure of the UK economy has shifted.  Notably the importance of finance has grown substantially 16.3% in 1977 to 33.6% in 2010 while the share of GVA relating to industry has fallen 33.1% in 1977 to 15.7% in 2010.

A relativly large proportion of value generated flows to labour in the industrial sector whereas in the finance sector more is retained as profits.  The dramatic shift in the industrial structure of the UK has consequently had a strong negative impact on the labour share of GVA.

Change in wage distribution is by far the most important factor in the decline seen at the bottom end of the labour market, accounting for about 70% of the change.  During the 1980s and early 90s wage inequality grew across the range fo wages, characterised as a ‘fanning out’.  The top moved further away from the middle, which in turn moved further away from the bottom.

Since the mid 90s the ratio of middle-to-bottom earnings has levellled out, but the ratio of top-to-middle earnings continued to grow.  The ‘fanning out’ had stopped and had been replaed by a ‘detachment’ of the top from the rest.

The report quotes other work by Bell and Van Reenan, ‘Bankers’ pay and extreme inequality in the UK’, London School of Economics, 2010 – I wondered when the *ankers where going to show up.  This report shows that over the last ten years the increased share of wages going to the very highest earners in all sectors was mainly due to incentive payments – and more than 60% of that was bonus payments in the finance sector.

The RF report looked at wage distribution in the eight largest employment sectors in the UK (finance, business activities, retail, health etc, manufacturing, construction, education, and public administration).  The findings show inequality more or less static between 1999 and 2008 in all sectors but two – finance and construction.  At the start of the period wage inequality in construction was less than in other sectors and although this increased, it is still less than within other sectors.

Not surprisingly, the story for finance is different.  In contrast to other industries inequlities continued to rise in this sector.  In particular they found a sharp rise in inequlity right at the top of the wage spectrum.

The general picture on wage trends is year-on-year increases in the real value of wages up until around 2003, followed by stagnation in the period 2003 to 2008, despite strong economic growth.

In the retail sector stagnation came earlier and covers the entire period from 1999 to 2008.  The retail industry is the second largest in the UK in terms of employment share and provides more jobs for low to middle income households than any other.

In finance average wages were far higher than any other industry and pay continued to rise through the second half of the decade, so the sector has contued to move further away from others.  Within the finance sector annual pay rose much more steeply than hourly – again pointing at bonuses.

Between 1999 and 2008 manufacturing shifted dramatically from being the largest employer providing 19% of employment to just 12%.  Finance significantly increased its share of GVA but not employment – that fell by 0.5%.  The wages were increasing rather than the number of employees.  The business activities sector share grew by 3.6% for wages and 3.2% for employment.

Retail while taking a slightly higher share of employees, moved in the opposite direction for wages – it’s share of the wage bill went down by 0.6%

Conference season – what a shambles

The round of party political conferences is drawing to a close.  What are the key messages that came across to me?  The LibDems are depressed.  They are fed up with the position they find themselves in, but can no longer see a way out and so are resigned to seeing it through.  At least now they’ve decided it’s a good idea to point out their differences to the Tories so they get a bit of it off their chest but they are having to grit their teeth and be nice to Cleggy.  None of this is going to stop them being buried though.  The voters are angry.  Really angry.

Ed and Ed.  I’m doing my best to be patient with Milliband.  He struck a chord with the good and bad businesses stuff even if it didn’t translate easily into workable policy; and anyone that includes Tim Jackson’s, Prosperity without Growth in his reading matter has clearly understood the need for some new thinking.  The media were never going to be on his side and pointing out some of the evils in Murdoch’s empire will have sealed his fate as far as the papers are concerned.  Ed needs to learn how to present himself better and would do well to make the most of alternative media in addition to the mainstream stuff, to get his points across and appeal to an often more enlightened audience.  He annoyed me with the housing stuff about hard working, deserving people getting priority.  We’re back to deserving and undeserving poor here.  Perhaps we should block their access to health care and education as well.  If the parents don’t meet the mark, should their children suffer?  What were their parents like?  There are all sorts of reasons why people deviate from the mainstream, you are unlikely to bring them back with this type of policy.  If we do go down this route of picking out who is deserving, can someone explain to me what we are supposed to do with the others?  Workhouse maybe?  For goodness sake get rid of that Flint woman as your shadow for housing.  She was useless at it when Labour were in power and she still is.

As for the other Ed well at least he has some Balls.  Better than the last appointment but the jury’s still out for me.

And finally the Conservatives. You couldn’t make it up.  A Prime Minister who clearly hasn’t the faintest idea of even the basics about how the economy works.  He starts the day with a plan to tell us to pay off our credit card debts and has to have a major rewrite when it’s pointed out to him that it would be a one way ticket to major recession.  We’re going there anyway Dave, we don’t need any more help.  Now they tell us it was a description of what is happening rather than a suggestion that we do it.  Anybody believe that?  Oh dear my sides are hurting.

You would have thought that George might have warned him, wouldn’t you.  Maybe this chancellor isn’t prepared to wait so long.  How’s your back Dave?

Note to Theresa May.  The Daily Mail is not a reliable source.  To avoid future embarrassment try facts rather than prejudice.

And finally for more heart warming politics take a look at Occupy Wall Street, spreading rapidly to a town near you.

Cornwall Council Cabinet – next week

St Austell Council offices

Cabinet next Wednesday will discuss what to do about the council offices in Penwinnick Road, St Austell.  The report tells us that when the council was first set up, they did some work to identify which offices they wanted to protect and keep, one of which was St Austell.  Then along came a supermarket and made them an offer, so they decided to flog it anyway.  The report seems to be suggesting that they might like to house the 350 staff who currently work there at the Sedgemoor offices, which I think are at the back of Ozzell Bowl, but that bit wasn’t really clear.

Anyway they have invited bids to see what they get for it, but we’re not allowed to know what they say.  And the website gives us a link to the explanation for why we’re not allowed to know what they say, which tells us nothing in English.

New Homes Bonus

This report details how the council wants to deal with the almost £2m new homes bonus that it has for this year – a figure that will increase markedly in future years.  It says, for this year, and notably no commitment for future years, that it wants to use the funding to support housing priorities – which I commend.

It indentifies – three types of support – Provision of new homes to meet local need, bringing empties back into use, supporting enabling infrastructure to bring forward and support new housing sites.

I have no great problem with these priorities in principle (although there are other aspects I would like to see given consideration as well), but I would like to know more of the detail of how the money will be spent – how much on each of these elements? – and where? – and specifically how much on the infrastructure bit? – on this part a commitment that it will only go to support infrastructure on sites with a considerable affordable housing element might be good.

Perhaps they could use some of the money to assist those currently in poor standard housing, how about supporting some of the voluntary sector organisations who house vulnerable people to improve their housing conditions?  Housing isn’t all about building new you know.

Part of the purpose of new homes bonus is to reward those communities who accept new housing.  It would be good to see this made explicit by returning at least a proportion of the new homes bonus to the areas in which it was raised and to commit to consulting the relevant communities on how it is spent.

I do not agree with delegated authority asked for in the report without a much stronger framework around how this funding (which will reach levels over £10m in 5/6 years time) is distributed and monitoring arrangements that report back regularly put in place.

Outsourcing public services saves money doesn’t it?

You know how the argument goes.  The private sector has to compete and that drives innovation and efficiency.  I could take issue with this, but let’s not bother with that bit for now and go for the real travesty.

Ethical consumer network have just completed some research looking at who wins the £200 billion a year of public sector contracts.  It has put 20 of the largest contract winners under the ethical spotlight and guess what, they found that this mushrooming business gives contracts to some of the most unethical global companies.

The companies score particularly badly in relation to politics (virtually all of them were playing this game) – you know the sort of the thing, manoevering to get access to Whitehall power brokers, making party donations, employing former ministers.

13 had subsidiary companies in countries widely considered as tax havens.  Included amongst these are BUPA, Capita and Sodexo.  KPMG has a presence in 47 out 60 recognised tax havens.

13 of the 20 also score very badly on human rights, including Serco, BUPA, KPMG, McKinsey

The list of companies they looked at and found wanting to various degrees is:

Circle

A4e

BPP

BUPA

United health

KPMG

McKinsey

Vodafone

IBM

Atos

HP

Balfour Beatty

Alliance Medical

Ferrovial

Veolia

G4S

ISS

Sodexo

Serco

Capita

Wonder how many of these have contracts in Cornwall?

Another excellent Guardian article here by Pankash Mistra, on how the poor are being stuffed around the world, including here in the UK, and the rising anger against it.

My comment on the article is repeated below.

A really excellent article, but the real question is what next?  I think we’ve gone too far to be able to simply roll back globalisation and retreat within our boundaries.  For the UK in particular, we are now a very long way from self sufficient and seizing up global markets will only make things worse for us.  For the world as a whole, we are now so interconnected that a rapid retreat from globalisation would mean catastrophic collapse.

I see the problem not a globalisation itself, but the partial and poorly constructed nature of it.  We have corporations acting globally while governments act for nations.  This means in simple terms corporations play one off against the other and we have the ensuing race to the bottom.  It is right that we will all end up at the same level for wages, but why not make that our level rather than the Chinese or Indian one.

To solve this we need more globalisation, but of the type that starts to set worldwide minimum standards.  This includes minimum wages, health and safety, the amount of tax corporations should pay.  We need to start to put in place an effective world wide governance structure – note this isn’t a straight move to a global government, but a sensible process for moving government towards far greater areas of agreement to protect the citizens of the world.  If large numbers of nations begin to act effectively together then peaceful pressures can be applied to encourage others to join rather than be frozen out.

Trying to pull some of the threads together

On over population, it is an issue, but it is poor countries that have the largest populations, and those with smaller populations that use the most resources.  Too many peeps is way too simplistic an understanding.