Skip to main content

What Britain could start to do next

The problem with British government policy is that the civil servants are still working to the New Labour Playbook. "Eye-catching" announcements are made, usually with recycled, rather than new money which are supposed to give the impression that the government is purposefully shaping the agenda rather than simply waiting on events. Almost always these announcements involve spending, and whenever any idea of restructuring is mentioned, the necessary retrenchment is typically ignored.

Except, of course, that Britain needs retrenchment.

The reason why so many voters now believe the welfare system needs reducing, is because they have seen that it doesn't work. Often it has created a skivers charter, and placed innumerable bureaucratic obstacles in the way of those who actually wish to get work. Huge amounts of money have been wasted.

The core of British bureaucracy, ironically enough, lies not with the spending departments but with the Treasury. As I have noted before, the over 11,000 pages of the British tax code is five times larger than the German code. It is also a make work project for tax inspectors and accountants- with billions now at stake in vested interests. Yet the cost of tax collection is nearly as bloated as the tax code itself. Over £18 billion is spent on simply collecting tax. That represents about 8% of revenue, and does not account for the roughly the same amount spent on benefits and tax credits. Essentially 15% of our taxes are squandered on the spectacularly inefficient way we collect and distribute them. This cost does not count the cost of compliance for individual tax payers and companies and the army of accountants that they need to hire.

Meanwhile the regulatory burden on small businesses is decimating our spirit of entrepreneurship. People who can not find work find it even more difficult to set up on their own.

This has got to stop.

If the coalition does one thing, it must break out of the New Labour mindset so beloved of civil servants. The tax code must be radically reformed: tax simplification would be a start, but if the UK is genuinely going to restore its competitiveness, it should seek a tax code that can be understood and complied with by simple individuals. Supply side reform is now a critical part of stimulating recovery.

In my view, the British people are increasingly cynical of government programmes that do more for the civil servants administering them than for the supposed targets of those programmes.

A radical tax overhaul will show people that they can take back control in their lives.

That is the message that Liberal Democrats should be putting across in coalition and in public.


Anonymous said…
Cicero, while I agree with a lot of this, I was startled by the following:

"Over £18 billion is spent on simply collecting tax. That represents about 8% of revenue"

That implies total tax revenue is around £225 billion. Surely it is closer to £550 billion?

While I agree entirely that £18 billion is far too large a sum, and needs reducing, it doesn't strike me as very likely that it would produce the percentage scale economies you imply. Although in net terms it might do so by increasing tax take due to the reduction in tax evasion and increased economic activity resulting from reduced bureaucracy.

Popular posts from this blog

Trump and Brexit are the Pearl Harbor and the Fall of Singapore in Russia's Hybrid war against the West.

In December 1941, Imperial Japan launched a surprise attack on the United States at Pearl Harbor. After the subsequent declaration of war, within three days, the Japanese had sunk the British warships, HMS Prince of Wales and HMS Repulse, and the rapid Japanese attack led to the surrender of Hong Kong on Christmas Day 1941 and the fall of Singapore only two months after Pearl Harbor. These were the opening blows in the long war of the Pacific that cost over 30,000,000 lives and was only ended with the detonations above Hiroshima and Nagasaki.

"History doesn't often repeat itself, but it rhymes" is an aphorism attributed to Mark Twain, and in a way it seems quite appropriate when we survey the current scene. 

In 1941, Imperial Japan, knowing its own weakness, chose a non-conventional form of war, the surprise attack. Since the end of his first Presidential term, Vladimir Putin, knowing Russia's weakness, has also chosen non-conventional ways to promote his domestic powe…

Cicero ReDux

By Special Request of Baroness Scott and Mark Valladares... Cicero's Songs returns: bigger, longer and uncut.
October 1st marked the half way point of the Estonian Presidency of the European Union.  Perhaps for many people such an anniversary is of passing interest at best.  Yet the conduct of the Estonian Presidency is reinforcing just how forward looking and innovative the most northerly of the Baltic States has become.
Estonia is a country that wants to live in the future, and with its openness and innovation, that future seems a lot closer than almost anywhere else in Europe
It is not that Estonia does not “do” the past: the picturesque cobbled streets of old Tallinn have tourist crowds a-plenty enjoying the mediaeval architecture in an Indian summer of sunshine and blue skies.  The real point is that Estonia refuses to be a prisoner of its past. Lennart Meri, Estonia’s President in the 1990s- who spent years of his childhood in Siberia- once told me that the country had to conc…

The American National nightmare becomes a global nightmare

It is a basic contention of this blog that Donald J Trump is not fit for office.

A crooked real estate developer with a dubious past and highly questionable finances. he has systematically lied his way into financial or other advantage. His personal qualities include vulgarity, sexual assault allegations and fraudulent statements on almost every subject. 

He lost the popular vote by nearly three million votes.

He has, of course, been under criminal investigation practically since before he took the oath of office. The indictment of some of closest advisers is just the beginning. His track record suggests that in due course there is no action he will not take, whether illegal or unconstitutional in order to derail his own inevitable impeachment and the indictments that must surely follow the successful investigation of Robert Mueller into his connections with Russia.

However, all of that is a matter for the American people. 

It is also a matter for the American people that Trump is cheating…