Surely we can all (most) think rationally enough to discuss this stuff in an adult manner?!

What a strange and utterly bizarre concept…

Can someone explain to me how we are going to pay for the public sector workers who's jobs are cut, will stop paying taxes/services start claiming benefits?

Sorry if I'm being thick here, I know there are alot of spongers working for the Civil Service, but I cannot see where the extra revenue will come from to pay them on benefits.

Having taken a moment to reflect, I am actually quite bitter but only in that we holidayed 20 minutes from Coed y Brenin and I wasn't allowed to take my bike.

jimster – where do you think the money comes from to pay public sector salaries? From the private sector as far as I can see (or borrowing).

The public sector pays tax, but the salary they're paying tax on comes from tax taken from the private sector. By it's very nature the public sector isn't a wealth generating sector. Do you pay someone £30k per year to take back £5k in tax or pay them £10k per year in benefits? As harsh as it seems it's got to be more cost effective providing services aren't affected too dramatically. Numbers are a guess but the point remains.

LOL, I sort of know what you mean, I run my own company, my holiday is going to be a week in the Lakes…

It's not going to rain, it's not going to rain…If I say it enough it'll be true…

Lakes, nice. Haven't been for a long time, will you get the chance to do any riding?

Her Dad got up at 4am to drive them to the airport (60 miles each way) as she can't afford the train or airport parking, and he'll be collecting her when they get back. We (her family) pay her petrol money so she can come and visit (20 mile drive) because she apparently can't afford it.

I work over 40 hours per week and we just had a week in Wales for our holiday, next year we probably won't have one. No doubt you think I'm bitter, I'm just pointing out a situation that is probably repeated across the country.

That does sound annoying. Although looking at the cost of cheap food included European sunshine holidays in our high street travel agents, I reckon it is often way cheaper than a UK holiday if you're not fussy about exactly what holiday you go on.

Joe

By it's very nature the public sector isn't a wealth generating sector.

Are you sure? Isn't that a bit dumb if you think about it?

Ever heard of Universities? They make a lot of stuff y'know, not to mention making it possible for a lot of companies to work. As an obvious example local to me, look at Rolls Royce Aerospace – they have tons of stuff done by and with universities, as well as employing tons of engineering graduates. They wouldn't be able to 'generate any wealth' without UK universities.

Lots of other things probably generate wealth in less obvious ways – for example by mending the roads, people can drive around and deliver things; the NHS must have a massive benefit to companies compared to in the USA, where private companies have to pay for the equivalent services for their employees (at about twice the cost too ; schools mean that companies have literate employees; councils organise waste collection meaning that we're not all sick, so are able to work.

There may be some public sector work that is not even indirectly increasing the ability of people to generate wealth, but I'd be surprised if it is very much if you think about it for a minute.

Joe

As harsh as it seems it's got to be more cost effective providing services aren't affected too dramatically.

The trouble is the positions that are cut are the people who do the work, not the workshy managers who arrange training weekends in a hotel at the far end of the country at the cost to the country because it comes from a different "budget".

tony – the issues is that the bit of money that those people no longer have no longer gets spent on goods and services – so the people who provide those goods and services make less profit / go bust. Thus reducing tax take all round.

IIRC 70+ % of all public sector salaries gets immediately back into the economy.

Cutting public sector will be self defeating as the benefits bill rises and the tax take falls – thus the deficit will not be reduced. Adjustments can be made if your ideology insists they must be – but to do it so quickly and harshly will damage the economy immeasurably. No other country in the world is doing so much cutting for so little deficit. Double dip recession here we come – its economic illiteracy of the highest order. The lesson from previous recessions has not been learnt by the tories – of if it has they are going ahead with this very damaging course for purely ideological reasons.

A quick aside here, a couple of months ago everyone(the press) were citing the Canadian economy as the example to follow – in as much they reduced a huge deficit in a couple of years or so. A reporter from Canada was on the radio explaining who it happened, basically a new Govt came in, consulted with everyone and explained what was going to happen, huge cuts in spending, increase in taxes etc etc and things went to plan. However, Canada's biggest trading partner at the time was America who were in a boom period and they effectively thrived off that.

Who are our trading partners, and are they not in recession too?

jimster – Member
The trouble is the positions that are cut are the people who do the work, not the workshy managers who arrange training weekends in a hotel at the far end of the country at the cost to the country because it comes from a different "budget".

I agree totally.

TandemJeremy – Member

tony – the issues is that the bit of money that those people no longer have no longer gets spent on goods and services – so the people who provide those goods and services make less profit / go bust. Thus reducing tax take all round.
But the money those people are no longer spending is provided indirectly by the very people that are relying on them to spend it?!

Tax take (income) goes down, but so does the salary bill (outgoings), so how does that make us worse off? I realise I'm taking a very simplistic view of things, but in hard times if you can't afford it you don't do it.

Either way we can't rely on consumerism alone, it's just a way to distribute the wealth that gets generated elsewhere, be that through producing stuff or providing services that people need. If a business is not viable then it should go bust, if the service that business provided was valid and useful then it's place will be taken by a more efficient and robust business. The job of the state should not be to support failed businesses, banks included.

I'm going to stop now because I'm confusing myself and need to actually do some work!

britain is leading the way in cutting its science budget, our director has warned us of up to 40% cuts
and complained bitterly that his peers in france and germany arent faced with the same funding issues, because everyone knows cutting R&D is a bad idea in a recession

and scrapping schemes like this?
http://www.bbc.co.uk/news/education-10912723
short term budget savings but long term damage toc ommunities
and as pointed out in the article proves the 'big society' was just empty politician words

. If a business is not viable then it should go bust, if the service that business provided was valid and useful then it's place will be taken by a more efficient and robust business.

Your faith in market forces is touching, but is something only valid and useful if it's possible to make a healthy profit out of it? Personally I don't want to live in a society where every single aspect of life is about wringing profit out of it. And no I am not a state employee btw.

And re the Labour-Tory thing – yes Labour were guilty of similar tabloid-pandering rhetoric, but the Tories seem to have even fewer reservations about picking on the weak and powerless.

BTW the dreaded 'double-dip' seems to happening right about now – well done Dave…

Tony – to oversimplify – the profits by the local shopkeeper drops to perhaps to the point where he is no longer profitable thus he ends up on the dole paying no taxes as well. certainly the taxes he pays are reduced as well

the other point tony is that these are no t hard times and we can easily afford it. Its an idealogical choice

jimster – Member
Can someone explain to me how we are going to pay for the public sector workers who's jobs are cut, will stop paying taxes/services start claiming benefits?

Haven't you heard? We're going to unprecedented economic growth in the private sector, Osborne said so.

The public sector pays tax, but the salary they're paying tax on comes from tax taken from the private sector. By it's very nature the public sector isn't a wealth generating sector. Do you pay someone £30k per year to take back £5k in tax or pay them £10k per year in benefits? As harsh as it seems it's got to be more cost effective providing services aren't affected too dramatically. Numbers are a guess but the point remains.

WTF!?

Another example of how the cuts will actually harm private enterprise and cost more money in the long run:

http://www.telegraph.co.uk/finance/5084548/Regional-development-agencies-deliver-value-for-money.html

grum – Member
Your faith in market forces is touching, but is something only valid and useful if it's possible to make a healthy profit out of it?

I'm not saying everything should be subject to market forces, of course I don't beleive that essential public services such as the NHS, binmen, etc should be driven by profit. I do think it would be nice to know that the money we pay in taxes to finance these services is spent wisely though.

Personally I don't want to live in a society where every single aspect of life is about wringing profit out of it.

Me neither, ortherwise I'd move to America.

BTW the dreaded 'double-dip' seems to happening right about now – well done Dave…

In Dave and George's words "We're in this together"

A bit like Vanessa Feltz reassuring an anorexic!!

Haven't you heard? We're going to unprecedented economic growth in the private sector, Osborne said so.

As I asked later

Who are our trading partners, and are they not in recession too?

more to the point wtf do we have to trade?
canada made it out of its slump because of its huge wealth in natural resources and growing manufacturing base
we have neither

BTW the dreaded 'double-dip' seems to happening right about now – well done Dave…

Hmmm, I think maybe it's too early for this lot to have had that kind of impact – it was gonna happen whatever.

Trading partners jimster? Well the rest of the developed world of course. You know, all those countries coming out of a recession like us and trying to rebalance their economies like us, and hoping export growth will fund the return to, and then sustain growth, like us.

tiger_roach – Member
Hmmm, I think maybe it's too early for this lot to have had that kind of impact – it was gonna happen whatever.

I wouldn't be so sure. Cancelling a huge schools building program is going to have an immediate impact on the construction sector. Plus the markets function – in part – on confidence and future expectations, the new govt has a great influence over that. Impeding job losses in the public sector will impact people's consumption decisions. Cuts to public sector spending will have similar effects for private sector contractors who rely on public monies for work.

Tiger – nope – its two things are impacting on the figures atm – both teh condems fault.

VAT rise and confidence.

http://www.bbc.co.uk/news/business-10934302

Hmmm, I think maybe it's too early for this lot to have had that kind of impact – it was gonna happen whatever.

Well, except that lack of consumer confidence due to massive job cuts is stalling spending and the housing market etc etc

'm not saying everything should be subject to market forces, of course I don't beleive that essential public services such as the NHS, binmen, etc should be driven by profit.

I'm not sure that your chosen political party agrees with you there.

I do think it would be nice to know that the money we pay in taxes to finance these services is spent wisely though.

Agreed – I just have absolutely zero confidence that Cameron etc actually give even the slightest shit about it, let alone are capable of sorting it out.

kimbers – Member

more to the point wtf do we have to trade?
canada made it out of its slump because of its huge wealth in natural resources and growing manufacturing base
we have neither
How's the drilling going off the Falklands? Did they hit oil yet? It's all gone quiet.

Fingers crossed that could solve all of our problems – lots of lovely oil money to the rescue, and another war with Argentina to boot! There's nothing like a good war (that we might be able to win) to divert everyones attention.

CaptJon / TJ

Yep but it's still too early to see the impact in the stats; house prices are starting to fall it seems but that ain't because of the new Gov't.

the inside buzz in the oil industry is that any oil thats in the falklands is very hard to reach and theres not very much of it, theyve been looking there for at least the last 20 years and not found any so far

it says more about the lack of oil left in the north sea that they are willing to send rigs from there to the bottom of the world

The Bank said the main factor behind its prediction that inflation would remain higher than previously forecast was the government's decision to raise VAT to 20% from 17.5% at the start of next year.

house prices are starting to fall it seems but that ain't because of the new Gov't.

Why is it then genius? How can you be so sure.

Nationwide's monthly consumer confidence index released today also shows households are growing more wary about making major purchases, are more cautious about the housing market and increasingly believe their income will fall over coming months.

In its first report since George Osborne presented his emergency budget in late June, Nationwide said its headline consumer confidence index for July stood at 56, down sharply from 63 in June and the lowest since the depths of the recession in April 2009. It has now fallen for three straight months.

The expectations index – which reflects how people feel about the economy, labour market and household income over the next six months – was also the weakest since April last year.

http://www.guardian.co.uk/business/2010/aug/11/recession-unemployment-economy-government-cuts

Cuts to public sector spending will have similar effects for private sector contractors who rely on public monies for work.

Yeah, even if you can get them, you'd be mental to agree to a long term public sector contract now, with them cutting random stuff, as the link to the playground cuts above shows.

Joe

Hmmm, I think maybe it's too early for this lot to have had that kind of impact

Certainly having a huge impact in IT!

It's all just minor changes to the previous government's already announced policies really. No surprise, as you can't really change that much in a short time, despite all the breast beating that accompanies these announcements. Small changes to existing plans, big noises to seem to be doing far more.

grum – they will have an impact I'm sure but as house sales take months to go through the current stats don't reflect the most recent changes.

i think kelvin has a good point nulabs proposed cuts werent much different from the torries, if not as immediately drastic

its just that a lot of people were fooled by the great rupert murdoch -gordon is the devil- media hysteria whipped up pre-election to scare people into voting tory

The future is not necessarily as bleak as portrayed on here. First, the revised BofE forecast for growth of 2.5% for 2011 merely brings it into line with the government's own forecast at the time of the budget of 2.6%.

Second, exports are growing, despite the commonly held belief on here that this is impossible because we don't make anything. Exports grew 6.4% in the second quarter compared to the previous one and year on year growth was 15.5%.

What is interesting about the BofE growth forecast is actually the reporting of it. The BofE does not make a central growth forecast instead it publishes fan charts. It is from these that the media derive the numbers. Both the Guardian and the Telegraph have derived 3%, whilst the BBC has derived 2.5%. What does this say about the BBC spreading doom and gloom?

I have no doubt that Cameron will turn out to be a colossal twunt, however Brown was a colossal twunt as was Blair, as was Major.

However bad this current bunch turn out to be, I'll never quite get over the let down last bunch of barstewards turned out to be. For that reason I'll never, ever vote Labour again.