I have stayed out of this debate so far, to see peoples comments, and no one can accuse me of being right of centre, because I am not. I have never voted tory in my life, an endangered species up here. But it is quite clear the left minded of the posters are quick to jump on anyone who dares says anything away from the left wing manifesto which is quite apparent. By all means argue the point, but no need to get personal. Its only a forum.
In answer to the question re the Budget deficit, how do you who are criticising the Government, propose what we should do to resolve not only the budget deficit but also the total borrowing. This is now running at over £900 billion and rising, by approx £140b this year, and by 2015 will be about £1.3 trillion, the interest will be a staggering £70b per year. This has to be paid regardless of income or expenditure. This is the interest on gilts, which have been issued to cover all the debt.
It has been stated these borrowings are not short term, like Greece, this may be true, but they will have to be paid in the near future. How on earth will we find the cash to pay any repayments? Look down the back of the sofa at Number 10 for some spare cash?
Do you suggest we should default? If we do then no one will lend another penny to UK plc. They will have to call in the bailiffs.
If you believe we can go on borrowing forever, with no limits you are seriously deluded. At some point we have to start repaying the debt. Even all these cuts don’t reduce the total debt by one penny, it is still increasing at an alarming rate.
So once again, what would you do, postpone cuts by 1 year? OK, then what.
It is easy to lambast those who can appreciate the huge problem, but you don’t come up with any alternatives to solve the problem. No use sticking your head in the sand, sticking pencils in your ears and going “wibble wibble”.
Now before you all jump on my throat, bear in mind Nu Labour were going to introduce, in their words “ cuts deeper than Thatcher”, so Alistair Darling knew we had to even if Broon failed to grasp it.
Am I happy with all the proposed cuts? No, not all them, but when your faced with a reduced income, you don’t go out and buy a new car, do you. Well that is what Labour were doing in the last few years. They were spending vast sums, even before the downturn in 2008, they had no idea how they were going to pay for it. I feel like Labour should have been re-elected, so they could fix the problem they created.
The banks do have a lot to answer for, they made a bad situation even worse. I have stated on many occasions that they should be paid no bonuses, again, until they have repaid every penny they got in the bailout. Plus I would levy the banks a “windfall tax” of sorts to claw back cash to hit them where it hurts.
Plus, not all the private sector is responsible for the financial mess, lots of companies up and down the Country have suffered greatly because of the banks stopping lending, forcing many to go bust. If a private company runs out of cash, it goes bust. Employees in many organisations have taken pay cuts and pay freezes, so that they can hold onto their jobs. They have no choice. They have accepted it, they don’t like it, but they understand the economics behind it.
The public sector have had a good run for their money in the last 10 years. I don’t object to doctors, nurses, police & fireman getting paid a decent salary, but the huge increase in the sheer numbers of people employed in back offices, doing non jobs (we have all had a go at them in the past), there are thousands and thousands of them up and down the Country, whereby if they lost their job it wouldn’t have any impact on front line services. We managed reasonably well before , with less, we will again, a slight increase in productivity will cover the staff reduction. Private companies manage it every day of the year.
Not all private employers are as big as Tesco, they cannot pay huge salaries, because they cannot increase their sales prices in a recession, because no one will buy their products, and the company will go bust. They either have to cut costs, or increase sales. No one will buy more of an item if you put up the price of it. Now that is pure economics.
On the subject of public service pensions, I read this article recently:
The average age at which Police officers retire – on a full, final-salary pension – is 49. In Tayside (where I live), the average retirement age is just 48. In the UK as a whole, it is 51. The figures do not include police officers that retire on health grounds, or because of injuries in the line of duty.
The average police officer will now live for 34 years after retirement, meaning they will spend longer drawing a police pension than they spent drawing a police salary. Tayside, and several other forces, already have more pensioners on their payroll than they have serving officers.
This is roughly similar across the UK. No system can survive people being able to draw pensions for longer than they worked.
The police, who do demanding jobs and pay quite high pension contributions, have traditionally been seen as a special case. But other public servants in rather less front line employment stop work surprisingly early, too. Foreign Office officials retire, on average, at 55. For bureaucrats of the Welsh Assembly Government, the retirement age is actually lower, at 50, than the average police officer.
The promise made to public-sector workers – a guaranteed pension, index-linked for life, based on two-thirds of whatever salary they might be earning on the day they retire – was drawn up at a time when most such workers lived only a few years after collecting the leaving card and the gold watch. That has changed dramatically. At the same time, the absolute number of public-sector workers has ballooned – and their pay, on which the pensions are based, has risen above inflation. The result is what the think-tank Policy Exchange calls "a second National Debt."
Last week's report by the newly-created Office of Budget Responsibility estimated that public sector pension costs would more than double, to £9.4 billion a year, by 2015 – with even steeper rises kicking in after 2015. But even this is, quite literally, only half the problem.
The vast majority of public sector pension schemes – including those for the police, civil servants, teachers and the armed forces – are "unfunded." This means that unlike in the private sector, the contributions paid by employees and employers have not been invested in, say, the stock market to produce returns that might pay for the pensions. No money at all has been set aside; the pensions are simply paid out of general taxation.
Even if the pension contributions had been invested, however, there would still – as the private sector has found – be a gap between the returns the stock market can raise and the amounts needed to pay "gold-plated" final-salary pensions to increasingly long-lived pensioners. The private sector has dealt with this problem by largely scrapping final-salary pensions. The public sector has dealt with it by providing a further, hidden subsidy from general taxation – at least another £10 billion a year.
"It is a huge subsidy to about 20 per cent of the working population at the expense of everyone else," says Neil Record, of Policy Exchange. Over the last few years, not only has the average private-sector worker seen his own future retirement income dramatically reduced, but he may well also be paying more – via his taxes – to the pensions of public-sector workers than he is paying towards his own pension.
In essence, the Treasury has been using contributions received for the next generation's pensions to pay the current generation of pensioners," says Mr Record. "That is exactly how a Ponzi scheme works. British public sector pensions are the biggest Ponzi scheme in the world. No other country's public pensions even come close.
We cannot have a two tier pension system, we have to have one for all, all for one system, where we all retire at the same age. Not 65+ for private sector and 60 or less for the public sector. Otherwise in the near future their will be a revolt, not by Unison calling strikes, but the private sector taxpayer waking up and smelling a rat.
The days of huge Government spending is dead for a very very long time.