Oh I think you're right, however, the private sector will [ilead[/i us out of recession as I said in my post.

Government policy is never apolitical and it has a direct baring on how or if money is invested in the UK economy.

It is very political of the government to suggest the kind of investment you mention would be happening at a sufficient level to offset the rising level of unemployment we see. I think the answer to that politically motivated suggestion is simply "no, it's not".

If you look at the unemployment figures you can see two sets of stats. The number of jobs lost and the number of jobs created. If you look what you will see is that while many permanent jobs (many in established industries) are lost the kind of jobs created are often part time and in sectors that at little to no value to the economy (i.e. they are not involved in any kind of activity that adds value such as manufacturing).

I for one am rather sick of hearing that Tesco's or Morrison's are opening X number of new stores and so will employ a few thousand people because while no doubt those getting the jobs want them, these jobs are just not the same as an employer like BAE taking on large numbers of people.

The idea the private sector will step in to take up the slack as the public sector is cut back is simply not working. The idea it would was nothing more than a politically inspired theory and the actual observed practice says it is not working.

A big factor why it isn't working is that private industry is sitting on a vast pile of cash it is simply not investing in the UK economy. I read somewhere yesterday it amounts to £750bn!

This makes it all the more crazy to cut corporation tax (something that has seemingly gone unnoticed in the budget) because all this will do is give private industry even more cash to sit on. So instead of being available to the government to invest directly in the UK economy the government chooses to give it to private industry who MIGHT invest it in the UK economy. Given private industry is NOT investing the money they already have, a cut in corporation tax at this time seems as bonkers to me as giving the rich a tax break by scrapping the 50p tax rate.

The governments decision to do this is again a political one. Or if you prefer idealogical.

My own view is that given the economy is in the state it is in the idea the private sector will come to the rescue is a forlorn hope. Therefore it is stupid of the government to take money out of the tax system and give it to companies when they have no idea other than a right wing theory that this will stimulate growth especially when current observed practices suggest that is just not happening.

Given current Government policy that's pretty much a dead cert.

It's also always worth blowing the trumpet for the public sector given how much bad press it gets generally. People easily forget that when the economy is functioning healthily the private and public sectors are pretty closely intertwined and interdependent.

Could you explain how, if a pensioner finds things difficult financially, they can find another pension provider paying a better rate or move to another part of the country that pasy a better pension? Maybe they could watch more daytime TV and qualify for overtime on their state pension eh?

It is not irrational at all. The reason pensioners got a higher personal allowance is because few of them are on much more than the £10,500 in the first place. My late fathers pension was £4000 a year from his company pension and a state pension on top. Not even £10,500. There will be plenty more who retire soon who will face paying tax on an income LESS that £10,500. That is grossly unfair and why pensioners got a higher tax allowance. To take all of those with a very small income out of paying tax on it.

As to their costs being lower you conveniently forget the cost of heating and electricity which when the house is occupied most of the day is a huge burden.

Any super rich pensioners on £100K or more don't get the personal allowance anyway.

Comparing a pensioners income to that of a younger person is bonkers as well. Younger people in employment have not contributed anything like as much tax and Ni as a pensioner and it is only right those of us in employment do as today's pensioners did which is make those contributions.

In any case why anyone begrudges people who have worked all their lives the extra tax relief they were getting above the working population is beyond me. It amounts to a 20% of the difference between the two allowances which is a grand total of £479 next year for new pensioners.

The fact anyone thinks it unfair or irrational is yet another triumph of selfish Tory propaganda.



But they didn't. They are definitely saving money by altering the way the tax allowances work for pensioners and it is not the freezing of the allowances that is the big issue but the abolition of them for new pensioners before the personal allowance reaches £10K. To save £3.3bn and hand back 5p in the pound to millionaires at the same time deserves all the flak it is getting.

I liked the comment of one of QT's panelists, 'I doubt giving the rich 5% off their tax will stop them from avoiding tax'

Gideon must think we are stupid and I reckon it will be the end of the Lib Dems, especially after Cables constant back tracking on his comments from before the election. Watch Cable, Clegg and the ginger to$$er Alexander defect to the Tory party at the next election.

Anyone who's income is little more than £10,500 is very likely to be in dire straits, whether they're a pensioner or not.

Thats the natural order of things particularly with huge manufacturing plants owned by international company's who often move production around the world to suit different political and economic pressures - thats a given.

What is galling is the way in which a spurious number of "newly" created vacancies are trumpeted in the press literally minutes after a budget has been announced and pinned entirely on the fact that said budget has now created the conditions that such international company's can work with - its sheer bollax and I am insulted that both the government and GSK can think that anyone would think otherwise - I don't for one minute think that the CEO of GSK sat with his little radio under the desk in some far-flung corner of the empire listening to the budget on Wednesday and then immediately reached for the phone and ordered three new plants for the UK on the strength of what he heard.

...and conveniently forgot to add that he'd slashed the UK workforce in a pretty vicious manner just a matter of a few short years ago anyway.

Spot on their mate. Weve got a van on Far Grange Skipsea and they are already struggling to sell new vans. Apparently a £30,000 van will now cost £36,000. Its like a double wammy from this shower as they know peaple cant afford the holidays abroad and just wanting a caravan holiday., and wont be able to afford the rental of one.

Interesting graphic from the OECD on rates of corporation taxhttp://images.newstatesman.com/corporation-tax.JPG" >

Gideon wants us to rush to the bottom, he still seems enamoured with the Irish Tiger model. Has someone told him yet that they've just gone back into recession?

Fair points.

Glad to see Nissan and Land Rover announcing similar investments in weeks leading up to the budget. I'm sure everyone would agree that these investments are more than welcome. GSK is one company - there are others prepared to invest and not even just after the budget. The company I work for couldn't give a rat's about budget timing I can assure you - nor were their investments even reported except at a local level.

Once again, purely apolitically, I hope there are many more companies just like these. Confidence will take time to improve to allow cash to be re invested. If it doesn't happen then the country has more to be concerned about than anyone making political points on here.

In my work I see lots of manufacturing businesses from north to south of the country and I hear confident stories of businesses being busy again, I've been in two food production factories this week, both with full production lines going and talking of reintroducing night shifts, and night shifts are to be avoided until your day shifts can't squeeze any more production out (its more expensive to run a night line).

The only down side to all of this is that both of those businesses, and its a common feature, are expanding their production by using agency labour and the one I was in yesterday isn't even using permanent agency labour, the employees are literally told the day before whether or not they have a shift tomorrow. Its good that there are now tighter regulations on the Agencies to provide sick pay and holidays etc etc, but its far from desirable to be telling 18 and 20 year olds that this is the way your life will work from now on, tomorrow you turn up here and we might give you work, but then again we might not, or you might turn up at 6am and we'll ask you to go home and come back at 2pm - and the rest of your working life is going to be like this.

Its how the mill workers used to run things in 1880.

No need to go that far back.

That's also how the docks used to work before decasualisation and that was well within my lifetime. To see grown men physically fighting for the right to a day's labour is a sight no one wants to return to

Well, most people don't want that to return. A few in government would be fairly happy to see it return. The only way to incentivise the low paid is to reduce wages and conditions. Keeps them on their toes y'see, and then will be grateful for the scraps of work provided to them by benevolent private sector owners.
Alternatively the highly paid can only be incentivised by more money.