Wilfred Aspinall is a member of Hitchin Conservative Association, a CPF Eastern Regional Ambassador and Former Chair – Forum in the European Parliament for Construction
As we begin a New Year we should examine how Great Britain, the 6th largest world economy, is really equipped to sort out the mess we are in.
Please don’t say the politicians have the answers – many are inexperienced in life and work activity. They seem to rely on Think Tank policies where those too fall into the same pattern. Then there are the economists, who basically predict from data what is happening and making recommendations that in many cases fall foul of common sense. Again many of these so called economists have never had real time creative jobs.
The Bank of England used to be the bankers Bank, with the Governor having had a lifetime as a banker. Now they are all economists.
2026 has to be the beginning of a different economic model which because of the failures during the last 20-30 years cannot just continue with policies of business as usual “steady as we go”.
There has been no growth in our economy, policies adopted to compensate and no encouragement for investment and job creation. Increasing public spending as the only way forward.
We need a strategy – a plan to guide us all into prosperity. It can be done but serious changes will be required.
Some of our Institutional structures are so decimated from throwing money at them which will not help as they are out of control in what they are supposed to be doing.
The NHS now just to big to provide for individuals needs. A massive workforce and management living just for today. With the funds provided how can it be acceptable that there are patients on trolleys in hospital corridors. It happens every year. Many NHS staff working part time including medical staff. A complete audit review is required
How comes local government are increasing council tax by a minimum of five per cent yet the staff only want to work a 4 day week and the majority of that working at home. (Same applies to the civil service)
How come the level of taxation is so high. The tax thresholds not keeping pace with rising wages. No incentive to work to get promotion and explore new work patterns.
How comes we have people on benefits that could be employed especially when pay on benefits exceeds pay in work. This has become a nightmare not just for now but for the future.
How comes that this modern economic style creates no incentive to work full time.
We simply cannot go on with business as usual. Economic pain will result and unemployment will rise, our whole society will become unproductive. We have to renew our economic thinking and get GB working.
In the 1970’s the then Labour (socialistic ideology) government introduced fiscal restraint on middle and higher paid earners; managers, professionals and other defined staff. This resulted in the “brain drain”. Many got jobs overseas to try and avoid high taxation. Many couldn’t as they were totally committed in the UK. (This is happening again)
The Labour government also created employment rules – following on from the document “In Place of Strife” sponsored by the Rt Hon Barbara Castle MP. They also introduced the concept of unelected quango organisations to do the thinking for them.
Some of us created an organisation to try and counter this policy bringing together Registered representational bodies totalling 1.5m managerial, professional and staff. That organisation existed until the mid 1990’s and assisted in presenting fiscal, pension etc and welfare opinions to politicians, ministers and Government.
Here we are in the mid 2020’s with a government made up of socialistic wealth distribution ideologists. Not understanding that in a modern economy growth is required and that means an economic strategy which creates incentive.
We currently Tax the middle and higher earners who attempt to mitigate that ideology by only working part time and the exchequer income falls which means in a market economy those that really suffer are the low paid resulting in aspiration destroyed.
I remind the reader that aspiration applies to all workers. We need an economy where as many people work full time to ensure that the market economy works for everybody.
We have a Welfare State unmanageable with no clear strategy to reduce the number of claimants. In fact just the opposite. There is no doubt many deserving of benefits but not +/- 10m
The UK market economy relies on funds circulating round. We need to break the part time, four day week and working from home approach. Our economy continues to flat line and we need reality into the whole fabric of pay to encourage work.
The tax thresholds are frozen until 2031 which means that those on middle and high incomes have no incentive to work full time. Pensioners and even the low paid caught in this fiscal drag trap resulting in lower exchequer revenue. Lower paid employees ceasing to feel satisfied if they can have more on welfare benefits.
The U.K. market economy requires flexibility. If the exchequer revenue from the middle and upper earners goes down and there is no resultant increase in consumer spending. If the small business just working within a sustainable margin has to register for VAT, put up their prices by 20 per cent, NIC increased with the effect that they stop using additional employees and even lay off existing staff.
The result is that the market economy is under stress.
The lower paid jobs cease to exist and the middle and high earners either leave the country or reduce their income (part time) and the exchequer income falls. As a result government debt goes up.
Overall not a good result and the financial markets downgrade and borrowing gets more expensive. We slip from being the 6th largest world economy perhaps to 7th or 8th. Interest charges on debt increases. We turn to the IMF for a bailout.
So what is the solution:
- Review the tax thresholds to encourage and incentivise people to be more productive. Earn more, pay their taxes, have more in their pockets resulting in higher consumer spending
- Initiate an overhaul of the tax system. Make it simpler, advance the small state ideology, increase funds for people to spend as they wish.
- Look at potential for a new system such as introducing a flat rate, the potential to have a state tax and a local tax (devolution costs of certain aspects such as social care in the community, breaking up specific NHS activity bringing in more democratic local accountability.
- Introduce an equitable pension scheme for all – outside the exchequer balance sheet under an actuarial structure
- Encourage small businesses by increasing the VAT threshold to £150k and eventually scrapping the NIC altogether but immediately reducing the employers contribution
- Creating an overall ideology that work pays and increasing consumer spending as a result of lower taxes. This in turn would initiate a strategy of new jobs (some initially below the tax threshold but aiming for better productivity to increase their pay. (In many ways the minimum wage has been a disincentive for advancement and perhaps we should return to the philosophy of the market rate)
- Initiate a radical review of all welfare state spending bringing the basic thinking back to benefits only used as a safety net.
- Taking steps to scrap all regulations that delay or hamper growth and scrap the unelected organisations that control them. Scrap the national Quango organisations
- Build more houses, use our expertise to fast track and build useful – education, rail, road, airport and health infrastructure. Scrap the regulations, build quicker see the trade grow
- Exploit our expertise to create indigenous energy production using gas and oil exploration, new nuclear power plants and country wide SMR’s (small modular reactors), advance all renewable energy production (solar, wind, etc). Reduce energy prices
- Examine our UK financial services and potential tax opportunities on the world scene to take advantage of this sectors expertise to attract inward investment based on our position outside the EU.
- Adopt a policy of prosperity for all our citizens for a happier and more fruitful existence
Wilfred Aspinall is a member of Hitchin Conservative Association, a CPF Eastern Regional Ambassador and Former Chair – Forum in the European Parliament for Construction
As we begin a New Year we should examine how Great Britain, the 6th largest world economy, is really equipped to sort out the mess we are in.
Please don’t say the politicians have the answers – many are inexperienced in life and work activity. They seem to rely on Think Tank policies where those too fall into the same pattern. Then there are the economists, who basically predict from data what is happening and making recommendations that in many cases fall foul of common sense. Again many of these so called economists have never had real time creative jobs.
The Bank of England used to be the bankers Bank, with the Governor having had a lifetime as a banker. Now they are all economists.
2026 has to be the beginning of a different economic model which because of the failures during the last 20-30 years cannot just continue with policies of business as usual “steady as we go”.
There has been no growth in our economy, policies adopted to compensate and no encouragement for investment and job creation. Increasing public spending as the only way forward.
We need a strategy – a plan to guide us all into prosperity. It can be done but serious changes will be required.
Some of our Institutional structures are so decimated from throwing money at them which will not help as they are out of control in what they are supposed to be doing.
The NHS now just to big to provide for individuals needs. A massive workforce and management living just for today. With the funds provided how can it be acceptable that there are patients on trolleys in hospital corridors. It happens every year. Many NHS staff working part time including medical staff. A complete audit review is required
How comes local government are increasing council tax by a minimum of five per cent yet the staff only want to work a 4 day week and the majority of that working at home. (Same applies to the civil service)
How come the level of taxation is so high. The tax thresholds not keeping pace with rising wages. No incentive to work to get promotion and explore new work patterns.
How comes we have people on benefits that could be employed especially when pay on benefits exceeds pay in work. This has become a nightmare not just for now but for the future.
How comes that this modern economic style creates no incentive to work full time.
We simply cannot go on with business as usual. Economic pain will result and unemployment will rise, our whole society will become unproductive. We have to renew our economic thinking and get GB working.
In the 1970’s the then Labour (socialistic ideology) government introduced fiscal restraint on middle and higher paid earners; managers, professionals and other defined staff. This resulted in the “brain drain”. Many got jobs overseas to try and avoid high taxation. Many couldn’t as they were totally committed in the UK. (This is happening again)
The Labour government also created employment rules – following on from the document “In Place of Strife” sponsored by the Rt Hon Barbara Castle MP. They also introduced the concept of unelected quango organisations to do the thinking for them.
Some of us created an organisation to try and counter this policy bringing together Registered representational bodies totalling 1.5m managerial, professional and staff. That organisation existed until the mid 1990’s and assisted in presenting fiscal, pension etc and welfare opinions to politicians, ministers and Government.
Here we are in the mid 2020’s with a government made up of socialistic wealth distribution ideologists. Not understanding that in a modern economy growth is required and that means an economic strategy which creates incentive.
We currently Tax the middle and higher earners who attempt to mitigate that ideology by only working part time and the exchequer income falls which means in a market economy those that really suffer are the low paid resulting in aspiration destroyed.
I remind the reader that aspiration applies to all workers. We need an economy where as many people work full time to ensure that the market economy works for everybody.
We have a Welfare State unmanageable with no clear strategy to reduce the number of claimants. In fact just the opposite. There is no doubt many deserving of benefits but not +/- 10m
The UK market economy relies on funds circulating round. We need to break the part time, four day week and working from home approach. Our economy continues to flat line and we need reality into the whole fabric of pay to encourage work.
The tax thresholds are frozen until 2031 which means that those on middle and high incomes have no incentive to work full time. Pensioners and even the low paid caught in this fiscal drag trap resulting in lower exchequer revenue. Lower paid employees ceasing to feel satisfied if they can have more on welfare benefits.
The U.K. market economy requires flexibility. If the exchequer revenue from the middle and upper earners goes down and there is no resultant increase in consumer spending. If the small business just working within a sustainable margin has to register for VAT, put up their prices by 20 per cent, NIC increased with the effect that they stop using additional employees and even lay off existing staff.
The result is that the market economy is under stress.
The lower paid jobs cease to exist and the middle and high earners either leave the country or reduce their income (part time) and the exchequer income falls. As a result government debt goes up.
Overall not a good result and the financial markets downgrade and borrowing gets more expensive. We slip from being the 6th largest world economy perhaps to 7th or 8th. Interest charges on debt increases. We turn to the IMF for a bailout.
So what is the solution: