Saturday 31 August 2013

Saturday, August 31, 2013 Posted by Jake 1 comment Labels: , , , , ,
In October 2012 Eric Pickles, Secretary of State for Communities and Local Government, introduced a new bill. The “Growth and Infrastructure Act 2013” sounded like a good thing. Who wouldn’t want some growth and some infrastructure? However, hidden in the bill is “Employee Shareholders” legislation that destroys employees' rights. We wrote about it back then when the bill was first introduced, and are disappointed none of the 'great and good'  of our nation managed to strangle it.

Why these fundamental changes to the “Employment Rights Act 1996” were implemented by Pickles’ Department for Communities and Local Government and not by Iain Duncan-Smith’s Department for Works and Pensions perhaps exposes a low Duncan-Smith was not prepared to go down to. In April 2013 the bill became law, and from September 2013 these new employment contracts can be written and employees’ rights endure the following beating:

Among the rights lost are the right to training; the right for flexible working; protection against unfair dismissal; the right to redundancy payment:
An employee who is an employee shareholder does not have—
(a)         the right to make an application under section 63D (request to undertake study or training),
(b)         the right to make an application under section 80F (request for flexible working),
(c)         the right under section 94 not to be unfairly dismissed, or
(d)         the right under section 135 to a redundancy payment.

In return, the employer is supposed to give the employee between £2,000 and £50,000 (can be more, but tax protection is limited to £50k) of “shares”. However, these aren’t shares as we know them. The employer can decide whether these pieces of paper do or do not have the rights shares usually have:

  • Voting rights.
  • Rights to dividends.
  • Rights to a share of surplus assets if the company is wound up.
  • Right to be sold (the employer can place restrictions on who can buy the shares – e.g. they can only be sold back to the employer. And whether the shares have ‘drag along’ or ‘tag along’ rights when the company itself is being sold)
Quite apart from not having rights to vote, dividends, etc. this creates another key weakness for these ‘shares’. Because they have fewer rights than real shares they can’t be valued against real shares. So they are worth pretty much whatever the employer says they are worth when he takes them back (at the time of your sacking).

In short, what do you call a share that has no votes, no dividends, and can only be sold to whomever the employer says? Answer: bog-roll.

The prime beneficiaries of this change in employment law will be companies that tend to get into hot water with current employment law. The Department’s own impact assessment states that the cost benefit for companies that don’t have to pay out for breaching employment law is just £43 per year per employee – that’s 83 pennies a week:

"Not including tribunal awards and settlement payments, our estimated  expected avoided cost per individual that a company employs as an  employee shareholder rather than an employee is around £43 each year.  This avoided cost is related to the fact that an employee shareholder does not have certain statutory employment rights."

Thursday 29 August 2013

Thursday, August 29, 2013 Posted by Hari No comments Labels:
Furniture and carpet retailers investigated over bogus “bargain” claims
Carpetright and ScS are among six chains accused of inflating prices for short periods in order to mislead shoppers into believing they are getting a bargain during sale periods. Typically, just 5% of products were sold at the artificially inflated reference price, while a significant number of products were found to have never been sold at that price level. GUARDIAN

Employers who pay below minimum wage to be actively named and shamed, at last
Minister says the current system of issuing financial penalties, without naming the offending employer, has not sufficiently deterred companies from underpaying staff. The policy could embarrass hundreds of companies which pay below the minimum wage of £6.19 for people over 21. In the last tax year HM Revenue & Customs, which enforces minimum wage laws, found 736 employers who were paying staff too little, leading to the recovery of £3.9m in unpaid wages for more than 26,500 workers. Since 2011, when rules were first relaxed to allow officials to name and shame the worst offenders, just one company – a hair and beauty salon in Leicester – has been exposed. GUARDIAN

Police called in over alleged fraud by Serco staff
A government audit has shown that some Serco staff were recording prisoners as having been ready for court when in fact they were not. This data is regarded as a key performance measure for the £285m contract with Serco that could determine whether or not it is terminated. Last month the Serious Fraud Office launched an investigation into potential overcharging by tens of millions of pounds by the private security company G4S on a £700m contract for the electronic tagging of offenders. GUARDIAN

Private patients 'paying too much' through lack of competition
Most patients in UK private hospitals are paying more than they should for treatment because of a lack of local competition, says the Competition Commission. More than 100 private hospitals around the country are in areas with little rival healthcare provision, and many of these hospitals are owned by three major groups. The Competition Commission said it believed that the lack of local choice pushed up health insurance premiums for all patients. BBC NEWS

Tuesday 27 August 2013

Tuesday, August 27, 2013 Posted by Hari No comments Labels: , , , , , , ,

Saturday 24 August 2013

Saturday, August 24, 2013 Posted by Jake No comments Labels: , , , , ,
In August 2013 the Office for National Statistics (ONS) revised the second quarter growth figure from a spongy 0.6% to a strident 0.7%. This allowed George Osborne and the Tories to trumpet that the economy was "moving from rescue to recovery". Recovery will happen eventually, maybe sooner, maybe later. 

But just as it is hard to say whether the man running in front of a raging bull is leading it or being chased by it, it will be hard to say what role the Chancellor's policies have in our economic recovery.

The banker induced economic crisis, like all busts and all booms, is transitory. Governments are using a transitory crisis to inflict permanent pain including cuts to pensions, pay and benefits, the proliferation of 'zero hour contracts', and changes to employment law eroding workers' rights. What we sacrifice in the bad times will not be returned to us in the good.

It is not because our economy can't afford the costs of health, education, pensions, workers rights etc. While the banker induced crisis knocked us back for awhile, the medium term GDP forecast shows a very healthy growth trend (see graph of government forecasts below). 

The economy is strong enough to support us. The Credit Crisis is being used as cover to increase inequality.

The underlying reason we ordinary Ripped-off Britons are becoming too expensive is that our share of our nation's wealth is being reduced. The national pie is getting bigger but our share is being cut down faster:

Thursday 22 August 2013

Thursday, August 22, 2013 Posted by Jake No comments Labels:
David Cameron condemned over ‘ridiculous’ reforms to the £2bn lobbying industry
The head of the Commons committee scrutinising David Cameron’s flagship law to end Britain’s lobbying scandals called it a “useless dog’s breakfast” and said the Government should urgently postpone its current fast-tracked progress through Westminster. Research published last month by the Association of Professional Political Consultants (APPC) showed ministers in the Department for Business held 988 meetings with lobbyists in 2012. But, under the new law, just two were with consultant lobbyists who would have been obliged to declare the meetings. INDEPENDENT

Jeremy Hunt plans sale of confidential patient medical records to private firms
Confidential medical records may be offered to private companies for as little as £1, according to plans drawn up by officials. The new General Practice Extraction Service will consolidate NHS patient records sent to a central database by GPs around the country. The project has been described by campaigners as an "unprecedented threat" to medical confidentiality. The records will be anonymised but will include details of medical conditions. Private firms such as Bupa are able to purchase the records for research by applying to the Health Service. DAILY MAIL

Credit card protection compensation package set to total £1.3bn
Around 7 million people are set to share up to £1.3bn in compensation after 13 high street banks and credit card companies agreed to offer redress for mis-sold credit card and identity theft protection. They contracted card insurer CPP to sell the policies. The watchdog criticised them for promising customers up to £100,000 of insurance cover for their cards - something they did not need because they were already covered by their banks. GUARDIAN

Average earners 'will be £1,500-a-year worse off' under the new flat-rate state pension
Someone earning £26,000-a-year with a full employment record could lose out to the tune of £29-a-week when the new single-tier state pension is introduced, the TUC has claimed. The report says that anyone with a long working history is likely to lose out, sometimes by as much as £2,000 a year. The second state pension will be abolished when the new single-tier pension begins in April 2016. But the government said the changes will make most people better off. The Trade Unions support the principle of the single-tier pension, but want it to be raised from the current notional level of £144 a week. DAILY MAIL

Worst UK pension annuity providers named: Scottish Widows, Clerical Medical and Royal & Sun Alliance
Britain's worst pension providers have been named for the first time in official tables that reveal how some insurers are paying annuities 30% below the best deals on the market. Scottish Widows and Clerical Medical, part of the government-backed Lloyds Banking Group, have emerged as the worst providers of retirement incomes for the mainstream market. Many savers in pension schemes are unaware and not told that when they retire, they can shop around with the pot of money they have accumulated. GUARDIAN

Wednesday 21 August 2013

Wednesday, August 21, 2013 Posted by Jake 7 comments Labels: , , ,
This fascinating graph from a report by the Open University and Manchester University, Rebalancing the Economy (Or Buyer's Remorse), illustrates the decline of manufacturing in Britain:

More interesting than the 24% coming from "low-cost" countries (India, Turkey, Eastern Europe) in 2010, is the 40% coming from "high-cost" Western Europe. It is this 40%, not captured by cheaper labour costs,  that shows Britain's decision to voluntarily withdraw from manufacturing. When banks are in trouble the government pours out limitless rescue money - when manufacturing needs support the public purse is tightly shut. Using goods and services from overseas is an inevitable and generally positive result of globalisation. But, as the report observes: 

"It is of course true that we live in a world in which the manufacturing sectors of all high income countries are increasingly dependent on imported components and assemblies. But in the UK, the propensity to import is much higher, no doubt because of the reliance on foreign owned assemblers operating in global systems: in British machinery and vehicles 50% of intermediate purchases are imported as against just 30% in Germany where the propensity to import is much lower"

For those lefties who want to blame the Tories for the withering of manufacturing, the following graph from the same report exposes the Labour governments dismal record under Tony Blair. As the report states: 

Tuesday 20 August 2013

Tuesday, August 20, 2013 Posted by Hari 1 comment Labels: , , ,

Saturday 17 August 2013

Saturday, August 17, 2013 Posted by Jake No comments Labels: , , ,
Companies dodge tax like rats dodge peckish weasels. Which at first glance is not unreasonable. But when it comes to tax the weasel has been hamstrung by tax legislation carefully designed by governments around the world to be feeble and loophole ridden. 

Governments simultaneously collude and compete with one another to provide gaps that expensively advised companies can drive their earnings through. Providing highways and byways for companies like Amazon, Google and Starbucks to shift UK profits to low tax countries thereby comprehensively dodging UK tax. 

One such gaping loophole is to finance a company with debt instead of equity. An example of this is provided in a report by Richard Murphy, the tax campaigner, on the devices used by Npower to dodge paying tax in the UK

Thursday 15 August 2013

Thursday, August 15, 2013 Posted by Hari No comments Labels:
UK wages decline among worst in Europe
UK average hourly wages have fallen 5.5% since mid-2010, adjusted for inflation. In 2009, the average public-sector worker earned about £16.60 per hour, which dropped to about £15.80 in 2011, the IFS said. Meanwhile, hourly pay for private-sector workers in 2009 was just over £15.10 and dropped to about £13.60 in 2011. Across the European Union as a whole, average wages fell 0.7%. Only Greek, Portuguese and Dutch workers have had a steeper decline in hourly wages, the figures showed. The GMB union said "Employers paying low wages get taxpayer subsidies in the form of tax credits to assemble a workforce for them to make decent profit margins." BBC NEWS

Serious Fraud Office admits losing thousands of documents linked to BAE investigation
The Anti-fraud unit says last year it accidentally sent 32,000 pages obtained as part of investigation into defence firm to the wrong person. 3% of the documents have not yet been recovered. The documents had been compiled during a six-year investigation into allegations that BAE had paid bribes around the world to secure lucrative arms contracts. GUARDIAN

US fast-food workers in vanguard of growing protests at 'starvation' wages
Dozens of profitable Wall Street-listed fast food and retail chains are being rocked by unprecedented workforce- and consumer-led protests. The one-day protests struck not only McDonald's, Wendy's and KFC but also more expensive retail stores such as Nike, Macy's and Victoria's Secret. Last month McDonald's made headlines after it published a guide budget for employees living on the minimum wage – a gesture that backfired after the firm's own calculations showed survival on what it paid was only possible with a second job or if you live without a food budget or heating. GUARDIAN

Official youth unemployment nudges 1m as think-tank claims it's more like 1.3m - and HALF have never done a day's work
The so-called claimant count fell by 29,200 in July - the ninth consecutive monthly drop - to 1.4million, the lowest since February 2009. Total unemployment, including those not eligible for benefit, fell by 4,000 in the quarter to June to 2.5million. But unemployment among 16 to 24-year-olds increased by 15,000 to reach 973,000, while the number of people out of work for more than two years rose by 10,000 to 474,000, the highest since 1997. DAILY MAIL

Gas and electricity bills could rise by £140 before winter (despite energy companies making £3.3bn profits since last election)
Labour said the figures show that David Cameron has not done enough to crack down on profiteering by gas and electric firms. According to Ofgem’s latest Electricity and Gas Supply Market Indicators, the typical domestic dual fuel bill now stands at £1,420 a year, compared to £1,105 in May 2010 when David Cameron became Prime Minister. DAILY MAIL

Tuesday 13 August 2013

Tuesday, August 13, 2013 Posted by Hari No comments Labels: , , , ,

Saturday 10 August 2013

Saturday, August 10, 2013 Posted by Jake 3 comments Labels: , , , , , , , , ,
If you thought the only way to outsource public services was to hand them over wholesale to Capita and G4S you'd be wrong. For some years government departments' use of consultants and interim staff has de-facto outsourced central government functions to a staggering degree. 

This has actually been most stunning in the period before the current Conservative-Liberal coalition government, a time when Labour were in power. Maybe the current coalition government no longer needs to hire so many consultants for hospitals, schools and prisons. After all the hospitals, schools and prisons themselves are being handed over wholesale to the consultants, not to advise on but to own and extract profits from. Even if the new owners do hire consultants, they aren't on the government's books.

Data below is from the National Audit Office's (NAO's) report "Central government's use of consultants and interims". Here we found a truly gob-smacking graph showing the cost of consultants was 40% or more of total staff costs in the Departments of Transport, Education, Energy, and the Home Office. 

What is a minister to do? Given the choice of public servants serving the public, or a consultant hand-picked, hired, paid, bonussed, and under threat of being fired by the minister himself?

Is it a coincidence that the departments most enthusiastically shovelling public money into private purses, Transport; Energy; Education; Health, are the heaviest users of consultants?

Thursday 8 August 2013

Thursday, August 08, 2013 Posted by Jake No comments Labels:
Tax evasion prosecutions focus on middle classes, not the rich and corporates
A total of 617 people were prosecuted in the financial year 2012-13, up from 302 the previous year, with more white-collar businessmen and women and landlords being hit. Rather than individuals who owe hundreds of thousands of pounds, HMRC is chasing people like doctors, dentists, lawyers, construction contractors, restaurant owners and buy-to-let investors who have not declared amounts in the tens of thousands. Investigators have been focusing more on middle-class tax-evaders rather than the super-rich, who are harder to prosecute. As part of the 2010 Spending Review, Her Majesty’s Revenue and Customs (HMRC) was given an extra £1billion to tackle tax avoidance. TELEGRAPH

More than a million UK workers are on zero-hours contracts with no guarantees of shifts or work patterns - four times official estimates
The Business Secretary Vince Cable fears zero-hours contracts are being abused after research suggested a million people could be working under them. However, he pointed out that in many cases the level of flexibility offered by the contracts suited employees. "It can work for the worker as well as the employer," he told the BBC. ONS stats also say 21.7m are working full time and 8.1m part time. BBC NEWS

Attack on rip-off 0844 GP phone numbers that can hit patients with unexpected charges of up to 41p per MINUTE
The NHS Choices website, which describes itself as the ‘front door to the NHS’ has been found guilty by the Advertising Standards Authority of promoting these expensive GP numbers without spelling out the cost involved. More than 900 GP practices across the country use 0844 numbers despite official guidance from the Department of Health and the NHS hierarchy that they should not do so. Callers with a mobile can be charged up to 41p a minute to reach these numbers – more than double the figure for a normal geographic number beginning 01 or 02. Many people dialling their local GP from a landline would get the call free under their call package, however dialling an 0844 number can generate a charge of 5p a minute plus a 13p set-up fee. Some of the income from the calls goes direct to the GP surgeries to subsidise the cost of their telephone systems. DAILY MAIL

Workers 'set to lose £6,660 from their wage packets between 2010 and 2015'
Workers will be earning £1,520 a year less by 2015 than in 2010 - amounting to a loss of £6,660 in real terms over five years. The total would be enough to pay for the average family weekly shop for a year and a half or buy a small car, according to the Labour party, which based the figures on analysis of Office for Budget Responsibility forecasts. The figures also reveal a widening north-south income divide, with real wages now 8.1 per cent lower in Yorkshire and the Humber compared with a 5.5 per cent fall in the south east. DAILY MAIL

Tuesday 6 August 2013

Tuesday, August 06, 2013 Posted by Hari 3 comments Labels: , , , , ,

Saturday 3 August 2013

Saturday, August 03, 2013 Posted by Jake 2 comments Labels: , , , , ,
From a report by the Parliamentary Select Committee on Energy and Climate Change:

"Rising energy costs are the major factor in the upward trend in fuel poverty; the table below shows the movement in domestic gas and electricity prices since the low point of the early 2000s. The most recent official statistics indicate that 3.5 million households in England were fuel poor in 2010 and the Government has estimated that 3.9 million households were in fuel poverty in 2012."
It will not have escaped your notice that the steepest rise was during the previous Labour governments. Something the Tory-LibDem coalition has failed to reverse.
Saturday, August 03, 2013 Posted by Jake 1 comment Labels: , , , , ,

UPDATE NOV 2016: In 2012 so-called “avoidable” winter deaths were at 24,000. Since then the death rate has almost doubled. According to the latest ONS figures, almost 44,000 “excess” deaths were recorded for the winter of 2014/15. This was the highest number recorded since 1999, with 27% more people dying in the winter months compared with the non-winter months. The majority of deaths (36,300) occurred among people aged 75 and over, with cold weather and underlying health conditions cited as key causes. Virulent strains of winter flu, along with housing conditions and energy bills, are also thought to be contributing factors.

From a report by the Parliamentary Select Committee on Energy and Climate Change, here is an extract of evidence provided to the Select Committee by the National Pensioners Convention:

"Every year, mortality rises by 19% in the winter months in England. This amounts to an average of 27,000 “excess” winter deaths (EWDs); 90.8% of which last year were in the over 65 age group.

The majority of these deaths occur among older people, especially women, and those with underlying health problems. However, they are not people who would have otherwise died at that time. Most deaths are due to cardiac disease, strokes and respiratory problems, not hypothermia.
The Marmot Review Team also found there was a greater risk of death in colder housing than in the warmest housing, estimating that 21.5% of all excess winter deaths could be attributed to cold homes.
Excess Winter Deaths

Friday 2 August 2013

Friday, August 02, 2013 Posted by Hari No comments Labels: , , , , ,
Fee, KJ and Chris look for evidence...

Thursday 1 August 2013

Thursday, August 01, 2013 Posted by Jake No comments Labels:
Bamboozling bills, a spineless watchdog and policies that cripple the poorest: MPs slam energy market that fails hard-pressed households 
The damning report by MPs slams the energy giants for lack of transparency around profit margins. It also lays into the regulator, Ofgem, for not forcing suppliers to be more open about profits, and says energy efficiency funding does not go far enough to help vulnerable. It adds that energy bills are set to rise further. DAILY MAIL

Lewisham hospital cuts plan ruled unlawful by judge
Health secretary Jeremy Hunt's plan to reduce A&E and maternity services at Lewisham hospital has been overturned at the high court. Hunt’s proposed changes were part of a wider shakeup of services in the capital after the financial collapse of the neighbouring South London Healthcare NHS trust, which went into administration after it started losing more than £1m a week. The case was won by the Save Lewisham Hospital campaign, a community-based group made up of and supported by patients, community groups, GPs, hospital doctors, nurses and other health professionals. Their law firm, Leigh Day, said "These difficulties were caused by disastrous PFI contracts entered into by South London, which were costing £60m a year to service. The court found Jeremy Hunt had acted outside his powers by trying to make Lewisham pay for the financial problems of its neighbour." GUARDIAN

Sports Direct: 90% of staff on zero-hour contracts
Retail chain's 20,000 part-time workforce do not know how many hours they will work each week and have no holiday or sick pay. Meanwhile 2,000 full-time staff are about to cash in bonuses of up to £100,000. Bosses at Sports Direct, the UK's biggest sports retailer, were this month hailing their bonus policy for full-time staff as that of a model employer. The four biggest supermarkets in Britain, Tesco, Asda, Sainsbury's and Morrisons, said they do not use zero-hour contracts. Other retailers to confirm that they do not employ staff on these terms include Argos, B&Q, Homebase, John Lewis and Marks & Spencer. GUARDIAN

Government attempting to overturn verdict against its employment schemes
In what has come to be known as the Poundland case, the Department for Work and Pensions will argue that the supreme court should overturn the unanimous verdict of three appeal court judges this year that almost all of the coalition government's employment schemes were operating unlawfully. GUARDIAN

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