It's election time! Watch as Cameron cosies up to the NHS

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Why is political advertising exempt from rules on lying?

The Office of Fair Trading (OFT) only considers lying an offense if it fools more than half the target market. 


If OFT rules were applied, all UK elections would be judged completely "fair". 

This is because no political party for decades has won the votes of more than a third of the electorate let alone half. Therefore it cannot be said more than half the target market had been 'fooled'.

Does anyone doubt that politicians lie? Politicians know we know they lie, not least because they themselves work so hard to point out each others' fibs. Labour snitches on the ConDem coalition and the SNP, the Torygraph snitches on Labour. The question isn't why they lie, the question is how they keep a straight face when they are doing it.

After all, they are all honourable (and right honourable) men and women, our MPs in Parliament. We know because they tell us so. So why do they use deceit and dissembling as a key tool in getting their jobs, and getting into power? The answer, of course, is because it works.

Taking a Conservative Party leaflet as an example, our guest author, Barrie Singleton (author of the Spoil Party Games blog), provides an insight below:

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Rip-off News round-up. Our pick of the last week's media (Thu 25th Sept)

Bank of England deputy asks US to fine banks less

The deputy governor of the Bank of England, Andrew Bailey, said: “I am trying to build capital in firms and it’s draining out the other side (in fines and penalties).” Bailey has called for better co-operation with US regulators over the scale of fines being levied on banks to ensure they do not weaken their financial position. Regulators in the US levy largr penalties than their UK counterparts, which on Tuesday fined Barclays £38m for failing to keep its clients’ money separate from the bank’s own assets – a record for that offence. When Barclays was fined £290m for rigging Libor in 2012, just £87.5m was levied by the UK regulator. Since then, HSBC has been fined £1.2bn for breaching money laundering rules in the US while French bank BNP Paribas has been fined £5bn for dealing with countries that were subject to sanctions. GUARDIAN

George Osborne left with little room for pre-election giveaways as government plunges deeper into the red

The Office for National Statistics said the public sector borrowed £11.6billion in August - up 6.1 per cent or £700million compared with the same month last year. It means the government has borrowed £45.4billion in the first five months of the fiscal year - some £2.6billion or 6.2 per cent more than between April and August last year. Analysts warned that the Chancellor will now struggle to hit his target of reducing the annual deficit to £95.5billion this year from around £100billion last year and the record £153billion racked up by Labour in 2009-10. The national debt hit £1.43trillion last month - a staggering £57,000 per household in Britain - despite four years of austerity. The parlous state of the public finances underlines the scale of the task facing whoever is in power after the general election in May. Adam Kirby, director of campaign group Balance the Books, said: ‘Miniscule in the shadow of debt, all our politicians are standing terrified. 'Progress is even slower than the worst pessimists of 2010 might have imagined. And as we approach a new election in 2015 there is little sign of the fundamental reform that’s needed to turn things around permanently - the deficit is still worsening.’ DAILY MAIL

Obama announces US crackdown on corporate inversion tax 'loophole'

“Inversions” involve a US firm merging with a firm in a country with a lower tax rate and have become popular over recent years. But President Barack Obama said new treasury department measures would make inversions less attractive. Those include making it more difficult for an inverted company to access money made outside the US. One way inverted companies do that is by making loans between foreign units and the US business. The benefits of so called hopscotch loans will be removed, according to today's announcement from the US Department of the Treasury. The treasury department is also strengthening the requirement that the US owners of the new inverted firm have to own less than 80% of the new entity. It says that will mean some inversion deals "no longer make economic sense". "We've recently seen a few large corporations announce plans to exploit this loophole, undercutting businesses that act responsibly and leaving the middle class to pay the bill, and I'm glad that [Treasury Secretary Jack Lew] is exploring additional actions to help reverse this trend," the president said in a statement. In a recent inversion deal, Burger King bought Canadian coffee and doughnut chain, Tim Hortons. Under the deal the new group moved its headquarters to Ontario, Canada, where the corporate tax rate is 26.5% - much less than the US rate of 35%. BBC NEWS

New borrowing through personal loans has outstripped repayments every month this year

Such a consistent rise in this type of borrowing has not been seen since 2007, the British Bankers' Association (BBA) said. The monthly data from the BBA shows that there was £175m in net borrowing in personal loans in August and £346m in net borrowing through credit cards. "I was particularly struck that after years of decline, demand for unsecured personal loans is rising quite strongly again," said David Dooks, statistics director at the BBA. "Those products are often used to finance bigger purchases such as cars or major home improvements - the sort of spending we often put off until we feel confident about our financial circumstances… When customers feel more optimistic about the economic outlook they are much more likely to take on new borrowing." However, the reverse is true for overdrafts, with more money (£286m in August ) repaid than taken out. The figures also show that the amount of new mortgage lending was 15% higher than a year earlier in August, with the number of mortgage approvals for house purchases up 5% year-on-year. But the BBA said this activity in the mortgage market was moderating compared with earlier in the year. BBC NEWS

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After the Scottish referendum: Will Westminster renege on its devolution pledges?

Fee and Chris try to guess what happens next...

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Graphs at a glance: Middle-paying jobs have been disappearing for years. Is that why in spite of the economic recovery, wages are still stagnant?

It used to be the case that when unemployment fell wages rose. Bank of England figures show this has been true up to the last recession, but stopped being true since the recovery that started in 2013. According to Ben Broadbent, a deputy governor of the Bank of England, 

“average pay growth [in 2014] is almost 2% points – more than four standard deviations – weaker than the 1993-2012 regression line (Chart 10)."

Statistically “four standard deviations” means this 2% deficit is extremely unlikely to be due to random chance. As James Bond, had his civil service career taken him into the Office of National Statistics, would have put it “four standard deviations is enemy action”.

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Rip-off News round-up. Our pick of the last week's media (Thu 18th Sept)

G4S, Serco: Cancelling “guaranteed profits” probation contracts could cost taxpayers £300m-£400m

Taxpayers will face a £300m-£400m penalty if controversial probation privatisation contracts are cancelled after next May's general election under an "unprecedented" clause that guarantees bidders their expected profits over the 10-year life of the contract. Labour is already committed to unpicking the justice ministry contracts to outsource probation services but will not now be able to do so without incurring the multimillion pound bill because of "poison pill" clauses written in by Chris Grayling's department. The Ministry of Justice say they are only following Treasury guidance by including the clause, which raises the prospect that similar clauses are being included in other politically controversial contracts across Whitehall that are to be signed before next May's general election. Margaret Hodge, the chairman of the Commons public accounts committee, has asked the Whitehall spending watchdog, the National Audit Office, to challenge any politically contentious contracts that are signed in the dying months before the general election: "It is not value for money. It is unacceptable and must be challenged before the event." The disclosure comes as the two outsourcing firms at the centre of serious fraud inquiries, G4S and Serco, confirmed they had been granted new government work during a period when the justice secretary, Chris Grayling, had told MPs that contracts would not be awarded. The confirmation has led to claims that Grayling misled parliament. GUARDIAN

Southeastern handed four-year rail deal despite rating “worst” with passengers

Southeastern has been handed a new four-year deal to run commuter railways in London and Kent, despite having the most dissatisfied passengers of any train operator. The company, run by Govia – a joint venture of Go-Ahead and the SNCF-owned Keolis – was given a direct award without competition to continue services until June 2018. It is the seventh such deal after the West Coast franchising fiasco ripped up the government's timetable for reletting the railways. The Department for Transport said that the operator would be forced to improve services while its subsidy would be cut. But the deal was met with dismay by passenger groups and unions who described it as a "reward for failure". GUARDIAN

Academy schools caught making “questionable” payments to board members

A report commissioned by the cross-party Education Select Committee highlighted potential conflicts of interest where individuals on trust boards could benefit personally or through their companies from their position. One anonymous interviewee told the researchers about an academy “where the headteacher had spent £50,000 on a one-day training course run by their friend” – a decision which was not run past the governors. Another example cited in the report was that Academy Enterprise Trust, which runs 80 schools, has paid nearly £500,000 to private businesses owned by its trustees and executives over the past three years for services ranging from project management to HR consultancy. The report said a range of “questionable practices” by academies were being signed off because existing rules were not strong enough. In another academy, “the chair of governors had told all staff that if they discussed with students or used text books referencing abortion or contraception they would be dismissed”. The researchers’ report said: “The ability of the system to pick up on intangible conflicts that do not involve money seems almost non-existent.”INDEPENDENT

Tories charge £2,500 a head for access to ministers at party conference. Labour and LibDems are doing it too

The Conservatives are charging business executives and lobbyists £2,500 each for access to David Cameron, George Osborne and other ministers at their party conference in Birmingham this year. The paying guests will attend the conference's "business day", which will include lunch with the prime minister and dinner with the chancellor. They will also have a chance to talk to ministers about their specific concerns in "policy break-out" sessions. Companies sending representatives are able to avoid disclosing if they have bought a table because parties are allowed to class the cash as fees received as part of a commercial transaction, rather than a political donation. Political donations of more than £7,500 have to be reported to the Electoral Commission. The Tories are not the only party to sell access to their frontbench. Labour is also marketing a "business forum package" for its conference in Manchester that includes breakfast, lunch and a guaranteed place at its business reception for just under £1,300 a head. It also classifies the cash as a commercial transaction. The Liberal Democrats are selling tickets for their business day at £800 each and for their business dinner at £350. The party's conference website describes the event as "an excellent occasion for business leaders and public affairs executives to meet senior Liberal Democrats and discuss the current issues, challenges and opportunities facing British businesses today". GUARDIAN

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The BBC’s Nick Robinson v Alex Salmond: where will corporation tax be paid? Both are wrong, surely?!

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Graphs at a glance: How policy makers use averages to rip-off half the population

In an earlier post we pointed out that London is sucking the life out of the UK. Were we being fair?

 

It is certainly true that London has a greatly disproportionate share of the UK's economic activity.

One consequence is things in London cost more, from the price of a pint to the price of a house. 

So are people in London paid more than in the rest of the UK so they can afford higher "London Prices"?

Well, yes and no.

On average Londoners are paid more: 15% more than the UK average.  

But take a closer look, and the story is different.

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Rip-off News round-up. Our pick of the last week's media (Thu 11th Sept)

MPs' pay rise of 9% 'should go ahead'

Marcial Boo, chief executive of the Independent Parliamentary Standards Authority (Ipsa), said MPs did an important job and should not be paid a "miserly amount". Their pay will go up from £67,000 to £74,000 under Ipsa's plan. The PM, Nick Clegg and Ed Miliband called the hike unacceptable when it was proposed at the end of last year. The Conservative, Liberal Democrat and Labour party leaders argued it would be wrong when public sector pay rises were capped at 1%. But speaking to the Sunday Telegraph in his first interview since taking on the job, Mr Boo said a review of evidence had shown that economic forecasts were improving while MPs' salaries had "fallen behind" others working in comparable public sector roles. The proposed £74,000 figure was now seen by some as being "at the low end", he claimed, adding that pay needed to be fair to attract good candidates. The one-off increase is part of a package that will see MPs pay more into their pensions, as well as the end of resettlement payments. Ipsa says that overall the reforms will not cost taxpayers any more than the present scheme. BBC NEWS

Bedroom tax bill splits coalition as Lib-Lab pact forces second reading

David Cameron's authority received a damaging blow on Friday when a Liberal Democrat-sponsored bill aimed at modifying the bedroom tax was voted through to the next stage in parliament after dozens of Tory MPs ignored whips' demands to vote with the government. Labour MPs joined with the Tories' coalition partners to send the affordable homes bill, sponsored by Andrew George MP, through to a second reading vote by 306 to 231. Seventy Conservative MPs ignored a three line whip and stayed away from Westminister. Angie Bray, Tory MP for Ealing Central and Acton, voted against her party. Usually, the government can rely on a majority of more than 60. Social housing tenants judged to have too much living space have had their housing benefit cut since 1 April 2013, under a proposal known as the spare room subsidy by the government, but widely known as the bedroom tax. However, a shortage of smaller available homes has meant large numbers have been unable to move to cheaper accommodation yet still suffered the cut. If passed, the new bill would mean people who cannot be found a smaller home would be exempt from the cut in housing benefit. Disabled people who need a spare bedroom or who have had their homes adapted would be exempt. GUARDIAN

House builder Barratt doubles annual profits on back of Help to Buy scheme

The chief executive, Mark Clare, said: "Following the launch of Help to Buy, sales rates over the summer period last year were exceptionally strong. This year we have seen a return to more normal seasonal trends." The mortgage-subsidy scheme has given housebuilders a huge boost since it was introduced in April 2013. Barratt's profits soared to £390.6m in the year to 30 June. The private average selling price climbed 12.9% to £241,600, partly reflecting Barratt's move away from building flats to larger family homes since the downturn. The company completed 14,838 houses – 8.6% more than in the previous year (13,600). The builder expects to construct 15,700 homes in the current year, a slightly slower rate of increase. The Help to Buy scheme accounted for 30% of Barratt's sales last year, and 35% for Redrow, another major housebuilder. Help to Buy, which was due to end in 2016, has been extended to 2020. GUARDIAN

Sports Direct faces action from zero-hours staff over bonus scheme

Sports Direct, the retailer founded by billionaire Mike Ashley, is facing legal action from 250 workers excluded from a multimillion-pound bonus scheme because they were on zero-hours contracts. Lawyers acting for the part-time staff are preparing to file multiple claims for breach of contract at the high court. The employees were excluded from a bonus scheme that paid out about £160m worth of shares to 2,000 "permanent" workers in 2013. The claims, which have been gathered in partnership with workers' rights group Pay Justice, could amount to a £4m-plus bill for Sports Direct. The retailer has been widely criticised for employing nearly 90% of its staff on zero-hours contracts, which do not guarantee a minimum number of working hours a week and also fail to provide for annual leave and sick pay. Elizabeth George of law firm Leigh Day, which will lead the claims, said: "These are the staff whose hard work over many years has brought about the record profits that funded the bonus awards in the first place. It's plainly unfair that they should have missed out... We believe that they had a contractual right to the bonus because regardless of the zero-hours label that the company has given their contracts, they were all permanent employees of the company for the necessary number of years." Many of those taking part in the action continue to be employed by Sports Direct. Pay Justice is encouraging any other staff who believe they might be eligible to make contact via its website. GUARDIAN

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Graphs at a glance: Government increases the percentage of female police officers! By sacking male officers faster than they sack female officers!!

Question: How do you INCREASE the percentage of women in the police force while DECREASING the number of women in the police force?

Answer: You decrease the number of policeMEN faster than you decrease the number of policeWOMEN.

For example, if you have 20 women and 80 men, then 20% are women (20 out of a total 100 people). If you reduce the number of men such that you have 20 women and 20 men the percentage of women goes up to 50% (20 out of 40 people).

The House of Commons Library,  which provides impartial research for MPs, produced their "Social Indicators" report in September 2014. This report shows:

• Total police numbers fell by 15,825 between 2010 and 2014

Of these officer cuts:

• 1,335 were female
• 14,490 were male

As a result the percentage of women officers rose from 26% in 2010 to 28% in 2014. 

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The Scottish independence vote is going to the wire

If Scotland chooses independence, Chris, Fee and KJ wonder who might have to bail out whom...

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Rip-off News round-up. Our pick of the last week's media (Thu 4th Sept)

Gas costs you THREE times what the energy firms pay: Millions of households being ripped off after wholesale cost halves in six months

Wholesale costs have halved in six months yet bills have not fallen. British Gas customers are paying between £1.35 and £1.50 per therm. Its parent company, Centrica, announced profits of £900million for the first six months of the financial year. Yet the wholesale gas price paid by suppliers has hit a four-year low of less than 42p per therm, down from 72p in December. The other Big Six energy companies – nPower, EDF, SSE, E.on and Scottish Power – charge between £1.21 and £1.37 per therm. One therm of gas is enough to power a domestic boiler at full output for almost two hours. British Gas spokesman Tim Cowen said: ‘The wholesale cost of energy is now less than half the bill, which partly explains why the wholesale price can fall, but overall prices don’t... We also have other costs, such as regulated transport and distribution costs, that are rising.' The boss of one of the big six energy companies, nPower, has said Labour’s promise to  freeze energy prices if they win next year’s election is a factor in his company not reducing its prices. But Labour energy spokesman Caroline Flint rejected claims that her party’s pledge is to blame for energy firms keeping bills high. ‘It’s always the same old story – when wholesale prices go up, energy bills go through the roof, but when they fall consumers never see the full benefit,’ she said. The Competition and Markets Authority is holding an inquiry into the energy supply business. DAILY MAIL

Welcome to Copeland in north-west England: the last place where house prices are less than three times the average national salary

According to a study by the Trade Union Congress, back in 1997 one in five local authorities were deemed "easily affordable" with the cost of a home below three times earnings. But the combination of the housing market recovery across the UK and low wage growth since the recession means that areas which were traditionally accessible such as Oldham and Rotherham are now out of reach for many first-time buyers trying to secure a foothold of the property ladder. The value of a home in Oldham, near Manchester, was 2.73 times salary in 1997, but is now up at five times earnings. Rotherham was 2.78 and is now also at five times salary. House prices in Copeland, which lies between the north-west coastline and the Lake District, are 2.87 times the average salary, Barrow-in-Furness is the second most affordable area with Burnley third, the analysis showed. The study also revealed that 84pc of the UK now boast house prices at more than five times the local salary. TELEGRAPH

London and south-east grab the lion’s share of Help to Buy

7,501 buyers in the south-east and 2,837 in London have taken out either an interest-free loan on a new build home or used the mortgage guarantee that allows them to buy a home with only a 5% deposit. The popularity of the scheme in the south-east pushed the north-west into second place, where 6,180 buyers have completed a purchase. More than 48,000 homebuyers have used the scheme since its launch in October 2013. The scheme, it is open to all homebuyers regardless of their income, and can be used on properties costing up to £600,000. The Treasury said the scheme had allowed first-time buyers to access the housing market at a time when mortgage restrictions have locked many of the out. “Out of a total of 48,393 Help to Buy completions to date, 82% have been made by first-time buyers,” it said. The chancellor, George Osborne, added: “Help to Buy is working exactly as we intended. It’s helping first-time buyers on to the housing ladder. It’s a key part of our long-term economic plan, which is supporting hard working people to secure a better future for their families”. Critics of the mortgage guarantee element of Help to Buy warned when it was launched almost year ago that it would push prices in London and the south-east higher unless the government found a way to increase the supply of homes coming up for sale. GUARDIAN

London renters trapped in £1,000 a month 'rabbit hutch properties'

An increasing number of landlords are boosting their returns by splitting family homes into small studio flats, or even smaller living spaces which letting agents have dubbed "semi-studios". Recently buy-to-let specialist firm Platinum Property Partners suggested that an investor buying a £300,000 house could more than treble their returns by converting it and letting to separate tenants rather than a family. Spending £12,000 on converting the home into studios, said the lender, could generate rental income of £37,800 compared with £17,940 they would make from a family let. The result is a growing number of tiny spaces to let, some barely bigger than the recommended minimum. The Housing Act states that a studio flat need only be 110 sq ft – say 11ft by 10ft – to house two adults, while a single tenant can be accommodated in 70 sq ft – a room just 7ft by 10ft. A search of rental websites yielded several examples of rooms where a "mezzanine sleeping area" had been erected - in practice a large shelf, usually little more than a metre from the ceiling, with room for a mattress – making the room large enough to let to a couple. One home in west London, being marketed as a "dynamic studio flat" and available to rent for more than £1,000 a month, has a main living space measuring 9ft 6in by 9ft 3in, or just under 88 sq ft. In another nearby tenants must cook, eat and sleep in a space 10ft by 8.9ft. In 2012/13 London councils estimated that there were 184,878 homes with multiple occupancy (HMOs) in the capital, up by 20,000 on one year previously. Some London councils are acting to clamp down on conversions, with Haringey in north London recently extending rules on houses in multiple occupation to Tottenham to tackle what it described as an abundance of HMOs springing up in response to an increased demand for cheap, privately rented accommodation. GUARDIAN

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Graphs at a Glance: UK has one of the top ten richest regions (the top one) and nine of the ten poorest regions in Northern Europe

Research by the Inequality Briefing organisation reveals how big the gap between rich and poor in the UK has grown. To the extent that the UK has the single richest region  (Inner London) as well as nine of the ten poorest regions in Northern Europe(see the map below).

You can access their briefing paper by clicking here (and the graphic here), in which they state:

"the poorest UK regions are by far the poorest in Northern Europe. This is because the UK is much more unequal than other countries, where there is nowhere as rich as London, but nowhere as poor as our poorest regions."

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