Who Gains From The Games?

If you need a light, the Olympic torch is currently careering round the West Country, if you’d prefer one as a permanent fixture, you can pick up your own on Ebay. The torches are valued at £495, but carriers have the option to purchase for £295, and are free to flog on after use. But best be warned, the bidding is barmy. I could find little available for under four figures, rising to around £145,000 for the bronzed brazier whose current owner is donating 75% of the cash to the charity Whizz Kidz. My advice would be the replica torch as a cupcake decoration for £1.09 plus postage.

All the pomp, and edible.

 That torch bearers have chosen to sell-on their illustrious cargo has angered some, which seems a trifle harsh. They will, after all, be some of the very few to make any money at all from the upcoming Games, so good luck to them.  

 Ok, it would be churlish to assume that an international festival of sport will not attract commercial opportunities and resulting income. However, the outlay is principally from the public purse, which is not where the profits will end up.  Indeed, opportunities have already been missed to generate some home grown earnings. 84% of all the souvenirs sold on the London 2012 website were not manufactured in the UK. Even the eleven million tickets for the Olympics and Paralympics, will not have been printed here. The multi-million pound contract went to an American firm based in Arkansas, and the tickets are being shipped 4,500 miles instead.

 To be fair, the contracts have been awarded to the most competitive bidders, but as the Games is essentially not a commercial entity, why does the bottom line have to be top of the agenda? Money sent abroad will be spent abroad, whereas, home grown contracts, even at a slightly higher price, would mean British wages feeding back into the system. It’s the kind of thing politicians would say, but finance finds famous friends. I did not “back the bid”, but surely if the country is footing the bill, it should benefit economically where possible.

 It’s hard to find exact figures for how much London 2012 is actually costing, but £11 billion seems a pretty reliable working estimate. For figure fans, that’s £11,000,000,000. Now, don’t get me wrong, that would only be an extravagant and senseless waste of resources if, for example, we were labouring under, let’s say, the deepest economic downturn in living memory. Oh, wait a minute…

Greece On A Slippery Slope

Angela Merkel has confirmed her commitment to the continued participation of Greece in the Euro project, but the German chancellor is starting to sound like a landlady whose lodger is behind with the rent, barely employable, and probably pinching her toothpaste. After nine days of trying to form a unity government, the only thing Greek politicians have agreed on, is that they don’t. Into this market-maddening maelstrom flies the newly inaugurated French President, and promptly gets struck by lightning.

 In Francois Hollande’s premier press conference with Mrs Merkel, the early exchanges were more abrupt than embracing. The Chancellor kicked off with the usual non-committal platitudes, concentrating on common ground not contrast. But Monsieur Hollande, maybe with an eye more to the domestic than the diplomatic, was keen to confirm that every option must be “on the table”. His hostess, one sensed, would have preferred that some subjects were brushed politely under it. With a second election looming in Greece, the French President was keen to reach out to its austerity-weary countrymen. “The Greeks need to know we’ll come with growth measures”, he said. The Chancellor, who might prefer that they just shut up and pay up, countered with: “The question is what one means by growth.” Not a full-blooded contradiction perhaps, but a pretty close cousin. If it had been a first date, there might not be a second, but these two don’t have the luxury of simply slating each other to mutual friends and avoiding each other at parties.

 When the Greek electorate go box-ticking again, on June 17th, the anti-austerity parties promise to prosper further. The result may be a battle of brinkmanship. Athens will attempt to alter the agreed austerity arrangements, aware that they may have over-stayed their welcome at a party they gate-crashed under false pretences, but the hosts don’t yet want them to leave. Whether the first socialist President of the Republic in almost two decades can convene sufficient policy compromise to encourage growth remains to be seen. Whether enough economic growth is even practically possible to service debt and still support public services is even less likely. Economists are now tottering towards the once taboo subject of a Greek exit from the single currency. Greece, in the Euro, is increasingly a sinking ship, with a choice between either accepting the bail-out, cuts included, or literally bailing-out.  

French Drive To The Left.

He’s balding, wears glasses, and lacks a supermodel partner, so far, but Francois Hollande has two things that Nicolas Sarkozy might covet, the keys to the Elysee Palace, and a couple more inches in height. The former Mayor of Tulle underwent a mini make-over before his successful presidential campaign, finding a decent tailor, some designer glasses, and shedding some weight. And Hollande’s more streamlined physique could well be useful when walking the tightrope he has now embarked on.

His victory is a lurch to the left, and a protest vote against austerity, the unwanted offspring of the financial crisis, that France reluctantly adopted as an antidote to the debt and deficit. Hollande however, favours the borrow-and-build approach, believing government infrastructure projects will provide work for an unemployed population numbering around 10%. As the freed-up finances filter through the system, it is hoped that workers will start to spend, and so save the state. A simple sell to the waiting workforce perhaps, but Germany’s Chancellor Merkel will not want to rework the hard fought Fiscal Compact, to accommodate these new Gallic grievances. However, is it fair to say that Monsieur Hollande’s demands in that direction weakened palpably as his soaring popularity made presidential success more probable.

The next scheduled meeting of EU leaders is on the 23^rd May, and the President-Elect’s pro-growth agenda may not be without its advocates. After all, Nicolas Sarkozy is the eleventh EU leader to lose his job since 2008, when Lehman Brothers went bang, and the rest of us started whimpering. Austerity is a bitter pill to swallow. If the symptoms we suffer are severe enough we may nod sagely and agree to the prescription, but ultimately when we don’t like the medicine we are likely to request a second opinion.

Back home, even Ed Miliband could not stop folk leaning back to Labour in the local council elections. Maybe if your Plan A is austerity, you had better have a back-up, as being right, in either sense, will be of little consolation when you’re back in opposition. On the other hand, while some are indeed turning to the left, there is no consistent political colour amongst the current victims of the austerity backlash. It may be less about political hue, and more about human nature. We will all acknowledge that we’ve over-spent, and the belt needs to be tightened, but when there’s no bourbon creams left in the tin, perhaps even the best intentioned will just vote for anyone who promises biscuits.    

Performance Related Apple For The Teacher?

That the Education Select Committee’s proposals regarding performance related pay for teachers have been described by the National Union of Teachers as “total nonsense” is not entirely surprising. That they were suggested in the first place sadly isn’t either.   

 
MPs should be aware of the common complaint from business leaders that the annual crop of graduates they are gifted, have grades where their brains should be. And the current tendency to teach to the test, where it exists, at the expense of a thorough grounding in any given subject, could hardly be improved by a system that links a pupil’s exam results, to whether their teacher’s next holiday will be Margate or Mauritius.

The discussed direction is allegedly aimed, on the one hand, at encouraging quality graduates into teaching. If so, it is a depressing deduction to conclude that the only inducement that exists is financial. If you want a sales bonus, sell stuff. What of job satisfaction? What of the vocational calling to impart wisdom and knowledge to the next generation for the general betterment and benefit of the population? Ok, I’m overstepping the marker pen, but if those entering education, or healthcare for that matter, do so under markedly different motivations than the graduates gliding into investment banking, then why plug the same pay structure? And if they don’t, why do we want them to?

 I applaud the idea of rewarding teachers that are “adding the greatest value” to the education of their pupils. However, when your eyes glaze over and you reminisce fondly on forgotten school days, you tend to feel most thankful to the characters that entertained and inspired, not raised your predicted grade average by 22%. They may be the same person, they equally might not.

 A stated aim of the new policy would also be to discourage under performing teachers from continuing in the profession, by preventing them from benefitting from the same advancement as their more successful counterparts. Under ancient practices, staff would automatically progress up the pay-scale, but this process was doctored under the last government towards a points based system which is already performance determined.

 Having your tonsils out does not make you a healthcare expert, and though most of us have been to school, few would think we could run one, let alone all of them. The government is right to seek to safeguard and improve the quality of public services, but there are lessons from the Health and Social Care Bill that have clearly not been learnt. Rewarding a decent nurse or teacher with fair pay, and the freedom to do their job without the threat of constant upheaval from the rolling whims of successive governments should not feel like radical thinking, but it’s starting to.  

Rupert Remembers, Jeremy's Hunted

Until yesterday Adam Smith was a ministerial special advisor, although clearly not quite special enough. When writing his resignation letter, we can but wonder whether his free arm was being twisted. His rapid removal follows revelations at the Leveson Inquiry, suggesting information flowed between News Corp and the Department for Culture, Media and Sport, deemed inappropriate given the company’s campaign for complete control of BSkyB. Labour still have the scent of blood, so if Mr Smith was merely the Culture Secretary’s sacrificial lamb of choice, Jeremy still has every reason to feel hunted.

Ed Miliband has publicly called for Mr Hunt to hop it. “He should resign”, said the Labour leader, “he himself said that his duty was to be transparent, impartial and fair.” The Financial Times report that Jeremy Hunt previously referred to himself as a “cheerleader” for Mr Murdoch’s achievements, on his own website. If so, you can see right through his claims of transparency, and impartiality seems implausible, at best.

It may be that the Culture Secretary’s admiration for the media mogul will pay dividends, however. The headlines which might otherwise have been plotting his demise, are instead reporting the appearance at the Leveson Inquiry of Mr Murdoch himself. When executives from The News of the World appeared before a cross-party select committee in the wake of the phone-hacking scandal, they were accused of collective amnesia. It would seem this unhelpful condition may have been contracted from their boss. Although advanced in years, Mr Murdoch shows no apparent signs of senility, yet has forgotten all manner of details, from conversations with his son, to dinners with Prime Ministers. You would have hoped that at least one of those might have been mildly memorable.

Like all good theatre, an inquiry like this will entertain, and provoke discussion, but in and of itself will rarely change the status quo on which it offers comment. Politics, the press, and indeed the police, are essentially self regulating bodies, and the resulting inquiries from their varied alleged inequities feel like a war of attrition. The length and tedium of the investigation will be directly proportionate to the level of public outrage, and we always give up first. Self regulation is like me asking my three year old to put himself on the naughty step, every time he attacks the cat. It’s a very democratic idea, and as such I would welcome it, but I live in a house with a very nervous cat.              

Grand Prix At Too Great A Price?

Thousands have taken to the streets of Bahrain, as the country plays host to this weekend’s Formula One Grand Prix. Although many have called for its cancellation, it is not so much the race itself to which they object, but the Sunni government that granted the permit. Representing a minority in numbers, they hold the majority of the power, status, and wealth, all of which would be cemented, if not enhanced, by a successful staging of what would be the country’s premier sporting event. Small wonder therefore, that the Crown Prince of Bahrain, Salman bin Hamad Al Khalifa, and Bernie Ecclestone, the crown prince of petrol-heads, have came out in a unified display of commitment to the race, albeit with differing justifications.

Against a backdrop of rising civil unrest, which has seen members of the Force India team ask to go home after they were caught up in the disturbances, the Crown Prince said; “I believe this race is a force for good, it unites many people from many different religious backgrounds.” His comments mark a stark contrast to those of Bahrain’s senior Shia cleric who condemned the crackdown that has accompanied the Grand Prix. The “force for good” will sadly not be witnessed by the many international journalists denied entry to the country to report on the growing tensions.

“It is nothing to do with us what happens in the country,” was the hi-light of Bernie Ecclestone’s amoral musings. The F1 Chief Executive was also quoted as saying it was not “in his power” to call it off. In reality such impotence is likely to be purely self-imposed, as anti-government protests led to last year’s race being cancelled. Alleged human rights abuses continue, according to the banned Bahrain Freedom Movement, claims supported by Amnesty International. Indeed, the Grand Prix itself is likely to coincide with the funeral of a protester allegedly beaten to death by security forces.

Paradoxically, it is the very Grand Prix to which so many of the protesters are opposed, that has proven their unlikely ally. The eyes of the world are again on Bahrain, bringing an international spotlight to internal calls for social and political reform, while attempts to stifle media coverage serve only to sharpen its focus. The Guardian reported a survey carried out for the Bahrain Economic Development Board, which found that 77% of those questioned actually welcomed the Grand Prix. To the governing elite it brings wealth and prestige, to those striving for reform it brings a platform for protest, and to the rest of us the question; if we know the hand signing the cheque has blood on it, should we really be taking the money?

Sincerely "Shocked" of Westminster

 The Chancellor of the Exchequer was apparently “shocked” to learn that many of the UK’s top tier earners pay next to no income tax, but following the findings of an HM Revenue and Customs investigation, George Osborne has been persuaded of the need to “take action”. I have been convinced for years of the need to floss regularly, yet strangely lack the motivation to follow through on my good intentions. Now, whilst it would be churlish to align the deficiencies of my dental hygiene routine with the likelihood of the Chancellor slamming shut a few lascivious loopholes, it might be fair to ask Mr Osborne to quantify the scale of his “shock”. Personally, if some mischief I’d suspected turned out worse than was predicted, I would describe myself more as disappointed, dismayed even. But if I was “shocked” you might conclude that I was either in the wrong job, or lying.

 However, that is me, and I am not the Chancellor. Instead, still no doubt reeling from the “shock”, our gallant hero rides into battle against the malevolent miscreants defrauding the crown of their rightful coppers. But who, I hear you cry, are these merry millionaires? Is it the bankers, the pantomime villain of choice for the muttering many? Or the “non-dom” donors, propping up their parties with one hand on the tiller of a gin palace in San Tropez? Why no! Saint George rides out under the banner of budgetary balancing against pensioners and the charity sector.    

Capping tax relief for charitable donations does not so much fly in the face of the principles behind Big Dave’s Big Society, it’s more of a slap, and the great and the good are queuing up to say so. Certainly, allowing higher rate taxpayers to plough unlimited funding into charitable causes, offsetting the amounts against their tax bills to reduce their payments, does indeed reduce income to the Treasury. However, of all the tax avoidance schemes to choke off, it is one of the few that benefits the country, often guaranteeing the survival of organisations that rely upon donations to maintain the work they do in the community. It seems symptomatic of the frankly bizarre PR deathwish that also saw the 50p tax rate reduced, in a perceived tax cut for millionaires, while pensioners suffered with the abolition of age-related income allowances. Far from slaying dragons, George has become one of his own making. And you don’t have to be a blood hound to catch the scent of u-turn trickling from the Treasury. They are damned if they do of course, and damned if they don’t. But given a choice between being wrong and reforming, or just wrong and resolute, I vote firmly for the former.

The distinction between tax avoidance and evasion, is that one puts you in Parkhurst, the other in Monte Carlo. As the Chancellor points out, there are perfectly legal methods of managing your millions to keep your mitts on most of it, from pension fund over-payments to use of tax havens, or avoiding stamp duty and inheritance tax. The government estimate the annual cost to the treasury is in the region of £5 billion. The real figure is likely to be four times that, or more. To really limit the losses needs legislation, and who better to bring it in that the man who avoided capital gains tax by “flipping” the house he assigned as his second home? The Chancellor may have shot himself firmly in the foot with his first barrage in the battle against tax avoidance, but he may yet win the war, if he really wants to. And if he does, I for one will be “shocked”.