UK Economy
Inflation
has risen to 5.2% with headline inflation which includes housing
cost has risen to 5.6%. The headline inflation gives a more
accurate figure of what people are experiencing. Growth has
all but disappeared at 0.1%, however the indication are that
by the end of the year growth at the best will be zero, and
most probably it will be negative growth.
Mervyn
King , head of the Bank of England was asked by the treasury
committee if the latest increase of £75b in Quantitative
Easing would result in the banks lending to small and medium
sized businesses, the backbone of the UK economy, he said
he didn’t expect this to happen. When asked why he didn’t
put a stipulation on this round of Quantitative Easing that
the banks should lend more, he said that was the job of the
treasury and the government to offer incentives. [Banks have
been ordered by the government to build up their reserves
against future losses] The government unlike European governments
are not going to support our banks with tax payers money.
Tory
Revolt
David Cameron suffered a large rebellion on the countries
100,000 signature request for a referendum on Europe. Despite
a three line whip, and threats of sackings 81 Conservatives
voted against their leader, and 3 parliamentary aides resigned
in order to vote against Cameron, and not be sacked. During
the debate Cameron appeared to promise the rebels that he
would work to rest some of the power from Brussels over UK
laws. When asked about it at Prime Ministers Question, he
twice refused to answer the question of when and what he was
going to do. Nick Clegg and Vince Cable on the other hand
said they would not allow any return of power from Brussels
while they were in power. David Cameron also refused to answer
Ed Milliband’s question on who was running the coalition,
him or Nick Clegg.
The
EU
The EU are struggling to find an answer to the EU crisis which
is now affecting the world recovery, and in effect could put
the world back into recession if they get it wrong. Greece
is expecting to have 50% of the bail out money they have already
received written off, and a much larger loan given for it
to survive, with possibly more to follow.
The European banks are being asked to write down the Greece
loan by 50%, while at the same time being asked to lend more
money to Greece.The Euro banks are being strengthened by around
one trillion Euros. Italy is expected to need more money than
any other country, their parliament have been dragging their
feet and have had difficulty agreeing austerity measures.
Spain and Portugal are also expected to need bail out funds.
France is worried about the possibility of loosing it’s
triple ‘A’ credit rating.
The
NHS
The House of Lords are still debating the NHS bill. Their
biggest problem is that there will be no-one in overall control.
This has traditionally been the Minister of Health; the government
don’t want to be seen as being in charge of demolitioning
the NHS, which is why they won’t let a minister be in
charge. The changes the government are forcing on the NHS,
will not be monitored, another reason why the Lords won’t
pass the bill. The government want the patients to be in control,
although it will be selected doctor’s practices which
will run the NHS. Most practices over the years have built
up lucrative associated businesses, first it was their investment
in private care homes, after which they set up private clinics.
The fear is that they stop referring patients to the NHS for
routine operations, but will recommend their own private clinics.
The government are encouraging private initative in the NHS,
but will not supervise, or monitor these. Without direction,
supervision and a minister in charge, as patients are manipulated
into using private resources; obviously the government will
reduce investment in the NHS, which will then disintegrate
through no fault of the millionaire’s coalition. Possible
in two years time, an organisation as big as the NHS without
an overall head, no supervision or controls, could have deteriorated
to the extend that the government will have to sell it off
piecemeal to save it.
Housing
Housing is still a big problem, with not enough houses being
built to accommodate the immigrants, and the increasing population.
Parliament is due to debate a bill to amend the Housing Benefit
rules. Any body claiming housing benefit, living in a house
with one unoccupied bedroom will lose £11 per week from
their HB. The coalition is looking at other alternatives of
freeing up housing stock. Pensioners, the coalition’s
favourite target, will be made to sell their large family
homes they have lived in for years and by a smaller home away
from their friends and family, and it will stop family and
carers stopping overnight. Other suggestions are that several
generations should live in the same house, I think that’s
what other governments have called overcrowding. A millionaire
couple living in a , 5, 10 ,or 20 bedroomed house will not
have to sell their homes. However they has been suggestions
that single millionaires living in large mansions, should
not be allowed to claim the 25% reduction on their poll tax
bill because they are the only occupant. MPs with a second
home in the capital funded by the tax payer, will still be
able to buy a 2 or 3 bedroomed house/flat with no restrictions.[more
bedrooms means more profit when they sell]
Other ideas that have been put forward by an influential think
tank. You can download
their report here.
News
Corp
Meanwhile on the other side of the pond in the U.S., News
corporation investors voted 2 to 1 not to re-elect the current
board members, in particular James and Lachan Murdoch. Almost
35% of investors voted against James, and 34% voted against
his brother Lachlan. Surprisingly only 14% voted against the
chairman Rupert Murdoch.
When you consider that the Murdoch family have 40% of the
votes, and the Saudi Prince Alwaleed Bin Talal holds 7%, that
only leaves 53% to vote freely, who voted 2 to 1 for a change
of board and better governance. The Murdoch family with their
47% share were re-elected.
There is a chance that as Libya gets back on its feet and
starts producing oil again, the price of fuel at the pumps
could come down, unless the government decides to increase
duty. I don’t know why I wrote that last sentence, we
all know fuel won’t come down.
