The last post got me thinking about housing again - and particularly about local government and housing. Two things bother me about council housing policies and council tax rates.
First of all, the ridiculous idea that people who under use the home they have are given a discount from their rates for doing so. I don't see why they should be - yes, I know that, in theory, they are less drain on resources, but by keeping that house underused they are also preventing someone else from contributing to the local economy. At best that balances out - at worst, and more likely, it costs the local economy money.
The second thing that bothers me is the way housing is allocated. I know the BNP claim that there are actual policies to house immigrants and ethnic minorities ahead of the indigenous population in some areas. I'm not sure that is the actual policy, but what is - usually - true is that the housing is allocated on "need" rather than entitlement.
I don't subscribe to the belief that ethnic minorities are more "needy" than indigenous people nor do I agree that just because an immigrant chose to make themselves homeless and jobless and come here gives them a greater "need" than someone who has lived here all their life and is homeless and jobless through no fault of their own - but, apparently, local authorities do.
So to redress these issues here is my plan for a better housing policy.
The Stan Plan for council tax and housing priority
Before I go into the actual policy I should point out that I saw nothing wrong with the old Maggie style Community Charge - the poll tax. It was relatively simple and fair - you live in a community so you pay for the services that community provides.
I still don't see why a 30 year old living at home with mum and dad, earning £30,000 a year, driving around in a £20,000 car and taking two or three holidays a year (yes, I know people like this) should be exempt from paying for local services, but there you go.
I don't agree with local income tax because I don't see why someone should pay more for a service just because they earn more. The Community Charge was fair and equitable - bring it back, I say!
Anyway - on to the policy. As I said before, I think it is stupid to reward people for keeping homes empty or underused. Yes, they possibly use less services (debatable as they still get their bins emptied, street cleaned and streetlights maintained - but I won't go into that now).
I'm not sure what the rebate is (25%?), but it is plain daft to me. Instead I propose a sliding scale of charges depending on the number of bedrooms that home is designed for. I say "designed for" to ensure that someone can not get around the charge by converting their 3 bed house into a one bedroom house.
Sliding Scale for Council Tax
1 bed house/flat with 1 occupant - 100% charge (i.e. - no rebate, but no additional charge either)
2 bed house with 1 occupant - 125% charge
3 bed house with 1 occupant - 150% charge
4 bed house with 1-2 occupants - 175% charge
5 bed house with 1-3 occupants - 200% charge
Note: an occupant needs to be registered to that address - so if a couple has a 4 bed house but two kids at uni they won't pay the additional charge.
There will also be reduced charges for larger families living in smaller homes.
1 bed house with 2 or more occupants - 25% discount.
2 bed house with 4 or more occupants - 25% discount
3 bed house with 5 or more occupants - 25% discount
You get the picture. Incidentally - I personally would get no benefit from this as I have a 3 bed house with 4 occupants. So I'd pay the same as I do now - the idea is to encourage people to make better use of their homes and, also, to encourage people to have larger families. The other benefit is that people whose homes are becoming too small for their family could possibly benefit from reduced costs allowing them to save for a larger more suitable home.
Housing priority
The following table lists the priority for council housing. Each successive priority surpasses the previous so someone on priority 3 is more entitled to a council house than someone on priority 2.
1 Length of time you have lived in Britain
2 Length of time you have lived in the local authority area.
3 Length of time you have lived in the town/village/city
4 You were born in Britain
5 You were born in the local authority area
6 You were born in the town/village/city
7 Your parents were born in Britain
8 Your parents were born in the local authority area
9 Your parents were born in the town/village/city
10 Your grandparents were born in Britain
11 Your grandparents were born in the local authority area
12 Your grandparents were born in the town/village/area
..... and so on.
By that measure we can ensure that local people who can demonstrate a generational attachment to the local region are given priority for housing.
Seems fair to me.
Showing posts with label The Stan Plan. Show all posts
Showing posts with label The Stan Plan. Show all posts
Friday, August 29, 2008
Monday, July 21, 2008
Look after the pennies
At long last someone at the Telegraph is starting to "get it".
When a country, like a household, is in financial difficulties, it has two options: to increase income or cut spending.
Essentially, that is all managing the economy is about - balancing your spending against your income. Despite all the complicated talk and waffle about "fiscal policies" and what have you, managing an economy is not rocket science. Dickens sums it up nicely in David Copperfield.
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness.
Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
Every housewife and homeowner understands this. They also understand that when spending threatens to overtake income you have to reduce your spending - and that means cutting back on things that can no longer be afforded. It's simple - we all do it.
Taking out a loan to cover the gap might seem like an attractive option at first, but - again - we all know that ultimately that will come back to bite us if that spending is still not curtailed. Johnston makes this point very clear in his article before pointing out some areas where public money is apparently being squandered.
We have come to a pretty pass where a loss of £1.5 billion and the admonishment of the public auditor can be virtually shrugged off. Have we become so inured to waste on such a colossal scale that we no longer care?
Then the revelation hits him.
Or are the numbers too big for us to grasp?
Yep - that's it old fruit. The truth is that government finance now encompasses figures so huge they are utterly incomprehensible to people. Our minds just can't contemplate those sorts of sums of money.
In a nation that has over a trillion pounds of personal debt and where some £130 billion pounds are spent on quangos, sums of a few million or even one or two billion become trivial.
This is why I believe it is desirable - even necessary - to revalue our currency by a factor of 10 so that £10 becomes £1 as it brings the concept of "value" back into focus.
Imagine you win £10 million on the lottery. You want to buy a nice yacht so splash out £2 million on something special. You still have £8 million left over so everything seems good.
But if that £10 million was just £1 million and the yacht cost £200,000 - your remaining money is now just £800,000. Exactly the same proportionally, but it brings the value of the yacht into perspective. Suddenly the idea of spending a fifth of your winnings on a yacht doesn't seem such a good idea.
This is how our minds work. When the sums of money become so large that even enormous sums of money seem trivial then the result is excessive spending and waste. The value of money becomes lost in the huge sums. When it comes to the concept of "value" those sums don't even have to be that great.
If you drop 50p down the drain you might be annoyed about it briefly, but so what? You've still got £10 in your pocket so losing 50p might be annoying, but it's no big deal.
That's how it is with government spending. If you lose a billion here or there, who cares? There are another 600 billion in the coffers so it's not a lot to lose.
We all do it. The bigger the sums of money the more we waste.
Go back to that example of the 50p down the drain again. Suppose it was 5p and all you had was £1 in your pocket. Suddenly, losing 5p down the drain IS a big deal. Now you realise that every penny counts.
Now you understand the value of money.
When a country, like a household, is in financial difficulties, it has two options: to increase income or cut spending.
Essentially, that is all managing the economy is about - balancing your spending against your income. Despite all the complicated talk and waffle about "fiscal policies" and what have you, managing an economy is not rocket science. Dickens sums it up nicely in David Copperfield.
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness.
Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
Every housewife and homeowner understands this. They also understand that when spending threatens to overtake income you have to reduce your spending - and that means cutting back on things that can no longer be afforded. It's simple - we all do it.
Taking out a loan to cover the gap might seem like an attractive option at first, but - again - we all know that ultimately that will come back to bite us if that spending is still not curtailed. Johnston makes this point very clear in his article before pointing out some areas where public money is apparently being squandered.
We have come to a pretty pass where a loss of £1.5 billion and the admonishment of the public auditor can be virtually shrugged off. Have we become so inured to waste on such a colossal scale that we no longer care?
Then the revelation hits him.
Or are the numbers too big for us to grasp?
Yep - that's it old fruit. The truth is that government finance now encompasses figures so huge they are utterly incomprehensible to people. Our minds just can't contemplate those sorts of sums of money.
In a nation that has over a trillion pounds of personal debt and where some £130 billion pounds are spent on quangos, sums of a few million or even one or two billion become trivial.
This is why I believe it is desirable - even necessary - to revalue our currency by a factor of 10 so that £10 becomes £1 as it brings the concept of "value" back into focus.
Imagine you win £10 million on the lottery. You want to buy a nice yacht so splash out £2 million on something special. You still have £8 million left over so everything seems good.
But if that £10 million was just £1 million and the yacht cost £200,000 - your remaining money is now just £800,000. Exactly the same proportionally, but it brings the value of the yacht into perspective. Suddenly the idea of spending a fifth of your winnings on a yacht doesn't seem such a good idea.
This is how our minds work. When the sums of money become so large that even enormous sums of money seem trivial then the result is excessive spending and waste. The value of money becomes lost in the huge sums. When it comes to the concept of "value" those sums don't even have to be that great.
If you drop 50p down the drain you might be annoyed about it briefly, but so what? You've still got £10 in your pocket so losing 50p might be annoying, but it's no big deal.
That's how it is with government spending. If you lose a billion here or there, who cares? There are another 600 billion in the coffers so it's not a lot to lose.
We all do it. The bigger the sums of money the more we waste.
Go back to that example of the 50p down the drain again. Suppose it was 5p and all you had was £1 in your pocket. Suddenly, losing 5p down the drain IS a big deal. Now you realise that every penny counts.
Now you understand the value of money.
Monday, June 16, 2008
The Stan Plan: The value of money
I don't know about you, but usually when I get petrol for my car I would normally fill the tank up. Recently, though, I haven't been doing this. One reason is that I don't pay with my debit card any more but use cash - this is due to the number of people I know who have had their cards skimmed at petrol stations - so to avoid getting skimmed myself I just put £30 worth in and pay with real money.
It's actually a great way of doing things. It takes half the time that it does to use a debit card and I also tend not to buy numerous other things which I don't really need - mints, sweets, chocolates, drinks and so on. I just hand over my £30 and off I go.
Or rather, I hand over my £30 and one penny. Have you noticed how hard it is to stop a petrol pump on an exact price? The numbers click over so quickly that the gentlest squeeze on the trigger sends 3 or 4 pence worth of petrol into the tank. It's infuriating to say the least, but it also made me think about money and it's value. So I've decided to put together a post on it - it's the first post in a series of posts on what I call "The Stan Plan". Think of it as a personal manifesto.
Mostly this is just a bit of fun for me - a chance to exercise my megalomania and delusions of grandeur - but it's no laughing matter that it now costs around £70 to fill my car with petrol. It's not a big car either - just a bog standard family saloon. It's not that I can't afford it either. I don't actually do a lot of driving so a full tank will last a month or more, but for someone like me who was brought up in a very working class family where every penny was crucial the blase way we approach money these days is still somewhat shocking.
I'm sure there are many reasons for that - the easy access to credit being one of them - but I believe the main reason today is that we have lost all notion of the value of our money and that this is due mainly to the fact that inflation over the years has meant that the sums of money we deal with on a daily basis are so large that the real value has been lost.
Think of it like this. If your monthly income is £2000 then what does £70 to fill your tank matter? In real terms it probably isn't that different from 30 years ago when your monthly income may have been £200, but it still cost £7 to fill your car up. The difference is that it feels very different to have £1930 left over than it does to have £193 to see you through the month.
So my idea is to revalue the pound by a factor of 10 - so that £10 becomes £1.
Nothing really changes - your money post revaluation would go as far as it did pre-revaluation (though there may be some small adjustments up and down on certain things), but what it will do is give most people (apart from the very rich) a better appreciation of the value of things.
Let's look at some examples.
Someone earning £30,000 a year would earn £3,000 a year post-revaluation
A house costing £250,000 would cost £25,000.
A car costing £15,000 would cost £1,500.
A council tax bill of £1300 would be reduced to £130.
A mortgage payment of £800 a month would be £80 a month.
A washing machine costing £250 would cost £25.
A bicycle costing £100 would cost £10.
A DVD costing £15 would cost £1.50.
A packet of 20 cigarettes costing £5.50 would cost 55p.
A gallon of petrol costing £4.40 would cost 44p.
A pint of beer costing £2.75 would cost 27.5p.
Instead of your pound buying $1.97 it would buy $19.70.
With me so far?
There will be somethings that might go up in price. For example if something currently costs 28p to buy then it can not cost 2.8p post-revaluation - so it will become 3p. However, this will be balanced by adjusting to the nearest half penny. So if something costs 27p now it will go down to 2.5p post-revaluation.
What is the point of all this?
The first point is that it gives people a much better understanding of the value of the pound in their pocket. As I said earlier, when you have £2000 a month it seems like £70 is a relatively minor amount, but when that becomes £7 out of £200 it suddenly seems a lot more significant.
There are also environmental benefits. Our modern society likes to think we are more environmentally enlightened than previous generations - and in some respects we are - but the reality is that we've become a nation of throwaway junkies. Tumble dryer not working? No worries - a new one only costs £150 and that's not a lot in this day and age. But hang on - if that tumble dryer is now £15 and you only have a monthly income of £200 it suddenly seems like an awful lot of money. Better to spend a fiver getting it fixed.
So it would mean less propensity to just throw things away - and that is better for the environment.
It would also bring back the culture of saving. Back in the seventies, if you wanted something you saved up for it. It didn't matter if you were a kid saving up for a new Airfix kit or a dad saving up for a new car, you saved your money till you could afford to buy it outright or put a significant deposit on it.
But with things costing what they do now it is a lot harder to visualise that. That is especially true with big purchases and houses in particular. If you are a young couple looking to buy your first home then the prospect of saving up £12,000 for a 10% deposit on a £120,000 flat seems impossible - but if that became a deposit of £1,200 then that seems a lot more achievable through saving even though, in reality, there is no difference.
It would also loosen our dependency on credit. Saving up £80 to buy a top of the range television sounds relatively easy, but at £800 there is much more likelihood to resort to credit to buy it.
It would mean some other changes to. It would certainly make sense to reintroduce the pound note again. It would also mean a return of the hapenny (that's a half penny coin to anyone under 40 years of age).
Personally, I'd go further and bring back the shilling. Not the point of having 20 shillings to the pound, but why not 10 shillings to the pound and 10 pence to the shilling? You'd still have 100 pence equalling one pound, but it would give us back a piece of British culture which we are poorer as a nation for having given up.
As far as I can see there are a lot of benefits to revaluing our currency. It would be better for the environment by reducing the disposable society, encourage saving and discourage the tendency to resort to credit. In real terms, nothing would actually change value wise, but there would be a far better understanding of what value is and, particularly, what the value of the pound in your pocket is.
And I'd be able to put a few quids worth of petrol in my tank without having to fish for a penny or split a fiver.
Think about it. A Britain where you'll still get change from a pound when you buy a pint and a packet of crisps. A Britain where you can fill your car up for under a tenner. A Britain where the average cost of a house no longer sounds like the national debt of a small nation.
Downsides? I can't think of any - how about you?
It's actually a great way of doing things. It takes half the time that it does to use a debit card and I also tend not to buy numerous other things which I don't really need - mints, sweets, chocolates, drinks and so on. I just hand over my £30 and off I go.
Or rather, I hand over my £30 and one penny. Have you noticed how hard it is to stop a petrol pump on an exact price? The numbers click over so quickly that the gentlest squeeze on the trigger sends 3 or 4 pence worth of petrol into the tank. It's infuriating to say the least, but it also made me think about money and it's value. So I've decided to put together a post on it - it's the first post in a series of posts on what I call "The Stan Plan". Think of it as a personal manifesto.
Mostly this is just a bit of fun for me - a chance to exercise my megalomania and delusions of grandeur - but it's no laughing matter that it now costs around £70 to fill my car with petrol. It's not a big car either - just a bog standard family saloon. It's not that I can't afford it either. I don't actually do a lot of driving so a full tank will last a month or more, but for someone like me who was brought up in a very working class family where every penny was crucial the blase way we approach money these days is still somewhat shocking.
I'm sure there are many reasons for that - the easy access to credit being one of them - but I believe the main reason today is that we have lost all notion of the value of our money and that this is due mainly to the fact that inflation over the years has meant that the sums of money we deal with on a daily basis are so large that the real value has been lost.
Think of it like this. If your monthly income is £2000 then what does £70 to fill your tank matter? In real terms it probably isn't that different from 30 years ago when your monthly income may have been £200, but it still cost £7 to fill your car up. The difference is that it feels very different to have £1930 left over than it does to have £193 to see you through the month.
So my idea is to revalue the pound by a factor of 10 - so that £10 becomes £1.
Nothing really changes - your money post revaluation would go as far as it did pre-revaluation (though there may be some small adjustments up and down on certain things), but what it will do is give most people (apart from the very rich) a better appreciation of the value of things.
Let's look at some examples.
Someone earning £30,000 a year would earn £3,000 a year post-revaluation
A house costing £250,000 would cost £25,000.
A car costing £15,000 would cost £1,500.
A council tax bill of £1300 would be reduced to £130.
A mortgage payment of £800 a month would be £80 a month.
A washing machine costing £250 would cost £25.
A bicycle costing £100 would cost £10.
A DVD costing £15 would cost £1.50.
A packet of 20 cigarettes costing £5.50 would cost 55p.
A gallon of petrol costing £4.40 would cost 44p.
A pint of beer costing £2.75 would cost 27.5p.
Instead of your pound buying $1.97 it would buy $19.70.
With me so far?
There will be somethings that might go up in price. For example if something currently costs 28p to buy then it can not cost 2.8p post-revaluation - so it will become 3p. However, this will be balanced by adjusting to the nearest half penny. So if something costs 27p now it will go down to 2.5p post-revaluation.
What is the point of all this?
The first point is that it gives people a much better understanding of the value of the pound in their pocket. As I said earlier, when you have £2000 a month it seems like £70 is a relatively minor amount, but when that becomes £7 out of £200 it suddenly seems a lot more significant.
There are also environmental benefits. Our modern society likes to think we are more environmentally enlightened than previous generations - and in some respects we are - but the reality is that we've become a nation of throwaway junkies. Tumble dryer not working? No worries - a new one only costs £150 and that's not a lot in this day and age. But hang on - if that tumble dryer is now £15 and you only have a monthly income of £200 it suddenly seems like an awful lot of money. Better to spend a fiver getting it fixed.
So it would mean less propensity to just throw things away - and that is better for the environment.
It would also bring back the culture of saving. Back in the seventies, if you wanted something you saved up for it. It didn't matter if you were a kid saving up for a new Airfix kit or a dad saving up for a new car, you saved your money till you could afford to buy it outright or put a significant deposit on it.
But with things costing what they do now it is a lot harder to visualise that. That is especially true with big purchases and houses in particular. If you are a young couple looking to buy your first home then the prospect of saving up £12,000 for a 10% deposit on a £120,000 flat seems impossible - but if that became a deposit of £1,200 then that seems a lot more achievable through saving even though, in reality, there is no difference.
It would also loosen our dependency on credit. Saving up £80 to buy a top of the range television sounds relatively easy, but at £800 there is much more likelihood to resort to credit to buy it.
It would mean some other changes to. It would certainly make sense to reintroduce the pound note again. It would also mean a return of the hapenny (that's a half penny coin to anyone under 40 years of age).
Personally, I'd go further and bring back the shilling. Not the point of having 20 shillings to the pound, but why not 10 shillings to the pound and 10 pence to the shilling? You'd still have 100 pence equalling one pound, but it would give us back a piece of British culture which we are poorer as a nation for having given up.
As far as I can see there are a lot of benefits to revaluing our currency. It would be better for the environment by reducing the disposable society, encourage saving and discourage the tendency to resort to credit. In real terms, nothing would actually change value wise, but there would be a far better understanding of what value is and, particularly, what the value of the pound in your pocket is.
And I'd be able to put a few quids worth of petrol in my tank without having to fish for a penny or split a fiver.
Think about it. A Britain where you'll still get change from a pound when you buy a pint and a packet of crisps. A Britain where you can fill your car up for under a tenner. A Britain where the average cost of a house no longer sounds like the national debt of a small nation.
Downsides? I can't think of any - how about you?
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