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Councils in England in crisis as Birmingham ‘declares itself bankrupt’
- nonrandomstring 3y agoOur own local council in the South of England, BCP is in the doghouse too. We have extraordinary inequality of taxation at the root of it. We have some of the wealthiest areas in Europe, like Sandbanks where every house is a mansion with it's own private beach, but we still cant fill the potholes in roads in the poorest areas. So sad that they lack the courage to put basic policies in order.
- benjaminwootton 3y agoThe roads in many areas of England that I visit are like those found in war zones.
- gumballindie 3y agoGuaranteed the only way they’ll think will solve the issue is higher taxes. The uk has run out of ideas and the only option seems to be taking people’s money away.
- drcongo 3y agoI'm guessing you're not UK based?
- gumballindie 3y agoI am, and taxation is atrocious.
- mk89 3y agoAre taxes high and services/schools/hospitals so bad you need to pay privately?
- gumballindie 3y agoThe NHS (public healthcare), is unusable. They are taking the piss, having two hour lunch breaks at surgeries, pushing everyone towards main hospitals which are overcrowded. Schools are a gamble, it’s called the post code lottery - the masses obviously say the “rich” are sending kids private, but anyone who wants decent schooling goes private. Increased small business taxes, increased software contractor regulation, are literally killing the industry. Cities are going bankrupt due to mismanagement yet folks keep demanding tax hikes as if that’s going to fix the fundamental issues of this country. I’ve never seen the UK in such a bad state. Potholes everywhere while the government is yet to be held accountable for misspending money.
- mk89 3y agoI am a bit surprised to read this about the UK. Is this everywhere or just in some regions? Anyway, the issue is not the taxation but the misuse, then?
- gumballindie 3y agoTax hikes coupled with higher interest rates and an increased cost of living are making a dent. For software developer, contractors in particular - the only way to reach something that somewhat resembles US pay - are now subject to tightened regulation called IR35. Contracts "inside" IR53 are taxed just like regular pay even if done via an LTD and you can't claim expenses. This regulation is meant to catch disguised employees, but large clients don't want to risk it. In reality what's happening is that contract work is sent to outsourcing companies, one of which is the prime minister's wife's father Infosys. And that's one example. Outside tech there are all sorts of "traps": people's wages are increasing only to be caught up in higher tax brackets essentially meaning their pay is still low. Factoring in what I wrote about taxes, col, and interest raters, everyone is much poorer now than before. A lot of low income earners are squeaking about further tax hikes as if that's going to improve their lifes somehow. It's a crab mentality. In regards to regions, it naturally varies, but overall the situation is the same everywhere. For instance, the second largest city just went bankrupt and I suppose those people are in for a ride. The region where I live, despite being the type that pays the tax so many yearn for, roads are filled with potholes, and the local surgery constantly complains about how much work they need to do. Friday, 2 PM it's closed for the weekend, and each day there's a two hour lunch break. You can't make this up. But throughout schools, hospitals, complain about being understaffed, including private companies, yet when they try and increase wages to attract talent, said wages are immediately taxed. I can go on for ages, but something's way off about the country and it seems like a lot of factors are converging and forming a perfect storm.
- Nextgrid 3y agoAgreed that taxation is atrocious. But the problem isn't taxation per-se but who pays the taxes. Paying ~40% taxes at 100k, effectively ending up with 60k, which considering the current cost of living, insane rent crisis and general inflation, is a major problem. Paying ~40% taxes on a few millions? I think that's fair and isn't going to inconvenience anyone or put them in a precarious situation.
- giantg2 3y agoCan't do much about the demographics with the aging population. They probably can't or won't do much on the business/economy. Seems the only thing left to do is raise taxes, or cut services. This is really a similar thing we're seeing in other countries with aging populations. Even look at the US social security - raise the tax to support it, or reduce the services.
- gloryjulio 3y agoThe only way it will work in ideal world is to let the rich and old to cough out some shares to let the average young population to have better chances and willing to have more kids. But we will never reach that point
- toomuchtodo 3y agoThe young will leave for better pastures when they can, and when they can't, they'll just stop having kids and the locale will die out. Sad watching the old and wealthy choke the future to death, but that's humanity for you.
- HWR_14 3y agoThe government has to tax to pay for things. Birmingham has been legally constrained to raise taxes at a maximum of 5% per year, even with the massive inflation in the past few years. A 10% increase this year (what they are asking for) will still put them at an (inflation adjusted) lower tax rate than 2019.
- gumballindie 3y agoIt also has to spend money well, stimulate growth, and whole lot of other things than taking people's money away to patch things. The only option as it stands is privatising the NHS.
- fakedang 3y ago> The only option as it stands is privatising the NHS. This is akin to political suicide though. Remember, the conservatives' Brexit battle cry was 300 million pounds for the NHS.
- gumballindie 3y agoWell it’s either the NHS, the tories, or the country. Labour dont have a plan either. Taxing everyone to death is patchwork. The UK is in deep, deep, trouble and it ain’t the politics causing it. It’s the culture of making one bad choice after the other.
- fakedang 3y agoBetween the three choices you mentioned, it's pretty obvious the Tories are going to take down the country before taking down either themselves or the NHS. Although in all fairness, the quality of service in the NHS has already gone down for both doctors and patients.
- KaiserPro 3y ago> The only option as it stands is privatising the NHS So we have a shortage of doctors, nurses and hospital places. Currently the state keeps a lid on costs because it sets the wages of about 1 million people nationally (more or less, its complicated, but doctors are paid in grades, and those levels are nominally set nationally, same with nurses, however scotland, wales and NI have some level of independence.) We have huge pent up demand (7 million people on the waiting list) And we have a limited and shrinking skilled workforce. It takes a good 12 years to train a doctor. 6 to train a nurse. what do you think will happen to wages when the whole thing is privatised? Yeah, so privatising healthcare isn't going to make things cheaper. especially as the NHS is pretty cheap per head by EU standards.
- Nextgrid 3y agoTaxation is not a problem. The only problem is who pays the taxes. With inflation and the current cost of living, nobody making under 50k (100k in London) should be paying any. The people at the top, who already only pay effectively single-digit percent rates of tax should be footing the bill and paying their fair share (technically if they were playing by the same rules the common working man is subject to, they should be paying ~50%). Of course, those same people that are meant to be paying the tax are sliding checks to politicians' pockets to ensure this doesn't happen, or are the politicians themselves.
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- mikhailfranco 3y agoSame story in The Register, but with more focus on failed IT projects: https://news.ycombinator.com/item?id=37404350 https://news.ycombinator.com/item?id=37404350
- lsllc 3y agoYes, that is apparently a contributing factor for Birmingham.
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- mikhailfranco 3y agoThe Guardian describing how unions bankrupted a local authority, so that (potentially, if it was like the private sector) all workers will lose their jobs. Priceless.
- MattPalmer1086 3y agoAlternate take: describing how the unions held the local authority to account after illegally underpaying women for a long time, which the supreme court had already ruled they had to pay...
- mistrial9 3y agoThis one-liner fails to show the long-term finances of capital versus cash flows; fails to address the regulatory environment under which labor was provided; failed to include records of legal actions against any or all participants parties; essentially a political one-liner, which is strongly discouraged on this forum
- sdfghswe 3y agoIf you know about the subject, I'd like to hear about capital versus cashflows.
- ep103 3y agoAs an outsider, it is rather hilarious that the top two responses to this story right now on HN are: * Our own local council in the South of England, BCP is in the doghouse too. We have extraordinary inequality of taxation at the root of it. We have some of the wealthiest areas in Europe, like Sandbanks where every house is a mansion with it's own private beach, but we still cant fill the potholes in roads in the poorest areas. So sad that they lack the courage to put basic policies in order. and * Guaranteed the only way they’ll think will solve the issue is higher taxes. The uk has run out of ideas and the only option seems to be taking people’s money away.
- nvarsj 3y agoI mean, they are both kind of true. The only thing palatable to the government is to raise income taxes. They won't dare touch capital gain tax or property tax - which is where the vast majority of wealth is concentrated. Income tax is absolutely brutal in this country, with the 100k cliff for example. It's very hard to accumulate wealth via salary.
- _dain_ 3y agoBoth are true. Property taxes haven't been re-assessed since the 90s. A minority of wealthy landowners are subsidized by a much larger group of salaried renters.
- tonyedgecombe 3y ago>Property taxes haven't been re-assessed since the 90s. Whilst technically true that doesn't mean that council tax hasn't increased since the 90s.
- _dain_ 3y agoYeah but that makes it worse, doesn't it? The benefits to being under-assessed compound year on year, as do the costs of being over-assessed.
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- throw156754228 3y agoI really don't know what our London borough's council does outside of garbage collection and passing school applications over to schools. Weeds overgrown on every footpath, litter all over the place. Oh they mow the local football pitch every blue moon. I pay 2500 pounds a year.
- danw1979 3y agoThey should publish an annual report outlining the spend. You might be surprised at what they fund, or rather what central government doesn’t fund. Nobody seems to sweep the roads or maintain the bike paths though.
- jsmith99 3y agoEven as an accountant it is very hard to understand local authority accounts. They are usually three years late and poorly presented. Also most of their spend is either recharged to central government or mandatory; discretionary spend is a very small part of the budget. By contrast, central government accounts in the UK are excellent.
- KaiserPro 3y agoSo the local council has a shit tonne of things to payfor, but no real control on either raising taxes or defining how to deliver those services. THey have a duty to: provide social care (as in old people, homeless, disabled, orhpaned, etc) Schooling (kinda) large swathes of health care planning road maintenance social housing a whole bunch of red tape implementations. However the actual execution is dictated by central government. Even the taxes you pay (council/buisness rates) are clawed back and redistributed. The local council has no real way to raise cash apart from cutting services, selling shit or risky investments.
- tonyedgecombe 3y agoThe more I think about it the more I believe social care should be taken out of the hands of local councils. The demand for social care is effectively infinite, it will always crowd out other services.
- amriksohata 3y agoLabour has done this to the Slough council too
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- ghufran_syed 3y agoWhen visiting england recently, the main problem seemed to be that both red labour and “blue labour” have essentially the same policies regarding regulation (more is better) and taxation (more is better), the only difference is deciding who pays the increased taxes, the poor or the rich. The idea of actually stimulating wealth creation, and then taxing it instead of taxing and regulating it into oblivion seems to have slipped everybody’s minds…
- benjaminwootton 3y agoLiz Truss was voted into power on that platform, but was then unceremoniously booted out a few weeks later when she actually tried to implement it and the bond and currency markets had a wobble. If only they could have weathered the storm, things might look very different by now.
- tonyedgecombe 3y agoVoted into power by the Tory party membership, not the general electorship. The problem Truss had was she was ignoring advice from the experts and proceeding based on faith. They couldn't weather the storm, they had already run aground and were about to break up on the rocks.
- mike_hearn 3y agoNot even that actually. Members aren't allowed to directly pick the party leader, they can only choose between two alternatives put to them by the MPs. If the members directly elected party leaders it would be run by Kemi Badenoch, a black female conservative software engineer who when she was younger hacked the website of a Labour MP so it said nice things about the Tories.
- KaiserPro 3y ago> The idea of actually stimulating wealth creation, and then taxing it The problem is, the UK has not actually been responsible for a lot of the minutia of running it's self, as it imported a bunch of regulation from the EU, which touched everything. Now, whilst we were in the single market, that worked reasonably well for us. Cheap skilled labour to plug our massive skills gap, lots of low tarrif countries to export to (although a lot of our exports are/were services which had higher barriers.) Now, 2007 came and that gave everyone an austerity fetish. The problem is that all of that reform and infrastructure that requires maintenance is now reaching end of life, but as its not been carried out for >10 years its all breaking at once. > What could we do to stimulate the economy? negotiate a real trade deal with the EU, our closest and biggest partner. However that means admitting that the _way_ brexit was handled was wrong, buy all sides. The remainers were against _any_ change, which meant that the first deal was voted down, causing us to leave the customs union and sort of single market. the brexiters couldn't handle any kind of compromise on "hard" brexit, and the backstop was the antichrist, because sovereignty, teaming up with the hardcore remainers to block the aforementioned deal (all be it for very different reasons) Thus we were left with the shit that johnson cooked up in the brief moments between naps, fucking his mistress, and selling access/assets/secrets to renovate his apartment (amongst other things) So we are now left with the odd situation where everyone knows, and largely agrees that brexit has fucked the UK. However we _cannot_ admit that, because that means we were wrong, and therefore like vegetables to a three year old, we must blend, disguise and generally hide any kind of closer cooperation with the EU lest the press, gammons/FBPE(pro/anti brexit nutters on twitter) realise whats going on.
- gabrielsroka 3y agohttps://youtu.be/wMykYSQaG_c https://youtu.be/wMykYSQaG_c
- CrzyLngPwd 3y agoOur government is a shit show. One clown after another, sending billions to their mates for failed projects or the US proxy war in Nulandistan, and the whole covid response was just a wealth transfer scheme. I have no faith in any government or anyone that wishes to be in government. They are all the same, no matter the colour of their tie.