Week 47 2011 29.11.2011

Tendring Topics……on line

'What goes around, comes around'

            There was a time – I remember it well – when the maximum loan for house purchase that Building Society and Bank Managers would approve for house purchase depended upon the income of the main wage earner in the applicant’s family.  That was in the days before it was assumed that both members of the marriage or other partnership would continue in full-time work even after a baby or babies arrived.   Then, provided one of the couple, usually the male, had a steady job they could buy their new home with a twenty or twenty-five years mortgage and a deposit of ten percent of the total cost.  If the local authority were prepared to act as guarantor and the applicant’s job seemed very secure, then a five percent deposit might be acceptable.

            When, way back it 1956, my wife Heather and I bought our bungalow in Clacton (the one in which I am writing these words) we had thought we could manage the monthly mortgage payments on the kind of home that we needed (I had just been appointed Additional Public Health Inspector by Clacton Urban District Council).  Raising the deposit though was a major obstacle.  We had been married for ten years but during that time Heather had suffered a life-threatening illness and had had a crippling operation.  We had two young children, and a loan to repay on the car I needed for my work.  My pay had been adequate but we had virtually no savings.   The Council was prepared to act as guarantor and we had only to raise five percent of the value of the bungalow.  It seems a totally piffling sum now but we were able to raise it only by selling Heather’s solitaire diamond engagement ring that I had bought eleven years earlier with a considerable proportion of the army back pay I had accumulated as a prisoner of war.

            There came a housing shortage.  It was destined to be made much worse by Mrs Thatcher’s ‘right to buy’ legislation that, within a short space of time, markedly reduced the amount of social housing available for letting.  With rents prohibitively high in the private sector, young couples yearned to get their feet on the first rung of the home ownership ladder.

            It was a time of low unemployment and relative prosperity.  Married women, including young mothers, carried on working, leaving their children in day care.    Banks relaxed their rules and made loans based on the total income of the applicants – not just that of the highest earner.  Many more became eligible for mortgages.  But, of course, there was no commensurate increase in the number of homes available for purchase.  The price of houses began to rise, and rise – and rocket!   The housing boom had begun.  Soon house price inflation soared well above general rise in prices.

             Banks competed with each-other in making tempting offers to would-be buyers.  Ninety-five percent mortgages became commonplace.  Soon there were one hundred percent, and eventually one hundred and ten percent loans to help prospective house buyers with their legal costs and their removal and furnishing expenses!

            It couldn’t, and didn’t last.  The bubble burst.  Home buyers (they had imagined they were ‘home owners’ but they weren’t!) or their partners lost their jobs and half their incomes.  They couldn’t keep up the mortgage payments and either sold their homes at a loss, or were dispossessed by the Bank. House prices plummeted. The homes thus recovered by the Banks were often worth only a fraction of the sums originally loaned on them.  Some Banks would have been declared bankrupt had they not been bailed out by us taxpayers.     

            Right now we have stagnation.  Few new houses are being built.  Skilled and experienced building workers – bricklayers, plumbers, electricians – are unemployed.  Many people are homeless or inadequately housed. There is an acute housing shortage and there is nothing like sufficient social housing available for rent.

            There is, of course, an obvious solution – repeal the ‘right to buy’ legislation and encourage local authorities and Housing Associations to build housing for letting, fund them adequately and leave them to solve the housing problem in their own areas – as they did successfully for a century before the advent of Mrs Thatcher’s Conservatism and its pale-pink New Labour shadow.  That would have been true ‘localism’.

            Is that what the Coalition Government is going to do?   Not likely; they are going to encourage remaining council tenants to buy their own homes with discounts as high as 50 percent (well, it isn’t their money they’re giving away!) and guarantee,  with taxpayers’ money, part of the mortgage on  homes newly built for sale at affordable prices.    This, it is hoped, will encourage Banks to reduce the level of that difficult deposit and bring home-purchase within the scope of ordinary people again. This, so they declare, will stimulate the building trade and thus get the general economy moving.  I hope that it will!  It seems to me though to be offering to bail out the banks before they are even in trouble, and bringing us back to a situation similar to that at the beginning of the house price boom.

‘Ere the winter storms begin’

          The harvest hymn tells us that, ‘All is safely gathered in, ere the winter storms begin’.   And so it should be – but those of us who live in towns know that bringing in the harvest is not the only task that needs to be performed before the winter storms, the ice and perhaps the snow are with us again. Among them are repair of the damage done to our roads and footpaths by the last two hard winters.

Well, here are a couple of local examples of road and footpath disrepair that need urgent attention.  They are by no means the only examples of highway neglect in Clacton and they are almost certainly not the worst, but they are examples that I see regularly.  The footpath is beside Old Road and is regularly used by pedestrians (and mobility scooterists) on their way to Morrison’ supermarket.  It is a positive danger to those unsteady on their feet or with impaired sight, and a source of bone-shaking discomfort to scooterists.  I speak from personal experience!

            The pothole is in Beaconsfield Road, near its junction with Skelmersdale Road.  If it doesn’t receive attention it will get much worse, and more dangerous, in the coming winter.  Unspectacular work like this is far more worth-while than, for instance, the wholesale reconstruction of the seaward end of Pier Avenue last winter – when the dust had scarcely settled on the precious reconstruction!

The ever widening incomes gap!

          At last – the gaping chasm between the incomes of the poorest and the wealthiest of us has received the attention of an official investigation and is being brought to the attention of the government.  It seems that the average income of the staff of a top FTSE100 company is £20,000 a year (for many people even that is wealth beyond the dreams of avarice!) while the incomes of Directors and Chief Executives of these companies is – wait for it! – more than three and a half million pounds a year.

            A CBI spokesman explained to us on TV this morning why nothing could – or should – be done about this.  It’s all because of that wonderful Global Market. Profit-making enterprises throughout the world need the very best brains to make them even more profitable.  They are prepared to pay the best salaries, bonuses and other perks, to get them.   If we lesser mortals were to attempt to limit the number of millions our top people receive (I can’t bring myself to write ‘earn’) they would simply up sticks and move elsewhere.  How very convenient, for some, it is to have an economic system that demands that the pay of workers gets ever lower so that we can be competitive in the global market, while that of their bosses has to get ever higher, for exactly the same reason!

Despite the obvious absurdity of this situation and world wide protests about its manifest unfairness and injustice, the Global Market is welcomed by all three of our main political parties!

Tweedledum and Tweedledee

            The government’s policy of cuts in public services and benefits, and of tax increases (in VAT and similar indirect or ‘stealth’ taxes) that particularly affect the less-well-off are really beginning to bite.  The provident, who have ‘nest eggs’ in savings accounts with banks and building societies are worse hit than the extravagant.  Their savings decrease in value as inflation outstrips the meagre interest that they earn.  Some  have lost their homes, many more have lost their jobs and practically all of us are beginning to lose hope.

            There would be one very simple and straightforward way of restoring our faith in the Coalition Government’s handling of the economic crisis and persuading us that the sacrifices we all (except the seriously wealthy) are having to make, have been worthwhile. Why not – perhaps quarterly or half-yearly – reveal by how many (surely millions) of pounds the deficit has been reduced during that period?  Then we would know whether or not the gain had been worth the pain.  As a former public relations officer I am astonished that this isn’t already happening.  Could it be that there has been no decrease?  Perhaps there has even been  an increase in that worrying deficit; one that even the most accomplished spin doctor would have difficulty in attributing to the previous Labour Government, or to ‘Brussels’, or to whom or whatever is the latest popular scapegoat.   

            That is very possible.  The cynical may see it as a reason why no such disclosure has been made.  A blog reader points out that the government, in formulating its financial strategy must have been expecting the national economy to show modest (perhaps 2 percent) growth.   This would have been expected to bring a reduction in the number of benefit claimants, together with increased revenue from corporation tax, income tax and VAT.  In fact the government’s austerity policy has killed economic growth, increased unemployment and suppressed demand.

            It is an unfortunate fact that we have to rely on their political opponent’s estimates of the effects that their policies, and those of their rivals, would have on the deficit.

            The Conservatives claim that Labour’s policy of reversing ‘the cuts’ to stimulate the economy, would increase the deficit by £85 billion a year by the end of the present Parliament.  They may well be quite right.

            Labour has considered Office for Budget Responsibility forecasts from November 2010 together with the latest estimates from independent forecasters, They predict that the coalition government’s borrowing could rise by £11 billion more than planned this year, £22 billion next year, £34 billion in 2013 – ’14, and £42 billion in 2014-’15.

            Voters at the next election will, it seems, have a clear choice.  Vote Conservative, cut even deeper, and increase the deficit, or Vote Labour, reverse the cuts and – though in a slightly different way – do the same thing!

            Well, it isn’t all that likely that I shall still be around for the next General Election to have to make a decision! 

An Affront – or a Lucky Escape?

          A couple of weeks ago members of Tendring Council, together with the local press, were full of indignation at the fact that Tendring was the one district in Essex through which the Olympic Torch  would not be carried next year as it makes its tortuous journey to the Olympic Stadium at Stratford.

            Now I learn that the passage of the torch through Colchester on July 6^th   is expected to cost the district council £30,000 in road closures, crowd control and street cleaning.  Our omission from the route may have been a blow to our local pride but I reckon that in every other respect it was a lucky escape!

Week 38.10 21st Sept. 2010

Tendring Topics……on line

An Outbreak of Truth – and Common Sense!

Yes, there does seem to have been a worrying outbreak of truth and common sense recently. There is no cause for alarm though. It is probably just a mild attack that won’t spread and from which we can hope for a complete recovery.

Here are a few of the more distressing symptoms: The Governor of the Bank of England, addressing the members of the Trades Union Congress (whom The Sun could have told him were ‘a bunch of loony lefties’) confessed that the current financial crisis was not, as had previously been thought, all the fault of the previous government; nor even that of work-shy receivers of benefit and public services. The causes were the greed and incompetence of ‘the financial sector’, bankers like himself. The members of the TUC were, he went on to say, ‘right to be angry’. Fortunately he refrained from suggesting ways in which those who were responsible for the crisis might be made to pay their share of the cost of its remedy, thus easing the burden of those who were innocent. That would have suggested that his condition was terminal!

Nor was the Bank of England’s Governor alone in showing worrying symptoms. The East Anglian Daily Times, is a very good and reliable regional newspaper. I always enjoy reading it and have recently greatly appreciated its ‘readers letters page’. Its core readership consists of comfortably off residents of small towns and rural communities in Suffolk, Norfolk and Essex. It would, I think, be fair to describe its political position as ‘centrist’ though with a tendency to veer to the right. It has certainly never before, to my knowledge, strayed to the left of that centre line.

Yet below is an extract from a leading article on Tuesday 14th September, below a less-than-snappy headline Greed is not good:

‘Some people appear oblivious to reality and devoid of common sense. Many FTSE 100 firms have cut costs because of the recession – a euphemism that invariably means staff have been axed. Yet executive bonuses are close to pre-financial crisis levels. Average bonuses for directors equated with 100 percent of salary. That displays no sign of empathy with those less fortunate…………

…………It is an affront to their fellow men when those who enjoy comfortable lives abuse their positions. Let’s hope that, one day, they realize it and act rather less selfishly.

. Not exactly a rabble-rousing call to ‘Raise the red flag and man the barricades!’ but, for the East Anglian Daily Times, a worrying lurch to the Left.

So much for Truth; how about Common Sense?

Well, if Honesty is the Best Policy (though it is rather sad if that is the only reason for adopting it!) it follows that the pursuit of Truth must be Common Sense. What I actually had in mind though was that the question of whether or how we should replace Britain’s Trident independent nuclear deterrent may possibly be left until after the next General Election*. To renew it would cost billions of pounds at a time when we are told we must save every penny. I hope that, by the time of the next election a comfortable majority of voters will have realized that Trident isn’t independent (can you imagine it being used, or even used as a threat, without the approval of the USA?) and it hasn’t yet deterred anybody.

It didn’t deter Turkey from invading Cyprus, Israel from invading Lebanon, Georgia from invading South Ossetia, and Russia responding by invading Georgia. It didn’t deter the USA and its allies from invading Grenada, Argentina from invading the Falklands, or Iraq from invading Kuwait. Its use against a non-nuclear state is unthinkable and its use against a nuclear one would result in Mutually Assured Destruction. How appropriate that the acronym for such a policy is MAD!

The armed forces, like every other field of human activity, have to face cuts. Considering all that members of the present government have said about their predecessors starving troops in Afghanistan of necessary equipment, they can hardly look in that direction for savings. It has been suggested that the building of two new aircraft carriers might be cancelled. I hope not – not because to do so would deprive an impoverished area of Scotland of much-needed jobs – but because the giant craft are pieces of ‘defence equipment’ the use of which is not limited to the killing of our fellow men and women.

Aircraft carriers, and the aircraft they carry can be, and have been, used for the relief of man-made and natural humanitarian disasters. They can carry vast quantities of badly needed relief and reconstruction supplies and can be used to evacuate threatened civilian populations. They are the very last items of war equipment that should be considered for sacrifice.

*This now seems to be in doubt. An official spokesman says that it has already been decided ‘in principle’ to renew the Trident programme. Others seem less certain. We’ll just have to wait and see.

A real cause for concern

I have just watched on tv the ‘distribution’ of desperately needed food to a starving community in flood stricken Pakistan. I have put ‘distribution’ in quotes because it was, in fact, a riot demonstrating a practical application of Darwin’s theory of the ‘survival of the fittest’ . Those who were fittest and strongest grabbed the food that they and their families needed. The weakest went hungry – and are destined to become even weaker! Long before the truck was emptied, the driver for his own safety and that of his helpers, drove away – with the truck still full of food-grabbing rioters!

It was an incident that underlines the need for ‘the West’ to do much, much more, not only to provide more help for Pakistan but to ensure that aid is distributed fairly and competently. The situation is dangerous, not just for the people of Pakistan but for all of us. How long do you suppose it will take Taliban fanatics to persuade a starving population that all their troubles, the deluge and its aftermath, are God’s punishment for their government’s support of the infidel British and Americans? The remedy, they will urge, is in their own hands!

Don’t forget that Pakistan is a country that has nuclear weapons and, thanks to unstinting military aid from the west, the means to use them. I reckon that the fact that both India and Pakistan and, not too far away, Israel, actually possess nuclear weapons is something that should be giving us many more sleepless nights than the fear that Iran may, just possibly, be trying to acquire them!

It seems but yesterday………

And, in reality, it wasn’t very long ago, that Clacton’s Pier Avenue had its layout altered, its pavements widened and re-laid, and was provided with new vandal-resistant street furniture. There was also the famous or infamous town centre water feature, about which I wrote – over-optimistically it seems! – last week.

I think that we Clactonians have now accustomed ourselves to the new town centre. As a mobility scooter user (and there are nowadays quite a few of us!) I very much appreciate the wide, smooth-surfaced, footpaths.

Work in progress in Pier Avenue (Sept. 2010)

Now though, believe it or not, they’re at it again! Tendring District and Essex County Councils are spending £325,000 narrowing the seaward section of Pier Avenue to a single lane, widening footpaths, improving street lights and CCTV, and planting trees.

Admirable, perhaps – but aren’t we supposed to be at the very beginning of a financial crisis in which we have all been warned to expect cuts in or the abandonment of essential public services, never mind new projects that are, at best, of dubious benefit.

If the two councils really have over a quarter of a million pounds ‘in the kitty’ that simply must be spent on Clacton’s highways, I would have thought a better objective for their prodigality would have been the repair of the broken, uneven and dangerous-to-pedestrians footpaths in many parts of the town.


Right - footpath in Clacton's Anchor Road (Sept. 2010)

Twice the Prime Minister’s pay packet!

Once again we find the Prime Minister’s salary used as a benchmark for wealth. Joanna Killian, Essex County Council’s Chief Executive, is said to have a salary of £285,000 a year, almost double his! Ms Killian, who has held the post with the County Council since 2006, was also appointed Chief Executive to Brentwood Borough Council a year later. That £285,000 must be the salary for both jobs. She surely can't be drawing another six figure salary from Brentwood!

It seems too that she is a firm believer in ‘no expense spared’. In 2009 she used a council credit card to pay for a staff member, who had been struck down with food poisoning at an office event, to take a room at Claridges Hotel in Mayfair. She also spent £270 on champagne for two officials from Kent County Council who had helped with an Essex project and £55 (just small change really!) on flowers for another colleague.

I am not all that interested in comparing her salary with that of the Prime Minister. He does, after all, enjoy other worthwhile perks. I wonder how it compares with other professionally qualified colleagues at County Hall. They all, I am sure, do difficult and important jobs serving the public. They couldn’t do her job – but then I’d be very surprised if she could do theirs. One of the reasons why there is such an enormous gap between the highest and the lowest paid employees of the council is the practice of paying staff percentage pay increases. This enables top earners to claim, ‘I had just the same pay increase as my secretary and my PA’, while pocketing thousands of pounds more. With every national percentage pay increase the gap between the highest and the lowest widens. As I have pointed out before in this blog, five percent of not-very-much is very little. Even one percent of a six-figure salary can be a considerable sum.

One thing that I find really extraordinary is that Ms Killian should simultaneously be chief executive of Essex County Council and of Brentwood Borough Council. When I was appointed Clacton’s Housing Manager and again when I became Tendring Council’s PRO (both infinitely less important and infinitely less well paid than a CEO!) it was stressed that I should devote all my time to my work and could not take any other paid employment. I had to get the Council’s permission to pursue my freelance writing, which was by that time earning me a few hundred pounds a year. They agreed when I explained that my writing was a hobby and that, unlike most hobbies that cost money to pursue, mine actually made a little money. They would certainly never have agreed to my taking on a part-time job with another authority!

Quite apart from the principle involved there must surely have sometimes been a conflict of interest. In my experience County Councils and their constituent District and borough Councils don’t always agree.

Mind you, I had been astonished – a few weeks ago - when I learned that the wife of the County Council’s Head of Communications (now on leave of absence) was a senior officer in the same department (she has now resigned). Essex County Council is clearly a law unto itself in these matters!