Monday, December 15, 2008

Austerity government

Endless reams have been written about the credit crunch ushering a new period of austerity and restraint. Unfortunately, someone forgot to tell the government.
Opposition politicians and union leaders have expressed astonishment at the cost of the project to create a new home for Justice Secretary Jack Straw and his staff.

The remodelling of the concrete tower block, next to St James' Park in London, cost £915 a square foot to complete – around 18 times more than a standard refurbishment would cost in the private sector.

In addition to the refurbishment costs, £2,745,000 was lavished on new furniture and fittings for the offices and £290,000 was spent on artwork.

As Timmy points out, we don't need to wonder why government is so expensive.
No, you don’t need to wonder why government is so expensive. You don’t need to wonder because now you know.

Yep, the money goes on making palatial headquarters, tricked out to match the over-inflated egos of our idiot politicos, using over-inflated budgets.

Seriously, what the fuck were they thinking? I mean, we all know that the government is a simple shopper, willing to pay well over the odds for just about anything (believe me, I look at tenders sometimes and think, "wow. Really? They're willing to pay that?"), but eighteen times what it would cost in the private sector is something pretty fucking special, isn't it? Whilst we all don our hair shirts, the government is continuing to spend our money like water.

I was talking to someone who works at the Treasury the other night, and he was maintaining that the government was "on track" to borrow about £80 billion this year. But, I argued (having first checked that they operated on the same financial year as the rest of us), they had already borrowed about £70 billion by September—only half-way through said financial year—so how could they possibly be on track to borrow only £80 billion this year? Especially given that Gordo and his merry men are throwing money at the banks (and all of that is leaving aside the fact that they estimated this year's borrowing at £45 billion).

Now, I may have brow-beaten the poor chap into submission (or maybe he just didn't have an answer), but isn't it slightly worrying that someone in the Treasury doesn't seem to know the state of the public finances?

No wonder the state is still throwing our cash about...

16 comments:

chris said...

Maybe he was mixing up Financial and calendar years? Which would still be worrying, and £80 billion still looks low. I'm more worried about when they hit bottom with interest rates and start printing money, because they won't stop.

Gareth said...

Chum from the Treasury might be ignoring the monies so far actually spent on bailing out banks.(Over £20billions for B&B and the Icelandic debacle) They are certainly doing that for the following two years if the PBR is to be believed.

Under Maastricht Treaty rules public sector debt will be nudging 70% of GDP in just a few years. The fiddled figures excluding borrowed bank bailout billions is predicted to be about 60%. HM Treasury are notoriously crap at their projections.

'It's not so bad' they keep saying. 'Look at Germany, look at Italy' Both high public sector debt countries they may be, but the devil is in the detail: To differing degrees both are the manufacturing heart of Europe. Are we?

Tell a big enough lie and everyone else will believe it. Tell it too many times and so will you.

Bishop Brennan said...

As I found at the Diocesan Council, self-deception is quite an easy place to get to... Then the whole culture of the place enforced acceptance of the lies.

That's why most who stood out against it left...

black hole sunset said...

I'd vote for the Dark Prince himself if it'd unseat Labour.

The trouble is, my area is solid Labour territory and the local MP is a known Blairite so even if I could be arsed to write to him pointing out what a worthless shower of scat-munching, brown-toothed trolls they all were, it'd just land on the desk of one of the movers and shakers of that whole airheaded post-sanity movement.

Call me Dave has done one thing so far that has impressed; call Crass Gordon out for an election even though the the trend is going against the Tories - pretty gutsy by contemporary standards.

No way our esteemed bogey scoffing jocktard would do the same - could break the Messianic spell.

Henry Crun said...

Because, DK your Treasury chum has fallen for the Enron-style acounting system so beloved of Gordoom.

Everything's off ballance sheet. We're borrowing loads of wonga to fund Northern Rock, RBS, HBOS. Old Uncle Tom Cobbley's Building Society et al, but none of it will show up in the current accounts. It's borrowing now but repaid at some unspecified point in the future.

You should ask your Treasury chum what the impact of Sarbanne Oxley would be on the Govt accounts would be.

CityUnslicker said...

AAARRRGHHHHH!

Chalcedon said...

They never kiss us, but they always fuck us. Which idiots voted this lot in again and again after the first time? They should be shot for idiocy.

Anonymous said...

HMT employs staff covering a lot of different areas. I wouldn't expect someone who e.g. analyses the impacts of landfill tax rates or who helps draft PFI guidance to know necessarily what the state of the public finances are.

I have however spoken to an HMT chum who turns ashen faced whenever the subject is broached which would suggest to me that we are indeed fucked, and probably a lot worst than most of us could imagine.

DWMF said...

Andrew Craig in his book "Squandered" says that a massive bill redecorating head office is a tell-tale sign that massive amounts of money has been stolen, or just "gone missing".

So don't expect Whitehall offices to now sport knee-deep shagpile. It's the gummint trying to shave a few quid off their embarassment.

Rotten Borough said...

Take a look at page 184 of the pre-Budget report - they are expecting 0.75% growth for 2008!

How the fuck are they going to manage that, when it's already negative and things are going to get better before they get worse?

And if growth is lower than predicted, tax revenues will be lower than predicted and government borrowing will be even higher.

But the Treasury must have known, when they published it in November, that there wasn't going to be any growth for 2008. So are they just lying to hide the true horror from us?

Robin said...

It doesn`t haveto be £80 billion. Minus £20 billion for the EU brings it down a bit.

Anonymous said...

I'm aware of a deal done 5 or 6 years ago with the VAT man where they paid the purchaser of a building in Birmingham a six figure sum to get out of a lease. The new owner (a developer) refurbed it and then marketed it, only to end up leasing it to.... yup, you guessed it... the VAT man.

I also bid as developer on a bespoke building required by HM Govt for a hush hush thing I can't mention as I signed the official secret's act.

Needless to say, the deal on the table was massive because no-one in their right mind would put an alternative use value on the building because of the onerous lease terms offered by the Gov't (ie very very short lease break options requiring very very short write-downs on capital.. So, the Govt get to pay about 5 times 'market' rent for a bespoke building, with short lease breaks and guess what - they are still there and likely to be for years to come....

What a bunch of tossers they are.

NOTE: When the private sector are building anything at 35% discount on 18 months ago how come the olympics build cost is, we are told, still rocketing???

Imbeciles the lot of them.

xelent said...

Anon makes a good point.. In my experience within the software industry, a lot of the reasoning behind the higher prices is due to the messing around of govt officials the private contractor receives..

You see unlike the private sector where profit is king.. In the public sector they have 'gifts' then costs to consider.. A contractor can be turned over literally if he failed to buy the official his last pint the night before.. That contractor may have shelled out anything from £10,000 - £100,000 before any signature hits the paperwork...

I’m convinced the high cost is not about lazy govt, but all about the 'unwritten rule' that the contractor must lavish all manner of 'good will' on the officials concerned before hand... The rewards are huge if you win, but failure is almost a guaranteed bankruptcy..

joe bonanno said...

ps - saying f*** a lot doesn't turn a dull post into something cutting edge.

Trust me.

It just makes a tedious post even more tedious.

Keep trying though.

wonkotsane said...

I work in a building leased to (but not occupied by) the revenue and the company I work for has ended up having to pay the cost of filling in the fucking boating lake that appears every few months in the entrance to our overspill carpark. Seems that the money is only available to some parts of the civil service.

Anonymous said...

I reckon the odious Injustice Secretary Jackboot Straw is the grey eminence of this regime-rather than Baroness Mandy. This old red, with no discernable talents or popularity, is the only one besides Gorgon who has continuously held a senior cabinet job in NuLiebour since 1997.