FTSE 100
Dow Jones

Friday, 16 October 2009

Tax a bit and spend more

We are now at the Friday after the Sunday when we first heard than Gordon Brown hoped to raise £3 billion with various disposals. He hasn't got anywhere with that, but the money is already spent in excess spending, so you would expect the government to be drawing in its horns.

Well, not at all because they have just announced an additional £5 billion measure, due to the fact that we have moved into negative inflation territory. Various allowances, including pensions are linked to the annual growth in RPI, which this year has actually been negative to the tune of 1.5%. But that of course will not do in an election year, particularly with a budget only a few weeks before the elections begin, so the chancellor has proposed that there should actually be a 2.5% increase in pensions and personal allowances, or 4% ahead of RPI and an additional £5 billion.

Which just goes to show that (a) politicians don't stick with their principles when doing so will it hurt their own prospects and (b) they are never too ashamed to try bribing us with our own money.

No comments: