Mr Incredibly Stupid

If ex-News of the World editor Andy Coulson did not know his reporters were illegally tapping the phones of various prominent people then he is incredibly stupid and utterly incompetent. If he says he didn’t know but, actually, he did, then he is a liar. Either way, he shouldn’t be employed at the heart of David Cameron’s Government. For once, it’s hard not to sympathise with John Prescott.

I suppose only an appalling cynic would wonder if the furore over William Hague not being gay, and Mr Coulson's embarrassment were in any way connected but it is coincidentally a useful smokescreen for the ex-News of the Screws boss to hide behind. Let's wait until the smoke clears.

Bounty hunters? Try paradise

David Cameron is right to employ bounty hunters to crack down on benefit cheats. But why stop there? What about bounty hunters to crack down on tax evaders as well?

They cost the honest taxpayer far more than the unemployed underclass.

Some estimates put the “tax gap” at £120 billion. The taxman says it’s £40 billion.

The Coalition is to employ an army of snoopers, on a five per cent commission, to trawl through people’s bills and financial records in search of benefit frauds.

No doubt they’ll find a reasonable number of people. Mr Cameron claims fraud costs the honest taxpayer £1.5 billion a year.

The benefits system is so complicated, though, that genuine mistakes by claimants and the Government come to another £3.7 billion of money “wasted”.

Some fraudsters aren’t hard to spot. Court cases crop up regularly involving the bloke who claims he’s laid up with a bad back and is out cleaning windows or someone with a gammy leg who turns out for his Sunday league side every week.

It may be that Dave’s army of curtain-twitchers and dustbin-snoopers will save us a fortune. Let’s hope so.

But if we’re taking a high moral tone about the feckless and idle, what about the rich and industrious?

We can’t really be sure how much benefit fraud costs because it’s a crime people try very hard to conceal. In the same way, nobody really knows how large the “tax gap” is either.

Her Majesty’s Revenue and Customs, our official tax-gatherers, put the figure at £40 billion. Other experts say it’s three times as much.

Either way, the Government is missing out on a vast sum of money.

The difference between what the Revenue thinks it ought to receive and what it actually gets – the tax gap – includes illegally evaded taxes and those which are legally avoided.

There is nothing wrong with making sure you tax bill is as low as possible. It’s up to the Government to make sure the laws are watertight.

If big multi-national companies and lucky billionaires can find ways to cut their tax bills and stay on the right side of the law, good luck to them.

Some people claim it’s immoral to keep your tax bill to the legal minimum. But few of us would willingly pay more tax than necessary – especially when we see how much of it is wasted. Morality has nothing to do with it.

Tax avoidance is fair and reasonable. It’s up to the Treasury to deal with loopholes in the law.

But there would be no harm in appointing an army of bounty hunters to go after individuals and companies which actively evade paying tax.

Imagine who might fall into that category. For instance anyone who has paid a builder in cash, to avoid the VAT, or failed to declare their earnings, could be ripe for investigation.

The black economy – or “shadow economy” if you’re politically-correct – is worth billions and set to grow when VAT hits 20 per cent in January.

But a few cash-jobs are chicken-feed. From time to time we hear of great HMRC triumphs when a gang of VAT cheats or cigarette smugglers get brought to justice.

In May, 21 people, including nine men from the West Midlands, was jailed for a £37.5 million VAT fraud.

Last month, Wolverhampton car-parts dealer Balbir Baden was jailed for evading £270,000 of VAT and income tax.

Even these cases are only the tip of the iceberg.

HMRC says in its annual report that “the proportion of UK taxpayers who are willing and able to pay their taxes has increased from 49.1 per cent to 51.6”.

This is apparently seen as something of a success. But it means that almost half of the people and companies in Britain are either unwilling or unable to cough up. That’s a lot of potential for our bounty-hunters.

One of the most bizarre legacies of Gordon Brown’s time at the Treasury is that he spent many years cutting down the number of tax-gatherers.

For someone desperate to spend our money, it’s surprising he was so negligent about collecting it all in the first place. But he was.

As a result, the revenue doesn’t have enough experienced staff to crack difficult tax cases. They are far more likely to come down hard on the corner shop-owner than they are on the multi-national corporation.

There are one or two household name businesses which manage to pay little, if any, tax in this country or anywhere else for that matter.

So why doesn’t the Government accept its own customs men aren’t up to the job and hand the task of chasing the missing billions to the private sector?

The vast sums of revenue the Government misses out on – maybe more than ten times as much as it pays out to benefit fraudsters – must be worthy of investigation by a few privatised bounty hunters.

There is a simple alternative, of course. Cut taxes so drastically it’s no longer worth trying to evade payment and Government income would actually go up. Unfortunately, that doesn’t seem to be an option.

We can still make it

Anyone with any sense watches “Top Gear”. The larking about by Jeremy Clarkson, James May and Richard Hammond is the only thing that saves the BBC from drowning in political correctness.

But they did something unusual for the last episode in the series. They performed a requiem for the British motor industry buy taking a Lotus Elan, a TVR S2 and the Jensen Healey for a spin across the country.

They visited the shut down Jensen factory in West Bromwich and went on to the similarly abandoned TVR plant in Blackpool.

There was plenty of messing about and schoolboy pranks on the way but in the end this was a plaintive lament for the death of the British motor industry from three of its all-time fans.

At one point in the show, Clarkson kicks around the Jensen factory and says: “In the 1970s, 26 per cent of the British workforce was employed by manufacturing. Today it’s nine per cent. It’s not that we don’t make sports cars any more – we don’t make anything.”

The other day I drove past the old Longbridge plant in Birmingham, once the biggest car-factory in Europe. A bit of building is going on but most of it’s a flattened wasteland.

For someone who was brought up just down the road from “the Austin”, it’s a sorry sight.

Even so, Clarkson and co are wrong. The British car industry is not dead. Actually, it is alive and well.

The difference these days from the lamentable past is that it’s foreign-owned and the unions seem to have learned their lesson the hard way.

Globalisation, consolidation and rationalisation put paid to the dozens of famous old names and marques we used to know and love.

Instead, the industry is owned by a handful of multi-nationals. Like the big banks, some of them are incompetently run and rely on Government handouts to keep them alive – just ask General Motors.

Yet while successive British Governments have cared less and less about the ability of this country to make things, somehow industry has carried on regardless.

Astonishing as it may seem, British factories are manufacturing hundreds of thousands of cars a year. And many of them are being exported to foreign countries.

We are not the world power we once were when it comes to sheer numbers. We’re 11th in the world car-production league table which puts us behind Brazil, Mexico, Canada and Spain but we’re still ahead of Italy.

Jensen Motors ceased trading in 1976. The following year, according to the Society of Motor Manufacturers and Traders, British industry manufactured no fewer than 1,315,972 cars and commercial vehicles.

That was, admittedly, down on the 1.9 million the industry hit at its peak in 1972 but even in 1976 people were talking about the death of British manufacturing –warning it was on the way unless the unions backed off.

They didn’t, as we all know, and so famous companies started to go to the wall. A lot of old names are no more: Hilman, Riley, Triumph and Sunbeam to name but a few.

Even so, new models and new manufacturers have taken their place. This country still makes Minis, for instance, and very successful they are too.

OK, so they are made in Oxford by German-owned BMW but, given the fiasco that MG Rover became after it was flogged off to the Phoenix Four, we’re lucky anything was salvaged from the wreckage.

Meanwhile companies like Ford and Vauxhall continue to make cars here as well as Nissan, Toyota and Honda.

Because they’re foreign-owned there is, perhaps, more chance that they will abandon ship and go elsewhere. But plenty of British-owned companies have done that already so patriotism won’t help much either way.

What we can say, though, is that things have not got any worse since Jensen stopped making cars in West Bromwich.

The British motor industry may employ fewer people but that’s because the manufacturing processes are so much better. And it churns out pretty much the same number of cars we were making 34 years ago.

In 1980 we made 1.3 million vehicles in this country. In 1990, the number had risen to 1.5 million. In 2000, it was 1.8 million and was still at 1.6 million in 2008.

Admittedly last year was a nightmare for car-makers. As we all know, factories shut down for months on end and nobody wanted to buy anything because of the credit crunch and the recession.

In 2009, the number of vehicles made in this country only just squeezed above the one million mark at 1,090,139.

But the industry has bounced back this year. In the first six months, we made 701,266 vehicles. And guess what? No fewer than half a million of them were for export.

We might not make Jensens and TVRs any longer but Clarkson is wrong to sound the death knell for British manufacturing. We still have the engineering, the design, the technology and the workers to compete in world markets.

It’s just a pity we don’t seem to have the bosses and the investors to lead the way.

What's so special about this relationship?

What’s so special about our “special relationship” with the United States?

David Cameron was at it again in Washington after his meeting with President Obama, waxing lyrical about how much the countries have in common.

Even then, he admitted Britain was the “junior partner” – though “America’s poodle” might be a better term.

Why are we so subservient to the Americans? True, it’s a good idea to stay on the right side of the self-proclaimed “most powerful nation on earth”.

But it’s a very one-sided relationship. We do the Americans’ bidding; they kick us, especially when we’re down.

This week, Congress has been up in arms about why the Scottish Government released Lockerbie bomber Abdelbaset al-Megrahi, who is alive and well and living in Libya.

The accusation is that the Blair Government sold out the victims of that terrorist outrage in exchange for lucrative oil rights for BP.

BP – or “British Petroleum” as Mr Obama likes to call it – is Corporate Enemy Number One in the USA because of the Gulf of Mexico oil spill.

The Americans are desperate to distance themselves from this disaster and, as a result of their hectoring, there’s every chance one of Britain’s most famous and successful companies could disappear.

The Lockerbie fiasco is being used by the Americans as another stick to beat BP with. Yet instead of standing up to defend the company, Mr Cameron promises an inquiry.

This is typical of the way our leaders behave towards the Americans. Even Winston Churchill was forced to treat them with kid gloves – and he was half American.

The USA has never rushed to our side in our hours of need. Americans think the 1914-18 Great War started in 1917 when they finally agreed to play some part in the struggle.

As for the Second World War, we are now celebrating the Battle of Britain which took place during the summer of 1940.

Why did Britain stand alone against the might of Hitler’s Nazi war machine?

Why was the beacon of liberty a guttering flame kept alight by a few RAF airmen and the bloody but unbowed attitude of the British people and its wartime Prime Minister?

Because the Americans wouldn’t help us. They were desperate to stay out of the war.

Churchill did everything he could to interest President Roosevelt in taking an active part but he refused to commit. It wasn’t until the Japanese bombed Pearl Harbour in December 1941 – more than two years after the outbreak of war – that the United States were finally forced into action.

For Britain, the Japanese attack was a turning point even if it may not have felt like it at the time.

Finally, the Americans became our allies and comrades in arms. Not because they wanted to support us but because suddenly, out of a clear blue sky, they had no choice.

By the end of the war, Churchill was able to coin his “special relationship” phrase which we’ve been saddled with ever since.

It hasn’t been plain sailing, though. Mainly because the relationship is not between equals or even senior and junior partners. It’s more like master and servant.

Almost 100,000 British troops supported the Americans in the Korean war from 1950 to 1953. Three years later this country was humiliated around the world when the United States refused to back our defence of the Suez Canal.

Mercifully, Harold Wilson refused to commit British troops to America’s war in Vietnam. That may help explain why America found it impossible to back us when Argentina invaded the Falklands.

Though Mrs Thatcher and Ronald Reagan worked well together to bring an end to Soviet Communism, it was still a fairly one-sided affair.

Britain became America’s European aircraft carrier, the home for cruise missiles and bombing raids on Libya.

If only Tony Blair had shown some of Harold Wilson’s mettle, British soldiers would not have invaded Iraq on the basis of sexed-up dossiers and they would not be dying in Afghanistan.

Those two wars, more than anything, show the shameful nature of this country’s relationship with America.

If Mr Cameron and Mr Obama plan to withdraw from Afghanistan in five years’ time, their promise is an admission of defeat.

Meanwhile British soldiers will continue to lose their lives during a long, painful and humiliating retreat.

Yes, America is a great country; we should be on friendly terms.

That’s different from slavish fawning just because they’re strong, we’re weak and we happen to speak more or less the same language.

For all their dominance, Americans are sensitive souls. It seems they’re unhappy because Mr Cameron, talking of his admiration for their country, said: “I think of my grandfather going ashore at D-Day, with the Americans in support of the British.”

Grandfather Cameron may have made it onto the beaches but every American knows Tom Hanks liberated Europe for the Yanks.

And what do the Americans think of the “special relationship”? Nothing at all. As the novelist Julian Barnes said: “Any foreigner visiting the United States can perform an easy magic trick: buy a newspaper and see your own country disappear.”

Home is where the wallet is

House prices are stagnating and may not improve until 2015. Good. That’s what got us into this mess in the first place and it’s about time we looked on a house as a home not an investment.

Moat is no martyr

Why is anybody sorry the police ended up killing Raoul Moat? Some kids seem to regard him as an outlaw hero and he certainly ran rings around the police. Even so, it was not the police’s job to keep Moat alive and we’re well rid of him.

Nazis in wigs

A radio host has lost a fight to clear his name after calling a councillor a Nazi for banning smokers from adopting children. But it’s the High Court judges who are the Nazis. Because whatever you think of the council ban, surely people have the right to criticise. The word Nazi may be offensive but if we lose the right to be rude to people we lose a precious slice of our remaining freedom.

Berks and burkas

It’s tempting to want to follow the French in banning the burka, described across the Channel as a “walking coffin”. I hate them and, far from oppressing women, I believe they are used by many as a deliberate rejection of the society they live in. There are certainly times when people should be required to show their faces: at banks, when asked to do so by the police, at border controls or in job interviews, for instance. But we must not follow suit because people must have the freedom to stand out from the crowd no matter how anti-social or undesirable they look. Or are we saying that women who wear burkas are all terrorists?

Fun in the sun

Looks like we’re taking fewer foreign holidays because of the recession. Holidays at home are great if the weather’s good but they are invariably more expensive than abroad. Have you tried paying for a hotel recently? We stayed at a complete dive the other night and it cost a fortune.

In the wrong

Nobody cares about the schools in Sandwell – not Michael Gove and not Ed Balls. This is about politics, not education.

Time for another mutiny on the bounty

If charity begins at home and Britain faces cuts running into billions of pounds, why are we planning to increase spending on international aid to China?

Why, for that matter, are we planning to spend more money in India, which has one of the few booming economies left in the world?

Or Zimbabwe, which is run by Robert Mugabe, a dictator every bit as unpleasant as Saddam Hussein ever was?

Or the Pitcairn Islands, for that matter?

The coalition Government is adopting a slash and burn approach to public spending.

Thousands of jobs will go as Ministers struggle to bring down Britain’s massive debt from £163 billion.

We had a small taste of it this week when Chancellor George Osborne detailed how he would save a modest £6.2 billion this year.

Even that provoked howls of anguish – imagine how much more unpleasant things will get when Mr Osborne has had time to go through the books in more detail.

Yet international aid is safe. Actually not just safe – the Government plans to spend more money on it than ever before.

This year we are spending £9.1 billion. Ministers may think that’s a small price to pay for keeping Bono and Bob Geldof off their backs.

And of course vast swathes of the world are impoverished. People are dying of disease and starvation. Everybody should do what they can to help.

Except that large sums of aid end up in the hands of corrupt dictators and murderous warlords.

If we can’t afford to spend as much on welfare and schools at home, surely we should spend less abroad as well.

Yet in the Queen’s Speech the Government promised spending on international aid would carry on growing.

The speech declared piously: “We won’t balance the budget on the back of the world’s poorest people.”

This self-righteousness “will place Britain in a position of clear international leadership, encourage other countries to live up to their commitments and generate momentum ahead of September’s UN summit on the Millennium Development Goals”.

That’s all very nice and fluffy and will help International Development Secretary Andrew Mitchell, MP for Sutton Coldfield, sleep soundly in his bed at night.
But why protect international aid? Why, for example, are we spending £40.2 million in China?

China overtook Britain as an economic superpower in 2006 and will be second only to the USA by the end of this year.

It may be an undemocratic, dangerously unstable abuser of human rights but a few million quid from little Britain won’t change it.

Especially when some of the money we spend in China goes on teaching children to campaign against climate change.

Britain’s biggest financial commitment goes to India, which gets over half a billion pounds.

We’ve all seen “Slumdog Millionaire”. We know the divide between India’s rich and poor is enormous.

But India is already the world’s 12th largest economy and will, according to experts, overtake Britain within the next five years.

India is so rich its top industrialists come over to here to buy up what’s left of our manufacturing industry. To them, we’re the Third World, not the other way round.

Naturally, we spend hundreds of millions in Pakistan but we can’t even get them to promise not to torture people.

We’re spending £79 million teaching conservation farming techniques in Zimbabwe – a country which bans the BBC because its dictator wants to hide how he is destroying it.

Aid for Zimbabwe farmers wouldn’t be needed at all if Mr Mugabe hadn’t allowed the farms to be over-run and destroyed by machete-wielding thugs. Our money is keeping him in power.

Then there’s the Pitcairn Islands (pop 50), in the middle of the Pacific Ocean, home to descendants of the mutineers who kicked Captain Bligh off his ship, HMS Bounty.

Our £2 million pays for a prison to house six men jailed for sex abuse.

True, we give money to deserving causes as well. Places such as Hungary and Croatia, even Saudi Arabia have all been beneficiaries of our generosity.

It may be there was a time when we were so rich we could afford to spread our money around like a drinker at the Last Chance Saloon. You’d have thought those days were over.

The Government is using foreign aid as a reasonably cheap way of extending its appeal to bleeding-heart Liberals. Britain is now world leader in giving away taxpayers’ money to undeserving causes around the world.

Even when it goes to countries in desperate need, there’s every chance it will only make matters worse.

International aid worth billions has poured into Sudan yet the country is starving. Civil war in Darfur has left two million people homeless and killed maybe 200,000. It’s home to Al Qaeda’s terrorists.

Britain spent £54 million on Sudan’s elections earlier this year – and they were even less free and fair than our own.

Spending cuts may be necessary but they will be hard and unpleasant. Ministers need to think again about those parts of the world where they want to lavish even more of our money. Call it mutiny on the bounty.

Prescott gets his just desserts

Good to see John Prescott joining the upper toffs after all these years. Give a class warrior a sniff of ermine and suddenly the workers can look after themselves. Champagne, comrade?

If the coalition isn't split it should be

Vince Cable claims the coalition is not split over plans to raise capital gains tax to 50 per cent – to which the only answer is that it should be.

What are the Cameroon Liberals playing at? A young entrepreneur told me today: “I feel very strongly about this.

“Eight years ago, I took a risk. I was offered a good, safe, extremely well-paid job but I set up my own business.

“If this tax rise goes through, even if my business goes as planned, I would have been better off taking the safe job – and I wouldn’t have had to spend the last ten years worrying about money and where the next contract is coming from.”

As my friend points out, using CGT to hammer people with second homes and a few shares will only leave them worse off and more likely to become dependent on the taxpayer in their old age.

Meanwhile the major buy-to-let landlords can afford clever advice to make sure they get registered abroad and probably don’t need to worry about tax at all.

There is a terrible irony here. It was a Labour Government which cut capital gains tax to 18 per cent only to discover the reduction was being abused by the very rich, who converted income to capital.

But it was still a good idea. It may need reform to prevent abuse – such as the re-introduction of a taper so you can’t cash in on short-term investments.

The point has to be, though, that long-term investment and entrepreneurial risk-taking must be encouraged by the tax system – not punished.

And if the Conservatives in Cameron’s coalition don’t understand that then we might just as well have voted Liberal in the first place.

Much as I loathe Alastair Campbell, it was pathetic of Cameron's "communications team" to refuse to put a Cabinet Minister on BBC's Question Time programme just because the former Labour spin-freak was on it.

Is there nobody in the Cabinet capable of taking him on? Is there nobody willing to defend the Government's first week of work just because there isn't a Shadow Cabinet Minister in attendance?

Much as I loathe the BBC, the corporation was quite right to refuse to be dictated to.