As the UK coalition government sets about targeting up to £60 billion in budget cuts David Cameron has announced what will effectively be an open forum with the UK public. He recently visited Canada where the Canadian authorities also underwent a similar task some years ago whereby the public were involved in targeted budget cuts which appeared to go down well with voters. Will David Cameron use the same tactic in the UK?
Over the last few days we have seen a massive charm offensive by the UK government in relation to the UK financial position and the expected explosion of public sector investment cuts in the short to medium term. We are seeing all of the figures revealed into the public domain and there is no doubt that the UK government is making the situation look "as bad as possible". So why is David Cameron doing this?
In a very controversial move Winton Rossiter, the founder of Weight Wins, has suggested that the UK government should look at his scheme which pays people to lose weight offering the potential to save billions of pounds of NHS spending in the future. The scheme, which was sponsored by the NHS Eastern and Costal Kent, saw 402 people enroll with those being "paid" to lose weight having lost nearly twice as much as those who were not paid.
David Cameron has today cleared the decks of the UK financial situation by confirming that UK national debt will increase to a staggering £1.4 trillion over the next five years. His estimate that interest charges alone will peak at £70 billion is another staggering fact which many in UK will be totally unaware of. There is a feeling that amidst the anger and shock about the figures in question David Cameron will attempt to push through the biggest overhaul of UK public spending ever seen.
As we approach the first coalition government budget on 22 June there is intense speculation that the government would increase the basic rate of VAT to 20% and possibly extend VAT to items which are currently exempt. However, the British Retail Consortium (BRC) has attempted to join the fray with a suggestion that an increase in VAT to 20% could cost over 160,000 jobs and extract £3.6 billion from UK consumer spending over the next four years. But what are the options for David Cameron?
David Cameron has opened up UK government books to the public today in a statement which will horrify the vast majority of the UK population. It is estimated that the UK sovereign debt will touch £1.4 trillion over the next five years which equates to £22,000 for every citizen in the country. If this isn't bad enough the government is also predicting that annual interest charges on the massive debt will peak at £70 billion in the short to medium term!
There are a number of potentially hard-hitting and expensive tax changes set to come in over the next few months, if we can trust the rumours in the market place at the moment. While many experts are advertising services for consumers and businesses which would attempt to avoid the potential increase in taxation in the short-term, nobody actually knows what these changes are for sure at the moment. So is it dangerous to look ahead?
George Osborne has been attending the latest G20 meeting where the focus has shifted from financial stimulus to austerity. There has been a loud call for all governments around the world to rein in their spending plans and budget deficits to try and rebalance the worldwide economy. It seems that world leaders have now recognised the fact there is no bottomless pit for a long-term fiscal stability program and budgets need to be reduced immediately.
There is trouble brewing in Scotland as the Scottish CBI and a group of entrepreneurs and academics (allegedly linked to the SNP) have clashed with regards to extended taxation powers for the Scottish Parliament. Despite the fact that the CBI in Scotland represents 26,000 members this group of entrepreneurs and academics is accusing the CBI of being out of touch in its reluctance to fully back the move for greater fiscal powers in Scotland.
The UK government is today said to be reviewing the proposed increase in capital gains tax amid concerns it could cost up to 61,000 jobs and up to £4 billion. These figures have been calculated by the Adam Smith Institute, a financial think-tank, and now offer something of a very real problem for David Cameron and his government colleagues.
