Vince Cable, the business secretary, is set to announce plans to part privatise Royal Mail in a move similar to that announced by Peter Mandelson some months ago. However, the structure of any potential deal will be slightly different in that the post office network will not be included as the government is only looking to take on a minority shareholder to raise additional funds for the development of Royal Mail.
Speaking at the CBI annual dinner, Chancellor of the Exchequer George Osborne launched a ferocious attack on the former Labour government's "reckless spending" in the last few months of office. The new coalition government has announced a review of all Labour spending decisions over the last few months with speculation that a number of senior civil servants were unhappy at the rate at which funds were being allocated to new projects.
As we await confirmation next week from George Osborne regarding proposed cost savings from the UK public sector of £6 billion this is certainly the first real test for the new Chancellor of the Exchequer. He has been relatively quiet over the last few days going through the UK finances with a fine tooth comb after being left a difficult situation by the Labour government. We have seen some announcements regarding proposed cost savings and the full extent of UK national debt but next week and the forthcoming budget will be vital to the reputation of George Osborne.
In what many believe will be a total restructuring of the UK public sector it has been revealed that the police bonus system is to be reviewed, a move which has been backed by Metropolitan Police Commissioner Sir Paul Stephenson. Sir Paul, who is said to have turned down bonus payments of around £100,000 since 2005, believes that the system is flawed and potentially costing the UK taxpayer £40 million a year it needs to be reviewed.
As the new UK government continues to roll out facts and figures and comments about the previous government the truth is, no matter how it is wrapped up, there will be much pain in the short to medium term for the UK business arena and UK taxpayers, although hopefully this will lead to a steadier UK economy and prosperity in the longer-term.
There is intense speculation this morning as to who will suffer most in the forthcoming budget which is almost certain to see UK taxes increase in the short-term. The emergency budget, scheduled for 22 June, will give us our first glimpse of which way the UK coalition government will fall with regards to tax rises. So who will suffer most?
The in-coming coalition government has made a number of potentially controversial and potentially damaging claims over the last few days regarding the spending patterns of the last Labour government. There have been accusations of overspending, against civil service advice, there have been accusations of tinkering with official debt figures to give a potential better picture as well as a number of other hard-hitting comments. So did the previous government act against civil service advice in the final throes of its tenure?
As the UK government readies itself for an emergency budget on 22 June what can we as UK taxpayers expect to hear?
Even though the UK government is set to confirm £6 billion in public sector investment cuts on 24 May it is likely we can expect further public sector investment reductions to be announced in the budget. Many people also believe we will see an increase in basic VAT from 17.5% to 20% as well as a potential adjustment of the income tax-free band for those working in the UK.
In a continuation of a previous Labour government policy, the Vince Cable is looking to target tax avoidance schemes in the UK and around the world to ensure that the UK government receives tax payments due from UK operations and those domiciled in the UK. Over the last two years we have seen significant progress in the field of closing down tax avoidance schemes and tax loopholes and this would appear to be something which the coalition government is keen to continue.
George Osborne makes his way to Brussels tomorrow with the intention of blocking a new EU hedge fund directive which many believe will make the City of London less competitive. Many people blame hedge fund and similar investment vehicles for the volatility in worldwide stock markets over the last two years and new regulations appear almost inevitable. But can George Osborne block or water down the current EU hedge funds directive?
