Be Excellent To Each Other

Gosh.

Excellent stuff.

I reckon the real reason is nobody knows how they work so decided not to try to unpick it

Stretches my definition of excellent considering it was a situation completely of his own making, but I welcome the news.

Interesting that despite implementing a welfare cap he's already saying it's been breached.

Having the balls to climb down from a bad position is pretty excellent. It's the same reason my respect for Gove has gone up hugely due to him spending his entire tenure as Justice secretary dismantling all of Grayling's ludicrous policies.

Yeah, Gove was a dismal education secretary but he's done some good work so far as Lord Chancellor.

LOOK AT A BIPARTISAN POST I MADE

Wow, George Osborne's own words!

http://www.publications.parliament.uk/p ... 6-0002.htm

So this means he has failed to control public expenditure, by his very own standards. Good to know.

He's still forcing councils to sell high value social housing with no prospect of replenishing the housing stock. It's literally the opposite of a sustainable solution.

Another can of worms perhaps, but no doubt part of this thinking is that there really shouldn't be "social housing" in Kensington, Chelsea, Mayfair or wherever that's worth millions of quid per plot, that money should go back to the taxpayer thanks very much.

I'm all for ploughing this back into new social housing in much cheaper areas of London (even then, most low and even middle earners could only dream of buying new properties in such places), and I'm quite sure this isn't happening, but still doesn't detract from the ridiculous "I can't move from this area I grew up in" tosh where multi-million pound de facto council houses for the very fortunate few are somehow supposed to be justified.

We'd all love to live in well-to-do parts of London in social housing at giveaway rents (or better still, be put up in such housing in perpetuity), but sadly it ain't on the cards. Move to a cheaper area you can afford like the rest of us.

Ah, good old social cleansing!

Ah, you mean Not-London.

More seriously, it's not all million pound houses in Chelsea that we're on about. That's really a distraction. Councils need to house people, and this will make it harder for them when they sell off all their assets to pay for waste collection. The following year there will be more strain on the housing sector, more strain on all the areas that were subsidised by the sales, and the council will still be expected to make further cuts!

It's utterly inevitable that this has negative consequences for society, apart from those far enough from the bottom. Even Cameron can see this as he keeps on moaning about the consequences of the cuts he endorses!

I grew up here:

https://www.google.co.uk/maps/place/Ber ... b81d0de7ed

Currently very expensive luxury flats, but until about 5-10 years ago accommodation for police officers with families. The people in the blocks around were typical upper working class, lower middle class. 5 - 10 minutes walk away from some of the most expensive property in London, but also 5 - 10 minutes away from scruffy bedsits, council houses, sheltered housing and the like.

I am not sure how many of those council houses and sheltered housing places still exist. But my dad on a police constable's salary, and my mum on a childminder's salary were able to afford to live there quit comfortably. The last time I check Berkeley Homes cheapest flat was £1.8 Million and that was for a studio. I don't think a policeman/childminder could afford to live there any more.

One of the main reasons I left London 15 years ago was that I could not afford to live in an area where I felt I could get my kids (well my one son at the time) into a decent school.

Basically London will be nothing more than a tourist attraction and a playground for the super-rich unless something is done sooner rather than later.

So I'm fucked then.

Osbourne says he's raising the cap on the small claims limit to £5,000 effectively closing most personal injury law firms and creating industry wide unemployment.

The saving made: up to £10-40 on your insurance. Maybe. Assuming that the insurers pass on the savings to you like good little boys. Oh what, premiums have gone up since the last time the personal injury market was slashed in April 2013 after the insurance sector promised to pass on the savings to the consumer. Well, at least you won't be spending money on unemployment benefits from all those staff in the personal injury firms recently made redundant since those jobs won't be absorbed elsewhere in any firms as there's simply not enough work. Oh you will? I see you've thought about this thoroughly and not just been paid off by the insurers.

And what has the small claims track got to do with the savings review anyway? Private individuals suing insurers has nowt to do with how you distribute your purse.

Thanks Tory cunts!

Um, no. They've only just started to rise again after a steady decline over the past few years.

Obviously the rest of your post I know little about, other than "shit. That sucks."

The reforms came into effect in April 2013 and it was said at the time that the reductions in premium would take a while to come into effect since lots of cases would still be assessed under the old, more expensive rules. The reforms in April slashed legal costs payable in a big way and led to closures and redundancies across the board. So with just over 2 years of the new rules premiums have increased. There's nothing I can see in my post that was incorrect as premiums have increased since the April reforms; not an increase from April, but since the reforms came into effect, and funnily enough around the time that you might have expected the insurers to start seeing some big savings.

NHS spending is through the roof because, in part, they cannot hire permanent staff and hence have to plug staffing gaps with expensive agency staff.

Ben Goldacre did a little study. He picked the NHS hospital that spent the most on agencies last year (somewhere in central London), drew a circle around it that was 45 minutes out, and added together the annual salaries of two mid-career NHS nurses. Then he looked on RightMove and couldn't find a single house in his 45 minute radius the nurses could afford.

It's only one data point, but there's others I've written about previous, like Deutsche Banks. The upshot is it's becoming difficult to recruit normal paid workers in London, across private and public sectors. The wheels turn slowly on this stuff, so we're only feeling the earliest of the knock on effects, but I think there's more to come.

http://www.theguardian.com/politics/201 ... ge-osborne

McDonnell is an idiot

It was certainly a little ill advised, but John Bercow's comment about "I want to hear the contents of the book" was hilarious.

What in the name of God can be done about that, though? Historically a nice big war would fix things, but that seems to be unlikely to happen.

(edit: I mean housing prices, not nurses in particular)

Rent controls?

Don't force the councils to sell the few non-private residences in an expensive areas for a infinitesimally small and short benefit?

I'd also mention that there's an important distinction to be made between "key worker" housing development schemes, which seem at least partly justifiable to me under certain circumstance, as distinct from general "social housing" which includes anyone and everyone, including the long term unemployed.

I'll be shouted down for sure, but why the hell should the taxpayer forgo a very nice return from the sale of these houses, just so we can keep people who are not key workers, and quite possibly not even full time workers or working at all, as living in very expensive areas for years, when said monies could build 5, 10 or 20 new flats in a cheaper area? Just how "fair" is that, when the waiting list's as long as my flippin' arm?

Still I suppose it's "social cleansing" or whatevs, I need to be reprogrammed.

I'm not convinced that would achieve much at all.

I guess I don't know what a key worker is. Is it a nurse, or a teacher? Is it the bus driver who drove the nurse to work this morning? Is it the barista who made the nurse's morning coffee, or the Subway sandwich artist who made their lunch? Is it the police station's admin staff? Is it the taxi driver who drove the admin assistant home last night, or the bartender who made their drinks, or the cleaner who cleaned the pub this morning? Where do you draw the line through a city and say "yes, these are the 10% who are vital, and we can do without these others" when a city is a fabric of people, most of whom are making somewhere around minimum wage and looking at a property market that starts at ten times their salary and all need help?


Even Krugman, as left-wing a Nobel economics laureate as you could hope to find, thinks rent control is a bad idea. Rent control constricts supply and means there are as many people chasing fewer places, but prices can't rise so you get fucked up consequences. I chatted about this recently to a few colleagues, one French, one German; both countries with strong rent controls in many urban areas. Renting there involves a level of background checks we would associate with applying for a job with MI5; credit checks, personal references, employer's references, dress nicely, turn up early, camp overnight outside the property so you're the first to see it, etc etc. I'm not convinced this is a solution.


Bite the bullet and build so many new houses that prices actually fall to affordable levels; you'd have to about halve them to be even close to historically normal levels. In the process, commit electoral suicide because everyone has spent the last 20 years planning retirements around the values of their houses going ever up-and-to-the-right. Or, as this government is doing, attempt to walk the line, putting in shared ownership schemes and first-time-buyer-only incentives that attempt to get people on the ladder without affecting anyone else. At best, though, I think this only gets people a tiny one-bed flat they can barely afford, and no mobility to move to anything bigger or anywhere else in the country; I don't see how this fixes much of anything.



London first time buyer property prices are now approaching 10x average earnings; over the last 25 years, house prices are up massively but earnings are almost unchanged thanks to the recession. Now, dwellings have an intrinsic value; people need to live somewhere commutable to where they work, and they are prepared to pay for that up to a point -- up until it's so expensive they can no longer afford it. That's (in an economic sense) the fair market value of the property.

But... if investors see prices going up 5% or 10% year on year, they want a piece of that. So they buy stuff, and they have deeper pockets than people looking to live, so prices rise. Then other investors see prices still going up, so they want to get in too, so prices rise some more. And more.

What do we call it when investor speculation makes something's price increase far beyond its intrinsic value? Why, that'd be a bubble, and we all know how that ends. As soon as investments slacken off, it causes investors to retreat from the investment, which is hard with something as illiquid as property so might trigger a panic (or, in polite economics terms, a "price correction.") In London's case, the investors are largely foreign, and there seems to be no end to the foreign money coming in. I see one of three outcomes. (1) something changes, like the recent China stock market crashes, that triggers a crash here. (2) This continues and we quite literally break London as a functioning city. (3) We start to make cautious moves to curb price raises and have a controlled correction, which is hard-to-impossible and probably just causes (1).

To be fair though, in the short term at least if the investors genuinely are all foreign then it would be a win win if this was a bubble that would burst in the medium term horizon. Lots of lovely foreign cash flows into the uk in the form of tax, stamp duty and sales prices to uk people who are selling to them, then we buy all the houses back on the cheap post crash. The more fundamental risk then is that the crash doesn't happen and rents/prices stay high to give rise to route 2

Anyway, I've never been so bored shitless on budget day. I could have written all our outputs by now and I'm still waiting for review versions from other people. Dicks, and I predict none of them will rant about Apprentice (not at all a national insurance increase as that would be illegal oh no) Levy.

With my cynical head on, I'd say that this could have been predicted. Threaten something totally controversial with no actual intention of implementing it,then everyone will say what a jolly good chap you are when you do your U-turn.

As someone who is renting in London, on a purely selfish level I am of course praying for (1). It's about the only way it makes economic sense for us to stay here, and I'm saying that as someone on a pretty decent salary.

Things aren't great in the rest of the county, either. As the graph above shows, first-time-buyer to earnings are very high country wide, even if they are less berserk than they are in London. Prices in hot areas are back around the 2005/6 top of the market level. Even in my humble little town in Wales, the house I bought in Jan 2006 sold in May 2015 for 98% of what I paid. However precarious the market was in 2006, it's not obviously much more stable now.

Part of me thinks this budget was the first part of Osborne's leadership campaign for 2020. Abolish the incredibly dangerous-to-his-image welfare cuts and throw a sop to Generation Rent, who are increasing in size and increasingly angry. Feels like a calculated move that it would cost him too much electoral goodwill when he comes up against Johnson.

Except his expression when the Lords blocked him showed he was serious.

The more Machiavellian explanation was that some of the big, big promises in the Tory manifesto were overstated with the idea they would be bargaining chips in coalition agreements; and then they won an unexpected majority and had to walk some of them back. Doesn't feel likely, to me; too pat an explanation. But we have had a number of significant retreats, including austerity today and the Human Rights Act reform that was abandoned almost immediately after the election.

He was serious then. A week's a long time in politics and there's been a tide of public opinion against the welfare cuts building in the meantime. Maybe it finally reached a tipping point in his calculus.

Politics is a complex, sneaky and dirty game.

We make them climb a filthy ladder to get there, then complain they've got dirty hands.

Ooohhhh profundity!

Plus I don't think it's necessarily true either, the mass media and the stupidity of most people have a lot to answer for.

He's very clearly going for big headline vote grabbers. Apparently there's a lot of small print on stuff like councils getting fucked over, but his main win was the OBR giving him a free 32bn.

Yes, they are additional factors, but if it wasn't so complex, everything in the garden would be rosy, wouldn't it, and we'd be living in Utopia.

They should keep their ladders clean, like what I tell my trainees when I'm running Working at Heights courses.

Feck me just seen the Chairman Mao despatch box special on the news.... If I was a Labourite I'd be crying into my beer. Face palm hardly covers it what a total bellend

Ideally social housing would be the regular rental housing in this country, as it is essentially in many European countries. That coupled with rental controls, of course. (Think of the advantages - lower housing benefits bill for the Exchequer, more people able to save up deposit for a mortgage, no more parasitic buy-to-let landlords endlessly pushing up house prices...)

The housing market here is as fucked and inequitable as healthcare provision is in the States, and it's being deliberately kept in this situation needlessly for similar reasons.

It's not really deliberate or needless - as Doc linked to on the previous page, rent controls wouldn't really fix things, and what other solutions are there?

As long as all these social housing things aren't near a school where Cap'n Shitpants is going to go, I am fine with that. We'll move in a couple of years into the catchment area of one of the good secondary schools.

Incidentally, £33k per annum is needed to get an 80% mortgage for a place in Bradford. £12k over average wage.

I don't see how buy-to-let landlords can inflate housing bubbles, because as a straightforward business proposition they are as tied to the intrinsic value of property (ie. what they can afford to charge as rent) as anyone buying a house to live in.

Where it gets complicated is where a BTL landlord is also an investor; the rent maybe covers the mortgage, but delivers no return. The return that justifies the hassle is assumed to come from rises in house prices. But they are just as vulnerable to the bubble popping as any other investor, because most of them are mortgaged to the hilt. If rents fall even a little, so they no longer cover mortgage and other outgoings, and prices fall to put them in negative equity, then I think we could see a real bloodletting in London.

Looks like Osborne is considering selling off some or all of the Ordnance Survey. I'm not against private investment per se, but I'd oppose anything that risks the ending of their paper map range. From a business mindset those would be the first to go as they aren't where the profits.

If it weren't for buy-to-let folks, lots of people that couldn't afford to buy a place would be homeless.

Not to mention those pesky migrants that can earn good wages, but struggle to get any kind of mortgage.

Weird, most people I know involved in it seem to regard it as a fairly piss easy way to make even more money if you have some spare cash knocking about but over the last day I keep hearing that buy to let landlords are somehow selflessly serving the community.

I considered buying a place and renting it out. However, my back of fag packet calculations suggested it'd end up being a lot of effort for the monthly return, so I coyldn't be bothered. I was probably wrong.