Archives for category: General

“You don’t know what you’ve got ‘til it’s gone” sang Joni Mitchell in ‘Big Yellow Taxi’, so does that apply to economic growth, a staple of the 1990s and earlier 2000s, significantly absent from the UK economy in the past 4 years? I will return to Joni in due course (she is a music legend, younger readers).

The CBI tells us that the UK economy will contract by 0.3% in 2012, having undergone three consecutive quarters of shrinkage, one more than is needed for an official recession. The Treasury response to Labour criticism of government economic performance is interesting:

“Growth in the year to date has been disappointing, but despite the difficult current conditions employment is rising, and inflation has halved since its peak last year.”

Now apart from the fact that one would damn well hope that inflation was falling in a recession, this would sound to a proponent of a high economic growth strategy a little like the apocryphal question:

“Apart from that, Mrs Lincoln, how did you enjoy the play?”

The British Chambers of Commerce come in at 0.4% with their shrinkage forecast, recommending cuts in benefits, the state pension and the civil service, and asking for a ”large and well thought-out infrastructure programme”  financed by government borrowing. This is something of a departure for the BCC, not usually renowned for its Rooseveltian characteristics, but here advocating something akin to Franklin Delano’s 1930s New Deal, which dragged the US up by its bootstraps after the Great Depression.

The BCXC also expects that the structural budget deficit will only be eliminated by 2019-20, as opposed to the government’s target date of 2016-17. However, its most innovative suggestion was for the Bank of England to purchase the debts of small businesses, as well as supporting small business borrowing. The Bank of England as debt factor is not a suggestion I have seen before, I must say, but this would certainly be a different way of putting cash into the economy.

The main reason for the recession is a 3.9% slowdown in the construction sector. Despite news of a surprise hike in prices at the luxury end of the market, the housing market in general is still depressed, and government spending on infrastructure and social housing has declined dramatically. And obviously the big Olympic building projects are now complete, which has not helped the sector either. It is for this reason that the BCC is so keen on a large infrastructure programme.

Manufacturing industry is also a problem, with paralysis in the Eurozone a major issue, along with general lack of confidence.

In a recent post I pointed out the alternative model of a zero-growth, sustainable economy, which is an alternative long-term objective put forward by the environmental lobby. So I thought it would be interesting to see what the proponents of the two alternative economic models have to say, by way of considering their respective merits in economic strategy terms.

Proponents of growth – arguments for economic growth

Jonathan Portes, director, National Institute of Economic and Social Research:

“In the long term, we grow because technology gets better and we get better at producing things. In the short term, growth is an indication that the economy is producing as much as it could be and resources are not being needlessly wasted. At the moment we are producing considerably less than we could be because the economy is being mismanaged”.

“Debt matters because it has to be paid. Growth would make it significantly easier to deal with. If we are growing slowly it gets worse and worse”.

So my concern with the fact that successive governments are institutionalising personal debt, by sending more teenagers to university and saddling them with large student loans, is therefore justified on this basis. Add in mortgage and credit card debt and this becomes a massive problem for society.

Professor John Van Reenen, London School of Economics:

“If the economy is growing at less than around 2% a year then unemployment rises because output is just not rising fast enough. With a growing population and rising wages, the economy has to grow to create jobs”.

“When gross domestic product (“GDP”)  grows, the size of the economic pie grows. That allows you to slice the pie to get what you want, be it higher wages, more leisure time  or increased government spending.”

Presumably this need for growth to sustain employment is also partly a factor of technological advance, which will typically reduce the requirement for labour in the production process.

Japan is the classic example of a zero growth economy, having achieved no real growth for almost 20 years; a dramatic contrast to the vibrant Japanese economy of earlier post-war decades. Janathan Portes says Japan finds it difficult to offer young people decent jobs, although he accepts that it is not a broken society, which may of course say more about Japanese social structures that the desirability of zero growth as an economic model in all cultures. It also has a 20% debt to GDP ratio, the highest in the developed world.

 

Proponent of zero growth – arguments for zero growth

Brian Czech, president of CASSE. The Center (yes I can spell, but it is American) for the Advancement of the Steady State Economy, says that the UK economy has already grown beyond its optimum size, and that further growth would create social and environmental problems that would outweigh its benefits:

“There are too many problems caused by increasing production and consumption of goods and services. Lots of sacrifices come with growing GDP, such as working too long hours, the depersonalising of workplaces and spending on advertising to persuade people to buy more and more junk they don’t need”.

And then of course there are the environmental costs associated with the constant drive for growth, and the consequences of using up more and more scarce resources, to the potential detriment of future generations.

The core of the argument for zero growth, however, is sustainability; the on-going achievement of a level of economic performance that does not threaten the earth’s environmental well-being or the levels of its scarce resources. That does require, however, the earth’s population to accept that certain things that have come to be regarded as necessities might have to be re-categorised as luxuries; I am thinking of air travel, and maybe ultimately even the internal combustion engine. And to accept that certain things may get much more expensive; apart from the above examples, the generation and consumption of energy springs to mind.

When the point is reached at which concern for the future of the planet outweighs concern for an individual way of life, decisions on environmental issues will start to look very different. But in the meantime it is an uphill struggle to argue for a zero growth model, which some might characterise, unfairly in my view, as turkeys voting for Christmas (I would argue that it is actually turkeys voting for the postponement of Christmas). Thus for the time being the drive for growth will continue, but if it continues to stall then serious questions may need to be asked about what are realistic economic objectives for the future.

To come back to Joni Mitchell, as promised, Big Yellow Taxi went on:

“They paved paradise. And put up a parking lot”. Is there a metaphor there about the drive for growth and the impact it has on our world?

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“When sorrows come, they come not single spies, but in battalions”. Shakespeare might almost have been thinking of the coalition government when he coined this particular one of his many memorable phrases.

Latest to let loose on George Osborne are Ryan Bourne and Tim Knox of the Centre for Policy Studies, in their less than snappily titled report “A Distorted Debate: the need for clarity on Debt, Deficit and Coalition Aims”. And they are not very complimentary.

The stated aims of the coalition for the UK economy on entering office in 2010 were to eliminate the current structural deficit by 2015 and stem the increase in public debt as a proportion of GDP. Nothing let setting hostages to fortune, as Gordon Brown found with his “Golden Rule”, although he did move not so much the goalposts as the playing field to ensure that he continued to meet it.

The deficit has fallen by around a quarter since 2010, but on a cyclically-adjusted basis (no, don’t worry, I don’t know what it means either) it had only been reduced by 13% by 31 March 2012. This had only been achieved to a limited extent by spending cuts (only 6% of the planned current spending contraction has been implemented), the great majority of the reduction having come from reduced investment spending and tax rises.

The official national debt forecast, meanwhile, is forecast to rise from 53% of gross domestic product in 2009-10 to a frankly terrifying 76% in 2014-15 – an absolute rise of £605 billion over the life of the Parliament. Not a lot of stemming going on there then, with high government borrowing and poor growth figures offering no consolation.

Intriguingly, the report also finds that the public has no idea what the government is trying to do or indeed whether it is succeeding. I will manfully resist the obvious cheap shot and content myself with saying that this might well be a relief to the government. The public is apparently very good at confusing the budget deficit and the national debt; of course in order to reduce the latter the former needs to be a surplus not a deficit, and we really are nowhere close to that situation.

Of course the government faced a Sisyphean task (he was that ancient Greek bloke who was condemned to push that rock uphill – presumably a task equivalent to being the modern Greek Chancellor) in trying to turn around the UK economy, which as Nick Clegg recently intimated is a long-term rather than a short or medium term project. But governments which don’t deliver on the economic front tend not to have a long-term. With another of the pieces of unintentional black humour that have been a feature of this week’s otherwise gloomy economic outlook, co-author Ryan Bourne says:

“With the recent dreadful borrowing figures, now would be a good time for the coalition to re-state the scale of our fiscal problems, and to set out how they will be addressed. Only by having a clear knowledge of the problems and solutions on offer from the different parties will the electorate be able to make an informed choice in 2015”.

Cynicism might lead me to say that the last thing the coalition needs right now is for the electorate to have a clear knowledge of the problems, particularly given that its solutions do not currently appear to be working. And it would be fantastic if someone came up with a clear set of solutions to our mounting economic woes, but I’m not holding my breath. Now if the politicians were to come out and say “we have no idea how to get us out of this mess” that would be refreshing (if scary), but that isn’t the kind of thing that politicians say, even when it’s true.

I should start this post with a disclaimer; although I studied a lot of economics, it was never a subject I felt entirely happy with. I think my problems stemmed from a suspicion that the subject was masquerading as a science, that the human factor in financial decisions multiplied millions of times meant that trying to predict how an economy would behave was doomed to failure.

That is not to say, however, that I do not respect those who do their best to interpret economic data and make some sense out of it. For my weekly dose of economic  theory, I rely on John Ashcroft’s blog “The Saturday Economist”; I encountered John as a charismatic chair of Pro Manchester SME’s Club hugely successful, informative and enjoyable event about Social Media, and he seemed to have a shrewd idea what he was talking about, and that is good enough for me.

However, for quite an upbeat character (they say opposites attract), John’s latest assessment of the UK economy is extremely pessimistic, and given that economic performance has an inevitable influence on future tax policy, his views seemed to be worth sharing and commenting upon.

The thrust of John’s argument is that UK economic  policy is based upon the objectives of growth in exports, output and investment, but in each of these areas actual performance is disappointing:

Exports

Although domestic demand grew by 3% in the second quarter of 2012 compared to 2011, this was largely fuelled by an increase in imports, which outstripped that in exports.

Output

This is still 4% below the peak of the first quarter of 2008.

Investment

The main contribution to growth in domestic demand was a 5% increase in government spending, compared to 2.2% growth in household expenditure and just 1% growth in investment.

Thus none of the government’s economic objectives are currently being met, but the position is in fact significantly worse when it comes to borrowing. This is up by 25% for the year to date, and forecast to be up by 20% for the year as a whole, threatening to match the record level of deficit ‘achieved’ in 2009-10. Public sector net debt was up by almost 40% compared to 2 years ago, with government spending on social security benefits and debt interest rising by 7%. Altogether an extremely gloomy picture, as noted by a variety of commentators, including the IoD, the CBI, the Chambers of Commerc e and a number of former Monetary Policy Committee members, all of whom have criticised government economic policy in the past couple of weeks.

Of course it is one thing to criticise and another to come up with solutions. The fact remains that the banking crisis and consequent massive spike in government spending have left a lamentable economic legacy. I would never claim to be averse to criticising George Osborne, but I suspect that better economic brains that his would be confounded by the need to come up with a workable solution to the economic ills of this country. Initial comment at the time of the bank bailout suggested that it would take a generation for the UK economy to get over the impact of the cataclysmic events of 2007/2008, and nothing that has happened since will have caused anyone to revise that view.

Nonetheless, we no doubt remain a nation that expects its political leaders to make silk purses out of economic sows’ ears, and is quite prepared to punish them at the polls when they fail to pull off that particular piece of financial alchemy. Of course the success of that strategy (I describe it very charitably) on the part of the electorate is dependent on there being an opposition waiting in the wings with an economic policy that promises something better.

That was clearly not the case in 2010, and no more is it the case, I would suggest, now. Ed Balls fills me with no more confidence than George Osborne as a putative Chancellor (although his surname offers some great punning headline opportunities) and spending our way out of a recession as deep as this carries the spectre of rampant inflation and what Gordon Brown used to refer to as “Tory boom and bust”. In which case what we have at the moment is presumably coalition stagnation , or perhaps coalition contraction is a neater phrase.

Although they would never be prepared to admit it, my pet theory is that politicians of whatever persuasion have not the faintest idea how to extricate the UK economy from the mess that it is in, any more than civil servants or economists do. The economic situation is unprecedented, and our close ties with a Europe wrapped up in the Eurozone crisis (a modern Greek tragedy, if you will) is hardly helpful at this particular point.

Which brings me to the radical alternative perspective on the zero growth economy. Predicated on the plausible theory that the constant drive for economic growth is the principal driver of the widespread damage that we as a world population do to the environment, and also accelerates the consumption of finite scarce resources such as fossil fuels, the logical extension of this theory to the current economic position would be to accept, indeed embrace, the formidable difficulties inherent in seeking to stimulate economic growth, and work instead toward a sustainable economy operating in equilibrium. On that basis, the argument goes, one really does put an end to “boom and bust”, of whatever political origin.

In the absence of any compelling evidence that traditional economic theory offers a way out of our current (apparently) long-term malaise, is this the time to consider the economic sustainability model? Of course it would require a deal of explanation to an electorate reared on generations of politicians who have treated economic growth as political nirvana, but it would offer an opportunity to come to terms with both economic and environmental realities at a time when the alternatives are particularly unappealing. So which politician is going to have the courage to first outline this post-growth economic vision? For whoever it is I suspect that short term criticism awaits, but quite possibly long-term justification. Is zero growth an idea whose time has finally come?

Back In 2011, when cynicism and negativity about the Olympics was rife, the Simpson family took a decision to apply for a large number of tickets for a wide variety of events. This was based on a hugely successful and enjoyable Commonwealth Games in Manchester in 2002, and on the fact that it would be a once-in-a-lifetime experience, certainly for us. Indeed, as I said to the children:

“If the Olympics takes as long to come back as it has since last time, you will both be in your 70s by the time it returns.”

So my stepfather and I between us applied for 27 events and got tickets for 10, which we supplemented to 13 with later purchases; we also attended two free events. My son was terrified about transport and crowds, but in the event absolutely loved the experience, as we all did. So here are my top 10 thoughts about the 2012 Olympics:

  1. 1.       Complaints about ‘hogging’ tickets

I saw complaints from people (once the Olympics was clearly a success) about people ‘hogging’ tickets; well that would be us, then. Some thoughts on this:

  1. We were prepared to put our money where our mouth was and buy tickets when many were prophesying doom and gloom.
  2. Many of our tickets were for low profile events – we saw only 5 medal events (paid for) and 2 free.
  3. We may have obtained some advantage in applying for low profile events because many of these were ‘kids pay their age’ events.
  4. Lots of people seem to have applied solely for high profile events and then sulked when they didn’t get them. We would have loved to get cycling, tennis, diving, equestrian and gymnastics tickets, but we didn’t throw our toys out of the pram when  we didn’t get them – we were happy to get what we did.

 

  1. 2.       Crowds

 One of my son’s big fears, and there were a lot of people, but there was a lot of space for them too, particularly in the Olympic Park. We never felt crushed or in any danger, and everyone was so happy and friendly it was a pleasure to spend time with them.

  1. 3.       Children

I think the greatest thing of all about the Olympics was the number of children who were at the events, of all ages, enjoying what I am sure will be an experience that stays with them for the rest of their lives. And the crowd behaviour was so good that parents like us were delighted with the example set of sportsmanship, consideration for others and sheer enthusiasm.

  1. 4.       Transport and travel cards

My son’s other big fear was also misplaced, as the transport system was amazingly good. We probably took a wise decision to base ourselves in Greenwich, as this meant that Stratford was easily accessible, with direct DLR trains every 10 minutes. ExCel was also accessible by DLR, whilst we could easily catch a bus that got us into central London in 45 minutes for more outlying venues. We only used the tube twice and the Thames Clippers once, and the Javelin train from St Pancras to Stratford was wonderful. There were few crowded trains etc and everything ran like clockwork.

The innovation of giving ticket holders free travel cards for days when they were going to the Games was a huge success, meaning that ticket collection and checking at venue stations could be dispensed with.

  1. 5.       Volunteers and security staff

What hasn’t already been said? They all looked like they were enjoying themselves, they were friendly and helpful, the security checks were superbly efficient and they set the tone for a happy and friendly games by their demeanour. Thank you.

  1. 6.       Free events

If you were miffed at missing out on tickets, there were plenty of events you could go to see for free. We saw the women’s triathlon cycling go past us 14 times on Constitution Hill and the women’s marathon go past us 6 times on the Embankment, on the front row each time. The crowds at both events were, I thought, extraordinary, until I saw on the big screen at Eton Dorney the crowds for the men’s triathlon, which were simply unbelievable.

  1. 7.       Hockey

I thought hockey at the Commonwealth Games was rather like watching paint dry, but at the Olympics it was brilliant. Maybe women’s hockey is better than men’s?

  1. 8.       Athletics

Hearing my daughter cheering on Mo Farah in the 5,000m heats was a highlight, but so was the whole morning. Apparently London was unusual among Olympic cities in selling out morning athletics, but I can’t understand why – always something going on and often 2 or 3 things at the same time.

  1. 9.       Handball

The great thing about the Olympics is discovering new sports. “You must go and see handball” said so many people that we did, and it was fabulous – fast, rough, close, spectacular – my son’s highlight of the entire Games.

  1. 10.   Swimming / Michael Phelps

Our one ‘high profile’ event was the last night of the swimming. 2 world records (2 more than I had ever seen before) and the last gold medal and special FINA presentation to Michael Phelps, who I suspect will remain the greatest gatherer of Olympic medals and gold medals for some time to come. Unforgettable! And as we came out the noise from the Olympic Stadium was incredible; spine-tingling in its intensity and getting louder as we got further away. That was Mo Farah winning the 10,000m, Great Britain’s third athletics gold medal in 45 minutes. Wow!

So my children, at least one of whom was dreading the Olympics so much, ended up collecting Wenlocks and Mandevilles and asking “can we go to Rio in 2016?” Wouldn’t be much of a once in a lifetime experience then would it? Anyway, they seemed happy with the counter-offer of Glasgow 2014 – much more exotic than Rio – after all, can you get a pint of heavy and a deep-fried Mars bar in Rio? Precisely.

 

Every year, in  August, I take a quick diversion from the world of tax to review the productions in the 24:7 Theatre Festival. This year my review is somewhat delayed by the fact that the Olympics followed closely upon the Festival (see following blog post) for which I apologise, but stretching the ageing memory bank more than usual I reckon I can still do a reasonable job. By the way, for anyone expecting absolute objectivity, I have an interest to declare as a trustee of the charity that runs the Festival, although as befits an accountant I am very wisely let nowhere near the creative process!

2012’s incarnation was the ninth annual Festival, and I have to say that the overall standard of productions just keeps getting better and better. For non-Festival goers, work must be previously unperformed, not more than an hour in length and capable of being performed in non-orthodox theatre spaces (this year two venues in New Century House and the Three Minute Theatre in Affleck’s Arcade). The quality was in my view greatly helped by the decision a few years ago to cut down the programme from 17 to 21 productions to 10, which means that plays have to reach a very high standard to get into the Festival. And boy did that show this year!

The Olympics dictated that I had to get my festival going in early this year, so on opening night I eventually found the Three Minute Theatre after an entertaining tour of Affleck’s Palace to see two productions:

  1. 1.       Firestarter

Apparently based on true events in Hull a few decades ago, this was the story of a teenage arsonist. The first half of the play featured the young man explaining how a troubled childhood led him into fire-raising, with a particularly chilling yet totally convincing description of the sensations that starting fires engendered in him. The second half found him having chosen the wrong house at the wrong time for his activities, as he had fallen foul of a man just released from prison, played as an all-too-convincing psychopath by Festival veteran Richard Vergette. Despite the best efforts of his plainly terrified girlfriend, Vergette’s character eventually inflicts sickening violence on the young arsonist.

Very powerful and convincing writing and performances, and an accurate introduction to a Festival that was to be long on gritty reality and relatively short of outright humour, although plenty of the ‘black’ variety was on display in other productions.

  1. 2.       My Arms

Second on the bill on Friday night was the compelling two-hander “My Arms”. This told the tale of an act of drunken driving and its far-reaching consequences for families of perpetrator and victim, in ingenious fashion from back-to-front. If this sounds like a recipe for confusion it wasn’t, due to an intelligent script and sympathetic performances. I felt that, having previously condemned drunk-drivers out of hand, the play gave an understanding of how easily the offence can be committed, and how it can then haunt the lives of all concerned. Powerful yet under-stated, in a festival that sometimes shouted to get your attention, this kept it with a subtle whisper.

  1. 3.       Loaded

I had not previously sampled the Festival during the day at a weekend, but this year needs must, so     to more familiar territory in New Century House (Pioneer Stage) for Loaded. The play centred on Chantelle, an oddly endearing if foul-mouthed teenager, sent as a last educational chance to see a Geordie social worker, who manages to work out what makes Chantelle  tick and make some progress with her. Meanwhile Chantelle has met an apprentice gangster who becomes her boyfriend, although the bigger threat to her well-being initially seems to come from her abusive stepfather, who rapes Chantelle, resulting in her becoming pregnant (Republican politicians please note).

The plot thickens as Chantelle catches her boyfriend with a gun, which she appropriates. All comes to a head when boyfriend discovers what stepfather has done, leading to an explosive and unpredictable climax from which some characters emerge more fortunately than others. I found I really engaged with and cared about the characters in this play, which was a tribute to some fine writing and acting.

  1. 4.       Goldfish

Next up on the Elphick Stage at New Century House was Goldfish. This was less immediately accessible than some of the other work on offer, but nonetheless rewarded the effort of keeping track of what was afoot. The play centres on two teenage girls from troubled families, who frequent a day centre on their estate run by a social worker who, whilst devoted to the children in her care, is concerned that this results in her neglecting her own child.

The male characters are a teenage boy, new to the estate, his family having moved down in the world, who befriends the two girls but is ineligible to attend the day centre with them, apparently on the basis that he and his family do not have any major issues, and a policeman new to the estate, whose enthusiasm for his role leads him into a potentially career and liberty-threatening situation with one of the girls. As his life implodes, the teenage boy sets fire to the day centre, having concluded that bad behaviour is the only way to get noticed

A moral story for our day dealing with the paving of the road to hell, the slightly unorthodox presentation of this piece did not detract from its power or its message.

  1. 5.       The Cell   

Sunday lunchtime and a final trip to Three Minute Theatre for a fast-moving piece centring on an unusual hostage situation in a prison, as a prison officer takes a wise-cracking Scouser hostage (not a situation that appears to unduly worry the prisoner), having assaulted a prisoner he believes to have been responsible for the suicide of a young sex offender. Revelations come thick and fast, including the fact that the Scouse prisoner has an impressive network of contacts and illegal hardware (“who do you think I am, 118?”) asks the prisoner in the next cell at one point, and rather darker revelations about the prison and the officer, including the fact that his son is accused of an under-age sex offence, and the officer has been ‘hung out to dry’ by his senior officer. Eventually the officer cracks, finally shattering the cool of the prisoner as he takes desperate action.

This was a real highlight, black humour contrasting with a tragic story line to make an absorbing play that flew past, usually a sign of high quality in my experience.

  1. 6.       The Interpreter, Home

Monday night and the Manchester Business Breakfast Club 24:7 trip, with record numbers of attendees for three productions, the first of which was an understated and compelling drama about the mystery of a silent Kurdish psychiatric patient and the student engaged to interpret for her. Of particular merit were the greys in which the characters were painted, particularly the keen young psychiatrist, anxious to help her patient in any way she can but concerned about hospital procedures, and the nurse, highly efficient but perhaps lacking in certain of the human qualities normally associated with her role.

The young interpreter goes way beyond her brief to seek to help the patient, eventually tracking down her long-lost son, who reluctantly re-enters his mother’s life at the denouement. The play particularly appealed as a triumph of unorthodox methods over the tried and trusted, and of persistence in doing  what you know is right when everyone around you is telling you it is wrong, and benefitted from wonderful performances, particularly from interpreter and patient.

  1. 7.       The Transit of Venus

Next up was one of my personal highlights of the festival, so good that I created another first and took my 11-year old son to see it subsequently (he greatly enjoyed it too).

The reason for taking my son is that the play centres on astronomy, as two Lancastrian amateur astronomers plot and witness the UK’s first passing of Venus between Earth and Sun, against the backdrop of impending Civil War, which has dark consequences for one of the astronomers.

Again this was wonderfully understated, with a touching depiction of the burgeoning of shy young love between the daughter of one of the astronomers and the other. The play also carried a strong moral message about the difficulty of steering a middle course when all around are extremists, and about the importance of sticking to your principles at the hour of crisis. A work for all concerned to be proud of.

  1. 8.       The Legend of the Ghost Shark

A rare comedy next, and a manic one at that. A writer moonlights from his day job as a food critic to take a commission from a shaman to write a legend that threatens to have dire consequences for the world. Also featuring a narrator conjured from the writer’s subconscious, an angry boss from his food magazine, a somewhat bewildered wife and two eccentric policemen, this was a chaotic hit and miss production that divided opinion among those I spoke to down the middle. Certainly it had the potential to bewilder if you did not throw yourself whole-heartedly into the writer’s bizarre world, but there was much to reward those who contrived to do so in the performances and (from time to time) the script. Ten out of ten for effort for all concerned, even if the execution marks were somewhat lower.

  1. 9.       Stars Are Fire

Tuesday night and another under-stated treat, a play about a widowed father returning to his native Northumberland, much against the will of his teenage daughter. She befriends her cousin ( a touching and rather innocent relationship), and as a result father and daughter come to a better understanding of each other. Apart from a large number of distracting scene changes, which might usefully have been cut down, this was a subtle piece of work dissecting what makes families tick, and a very rewarding watch.

  1. 10.   All The Bens

Another highlight to finish with. Ben wants to start a relationship with Al, but Al is not really interested. Ben’s autistic cousin Henry hits it off with Al, who finds himself drawn into friendship with Henry, but not keen on continuing to see Ben. Al’s somewhat bizarre behaviour finally causes his girlfriend to drop him, allowing him to come to terms with himself, and the fact that he is really called Ben.

Three excellent performances, particularly from the actor playing Henry, who brilliantly portrays Henry’s somewhat unusual take on the world. All in all a pithy comment on the mess we can make of our relationships and the unlikely friendships that can spring up out of nowhere.

So overall another excellent Festival, indeed I would go so far as to say the best yet. On an individual basis nothing to quite displace Concrete Ribbons as best ever play, but collectively an excellent programme. Surely 24:7 can’t improve upon that again next year, can it?…………..

The uninitiated have this strange opinion that accountants and accountancy are dull – personally I blame Monty Python’s Flying Circus. Well, actually for the most part it’s true, which is partly why I opted for the wild and wacky world of tax. Believe it or not, some funny things have actually happened to me during my career in tax. I’m was going to go for a top 10, but that was too ambitious, so I have included three things that happened to people in connection with tax but not to me personally.

The ones that involved me

  1. My Italian client from London was coming to Manchester for a meeting with the taxman. We had never met and I was picking him up from the airport. “How will I recognise you?” he asked. “That’s easy. I’m the tall blond ugly one with the glasses and the chin” I replied. “Oh yes,” he responded “I’ve seen your photo on the website”. Check out the Lanky picture (link) if you don’t believe us!
  2. The staff of a previous firm  went out for the office Christmas drink on a Friday night, and one of the secretaries ended up accidentally (honestly) taking  a glass from the Hogshead pub in Manchester, which she made the terrible mistake of giving to our marketing manager. The secretary then became the victim of an elaborate practical joke, which featured the marketing manager’s brother posing as an agent for the fictitious Hogshead Glass Recovery Service and pretending to trace the glass to the secretary’s filing cabinet (where it had been planted) using a microchip in the glass.
  3. I was negotiating with Customs & Excise in respect of zero-rating for residential accommodation built by a Women’s Institute college. Crucial to the argument was the definition of a student, so I quoted the dictionary definition, which supported our case. A senior Customs officer replied: “Whilst these people may be students in accordance with the dictionary definition, it is by no means clear they are students in the everyday meaning of the word”. Not surprisingly given argument of that quality, we won the case (twice).
  4. After a long argument by the taxman that certain shares had been overvalued for charity share gift relief purposes, HMRC wrote to us proposing a value about 25 times higher than the one we had originally submitted.
  5. In 1997, when I was considering moving back north from Oxford, the Inland Revenue launched a major recruiting drive,  advertising for around 50 accountants. As I was clearly desperate, I spoke to my friend at Oxford tax office and found out who I needed to ring about the jobs, which had been advertised for around 6 to 8 weeks. When I called, it became clear within 2 minutes that they wanted ‘real’ accountants, not tax accountants, but he still kept me talking for about 45 minutes. In the end I asked how many people had applied. “You’re the second” he responded.
  6. In Oxford I had two clients who were adamant that they should be treated as self-employed, despite being directors of a company. Having told them until I was blue in the face that the Inland Revenue would never accept that, I finally got them to put their money where their mouths were and said I would ask for a status ruling for them from the company’s PAYE district.. After a long delay, back came the reply that they were indeed self-employed. Almost speechless with shock, I called the company’s corporation tax inspector and asked what I should do. After some research, he told me that the PAYE district had been embarrassed by the amount of time it had taken them to reply, and had thus ruled in the client’s favour, thereby helpfully making me look a complete idiot.
  7. My friend Andy at my old firm in Devon felt that a particular client bill looked a little high, so took a tip from solicitors down the ages and made reference in the bill to ”‘extensive telephone conversations”. Unfortunately his secretary, who he later married, so no hard feelings, typed this as “expensive telephone conversations”. Sadly Andy missed this while reading over, and even more sadly the client agreed!

And 3 that happened to other people

  1. Lester Piggott apparently paid the tax, interest and penalties on a concluded investigation into undisclosed foreign bank accounts with a cheque from another undisclosed foreign bank account. He deserved to get locked up for stupidity, I guess.
  2. A well-known tax lecturer left the Inland Revenue Shares Valuation Division for a job in the profession. Shortly after his arrival he was given on e of his own letters to reply to.
  3. A nervous young  tax barrister was appearing in the Court of Chancery for the first time before a rather imposing senior judge. The barrister’s wife had just gone into hospital to have their first child, and the barrister needed to request an adjournment so he could attend. Shaking visibly, he rose and said “Your honour, my wife is about to conceive and I need to request an adjournment.” Looking quizzically at the barrister over his glasses, the judge replied “I think you mean give birth, but in either case I think you should be there.”

Having children concentrates the mind. It gives you a longer term perspective on things. Sometimes this can actually be useful in getting things across to the children themselves. Take the Olympic Games. When my wife and I thoroughly enjoyed the Commonwealth Games in Manchester, my son  was 18 months old and my daughter not even a speck on the horizon. My son might have been to a hockey match and a badminton session, but not surprisingly he doesn’t remember it! Actually this is just as well, as he spent most of the hockey match pushing me down a hill outside the stadium and giggling, and had just settled down for his lunchtime nap at the badminton when he was awoken screaming by some very noisy Scottish supporters.

So when we announced that we intended to apply for lots of tickets for the London Olympics, the reaction, particularly from my son, who doesn’t like crowds (on reflection, possibly due to his experience at the badminton!) or the out of the ordinary, was not necessarily positive. Trying to convey what a once in a lifetime opportunity this was, I told them “if the Olympics takes as long to come back to the UK as it has been since its last visit, you will both be in your 70s by the time it returns.” This hit the spot, and next thing I knew they were making (long) lists of sports they wanted to see. Hence our forthcoming 10 day trip to London and tickets for 12 events – yes it was us who got all those tickets in the ballot!

Another aspect of this long term perspective is concern for the environment. I have in the past been guilty of driving vast numbers of miles, but in autumn 2010 I sold my car, so the family gets by with one. And that never goes any further than about 10 miles away, where my wife works.  If we go any further afield, to see family  in Devon or Oxfordshire or to take the children to London, Chessington World of Adventure or Legoland, we go on the train (a family railcard is a wonderful thing).

Now we know we are very lucky that the Greater Manchester public transport network is excellent, both in terms of getting around within the area or further afield for business or leisure. But as middle-aged spread threatened, and my 50th birthday loomed large, I went a step further, and began walking to the office from Hale and back again, a round trip of some 13 miles. Oddly enough this does not involve getting wet as often as you might think (except this summer) and has opened up some opportunities to raise money for charity.

Thus in 6 months last year I lost 3 stone to raise money for our local church, All Saints Hale Barns, and next year I have promised to walk the 225 miles of the Trans Pennine Trail (not to be confused with the Pennine Way) for After Adoption, another local charity.

Keeping an eye open for matters environmental also brought to my attention the St John’s Sunshine project near the office in Old Trafford, a ground breaking scheme whereby St John the Evangelist parish centre has installed solar panels and formed a co-operative to finance them and raise money to fund local community projects. If only our own church roof didn’t leak on such a regular basis I might be tempted to suggest something similar in Hale Barns.

Even the children have (to some extent) taken to the walking theme, provided the walk goes somewhere near a sweet shop! My son walked to and from the office with me last year and 5 miles around Stretford in between, although I was told he couldn’t walk the day after!

All of this has even had an impact on my business life, as I have taken a much greater interest in the significant and varied, if somewhat haphazard, list of tax reliefs available for environmentally friendly behaviour. This list will only get longer and less haphazard; indeed the EU has stated that within a generation it believes that environmental behaviour will replace level of income as the main determining factor in the incidence of taxation, at least on business.

So I have now walked the Trans Pennine Trail from Heatley to Cheadle, and the Bridgewater Canal from Boothstown to the M6 beyond Lymm (not all in the same day though!) at great benefit to my health and wallet, though at great cost to my footwear budget (I must walk very strangely, given where my boots and shoes always wear). I have applauded the courtesy of cyclists on the Bridgewater Canal towpath and cursed their (adult) counterparts who prefer cycling on pavements to roads. My carbon footprint is now much smaller than my shoe size (11) and only having one car is rarely a practical problem, this being largely a state of mind. Oh, and my poor deprived children have never flown, much to my daughter’s chagrin, although she tries to make up for this with her speed around cross country courses and athletics tracks.

So to anyone who aspires to improve their environmental profile, it can be done, with a little imagination and some willpower, and I would heartily recommend the benefits of a less hectic and stressful and more peaceful and reflective lifestyle. Next on the agenda is some research into the Green Deal, to see how we can make the house more carbon efficient, although I think a few car boot sales may be required to clear the loft before we go down that route, which could be difficult, because we only have the one small car……….

 Tempus fugit, particularly when you get to my age. Eight and a half years ago, Manchester Business Breakfast Club had a stand at the late lamented BEX exhibition in what was G-Mex. To the stand came a man with a plan, devised at the Edinburgh Festival in August 2002, to create a fringe theatre festival in Manchester, called 24:7. The idea was to have 24 plays performed over 7 days and nights in a week including 24th July. That man was David Slack, and the rest, as they say, is history. I was able to give David a few useful referrals to talk to people who I thought might be of assistance, and in return David and Amanda Hennessy did me the great honour of inviting me to be their co-director of 24:7 Theatre Arts Network Limited, the company formed to run the festival. On a shoestring, a wing and a prayer, the Festival first ran in 2004 with 17 productions, using an intriguing variety of non-theatre venues, which if I recall correctly included the Kings Arms and Black Lion in Salford, and Tiger Tiger and Babushka in the Printworks, the latter venue causing some excitement by going bust halfway through the Festival! Highlights I recall from the first Festival (before I got older and they all started to blend into each other) were ‘A Woman of A Certain Age’ and ‘The Heart is a Lonely Hunter’. I still have the proverbial T-shirt from the first festival, which is a goldish colour and also extremely warm for a T-shirt, which is probably a comment on Manchester’s prevailing weather conditions in late July (Jack Fingleton, the Australian cricket writer, suggested that Manchester had a monsoon in July. Having walked to and from work for the last 3 weeks, I agree with him!) Despite David at one stage a couple of years later that there would be no more Festivals, it has continued and gone from strength to strength, winning a MEN Theatre Award in its own right and also generating many MEN Award winning plays and performances. Through a successful few years based at the Midland Hotel (or whatever it is called this week) the Festival has now moved on to a base at New Century House, with the Three Minute Theatre at Affleck’s Palace also in use as a venue this year. Other past venues have included Walkabout, the bars at the Palace Theatre, the ill-fated Zavvi record shop (showing my age again), the (leaky) Sacha’s Hotel and a number of others that I am too senile to remember. From alternating between 17 and 21 plays in the first few years, the Festival has now settled down to a format of 10 plays, with a number of rehearsed readings and, this year, two visiting productions. The standard has always been very strong, and somehow or other seems to manage to improve each year. At the risk of betraying my faltering memory, I will pick out from the past 8 years the wonderful ‘Concrete Ribbons’ as my favourite production and my favourite performance the understated but thoroughly menacing gangster in the one-man tour de force ‘I am Frank Morgan’, who apparently so scared some of the audience that they didn’t dare talk to him at the end of the show! The Festival has stuck firmly to its principles of using only non-theatre spaces, accepting only new writing and restricting performances to an hour. This means that it is possible to see three shows in an evening, which I frequently do. In a number of past years I have seen all the productions, and the standard has been amazingly consistent and high. This year’s Festival runs from tomorrow to Friday 27th July, finishing neatly in time for the opening ceremony of the Olympics. Each of the 10 plays has 7 performances on two stages at New Century House and one at Affleck’s Palace. Go to see something in the Festival, and I suspect you will be hooked and want to see more, marvelling at the writing, acting and directing talent generated by this city and surrounding area. I will see you there!

 

After being more or less terminally ill for several months, Simpson Burgess Nash’s computer server finally breathed its last on Thursday, leaving us without a computer network on Thursday & Friday. As of this morning we will be in / on (?) the cloud, which sounds faintly angelic but one suspects is more prosaic than it sounds.

 

So 48 working hours with no internet, no email, no shared computer drives – it is only when this happens that you realise how much we depend on modern technology on a day-to-day basis. And how little of it I actually understand.

 

Finding myself back in Wigan to see friends yesterday, I visited my father’s grave. He loathed computers with a passion. He worked in banking all his life, and his 1940s/1950s version of a technological crisis occurred one day when he was running a sub-branch of Martins Bank near Burnley. The front door lock jammed, a problem to which my father inventively responded by providing counter service through the letterbox until the locksmith arrived.

 

Sadly, these powers of innovation and lateral thinking utterly deserted him when it came to modern technology; not only did he rely on me to programme the early 1980s versions of technology such as video recorders, but he actually announced his retirement from banking when his employer moved on to a computer system.

 

I often now find myself similarly in technological thrall to my eleven-year old son Peter, requests for assistance usually being met with a characteristic “Oh Dad!” and that eye rolling motion that his teacher hates so much. I still don’t think he believes me when I tell him I never saw a computer until I went to university.

 

My equivalent of my father’s technological crisis occurred in the mid-1990s in Oxford. Oxfordshire was in the midst of a long-running postal strike, but neighbouring Gloucestershire’s postmen were working normally. As I lived on the fringe of the Cotswolds out towards Gloucestershire, I would leave the office in mid-afternoon to take our post up to Moreton-in-Marsh, just on the Gloucestershire side of the Oxfordshire border, to ensure that it was sent out safely and on a timely basis. Thinking back, this was slightly odd, as it didn’t help at all with incoming post, but presumably it took the responsibility for delaying matters out of our hands.

 

They were happy days, when the speed of communication was dictated by the postal system, which I suspect may well have been more efficient then than now. The first tax partner I worked for would receive a technical letter from the Inland Revenue and would say “I will put that away for a week or two to think about it”, and would proceed to do so. What a luxury that seems in an age of e-mail, and the desire and expectation of an immediate response. How stressful would my father have found that (I know how stressful I find it)?

 

And of course when the system breaks down, how do you let people know you are not getting their emails; that you are not just ignoring them or giving other people priority? On the other hand, how did we used to schedule large meetings before Doodle, and communicate with a large group of people before email?

 

The other shocks to the system of our system meltdown were looking things up in books rather than on the internet and not being able to update this blog, a medium that depends above all on topicality. Thank goodness the system is due to be back up today.

 

My final thought is of how my instinctive distrust of modern technology strangely stood me in good stead last week. Having had fun with our dying server previously, I have taken to saving items I am working on currently on the drive of my own office computer, which meant that I could work on it all when the network went down. I couldn’t print it, or send it anywhere by email, but at least I now have a large body of work just waiting to go once the network comes back to life. My wife and our office administrator tell me this is very bad computer discipline, but I would have been in deep trouble if I had relied purely on the network.

 

My father, I suspect, would have been proud of me!

 

 

 

 

Chance had it that yesterday afternoon and this morning I had cause to attend four very different events, all to some extent outside the mainstream activities of a tax advisor. And very interesting they all were too.

 

First up yesterday afternoon was a joint Labour Party / Federation of Small Business /InstituteofChartered Accountantsevent to allow senior Labour party figures to ask key questions and listen to the responses of small businesses. They fielded an impressive array of talent, and asked the right sort of questions. The format was less than perfect, ending up somewhat rushed and with people feeling that they had not fully had their say, but nonetheless the heart of the organisers was very much in the right place, and did give the impression that the Labour party is keen on an approach of conversation rather than confrontation with the sector, which has to be good news.

 

Following that, conveniently in the same building, wasManchesterMetropolitanUniversity’s “Love 2 Trade” event, open to MMU alumni of their various business programmes. It featured some interesting workshop sessions, notably by the always engaging Haydn Insley of FabLab on generating business ideas and Tony Smith of Winning Pitch (an organisation of which I have had mixed experiences) on effective selling. With backgrounds including professional music and Pot Noodle selling, you might expect both speakers to be thought provoking, and indeed they were.

 

First thing this morning was one of my more normal haunts, Manchester Business Breakfast Club at the Manchester Tennis and Racquets Club. This not for profit breakfast networking group is the oldest inManchester, and operates on a not-for-profit basis. As a founder member 14 years ago I am naturally highly biased in its favour, but it is currently going through a good spell, with 35 members and a steady flow of guests.

 

Immediately after that was the clear highlight of the two days, the free(!) Pro Manchester SME Club event on Social Media. As a 50 year-old I had always assumed I was at least 20 years too old to understand this phenomenon, although readers will note that I have gone so far as to start, and maintain, this blog! However, a succession of excellent speakers delved into the mysteries of successful business use of social media, culminating in a tour de force from Jeremy Waite, Head of Social Strategy at TBG Digital.

 

For the first time, someone was able to explain to me in terms that I could understand what approach it is necessary for a small business to take to social media, and that in fact the approach required is entirely consistent with what I had previously thought was my slightly eccentric attitude to business. In fact so inspiring was Jeremy’s presentation that he has sent me rushing off to open a Facebook account, on the basis that I now know what I am going to say and how and where I am going to say it. The universal consensus of a large and enthusiastic audience was that this was a wonderful event, and hopefully the first of many such from this innovative new organisation. How do I join?