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Original poster

‘22bn black hole’

55 replies

EverythingAllatOnceAllTheTime · 12/09/2024 03:58

Labour refuses to disclose key details of alleged 22bn ‘black hole’.

What is it with Labour? They seem hell-bent on implementing some bonkers tax rises, premised on some very dubious data.

Their latest rental reform proposals are also utterly daft, and will deliver the opposite of what they are trying to achieve.

OP posts:
marmaladeandpeanutbutter · 13/09/2024 19:35

Oh yes, @Clavinova . When your people were in charge.

Clavinova · 13/09/2024 19:13

Notonthestairs · 12/09/2024 07:23

I guess this report outlines where there has been sustained under budgeting.

"n recent years, the Home Office has repeatedly spent far more than it had budgeted for asylum, border, visa and passport operations...

The Home Office has got into the bad habit of each year submitting Main Estimates to parliament that it knew would be insufficient, relying on a top-up from the Treasury Reserve later in the year."

ifs.org.uk/articles/home-office-budgeting-and-asylum-overspends

If you look at the bar chart in your link (Figure 1. Change between planned and actual Home Office day-to-day net spending...)

  • the IFS have calculated a £4.2 billion overspend for 2023-2024 ('In 2023–24, it spent £4.2 billion more than planned...'). The estimate for 2024-2025 is only slightly lower (the backlog of asylum seekers hasn't disappeared).

Labour can't say they didn't know about the overspend because they carried out similar analysis themselves back in February this year;

28 February 2024

Hotel costs for asylum seekers overspent by £4.3 billion last years figures show.

The total amount spent on hotels and support for asylum seekers ballooned to £5.4bn in 2023-24 – a huge overspend on the Home Office’s £1bn budget for asylum support, resettlement and accommodation, Labour analysis of Treasury figures suggests.

Shadow Home Secretary Yvette Cooper said: "This lays bare the complete chaos the Tories have created in the asylum system..."

"Labour has set out a clear plan to save billions of pounds for the taxpayer..."

Labour’s figures came from analysing supplementary estimates from the Treasury.

https://inews.co.uk/news/politics/asylum-seekers-hotel-overspend-treasury-2931907?srsltid=AfmBOor0MdYFIWRZNgK66fJmlUdjI12XladHj2xsh7oK-IbrGUXyhcGv

EasternStandard · 13/09/2024 07:05

There is also the refusal to show or prepare an impact assessment for the WFA removal

They did in 2017 in opposition but not now they are actually bringing it in

And IoD and CBI warning that they are too much impacting investment and business

And the 'black hole' stuff

taxguru · 13/09/2024 06:00

People are forgetting the £22 billion is EXTRA deficit, not the deficit. Spending had exceeded income by tens of billions virtually every year for the past 25 years. Forecasts already showed tens of billion deficit this year, the £22 bn is on top of that. Too many people seem oblivious to that and are making out them£22 by is the only shortfall. The reality is the country is £2.5 trillion in debt due to overspending over the past 25 years! The problem is a hell of a lot bigger than £22bn.

spuddy4 · 13/09/2024 04:08

marmaladeandpeanutbutter · 12/09/2024 12:31

@MorphandMindy That black hole was created in one day by Liz Truss! Don't blame the elderly.

How? And if it was caused by Truss why won't the government release the information? It wouldn't be their fault so if I was in their position I'd be shouting from the rooftops and have no problem releasing the information but instead they have denied a FOI request.

Guavafish1 · 13/09/2024 03:57

Countries finance are in a bad way… it’s been like this since Brexit , and make worse by Covid and Truss

Atstitch · 13/09/2024 02:46

I wonder if it includes all the bounce back loans and coronavrius loans that are yet to be paid back and will start to be claimed upon against the government guarantee.

TizerorFizz · 13/09/2024 02:42

And Covid!

marmaladeandpeanutbutter · 12/09/2024 12:31

@MorphandMindy That black hole was created in one day by Liz Truss! Don't blame the elderly.

nearlylovemyusername · 12/09/2024 12:27

Notonthestairs · 12/09/2024 09:02

I've posted this on another thread -

In his report, Lord Darzi said the “Health and Social Care Act of 2012 was a calamity without international precedent. It proved disastrous.” He added: “In the last 15 years, the NHS was hit by three shocks — ­austerity and starvation of investment, confusion caused by top-down ­reorganisation, and then the pandemic, which came with resilience at an all-time low. Two out of three of those shocks were choices made in West­minster.”

"Darzi said the 2012 reforms represented a “scorched-earth approach to health reform” as it dissolved NHS management structures in a “uniquely complicated piece of legislation”. The reforms established more than 300 new NHS organisations, which led to “institutional confusion”, from which the NHS was still recovering."

I dont know how you can read this report and think it has been well run.

www.thetimes.com/uk/healthcare/article/lord-darzi-report-nhs-review-6td77lqdw

what does this have to do with the topic? Labour refuse to disclose the details

This is what OP refers to

UK Treasury refuses to disclose key details of £22bn fiscal ‘black hole’ (ft.com)

OP, I'm with you. It's a real insult on one's intelligence.
But I'm not surprised people are falling for it.

Original poster
EverythingAllatOnceAllTheTime · 12/09/2024 12:05

MorphandMindy · 12/09/2024 11:08

lol @RockaLock I'm no longer a civil servant. However they're already underpaid due to years of austerity and pay freezes. And the civil service pension scheme has already had a very dramatic reform (and haircut) about ten years ago.

In fact it was such a severe reduction in benefits that there have been repercussions in the private sector about it.

Several large British corporations actually pegged their own in-house pension schemes to the civil service years ago because that was the "gold standard" - only to be sued when the standard fell so far that it was now worth so much less.

And whoever bitched about "wfh" can fuck right off. I've wfh on and off since 2012 with three different employers and the only difference it makes is having 2.5 hours less commuting time per day and more time to get work done, and a lot more negative attention since 2021, coincidentally since the Tories stopped listening to Murdoch who's been retaliating by pushing this agenda in the news. And you always get lower pay when flexibility is a key need.

So many civil servants are working mums, and it's that way for a reason. It's tough enough working for lower pay just to get a bit of flexibility without people constantly bitching from a position of privilege.

Get back in the office like the private sector.
Earn your keep.
The clue is in the name ‘civil service’.

Theres very little sympathy outside the public sector.

OP posts:
MorphandMindy · 12/09/2024 11:08

lol @RockaLock I'm no longer a civil servant. However they're already underpaid due to years of austerity and pay freezes. And the civil service pension scheme has already had a very dramatic reform (and haircut) about ten years ago.

In fact it was such a severe reduction in benefits that there have been repercussions in the private sector about it.

Several large British corporations actually pegged their own in-house pension schemes to the civil service years ago because that was the "gold standard" - only to be sued when the standard fell so far that it was now worth so much less.

And whoever bitched about "wfh" can fuck right off. I've wfh on and off since 2012 with three different employers and the only difference it makes is having 2.5 hours less commuting time per day and more time to get work done, and a lot more negative attention since 2021, coincidentally since the Tories stopped listening to Murdoch who's been retaliating by pushing this agenda in the news. And you always get lower pay when flexibility is a key need.

So many civil servants are working mums, and it's that way for a reason. It's tough enough working for lower pay just to get a bit of flexibility without people constantly bitching from a position of privilege.

Original poster
EverythingAllatOnceAllTheTime · 12/09/2024 09:36

RockaLock · 12/09/2024 09:19

If a "significant amount of it is due to supporting an ageing population" then I wonder why the civil servants like yourself who have been working so hard on a solution for years haven't concluded that maybe phasing out public sector final salary schemes might be a good idea after all.

The private sector has done this, maybe it's finally time for the public sector to accept that they might have to follow suit. Or are all the civil servants too invested in saving their own pensions?

Show quote history

Because the civil service are partisan and probably wfh.

OP posts:
RockaLock · 12/09/2024 09:19

MorphandMindy · 12/09/2024 06:59

I was about to tell you not to be so ridiculous with your conspiracy theories, and then I remembered that as a former civil servant, the things I take for granted are not things that everyone else believes or knows to be factual. But now Labour have come right out and said it.

So, yes there is a massive hole, the Treasury is very very worried about it and has been for LITERALLY YEARS, a significant amount of it is due to supporting an ageing population and just because you didn't know about it doesn't mean it doesn't exist. There you go.

Thousands of civil servants who have no particular political axe to grind are working on projects to try and rescue the country from this cliff edge, I was one of them about 6-7 years ago.

If a "significant amount of it is due to supporting an ageing population" then I wonder why the civil servants like yourself who have been working so hard on a solution for years haven't concluded that maybe phasing out public sector final salary schemes might be a good idea after all.

The private sector has done this, maybe it's finally time for the public sector to accept that they might have to follow suit. Or are all the civil servants too invested in saving their own pensions?

marmaladeandpeanutbutter · 12/09/2024 09:10

Well that's certainly true.

Notonthestairs · 12/09/2024 09:02

I've posted this on another thread -

In his report, Lord Darzi said the “Health and Social Care Act of 2012 was a calamity without international precedent. It proved disastrous.” He added: “In the last 15 years, the NHS was hit by three shocks — ­austerity and starvation of investment, confusion caused by top-down ­reorganisation, and then the pandemic, which came with resilience at an all-time low. Two out of three of those shocks were choices made in West­minster.”

"Darzi said the 2012 reforms represented a “scorched-earth approach to health reform” as it dissolved NHS management structures in a “uniquely complicated piece of legislation”. The reforms established more than 300 new NHS organisations, which led to “institutional confusion”, from which the NHS was still recovering."

I dont know how you can read this report and think it has been well run.

www.thetimes.com/uk/healthcare/article/lord-darzi-report-nhs-review-6td77lqdw

whereaw · 12/09/2024 08:56

Hopefully the Labour politicians will go on strike soon.

marmaladeandpeanutbutter · 12/09/2024 08:53

@juniperbramble
The difficulty is, the LP are beginning to sound themselves a bit like Cameron did over austerity. If absolutely everything is a surprise to them, what were they doing in opposition?

I see the state of the NHS was a shock to them this morning. I'm beginning to think we are being treated like idiots. And I have always voted Labour, and I'm over 60 now.

They need to change the record a bit and treat us like adults. I think they have a plan and they are instead pretending that it is a new situational response. It's undignified.

Original poster
EverythingAllatOnceAllTheTime · 12/09/2024 08:49

juniperbramble · 12/09/2024 08:38

In the past months, there was back and forth on whether the 22 billion hole came as a surprise or not. Top civil service chief Simon Case has backed up Rachel Reeves against former Treasury lead Jeremy Hunt, saying that, yes, some of it was not fully clear, due to the departments not providing full information and doing the right reviews in time. This had been mentioned as a concern by civil servants at the time, but was ignored by Conservative ministers. Although it was known there was a problem (see IFS messaging on this to both Labour and Conservatives pre-election), the extent of it wasn't fully clear.

Spending on junior doctors and train drivers saves money in the huge economic damage their strikes cost (which vastly outweighs the costs of giving them more wages, and was being carried by society, business, etc. at large, not just the government).

So, there you go.

www.google.com/amp/s/amp.theguardian.com/politics/article/2024/sep/03/civil-service-chief-backs-government-claim-of-22bn-shortfall

Citing your source, the IFS.

Also note that Labour are not prepared to breakdown the 22bn.

Yes, the Tories left Labour a mess to clear up but it’s disingenuous for Rachel Reeves to claim that taxes might have to rise to fund predictable public sector pay rises.

A week on from Rachel Reeves’s big reveal that there is a £22 billion “black hole” in the nation’s finances, what are we to make of the claims and counterclaims and, more importantly, what can we learn?

Frankly, nobody comes out of this smelling of roses. Not the Conservatives who really did leave a lot for the new government to clear up, and were not honest about the challenges ahead. Not Labour, which knew the broad outline of these challenges, but refused to confront them in its manifesto and pre-election statements. And not our institutional framework, which meant that some of the immediate problems were allowed to fester and were obscured in the official data.

Sunak was right….

OP posts:
juniperbramble · 12/09/2024 08:38

In the past months, there was back and forth on whether the 22 billion hole came as a surprise or not. Top civil service chief Simon Case has backed up Rachel Reeves against former Treasury lead Jeremy Hunt, saying that, yes, some of it was not fully clear, due to the departments not providing full information and doing the right reviews in time. This had been mentioned as a concern by civil servants at the time, but was ignored by Conservative ministers. Although it was known there was a problem (see IFS messaging on this to both Labour and Conservatives pre-election), the extent of it wasn't fully clear.

Spending on junior doctors and train drivers saves money in the huge economic damage their strikes cost (which vastly outweighs the costs of giving them more wages, and was being carried by society, business, etc. at large, not just the government).

So, there you go.

www.google.com/amp/s/amp.theguardian.com/politics/article/2024/sep/03/civil-service-chief-backs-government-claim-of-22bn-shortfall

Original poster
EverythingAllatOnceAllTheTime · 12/09/2024 08:07

MorphandMindy · 12/09/2024 06:59

I was about to tell you not to be so ridiculous with your conspiracy theories, and then I remembered that as a former civil servant, the things I take for granted are not things that everyone else believes or knows to be factual. But now Labour have come right out and said it.

So, yes there is a massive hole, the Treasury is very very worried about it and has been for LITERALLY YEARS, a significant amount of it is due to supporting an ageing population and just because you didn't know about it doesn't mean it doesn't exist. There you go.

Thousands of civil servants who have no particular political axe to grind are working on projects to try and rescue the country from this cliff edge, I was one of them about 6-7 years ago.

There’s another enormous hole - in your assertion.

Are you seriously suggesting that the civil service/obr etc didn’t open their books during campaigning?

Utter nonsense, or it’s the fault of the civil service. Which is it please?

OP posts:
rockstarshoes · 12/09/2024 08:07

Well a quick google tells you!

•	Public sector pay rises
•	Overspending on certain projects, such as supporting the asylum system (£6.2B on Asylum housing costs alone)
•	Unforeseen costs, such as inflation being higher than expected
•	Military assistance to Ukraine
Frowningprovidence · 12/09/2024 07:54

I dint know about the rental reforms. But the conservatives were constantly saying there was no money and had to be cutbacks so I can't see that Labour is saying anything different really. One said make savings as there was no money, the other said increase money raised.

indigovapour · 12/09/2024 07:54

MorphandMindy · 12/09/2024 06:59

I was about to tell you not to be so ridiculous with your conspiracy theories, and then I remembered that as a former civil servant, the things I take for granted are not things that everyone else believes or knows to be factual. But now Labour have come right out and said it.

So, yes there is a massive hole, the Treasury is very very worried about it and has been for LITERALLY YEARS, a significant amount of it is due to supporting an ageing population and just because you didn't know about it doesn't mean it doesn't exist. There you go.

Thousands of civil servants who have no particular political axe to grind are working on projects to try and rescue the country from this cliff edge, I was one of them about 6-7 years ago.

This is the point though, isn't it? It's not new news. It was obvious and was known about. Several journalists were talking about it during the election and wondering why it wasn't a huge topic - the reason it wasn't (on Labour's side) is because they wanted to claim it was a complete surprise upon their election and so all their "fully costed" promises could be discarded.