Chancellor’s spring statement

[Cheesecakeandwineinasuitcase]

AIBU to think that today we are about to be hugely disappointed by what Rishi says in his spring statement and just to realise just how out of touch he is with the grim reality that normal people (I.e. not millionaire politicians) in the Uk face?

My prediction is that he won’t back down on the 1.25% increase in NI contributions that he is making people pay from April. There will be a paltry reduction in fuel duty (maybe a few pence if we are lucky - but that will easily be cancelled out within a few days as prices increase to compensate). Maybe he will reduce the duty on champagne this time or some other gimmicky sweetener (wasn’t it Prosecco last time?). He might raise the threshold from which people have to start paying tax but for most working families that won’t make a jot of difference.

So it feels like we are sitting ducks and that as time goes by more and more people end up really struggling.

@Burgoo

I agree and at the same time someone has to pay for the past 2-3 years. Its shit and I have no idea how we get out of this mess (we can't keep spending our way out of it but austerity doesn't work either). Tax corporations and it'll just get passed onto customers anyway. Interestingly, over the past two years people praised furlough, wat-out-to-help-out and the money give-aways that Sunak was offering. Now we have to pay it back and people are upset.

We don't get anything for nothing. There is always a catch. The public can't accept this or are stupidly thinking money grows on trees.

The public can't accept this or are stupidly thinking money grows on trees. This kind of wank would be easier to "accpet" if there was any truth in it - but it's demonstrably false. The Magic fucking money tree always turns up when Sir Bufton Fucking Tufton needs it - or some Russians need a place to launder there their funds without taxation or scrutiny.

It's also that there is a fundamental difference between a national economy and that of a household and leads to sub-optimal investment decisions and is part of the reason the UK is a relatively low wage, low skill economy. Any comparison of post-2008 recovery and austerity might illustrate some of the sub-optimal effects.

The concept of a magic money tree (or Schroedinger's Magic Money Tree which doesn't exist beyond the extent to which the Conservatives need to bribe NI) interestingly equates to exactly the amount they choose to borrow and spend to meet the interests of their true stakeholders and occasionally the electorate every five years and this amount is prudent and a penny more is reckless or socialist or both.

Currently the cost of HS2 stands at between £72 - £98 billion. Estimated to cost £116 billion in total (but likely more). Tax payer money, that in my eyes, could’ve been used to help things like...

@browneyes77 this old chestnut again?

There is not a finite pot of funds. If you cut an infrastructure project you don't suddenly free up cash for current expenditure.

HS1 (the connection between London St Pancras and the Channel Tunnel) has already paid back more than half of the government's capital, having only been opened in 2007. HS2 will do likewise.

You can’t “pick” child poverty stats.

You really can. There are entire books written on how to misuse statistics.

@DdraigGoch

You can’t “pick” child poverty stats.

You really can. There are entire books written on how to misuse statistics.

I provided a link from the Child Poverty Action Group. If you want to argue with their stats by all means provide a link to evidence that. 🤷‍♀️

@DdraigGoch

Currently the cost of HS2 stands at between £72 - £98 billion. Estimated to cost £116 billion in total (but likely more). Tax payer money, that in my eyes, could’ve been used to help things like...

@browneyes77 this old chestnut again?

There is not a finite pot of funds. If you cut an infrastructure project you don't suddenly free up cash for current expenditure.

HS1 (the connection between London St Pancras and the Channel Tunnel) has already paid back more than half of the government's capital, having only been opened in 2007. HS2 will do likewise.

It’s tax payer money that’s been budgeted for a project.

It’s not about cutting a project when it’s already started, it’s about not wasting money starting it in the first place.

That particular project wasn’t given the green light or work started until 2020, when the pandemic was already here. So they could’ve pulled the plug before it went ahead, given the dire economic circumstances of the country at the time and the continuing impact.

2007 was 15 years ago. So what you’re telling me is HS1 has taken 15 years to only pay back around half of the money spent on it? So 15 years later and it still hasn’t recouped and profited from the money spent on it? Not sure you’re really selling it to me here….

The UK government does treat current and capital expenditure differently in line with the notion that capital will add to assets that improve the long term wealth of the nation (haven't looked up the real definition).

Some investments will have a longer-term payback period than 15 years and some will continue to be used and provide a 'return' for much longer than 15 years.

It is interesting though that the government asserts some policies can't be afforded while some (HS2, nuclear electricity, the nuclear deterrent, rtefurbishment of HoP) must be afforded.

It’s funny isn’t it. They are happily ploughing money into hs2.
Whilst every £1 spent on early years poverty support directly repays £2.28 to the economy. Plus creates a happier society, I’d also argue it returns are higher over generations.

So 15 years later and it still hasn’t recouped and profited from the money spent on it? Not sure you’re really selling it to me here….

And that is why it's so hard to get any of our long term issues addressed in the UK. Everything is so very short term.

@Zilla1

The UK government does treat current and capital expenditure differently in line with the notion that capital will add to assets that improve the long term wealth of the nation (haven't looked up the real definition).

Some investments will have a longer-term payback period than 15 years and some will continue to be used and provide a 'return' for much longer than 15 years.

It is interesting though that the government asserts some policies can't be afforded while some (HS2, nuclear electricity, the nuclear deterrent, rtefurbishment of HoP) must be afforded.

I think pretty much all govts & organisations separate current and capital expenditure. It's one of the basic fundamental accounting concepts. I don't think it's specific to the UK govt at all.

Gordon Brown got in trouble with the IMF for trying to reclassify current expenditure as capital - I think he was trying to argue that some public sector wages (maybe nurses) should be capitalised on the grounds that it was capital in nature if it improved the health of the nation. Inevitably, he didn't win his argument!!

HS1 (the connection between London St Pancras and the Channel Tunnel) has already paid back more than half of the government's capital, having only been opened in 2007. HS2 will do likewise

Zero comparison...
People and goods want to hook up to the worlds wealthiest trading bloc of 450m people and link into Europes HS network for business and holidays.
HS1 is a relatively short bit of track @67 miles, if it has taken 15 yr to pay back 50%, we are looking at 100s of years before we recoup 50% of HS2.

Who wants to go to/fro Birmingham to save 20mins? we have moved to hybrid working from home, so HS2 will prove to be a huge costly white elephant.

UK is also a small country, we need, internal, better, cheaper, less congested rail NOT expensive very limited HS services.

We've 1.3m going into absolute poverty, this should be any govt's priority.

@user1497207191 indeed. I didn't mention the nationality as a paean to the UK government's specialness, rather as for some issues the answers would be different in different nations or legal jurisdictions. Not an issue here as the thread is about the UK Chancellor but I'm not bright enough to adapt my behaviour on the fly.

I recall when the UK used to use cash accounting and hard annuality rather than resource accounting and that gave rise to flawed incentives.

2007 was 15 years ago. So what you’re telling me is HS1 has taken 15 years to only pay back around half of the money spent on it? So 15 years later and it still hasn’t recouped and profited from the money spent on it? Not sure you’re really selling it to me here….
We're talking about an asset with a very long lifespan here.

It is interesting though that the government asserts some policies can't be afforded while some (HS2, nuclear electricity, the nuclear deterrent, refurbishment of HoP) must be afforded.
With the rise in wholesale gas prices, I'd say that building nuclear power stations is a very good investment (should have started decades earlier). While I'd rather that we didn't need to spend money renewing Trident, it would be very foolish not to have nuclear weapons while a lunatic like Putin does. The Palace of Westminster meanwhile is a very old building that is frankly dangerous at the moment (falling masonry, fires etc.), the refurbishment can't be avoided.

we are looking at 100s of years before we recoup 50% of HS2.
Rubbish, you charge people more for travelling long distances and there will be more of them. HS1 currently sees 6tph in each direction, two of which are 400m long, the rest 120m. HS2 will see up to 17tph, half of which are 400m long, the rest 200m. Therefore the money will be recouped just as quickly.

Who wants to go to/fro Birmingham to save 20mins?
It's a 30 min reduction between London and Birmingham actually; if you're going to try and convince anyone you should at least get your facts right (it took me all of two seconds to look it up). HS2 will reduce the journey times between London and Scotland to less than four hours. That's widely acknowledged as the tipping point between rail and short-haul aviation, and we do need to be getting planes out of the skies.

we have moved to hybrid working from home, so HS2 will prove to be a huge costly white elephant.
With a move to hybrid working, many people have moved further away to places where the cost of living is cheaper. Their days in the office might be fewer, but they will be travelling further. Lots of people travel for reasons other than work in any case. Not all of us live next to St Pancras, I'd quite like an hour's lie-in before travelling south to catch a Eurostar, instead of getting up at 4am.

UK is also a small country, we need, internal, better, cheaper, less congested rail NOT expensive very limited HS services.
You want cheaper, less congested rail? Then you need to build HS2. The WCML is officially "congested infrastructure" according to Network Rail and the operator is having to price passengers off to avoid being overwhelmed. The solution is to build a new line. HS2 will treble the number of seats available out of Euston.

We've 1.3m going into absolute poverty, this should be any govt's priority.
As has been repeated many times in this thread, there isn't a fixed pot of money.

Hs2 saves 20 minutes not 30 minutes - ironically at least 20 minutes has been added to most locals commute as a result of the building works.

It’s going through ancient woodlands that will never recover
They've felled ancient trees unnecessarily and accidentally.

They’ve given no support to businesses and community groups trying to relocate or just keep going through uncertainty

It’s estimated it’s going to kill 1% of all barn owls a year.

The species that have been affected by the building works already are huge, red list animals, no fucks given. Lights left on 24/7 confusing wildlife.

Hs2 as a company have behaved appallingly, using land they’ve not paid for, holding on to payments for buildings and land. There’s plenty of YouTube videos on this.

The land they’ve acquired that is currently used as depots and sites, will not be returned to the greenbelt it was. It will be developed into profitable housing, it won’t be the government that profit from that, it will be HS2 and the builders currently courting them. This is land that was deemed too precious to develop before. So either it’s important to protect these things or it’s not.

It will take 100 years to be carbon neutral

Have you seen the cost of rail travel? It’s so expensive and HS 2 will be predicted to be the same.

It’s not the railways time that stops people using it over planes. It’s the cost. I can get to edinburgh on a plane for £20. It’s over £100 for a train ticket - that’s the issue.

The training centres have been marred with issues from the start, I believe these have now been closed so there’s no lasting legacy.

And the budget? We all know about the budget.

Your an utter fool if you think this is an environmental decision. Just drive around the areas it’s decimating to see how bad this is for our little country.

I spend a lot of time with work around buckinghamshire, hillingdon, Oxford and the outskirts of birmingham. So HS2 central.
During the consultation the propaganda between birmingham and london was mad, it was truly pitched as opposition “london don’t want you to have their money and jobs”
“Birmingham don’t want you to take advantage of their cheaper housing”

When the reality was the majority of both residents didn’t want it!

@DdraigGoch A 29min saving is the very fastest theoretical journey time.... 9 mins difference between what you say and mine, just enough time to order a Costa... with another 9 mins to drink it lol

Plus many business people say the time spent on the train is used productively, so its not as if this 29 (or 20mins) is going to make the slightest bit of difference.

Don't really see how an extremely expensive HS line is going to help congestion or bring down fares,, has HS1 helped bring down fares or ease congestion in the SE? No, it hasn't.

Then there is the environmental costs that building this eyesore is doing to the countryside... irreversible.

I do agree we should be discouraging short haul aviation, rather odd then that Sunak reduced the duty on short haul flights, making rail even less competitive.

the monies being wasted on this project should go on improving local lines, new lines normal lines & reduced fares... we already have the highest fares in the country with rises linked to inflation, so will remain uncompetitive.

@browneyes77

2007 was 15 years ago. So what you’re telling me is HS1 has taken 15 years to only pay back around half of the money spent on it? So 15 years later and it still hasn’t recouped and profited from the money spent on it? Not sure you’re really selling it to me here….

Big infrastructure projects like that are never planned to have such a short pay-back period. Nothing would ever get built if there was an expectation to be "in profit" in as little as 15 years. The life of the railway line is many decades. Most of today's rail network is over 100 years old!

And some infrastructure projects will never "pay back" in financial terms as they're done for reasons other than financial ones, i.e. for the greater good, such as health, safety, etc rather than being profit driven.

@EvilPea

Hs2 saves 20 minutes not 30 minutes - ironically at least 20 minutes has been added to most locals commute as a result of the building works.

It’s going through ancient woodlands that will never recover
They've felled ancient trees unnecessarily and accidentally.

They’ve given no support to businesses and community groups trying to relocate or just keep going through uncertainty

It’s estimated it’s going to kill 1% of all barn owls a year.

The species that have been affected by the building works already are huge, red list animals, no fucks given. Lights left on 24/7 confusing wildlife.

Hs2 as a company have behaved appallingly, using land they’ve not paid for, holding on to payments for buildings and land. There’s plenty of YouTube videos on this.

The land they’ve acquired that is currently used as depots and sites, will not be returned to the greenbelt it was. It will be developed into profitable housing, it won’t be the government that profit from that, it will be HS2 and the builders currently courting them. This is land that was deemed too precious to develop before. So either it’s important to protect these things or it’s not.

It will take 100 years to be carbon neutral

Have you seen the cost of rail travel? It’s so expensive and HS 2 will be predicted to be the same.

It’s not the railways time that stops people using it over planes. It’s the cost. I can get to edinburgh on a plane for £20. It’s over £100 for a train ticket - that’s the issue.

The training centres have been marred with issues from the start, I believe these have now been closed so there’s no lasting legacy.

And the budget? We all know about the budget.

Your an utter fool if you think this is an environmental decision. Just drive around the areas it’s decimating to see how bad this is for our little country.

I spend a lot of time with work around buckinghamshire, hillingdon, Oxford and the outskirts of birmingham. So HS2 central.
During the consultation the propaganda between birmingham and london was mad, it was truly pitched as opposition “london don’t want you to have their money and jobs”
“Birmingham don’t want you to take advantage of their cheaper housing”

When the reality was the majority of both residents didn’t want it!

100% agree with all of this.

I’m in Birmingham. I’m yet to find anyone here that wants this expensive monstrosity.

It's a 30 min reduction between London and Birmingham actually

Wow 30 whole minutes less to get from London to Birmingham. I'm so glad those of us that will have no use for this service (i.e the rest of the country), are paying towards this from our taxes. I mean it's not like there's anything better to spend all that money on is there.....oh wait.

A 29min saving is the very fastest theoretical journey time.... 9 mins difference between what you say and mine, just enough time to order a Costa... with another 9 mins to drink it lol
I can do a lot of things in half an hour. For those of us living further north than you, the reduction is up to 54 mins. That's a world of difference, especially for those going out and back in the same day.

It’s not the railways time that stops people using it over planes.
The evidence contradicts you there. As Eurostar's timings progressively got quicker when sections of HS1 were opened, it decimated the London-Paris/Brussels aviation market. www.airlineratings.com/news/trains-versus-plane-eurostar-almost-halved-airline-demand/

“The reduction in scheduled aviation capacity which occurred in the mid-2000s appears to have coincided with the start of the new Eurostar service from St Pancras International Station in London, and away from London Waterloo.”

It’s the cost. I can get to edinburgh on a plane for £20. It’s over £100 for a train ticket - that’s the issue.
As I said, the operator was forced to price people off because there simply isn't the capacity to carry them. The WCML is officially congested infrastructure, you can't put any more trains on it and there's no room to extend the length of them. Increase the supply of seats and prices can drop.

Don't really see how an extremely expensive HS line is going to help congestion or bring down fares,, has HS1 helped bring down fares or ease congestion in the SE? No, it hasn't.
You're talking out of your arse, of course capacity in the South East increased. Eurostars used to have to crawl from Folkestone to Waterloo along the existing lines, fitting in with the commuter trains. Now that HS1 is open, slots have been freed up for said commuter trains and the former International platforms at Waterloo are now used by them. In addition, there is more capacity for passengers travelling between Kent and London. Every one of the 340+ people on a 395 into St Pancras six times an hour is someone who would otherwise have been crowding out the trains which run into Charing Cross.

Capacity on the WCML is severely hampered by the need for 125mph express trains, 100mph stopping trains, and 75mph container trains to coexist. Segregate one of those by building a new line and you can run the other rains at much closer headways.

Then there is the environmental costs that building this eyesore is doing to the countryside... irreversible.
Ever seen a motorway? HS2 will be a fraction of the size while providing twice the throughput.

I’m in Birmingham. I’m yet to find anyone here that wants this expensive monstrosity.
Try asking leading employers: www.ft.com/content/306f2f60-7c9b-11e9-81d2-f785092ab560

Away from Birmingham, the announcement that the Eastern leg would be descoped were met by cries of "betrayal".

@TimBoothseyes

It's a 30 min reduction between London and Birmingham actually

Wow 30 whole minutes less to get from London to Birmingham. I'm so glad those of us that will have no use for this service (i.e the rest of the country), are paying towards this from our taxes. I mean it's not like there's anything better to spend all that money on is there.....oh wait.

Frankly I don't see why my taxes have gone on motorways, I never use them, they don't even go near me. What was wrong with the single-carriageway A roads we used to use? It's not even like they'll ever pay back their capital, given that (other than bits of the M6) you use them for free.[/sarcasm]

I live about a mile from where HS2 is going to be, it's coming round the edge of my town in one side & out the other!
The decimation of the Country side makes me feel physically sick!
It's not just the actual line it's all the service roads they are building before they even get to the railway!
You can't move out of town without sitting in a queue of traffic where temporary ( 3 years) traffic lights have been put up to give the lorries access in & out! Local footpaths have been closed! Trains running all night on the local line to carry soil to wherever they are dumping it!

We're over run with bloody foxes, dear are wondering down the roads, it's bloody awful!
They have already cancelled HS3 etc - it's all for nothing!
All the destruction & inconvenience never mind tax payers money -it's an absolute scandal!

If the test is personal use then that seems imperfect and would make investment decisions more complicated. All the 'Cross-rails' and every London-centric investment wouldn't help most of the electorate, except in the economic growth and tax revenues, perhaps?

We're over run with bloody foxes, dear are wondering down the roads,

Poor sods have been evicted without notice. Probably lived happily, quietly and generationally keeping the local rodent population down, on the land that’s being destroyed.

Then there is the environmental costs that building this eyesore is doing to the countryside... irreversible.
Ever seen a motorway? HS2 will be a fraction of the size while providing twice the throughput.

I’m not sure saying we’ve made worse environmental impact before, so let’s make more is an argument you can use.

The land they’ve acquired isn’t going back to the beautiful green belt it was. It’s not greenbelt anymore, it’s fucked, it’s a desolate wasteland that’s going to be turned into flats and houses. It’s going to cover more than a motorway would.

Have you actually seen the sites? The great big roads, the containers stacked, the 24/7 lights that make it like daylight?

They’ve drained lakes for it. How is that even ethical.