Today's Financial Times (p.3. Gordons 6bn tax grab) reports that the Institute for Fiscal Studies says that the money announced for refurbishment of schools in the PBR was not new money. David Davis suggested as much on question time last night to be rebutted by Ruth Kelly who claimed to have specifically double checked this issue with the Treasury, and could confirm that this was 'new money'.
So is it new money or not? I didn't see Ruth Kelly's defence, and she's quite adept at being economic with the truth when it suits and may have played with the English language, but if she is wrong, she is in big trouble. Time for my financial blogger friends to come up with the definitive answer?
19 comments:
I don't see that the age of the money that's going to be spent on this makes much difference. It's still shuffling deckchairs on the Titanic. The fabric of buildings doesn't make schools great. I was educated at a private school, which was my good fortune, but the results of that schooling were so much more to do with the teaching than the cold, damp, pre-fab temporary classroms that were put up in the 1940s and designed to last 10 years but were still being used in the eighties. Can they really not think of something better to spend this old/new money on than bloody refurbishment, and why aren't the opposition pointing this out?
The only sense in which it is new money is in the sense that it hasn't been spent yet. The "Building Schools for the Future" project to revamp all secondary schools by 2015 was first announced in 2003. As the IFS confirmed yesterday the £36bn headline figure is made up of £2bn for colleges and the £34bn for schools which had already been announced in the Budget in March, when it was described by the IFS as a "highly misleading presentational device".
According to the IFS, before the pre-Budget report, the Govt was spending on average £5650 per pupil at state schools versus £8000 in the private sector. The pre-Budget report increased that figure by £20 per pupil. Golly he's generous! He also introduced an additional 70% inheritance tax on Sipps and I thought Labour had been encouraging portable personal pensions....
Just as well she's a studded-garter wearing Opus Dei member; since she continually repents of her continual sins she will still go to heaven.
Not such a surprise that the PM is secretly converting, then!
I saw the programme; she definitely stated that it was new money, though annoyingly she wasn't pressed on the matter. She stated also that the ISG report was “a great opportunity” (several times) and when pressed on Blair’s influence in Washington pointed out that he had liaised with the ISG. Again annoyingly no-one seemed to pick up on the fact that if Blair’s influence is via the ISG then presumably she was accepting that he had little or no influence outside of it.
At times like this it's often useful to reach for a handy phrase attributed to the Iron Chancellor himself:
"There is nothing you could say to me now that I could possibly believe."
Iain you write: "if [Ruth Kelly] is wrong, she is in big trouble."
Um, why? Since when was being wrong, or even telling porkies, enough to get a New Labour Minister into trouble?
You could try comparing the capital budget for the Department of Education & Skills as it appeared in March's Budget (table C13):
http://www.hm-treasury.gov.uk/media/20F/42/bud06_chc_247.pdf
with the budget as announced on Wednesday (table B18):
http://www.hm-treasury.gov.uk/media/56A/D4/pbr06_annexb.pdf
The figures show no rise at all in the projection for 2007-08, at £7bn - though this excludes PFI deals, which seem small (tables B22, B23)
'if she is wrong, she is in big trouble' - I do hope so, she is useless, arrogant and is probably the worst MP for ages, but she doesnt realise it.
Refurbishment of schools with PFI = Privatisation of Schools.
No wonder Labour was getting Academy funding from property-developers - all those playing fields sprouting executive homes.
I cannot believe Labour is privatising the State School real-estate and getting applause for transferring public assets to companies in a sale-and-leaseback deal.
The English are a really dim people
bretters is right. I went to a grammar school in the eighties that still had those decaying 1940s pre-fabs, and it was the quality of teaching that made it a good school not the quality of the buildings. Spending money on shiny new facilities doesn't address the real problems in the education system; it just provides an easy way for politicians to pretend that they're doing something about them.
Thought the bit about Kelly "checking" that it really was new money said it all. Surely she was not admitting that Brown & Co have previous form for announcing the same investment more than once. Maybe she just wanted to check if there had been a change in the spin cycle since she worked at the treasury.
think u will find it was 600 mill for soldiers.or 2% on defence budget so new chairs and laptops for the mod and
a swiss army nife for iraq.
Iain,
Good point and I hope you get a reply but WAKE UP!! Give Cameron a ring and tell hime to look at Teletext on ITV Havel Blears is putting her troops on a war footing for an election in Spring 2008!! Why? Could it be anything to do with that fact that The Boundary Commission cannot finish its work by then and give the Conservatives a 20 to 30 seat advantage?
Or the chickens are coming home to roost on the economy with this tax and wast Government and its spin over new/old money??
Brown will try and pretend it is for some other reason because he is as devious as Blair!
I guessed this would happen and Cameron had better come out fighting with Policies!!
New money or not, wouldn't the money be better spent on prisons? The government may not have to let murderers, sex offenders and violent criminals out early on licence. It has all gone quiet on the prison front.
I was told by a very astute broker that he will be getting out of commodities during 2008.
Why?
Because he thinks we will be entering a recession in 2009. Hence people will not need "things" to make "things", because there will not be the market for them.
My betting is that gordimmo knows the same, and realises that if he leaves it too late to call an election. The house of cards he has built up will be blown over before he can blame it on someone else.
Of course this is new money. Newley out of somebody else's wallet.
It dont matter whether its old or new money. Until the broadcast TV media tell the people the truth about this governments lies and propergander we will all continue to have our plonkers pulled by the state.
The BBC is, beleive it or not, still trusted by 70% of the British public. It will not turn on the establishments own new political party New Labour even a little bit untill its charter is renewed.
Which the Labour party will not do untill this country has gone beyond help. Which unfortunately is sooner then we would all like.
Tory shadow ministers could help this situation by forcing themslves on the BBC if they were not so preoccupied making money for themselves or tied up at Madam Sins most of the time.
Depressed? you all should be.
However if I was young I would be looking for a large bottle of sleeping pills or my passport.
This is not about schools but about hospitals. I have a friend who started a company that had a contract to clean hospitals properly. His " hit squad" did a better job in a 24hr period than the then own labour force could do in a week.
At the time we are talking about ( mid eighties) for one of the largest agglomerations of Hospitals and departments in Glasgow there was ONE MAN who was in overall charge of making sure the various wards, operating theatres etc etc were germ-free. He was paid ( about) £25,000 pa - not bad for then, and worth about £100,000 now.He KNEW what was required, what was going on and directed his tactics accordingly.
Come in 1997. That year, the number of people doing this specific job was increased to 3. It has subsequently increased to SEVEN. The hospital is not any bigger, in fact there have been bits of it closed. And the seven bandidos each have their own staff, which total another 25 people, so there are effectively 32 people doing what one man did. However, they are all very busy shuffling papers between themselves as they have to coordinate their efforts - they can't have 3 wards shut at the same time for example. My friend tells me that he was asked to clean one particular ward, and it then took ten days for the 32 people to agree on a date - this was after there was a problem that required immediate attention. The ward stayed open in the meantime. And what is the cost of these 32 people? I don't know, but it must - including pensions etc - amount to well over £2.5m pa.
Sick transit gloria.
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