Gaining Employment, LVT Style

From The Register

Game development firm OysterWorld is opening up a base in south Wales that will bring 60 jobs to the region in the next three years.
Wales beat out Canada as the site for the development, marketing and research centre, which will be backed by £1m from the Welsh government.

While I normally can't stand subsidies, that's not too bad a deal - £16K/job, for the sort of jobs that produce something that people want, in an industry that have people that make a lot of money. It's basically reversing a load of the income tax.

But what it's really doing is fixing the result of the problem, rather than the problem itself.

Income tax takes no account of how portable a job is. A bloke writing computer games gets taxed at the same rates as someone selling snowglobes of the houses of parliament. But one of these can go anywhere in the world and do it, the other has to be in London.

So, we throw money at companies to move to Humberside, Wales etc as a way of compensating for the problem. We adjust their tax to cover for the fact that we don't have Land Value Tax. The problem is that it's crude, complicated, means government is picking winners rather than letting the market work things out, requires lots of bureaucracy and corruption and only works for companies of a certain size.

If we had LVT, we'd be able to scrap all of this, all the rural development fund malarkey. Companies would move to former mining areas because well, they could get really cheap staff because the staff would be paying bugger all in income tax, and the UK would probably become a major location for startup businesses.

They are today Gus, it even got a mention at DPMQs

Writing at Labour List yesterday Gus Baker – in his own words a “lawyer in training” who is also a BECTU official covering Disciplinaries and Grievances and co-founder and co-director of Intern Aware – posed the question Why won’t Labour talk about the job guarantee scheme?

“Imagine” writes Gus “if the Labour Party came up with a policy that proposed ending long term unemployment, whilst simultaneously rebutting charges that the party was ‘soft on welfare’” and later, referring again to Labour’s apparent reticence to be much more vocal about an obvious “win – win” policy, “It makes no sense that Labour is ignoring the best idea that the party has had in decades. It’s time to speak up”.

So what exactly is the Job Guarantee Scheme?  Well, the most often quoted explanation is that it  will ‘offer’ the long-term unemployed a guarantee of a six-month job by dint of giving businesses a subsidy to hire people on a temporary basis, at the national minimum wage for six months, with those unemployed refusing a job under the scheme having their benefits docked.  

Initially the guarantee would apply to adults – in this context those aged over 24 - who had been out of work for 24 months or more, with Labour seeking to reduce the “unemployed for” qualifying period to 18 or 12 months during the course of a Parliament.  The costs of the subsidy, which Labour originally calculated as £1 billion per annum, would "be met by reversing the government’s decision to stop tax relief on pension contributions for people earning over £150,000 being limited to 20 per cent”.

In his article Gus admits that “The Jobs Guarantee scheme is not a panacea for all of the UK’s problems, but capping the amount of time that people could be unemployed in Britain would do no end of good. The hopelessness that people often feel when out of work could be ended by setting a date at which they would be guaranteed good quality, decent work. The political potential of the scheme is enormous”.

And on the face of it, £1 billion for the JGF seems like a much better deal than the £5 billion Work Programme.  Today, perhaps seeing an opportunity to "speak up" Labour’s Shadow Work and Pensions Secretary Liam Byrne commenting on today’s (un)employment figures says “bring in Labour’s Compulsory Jobs Guarantee to get anyone out of work for more than two years back into a job; a job people must take or lose their benefits”.

So, to go one step further than Gus, why won’t the present administration ditch the Work Programme and replace it with their own “Jobs Guarantee” scheme?   They don’t have to call it that, and they claim to be in favour of “what works”?

Vaguely interesting .... or immensely depressing and explaining one hell of a lot ...

The Department for Work and Pensions chose today to unveil its new website and issued a release about it https://www.gov.uk/government/news/we-have-a-new-home-on-the-web

Anyway, a scroll through the new layout at www.gov.uk/dwp  was called for, and whilst doing this on the Home page section for the "great and good"  (no photoshopping was used in the production of the images shown) took a gander at the entry for Chris Last - who in addition to being DWP Director General, Human Resources is also (the first) Head of Government HR Operations.  In the mini blurb on his page it goes on to say that - and this is of course something worth boasting about -

Chris has transformed HR into a smaller, more professional service.

which is surely "a good thing" and yet .....

He introduced a graduate entry programme for HR and now the Civil Service is the largest recruiter of HR graduates in the UK.

Er, say no more ....