Wasting Public Money: Keep it Simple

Date : 05 October 2003

To : The Editor, The Business

From : Nagindas Khajuria

Subject : Wasting Public Money

WASTING PUBLIC MONEY

Keep it simple

Sir - Bill Jamieson's article on the jobs boom in the public sector - a 3.9% increase in two years to 2003 Q1 ("Boom time in welfare land as Brown's billions flood in", 7/8 September) - highlights waste and duplication of public funds on a massive scale that could bankrupt the UK in 20 years time.

What the public sector needs is drastic streamlining of the entire government machinery, its systems and procedures.

For example, to claim state benefits you have to fill in numerous forms that run to more than 50 pages, which humiliates many potential applicants too proud to be means tested and who lose out on the benefits to which they are entitles. One simple annual tax return system could be used where drawings, mortgage payments, car ownership, house ownership etc could be filled in only once each year to provide realistic data on whether an individual or a household's lifestyle is consistent with income and the need for state benefits.

Currently we use thousands of tax and benefits staff to vet thousands of forms and records which are conducive to tax evasion and fraudulent benefit claims. There are also contradictions in the system. For instance, if you do not claim benefits, then you do not need to declare your partner's income but, if you do [claim benefit], you need to declare your partner's income.

The Finance Act makes a few minor changes to tax rates and tax laws, yet the UK taxation system is horrendously complex. Rates could be set for three years with one Finance Act every three years.

Such unnecessary bureaucracy and form-filling has permeated through all government departments in the past 20 years where no real work is done and everyone is checking and ticking boxes to verify one another's work. A huge amount of glossy brochures and leaflets are published that no one reads.

One can go on and on. When you spend £50 to process an order to purchase a £3 hammer, of course you are going to need ever more government staff to handle the systems and procedures. It is all waste and it is not real employment with growth potential for any country.

One final example is dividend income. Thousands of shareholders now have very few shares in privatized companies which continue to issue cheques and dividend vouchers for a few pence every six months. Surely any cheque issued for less than £10 is a complete waste if you count all the processing costs involved. Again, the entire country's financial accounting and reporting system without making the slightest difference in the results.