Chancellor for the Day: Lord Digby Jones

The former CBI head and Trade Minister says what he'd do with a day spent in Alistair Darling's shoes...

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Last Updated: 31 Aug 2010

0530 Jump out of bed with a spring in my step and happy anticipation in my heart because the first thing on the Agenda is the most important any Chancellor can do: get out and meet real businesses employing real people facing real problems and... listen!  How do you know what to change if you haven't gone out, listened and understood?  First things first... manufacturers of Britain, here I come.

0900 Abolish National Insurance - it's really Income Tax, so call it such. Create a composite rate of Income Tax. Abolish National Insurance completely for employers; it is an insidious tax on jobs not profits. Receive a delegation of officials saying ‘Very brave, Minister!'

1000 No one whose total earnings do not exceed £12k p.a. should pay Income Tax at all.  Abolish all personal allowances. Ignore the bleat of ‘too difficult to implement, Minister,' coming from my officials.

1100 Abolish all allowances and reliefs for corporation tax and reduce its rate to one single, flat rate. Simple to use, easy to understand and cheap to collect. Listen to my senior official saying ‘Unworkable, Minister'.

Noon (lots to do... so little time in which to do it) Repeal the divisive, poorly-cobbled-together and counter-productive Non-Dom tax. Those wealth creators are very welcome in our open, pluralistic society and our actions should follow our words. In any event, it won't raise the sums both parties think it will. Hear ‘Don't blame us, blame the newspapers' echo down the corridor.

1300 Create a skilled job-subsidy scheme on a temporary basis for the automotive manufacturing sector. When this crisis is over, Germany and France, India and China will have a reservoir of skilled talent ready and available for the next wave of wealth-creating investment. The UK will have seen its skilled people move into the public sector or into the esteem-destroying, health-destroying, community-destroying world of long-term unemployment. A three-way sacrifice by employer, employee and taxpayer keeps the skills in the business ready for productive use in our economy as the upturn comes. It is so much cheaper than paying out benefits as well.

1400 Reinstate a VAT rate of 17.5% (and think about raising it to 20% over the next two years). What is the point of spending £12bn on reducing the price of  ‘stuff' when people not in work won't buy it anyway?

1500 Reinstate overseas development aid from the UK taxpayer being linked to work, jobs and business for the UK. Our money rightly goes to help those in the world so much worse off than ourselves but (unlike any other major nation) it pays for other countries to get the benefit in resulting business opportunities and not us, the donor. It also facilitates corruption precisely where it should be eradicated. Untied aid is, of course, desirable - but only when we all do it! Listen to a SPAD (Special Adviser) saying: ‘The Party won't like it Minister.'

1600 Increase the funding to further education, to raise the vocational skills of the country's young people and remove the cap on top-up fees at Universities so that our world-class higher education system can compete globally in the 21st Century.

1700 Increase the funding for UKTI (UK Trade & Investment). The country has to trade its way out of this crisis and we need to be promoting Brand Britain in every market, especially helping small businesses export. Get behind the UK defence manufacturing sector with a specially-targeted grant to assist overseas sales and increase R&D in this vital sector.

1800 Now for the easy bit... How to pay for it all. Having simplified Income Tax, and  Corporation Tax and having abolished National Insurance, the headcount at HMRC can be hugely reduced. Also, maintaining the teachers, the nurses and the police but substantially reducing the numbers in the back office is long overdue. Change the way government is delivered and you can do the job with a lot fewer people and places.

1900 Indulge in a bit of populism and save tax pounds at the same time. Go on national TV and announce the end of the pensions apartheid in the UK. End the unaffordable, socially-divisive and totally unfair public sector pensions regime and save the country a fortune.

2000 Pop next door and chat things through with the Boss. He's been spending the day telling Brussels there is no more money until the EU accounts are audited properly and are not qualified. He's also been signing the WTO Doha round for development and trade on a scale that will really change the world for the better.

2200 Feet up, night cap in hand, chat through the day with Pat then watch the highlights of tonight's victory by Aston Villa in the Champions League and Leicester Tigers winning the World Rugby Club Championship!

2300 The end of a perfect day...

Lord Digby Jones is a business ambassador for UK Trade and Investment.


In today's bulletin:
No surprises as Bank holds rates at 0.5%
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Chancellor for the Day: Lord Digby Jones
Not so flexible after all?

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