725,000 public sector jobs face axe, economist warns

Norfolk_Jim

ILW wrote: »

I do not think the banks should have been allowed to get to the point where the govenment had to bail them out or see the economy collapse. The bail out was another example of the taxpayer being shafted due to the incompetance of the regulators and civil servants who should have stopped it from happening. Again most of them are still in their jobs drawing salaries from the state.

Isnt that just the price you pay for having a free market economy? The banks decide that gambling was the way to go for profits. The Government, knowing how much we depend on the banks and the City of London in general for our economy (Having let manufacturing go and concentrated on service industries) wouldnt want the banks to be regulated sufficiently tightly to have prevented the banking crisis as banks would simply get their way with threats of moving their operations to Frankfurt or New York or the Cayman Islands if it suited them. We walk a severe tight rope with regulation - too much and the regulated relocate.
Ever since Visa came on the scene I realised we were building an economy based on ever increasing debt. That was clearly an unsustainable model with the only questions being when would the bubble burst and what would be the consequences.
Incidentaly, I wonder how many big earners wherever they are are actually worth their salary? Is someone on 250,000 a year really 10x the person another on 25,000 is? Are they really 10x brainier, cleverer or harder working.

marklv

ILW wrote: »

Typical pie in the sky public sector argument. Retire all at 55. I would suggest that is fine as long as there is a suitable reduction on pension payments, You will probably not agree.
Also why should a civil serveant get any more than statutory redundancy pay if made redundant? That is is the type of thing that dismays taxpayers.

All this about pensions and redundancy payouts was agreed decades ago in contracts. The government can't change them now to suit its own ends - the unions recently won a court case on this. As for SRP, most private sector employers offer a lot more than that and you know it.

Kohoutek

lemonjelly wrote: »

I responded by highlighting that the banks/financial services have cost the taxpayer an estimated £850bn. Ergo they are not wealth creators, but a drain on resources.

The financial sector is not supposed to be a 'wealth creator' per se, its function is to allocate capital to the economy by providing credit. Unfortunately sometimes it seems like the rest of the economy is working for the financial sector, rather than the financial sector providing a service to the productive economy.

Norfolk_Jim

I have to go to work now - have fun everyone

marklv

ILW wrote: »

If it is found that 1M people are in jobs with no value, would it still be lunacy?

There are probably 1M private sector jobs with no value.

JasonLVC

As an aside, Capita get all the jobs becuase Capita were a small business until they donated £1m to Tony Blair's election pot.

http://www.thisislondon.co.uk/news/article-23373219-labour-donor-landed-role-as-adviser-to-brown-thanks-to-dirty-secret.do

In the story, Capita owns a public sector recruitment firm called Veredus which has the contract for high level legal and professional appointments which means it is hardly neutral in putting forward candidates for certain top level government posts.

The CEO stood down after further allegations that his £1m donation seemed to lead to winning all sorts of Government contracts to provide infrastructure, social care, london congestion charge, etc. Profits grew from £12.3m in 1996 to £258.1m last year :eek:so that £1m was money well spent :-

http://news.bbc.co.uk/1/hi/uk_politics/4836024.stm


Still, Capita shares tumbled once the new Tory government announced massive cuts in contracted out services :-

http://www.channelregister.co.uk/2010/05/24/capita_shares/

I'm not having a go at Labour, just presenting the opinion as to maybe why the private sector got so involved with the public sector (and why that gravy train is coming to an end, hopefully).

ILW

marklv wrote: »

There are probably 1M private sector jobs with no value.

True, but generally I dont have to pay for them if I don't want to.

scrappy2000

Wouldnt it be better to keep people in work?...rather than having them join the dole queue?.....if the government keeps people in work then they are contributing to the economy surely....not taking from it

marklv

What a lot of people here seem to forget is that the public sector is destined for several years of pay freezes. This alone will save billions for the government. Thus there is no need to do anything extreme like mass redundancies.

tomterm8

Um, we don't forget that. They will also adjust pensions, holiday entitlement, and institute recruitment freezes. They will freeze most new capital spending. They will also freeze all benefit entitlements. And probably adjust job seekers allowance.

This is all a drop in a £150 billion hole, though.

The economist knows all these things... and is predicting 750,000 job losses. I would guess maybe half this number would be as a result of recruitment freezes and compulsory retirement.