Today I attended a Babergh District Council Meeting. The agenda was fairly varied and included the Mid Year Report on Treasury Management. This is usually nodded through as it can be quite technical and there should be few changes – since the policy is in place and it is the Officer’s job to stay within the guidelines and report the when and why of guidelines being breached.
Page six of the report revealed that the Council has opened a custody account with King & Shaxson. The name rang a faint bell so I asked who they were. And useful answer came there none. You would have thought that the person introducing the paper would know who King and Shaxson were – especially as he was effectively recommending them as a conduit for our excess funds. If he didn’t know you’d have thought that he would have asked. Did he read the Council papers and get himself properly briefed before coming to the meeting? Or was it shyness which prevented him from asking the questions. The lack of knowledge and information broke the first rule of looking after other people’s money – would you put your own money there?
As it was we didn’t know whether King & Shaxson were up there with Marks & Spencer or lurking in the shadows like Burke and Hare.
Just in case anyone is interested , King & Shaxson is a long-established City name, with a history that goes back to the mid-nineteenth century it is owned by PhillipCapital, a Singaporean financial services company.
Perhaps more importantly from our point of view they are listed by the Debt Management Office (DMO) of the UK Treasury as a primary participant in the Treasury bill market enabling them to bid, on behalf of investors, at Treasury bill tenders.
More information may be found on http://www.kingandshaxson.com/CorporateProfile.aspx
Meanwhile I try not to despair of the people who aspire to lead me and look after my interests.
Money Matters
Hadleigh Local Shopping Loyalty Card
Whilst many major companies are lawfully avoiding UK taxes, they are nevertheless depriving our Exchequer of the revenues needed to provide the services and building we need – and they are also attacking our own home grown business which find it difficult to compete against people who pay little or no tax. So it’s no more Starbucks for me. In future I’ll look for Costa (owned by Whitbread).
I’m going to try to give up Amazon and instead use our local bookshop The Idler.
Hadleigh has its own Local Shopping Loyalty Card. Collect a card and get it stamped ten times by local participating retailers (look for the window decals). Hand in the card when completed and participate in a monthly cash draw (£250 in December). If we do not support our local shops – then one day they will not be there.
Beyond Comfort Food
I was in London and passing through Liverpool Street station and feeling in need of comfort food I stopped by the Pasty Shop and chose a steak and stilton Cornish pasty. It was only as I was walking away that I noticed that in addition to the usual varieties available (lamb with mint, etc.) they also had a pasty filled with fish, chips and mushy peas – all the necessary vital foods for life. Certainly something to put on the list for next time.
In the meantime my favourite council is embarking upon a series of consultations. One of which focuses on the support we give to families with their Council tax and rents. We will be abolishing the discount for second homes (if you can afford a second home you can afford the council tax!) and also we (the taxpayer) will not be paying for houses which have an above average assessment. (Large families would be accommodated by other pockets in the benefits system).
A survey by the Taxpayers Alliance has discovered that super-sized families are being housed by councils across the country in huge mansions that many mortgage payers could only dream of. The biggest council house provided was a 10-bedroom abode in Southwark, while East Riding Council placed a family into a nine-bedroom home in Bridlington. Robert Oxley of the TaxPayers’ Alliance said: “This is why the Government must press ahead with its proposed cap on housing benefits”.
Patience Wheatcroft in Monday’s Evening Standard makes the interesting point that most business people would say that what they want most is for government to provide a stable, low-tax environment, and educated and properly skilled workforce, and then get out of the way. Which I can go along with, provided we have adequate safeguards for people and their environment – otherwise we might just as well start breeding smaller children so as to facilitate chimney sweeping and provide employment.
Tilting at Windmills
Whilst in Paris we took the opportunity to treat ourselves to the International Herald Tribune which combines the New York Times news services together with features and articles from elsewhere. It made a refreshing change from the U.K. national papers and we did consider swapping our Telegraph subscription for the I.H.T., relying on the internet for more U.K. centred news.
One breakfast meeting was made joyful by the news that Spain is bidding to host the Olympic Games in 2020. A Wall Street Journal article contained the following extracts:
·“We need two different things: power for the economy and an element of enthusiasm for the population,” Víctor Sánchez, managing director of Madrid 2020,
·Skeptics point out that Madrid is among the most indebted cities in Spain. Ratings firm Fitch recently downgraded Madrid’s regional government, predicting its debt could more than triple—to €23.7 billion ($29 billion)—in 2014 from 2010. The country’s economy, meanwhile, is enduring a double-dip recession and the government is pushing through a €65 billion austerity program.
·“This is not the moment to be thinking about this kind of event,” says José García Montalvo, an economics professor at Barcelona’s Universitat Pompeu Fabra.
·”In these bid documents, there is always an element of unreality,” says Matthew Burbank, a political-science professor at the University of Utah who studies the Olympics.
·The IOC gave Madrid the best score of all three finalists, but added: “Careful monitoring of Spain’s progress on economic issues is needed to further assess future risks of delivery.”
It’s good to see optimism combined with ambition in these dark days. On the other hand the lunatics are thinking that they may be in charge of the asylum. The full article may be viewed on:
http://online.wsj.com/article/SB10001424052702303644004577524684025592386.html
Watching the Gimbals
There’s a continuous theme in the film Apollo 13 where Mission Control 
is telling the crew to watch their gimbals. The gimbal being a device which indicates balance. There are many parallels in our other lives. Where was the balance in the Spanish banks? Deposits control your ability to lend and your asset and liability policies control what you can do with the money. Which is why the Spanish banking crisis is interesting as the asset policies obviously did not specify a prudent limit on financing speculative building. This week I attended a Revenues and Benefits Committee meeting. This committee comprises representatives from the three partners (Babergh, Mid Suffolk and Ipswich Borough Councils) and the Management of the Revs and Bens Joint Venture. The management report advised of that annual costs were ahead of budget and that technical and integration issues were being worked through. So three cheers all round. However a disturbing picture emerges when you look at the “customer related ” performance trends. The accuracy of benefit processing over the year (for Babergh) was 96.2% in April 2011 and 87.5% in April 2012 which indicates that in 2011 the reject rate was one in twenty six and in 2012 it was one in eight! The worst month for accuracy was February when only 78.3% of the benefit processing was accurate. Similarly the time taken to process new claims deteriorated from 19 days to 34 days. Why is it that the drive for efficiency afflicts the disadvantaged and vulnerable – that’s why they are on benefits? Meanwhile it has been suggested that I talk to the Head of the Shared Revenues Partnership and I look forward to the next meeting of the Committee in July. What about the gimbals? Well when you concentrate on the wrong things you’re liable to be found on the wrong side of a mis-match when Nemesis catches up with Hubris.
The Last Gunfight
I have just read The Last Gunfight by Jeff Guinn. The book details the circumstances leading up to the Gunfight at the O.K. Corral. There are various strands which lead up to the gunfight. The ambitions of the Earp family to find their fortunes. The similar aims of other lawmen, ranchers and cowboys. The play of politics in the election of officials (sheriffs had responsibility for collecting taxes for which they kept a percentage), philosophical views of governance (too much or not enough government) and the desire of the Tombstone businessmen to have a nice town whilst still parting rowdy cowboys from their money. The gunfight produced the immediate deaths of Billy Clanton and Tom and Frank McLaury. The Earps came out of the inquest with their actions being excusable and justifiable by law. The gunfight and the inquest did not stop the animosity between the Earps, Clantons and the cowboys. The book infers that the Earps finally lost patience with their enemies, tracked them down and executed them. In most cases this was permissible as there were outstanding warrants against their enemies. The book has a number of interesting vignettes but my favourite quote is from the historian John E. Ferling “events by themselves are unimportant; it is the perception of events that is crucial”. The shoot out was an arrest gone wrong and the result of complicated social, economic and political issues which left eight men dangerously mistrustful of each other. A very good read and a healthy antidote to the glamourisation of the Wild West.
Spanish Practices
Early in 2010 Babergh District Council decided that it was time that we had a formal Treasury Policy. We had avoided placing surplus funds with the Icelandic banks and it was right that the Council formalised its deposit placing policy. A consultant’s report was commissioned and presented to the Overview & Scrutiny Committee (Stewardship). Strangely it suggested that placing deposits with Spanish banks would meet the Council’s requirements for prudency. There was a fair amount of argument and full Council finally decided that if the Consultant said so, it must be OK! No suggestion that there were other persons on the council who were equally in tune with economic trends and who thought that the Spanish economy was over ripe. Within three weeks of the Council’s decision the Spanish economy was downgraded and any deposit placing with any branch or subsidiary of Santander was prohibited.
Where Babergh leads other Councils follow. The digital version of MJ (presumably an updated name for the Municipal Journal) reports that “Several local authorities are considering whether to deposit money with the British arm of Spain’s biggest bank Santander, amid fears about the weakness of the Spanish economy”.
The full article can be found on http://www.themj.co.uk/MemberPages/Subscribe/article.aspx?id=188729
It’s hard to be humble!
Episcopalian’s Guide to Airport Security
Today’s Daily Reckoning (e-mail publication by Moneyweek) contains an article by Bill Bonner first published on 3 June 2002 discussing airport security and from there to why the policy of attacking enemies first tends to be flawed.
Historically Bonner refers to Napoleon and Hitler but the sub text is Iraq. The article is (as usual) well written and contains the following gem:
common sense finds few buyers… while absurdity is over – subscribed.
The full article is found on http://www.moneyweek.com/news-and-charts/economics/us/bill-bonner-the-episcopalians-guide-to-airport-security-21400
Small Successes
Today’s meeting of Babergh District Council’s Overview and Scrutiny (Stewardship) Committee was a quite sparky meeting with much debate focussing on the Finance, Risk And Performance Management – Quarter 3 Monitoring Report (35 pages of facts and figures). The general complaint was that although we are told when targets are not being met – we are not told what is being done to correct the position. Cynics would say that the mushroom principle applies. The view being that it is not the Councillors’ role to understand what is going on but merely to note (and if appropriate approve) the reports. But deep in the data is the wonderful news that Babergh Matters (The Council’s publication for residents –sometimes up to 24 pages of photos and pufferie) has not been published this financial year generating a saving of £41,000. It’s possible that the £41,000 could be carried forward into 2012/13. But a saving is a saving and I have campaigned against the publication since I was first elected in May 2007. Consequently my day was cheered up immeasurably.
FIND (Families in Need)
Tomorrow (Saturday) 
FIND (Families in Need) is holding a fund raiser at St. Mary’s Church Hadleigh from 10 until 2. With the current changes in the economy FIND is having to provide basic necessities like food to families in need. This is a local charity which deserves our support. If you’re free and in Hadleigh on Saturday, drop in to the church and see what’s happening. Short term (three hours) car parking in Hadleigh is free until noon on Saturdays. Thereafter parking is free for all of Saturday afternoon and evening. If you are visiting Hadleigh be careful of using the long term car parks which although they are also free for the first three hours will require a parking ticket up to 5 p.m. FIND is a Christian based charity that was founded in 1990 to provide emergency assistance to families or individuals affected by poverty or dispossession. FIND is also able to offer ongoing friendship and support to those in need. WHAT DOES FIND OFFER? The charity provides, free of charge: food; cooking utensils; clothing, toiletries; baby equipment & nappies; bedding; survival sleeping bags; curtains & furniture; white goods; Christmas hampers & gifts, etc. FIND also befriends people without judging them, offers advice when required and gives support for as long as it is needed. WHO DOES FIND HELP? Anyone living within 25 miles radius of Ipswich who is deprived of a minimum standard of living, be they single, families, lone parents, children, elderly, sick or disabled. Referrals may come from: Social Services; General and Psychiatric Hospitals; The Homeless Family Unit; Victim Support; Salvation Army; Asylum & Refugee Support Agencies; Women’s Aid; The Probation Service; YMCA & YWCA; Ipswich Community Resource Centre; Family Centres; Health Centres; other charities.
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