WEBVTT - How Much Could Andy Burnham Cost You? 0:00:02.720 --> 0:00:18.880 Bloomberg Audio Studios, Podcasts, Radio News. Welcome to Merrin Talk's 0:00:18.920 --> 0:00:22.000 Your Money, the personal finance edition of Merin Talk's Money 0:00:22.000 --> 0:00:24.720 and these bonus podcasts we talk about the best strategies 0:00:24.720 --> 0:00:27.520 for making the most of your money. I'm Merin Dumbsup, 0:00:27.520 --> 0:00:30.880 Web editor at Large for Bloomberg UK Wealth Now. This 0:00:30.920 --> 0:00:33.800 week kicked off with some drama in British politics and 0:00:33.800 --> 0:00:36.960 a particular surprise there. Following Andy Burnham's victory in the 0:00:36.960 --> 0:00:39.880 Makefield by election and growing brother from Labor and Peace 0:00:40.040 --> 0:00:44.400 Kiss someone announced his resignation as Labor leader and Prime Minister. 0:00:44.840 --> 0:00:47.720 Burnham quickly confirmed what we already knew, which is that 0:00:47.760 --> 0:00:50.559 he would be seeking the leadership and that is widely 0:00:50.600 --> 0:00:54.160 expected to happen in the next few weeks without much 0:00:54.200 --> 0:00:57.440 of a contest. So we imagine that Andy Burnham will 0:00:57.480 --> 0:01:00.800 be the next Prime Minister. And the question then is 0:01:00.880 --> 0:01:05.520 what will Britain look like under Andy Burnham? And more importantly, 0:01:05.720 --> 0:01:11.000 what will it mean for your money? Spoiler probably nothing good. 0:01:11.400 --> 0:01:13.600 With me to help explore that question, It's Philip Alderic, 0:01:13.600 --> 0:01:18.920 senior reporter covering the UK Cony for Bloomberg News. Phil Welcome, 0:01:19.080 --> 0:01:20.560 thank you for joining us today. 0:01:21.080 --> 0:01:22.440 Good to be here, right. 0:01:22.640 --> 0:01:26.119 The first thing to say, I guess is that assuming 0:01:26.800 --> 0:01:30.160 that Andy Burnham is going to stick to the fiscal rules, 0:01:30.200 --> 0:01:32.040 which he has said he is going to do, that 0:01:32.160 --> 0:01:35.399 leaves him with very little immediate wiggle room. Right. 0:01:35.800 --> 0:01:38.720 Yeah, I mean, we've got twenty three billion of headroom 0:01:38.959 --> 0:01:41.240 that Rachel Reeves left us with, which itself was a 0:01:41.240 --> 0:01:45.200 relatively small amount of headroom. Unless he gets really lucky 0:01:45.240 --> 0:01:48.400 with growth. Yeah, he's going to He's really got very 0:01:48.440 --> 0:01:51.120 few options at the end of the parliament. Most of 0:01:51.160 --> 0:01:53.840 the hard work is going to be done with these 0:01:54.280 --> 0:01:57.600 frozen tax thresholds, which are going to really irritate most 0:01:57.880 --> 0:02:01.400 of the electorate. So you can't see them the government 0:02:01.440 --> 0:02:03.880 pushing through that, even a Burnham government pushing through with 0:02:03.960 --> 0:02:05.760 something which is going to be some unpopular right before 0:02:05.760 --> 0:02:06.440 a general election. 0:02:07.120 --> 0:02:09.120 Yeah, I mean, I suppose the first thing we should 0:02:09.120 --> 0:02:11.840 actually do is just remind everybody roughly what the fiscal 0:02:11.919 --> 0:02:14.640 rules are, right, which is that you correct me if 0:02:14.639 --> 0:02:18.320 I'm wrong this You're the technical guy here, not me. One. 0:02:18.360 --> 0:02:21.480 That we need to be pushing towards the budget surplus 0:02:21.480 --> 0:02:24.360 by twenty nine thirty, so that spending is in surplus, 0:02:24.360 --> 0:02:26.200 although there's that sort of fluffy bit around what is 0:02:26.240 --> 0:02:29.760 spending and what is investment right, And the second major 0:02:29.800 --> 0:02:33.040 one is that public debt is a percentage of GDP 0:02:33.200 --> 0:02:36.000 needs to be beginning to trend down by twenty nine thirty, 0:02:36.360 --> 0:02:39.040 and looking at where we are now, that seems to 0:02:39.160 --> 0:02:41.880 be verging on impossible. And we had the the May 0:02:41.919 --> 0:02:46.000 borrowing numbers were horrible, weren't they much higher than expected? 0:02:46.080 --> 0:02:49.560 And nearly twelve billion pounds in May spend on interest 0:02:49.600 --> 0:02:51.919 on our debt alone, which is horrible. So you look 0:02:51.919 --> 0:02:54.720 at this stuff and you think, well, even if the 0:02:54.840 --> 0:02:57.360 Parma government had hung on and Reeves had hung on, 0:02:57.760 --> 0:03:00.959 this was still going to fail come twenty nine thirty 0:03:01.160 --> 0:03:04.079 unless there was a massive spending squeeze or some sort 0:03:04.120 --> 0:03:08.880 of bizarre boosting growth, which seems inconceivable. So that was 0:03:08.919 --> 0:03:09.800 already going to fail. 0:03:10.280 --> 0:03:13.120 Well, I mean, I think the only thing I caution 0:03:13.200 --> 0:03:15.400 there with is obviously the situation right now in the 0:03:15.440 --> 0:03:17.200 middle of the Irm war, and not all price spike 0:03:17.240 --> 0:03:19.360 et cetera. The inflation's picked up, so a lot of 0:03:19.360 --> 0:03:22.919 that may just be a temporary spike. The underlying state 0:03:22.919 --> 0:03:25.680 of the public finances does remain pretty dire. It was 0:03:25.720 --> 0:03:28.760 going to be very difficult for Starmer to deliver the 0:03:28.800 --> 0:03:32.000 fiscal rules and get growth going and get your investment 0:03:32.120 --> 0:03:35.600 up because there are so many pressures on all sorts 0:03:35.640 --> 0:03:36.760 of public spending at the moment. 0:03:37.040 --> 0:03:41.040 Okay, So let's assume that it is going to be 0:03:41.040 --> 0:03:43.400 Andy Burnham, of course, not absolutely certain yet that there 0:03:43.440 --> 0:03:46.480 could be a contestant. Then we get all kinds of 0:03:46.480 --> 0:03:48.800 spending commitments checked in from everyone trying to win, and 0:03:48.840 --> 0:03:51.000 everything gets what rather worse than we think. But let's 0:03:51.040 --> 0:03:53.400 assume that not going to happen. We have an orderly 0:03:53.480 --> 0:03:57.760 transition the bond market and the equity market. Figure that's 0:03:57.880 --> 0:04:00.360 kind of okay, because fiscal rules something some and so 0:04:00.440 --> 0:04:05.760 that all stairs relatively calm. When we look at what 0:04:05.880 --> 0:04:12.200 Burnamus talked about, He's talked about things like looking again 0:04:12.520 --> 0:04:16.960 at the freezers on income tax allowances. He's talked about 0:04:17.520 --> 0:04:23.200 reconsidering the inheritance tax charges on farmers. He's looked at 0:04:23.600 --> 0:04:26.640 talked about cutting business rates down for pubs and listening 0:04:26.800 --> 0:04:31.160 lifting threshold for small businesses. He's talked about reversing the 0:04:31.240 --> 0:04:34.920 rise in employers national insurance. But all these things would 0:04:34.960 --> 0:04:37.679 be marvelous because all of them have been fairly nasty 0:04:37.760 --> 0:04:40.880 drags on growth and on sentiment in the UK. But 0:04:41.120 --> 0:04:45.000 going back to this idea that there's very little room 0:04:45.600 --> 0:04:48.599 to do anything, it seems inconceivable that he could possibly 0:04:48.680 --> 0:04:53.320 do those things without also introducing new taxes, perhaps on wealth. 0:04:53.680 --> 0:04:57.039 Yeah, I mean, it's implausible to think that he can. 0:04:57.120 --> 0:04:59.640 He can make all these all these tax cuts for 0:04:59.680 --> 0:05:03.120 particicular sections of society and to help ease some of 0:05:03.160 --> 0:05:06.960 the pressures that on business without you know, without recovering 0:05:06.960 --> 0:05:08.839 the money from elsewhere. And we've and we've seen that 0:05:08.960 --> 0:05:10.960 no spending cuts seems to be it seemed to be 0:05:11.000 --> 0:05:14.200 pretty undeliverable in under this government with and you know, 0:05:14.880 --> 0:05:17.680 the makeup of the labor governments or the Labor Party, 0:05:18.000 --> 0:05:22.360 with the backbench rebellions still sort of brewing. Whenever there 0:05:22.440 --> 0:05:24.280 is talk of a spending cut, it's going to be 0:05:24.320 --> 0:05:27.440 the same problem that burn And faces in regard to that. So, yes, 0:05:27.640 --> 0:05:29.120 if there's going to be a tax cut, there's going 0:05:29.160 --> 0:05:30.800 to be a tax rise to pay for that tax cut. 0:05:30.839 --> 0:05:33.320 That that's the way if he's if he is honestly 0:05:33.360 --> 0:05:36.040 going to stick to the fiscal rules that Rachel Reeves 0:05:36.080 --> 0:05:39.039 is introduced, then, yeah, somebody is going to bear some 0:05:39.240 --> 0:05:41.880 pain to ease the pain on someone else. 0:05:42.200 --> 0:05:44.240 Looking at whether there's risers might come, and one of 0:05:44.240 --> 0:05:47.360 the things that he has previously suggested is reintroducing the 0:05:47.480 --> 0:05:51.080 fifty p rate of tax on higher earners. 0:05:51.279 --> 0:05:53.279 Doesn't make any money. I mean it doesn't. It never 0:05:53.320 --> 0:05:55.440 makes doesn't touch the size, does it, really. 0:05:55.640 --> 0:05:58.120 It doesn't touch the size. There was a wonderful article 0:05:58.120 --> 0:05:59.720 on the one of the papers at the weekend. I 0:05:59.760 --> 0:06:02.440 don't know if you saw it, and about gosh, I 0:06:02.520 --> 0:06:04.360 don't know, seven or eight years ago, ten years ago, 0:06:04.400 --> 0:06:07.839 whenever it was Scottish referendum, I write an article saying 0:06:07.920 --> 0:06:10.240 that taxes were going to go up in Scotland and 0:06:10.240 --> 0:06:13.000 that one should rush out and buy houses in Northumberland, 0:06:13.000 --> 0:06:14.919 just on the border, because that's where everybody would go. 0:06:15.400 --> 0:06:17.520 You know, the top rate of tax in Scotland is 0:06:17.560 --> 0:06:21.000 now forty eight percent and here's the headline, Scottish tax 0:06:21.080 --> 0:06:25.039 exiles flood into Northumberland. Families fleeing the SMP's higher rates 0:06:25.040 --> 0:06:28.760 are driving up president in Northumberland. So you know, fifty pm, 0:06:28.760 --> 0:06:30.240 we'd all be going the other way. 0:06:30.360 --> 0:06:33.000 Yeah, exactly, yes, gif for Scotland it would be a 0:06:33.040 --> 0:06:37.040 symbolic gesture rather than an attempt to reduce the constraints 0:06:37.080 --> 0:06:39.400 that he has, his fiscal constraints that he has. I 0:06:39.440 --> 0:06:41.680 think he's also talked about sort of doing the council 0:06:41.760 --> 0:06:46.040 tax revaluation. That again would be a shift in the 0:06:46.080 --> 0:06:49.880 balance of taxes because people in the borer regions would 0:06:50.160 --> 0:06:52.720 pay less than people in London, and the wealthier regions 0:06:52.760 --> 0:06:54.960 would end up paying more because their houses were valid 0:06:54.960 --> 0:07:00.240 more then, so that would be a redistributive operation. But 0:07:00.320 --> 0:07:02.960 he could you can also attach to that some some 0:07:03.120 --> 0:07:06.120 form of net tax increase as well, so I could 0:07:06.160 --> 0:07:08.880 you know, I could imagine him him doing something like that. 0:07:08.920 --> 0:07:11.080 And he's also talked about I mean, in the past 0:07:11.120 --> 0:07:14.160 he talked about ten percent inheritance tax on I think 0:07:14.560 --> 0:07:16.800 on all inheritance. So we've obviously got them, you know, 0:07:16.960 --> 0:07:19.520 up to a million pound before you you end up 0:07:19.560 --> 0:07:24.040 getting HD being incurred with inheritance tax. So and that 0:07:24.080 --> 0:07:26.080 he talked about that was in relation to social care 0:07:26.120 --> 0:07:28.840 in the past. So again that's a that could raise 0:07:29.080 --> 0:07:30.920 you know, substantial sums of money and as you said, 0:07:30.960 --> 0:07:33.160 is effectively a tax on inherited wealth. 0:07:33.720 --> 0:07:35.400 And that would be interesting because one of the things 0:07:35.400 --> 0:07:38.360 that people worry about all the time, absolutely NonStop is 0:07:38.400 --> 0:07:41.720 inheritance tax, even people whose estates will never fall into 0:07:41.760 --> 0:07:44.240 the inheritance tax, whereas you worry about it all the time, 0:07:44.280 --> 0:07:46.440 and suddenly he'd give them good reason to worry about it. 0:07:47.040 --> 0:07:48.760 Yeah, and the last time they worried about it was 0:07:48.800 --> 0:07:52.840 with Terre's and May's dementia taxes, as Labor branded it 0:07:52.880 --> 0:07:56.800 back then, and it cost her majority, didn't it. So 0:07:56.880 --> 0:07:59.080 it's obviously, as we all know, it's the least one 0:07:59.080 --> 0:08:02.520 of the least popular time. This is the thing. There 0:08:02.600 --> 0:08:05.360 is economic restraint and then there's political constraint, and the 0:08:05.400 --> 0:08:08.480 two are sort of operating hand in hand. The physical 0:08:08.520 --> 0:08:10.760 situation rather than the fiscal rules in the UK is 0:08:10.800 --> 0:08:13.239 itself a massive constraint, and then the efforts to actually 0:08:13.280 --> 0:08:15.160 try and fix that have proved to be a huge 0:08:15.200 --> 0:08:18.320 political constraint. So you end up just in complete stalemate. 0:08:18.360 --> 0:08:21.840 And that's the big challenge for Burnham is how he 0:08:22.000 --> 0:08:24.920 breaks that stalemate where Starmer was unable to well. 0:08:24.920 --> 0:08:27.280 I suppose Ah could be super strong and just get 0:08:27.320 --> 0:08:29.920 on with it, But the obvious route then is to 0:08:29.920 --> 0:08:31.440 try and go down as we were just saying with 0:08:31.480 --> 0:08:33.520 the inheritance tax to try and go further down the 0:08:33.559 --> 0:08:36.840 wealth tax route, and he has talked about, for example, 0:08:37.480 --> 0:08:41.199 equalizing the rates on income tax and capital gains tax, 0:08:41.240 --> 0:08:44.280 which sounds very attractive to lots of people, but of 0:08:44.320 --> 0:08:48.920 course is fairly outrageous because that's an absolutely massive wealth tax. 0:08:49.120 --> 0:08:51.120 So when the rates of capital gains tax were were 0:08:51.160 --> 0:08:54.680 cut previously under Gordon Brown to what today's relatively low 0:08:54.679 --> 0:08:56.920 sounding levels, one of the things had happened at the 0:08:56.920 --> 0:08:59.960 same time was the removal of the indexing to inflation. 0:09:00.360 --> 0:09:02.319 And because the rates were lower, that was sort of 0:09:02.360 --> 0:09:06.160 vaguely acceptable because you're no longer you're paying a lower rate, 0:09:06.240 --> 0:09:09.080 but you're paying tax on your inflationary gains as opposed 0:09:09.120 --> 0:09:12.199 to your real gain. It was kind of a reasonable compromise. 0:09:12.600 --> 0:09:15.240 But if you were to put capital gains tax rates 0:09:15.360 --> 0:09:19.280 up to income tax rates without taking into account inflation, 0:09:19.760 --> 0:09:21.720 you have introduced, I mean, it's a wealth tax at 0:09:21.760 --> 0:09:25.160 the moment, but you would have introduced a massive wealth tax. 0:09:25.520 --> 0:09:28.560 And that we have few enough of our rich happily 0:09:28.600 --> 0:09:30.240 staying in the UK at the moment, this would be 0:09:30.320 --> 0:09:33.800 something I suspect that would really drive up departures. 0:09:34.120 --> 0:09:36.520 I mean a lot of small business owners. They make 0:09:36.559 --> 0:09:41.400 their money through taking capital gains on the businesses that 0:09:41.760 --> 0:09:44.520 the profits that they've made and the gains that they've made. 0:09:44.640 --> 0:09:46.760 I think people in general would see it as unfair 0:09:46.840 --> 0:09:49.559 if you had a capital gains tax which was unadjusted 0:09:49.559 --> 0:09:54.040 for inflation. Obviously, the people who are defending the idea 0:09:54.120 --> 0:09:56.319 will point back to Nigel Lawson in the nineteen eighties, 0:09:56.360 --> 0:09:58.840 and that was when capital gains tax was last The 0:09:59.000 --> 0:10:02.440 rates were drawn to be equivalent to the income tax rates, 0:10:02.600 --> 0:10:04.320 and so you know, there is a sort of you know, 0:10:04.360 --> 0:10:06.240 the labor can say, oh, well, the Tories did it, 0:10:06.280 --> 0:10:09.280 but of course back then there was the inflation adjustment. 0:10:09.960 --> 0:10:12.559 And the Liberal Democrats say in the election manifesto, in 0:10:12.600 --> 0:10:15.160 their election manifesto in twenty twenty four, they had something 0:10:15.200 --> 0:10:17.679 similar where they wanted to they wanted to harmonize the 0:10:17.760 --> 0:10:21.000 rates but with the income tax rates, but they would 0:10:21.000 --> 0:10:24.320 introduce in inflation adjustments. So for your thinking about doing this, 0:10:24.760 --> 0:10:26.400 you either do it the way he wants to do 0:10:26.440 --> 0:10:28.400 it and just irritate so many people that it will 0:10:28.440 --> 0:10:31.600 backfire inevitably, or you do it in a way The 0:10:31.640 --> 0:10:34.920 Liberal Democrats were suggesting which ends up raising you know, 0:10:34.960 --> 0:10:37.439 after behavioral adjustments or whatever. It only ends up raising 0:10:37.480 --> 0:10:39.160 it three or four billion, which is nice to have, 0:10:39.240 --> 0:10:41.800 but it doesn't solve everything. So it's not a big 0:10:42.040 --> 0:10:43.520 you know, it's not a big bazooka. 0:10:43.640 --> 0:10:45.199 Yeah, I'm One of the things that you will hear 0:10:45.240 --> 0:10:48.640 from wealth managers at the moment is that people refuse 0:10:48.720 --> 0:10:50.559 to take capital gains because they don't want to pay 0:10:50.559 --> 0:10:53.560 capital gains tax. So we have much lower turnover and 0:10:53.600 --> 0:10:55.840 possibly in the UK equity markets and other parts of 0:10:55.880 --> 0:10:58.000 the market than we would otherwise because people are very 0:10:58.040 --> 0:11:00.440 key not to take their capital gains tax. Of course, 0:11:00.480 --> 0:11:04.400 because because you pay both capital gains tax and inheritance tax, 0:11:04.800 --> 0:11:06.840 people are loath to pay capital gains tax when they 0:11:06.840 --> 0:11:08.800 know they're then going to have to pay inheritance tax. 0:11:08.920 --> 0:11:12.920 But of course capital gains are wiped out on death, 0:11:13.280 --> 0:11:15.679 so you only pay inheritance tax, so people will only 0:11:15.679 --> 0:11:17.360 want to pay one of those, not two of those. 0:11:17.800 --> 0:11:20.439 So if you put the rate of capital gains tax up, 0:11:20.679 --> 0:11:23.559 then that becomes even more of a problem. The behavior 0:11:23.880 --> 0:11:26.680 of stuff that it drives is really out of proportion 0:11:26.800 --> 0:11:28.079 to the to the tax. 0:11:28.320 --> 0:11:30.160 Well and actually on the behavioral stuff. It is a 0:11:30.160 --> 0:11:34.360 reminder that the hmrc's own estimates of harmonizing the CGT 0:11:34.480 --> 0:11:36.280 with the income tax rates are for there to be 0:11:36.400 --> 0:11:39.440 and you end up losing tax revenue because of this 0:11:39.559 --> 0:11:41.960 exact thing, because everybody just assumes we're gonna we're going 0:11:42.040 --> 0:11:43.800 to wait it out, We're not going to cash in anything, 0:11:43.800 --> 0:11:46.000 so there's no tax to be paid. And then you know, 0:11:46.040 --> 0:11:49.080 they hope for a Tory or reform government next time 0:11:49.120 --> 0:11:51.679 around who will just completely reverse the policy, which you 0:11:51.720 --> 0:11:55.439 know they will inevitably run on. And I mean they're 0:11:55.440 --> 0:11:57.440 also you know, they're saying now that they wouldn't wouldn't 0:11:57.480 --> 0:12:00.920 enforce such a right. So yeah, I mean, it doesn't, 0:12:00.960 --> 0:12:03.160 it doesn't work. And we saw some behavioral action by 0:12:03.480 --> 0:12:06.560 business owners and others a couple of years ago after 0:12:06.640 --> 0:12:08.600 it was anticipated that the capital gains tax would rise 0:12:08.640 --> 0:12:11.920 to everybody basically cashed in before the budget. So we've 0:12:11.960 --> 0:12:14.960 seen a massive spike in actual capital gains tax revenues 0:12:15.000 --> 0:12:17.319 and it's all been driven by behavioral stuff. So again, 0:12:17.360 --> 0:12:20.120 wealth tax is such a difficult one to actually guarantee 0:12:20.120 --> 0:12:22.080 you're going to get any income off because it is 0:12:22.120 --> 0:12:25.680 subject to so much behavioral change more constraints there. 0:12:41.000 --> 0:12:43.439 What is interesting here is the limited period. I mean, 0:12:43.480 --> 0:12:45.640 I know there's talk about how there's a possibility that 0:12:45.679 --> 0:12:47.920 Andy Burnham might call an election and we might have 0:12:47.960 --> 0:12:50.439 another general election. I'm not convinced on that one. I 0:12:50.440 --> 0:12:52.480 don't know how you feel about it. But barring that, 0:12:52.520 --> 0:12:54.480 we're only talking about a couple of years left in 0:12:54.480 --> 0:12:57.640 this term. And so the other conversation that is happening 0:12:57.720 --> 0:13:00.280 around Andy Burnham, and the thing that he's mentioned several 0:13:00.280 --> 0:13:02.600 times is the idea of introducing some kind of of 0:13:02.880 --> 0:13:06.079 land value tax. But of course this is an incredibly 0:13:06.160 --> 0:13:08.240 complicated thing to do, where you have to come up 0:13:08.240 --> 0:13:10.640 with a value for every single bit of land, because 0:13:10.640 --> 0:13:12.559 this is not a property tax. It's not about the 0:13:12.600 --> 0:13:16.480 value of houses. It's about the value of the land itself. 0:13:16.960 --> 0:13:19.000 And the idea of a land value tax is to 0:13:19.360 --> 0:13:22.360 is to charge you very much higher amounts for land 0:13:22.400 --> 0:13:25.840 in areas surrounded by state provided amenities, etc. To force 0:13:25.880 --> 0:13:28.240 you to make that land productive, so to prevent people 0:13:28.240 --> 0:13:30.600 from simply sitting or bits of land and not using 0:13:30.600 --> 0:13:33.680 them properly. But to introduce a tax like that, I 0:13:33.679 --> 0:13:36.360 mean that takes years. So I'm hearing lots of people 0:13:36.360 --> 0:13:38.200 worrying about a land value tax of what is going 0:13:38.240 --> 0:13:39.520 to be awful and how all this work and blah 0:13:39.559 --> 0:13:41.760 blah blah. But I suppose the answer in the end 0:13:41.800 --> 0:13:43.839 is that we've got a very short time period here 0:13:43.840 --> 0:13:46.480 and it probably wouldn't work. Don't need to worry about 0:13:46.480 --> 0:13:47.040 that kind of thing. 0:13:47.280 --> 0:13:50.559 Well, as you say, the complications involved, you just thought 0:13:50.559 --> 0:13:53.440 it would be an obstacle in themselves to this. If 0:13:53.480 --> 0:13:55.319 he needs to win the next election, he needs to 0:13:55.360 --> 0:13:56.520 have done something by then. 0:13:56.880 --> 0:13:57.080 You know. 0:13:57.160 --> 0:13:59.240 One of the other things people talking about is, you know, 0:13:59.320 --> 0:14:02.560 revaluing the council tax ban, so revaluing the entire housing 0:14:02.600 --> 0:14:04.720 stock in the UK so that the nineteen ninety three 0:14:05.000 --> 0:14:09.400 valuation estimates are updated for today. But that itself takes 0:14:09.440 --> 0:14:11.520 a long time, which probably which doesn't sound anything like 0:14:11.559 --> 0:14:13.880 as complicated as doing this kind of what is the 0:14:13.880 --> 0:14:17.320 amenity value of the local services that are provided by 0:14:17.320 --> 0:14:19.760 the state for the land, and then we'll tax a 0:14:19.760 --> 0:14:22.880 little bit of that. But if the council tax revaluation 0:14:22.960 --> 0:14:24.880 is going to know, would take a few years to 0:14:25.200 --> 0:14:27.320 do that. I mean that seems implausible that he'll be 0:14:27.360 --> 0:14:28.960 able to put in a land value tax and actually 0:14:28.960 --> 0:14:30.640 get anything out of it in time for an election. 0:14:31.560 --> 0:14:33.480 Yeah, So what do you think he does have scope 0:14:33.520 --> 0:14:35.520 to do if we're looking at you know, not as 0:14:35.560 --> 0:14:37.960 longer than two years here, and he needs to win 0:14:38.000 --> 0:14:41.120 the next election, and you know, let's say, let's say 0:14:41.120 --> 0:14:43.160 I'm putting this out here, that he actually manages to 0:14:43.360 --> 0:14:46.480 hang on for the full full period and we don't 0:14:46.480 --> 0:14:48.880 have another prime minister in six months or nine months 0:14:48.960 --> 0:14:50.760 or a year. So let's say it gets the whole lot. 0:14:51.800 --> 0:14:55.600 What could he conceivably do within the constraints of the 0:14:55.640 --> 0:14:59.640 fiscal rules that would actually be a effective and be 0:15:00.040 --> 0:15:02.880 reasonably popular. Yeah, I mean I'm coming up with nothing. 0:15:03.000 --> 0:15:06.760 By the way, I'm not sure what would necessarily be popular. 0:15:06.960 --> 0:15:09.000 They're going to have to touch spending in some way 0:15:09.320 --> 0:15:12.480 because you know, we have the tax burdeners is already 0:15:12.880 --> 0:15:16.080 going to be hitting you know, the highest since in 0:15:16.120 --> 0:15:20.240 the post war period. Debt is edging higher. It's getting 0:15:20.320 --> 0:15:22.480 up to very close one hundred percent of GDP. It's 0:15:22.680 --> 0:15:25.000 the deficit has been running at you know, five percent, 0:15:25.280 --> 0:15:27.560 between four and five percent for the last four or 0:15:27.560 --> 0:15:31.160 five years. I mean, it's completely and utterly unsustainable too. 0:15:31.200 --> 0:15:34.200 Then the idea that you can find a tax that 0:15:34.360 --> 0:15:36.800 is going to be an acceptable tax. I mean, I 0:15:36.840 --> 0:15:41.720 can imagine him increasing inheritance tax, for example, because unpopular 0:15:41.800 --> 0:15:45.080 as it is, it doesn't touch you immediately. It is 0:15:45.160 --> 0:15:48.120 something for the future. But the spending stuff, there's talk 0:15:48.120 --> 0:15:51.760 about the triple lock to try and restrain pension of 0:15:51.800 --> 0:15:54.680 spending again would be hugely unpopular because we saw that 0:15:54.680 --> 0:15:57.120 with the winter fuel a lance. Then you've obviously got 0:15:57.160 --> 0:16:00.640 the health benefits which have reached in reaching about one 0:16:00.640 --> 0:16:02.920 hundred sixty billion a year at the moment, going up 0:16:02.920 --> 0:16:04.520 to one hundred and ninety by the end of the parliament. 0:16:04.600 --> 0:16:06.400 I mean Jim O'Neil who's one of the advisors to 0:16:06.400 --> 0:16:08.080 Burnham at the moment, he was even saying, you know, 0:16:08.080 --> 0:16:10.200 you've got to touch these shibbles. You've got to say, 0:16:10.440 --> 0:16:13.040 you know, NHS spending. There has to be some constraint 0:16:13.120 --> 0:16:17.239 on NHS spending. And Burnham is the former Health Secretary 0:16:17.240 --> 0:16:20.040 who has said he you know, he dinede a ditch 0:16:20.120 --> 0:16:22.800 just to prevent prescription charges, et cetera. But there's people 0:16:22.840 --> 0:16:27.600 within the NHS talk about rationing some services because it's unaffordable. 0:16:27.600 --> 0:16:30.800 We've got this bow mool cost disease, which is developments 0:16:30.800 --> 0:16:34.640 in technology end up not leading to productivity gains but 0:16:34.760 --> 0:16:37.920 end up just being new technological costs to the service. 0:16:37.960 --> 0:16:40.600 So it's just, you know, you have this mushrooming NHS state. 0:16:40.960 --> 0:16:43.120 The one thing that I was thinking that he can 0:16:43.200 --> 0:16:45.080 do is just to race tax. If he's going to 0:16:45.120 --> 0:16:46.880 race tax, he's just got a race tax on everyone. 0:16:47.120 --> 0:16:50.720 And then that would require him to say special measures everybody, 0:16:51.000 --> 0:16:53.840 everyone who is paying tax is going to have to 0:16:53.880 --> 0:16:56.720 pay an extra two percent on the on the basic rate, 0:16:56.920 --> 0:17:00.400 and make it, you know, a national project where you know, 0:17:00.680 --> 0:17:03.560 you're not going to be singling out sections of society 0:17:03.560 --> 0:17:06.119 and saying, you know, we're picking on you because we 0:17:06.160 --> 0:17:08.920 need to fix the you know, fix this country. We're 0:17:08.920 --> 0:17:11.240 going to pick on everyone because this is a national 0:17:11.400 --> 0:17:12.760 this is a national requirement. 0:17:13.119 --> 0:17:15.360 And at some point that has to stop, as you said, 0:17:15.680 --> 0:17:17.880 at some point it has to come back to spending. 0:17:17.960 --> 0:17:20.800 Spending has to be reduced. At some point someone has 0:17:20.800 --> 0:17:23.520 to tackle well for spending. Someone has to tackle the NHL. 0:17:23.680 --> 0:17:26.199 Someone has to look at this properly. You can't just 0:17:26.320 --> 0:17:29.360 keep saying taxes up, taxes up, taxes up. And if 0:17:29.359 --> 0:17:31.720 he puts up taxes across the board, and there is 0:17:31.760 --> 0:17:34.120 this brilly interesting conversation going on in the UK about 0:17:34.119 --> 0:17:36.360 who is over taxed and who is under taxed, and 0:17:36.560 --> 0:17:38.720 it you know, we don't have a very good system 0:17:38.760 --> 0:17:42.359 of taxing everybody. The burden is very very very heavy 0:17:42.720 --> 0:17:45.240 on the well off and not particularly heavy by international 0:17:45.320 --> 0:17:48.240 standards on everybody else. But then you come back to 0:17:48.320 --> 0:17:49.800 the fact that an awful lot of the things that 0:17:49.840 --> 0:17:52.240 people are expected to pay for themselves in the UK 0:17:52.320 --> 0:17:55.280 and finance out of general taxation in other countries, and 0:17:55.400 --> 0:17:58.520 in particular ort to enrollment, there's you know, paying paying 0:17:58.520 --> 0:18:00.159 into your pension in the way that we do in 0:18:00.160 --> 0:18:03.119 the UK. That's not necessarily the case in Europe. And 0:18:03.160 --> 0:18:05.960 the same with university education, which we pay for here 0:18:06.040 --> 0:18:08.320 at our own pockets, and people don't necessarily not enough, 0:18:08.359 --> 0:18:10.200 by the way, but we pay for our own pockets, 0:18:10.480 --> 0:18:13.160 which people in Europe do not. And then this dentistry 0:18:13.160 --> 0:18:15.359 and you know, various other things that come out of 0:18:15.400 --> 0:18:18.119 general taxation out elsewhere but not in the UK. So 0:18:18.160 --> 0:18:20.720 if you look at it in the round, very hard 0:18:20.720 --> 0:18:25.280 to say that any part of the UK population is undertaxed, 0:18:25.800 --> 0:18:28.600 maybe over benefited, but not necessarily undertaxed. 0:18:29.000 --> 0:18:31.639 Yeah, exactly. They're almost hidden taxes, aren't they. And then 0:18:31.680 --> 0:18:34.480 of course you've got these levees on the for businesses, 0:18:34.560 --> 0:18:38.440 on energy levees, climate change levees and stuff, and even 0:18:38.480 --> 0:18:40.560 on the house even on household bills. You've got them 0:18:40.560 --> 0:18:43.320 so that some of them anyway are addition are effectively 0:18:43.320 --> 0:18:44.520 additional hidden taxes. 0:18:44.600 --> 0:18:46.000 So I mean, I think one of the things that 0:18:46.040 --> 0:18:48.159 you could say, Andy of you on this is you 0:18:48.160 --> 0:18:51.040 you could could have a go at net zero and 0:18:51.240 --> 0:18:54.480 you know, the interesting thing is that if Millivan becomes Chancellor, 0:18:54.800 --> 0:18:57.880 then we double down on net zero in a well, 0:18:57.880 --> 0:18:59.680 we probably do, and that is one of the things 0:18:59.680 --> 0:19:02.879 that's adding or our rush to net zero is adding 0:19:02.920 --> 0:19:05.960 hugely to our energy built because the infrastructure required and 0:19:06.000 --> 0:19:09.680 the various levees et cetera. Calming down on that slightly 0:19:10.280 --> 0:19:13.000 might be one thing that could bring down built across 0:19:13.040 --> 0:19:13.399 the board. 0:19:14.320 --> 0:19:17.080 Yeah, that is that's an easy, easy one. What the 0:19:17.119 --> 0:19:19.400 tour is just one in Aberdeen? Didn't they the South 0:19:19.480 --> 0:19:23.040 because on this campaign to get drilling in the North 0:19:23.080 --> 0:19:26.160 Sea again? And I mean, yeah, I mean this one, 0:19:26.200 --> 0:19:28.040 I just don't understand it because obviously you can you 0:19:28.040 --> 0:19:30.240 can raise a bit of tax revenue. And also instead 0:19:30.240 --> 0:19:34.040 of having to you know, pump little ship you container 0:19:34.040 --> 0:19:35.800 loads of oil to the UK or whatever you you'll 0:19:35.920 --> 0:19:37.880 you'll be going to get more domestically. So I don't 0:19:38.160 --> 0:19:40.879