What Worth is the Annual Budget

 

It’s always interesting to reflect on discussions leading up to the annual budget. The same themes are restated with monotonous regularity with promises to reduce the national debt, improve productivity and boost funding for key policy areas such as the national health, education, redeveloping the manufacturing base and creating a world class economy. Sadly as in previous years little happens after the announcements: it’s a classic example of empty political rhetoric and tokenism.

This year’s’ budget is no different; before the announcements a great deal of media coverage raised the crucial and central problems of productivity in the manufacturing and services industries. Facts and figures abounded in the press and mass media as in previous years. German and France are respectively 36% and 30% more productive than this country. The growth rate in the country continues to be the lowest in Europe and one of the lowest in the developed nations. Politicians stressed the urgent need to address this fact and other employment issues e.g. the situation with wages growth.

A recent report has indicated that the current stagnation in wage increases will persist 2025 and then only to the level in 2008! Productivity has been a problem for many years and shows no sign of improving and it will get worse following Brexit. Practically all aspects of the economy are flat lining. One major theme in this year’s budget was the urgent need to build 300,000+ houses but how can that happen with the massive skill shortage of key tradespeople e.g. plumbers, joiners, brick layers etc.! Also it takes at least one generation to increase numbers of teachers and change attitudes of young people to enrol into technical subjects and enter technical professions. These facts reflect that successive governments focus on single issues to gain public favour when they should adopt a holistic approach recognising all the interconnected elements.

The central problem is the national debt is massive – the country is bankrupt with the true level not being openly declared. When you include all the elements of the debt including personal, pensions and corporate the figure is truly astronomical and will never be cleared whatever the politicians and some economists say or through austerity policies. The exit from the EU will further worsen the situation it will be a true dogs Brexit in all senses!

The problems as previously stated in earlier articles are long standing and fundamental. Solutions to tackle once and for all these issues require radical, long term policies supported by all political parties. Short termism is one of the key problems with this country in political and financial organisations.

Countries that have adopted long term policies are far more successful with international trade and possess effective technical education and training systems and as a result do not possess skill shortages and gaps.

Here, investment in key areas such as technical education and training must be operated for the long term and without government interference. Even when Further Education (FE) was adequately funded it was only on a short term basis and often linked to limited initiatives and schemes e.g. the Manpower Services Commission, programmes like TVEI, GNVQs et.al. The majority of these initiatives were very politically driven and sadly technical education was seen as being second class, including in terms of their contribution to economic success, when compared with schools and universities.

Important elements that need to be addressed: (It’s all been said before).

(1) Radical and long term policies must be introduced and supported by all political parties.

(2) Politicians need to recognise all the problems confronting this country once and for all and be more open and honest with the general public.

(3) Politicians also need to recognise that it takes a generation to rectify the problems. This is especially true for education and training

(4) The central role of technical education and training and the FE sector must be fully recognised in solving the present problems with skills and productivity in the work place.

(5) Employers, professional bodies and trade unions must be involved more in shaping technical education and training policy.

(6) Work law and existing practices must be reviewed and reformed in order to recognise the rapidly changing nature of work e.g. automation, robotics Artificial intelligence et al.

(7) Funding to tackle the very poor productivity in employment areas especially in manufacturing industries.

(8) Adequate funding for practical subjects in schools must be provided and the current cuts stopped and the importance of practical vocational subjects fully recognised.

(9) Partnerships between all the education and training sectors must be increased.

(10) Careers advice and information must be improved providing positive message about technical and practical subjects and their associated careers.

(11) The multitude of negative consequences of Brexit, if it happens, must be recognised and contingency plans made otherwise the situation will get even worse

This year’s budget again failed to consider many of the above issues and it when it addressed issues like the proposed industrial strategy and productivity did so in a superficial manner and short time fashion. The budget must form a crucial element of any plan to reform the fundamental problems that confront this country.

 

 

 

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