Latest news with #publicservices
Times
6 hours ago
- Business
- Times
Government and opposition alike must do much better
Out of the three parties that matter most, only one will be looking forward to autumn. When parliament packed up for the summer recess this time last year, the new Labour administration had a stonking majority, a sense of confidence and a clear plan of action. Twelve months on, morale has collapsed. Rarely have a government's fortunes declined so far, so fast. This is not the consequence of world events or the vagaries of the global economy: Sir Keir Starmer is to blame. He came into power with the stated aim of boosting the economy's performance to improve public services. But prioritising growth demanded a degree of discipline that he has signally failed to demonstrate. Although the government has chalked up a few achievements — for instance, in reforming the planning system — too often other considerations have taken precedence over growth. Workers' rights have been strengthened to the detriment of companies. Taxes on employers have been raised with the consequence that firms are hiring fewer people. Higher pay for public servants has contributed to the deterioration of public finances. The government's big effort to rein in spending centred on its planned reform of the welfare system, but Labour backbenchers rebelled against it. Instead of facing up to the rebels by making the issue a vote of confidence, the prime minister backed down. Predictably, this cave-in has encouraged further dissent. The prime minister's problem is that he is a conciliator rather than a leader. That is why he has proved to be an effective diplomat in his dealings with foreign leaders. With his low-key style, he has succeeded in improving Britain's relationship with Europe, in encouraging European leaders to co-operate over defence and in establishing a good working relationship with Donald Trump, despite the two men's glaring ideological differences. These external successes cannot compensate for Sir Keir's domestic failures, however. They have cost him credibility and the economy momentum. In the past two months, national output has shrunk while public debt continues to mount. In June, the government borrowed £20.7 billion. That is £6.6 billion more than in June last year and £3.6 billion more than expected. As Sir Keir has lost focus on the economy, concentrating on averting short-term difficulties rather than pursuing a coherent agenda, he has come to look like a tactical politician rather than a strategic one. Both MPs and voters are increasingly unclear about what his government is for. Labour is divided between pragmatists who want order in the public finances and leftwingers who want to spend more. The autumn budget, in which Rachel Reeves will have to reconcile the conflicting demands of the bond markets and Labour MPs' desire to protect social spending, will be a pivotal moment in the government's life. Sir Keir's greatest boon has been the state of the Conservative Party. Despite a welcome recent attempt to reassert the party's commitment to fiscal rectitude in the wake of the government's welfare debacle, Kemi Badenoch has failed to establish a clear identity around which her party can coalesce. At 23.7 per cent, its share of the vote in the last election was the lowest yet; it has declined further in polling since then, to 17 per cent. This week's reshuffle will not by itself reverse the Tories' decline: changes in personnel cannot compensate for the lack of a compelling story. The one party that has succeeded in devising one in the past year is Reform. Nigel Farage has capitalised on the loss of direction in both main parties to seize a commanding lead in the polls. Sir Keir and Ms Badenoch need to develop better ways of countering Mr Farage over the summer, or he will make short work of them in the coming year. For both, it is a case of 'must do better'.
Irish Times
12 hours ago
- Business
- Irish Times
Budget plan for €9.4bn public spending boost will be reconsidered if tariffs hit
Plans to spend an extra €9.4 billion on public services , tax cuts and building projects next year will be reconsidered if the US imposes tariffs on EU imports, Minister for Finance Paschal Donohoe and Minister for Public Expenditure Jack Chambers said on Tuesday. But they, along with Taoiseach Micheál Martin and Tánaiste Simon Harris , pledged that if there is pressure on spending plans, they would protect infrastructure budgets and cut growth in current spending on public services, welfare and tax cuts to realise the necessary savings. The Coalition leaders launched a review of the National Development Plan (NDP), promising to spend €100 billion between now and 2030 – a €30 billion increase over what was planned – to improve water, energy, transport and housing infrastructure. [ National Development Plan shows the Government is about to bet big on capital expenditure Opens in new window ] The ambitious plans were overshadowed by the threat of a trade war between the European Union and United States, which Mr Donohoe and Mr Chambers admitted could compel them to revise plans published on Tuesday for a budget day package of €9.4 billion in October. READ MORE In the event of high tariffs, the Government would 'recalibrate its fiscal strategy' and reduce the budget package to keep public finances stable, said Mr Donohoe. Already, the plans for October's Budget 2026 envisage growth in public spending being trimmed from 8-9 per cent of recent years to 6.4 per cent next year. Mr Donohoe said there would be a package of tax cuts of some €1.5 billion. But he added that the cost of cutting VAT on hospitality – a Fine Gael election promise included in the programme for government – would amount to nearly €1 billion in a full year, meaning the scope for any tax adjustments to rates and bands would be reduced significantly. Tariffs: Why has Donald Trump threatened the EU again? Listen | 47:35 'It would not be right to grow the scale of our tax package,' said Mr Donohoe. The Coalition published the amended NDP and summer economic statement at Government Buildings on Tuesday. The NDP promises expenditure of €25 billion on capital projects in 2026, with the amount increasing every year and peaking at €28 billion in 2029. The total is set to reach more than €100 billion by 2030. The plan was immediately criticised for not identifying individual projects, though the Government did point to a small number of 'megaprojects', including the Dublin Metro and two big water schemes: the Shannon to Dublin water supply project and Greater Dublin Area drainage initiative. Social Democrats spokesman on public expenditure Cian O'Callaghan said the plan is 'so vague it doesn't even rise to the level of wish list'. Sinn Féin 's health spokesman David Cullinane said the allocation for health falls 'far short of what is needed' over the next five years. Labour 's Marie Sherlock, meanwhile, has said the €2 billion allocated for the MetroLink is 'hardly a vote of confidence that the project will be substantively progressed in this decade'. The summer economic statement, normally a key document in the preparation of the October budget, was considerably shorter and less detailed than usual. It contained several warnings, however, about threats to the State's public finances from several sources. [ NDP shows Government about to bet big on capital expenditure Opens in new window ] 'Even before the full impact of tariffs takes hold, it is increasingly evident that heightened levels of uncertainty have prompted firms to delay investment plans and households to step up precautionary savings. These headwinds are set to slow the pace of economic expansion,' it said. The document also warned that the 'headline surplus is now likely to be considerably lower than set out in the spring'. It flagged that spending pressures in several Government departments will require additional funding above their agreed allocations, prompting Mr Chambers to warn of the need for spending discipline and an end to bailouts in the second half of the year – a now familiar necessity in some departments.
Yahoo
a day ago
- Business
- Yahoo
Government borrowing soars to second highest level on record
Government borrowing rose significantly more than expected last month as debt interest payments soared. Official figures show the cost of public services and interest payments on government debt are rising faster than the increases in income tax and national insurance contributions. It means government borrowing reached the second-highest level last month since records began in 1993, according to the data from the Office for National Statistics. June's borrowing figures - £20.684bn - were second only to the highs seen in the early days of the COVID-19 pandemic in 2020, when many workers were furloughed. State borrowing was more than £6bn higher than the same month last year. But despite this latest rise, borrowing this year is in line with the March forecast from the independent forecasters at the Office for Budget Responsibility (OBR). It's bad news for Chancellor Rachel Reeves, who has vowed to bring down government debt and balance the budget by 2030 as part of her self-imposed fiscal rules. She's expected to increase taxes to meet the gap between spending and tax revenue. Ms Reeves's deputy, the chief secretary to the Treasury, Darren Jones, said, "We are committed to tough fiscal rules, so we do not borrow for day-to-day spending and get debt down as a share of our economy." "This commitment to economic stability means we can get on with investing in Britain's renewal". This breaking news story is being updated and more details will be published shortly. Please refresh the page for the fullest version. You can receive breaking news alerts on a smartphone or tablet via the Sky News app. You can also follow us on WhatsApp and subscribe to our YouTube channel to keep up with the latest news.
South China Morning Post
a day ago
- Business
- South China Morning Post
Malaysia mulls making digital ID mandatory as security fears hinder adoption
Fewer than one in every 10 eligible Malaysians has signed up for a digital identity card in a flat rejection of a year-old plan to streamline access to public services – prompting the government to raise the prospect of making it mandatory despite data security fears. Launched in May last year, the MyDigital ID was billed as a single login across state agencies that would consolidate the data of citizens aged 18 and over on government systems. But despite a high-profile launch by Prime Minister Anwar Ibrahim in December 2023, public enthusiasm has been lukewarm, hampered by memories of a botched roll-out last year that left many unable to register due to persistent server failures. With only 2.8 million out of Malaysia's 34 million eligible people on board the system, Federal Territories Minister Zaliha Mustafa told parliament that the voluntary nature of the programme remained a key barrier to adoption. 'The government is looking into the possibility of enacting laws to encourage or maybe require people to register for MyDigital ID,' Zaliha said on Monday. Speaking on behalf of the prime minister, she added that the system now supported 82 applications, including motor vehicle registration, licensing and healthcare services.
Yahoo
a day ago
- Business
- Yahoo
OpenAI and UK sign deal to use AI in public services
OpenAI, the firm behind ChatGPT, has signed a deal to use artificial intelligence to increase productivity in the UK's public services, the government has announced. The agreement signed by the firm and the science department could give OpenAI access to government data and see its software used in education, defence, security, and the justice system. Technology Secretary Peter Kyle said that "AI will be fundamental in driving change" in the UK and "driving economic growth". The Labour government's eager adoption of AI has previously been criticised by campaigners, such as musicians' who oppose its unlicensed use of their music. The text of the memorandum of understanding says the UK and OpenAI will "improve understanding of capabilities and security risks, and to mitigate those risks". It also says that the UK and OpenAI may develop an "information sharing programme", adding that they will "develop safeguards that protect the public and uphold democratic values". OpenAI chief executive Sam Altman said the plan would "deliver prosperity for all". "AI is a core technology for nation building that will transform economies and deliver growth," he added. The deal comes as the UK government looks for ways to improve the UK's stagnant economy, which is forecast to have grown at 0.1% to 0.2% for the April to June period. The UK government has also made clear it is open to US AI investment, having struck similar deals with OpenAI's rivals Google and Anthropic earlier this year. It said its OpenAI deal "could mean that world-changing AI tech is developed in the UK, driving discoveries that will deliver growth". Generative AI software like OpenAI's ChatGPT can produce text, images, videos, and music from prompts by users. The technology does this based on data from books, photos, film footage, and songs, raising questions about potential copyright infringement or whether data has been used with permission. The technology has also come under fire for giving false information or bad advice based on prompts. WeTransfer says files not used to train AI after backlash Man files complaint after ChatGPT said he killed his children Peers demand more protection from AI for creatives What is AI and how does it work?
