Upon leaving the National Park I gave Katia, from Finland, a lift to the next town to keep her from hitch-hiking into the clutches of evil motorists. She is on a similar period of time out to me, and works in the Finnish banking sector. She was interested to hear if I had kept abreast of the state of the Euro, and the UK's 'choice' to opt-out of discussions. Finland, it seems, hasn't fared too badly in the current crisis and sought insurance from Greece (in the form of islands, according to Katia) over its' loans. Her suggestion was Greece sell off some of its' historic sites to private buyers. She was oblivious that the very same had been a genuine headline not 24 hours previous.
Our conversation prompted me to run my eye over financial affairs back in the UK. Whilst in the States, and seeing a large number of Occupy occupations first-hand (indeed, the Boston and DC protests were 'moved on' while I was in those actual cities...coincidence), I read around what the movement was about quite a lot. As far as I am concerned Occupy feels a little disparate - too many minor gripes being collated under the one banner such that little meaningful traction will result. To my mind, if Occupy is to succeed, it needs to focus its' aims, and more needs to be made of how Iceland coped with the financial crisis (remember where it all started?). The West is governed by politics whether you like it or not. Iceland has shown politics and, perhaps more importantly, 'politicians' can work for the greater good.
In UK politics, two stories piqued my interest this week: the welfare cap and executive pay.
The UK government has seen the opportunity to save £51m from the benefits budget over the three years to 2015, by placing a cap on the maximum amount a household can claim annually in benefits. It is a move supported by opposition politicians. However, the Lords has rejected the bill on the grounds that it includes child benefit, and will affect 220,000 children regardless of situation. 67,000 households will be worse off as a result of the measures, only 40,000 without the inclusion of child benefits. The Government is determined that the bill goes through in full, and looks to be digging its' heals in on the issue.
In the same Commons session, the government announced its plans regarding executive pay.
There is no doubting this is a contentious issue. The banking sector has, justifiably, come under immense scrutiny for its' outlandish rewards in the aftermath of global financial meltdown. Even this week, the chief exec of RBS stands to receive a bonus of £1.3m. £1.3m of taxpayers money. And that's on top of a salary of over £1m. Here, then, it seems, was an opportunity for the government to make a real statement. More than happy to point out the shortcomings of the previous government (chief exec pay was 40 times that of their employees when Labour came to power in 1997, rising to 120 times by 2007), might they even seek to cap salaries to a maximum, mirroring the minimum wage?
The answer is, sadly, no. All they could come up with was the need for "more transparency" and adoption of "best practice". In layman's terms, what they have done is nothing. Apart from guarantee the pockets of the wealthiest remain cosily lined for the foreseeable future whilst the disparity between the wealthiest and middle classes widens (certain chief execs now earn 1000 times the national median wage - British Gas, Barclays), not to mention those larger families living on the benefits breadline who will see their income slashed from 2013. In 1979, the top 0.1% of earners took home 1.3% of the national income. By 2007 this had risen to 6.5%. Certain individuals will tell you this increase is justified because the execs at the top are the 'risk-takers', the ones whose decisions ultimately determine the fate of a company. The truth is that an exec is 13 times less likely to be sacked than the lowest paid worker. Thirteen times. Hardly seems the position of a risk-taker to me.
"Best practice" is a term I am acutely familiar with, because it has defined my professional life for the past few years. The sad thing is, in reality "best practice" is virtually impossible to achieve. People will say they aspire to follow "best practice" processes but, when push really comes to shove, the comfort of existing procedures, the cosiness of familiarity, will result in little or no change. It takes a very strong personality at the head of an organisation, a project, a company, a country, to genuinely implement anything approaching "best practice". The UK government has just shown it is not up to the task.
For best practice to take and hold and work, you need one of two things: a workforce that is completely on song, 100%, with what you are trying to achieve; or, an accepted dictatorial approach from those in charge. It might be just me, my cynical view of the world from which I have taken this break, but I struggle to see a situation where chief execs, en masse, decide to reform the pay structures of their companies without legislation from government.
At time of going to press, the news is that the Liberal Democrats will tomorrow outline their countenance to the 'coalition' budget, calling for quicker reform of income tax to aid middle income families. All these different aspects represent a most delicate balancing act, of that there is no doubt. But balance is impossible when the scales are weighted so favourably in one direction.
Umm, yeah. Will try and talk about the trip in the next installment!
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