How to fix our economy

As I have said in my previous post there are many different countries and economies within the EU, so what I believe is right for the UK isn't necessarily right for other countries, but I believe some principles are the same.

Britain needs to change if it is to get out of this economic malaise, unfortunately we are stuck within the EU straitjacket and it is very difficult for us to do this. Recently UKIP MEP Gerard Batten published a study on the costs of the EU to the UK, his conclusions were as follows:

Indirect costs to the UK economy in 2010

The Common Agricultural Policy £16.7 billion
The Common Fisheries Policy £4.7 billion
EU Over-regulation of business £48.7 billion
Add to this our Net contribution and the total comes to £77 billion.

Regulations like the Working Time Directive, Maternity and Paternity pay increases, the EU carbon emissions regulations and Environmental directives are costing us billions and will continue to cost us billions. Regulation in Farming, and the myriad 'health and safety' regulations that businesses have to implement every year cost jobs and money. Adhering to ridiculous EU regulations on bids for Government contracts costs billions of pounds and jobs. You only have to look at the recent Thameslink rail project; the government bureaucrats followed EU regulations precisely and gave the contract to Siemens of Germany, thus, the last manufacturer of trains in the UK will close costing thousands of jobs and costing the economy billions. What I find even more staggering is that Siemens has just won a multi-billion pound contract to build trains for the German railway, so even if they had missed out on the Thameslink deal no German jobs would have been lost. Yet thousands of British jobs will go, what sense is there in this.

It doesn't take long to see that those running the EU do not understand how business works. So how can Britain create growth? Well firstly we need to cut regulations, that is quite obvious, I have looked at this above and it doesn't take too long to see how this restricts business. Small and medium size businesses make up about 75 per cent of companies in this country, it is very difficult, if not impossible for small companies to grow simply because of the high cost of implementing these ridiculous regulations. Remember we are not just competing with those within the EU but the likes of Brazil, China, India, etc and if we don't free up business they will either die or go elsewhere.

We need to cut income tax and National insurance contribution. I have always been amazed that companies have to pay national insurance when they employ someone, surely we should be encouraging business to take people on rather than penalising them when they employ someone. I was speaking to a friend who runs his own firm, he is a one man band and would love to expand but because of what he would have to pay the government just to employ someone he won't do it, on top of this the cost of insurance and EU regulations it just is not worth it. On top of this we should cut business rates for businesses employing less than five people.

In 1978 the higher rate of income tax in this country was running at 83 per cent, the government raised 47 per cent of its income form income tax. In 1984 Margaret Thatcher reduced the higher rate of income tax to 40 per cent and the government raised 54 per cent of its income from income tax. It has been shown by many examples that if you tax people more they are less likely to pay what the government want, especially the rich. If people have more money in their pockets they are more likely to spend more, thus helping the economy grow.

We should cut the public sector, specifically those doing non jobs, we should also cut public sector pay, especially the people at the top. The government needs to encourage the private sector, this is the area which makes the country money, the public sector creates no wealth, except that which people spend in the shops. Private sector does not cost the tax payer anything and brings money into the economy in three ways; those who work for the company spend their money in shops and other business, the company and employees pay tax and it creates wealth by increasing peoples prosperity, and if it is an export company it sells things abroad thus creating more wealth, so we have a win win situation.

The government needs to invest in education and apprentices, when I say education I mean proper qualifications from proper universities. We need engineers, and those with expertise in new technologies not useless degrees in media studies which brings no benefit to anyone including the person with the degree. Companies need to take on apprentices and the only way they will do this is if it is worth their while doing it, this means the government need to give tax breaks and reduce regulation.

The government has to do something about our benefits culture and this means cutting benefits to the long term unemployed. Gordon Brown tried to cut poverty, and the way he went about this was by handing out billions in benefits, this then created an underclass who found they were better off if they did not work, so didn't. Handing money to the poor has been shown to not work and just keeps people in poverty, this cycle needs to be broken. If it isn't we will never see any change. I believe the only way some people will work is if they do not eat, I also believe we have to make it worth their while to work, and that is by reducing income tax. If for instance you earn less than £15,000 a year you pay no tax, this I believe will work because you will take hundreds of thousands off benefits and they will then start spending the money they earn.

Lastly, cut immigration, I have covered this before, so I am not going to go into too much detail, suffice to say there are currently 2.5 million people in this country on unemployment benefits. Why do we need to import many thousands of foreign workers when we do not have enough work for ourselves?

I have not been able to go into much detail, but hopefully you get the general idea about what I am saying. I do find it very frustrating when I listen to so many of our politicians talking about jobs and our economy, but not actually doing anything to create jobs and bring growth. I think the reason for this is because so many of our political class do not have a clue, and do not understand. If you have anytime and can be bothered just spend some time researching the background of our leading politicians and you will quickly find that the majority of them have done nothing else except work within politics or a political organisation. Most will never have run a company so will not know what the reality is like for most ordinary people. All I can say is 'God help us all!'