Leaders: Whiff of desperation is the pervasive aroma
After David Cameron’s invitation at the Davos World Economic Forum to companies to “wake up and smell the coffee” of public anger against those businesses which are aggressively avoiding paying tax, business leaders have rightly retorted that what the prime minister might end up smelling is stagnation.
Mr Cameron’s coffee soundbite was a clear reference to Starbucks and the row that followed the revelation last year that it had paid just £8.6 million on profits running into the hundreds of millions in the 14 years it had been operating in Britain. During the week, Starbucks reported that its global revenues in the last quarter of 2012 were 11 per cent higher than in the same period in the previous year at $3.8 billion while European net revenues were up 1 per cent.
Mr Cameron’s speech was a pretty clear attempt to shout from the Swiss mountaintops that he is on the side of the ordinary and struggling British voter and that he is going to take some pretty tough action against tax-avoiding companies.
In these stern words, another odour is detectable – the whiff of a slightly desperate politician who is trailing in the opinion polls and whose government’s actions in cutting back welfare benefits while managing an economy which, it turned out less than 24 hours after Mr Cameron spoke, is stagnating, begin to look like the same old Conservative party that voters turned away from in the 1990s.
Few disagree that companies should pay their fair share of taxes, and in fact very few do not pay what they are due. What rightly riles the company directors who have reacted against Mr Cameron’s strictures is that they are all being tarred by a brush with a few conspicuous bristles such as Starbucks.
This risks a reversion to an older disruptive politics which can turn business into a “them” and “us” battleground. But the arena that all need to be in – bosses, workers, and customers – is the struggle to achieve efficient, competitive, and profitable businesses. From that will come the employment and the taxes that will keep public spending sustainably in check and drive down public debt.
The vast majority of companies have tax affairs which meet both statutory and moral obligations. These companies exposed for paying little tax have broken no law. If Mr Cameron thinks they are paying too little tax he should change the laws until he is happy. That will work a lot better than simply telling companies they should freely contribute more.
As the most recent economic figures starkly highlight Britain needs economic growth, and business provides that. It is up to the government to make sure it gets its tax laws right because businesses need hard figures to do their balance sheets. Britain’s’ tax code is way too complex, and that provides loopholes.
Patter merchants’ challenge
Glasgow has a proud record of leadership from the Industrial Revolution to the City of Culture year which is still used as a model of how art can lead revival. Now it has been given a chance to lead again by showing how citizens can improve their lives and the urban economy through making the most of, not just technology, but connected technology.
To prove how this can work, it has been given £24 million. This is not a hand-out, but a prize which the city has won from the UK government’s Technology Strategy Board in a fair and square competition against 30 other British cities.
The key idea behind this is not just to escalate the amount of information that is available about transport, traffic, street crime, health facilities and their use, energy use, and other areas of civic life, but to connect up the streams of information so that different systems can talk to each other and the information can be accessed, not just by experts and managers, but also by the general public.
So Glasgow is to be congratulated on its success so far and it is to be hoped the city maintains its reputation for innovation and grasps this opportunity with enthusiasm and vigour and finds a joined-up way that technology can improve the lot of all citizens and also that of its administrators.
All it needs is a catchy name. The official title – the Future Cities Demonstrator – doesn’t fit the bill and has unfortunate other connotations to do with protesting, which Glaswegians also do very well.
Smart Glasgow? City of the Future? Glasgotechnopolis? Somebody will come up with the right words. Glaswegians are pure dead brilliant at that.
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Thursday 20 June 2013
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