Opinion: Profiting from not selling out – let’s start (up)

The Lib Dems could and should be the party of small business at the next general election and we must not wait another five years to realise it. We cannot allow Labour to clumsily win back liberal minded voters from the Tories as they did in 1997.

Lib Dems in Government create economic prosperity and security, that is an irrefutable fact of the last five years.  Now we need to find enough messengers to carry this story to British enterprise.

I run a financial technology startup and I’ve now lost count of the number of sympathetic texts and emails I’ve had from clients and business peers over the past month: “I liked your man, shame he did so badly”, and a lot of “ I really can’t believe the Lib Dems did so badly, I voted Tory as I didn’t want Labour.”

My opening sentence is a platitude that every political party trots out once every political electoral cycle when it’s worried it doesn’t have enough core vote, or put bluntly, enough money. We can do better, we can actually mean it and commit ourselves through our policies to become the party of the entrepreneur.

In addition to our record of repairing a damaged economy, I think we have three distinct, vital differences that make us attractive to job creators and we need to be shouting about them, as loudly as we can.

Internationalist

We are the only true internationalist, pro-European and pro immigration party.  Bound up in that commitment to free trade, the free movement of people is a promise that every liberal, businessperson wants to hear.

Faced with the most euro-sceptic government in recent memory and a Labour opposition drifting to the hard left, everything in between is our ground.  Its not the middle ground, it’s the only sensible ground that allows people like me to create profitable businesses, create jobs and hire talented staff.

Regional prosperity

Whilst the Tories shore up English votes by appeasing UKIP voters and Labour battles to out ‘left wing’ the SNP in Scotland, we have a national message that’s as relevant now as it was before the election. We’re a federal, democratic party; a national party for the whole country, not a voter base.

How do we prove it? Lets start with digital infrastructure. Have we ever lived in an age where the barriers to starting a business and trading with the world were so low?  Tim Farron began the Lib Dem campaign last year but lets commit to a broadband revolution, investing and subsiding in high-speed digital access right across our country so that starting or working for an online business in Southampton, or Swansea, is as accessible as it is in Shoreditch.

An entrepreneurial civic network

Liberal Democrats are ‘do-ers’, we fill in the gaps when our local councils fail and we have a lot to say to business owners who choose to provide for themselves, rather then rely on the state. We get local roads, parking and rubbish tips fixed and we provide a stable campaigning force, elected or otherwise.  We campaign for our local services through our councillors and our activists and we are, without stretching the metaphor, a series of entrepreneurial networks that thrive in challenging conditions with few resources.

Lets do more than ask liberal minded business people for votes and money, lets help them onto the governing bodies of schools, hospitals and local charities.  People that start businesses want to do things differently rather than just take a monthly salary, lets give them a chance to make a difference in their local community by championing our entrepreneurial approach and putting their skill sets to work in our local communities.

Have I simplified the challenge and the solutions? Yes of course I have.  I need 500,000 words, not 500, but I believe passionately that as Lib Dems we have an electoral opportunity that we’ve so far ignored.  It’s time to start up.

* Alain Desmier is Chairman of the Islington Lib Dems. You can contact him at [email protected]

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117 Comments

  • Eddie Sammon 1st Jun '15 - 3:52pm

    The dividend tax increase was one of the most anti business policies of the general election. Only the Times seemed to pick up on it. You can’t just tax dividends the same as income because of corporation tax and the policy presented was appeasing the idea that you could.

    Also, the phrase “pro immigration” should be replaced with “pro free movement” – I think it goes down much better.

    I’m reducing my comments on here, but I am interested in engaging with pro business people everywhere. I think the left have managed to give the impression that they are in the majority because they actually speak out, so people who disagree with them, even if it is only on economic issues, need to speak out more.

  • Malcolm Todd 1st Jun '15 - 4:00pm

    Eddie, I’m curious as to why you think we should take corporation tax into account when assessing effective income from dividends but apparently are not concerned with the impact of national insurance (including employer’s national insurance) on the taxation of employment income.

  • Eddie Sammon 1st Jun '15 - 4:21pm

    Malcolm, I always consider employee’s national insurance, but I am not including employer’s national insurance in the employee’s tax liability, which is what some people seem to want to do to justify the current policy.

  • Alex Macfie 1st Jun '15 - 4:25pm

    One important policy especially (but not exclusively) for digital entrepreneurs is a robust net neutrality law, so that infrastructure providers cannot use their position to pick winners in the Internet marketplace. We also need to keep software patents out of the EU (and in general make sure our intellectual property laws benefit genuine innovators, rather than established legacy businesses and “trolls”). EU law is where most of this happens, and our MEPs have usually been on the right side of the debate. Shame we never mentioned it (or anything else about our actual policies for EU law) in the Euro election campaign.

  • Jenny Barnes 1st Jun '15 - 4:26pm

    Alain “Lib Dems in Government create economic prosperity and security, that is an irrefutable fact of the last five years”
    I believe that the first part of that sentence is contestable, and it certainly isn’t irrefutable. There was certainly less prosperity and security for those subject to the bedroom tax, on ZHCs, subject to employment benefit sanctions; and then there’s the macro economic arguments that “austerity” and reduction of state expenditure is precisely the wrong thing to do in a recession. Not that the coalition did as much of that as they claimed; much quantititative easing and money given to banks and of course the various “help to housing bubble” policies that aimed to keep the economy growing.
    I must have missed the Labour leadership candidate promising to nationalise the railways, banks, energy companies, utilities, etc. Oh, what’s that you say? There isn’t one? Hard left – nonsense. They’re tory light. And if the LDs are not to present themselves as Tory light as well, a different economic message is needed., not a slightly different take on neo-liberalism,

  • What kind of things can our councillors and activists do at a local level to both engage with and support small businesses (and I’d also include home and flexible workers, although their needs may be slightly different)?

  • Eddie Sammon 1st Jun '15 - 4:40pm

    Malcolm again, even if we looked at things from your perspective, I would rather we cut employer’s national insurance than increase dividends tax. I am not a tax cutting maniac, but I think small businesses pay too much tax and suffer from too much regulation and despite people saying for years that they are going to reduce this, it hardly seems to happen.

    There was nothing in the Lib Dem manifesto about cutting employer’s national insurance and lots about protecting budgets, with inevitable further tax increases.

  • @Jenny Barnes “They’re tory light. And if the LDs are not to present themselves as Tory light as well, a different economic message is needed., not a slightly different take on neo-liberalism,”

    You’;ve got this the wrong way round, jenny.

    Labour and the Conservatives cherry-pick bits of Liberal policy, but don’t back it up all the way. So, we’re not “Tory-lite”, neither are Labour. Both are “Liberal-Lite” when it comes to economics.

  • A Social Liberal 1st Jun '15 - 4:53pm

    Well said Jennie Barnes

  • Alain Desmier 1st Jun '15 - 6:11pm

    @ Alex Macfie
    Really interesting points, and something I know very little about. You should develop them into a LDV post about some practical steps we can take, I’d love to read more.

  • Alain Desmier

    I am interested in your general starting point. You do however seem to have a very utopian view of small businesses and their owners.

    My knowledge of the subject is not that extensive but I have found that small business owners know a lot about their own business but very little about much else. That is not a criticism it is a statement of fact.

    A lot of politicians from all parties like to “talk up’ small business — but what do their words actually mean?

    I have nothing whatsoever against small businesses. That is not the same as thinking that they will be the engine to solve the problems of poverty, climate change, crime, wars or xenophobia. It is beyond me why anyone should think lots of small enterprises running around is necessarily a ‘good thing’ any more than condemning them for being a ‘bad thing’.

    The governing bodies of schools, hospitals and local charities are just as likely to benefit from the enthusiasm, knowledge and experience of a nurse, train driver or tax collector as they are from someone who owns a business selling widgets to another firm who fits those widgets into something else and sells them on.

  • @Alain seconded. It’s great to see this sort of innovative thinking here taking us away from the sterile debates of yesteryear.

    Small businesses are the very epitome of Liberalism

  • jedibeeftrix 1st Jun '15 - 7:40pm

    “We will have to argue for being at the centre of Europe, probably in the Euro and right at the heart of European collaborative decision making.”

    That would be… courageous, Minister.

  • Eddie Sammon 1st Jun '15 - 7:47pm

    Honestly William, when Lib Dems talk about being in “the centre of Europe” and “probably joining the Euro” it becomes clear the biggest obstacle to Lib Dems being in power is Lib Dems.

    I would be open minded to joining the Euro, but it can’t be put like the above and needs to be off the agenda for the foreseeable future.

    Lib Dems need to discover patriotism. In the hard-ball EU negotiating rooms you will get nowhere without a significant dose of patriotism.

  • Samuel Griffiths 1st Jun '15 - 7:55pm

    Well said Jenny Barnes and William Hobhouse.

  • Little Jackie Paper 1st Jun '15 - 8:07pm

    William Hobhouse – ‘If we want to be unashamedly pro-EU because it is good for business, then we cannot sound like David Cameron (stay in, but the EU needs to change). We will have to argue for being at the centre of Europe, probably in the Euro and right at the heart of European collaborative decision making.’

    Problem here though is that in this context, ‘unashamedly pro-EU because it is good for business,’ sounds rather like corporatism – another wave of cheap labour, another load of in-work benefits and outsourcing to Latvia. I am continually astonished by how many in the LDP don’t seem to see this.

    How many in the LDP right now would think it a good idea to go into the EU referendum campaigning on a platform of joining the Euro and EU expansion that would involve full blown freedom of movement with Albania, Ukraine and Turkey?

    Some people on the pro-EU side of this debate seriously need to wise up before the referendum swings into gear.

  • @Jenny Barnes perhaps if more support had been given to enabling business start ups there would have been fewer people claiming unemployment benefits or requiring ZHCs from large corporations.

    A dynamic entrepreneurial economy is the way to get people out of poverty

  • Philip Rolle 1st Jun '15 - 8:15pm

    If I receive £80 net of basic rate PAYE and am a higher rate payer at 40%, then I pay a further £20 to HMRC.

    If I receive £80 of dividend income net of the tax credit and am a higher rate taxpayer at 40%, then I pay £20 to HMRC.

    In each case, my higher rate liability is 25% of my net spendable income ( ok let’s ignore national insurance )

    In their last manifesto, the Lib Dems seemed to be proposing a “dividends tax” to increase the liability of an individual on dividend income. This, as Eddie Sammon said, was clearly anti business. It increases the cost of people getting money out of their own companies and companies in which they invest.

    The Lib Dems policy on capital gains contemplated an increase in the rate of tax and a simultaneous reduction in the annual exemption.

    Before Lib Dems can talk about being the party of small business, tax policies such as these will have to be jettisoned.

  • Jenny Barnes beat me to it!

    I would prefer to put the maximum possible distance between ourselves and any claims of responsibility for the “economic growth” of the last three years. It looks awfully unsustainable to me with ballooning debt and plummeting productivity. Much of the “growth” was achieved by restarting the now traditional property-based Ponzi scheme so one way or another it’s hard to see a happy ending.

  • Eddie Sammon 1st Jun '15 - 8:41pm

    Brilliant comment Philip Rolle. The idea of increasing taxes on middle income small business owners does have to be “jettisoned”. Thankfully, both Farron and Lamb seem to be committed to doing more for small businesses.

    These should be “core vote Lib Dems”, but they have become “core vote Conservatives”, for whatever reason.

  • Philip Rolle 1st Jun '15 - 8:55pm

    I guess the starting point is whether the CGT rate for entrepreneurs should be set at the current 10% or some other rate.

    As I see it, the main issues with regard to dividends are “should they be re-categorised as earned income in some cases and therefore liable to NICs?” and “should we tolerate income splitting between spouses where, say, the earnings of the limited company are from one person’s endeavours?” Both thorny problems these, which as an accountant I was rather looking forward to reacquainting myself with had a Labour/SNP government been elected.

    The Conservatives may well continue to bury both these issues. They form part of the detail of tax policy, but clearly will be very relevant to the small business and it would be interesting to know how the party will move forward on them.

  • Matthew Huntbach 1st Jun '15 - 9:10pm

    I have read this article, but it just seems to me to be vague platitudes. A bit of it seems to be calling for more government spending on various things, but the Tories would call that “anti-entrepreneurial”, because it would require more taxation, and the Tories would say that’s an attack on people with aspiration. According to the Tories, the main thing that stops people who have good idea and want to start businesses with them is the fear that if they do well, so make a lot of money, so buy a big house, they’ll have to pay more tax on it if rotten anti-business people have their way. Now, I’d say this is nonsense. It’s even more nonsense when they say inheritance tax is an “attack on aspiration”. Just how is letting those lucky to have wealthy parents sit around leading lazy unproductive lives because they know they’ll be getting their big dollop of inheritance cash some day an “attack on aspiration”?

    So what exactly is this “entrepreneurial approach” you are calling for, if it isn’t the Tory one? I find it difficult to see anything much concrete in the article. There’s a call for “business minded” people to get more involved in voluntary activities – but isn’t that a bit daft? I mean, if they are busy running their businesses how are they going to find the tie to be school governors etc, as those are actually very time consuming roles?

    Now, if you want to help budding entrepreneurs, surely the first thing to do is bring back low rent council housing, so they aren’t forced to spend all their money on housing, and so they have some left to invest in business, and so they don’t feel they have to go for safe medium-paid job because of fear that if they go for something risky they won’t be able to pay the mortgage so they’ll lose their home. Then make it less profitable to invest money in housing so that people are more likely to invest it in building up business instead. So, impose a big property tax, and say to anyone who wants to buy a big house “if you have the money to do that, you have the money to invest in funding an entrepreneur, so put a bit of that house-buying money into that investment, and you can use that to pay the mansion tax”.

    Er, but that’s not what the Tories are saying, is it?

  • Jonathan Webber 1st Jun '15 - 9:21pm

    Without going into specifics I agree with the thrust and tenor of this piece, one of the most sensible things I’ve read on LDV for a while. In 2013 a number of authors submitted a paper in which we argued that there existed (and exists) a massive constituency of young entrepreneurs for whom the Liberal Democrats should be a natural home.

    We suggested that this constituency was a broad meritocracy, digital, design-led, creative, outward looking, international in outlook and pro-European. We went on to comment that it was/is by its nature thoroughly diverse and completely national.

    Finally we observed how other political parties used / utilised local civil society patronage to maintain influence and a semblance of control; NHS Trusts, Regional Quango Positions, transport etc.

    It’s worth the discussion again.

  • Matthew Huntbach 1st Jun '15 - 9:30pm

    So, the Tories’ claim to be “entrepreneurial” is like the tired old communist bosses’ claim to be “revolutionary”, just ridiculous propaganda used to defend the ruling class. In reality, the Tories are about the opposite of this, they are about defending the idle rich and making life harder for everyone else to break into their privileged lifestyle. Just as the old communist bosses might have used language urging people to be “revolutionary”, but what they actually meant was for people to be timid supporters of the new ruling class and not revolutionary at all.

    So, what do we and Labour do? Instead of laughing off this nonsense and pointing out its hypocrisy, we go along with it “ooh, er, we aren’t being entrepreneurial enough, so we too must go out and defend the idle rich to show we are”. Oh come on, hasn’t anyone the guts to actually come out and ATTACK the Tories rather than adopt various forms of “we too to what you say, but please Tory bosses, we’d like you just to be a bit kinder sometimes, oh not much not often and sorry for asking really” tug-tug the forelocks.

  • Malcolm Todd 1st Jun '15 - 9:41pm

    Eddie and Philip

    I’m sorry, but this just won’t wash. Your calculation, Philip, just proves an identity: the system is designed to look that way, but it depends on the fundamental fiction that your “net of basic rate tax” pay is somehow the real measure, as if tax up to that point is an act of god, and only the “extra” tax you pay as an additional rate payer is what counts. But it makes no sense, in economics or equity.

    At its most basic level, what happens is that a business pays out a certain amount and the employee, or shareholder, or self-employed person gets some, while the government gets the rest. Looking at the example of a higher rate taxpayer, and dealing just with the marginal rate, what happens if a business uses up £1,000 extra of its gross income on paying each class of person? (A warning to anyone following so far: in what follows there is some maths, and a certain geeky obsession with accuracy and precision.)

    For the shareholder, corporation tax – at 20% – comes out first, leaving £800 to be paid to the shareholder. As a higher-rate taxpayer, you will then have to pay 22.5% of (£800/0.9) (based on the notional tax credit of 10% and notional tax rate of 32.5%), i.e. £200, and so receives £600 of the business’s outgoing, so an effective tax rate of 40%. (I.e. the government takes 40% of the total payment, the employee 60%.) Fine.

    What happens if the business decides to spend £1000 on paying a higher-rate-paying employee? Well, first there’s employer’s NI of 13.8% – as that’s based on the employee’s pay after paying employer’s NI, that’s 13.8/113.8*1000 or £121.26. On the employee’s theoretical pay of £878.74 they then pay 40% tax plus 2% National Insurance, making £369.07. That leaves the employee with £509.66. So the effective tax rate here is not 40% (never mind 25%!) but just over 49%.

    As for a self-employed person (who in effect, by working as a sole trader rather than incorporating, “decides” to pay him/herself all of the business income): here, there is at least simplicity. On that extra £1000 you will be taxed 42%.

    So: shareholder 40%; sole trader 42%; employee 49%.
    Perhaps you can make a case for the disparity in marginal rates. (It’s worse for basic rate taxpayers, by the way: shareholder 20%, sole trader 32%, employee 40%.) But please don’t pretend it doesn’t exist or that it’s an insignificant amount.

  • Malcolm Todd 1st Jun '15 - 9:47pm

    Matthew Huntbach

    Okay, I’ll do little picture, you do big picture! I can’t fault a word of your reasoning here.
    (Well, except that I do understand the rationale for calling inheritance tax a tax on “aspiration”, which is that people “aspire” to make lots of money and leave it, preferably tax-free, to their children. Well, tough. Leaving 60% of it to the lazy little gets ought to be incentive enough.)

  • Eddie Sammon 1st Jun '15 - 9:58pm

    Malcolm, what about 20% VAT? You say “employer’s NI” so I say “VAT”. Producing big calculations isn’t going to win votes. At the end of the day there is no appetite for more taxes on small business owners, which is why they generally don’t vote Lib Dem.

    Regards

  • Malcolm Todd 1st Jun '15 - 10:05pm

    Eddie, don’t be ridiculous. You pay national insurance on money paid to your employees. You don’t pay VAT. Correct me if I’m wrong, but I don’t believe you pay VAT on dividend payments either. So it’s simply irrelevant.
    And I’m not producing “big calculations” (are you scared of numbers?) to “win votes” but to explain why I think your special pleading for shareholders is unconvincing. Without doing “big calculations” how exactly do you expect to show people that it is fair for shareholders to pay nothing in tax on dividend income, if they are basic rate taxpayers? It’s only by looking at the numbers behind it (i.e. the fact that dividends come out of post-corporation tax income) that you have even the vestiges of a case.

  • jedibeeftrix 1st Jun '15 - 10:10pm

    @ Matthew Huntbach – “It’s even more nonsense when they say inheritance tax is an “attack on aspiration”. Just how is letting those lucky to have wealthy parents sit around leading lazy unproductive lives because they know they’ll be getting their big dollop of inheritance cash some day an “attack on aspiration”?”

    By ‘sitting around’, are you imagining some enormous trust fund?

    I wouldn’t make the aspiration argument myself, tho it seems perfectly reasonable, my objection is that it is THEIR money that THEY earned, and that should be up to THEM how they choose to dispose of it.

    Is it too much to ask of society that they ‘generously’ allow a couple to bequeath their family home plus some nominal amount in cash assets to their family/cattery? i.e. the value of an average family home x2. What the hell, let’s say x4, it is their money!

    The reason i have a mortgage is because of an inheritance, and deeply grateful i am too. However, i don’t point this out to say that I deserved the leg-up in life, no. Rather, i make the point that my grand-parents of working class irish-catholic stock from liverpool – a print worker and dinner lady – earned the right to pass on whatever they accumulated in life to whomever they please.

    Six grand children and two surviving children, along with however else they chose to divide their estate would make short work of the £300k cap these days.

  • Eddie Sammon 1st Jun '15 - 10:41pm

    Malcolm, if I am VAT registered and I charge someone £1,000 for a financial plan I have to pay 20% VAT, then 20% corporation tax and if I am a higher rate tax payer 25% dividend tax on top. The total tax take is 52% and that is why I don’t want to see it increased.

    It feels too much and if people don’t agree then they can cut employer’s NI, but none of these taxes should be going up.

  • Malcolm Todd 1st Jun '15 - 11:10pm

    Sorry Eddie – if you were a sole trader (with a sufficiently high turnover) or a company, you’d still pay VAT as well. Doesn’t change the calculation.

  • Eddie Sammon 1st Jun '15 - 11:20pm

    Malcolm, I see the point you are making, but I could continue arguing against it by bringing in employment rights and other taxes, but really I think it is besides the point. The main point is I don’t want taxes to go up on small businesses and economic analysis is useless if people are going to use it to come up with policies that won’t win votes.

  • Eddie Sammon 1st Jun '15 - 11:27pm

    Even if I use your point of “incorporated and non-incorporated businesses pay the same taxes” then the Lib Dem manifesto included restrictions on corporation tax relief and increases on corporation tax for the banking sector. These are all effective tax increases on businesses.

    But please, I am not here to conduct detailed economic analysis – it is to develop policy. If you believe in the harmonisation of taxation on earned income then I would ask for a cut in employer’s NI.

  • Malcolm Todd 1st Jun '15 - 11:40pm

    This isn’t detailed economic analysis, Eddie, it’s just basic maths.
    For economic and political analysis (expressed, if I may say so, with unusual brevity) see Matthew’s two posts above.

  • Eddie Sammon 1st Jun '15 - 11:44pm

    Malcolm, I am smarter than you think. If you want to play mathematical games we could start quantifying the risks of dividend income versus employment income, but that would be overkill, so let’s not go down that route and stick to talking about the Lib Dem’s approach to small businesses.

    If you came in and said “you have a point about small business owners not wanting to pay more tax, but you are wrong on the analysis” then I would listen, but it just felt like you were nitpicking, and as I said above: we are not comparing apples with apples.

  • Jonathan Pile 1st Jun '15 - 11:47pm

    I agree that we need to once again be the party of small business – I run one. we are the overtaxed , late paid lynch pin of the economy. a 10% tax small business tax rate for sole traders would be a start . Good idea to balance more social liberal policies needed

  • John R G Bland 2nd Jun '15 - 12:20am

    The calculations produced by Malcolm are of course a correct interpretation of something I deal with every day. The higher rates of tax and National Insurance Contributions are the key driver for businesses to incorporate as Companies. A company then pays its Director a small salary below the NIC threshold for which it gets a Corporation tax reduction and then pays its shareholder(s) usually the Directors a dividend. Thus when a sole trader grows big enough where the tax savings are obvious and if they take the small salary – high dividend route then the potential tax that goes to the treasury falls and the bigger the business and the more lavish the lifestyle of the Company Director/shareholder the bigger the difference is in cash terms.

    Now in the past, Gordon Brown introduced a 0% tax band for companies on the first £10,000. The result was a record number of incorporations as a small business with only £10,000 profit could pay it all out as Company without a penny being paid in tax as a basic rate taxpayer had the 10% notional tax credit. It did not take long for that to be reversed. I give this past example of a policy that had not been thought through as it points to the one driver that any business owner thinks about which is how much tax does he or she have to pay and what can they do to reduce their tax bill.

    In theory a Company is formed to enable the business owner to attract outside investors enabling shares to be issued with limited liability to that investor (thus if an outside investor pumps in £10,000 and the majority owner makes a hash of things the outside investor only loses £10,000). Now those Companies that go down that route and don’t spend their time worrying about losing total authority in the business and worrying about saving the last penny in tax and concentrate on expanding their business do generally grow and become success stories. I am sure we can all think of highly successful companies that were started by one person.

    Those businesses where the owner wants to retain full control on the decision making and day to day running of things tend to grow to a certain size and often when the owner retires or dies that is the end of the business – however there may be some merit in trying to find ways for employees who know the workings of the business to buy it out – various share option schemes have been tried and have either been abused or have failed miserably.

    When the minimum wage came in there was some concern that in the case of proprietor owned companies that the small salary high dividend route might be targeted by HMRC using minimum wage legislation but this has never happened probably because it would be dynamite.

    Going back to the original post, there was a time when business owners did get engaged in local communities and even local politics and vice versa. My Great Grandfather had a Horsebus Company and when he wanted to grow it he obtained outside backing from four local Aldermen, who also owned shares in the local gas company and some others as well as running their own businesses . These were however different times (Victorian) where attitudes and morals were somewhat different. One of the minor shareholders queried whether the Horsebus Company should be buying hay from another business owned by the Managing Director (only to be told that the Managing Director did not take a salary for running the horsebus company). Such arrangements today without interests being declared would cause uproar and difficulties. Say if a computer seller went on the board of a school and the School purchased computers of him after a genuine tender process. Some would still attack it even if he sold them at cost price or a loss. I have come across cases where people have shied away from public service because of the need to declare interests. We all know why the rules are there, but have to accept if we are going to be transparent, we may put off those who take a principled stance on privacy.

    I agree that business owners and also employees come to that involved in business administration do offer skills that many local charities for example would find useful. I have often felt that given that charity committees may have to meet with potential commercial partners to arrange an event, as you are not going to get employees of say a local exhibition organiser or council agree to meet in the evening that such duties on behalf of charities should automatically be classed as a public duty and qualify for time off work without any form of discrimination. Whist business owners can take time off for such things, Managers who are employed can’t and they would be able to offer similar skills.

    Where Liberal Democrats can be helping small businesses is to seek reform of red tape and regulation that many businesses have to consider. Vince Cable undertook a lot of this work whilst in Government, but there is still so much more to be done at National & European levels. This is the area we need to focus on as well as pushing for decent broadband speeds in all parts of the country as a given right to promote the digital economy.

  • Malcolm Todd 2nd Jun '15 - 12:30am

    But I’m not going to start by saying I agree with you if I don’t, am I Eddie? That’ would just be dishonest. I mean you’re surely right that small business owners (mostly) don’t want to pay more tax but what group does? That doesn’t prove that they’re not receiving favourable treatment or that such favourable treatment is justified.

    We could indeed , meanwhile, look at quantifying risk. That would be a valid argument, if you could find a way of quantifying it that made sense. That would be doing what I asked you to do: justifying a discrepancy rather than denying it exists.

  • Malcolm Todd 2nd Jun '15 - 12:37am

    Oh, by the way – my apologies for abrasiveness of tone, Eddie. I certainly didn’t mean to imply that you’re not smart enough to understand the maths! With your background, I imagine you could run mathematical rings round me should you choose to try. It’s the politics of the thing that’s important.

  • Eddie Sammon 2nd Jun '15 - 12:40am

    Malcolm, apologies for reacting too negatively at first. You have a point about employer’s NI, but I think my gut instinct on the matter also has a point. :p

    I don’t mean to sound anti-intellectual – I like good economic analysis, I just didn’t want it take over the political point I was making.

  • Matthew Huntbach 2nd Jun '15 - 6:20am

    jedibeeftrix

    I wouldn’t make the aspiration argument myself, tho it seems perfectly reasonable, my objection is that it is THEIR money that THEY earned, and that should be up to THEM how they choose to dispose of it.

    Well, it is MY money and I have earned it, but if I give it to someone to buy something from them I have to pay VAT on it, and if I give it to someone to do a job for me they have to pay income tax on it. So what’s the difference? Why should this money be treated any differently?

    As for “aspiration”, I’m sorry, but the Tories are fond of using the argument that it’s wrong just to give people money because it means they sit around being lazy instead of going out and getting a job. Why does that apply when it’s a welfare payment but not when it’s inheritance?

  • All political parties say “nice things” about small business.

    I would urge you to step back and think this through.

    What is so special per se about small business operators? Are they less ambitious than the medical researchers who have just made a breakthrough on cancer cures (people who “just” draw a salary every month)?
    Are they less dedicated than the volunteers who turn up at the local hospice every week to selflessly comfort those in need? Do they do more for society than the bus or train driver who takes responsibility for their passengers’ safety working unsocial hours?

    If as illustrated in the picture at the top of this article the small business makes money out of retailing trendy stuff to the middle-class salary earners maybe there is no room to be too impressed by the moral superiority of small business over the people who “just take a monthly salary”.

    Just some thoughts. Just trying to it things into context.

  • Matthew Huntbach 2nd Jun '15 - 10:14am

    jedibeeftrix

    There is a fundamental difference between being free to with your [own] resource as you so please, and the notion that society should have no interest in the behaviour of those that [receive] resource due to need.

    That does nothing to answer my point about “aspiration”. Nor does it answer my point about when I pass my resources to people in other ways, tax has to be paid, so what’s the difference here?

    I appreciate there are emotional issues here, yes. But if so, put it that way. Don’t pretend that being reluctant to tax inherited wealth is a matter of “aspiration”.

  • Matthew Huntbach 2nd Jun '15 - 10:47am

    jedibeeftrix

    Rather, i make the point that my grand-parents of working class irish-catholic stock from liverpool – a print worker and dinner lady – earned the right to pass on whatever they accumulated in life to whomever they please.

    Well, as I have already said is this not an argument against any form of taxation?  If they chose to pass on their wealth to buy something some of it would be taken in VAT, if they chose to pass it on to someone to do a job, some of it would be taken in income tax.

    You are able to buy a house not just through your own effort, but in reward for your grandparent’s hard work. Your children and grandchildren will similarly be rewarded for your grandparents’ hard work. How much reward must that work be given? People who did not even know them, who are four generations removed must be rewarded for it, according to you.

    The free market means the price of houses is what people can afford to pay for them. It used to be approximately three times annual wages on the grounds that’s the sort of mortgage one can obtain. But if now it’s standard for everyone to be able to bid three times their annual wages plus what they can get from the sale of an inherited house, what does the price becomes? Three times wages plus the cost of a house. But, hang on, since the cost of a house is three times wages plus the cost of a house that means it’s six times wages plus the cost of two houses which means …

    It means that without some sort of control in the form of property and/or inheritance taxes, there’s bound to be an upward spiral in house prices. When the sort of house people can buy is determined not so much by their own effort but by the effort of their ancestors, what does that mean? Well, I am suggesting it means the opposite of the Tories’ claim, which the Labour leadership candidates seem so frightened of that they’re all joining in with it and saying “yes, we too must pump out the Tory line about aspiration”, that such taxes are an attack on aspiration. If we want to reward people for hard work, surely we want to make sure that the prime factor in what sort of life they lead must be reward for their own hard work not for that of generations past.

    As I have already said, I appreciate the emotional issues here, which is why there is a need for serious discussion about it, which is why I am questioning what I think are very weak lines put forward by the Tories which others seem to want just to accept. Alain Desmier made some vague comments about “entrepreneurialism” and the like, so vague it was hard to know what he really meant. But the Tories HAVE used that sort of line to oppose property taxes and inheritance taxes, indeed it seems that actually when they attack others for being against “entrepreneurialism” and “aspiration”, that actually is the MAIN thing they mean. What is more, it seems others use it to mean the same sort of thing, which is why I am questioning Alain Desmier to see if he too means that. If he doesn’t, since the Tories use it to mean that, others might easily take it that his comments should be interpreted that way as well. They were so vague, so unless there is something more specific said, people will naturally suppose there’s a “me too” to the Tories here.

    If the emotional arguments are so strong that inherited wealth can never be taxed, all taxes must instead fall on earned wealth, well, if that’s what people want they must consider the consequences. Far from it being a reward for aspiration and entrepreneurialism, it’s a recipe for a return to a feudal society, where one’s position in society stems not from one’s own work and effort but from whom one’s parents were.

    People must also consider the straight practical issue that if they want the state to pay for something, that means taxation. People wanted university study to be fully state funded, and the Liberal Democrats were destroyed, so we are told, because they said they wanted that, but were unable to provide it. Well, ok, but if people think taxes are so bad, should they not be applauding the Liberal Democrats for their U-turn, since that U-turn saves them from the heavy taxes that would have been needed to meet the pledge? I read today about some drug which costs £49,000 to administer, and gives cancer sufferers a bit more life time. and people saying how unfair it is that it should not be available on the NHS. Well, ok, but if it is, that £49,000 has to be raised by £49,000 tax on something, so what is that something to be?

    I see a great deal of money being passed between people stemming from property ownership, and as you say about yourself it’s becoming an increasingly important factor in people’s lives. So if we say it’s wrong to tax that and right only to tax money that passes as payment for work, what does that say about us? I say for sure – it does not mean that we value entrepreneurialism. I rather think it says the opposite.

  • Mike Turner 2nd Jun '15 - 11:32am

    The issues that impact on ‘micro’ businesses [1 to 9 employees] – of which there are about 4million – are often significantly different from those impacting ‘small’ businesses [10 to 49 employees] – of which there are about 1million, and in turn these are different from ‘medium’ businesses [50 to 250 employees]. These groupings are also sensitive to the nature of the business. 50 employees in a manufacturing business is not so big whereas in a more ‘service’ type industry could be considered substantial. Hence the complexity in all the fantastic comments above. There is clearly no ‘ one size fits all’ policy. We need to do a lot of strategic thinking about a) groupings b) issues that concern each group c) issues that overlap groups and then A) appropriate policies B) How can we present them in such a way as the voters are interested and understand.

  • @John Tilley small businesses create jobs for people which creates a multiplier effect in the economy – corporation tax, income tax and VAT are raised for the exchequer and money is spent by those employed.

    There’s nothing to say that those other things aren’t good; its more that the wealth generated by small businesses is ultimately what creates the taxes that you’re so keen on spending.

  • Peter Watson 2nd Jun '15 - 2:29pm

    @JohnTilley “What is so special per se about small business operators? Are they less ambitious than the medical researchers who have just made a breakthrough on cancer cures (people who “just” draw a salary every month)?”
    A lot of “small business operators” are indistinguishable from those who draw a salary every month, and are certainly not “entrepreneurs”. In large companies and organisations there are many contract and agency workers who, while turning up and working 9-5 and looking like employees, are actually managing directors of limited companies with one employee that are set up to reduce the amount of tax paid by that one employee. Perhaps many of the agency nurses in the news today manage their tax affairs in this way. In effect, individuals are trading some of their employment rights for a larger nett pay, and the “employer” is getting a more flexible (disposable) workforce, often at no extra cost. The calculations by Malcolm Todd above illustrate the attraction for an individual to work in this way, taking income as a dividend (and that’s before we get into other ways of gaming the income tax and VAT system). IR35 was supposed to reduce this sort of disguised employment, but seems to have had little or no effect. There is a world of difference between genuinely entrepreneurial small businesses and limited company contract workers, and the tax system should recognise this somehow, perhaps with a rebate or allowance for particular types of activity rather than by bluntly tweaking tax and NI rates for all companies.

  • @ JohnTilley
    I may be completely wrong here, but arn’t schools and hospitals funded by taxes on the private sector? And aren’t nurse, train drivers or tax collectors funded by taxes on the private sector?

    As you seem to be very much anti-big business, and apathetic towards small business, in your ideal world how would the funds to run the country be generated? Are you a fan of the Cuban model?

  • David Allen 2nd Jun '15 - 4:37pm

    Isn’t it pathetic that Cameron and Osborne were always in yellow hi-vis throughout the election campaign, while Miliband never was?

    What does that achieve? Social division and mutual incomprehension. An instruction on how to vote. “Private sector to the right, public sector to the left.”

    Once upon a time we made the case that a decent government would work for all, not just take sides. Once upon a time.

  • “Well, it is MY money and I have earned it, but if I give it to someone to buy something from them I have to pay VAT on it” (Matthew Huntbach)

    Well that isn’t totally true. Due the VAT regulations, you can pay not dissimilar prices for something, but one person may be VAT registered and hence the price will include VAT and someone else may not and hence the price doesn’t include VAT. So if you are savvy you can avoid paying VAT. However, you can do so with a honest heart, as your purchasing decision is helping a small business that may one day have the joy of becoming VAT registered.

    I know I’m being slightly tongue in cheek here, but with friends with businesses that have been trading around the VAT threshold for a couple of years now, I tell them this is a sign of success. However, yes making the move to becoming VAT registered is not to be taken lightly and has headaches (particularly if a significant proportion of your business is export) and financial penalties, but a few years back these same people stepped into the unknown and thought the business might earn them some ‘pocket money’ and through their efforts have achieved significantly more.

    So yes I do begrudge handing ~63% of the monies I raise invoices for, to HMRC; but I pat myself on the back for having a business that has this problem – I just wish I could find the key that will enable me to increase the monies that I can legally retain in the business and so take things further…

  • Thomas Salter 2nd Jun '15 - 5:02pm

    @Mike Turner

    Thats a very good point. Being a co-owner of a micro-business myself , I often come up against the ‘small business’ barrier. When I visit organisations and bodies set up to help small business, it becomes apparent those they deal with are pretty well established. There certainly needs to be consideration for those right at the start of the journey and being able to grow, especially in those precious first few years. And also distinguishing the difference in each sector, 50 people for an industry that I’m in would be classed as huge.

  • @Mike Turner – Good point, also to add to the complexity, business that transition between the broad groupings you outline also have particular challenges.

    I think this article in general is probably another angle on the point discussed recently on LDV: “Opinion: Demonisation of the rich is killing progressive politics”. the party needs to find ways of saying it is okay to aspire and do well and embracing those that do.

    I think from the comments here, that there is some confusion between individuals and business. To me Jack Cator (see http://www.bbc.co.uk/news/business-32702501) for example is a lucky young man, who now has the “good fortune” of a windfall tax problem. However, the business he founded and ran for several years is a different proposition. Hence at one level we need to find ways of embracing those who aspire to create wealth and helping the many small businesses they found and run to carry on trading and if feasible grow. But also recognise that not all businesses will succeed.

    One of the dapt things about the current benefits system is that it is designed to ‘serve’ a particular clientèle, which doesn’t really include those who take the step out of normal employment into the uncertain waters of business startup.

  • Alain,
    The debate above has been mainly about business taxation, which is fair enough since your piece was directed to this, and what best to do about business taxation.

    However, you slipped in some major non-sequiturs. The irrefutable fact that lib dem governments create prosperity, for example. Labour opposition drifting to the hard left. labour battles to out left wing the SNP in Scotland.

    There is nothing irrefutable about what happened in the last government. Looked at objectively, a government borrowed massively to subsidise social spending during a major recession. Classic Keynsian, left wing policy. Somehow miraculously dressed up as austerity. Virtually identical to what labour would probably have done, based on what they did do and what policy plans were already in place at the treasury. Sure, labour would have spun it differently, eased off on the bedroom tax coupled with compensating more tax on the rich for example, but truly not much different. Sure, there is a major difference in ideology, but firstly this is spun to be greater than it really is so as to differentiate the parties, and secondly, all parties ALWAYS chase the middle ground and temper their ideology accordingly.

    As to labour drifting to the hard left? As someone said, where exactly did they propose wholesale nationalisation, confiscation of assets, compulsory workers councils to run business, and so on? Nope. Moreover, if anything, they are likely now to swing back to the right, having just tried a leader from the left.

    Labour trying to outdo SNP to be more left? whew, no! the SNP have performed the trick which libs have used so often in the past. Appeal to both the right and the left. They are a nationalist party, they stand for the rights of the Scots against the oppressing English. Something the conservative party has sought to do also, with very much less success, against the opressive EU. Something which liberals need to do , at least as far as appealing to both right and left is concerned. Liberals help the other parties if in a two party electoral system they accept the concept that labour are left and conservative right. A viable alternative position is not an average between these two, especialy since in so many ways they agree with each other anyway.

    Sure, figure out a fair approach to taxation. The debate on this page suggests it may not be quite so easy to do. Supporting small business is to my mind quite obviously a socialist policy. It is a means for the individual to take control from established power blocks, and it always was. I am aware this is not how people tend to define ‘socialism’, but that is all part and parcel of this problem of accepting the premise defined by the two party system, rather than fighting for something else.

    Society has evolved, and it is now widely accepted that the mass labour movement is no longer a social imperative. Its place has been taken by government action and services, which guarantee basic living standards to every citizen. This is now a prerequisite to the kind of society we all live in, and the great majority want to live in. Conservatives tread in fear of being seen to attack the NHS, though a background fight continues seeking to privatise services which the state must provide as part of the modern compact with the electorate. There is incredibly dubious economics applied to support particular ideologies over how best to provide state services, but everyone claims they want to maintain them.

    Regarding other points, uncontrolled immigration is obviously unsustainable and not in the national interest. We would all be happier citizens if this country had half the population it does. This does not mean I oppose the EU right of movement, but it does mean we need to reconsider this problem. It is fighting reality to claim a higher population makes our lives better, so honesty must come into this debate. What we need to address as a start, is subsidy to citizens to have or bring up children. At the same time, those subsidies were originally intended to give children a better start in life, and they fail. We need alternatives so that life chances are improved. Sure, there are difficuties within the EU right now because of wealth disparity which have contributed to labour migration, but longer term this will settle down, as it did with the examples of earlier poor european countries which became wealthy, such as the UK. The great beenfit of the EU as a single market is that it is group of pretty alike countries, whatever UKIP may say.

    I’m afraid that during my lifetime, getting unfortunately extended now, ‘ We’re a federal, democratic party; a national party for the whole country, not a voter base,’ has not been how liberals have succeeded. I tend to post glibly abut the liberal party, but perhaps the social democrats had some relevant pointers here. Fighting for peoples rights does not mean being excessively nationalistic or elitist right, nor militantly and revolutionarily left. To me the liberal party has owed its success to standing positively for something other than the established parties, and this has frequently meant local issue politics, not nationally defined targets. This is why the coalition was so disastrous. It completely replace the emphasis on a third way with becoming a lookalike of the other parties.

  • @ Danny
    “Supporting small business is to my mind quite obviously a socialist policy”.

    How? I am sure you must have heard Socialism being referred to as the collective ownership of the means of production right? How do small businesses fit that description?

    Clearly Capitalism can be “a means for the individual to take control from established power blocks” if that’s what small business’s are doing, and you have an aversion to the word “Capitalism” for some reason.

  • If anything socialists should encourage big business, far easier to regulate or nationalise a corporation than millions of pesky petite bourgeoisie businesses.

  • @Danny “What we need to address as a start, is subsidy to citizens to have or bring up children”

    I agree with your premiss about over-population – having visited New Zealand last year it was fascinating to see the difference living in a country where there are less than 10% of the population of the UK in a similar area makes. However – the issue is how do you manage population decline? If you have population growth below replacement level you end up with a situation where at some point you have too many dependents per worker.

    And believe me – the state may subsidise parenthood but from the perspective of a parent it doesn’t feel like it. Usually parenthood involves a double hit on disposable income, both from the loss of earnings and from the cost of child-raising.

    And let us not forget, that it is those children who in the future will create the wealth for the pensions and perform the ongoing care of those who haven’t had children and who have paid only a tiny fraction of the true cost of raising other people’s children to look after them in later life.

  • Alistair Heath came up with an idea to stop international companies dodging and which would help small business: only tax dividends. All companies wishing to operate in the UK have to set up a company. Shareholders only receive a reward when they are paid dividends. Mega Company has to set Mega UK to operate in the UK. Mega UK may make no profits for years. When it decides to take dividends out of Mega UK to repatriate to Mega , then these taxed at 25% and only a clerk needs to be employed to undertake calculations. This benefits small and British based companies.

    Complexity of tax laws benefits accountants , lawyers and large international companies who can move money around. Profits can be manipulated, a sale of an asset can produce a one off large profit. Large investments may reduce profits.

    Scrap NI payed by employers . Welfare system should be like Beveredge designed and most of Europe operate , a contributory system.

    The answer is 25% tax on dividends . P Green avoided paying tax on £1.2 B of dividends because wife was tax exile in
    Monaco. This way 25% tax on £1.2B would be £300 M.

    For every hour and every £1 a company spends thinking about tax and paying accountants, is time and money which could have been spent growing the company. If the shareholders want to keep the money in the company in order to grow it, they should not be taxed. VAT was introduced by V D’Estang because of taxing dodging in France.

    Also all those not registered for UK tax would have to set up a UK based company to own property in the UK. Any increase in value when property sold would be taxed at 25% , in effect taxing dividends. Much private equity and property speculation only produces profits because of manipulating the complex tax laws. Make tax laws simple and with low rates and then it makes it difficult to evade and less profitable. Complicated tax laws and rates at 80% are the perfect combination to promote tax dodging and make it possible. Part of the decline of the UK industry from 1945-1985 was that it was easier to increase profits by complex accountancy manipulation than create new products. A former BP engineer said to me that before the 1960 accountants they had little power, now they run industry. What can be good from an accountancy/tax perspective can be bad for developing new technologies : a major reason why R and D programmes are often cancelled. Sony’s founder considered the large number of accountants in the UK absurd. I would argue that the size and wealth of the UK accountants and tax lawyers symptoms of the problem.

    A part of the W Germany’s economic miracle from 1948-1963 was the lack of regulation, especially taxation.

  • @Charlie “Complexity of tax laws benefits accountants , lawyers and large international companies who can move money around. Profits can be manipulated, a sale of an asset can produce a one off large profit. Large investments may reduce profits. ”

    Absolutely.

  • Alain Desmier 2nd Jun '15 - 6:25pm

    @Danny Thanks for your points. Non sequiturs or otherwise, I didn’t actually mention tax once during my piece, I was actual careful not to and I certainly didn’t direct anyone to it.

    My views is that jobs, employment and careers in the UK have dramatically shifted over the past 10 years, and the rise of the self-employed freelancer, the entrepreneur and the start-ups create new electoral opportunities for us. (I’ve listed the similarities between running your own business and being a Lib Dem before https://www.libdemvoice.org/opinion-dont-tax-aspiration-lets-recruit-entrepreneurs-to-our-cause-42835.html – this piece was about tax, please nobody explode!)

    “We would all be happier citizens if this country had half the population it does” – As someone from a family of immigrants, you’re going to struggle to convince me of that one!

    Are we the party of enabling aspiration? We should be.

    @Roland is right we’ve got a long way to go yet but I think it’s through discussions like this, that we can start reaching out to liberals, who aren’t yet Lib Dems.

    No comments on encouraging our entrepreneurial members and supporters onto governing bodies of schools, hospitals and charities? Anyone think it’s a good idea?

    (The Lib Dem Entrepreneurs network has had a number of new sign ups over the last few days, thanks to everyone that’s shown interest, we’ll be in touch very soon.)

  • Adrian 2nd Jun ’15 – 3:27pm
    “…..I may be completely wrong here, but arn’t schools and hospitals funded by taxes on the private sector? And aren’t nurse, train drivers or tax collectors funded by taxes on the private sector?”

    You are not completely wrong, just substantially wrong. Your first assumption seems to be that all schools and hospitals are state schools or hospitals inThe NHS. You then assume that anyone who works in such places is employed by them rather than being employed by an agency (which could of course be a small business.

    You go on to make other assumptions about what I believe.
    Your suggestion that I –“seem to be very much anti-big business, and apathetic towards small business” is odd because I have said neither.

    I am not anti-business of any size although I do have a problem with the out-of-control, corporate monsters that corruptly fiddle the banking system for their own personal gain — but then so does the USA Justice system which puts such people in prison.

    You finish by asking —
    “.. Are you a fan of the Cuban model?”

    Which Cuban model do you mean? The last thing that I heard about Cuba was that the Cuban government was encouraging small business. Do you have a problem with that?

  • Matthew Huntbach 2nd Jun '15 - 10:46pm

    TCO (in reply to John Tilley)

    There’s nothing to say that those other things aren’t good; its more that the wealth generated by small businesses is ultimately what creates the taxes that you’re so keen on spending.

    So why, if it’s just a few lefty old-fashioned Liberals like John Tilley who don’t agree with the new orthodoxy that the lower state spending the better, were the Liberal Democrats supposedly destroyed in the 2015 general election for not being keen on spending taxes on university education? Surely by the arguments you are using, the defeat by Nick Clegg of those nasty Tilley-type activists who forced that spending policy on the party should have been applauded. Surely, by the arguments you are using, the shift of the Liberal Democrats under the coalition towards a position which is keen on having less taxes and less government spending should have attracted much new support to the party.

    Well, indeed, there was a time when we were told that would be so. We had the Rose Garden love-in, and all this attempt to look like serious politicians, and we were told by Clegg and the Cleggies that would work wonders for our party. There was some big batch of people out there, so we were told, just waiting for us to become the sort of conventional “party of government” we became, and drop all that lefty tax-and-spend stuff. So, TCO, what happened? Why didn’t all those people come and vote for us?

  • Matthew Huntbach 2nd Jun '15 - 10:50pm

    Alain Desmier

    Are we the party of enabling aspiration? We should be.

    Well who would say they were a party of disabling aspiration?

    The point is, if that is not just to be a meaningless platitude, what exactly do you mean by it? What particular and distinctive policies should be pursue that would mean we are proposing more to “enable aspiration” than any other party? As I said, the Conservatives seem to think it means abolishing inheritance tax and not having any sort of tax on big underoccupied properties. What do you say?

  • Matthew Huntbach 2nd Jun '15 - 10:52pm

    Alain Desmier

    No comments on encouraging our entrepreneurial members and supporters onto governing bodies of schools, hospitals and charities? Anyone think it’s a good idea?

    As I’ve already said, these are very time-consuming pursuits. Why should an entrepreneur spend many hours sitting on all the various committees and dealing with all the various paperwork that being a school governor involves? Surely he or she would be much too busy running their business to have time to do that sort of thing.

  • Let’s get real about what is and isnt a small business.

    My partner and I run a convenience store and post office and currently work 120 hours a week – not from choice but because we can’t afford to employ staff to give us time off, other than a few hours on Saturday afternoon. We then have to do additional hours doing the ordering, accounts, VAT, NI, payroll etc etc

    We employ 3 people part time to cover the busiest periods when we cant cope.

    If either of us is sick, the other has to pick up the slack, as I had to do when my partner was off for 10 weeks.

    If any of our staff is sick or on holiday, not only do we have to pay them, we either have to work their hours or pay somebody else to cover.

    And for all this we have a combined income of around £28,000 – given we have so little time to spend any, thats fine.

    And despite the hours we spend, we have no safety net, no benefits system to fall back on – nada.

    Starbucks et al manage to dodge tax in assorted dubious but legal ways, so why not offer the real small business grafters an incentive.

    I would suggest that any party that offers not small, but micro, businesses of say under 5 employees a decent tax system, (10% on profits up to £40,000) that reflects their hard work would not only encourage people to start small businesses but also makes it possible for micro businesses like ours to employ more staff.

    And for all those who say that puts you off employing more people, no, a sensible ramping versus cliff edge system would not have that effect if the ramp was gentle enough.

  • Alain Desmier 3rd Jun '15 - 7:09am

    Hello @ MatthewHuntbach

    This blog post was not about what I wanted to see from a small business taxation system, I didn’t mention tax at all in my piece. Given the comments, though, it’ll definitely be my next piece!

    I said three things:

    1 – Open, free movement of people is essential for the type of small, Internet based business I run. Labour and Tories both have anti immigration policies and we should make this clear to job creators, the Lib Dems believe in the free movement of people.

    2 – Digital infrastructure is vital to ensuring we can share out the wealth, jobs and tax revenue from an ever-increasing number of Internet businesses. Bournemouth is a great example – 80% of the media graduates on new media courses at BU end up in jobs within the M25. If we solve that, we can start solving the brain drain to London.

    3. When we knock on the doors of business owners in our local community, we ask for practical delivery help and money, which are essential. What if we also said, “there are all of these amazing schools and hospitals that could benefit from your time and expertise”, there is more than one way to make your local community more liberal.

    Rather than just take your attitude and assume it’ll be too much work, I run a young business and sit as a Governor for a local school. I find it rewarding and engages a part of my brain I don’t use in my commercial life. I’m also a much better Governor then I would be a candidate and enjoy this as my contribution to my community via my local party.

    I think we come at this from two different points.

    My agenda is to try and get more Liberal minded business people interested in the party so that when we come to conference, we can develop a tax system, which is both fair and progressive.

  • JohnTilley 2nd Jun ’15 – 7:36pm
    “You are not completely wrong, just substantially wrong. Your first assumption seems to be that all schools and hospitals are state schools or hospitals inThe NHS. You then assume that anyone who works in such places is employed by them rather than being employed by an agency (which could of course be a small business.”

    I am aware of this, it seemed to me in your of contrasting of education, public transport and healthcare workers with small businesses that you were not aware of it. Glad we are on the same page.

    “You go on to make other assumptions about what I believe.
    Your suggestion that I –“seem to be very much anti-big business, and apathetic towards small business” is odd because I have said neither.”

    Fair enough, but I am sure you can understand how I could interpret comments such as “the small business makes money out of retailing trendy stuff to the middle-class salary earners maybe there is no room to be too impressed by the moral superiority of small business over the people who “just take a monthly salary”” as apathetic towards to small business. You regularly make many similar comments regarding big business on this site (sorry I don’t have time to quote) which I have obviously misinterpreted as well.

    “I am not anti-business of any size although I do have a problem with the out-of-control, corporate monsters that corruptly fiddle the banking system for their own personal gain — but then so does the USA Justice system which puts such people in prison.”

    In that case we are in agreement, do you meet many people disagree with you on this? I would be surprised if this were the case.

    “Which Cuban model do you mean? The last thing that I heard about Cuba was that the Cuban government was encouraging small business. Do you have a problem with that?”

    Fidel era, you know, the good old days.

    I don’t have a problbem with Cuba modernising, I think it is a very good thing . Having the entire population reliant on the state for their livelihood is not conducive to a free society in my humble opinion.

    Thanks for replying to my post, I am genuinly interested in reading your thoughts on these matters.

  • JohnTilley 2nd Jun ’15 – 7:36pm
    So just to summarise, you agree that those education, public transport and healthcare workers who are not directly employed by private businesses are funded through taxation on private businesses and therefore private business are in fact very important (as the Cubans are realising)?

  • JohnTilley 2nd Jun ’15 – 7:36pm
    …and out-of-control, corporate monsters that corruptly fiddle the banking system for their own personal gain need to be adequately dealt with by the law. But I think that goes without saying.

  • Adrian 3rd Jun ’15 – 9:07am

    Thanks for your considered and polite response.

    I should perhaps add to my earlier comment that there was a lot from the Fidel Castro era in Cuba that I find admirable.

    It did suffer an economic blockade for all of that period and was subject to attempted military invasion by the USA. Most people in the UK were prepared to put up with a lot of state control and intervention during the 1940s when we were subject to blockade by u-boats and under threat of invasion. There are some similarities.

    The fact that life expectancy and literacy rates in Cuba went up and up (despite the blockade) so that they are now better than many states and cities in the USA must tell us something.
    The fact that Cuba “exports” trained medical staff and was the first country in the world to send doctors and nurses to West Africa when the Ebola emergency struck, also tells us something.

    I agree with you about the over-mighty Cuban state in the decades from 1960. However, the previous regime which seemed to base Cuban government on exploitative slave-like sugar production and providing a gambling and narcotics resort for The Mafia / US organised crime was not exactly a shining example of a Liberal and democratic approach.

    One does not need to be a raving communist or even a misty-eyed fellow-traveller to recognise the facts. I am neither.

  • Matthew Huntbach 3rd Jun '15 - 10:22am

    Alain Desmier

    This blog post was not about what I wanted to see from a small business taxation system, I didn’t mention tax at all in my piece.

    No, but it was very vague in exactly what it was asking for, and the words it was using about becoming “the party of the entrepreneur” ARE used by others (I mean the Conservative Party and the right-wing press) to mean “opposed to tax increases, especially tax on unearned income and tax which fall on very wealthy people”. This sort of line has been pushed and pushed so hard by those who have a vested interest in it that the rather dubious reasoning behind it is starting to get accepted as an unarguable truth – we are, incredibly, even seeing contender in the Labour Party leadership election coming out with it.

    So, you may not have meant it that way, and I did go through your article carefully to see if you did, and I couldn’t see anything that suggested you meant it that way, but then I couldn’t see much in the way of concrete examples of what it might mean to be “the party of the entrepreneur” which might clarify that and suggest you were challenging those assumptions. The problem is because big vested interests push the notion that being “the party of the entrepreneur” means just that, even if you didn’t mean it that way, others could interpret it as support for their argument that it should be that way.

    I have deliberately taken an extreme position and argued that one could equally well say policies which are the exact opposite of what the Tories say makes a party “the party of the entrepreneur” would actually be more supportive of true entrepreneurship. Well, do you really think, which is the core of the Tory argument, that the MAIN thing stopping people from being entrepreneurs is the feeling that if they do so and make money and buy a big house they would have to pay a lot of tax on it?

    Underneath, my real point is that we should question assumptions and THINK, and not just spout meaningless platitudes.

    Rather than just take your attitude and assume it’ll be too much work, I run a young business and sit as a Governor for a local school. I find it rewarding and engages a part of my brain I don’t use in my commercial life.

    No, I don’t “assume” this, I know because my wife was a school governor and chair of the board of governors for six years at the same time I was a councillor. So, we do know all about the hard work these positions involve, and the extent to which this hard work detracts from one’s ability to do other work. My own career as an academic has suffered because of the time I spent as a councillor instead of doing extra academic work (I always worked my full contracted hours) which might have got me promotion, and the same would have happened had I taken on a school governorship.

    We are always being told how incredibly hard work and what long hours people who start up businesses put into it, and that’s why we must support them. So, you seem to be suggesting I am wrong in accepting that, and instead people who run small businesses have an easy life which gives them time to be school governors and so on. OK, that’s interesting to know.

  • @Matthew Huntbach you’ve erected somewhat of a straw man argument there. I’m not against taxing and spending; but we can see from some of the comments above from small and micro business owners how “the system” is against them.

    In my opinion, there is both “a gap in the market” (Tories by default for many small businesses, though they’re ultimately more interested in the large corporates) and more importantly its the right thing to do, to rebalance the rulebook to give these businesses a break.

    We want a healthy, growing, diverse and entrepreneurial small business sector because these businesses are the life-blood of the economy, the engines of future growth and innovation, and the bedrock of our tax base in their profits and employees.

    We need a healthy and expanding small business sector to ensure the tax revenues are available to spend on the things the state should be doing.

  • @Matthew Huntbach “We are always being told how incredibly hard work and what long hours people who start up businesses put into it, and that’s why we must support them. So, you seem to be suggesting I am wrong in accepting that, and instead people who run small businesses have an easy life which gives them time to be school governors and so on. OK, that’s interesting to know.”

    There are many different types of small business. Some may be management time-intensive; some may just require a good idea and the ability to choose wisely in terms of getting investment to set the business up and employees to deliver it. If a business model is sound and the entrepreneur is astute, they can set things up in such a way that there is minimal time required other than for strategic decision making. Many entrepreneurs then use the time they’ve created to set up new business enterprises, but some might choose to use it on other things such as being a governor.

  • @John Tilley “You are not completely wrong, just substantially wrong. Your first assumption seems to be that all schools and hospitals are state schools or hospitals inThe NHS. You then assume that anyone who works in such places is employed by them rather than being employed by an agency (which could of course be a small business.”

    Well only 7% of pupils are educated in private schools who’s employees are not state employees and are not funded by the state. I’m sure its a similar proportion in hospitals too. So the vast majority (93%) are state employees in state-funded enterprises.

    People working in NHS hospitals employed by agencies are paid for by the state through taxation. So he is substantially right and you are wrong.

  • TCO 3rd Jun ’15 – 10:34am
    “….paid for by the state through taxation.”

    I agree with you. An incredible amount of so-called “private enterprise” and “independent small businesses” is entirely or predominantly dependent on government money and intervention.

    Is a plumber whose contracts all come from local MOD housing officials working In the “private” sector or working for the state?
    Is a large Chinese/French nuclear power combine whose projected income is based entirely on UK State intervention i working in the “private” sector or is it merely propped up by the apparent “socialist” policies of George Osborne?
    Do mega pharmaceutical corporations who fix their prices with various govrnments around the world to enhance their over-inflated profits work in the “private” sector”? Or do they depend entirely on state intervention?
    Are the new generation of Rachmanite landlords in the “private” sector when they get rich from £ billions in government payments to provide inadequate and insecure housing for the poor?

    Life is so much more complicated than dipping into a chapter of your favourite book, is it not?

    Anyone would ne wrong to apply a theoretical, fairy-tale view of private business (small, large or obscenely over-powerful) whilstyou ignore the facts from the world around you.

  • JohnTilley 3rd Jun ’15 – 10:14am
    I am not convinced on Cuba, maybe I will change my opinion on Cuba when there are more people on riketty boats crossing the Florida straights from the US than the other direction. But we should leave that for another time.

  • AlanDesmier

    The problem with open immigration is that it may benefit you, but not other British people. I would argue that a main problem is that British Industry has avoided investing in education and training since 1870. The East India Company set up a college to educate and train future employees in 1806 ; why do not industries set up schools to educate and train British people? British companies and industry associations have failed to inform schools and universities what skills are needed and therefore imports immigrants because of shortages . What is happening is rather than outsourcing, a company is importing labour. The infrastructure Britain or any country possesses has taken generations to develop. If companies import labour, are they going to pay for the schools, roads, hospitals, power supplies and water and sanitation people need?

    The only organisation that enters schools at the age of 13 informs people on careers are the Armed Forces who use retired officers, in particularly the Royal Green Jackets have been very successful . A retired colonel from the RGJ set up a system for a regiment where retired officers toured schools and spoke to boys as young as 13 years of age and they became oversubscribed

    Importing labour privatises profits but nationalises costs.

  • Jonathan Webber 3rd Jun '15 - 10:35pm

    Some enterprising micro business or SME should set this thread to music.

  • Matthew Huntbach 4th Jun '15 - 9:55am

    TCO

    We want a healthy, growing, diverse and entrepreneurial small business sector because these businesses are the life-blood of the economy, the engines of future growth and innovation, and the bedrock of our tax base in their profits and employees.

    Yes. so how are we to achieve that?

    If you look at what the Tories and Tory-supporters are saying it’s by not having a “mansion tax”, because having such a thing means entrepreneurial minded people won’t bother being enterprising because they’ll think “Oh, it isn’t worth it, if I make a lot of money and reward myself by buying a big house, the politicos will just make me pay a lot of tax on it”.

    Now, I think that is a daft argument, but sorry, but it WAS the core of the attack by the Tories on Labour and to some extent on us for being “against aspiration” and the like. So I’m not raising a straw man, as you accuse me. My point is that a lot of the rhetoric we hear about “entrepreneurialism” and the like is actually a way of putting forward policies which have a very different core aim, and making them seem palatable. I also think we have a real problem that too many people have just gone along with them and not questioned their assumptions.

  • Matthew Huntbach 4th Jun '15 - 10:15am

    Charlie

    I would argue that a main problem is that British Industry has avoided investing in education and training since 1870. The East India Company set up a college to educate and train future employees in 1806 ; why do not industries set up schools to educate and train British people? British companies and industry associations have failed to inform schools and universities what skills are needed and therefore imports immigrants because of shortages .

    Indeed, and this is crazy. My email box TODAY is filled with requests from recruiters about how they can get people with the skills I teach at university. What I teach, computer programming, is the skill in most demand which employers find most hard to recruit to. Yet my department has big problems recruiting applicants form schools. School-leavers with the right sort of skills don’t come to us. As someone once said to me “In my community, Computer Science is seen as a subject for thickies”. Schools see “Information Technology” as a subject to put the less intellectually able into, and see it as the right preparation for what I teach – which it is not, in fact it is almost useless and sometime even counter-productive. A-level Latin is a more useful preparation, because its study of grammar and representation and the way it queries assumptions about knowledge representation and makes you think carefully about use of language are all very useful things. A-level Maths is the best preparation, though more because it develops the right sort of approach to thinking than because we directly need much of what it teaches. But trying to get the schools to understand this is like banging your head against a brick wall.

    What I do find is that this constant push for kids to be “entrepreneurial” and the like is counter-productive. How it gets interpreted, wrongly, sure, but I tell you this is the case, is that you have to be pushy and aggressive and self-centred to get ahead. So we have a generation of kids who think the world revolves around them, and who think they have to strut around with airs and graces, and act like salesmen for themselves, and that’s how to move forward, and that’s how they’re taught to be. For most positions, being like that is useless. What it means is that kids can’t settle down and quietly get on with the work, and accept that strong mental discipline is what is actually needed to move forward. This is what I am being told by employers, that today’s youth have this big “attitude problem”, which means they won’t listen to what they are told, they won’t respect their seniors, they have no idea about things like good time-keeping, and they’ll just give up far too easily when things get hard/

  • @Matthew Huntbach I think we’re probably aligned here. Maybe. My view is that we should be shifting the burden of taxation from wealth creation towards accumulated wealth.

    Our problem is that as a party we’re rubbish at getting this message across – partly because taxing accumulated wealth is harder than taxing income (which is why income tax was introduced in the first place) – and partly because many in the party believe that taxing income, especially at higher rates and earnings, is in itself a Good Thing.

    if we were to be truly radical we’d look towards a sweeping simplification and rebalancing of the tax system away from taxing earnings and towards taxing assets. But you’ve got to have the carrot as well as the stick – along the lines of “well look, we’ve reduced income tax rates on higher earners!” whilst at the same time favouring business investment through the tax regime, eg through funding training and machine investment and disinsentivising non-business assets.

  • @Matthew Huntbach “What I do find is that this constant push for kids to be “entrepreneurial” and the like is counter-productive. How it gets interpreted, wrongly, sure, but I tell you this is the case, is that you have to be pushy and aggressive and self-centred to get ahead.”

    But who is interpreting it in this way? Being pushy, aggressive and self-centred is not entrepreneurial behaviour of itself. Having a belief in an idea and the drive to push it over obstacles (which may be nay-sayers) is. Fine line.

  • Matthew Huntbach 4th Jun '15 - 10:39am

    Charlie

    I would argue that a main problem is that British Industry has avoided investing in education and training since 1870.

    Yes, and what we see very strongly in Victorian Britain and later is the desire of those who succeed in industry to move on and become landed aristocrats. One generation makes its money through industry, the next buys a big house from the profits, lets the industry run down and makes its money from owning things.

    This is the Tory attitude all along, it’s what the Tories stood for in the 19th century and it’s what the Tories stand for now. That the best and the most noble money is that made from owning things and not doing things, and that money made from actual hands-on constructive work is somehow dirty money to be disdained. Now that attitude is why they react so strongly against things like property tax and inheritance tax. It’s not enterprise at all they are protecting, though they claim it is. It’s the idle rich, that always was what the Tories were about. Continuing reward for the efforts of your ancestors given to those who do not work for it themselves, because if that’s the sort of person you are, you are nobility, and you and your children have the right to lord it over everyone else.

    The point of property tax and inheritance tax is the idea that if you are wealthy you have a DUTY to use that wealth productively. So you should make sure that enough of your wealth is invested to make sure you have the income to pay those taxes. The taxes should be set at a level where this is not unrealistic to ask for. But I would say that if someone lives in a two-million pound house it’s not unfair to say that some of that wealth should be invested in funding entrepreneurs to build new business, and the returns used to pay a “mansion tax”. The wealth should not be left to rot. If you have bought the house for that money, you certainly have the wealth to put some in investment. If you have just had the house a long time and it wasn’t so valuable years ago, well, you have wealth that can be used as security for borrowing to fund investment. If you wish not to do any of this, then that is your right, but you should expect to see that wealth gradually reduced over time and generations. That is how to renew society, reward the enterprising, and make sure power and wealth does not end up all the hands of a hereditary idle class.

    That was the foundation of society in the past. and why historically taxes were on property and not income. It is, however, the opposite of the Tory way of thinking. We should not listen to their nonsense arguments when they claim otherwise. We should not kow-tow to them, as we see is happening with the New Labour revival in the Labour Party. No, we should question their assumptions and pull apart their sloppy arguments. Our political ancestors did that. If you look at some of the old Liberal attacks on the idle rich, it’ll make your hair stand on end, it’s the sort of stuff that the Tory press would denounce now as extreme left-wing attack on aspiration. But our political ancestors weren’t frit as we seem to be now. We should learn from them.

  • @Matthew Huntbach “What [being entrepreneurial] means is that kids can’t settle down and quietly get on with the work, and accept that strong mental discipline is what is actually needed to move forward. This is what I am being told by employers, that today’s youth have this big “attitude problem”, which means they won’t listen to what they are told, they won’t respect their seniors, they have no idea about things like good time-keeping, and they’ll just give up far too easily when things get hard.”

    I agree with the problem, Matthew, but I don’t agree with your diagnosis of the cause

    This is just symptomatic of a wider instant gratification cultural change within our society. And its certainly not helped by the school system. Children are just not made to knuckle down and learn things any more. We’ve lost that rigorous approach – it was thrown out in the 1970s.

  • Matthew Huntbach 4th Jun '15 - 10:48am

    Me

    Yet my department has big problems recruiting applicants from schools. School-leavers with the right sort of skills don’t come to us.

    It’s a class thing, you see. If you’re a doctor or a lawyer, you’re a lot higher up the class scale than if you’re an engineer. So that’s the academic subjects that the brightest kids are pushed towards – medicine if you’re good at science, law otherwise. We in science and engineering departments are left to scrabble for the also-rans, for those who did not get the grades to get into the posh subjects. You can see it so often – the Medicine department overwhelmed with A-grade applicants, the Engineering department in the same university having to make do with C-grade applicants, or facing closure because there just aren’t enough qualified school-leavers applying for their places.

    And having the calm and careful attitude and practice it takes to learn is NOT what is meant when we are told we must all become “entrepreneurs”. Oh, no, people who sit quietly and do maths and things like that are seen as losers, people with personality defects, people to be despised as “geeks” and so on.

  • Matthew Huntbach 4th Jun '15 - 10:55am

    We are told, we have it thumped into us, that being an “entrepreneur” means being a salesman. It’s not about carefully developing a good and useful product and service that people actually want. Oh no, it’s about managing to con people into parting money for rubbish. I understand there’s a popular television programme that works on this basis, and if it’s meant to be a parody that is so foolish that it undermines this idea by showing it up, no-one much seems to have seen it that way. If you want to know why Britain is failing, if you want to know why the Tories are leading us to economic disaster, look at things like that.

  • Little Jackie Paper 4th Jun '15 - 11:03am

    Matthew Huntbach – With respect (and to be clear I mean that), that’s not really a new problem though is it? I can remember in the early 1990s that both programming and IT (as distinct of course from Computer Science) were absolutely notorious for having far too many people doing courses that were, at best, mediocre, chasing far too little work. To this day the destination data for IT graduates makes ugly reading. Of course in computer science (something very different to IT or programming) there are severe shortages, likely global in nature. There have been large increases in the numbers taking A-Level maths in the past decade, and that is to be welcomed. But I do worry that in STEM in particular there is a real lack of understanding about career routes outside of the big, prestigious graduate programmes. Worse, not enough is done to talk about life outside the graduate schemes. I note in passing that I have found humanities graduates to be rather more hard-headed, but perhaps that’s just me.

    I do stress of course that these issues are wider than computer science/IT/programming. Engineering has some pretty ugly numbers too. Law is probably next, if it’s not seeing the problems already.

    There may well be problems in the education system, but those are not really new. Why they have not been really tackled is another question. But I do think that some people in industry have found it rather easy to start to point the finger rather than really take a long, hard look at the problems and how junior people enter the labour market. Immigration has just made these problems more visible.

    I would agree that there is perhaps a wider issue about how, ‘being entrepreneurial,’ seems to have become conflated with a particular mindset. Whilst I don’t think this is unique to the young but I suspect the young are more exposed. I’m not sure what the answer is necessarily but I do think that some industries and employers are not entirely helping themselves in how they project themselves. But, yes it’s complex.

    Just one other point – ‘Yet my department has big problems recruiting applicants form [sic] schools.’ Maybe, but are you somewhere that has particular problems? I don’t remember ever meeting you personally – where are you based? But anecdotally at least I’ve not heard about that issue in departments around the country – but again that’s perhaps just the circles I move in.

  • Little Jackie Paper 4th Jun '15 - 11:08am

    Matthew Huntbach – ‘It’s a class thing, you see. If you’re a doctor or a lawyer, you’re a lot higher up the class scale than if you’re an engineer. So that’s the academic subjects that the brightest kids are pushed towards – medicine if you’re good at science, law otherwise. We in science and engineering departments are left to scrabble for the also-rans, for those who did not get the grades to get into the posh subjects.’

    That has been trotted out for years. Medicine has always been the, ‘prestige subject.’

    However I think that this idea that has developed about science/engineering departments really has developed its own self-reinforcing mythology. It’s little better than a sort of victimhood. Things change. And to save you asking, no I have no evidence – it’s my own view.

  • Matthew Huntbach 4th Jun ’15 – 10:39am
    Wow, that was a thought provoking post. Thank you.

  • MatthewHuntbach
    Tell employers to follow the Royal Green Jackets recruitment system : this includes making sure the NCOs at Eton and Winchester CCF are from their regiment , some who would have served in the SAS. The RGJ are known as the Green Machine, they produce more generals per capita as any other other regiment and are only second to the Paras for entry to the SAS. The RGJ start to invite boys at the age of 13-14 to visit the regiment and consider a career with them( info from aristocratic etonian who was RGJ).

    You are correct about class and engineering and successful businessmen retiring to the country : Northcote Parkinson( work expands to fill the time available and his many books) and E Waugh in his novels( the brewocracy-whitbread, guiness, etc) mock these people.

    In France Lous XIV set up the Pont et Chaussee to train engineers and Napoleon the grand ecoles which recruited gentry to become officers . British manufacturers largely came from lower middle non-conformist background. The only officers who were trained as engineers came from Royal Military Academy Woolwich which trained Royal Artillery and Engineer officers from about 1741 to 1939 . RN officers needed high levels of maths and tended to be younger sons of aristocrats and poor gentry, farmers or clergy ( Nelson, Cook.)

    The dominant public schools of eton, harrow, winchester, charterhouse , westminster , shrewsbury may have produced pure scientists as they were gentlemen but rarely engineers. Rugby did educate sons of manufactures from the Midlands but endeavoured to turn them into gentlemen.

    What I think has further damaged engineering is the closure of grammar schools which produced most of our engin eers. During WW2, most of bomber command and about 40% of the pilots in fighter command were from grammar schools and of course 50% were killed. Those attending grammar schools were often the sons of craftsmen and engineers from local companies and the teachers who would have come Russell Gp universities would have known the parents. Many teachers from non- Russell Gp universities do not understand how maths higher maths is involved in engineering and still think it is a job for grease monkeys. Part of the problem engineering employs fewer but far more highly skilled and well paid work often in clusters located in certain parts of the country, such as Newbury, N cambridge, surrey and therefore inner city, rural and many suburban areas often lack people with these skills. It would appear that engineering is appealing more those at public and grammar schools, partly because they can become Quants in The City.

  • Matthew Huntbach 4th Jun '15 - 8:22pm

    Little Jackie Paper

    Just one other point – ‘Yet my department has big problems recruiting applicants form [sic] schools.’ Maybe, but are you somewhere that has particular problems? I don’t remember ever meeting you personally – where are you based?

    Queen Mary University of London. Recruitment has improved in recent years, at least for Computer Science, though we’re in a joint department with Electronic Engineering and they find it really hard, in part because they absolutely do need A-level Maths, whereas we in CS can get by without it, though we’d prefer it if they had it. There just aren’t enough school-kids doing A-level Maths. If we made it an absolute requirement for a degree in CS to have A-level Maths, we wouldn’t be able to fill anywhere near all our places, and half of us would lose our jobs as a result.

    While I wouldn’t deny there are particular issues with QMUL (always everyone’s fourth choice in London after Imperial, UCL and KCL) recruitment in CS departments countrywide has been a big problem. School-leavers who have the right skills and attitudes tend not even to think of it, and too many of the applicants we get just don’t have the right skills and attitudes due to this confusion of CS with what schools call “IT”. When I was admissions tutor for my department I used to get hundreds, yes, literally hundreds, of UCAS applications who got rejected in seconds because of lack of necessary qualifications and obvious unsuitability, in particular not even a grade C in GCSE Maths. Yet the schools would write UCAS references for them telling us how wonderfully suited they were for our subject in a way that clearly revealed the deep ignorance of who was writing the reference.

  • Matthew Huntbach 4th Jun '15 - 8:25pm

    Charlie

    What I think has further damaged engineering is the closure of grammar schools which produced most of our engineers.

    Well you are wrong. The problem is not with those who would have gone to grammar schools, it’s with those you want to dismiss to secondary moderns. We just don’t live in an age where 80% of people do manual work and 20% do brain work, so your idea that re-introducing a school system based on that division will help is bonkers.

  • Matthew Huntbach 4th Jun '15 - 8:41pm

    Little Jackie Paper

    Of course in computer science (something very different to IT or programming)

    Er, no. While Computer Science is about more than programming, programming is the core topic, and in a sense everything else hangs off it. You are very wrong when you say that Computer Science is “very different to programming”. And actually programming IS the skill in most demand which recruiters find most difficult to recruit to. See the Tech City Report. So this idea you are pushing out that there aren’t jobs for people with the skills I teach is wrong, and HUGEKY DAMAGING. Yet, you are not the only one, there does seem to be quite a common misbelief in schools along these lines.

    In part it’s to do with the growth of Agile. The old idea that programming would all be outsourced to cheapo third-world companies stemmed from the discredited Waterfall approach. No-one does it that any more.

  • Little Jackie Paper 4th Jun '15 - 8:49pm

    Matthew Huntbach – Thank you. I have to admit that I am a bit surprised that you are having trouble recruiting, albeit perhaps there is a wider issue there with London HE institutions. I certainly wouldn’t want to be a London undergraduate today. That said, given the large increases in numbers doing A-Level maths I am a bit surprised by your comment. Maybe I just move in different circles! But I have heard anecdote (for what that’s worth) that is somewhat more positive than your take on the current situation.

    The Computer Science/IT distinction is unfortunate although not new. It’s about the equivalent of conflating mathematical science with numeracy. I certainly share your frustrations with the way the two get conflated by schools. I’m not totally sure what the answer to that is, but it is an issue in need of resolution. Probably demanding A-Level maths is part of the answer, though of course that’s not an option for everyone.

  • Little Jackie Paper 4th Jun '15 - 8:55pm

    Matthew Huntbach – Thanks for the report, I hadn’t come across that and I’ll add it to my pile.

    ‘So this idea you are pushing out that there aren’t jobs for people with the skills I teach is wrong, and HUGEKY [sic] DAMAGING’

    No – what I said, obviously not clearly enough was that there are complexities in the labour market that are not fully understood in common discussion. Not everyone gets on the high-powered ultra competitive graduate programme and many people have to look at life outside them. What I said was I feel that too often those other routes are not given sufficient attention or explained (still less promoted) well enough. Whatever value judgment I make on both the unemployment numbers and the labour market situation I think that those on courses should at least be aware of the facts. I didn’t think that would be especially controversial

  • Matthew Huntbach

    Approximately 25% went to grammar schools and and 7 % went to public schools. Those teachers at public and grammar school mostly went to Russell Gp universities. Sec’Mod teachers mostly had Cert’ Ed qualifications ( 2 years ) as they only taught up to O Level. The teaching unions wanted all teachers to be graduates , so the Cert’ Ed was extended from 2 to 3 years to produce B.Ed but the academic standard was hardly increased. Many teachers at grammar schools when they became comprehensives, left for public or remaining grammar schools. The consequence is that most Sec’Mods or newly created comprehensives never had enough Russell Gp teachers to educate pupils to high enough standard in all A Levels in order to enter top universities. What can happen is that there may good chemistry, biology and physics teachers but poor maths teachers or good english and history teachers but poor language teachers.

    When one looks at many grammar schools , when they become comprehensives, less pupils end up at top universities.
    A major problem was the decline in discipline and aspiration. As a former Head of a f Sec’Mod and Comprehensive said to me ” When 25% of a class or school are troublemakers, one is not involved in education but riot control!” Parents at grammar school are almost 100% aspirational and supportive of education, at comprehensives up to 40% of parents are indifferent or even antagonistic to scholarship. Educating Rita demonstrates the antagonistic attitude of some people to education. As one lady who came from a poor background who went to a grammar school said ” What grammar school offered was a refuge from the working class nihilistic attitude to education.” At the comprehensive I attended , which was former Sec’Mod , when trouble makers left as soon they turned 16 , many teachers were relieved as it allowed them to teach children who wanted to learn.

    The idea of selecting on academic ability takes place most in most Northern European countries and they have tripartite systems which are similar to the Grammar , Technical High and Sec’Mod system of Britain- Germany and Netherlands are good examples.

  • Matthew Huntbach 4th Jun ’15 – 8:25pm

    Matthew you are correct, Charlie is most definitely wrong in his romantic notions about Grammar Schools and engineering.

    When I was a grammar school boy in the 1960s the intellectual snobbery of most of the teaching staff towards anything so “grubby”as engineering was clearly and openly stated. The school careers advice was that if you could only get a couple of A-levels with poor grades ŷou could “always do engineering, I suppose”. It was seen as the easy route into university for the thick or the lazy.

    I am sorry if this eye-witness account will distress Charlie and others whose view of such schools has more to do with nostalgia and perhaps dissatisfaction with their own schooling. A very accurate picture of state grammar schools is given in the Alan Bennett play/film ‘The History Boys’. The clue is in the title – it is not called ‘The Engineering Boys’.

  • Alain Desmier 5th Jun '15 - 8:18am

    @Matthew Huntbach

    “Oh, no, people who sit quietly and do maths and things like that are seen as losers, people with personality defects, people to be despised as “geeks” and so on”

    Developers, Financial controllers and Business Intelligence staff are generally the most prized and expensive hires an internet business makes. In my experience of working in and running such businesses over the last ten years, they are the hardest to recruit, earn the best salaries and have the widest pick of jobs.

  • One thing that was very unfavourable to micro and small business was first the rigged postal market followed by the sell-off of Royal Mail. Costs for sending out individual parcels have rocketed while the big boys like Amazon can command huge bulk discounts from the private mail companies. Then these mail companies are allowed to take advantage of the Royal Mail universal delivery to extend their business into rural areas. It is all very monopolistic.

    Microbusinesses provide flexible employment for parents and carers working from home, and many of them are mail order. Liberal Democrats should be helping these businesses rather than monopolistic, tax-avoiding Amazon.

    There is too much emphasis on perpetual growth of business in the capitalist economy. I agree that thrusting entrepreneurs have a big place in society, but many people run micro-businesses just to survive, and are not interested in growing them in order to become rich. We should respect and support these people by making it as easy as possible for them.

  • Matthew Huntbach 5th Jun '15 - 9:51am

    Alain Desmier

    Developers, Financial controllers and Business Intelligence staff are generally the most prized and expensive hires an internet business makes.

    Oh sure, but that’s what I’m saying myself. The point I’m making is that the image of the “entrepreneur” as a greedy, narcissistic, loud-mouthed person who gets where they want by a domineering personality which is often out across isn’t helping with this. Putting out the idea that the main thing stopping entrepreneurs from being entrepreneurial is tax on the big houses they expect to get from doing this contributes to this misconception.

  • Matthew Huntbach 5th Jun '15 - 9:54am

    Charlie

    A major problem was the decline in discipline and aspiration. As a former Head of a f Sec’Mod and Comprehensive said to me ” When 25% of a class or school are troublemakers, one is not involved in education but riot control!”

    Oh sure, but snatching away a small proportion of the population while leaving the rest to suffer from this isn’t helping.

    You just haven’t got my point. The problem in this country just ISN’T with those who would have gone to grammar school. It’s with the rest. Your line “concentrate on those at the top and ignore the rest” just isn’t going to help with that.

  • Matthew Huntbach 5th Jun '15 - 10:01am

    Charlie

    The consequence is that most Sec’Mods or newly created comprehensives never had enough Russell Gp teachers to educate pupils to high enough standard in all A Levels in order to enter top universities.

    Yes, and they never will. It’s like me and school leavers with A-level Maths, there just aren’t enough to go round. People with a good degree in a high demand subject just aren’t going to go into school teaching, or at least not in enough numbers so that all schools can have a few of them. I write a lot of references for the students I teach, either going into jobs or into further study. I can count the number who have asked me for a reference to go into teacher training on the fingers of one hand – and almost universally those who go for that option are those who got a poor degree result. I don’t think I’ve ever had anyone in 25 years of doing this who has a 2i and wants to go into school teaching.

    More could be persuaded to go down that route if teachers’ pay were higher, I suppose. But that would require more tax, which would be denounced as “an attack on aspiration”, “the politics of envy” and all that stuff.

  • A factual note on those who attended Grammar Schools courtesy of The Daily Telegraph Obits —
    http://www.telegraph.co.uk/news/obituaries/10919584/Felix-Dennis-obituary.html

    Felix Dennis was a couple of years above me at Surbiton County Grammar School.
    Someone who started various small businesses that grew into phenomenally successful large businesses.
    Not exactly the pen picture of the studious, scholarly grammar school success painted by Charlie and TCO but someone who did much more for the UK economy than a brigade of engineers. 🙂

  • Matthew Huntbach 5th Jun '15 - 10:18am

    Little Jackie Paper

    I certainly wouldn’t want to be a London undergraduate today.

    When I was growing up in Sussex it was considered normal to go to London for university – far enough away from home to have to stay there (which is a very valuable part of being a university student), close enough to be able to come home when you want. Now I find it impossible to recruit from the Home Counties, or anywhere else in the UK outside London – we have almost no students who are UK origin and living in student accommodation. Our students are either from London and staying on living with their parents or from overseas.

    Of course back then, Queen Mary in Mile End was thought to be in a very bad location when it was still the old East End. But now, well, look one way and there’s the City of London as it always was. Look the other way and what was desolation is now Canary Wharf. Turn around and look in another direction that was more grotty old decay when I was young, and it’s now Tech City or Silicon Roundabout or whatever you call it. We’re now in the middle of it all. It’s still hard to get kids and their teachers from outside London to see that.

  • Matthew Huntbach 5th Jun '15 - 10:22am

    Little Jackie Paper

    Probably demanding A-Level maths is part of the answer, though of course that’s not an option for everyone.

    It’s not an option for anyone outside Imperial and UCL. As I said, there just aren’t enough school-leavers with A-level Maths. If I had demanded A-level Maths when I was admissions tutor and rejected any applicants who didn’t have it, our department would have been left half empty, or at the nadir of recruitment after the dot-com crash, three-quarters empty, and it would have been closed down and I and most of my colleagues would have lost our job. Civil Engineering and Chemistry WERE closed down because of lack of recruits, so that’s not exaggeration

  • Matthew Huntbach 5th Jun '15 - 10:39am

    Charlie

    The idea of selecting on academic ability takes place most in most Northern European countries and they have tripartite systems which are similar to the Grammar , Technical High and Sec’Mod system of Britain- Germany and Netherlands are good examples.

    So why do you talk exclusively about grammar schools? If you had put the argument that Secondary Modern schools were good for those who went there, that they learnt better with the most academically-minded kids being removed, you might make your point better. But you don’t. You only ever mention grammar schools, and treat the schools most children would go to under you ideal as like dustbins they are thrown away into.

    I’m not opposed to streaming within schools, and in fact you’ll find this is almost universal now. Some of the criticism of comprehensive schools seems to be based on the idea that it’s standard not to have streaming. I don’t think I know of any comprehensive school now that operates that way.

    There are problems with social attitudes, sure, which is one of the things I’m hinting at when we have a culture which pushes the idea that to be successful you have to be greedy, loud-mouthed and domineering. There is just perhaps an issue that what works to get you forward in certain rarified professions does the opposite in most professions, and our culture is too dominated by people from those rarified professions.

    So, I don’t think the problems you are mentioning are just to do with comprehensive schools, and I think suggesting “bring back the grammar school” is avoiding dealing with them rather than tackling them head-on. Anyway, the scientific experiment to prove your point or not is there. Some places, including the whole of the administrative county of Kent, never abolished the selective school system. Therefore, if you want to prove your point, just go to Kent and see if it works out like you say it would. Is Kent doing well economically, no social division, everyone getting good jobs? Are top positions in the UK filled with people from working class backgrounds who grew up in Kent and so had the benefits you claim selective education provides?

  • Matthew Huntbach 5th Jun '15 - 10:53am

    Little Jackie Paper

    No – what I said, obviously not clearly enough was that there are complexities in the labour market that are not fully understood in common discussion.

    The line “But there are no jobs in what you teach”, which is still often thrown at me, is a big barrier to recruitment.

    Part of the problem is that computer programming is notorious as a subject which some get and do well, but many people start, just can’t get to grips with it and do badly. I routinely fail 40% of the students who take my module – which is why employers are knocking at my door asking for the names of students who did well in it because I can guarantee they have the skills. But what I do isn’t liked, I don’t get good student feedback, it pulls us down the League Tables and I am under pressure to dumb down and so reduce the failure rate. I could easily do that: stop assessing them on actual programming skills, instead have assessments which are all multiple choice questions, memorisation of definitions, and any actual programming done as coursework (with a blind eye turned to the reality that this always leads to mass plagiarism). Well, if I did that, I couldn’t give the guarantee I can give now to employers.

    I have to exercise a bit of professional courtesy here, but let’s just say a lot of universities when it comes to teaching what I teach don’t assess it as I do. That has a knock-on effect on the reputation of Computer Science degrees, and contributes to why it is possible to have what looks like a reasonable qualification in a high demand subject and yet not be able get a job.

  • matt (Bristol) 5th Jun '15 - 10:53am

    To comment tangentially on Matthew and Jackie’s discussion about perceptions of London, lived in Berkshire as a child, studied in Yorkshire, and then moved to the borders of Northamptonshire for my first job. I spent most of the first five years of my working career considering and then rejecting opportunities to move to London (this is in the 2000s) as the cost of living, the idea of the ‘rat race’, the sheer urbanness of a global city, were all a massive turnoff for me. London feels like it is on a nother planet to me and I got fed up very quickly of living even in its outer commuter belt as its effect is to suck the life out of smaller regional towns.

    With even more uncertainty about cost of living, house and rent prices, income, job security etc over the last 5-7years, I’m not surprised many people don’t want to study there, for all its opportunities and perceived glamour. I’m sorry Jeremy Brown, but faced with a mental image of an epic Darwinian survival of the fittest battle to be one of the global elite in a context of teeming millions at the cutting edge of business and technology, or living somewhere where I know my neighbours, know where my wage is coming from and when its coming, and feel in control of my life, I know which one I’d choose.

    I may be wrong (I often am), but ‘move to London’ meant ‘be absorbed into an enormous soul-sapping machine’. I don’t think I’m alone.

  • Helen Tedcastle 5th Jun '15 - 11:02am

    @ TCO
    ‘ This is just symptomatic of a wider instant gratification cultural change within our society. And its certainly not helped by the school system. Children are just not made to knuckle down and learn things any more. We’ve lost that rigorous approach – it was thrown out in the 1970s.’

    Having taught in comprehensives for fifteen years I can inform you that this is certainly not the case. Most students work hard, many very hard – much harder than my generation,

    I find it so sad that older generations constantly denigrate young people when they have so much to offer, work so hard and negotiate daily a consumerist society which bombards them with images and paradigms of ‘achievement’ and self-gratification which, without sound parental guidance, are very difficult to navigate through clearly.

    Bringing back selective education as we had in my youth, will also bring back secondary moderns and a sense of inadequacy for many at the expense of a select few. I am proud that my nephew has learned so much and taken part in so many activities at his comprehensive – the teachers have done a fine job. His school streams – as they do almost universally and have done for decades – and I started teaching in streamed classes in 1989!

    What we need to change are the relentlessly negative attitudes put forward by members of my own generation (1970s-80s educated) who think that something was lost when the grammar system went.

    I put this down to the fact that my generation witnessed a great deal of restructuring and heard as I did off the cuff lamentations by ex-grammar teachers forced to teach non-selective pupils in my sixth form college. It all rubs off. On me it had the opposite effect.

    No. With the closure of the secondary moderns and grammars something was gained – good sound education for the many rather than the few highly academic achievers catapulted out of their station.

  • Matthew Huntbach
    The 1944 Education Act designed a tripartite system such as N Europe but hardly any technical Schools were created which was the problem. Also phonic teaching , setting, streaming, competitive sports and much discipline went out with the comprehensives and many became too large too manage. Eton, overcomes the problem with size, 1200 pupils by having houses. The child centred style of education with multi ability classes was a result of A S Neill and the introduction of ideas from American education which did not happen in N Europe where the tripartite system remained and there also many roman catholic schools. .
    France has the lycee system which children enter at 15 is sub-divided into general, technological and professional (vocational )
    http://en.wikipedia.org/wiki/Secondary_education_in_France

    Europe divides it’s education into 3 steams at ages from 11 to 15. Hardly any country has comprehensives which are meant to be teach everything and at all levels of ability.

    JohnTilley
    Surbiton is not famous for it’s engineering and applied science .
    The routes for educating Chartered Engineers were as follows.. Engineers at universities used to be a large part of the sports clubs, especially rugby.
    1. Leave school, usually grammar and become apprenticed . Study at night school for Council of Engineering Exams Part1 ( HND) or Part 2 ( degree). Inst of Mech Eng was considered tougher than most degrees. This why many engineers do not have B.Sc after their name but MICE or MIME or MIEE , C.Eng.
    2. Enter Armed Forces schools of engineering and go up to Cambridge for 2 year degree.
    3. Read engineering at university and then join organisation which then trains one to become charted which takes 5-7 years after graduation.

    Grammar schools started to move away from a totally classical education in the mid 19C because most of parents were of pupils were middle classes employed in business. Most engineer educated to HND and above until the mid 1970s came from grammar and a few public schoolsl- check their biographies.Skempton, Mitchell, Wallis , Chadwick

    JohnTilley from what background did chartered engineers come from ? You are saying they did not come from grammar or public schools, so where and how were they educated? One author who has examined the anatomy of britain was A Sampson ( a founder of the SDP) in his 62,.65,82 and 12 books because he was interested in which organisations ran Britain and where did those people who run them, come from.

    My experience of industry was that many comprehensive pupils failed to get into Cambridge/IC and flourish there because they did not receive a rigorous enough education from a young enough age. At the top universities there are not only people with straight grade As but also have played u19 for their country!. The reality is that maths, engineering and physical science at Cambridge/IC require a standard of maths such that pupils can sit the O level /IGSE at 14-15 and it sit single science IGSCEs .

    Countries such as the USSR used to have special schools for bright children. If we look at top public schools their catchment is the whole world: it is unrealistic that every inner comp offers high quality education. How many primary schools offer French, Latin and Greek ?What I think is required are academically rigorous schools in each borough or one per several boroughs. An example is the new maths school at King’s, London.
    http://www.kcl.ac.uk/mathsschool/home.aspx
    Unless one has specialised schools how are state pupils going to compete with those schools such as Pilgrims School Winchester?
    http://www.thepilgrims-school.co.uk/Mathematics
    http://www.thepilgrims-school.co.uk/Classics
    The advantage of learning Latin and Greek is it helps learn other languages, that is why Britons were able to learn Sanskrit, Urdu etc, etc.
    gaudium discendi – the joy of learning.

  • Matthew Huntbach 6th Jun '15 - 8:17am

    Charlie

    Europe divides it’s education

    That should be its. One should only use it’s when it’s short for it is. Otherwise its correct spelling does not have the apostrophe. I am always having to point out that one to my students as it’s a very common mistake. They don’t like it when I do so, but I do have to keep pointing out that they will always be held back in life if they use poor grammar, and I’m probably the last one who will ever tell them that and try to get them to overcome common mistakes like this. I just hope I’m not the first one …

    My experience of industry was that many comprehensive pupils failed to get into Cambridge/IC and flourish there because they did not receive a rigorous enough education from a young enough age.

    Actually it tends to be the other way round. Those from less exclusive backgrounds tend to do better when they get to the top universities. I went to IC after having gone to a comprehensive school, your idea that no-one from comprehensive schools gets good grades and goes to top universities is wrong.

  • Matthew Huntbach 6th Jun '15 - 8:21am

    Charlie

    The advantage of learning Latin and Greek is it helps learn other languages, that is why Britons were able to learn Sanskrit, Urdu etc, etc.

    That’s not the only advantage. These languages tend to be studied in a formal grammatical way, and that is good training to understand things like knowledge representation and be more thoughtful about precision in one’s own language and in use of rule systems in general. When I was admissions tutor for Computer Science if I got an applicant with a good grade in Latin, I’d accept immediately almost regardless of other qualifications for that reason – and they always did well.

  • Matthew Huntbach 6th Jun '15 - 8:41am

    matt (Bristol)

    With even more uncertainty about cost of living, house and rent prices, income, job security etc over the last 5-7years, I’m not surprised many people don’t want to study there, for all its opportunities and perceived glamour.

    Well, I think you illustrate the problem – you don’t know what it’s like, but you think you won’t like it so you don’t want to try.

    It’s a learning experience. Coming to London at the age of 17 to be a university student helped me enormously to grow up. I do think if kids stay at home and don’t go away to university they stay childish into their twenties, I’ve seen too much of that. We used to have National Service which also was a growing up thing. Charlie, I suspect, would like me mentioning that, I’m not saying I’d like to see it brought back in the old form, but some sort of way to get kids out of the home environment other than going to university could be good.

    But young people seem to be more childish these days anyway. Back when I went to university it wasn’t considered such a scary thing, after all I’d walked to school a mile and a half away from home on my own since the age of 5. Nowadays it seems most kids are mollycoddled, and hence this idea that going away especially to London is just too scary to do.

    Studying in London doesn’t mean you have to stay there afterwards. I did, my sisters who also went to university in London came back to Sussex afterwards and stayed back in Sussex. If you come to a London university from outside, you’ll get a year in university accommodation, and that will help you get into living there, and may be in a place you won’t get a chance to live in again. The experience of living in central London within walking distance of major sights was a good one, I’m not ever going to be able to afford to live in South Kensington again, now I live in a boring suburb which isn’t that much different from life in the bigger towns in Sussex.

  • Matthew Huntbach
    I have never said look at the top 25% and ignore the rest. What I have said is that the breadth of ability is such that it is unrealistic to teach all subjects to all levels in the same school: that is why most countries in continental Europe have some sort of tripartite system. A Tripartite system was proposed in the Butler Education act. Also , I think selecting pupils/streaming them at 10-11 is too young whereas at British boys public schools and most Continental counties, this is done at 13-15 years of age which is more sensible.

    What I have said about comprehensives is that few offer across the board teaching of the highest standards and that is why many talented pupils do not get into top universities. Islington schools did not offer single science GSCEs and only 60% of comprehensives offered Further Maths A level : how is it that these situations do not disadvantage those at comprehensives? Many public and grammar schools now offer IGSCEs, Ib and Cambridge Pre-U which all offer advantages to bright pupils. What I think would help make better use of teachers from Russell Gp universities is the introduction of 6 th forms. Pupils should be able to take their GSCEs early and move onto the 6 th form. I just met a lady who went up to Oxford to read English and she started her history A level at 14; she said she skipped her O Level.

    Many have said that that one of the unplanned side effects of the Ed’Maintenance Allowance was that trouble makers ended up staying on the 6th form which was detrimental to those wanting to study. Also, I would like students to flourish at university, this mean study but also excel at sports, theatre, music etc .

    The reality is that many comprehensives are in fact more less Sec’Mods, unless they were former grammar schools , especially within inner city areas. My concern is that bright children in many comprehensives are not receiving the same sort of teaching that those at public and grammar school receives which puts them at a disadvantage . Also, many less able children struggle with GSCEs and from about 14 years of age want to leave school and undertake some sort of craft training which interests them far more: which is what the h tripartite system in Germany and Netherlands provides. This is why Germany and the Netherlands produce far more literate, numerate and skilled tradesmen than we do in Britain. What took a 16 year old Briton 2 years to learn under the old YTS system , Germans learnt in 6 months.

    If the 1944 Butler Act had been introduced with a tripartite system, I think we would have an education very much like the German which produces large numbers of highly skilled craftsmen ( many educated to ONC technician level), technicians, applied scientists and engineers. Consequently, a large high value technologically advanced manufacturing and industrial economy can be created and supported.

  • Speaking as someone whose first degree was a first in electrical engineering, if anyone had told me while I was at school how much doctors got paid, I would have thought hard about picking medicine instead. It’s not all about the money – but when the difference is that big, you need a good reason not to take it into account.

    Engineering has issues as a profession, part of which is the lack of mentoring and development of graduate engineers. The career path too often involves switching jobs every couple of years to more interesting projects, and turning out solid defensive design work wont’ get you the notice and promotions that flashy self promotion will (this is true in many areas but in engineering it is endemic, which is one of the reasons that women don’t really tend to stay). Engineering has an alpha male problem, and little sign of that changing any time soon.

  • There are many many good comprehensive schools where pupils have an excellent chance of going to a good university (maybe not Oxbridge, relative to independent and grammar schools). As a comment, I would add that the GCSE league tables have led schools to focus on converting B to C grades rather than B to A grades… This was not good for my own children, who underperformed at GCSE and A-level compared to KS 1-3.

    The problem is that in Leeds (where I lived for the last 30 years), these schools are all in the leafy suburbs of outer Leeds. Middle class parents have bought this good education by moving into the catchment areas (or converting to Catholicism, in some cases!). There is one inner city comprehensive in Leeds with an average grade at GCSE of F!

    My ex-wife was a supply teacher for several years. It was these inner city schools where she was inevitably sent, because so many teachers were on long term sick leave or simply could not be replaced. She had left school herself with no 15+ qualifications and done English at University as a mature student – but as a supply teacher she “taught” French, Maths, Geography, RE and any other subjects you might name. She said she considered it an achievement if she got the kids to sit still and pay attention for 15 minutes in an hour… Yet she said they were not stupid, just badly socialised and failed by the system and the demoralised teaching staff, with no-one giving them any aspiration beyond the supermarket checkout or the call-centre.

    The grammar school system did at least enable a very few bright children a chance to break out of their neighbourhoods. Grammar schools did also give (in my opinion) a better chance to the highest attainers – simply by giving critical mass. (and the high attainers are important for this country and now overwhelmingly to be found in the private sector). There should have been a higher proportion of grammar schools and the secondary moderns should have been technical schools giving a different sort of education. And there should have been more chances to transfer in both directions. But then as now, most poor children were failed by the system, because once you get a critical mass of disruptive pupils (because of their home backgrounds), education becomes next to impossible. There are of course examples where particular headteachers have managed to overcome these problems, but it requires a very pro-active approach with parents and carefully chosen teaching staff (usually only possible in special measures). Teachers in these schools need to be exceptional, not merely competent.

    The other effect of comprehensive schools, generally ignored, has been demographic. House prices have been relentlessly pushed up in the catchment areas of the “best” schools, and social divisions have increased. This may well have made some of the inner Leeds comprehensive schools worse than the secondary moderns that preceded them. The idea of moving house for education reasons did not exist to the same extent as now.

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