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Brits Budget

alexa

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The Budget build up is on BB2, hard choice with Wimbledon on BBC1,

Anyway, the 'we're all sharing the pain' and 'my pain has to be the same as your pain' propaganda has begun to bore already.

The rich are apparently going to pay more than the poor :shock: one would certainly expect that.

Well with opening talking of cutting 'meals on wheels' to the elderly and cutting unemployment which is already too little for people to live on, should be interesting.

I will only watch till Andy comes on court....but I am interested.

1. Unemployment to peak this year at 8.1%

2. 77% of money needed to be got by spending cuts.

3. Not joining the Euro in this Parliament

Putting into private hands things like student loan books
 
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alexa

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Welfare Reform


Benefits, Pensions, Tax Credits will rise with consumer prices (I think that is with the exception of the State Pension and Pension Credit)

massive stop in one off benefit.

Child benefit still for all but frozen for the next 3 years.

Disability Living allowance will stay but new medical with the intention of getting masses off it.

Housing Benefits - maximum limit of $400 a week

Lower taxes for businesses

2 year wage rise freeze of Public sector jobs earning under £21,000 (under $21,000 get £250 rise per year)

Next year VAT up from 17and a half per cent to 20 per cent. Looks like this is the major tax rise and will without question hurt the poor more.

In England help to freeze council tax for one year (conditions apply)

Capital Gains tax rate of 28% for top earners from midnight.

Personal Tax allowance up by £1000 from April

From next year re link State Pension with earnings

Increase child tax credit by £150 above indexation (whatever that is!)

That is it!
 
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alexa

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Hariot Harman has given an excellent reply, saying that what the Chancellor has said is rewriting history, that there is no need for these massive cuts, that what Labour was doing was working and would have reduced the deficit earlier and that this likely will stop our recovery.
 

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Increase child tax credit by £150 above indexation (whatever that is!)
Indexation means that an expenditure is pegged to some index. Usually, "indexation" refers to pegging something to inflation or wages. Hence, if an item is indexed to inflation, its value rises at the rate inflation increases (so that in real terms, its purchasing power remains unchanged). If an expenditure were kept unchanged, inflation would reduce its purchasing power over time. Therefore, "£150 above indexation" means that the child care tax credit would be increased by £150 more than what would have been the case under indexing.
 

donsutherland1

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For those who are interested, the UK's budget documents can be found at: June Budget documents - HM Treasury

For a time, one might want to use the "easy-to-browse" version and also individual chapters. Almost certainly due to website traffic, attempting to retrieve the entire budget document is a slow process.
 

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I like the sound of a medical to qualify for Disabilty Allowance. It may not be much but it can easily be scammed. All too often scroungers get found out:

Window cleaner pocketed £71,500 in benefits by claiming he was too scared to go out... and is still doing his round | Mail Online


Too many people can take from the pot now. Things are so screwed up that even working people have relied on tax credits and benefits now. (Not that tax could be cut when it still could, oh no, you have to have Sky TV for jailed criminals, a multi-million-Pound-per-day EU bill, armies of useless government jobsworths and 83% of your petrol money being raked in by the Exchequer.....)

But as I say, if they want cuts then they should slash the bloated 'foreign aid' gifts budget rather than put criminals on the street. And Harridan Harman has a nerve talking about 'rewriting history' - Labour did nothing but! Tessa Jowell refused to launch an enquiry into the July 7 bombings for 'community relations'. They even set up a museum exhibition, post 7-7, claiming Islam gave us things like ice cream and make up for example - products of the Romans and Ancient Chinese.

And back to finance, if Labour hadn't totally ruined the economy with reckless tax and spend before causing unemployment to skyrocket for various reasons then old Harridan may have a point.
 
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alexa

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I like the sound of a medical to qualify for Disabilty Allowance. It may not be much but it can easily be scammed. All too often scroungers get found out:
We have been having these anyway for incapacity benefit. Yes, sure there are people who will try and use the system but as you say all to often scroungers are found out. We had a program on this in Scotland, I don't think it was shown in England. All to often people are being told at medicals they are fit for work when they are not. The most extreme example being a woman who was told she was fit for work and was dead just a few months later.

There is an enormous amount of appeals which are being won. For the woman above too late because she was dead. I don't have the statistics at hand but the no of appeals which are being won far exceeds what statistically should be the number of mistakes. The onus is on the person doing the medical to basically try and say they are well rather than objectively looking at the situation.

Additionally as the 'medical' is not really a medical a lot can be missed, like the late stages of cancer in the woman above.

However to the best of my knowledge that red haired liberal with the glasses who I think is looking into this for the Government and whose name escapes me, was I think the person for Scotland who was concerned about this and going to look into it anyway so hopefully a balance can be found to avoid what we saw in this film happening to the most vulnerable.

While you may want to find the odd scrounger, most people on disability benefit will be disabled and it is extremely stressful for them to be put through the medical and if they are unwell told they are fit to work. I will be keeping a keen eye on this. I guess most of the 'scroungers' will be people who were originally ill and failed to report their recovery.
 
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Infinite Chaos

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Hariot Harman has given an excellent reply, saying that what the Chancellor has said is rewriting history, that there is no need for these massive cuts, that what Labour was doing was working and would have reduced the deficit earlier and that this likely will stop our recovery.
Most of the pre budget independent pundits pointed out that Labour didn't rule out exactly the same measures next year to pay back this huge deficit. The only real difference is that the Conservatives said they'd do this now - not wait a year.

I have to say Harriet Harman was good today in her response - where however was her ire when Gordon Brown and Tony Blair were in power? (It's always easy to be open and honest when in opposition)
 

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Most of the pre budget independent pundits pointed out that Labour didn't rule out exactly the same measures next year to pay back this huge deficit. The only real difference is that the Conservatives said they'd do this now - not wait a year.
That year appears to be the important thing. However we can imagine Labour would have juggled things somewhat differently as indeed would have been the case if the Conservatives were not in a coalition.

I have to say Harriet Harman was good today in her response - where however was her ire when Gordon Brown and Tony Blair were in power? (It's always easy to be open and honest when in opposition)
Yes, she was good. I don't think she said anything different to what she has said before or what is new. Now is not the time for cuts. The cuts are far more than was said in the election manifesto. VAT hurts the poorest most. I think that is what she believed before and what has changed in the Conservative approach.

I do have concerns about all people on disability living allowance facing a medical. This is because of previous outcomes doing this with incapacity. The number apparently who were deemed well was around double the governments hopes, maybe even more, but that wasn't the truth. I think Cameron is not stupid. The man who is in charge of this, if I am not mistaken, would probably have been the biggest thorn in the side of whoever else was in charge. ;)

It is also interesting how 'welfare scroungers' are always top of the news and money being put in to find them, when tax evaders who cost the country far more money, rarely get mentioned and sought.

One of things which could have been done was close some loopholes for people evading tax.

Now as to the rich being hit hardest. The second richest group in society is being hit the hardest but after that it is the poorest. That gave Vince Cable a red face. He wondered how it could be and said pensioners were looked after -well were the poorest pensioners looked after, those relying on the State pension. I am not sure now is the time to change how that gets risen from rise in prices to wage rises. Even seems some people may be taking pay cuts so that might mean the state pension is cut. :shock:

I guess the other reason the poor will be hit the second most will be those on benefits.
 
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Infinite Chaos

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It is also interesting how 'welfare scroungers' are always top of the news and money being put in to find them, when tax evaders who cost the country far more money, rarely get mentioned and sought.
Tax evaders had a pretty light time under Labour - all parties should clamp down on opportunities to evade tax.

-- Now as to the rich being hit hardest. The second richest group in society is being hit the hardest but after that it is the poorest --
The way I'm seeing it is that in some areas the richest will be hit hardest by tax increases and in others yes it's the poorest who will suffer under the VAT rise.

BBC News - Budget: The impact on people and households

BBC News - Budget analysis: The bus shelter Budget
 

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Now is not the time for cuts. The cuts are far more than was said in the election manifesto. VAT hurts the poorest most. I think that is what she believed before and what has changed in the Conservative approach.
Alexa,

It should be noted that the budget plan announced concerns a five-year timeframe. All the cuts and tax hikes will not occur immediately.

Apparently, given its references to Greece, the UK government believed that there was a sense of urgency to preempt market developments that might spark concerns about a debt crisis that, in turn, would require more and more austerity to try to fend it off. Market psychology can be extremely fickle. Markets can go to excess. They can become irrational. The UK's government evidently is worried about contagion associated with developments in some other debt-intolerant (unable to increase debt without significant adverse market reactions) countries.

Establishing and then maintaining market confidence is essential to avoiding such an outcome. The key to doing so is to meet or exceed deficit reduction targets so as to build and sustain the fiscal credibility necessary to insulate one's government against a dramatic turn in market sentiments. The kind of self-reinforcing feedback that the UK government seems to be worried about would entail the markets' reacting badly to the government's current fiscal path, which would push up interest rates making raising debt service costs for newly issued debt. In turn, the government would need to respond with tax hikes/spending reductions. Such a policy would impede growth in aggregate demand/perhaps weaken it. Impeded or reduced aggregate demand would undermine macroeconomic growth. Reduced economic growth (or a recession) would push down tax revenues/raise expenditures (at least the countercyclical portion of the budget). In turn, the deficit would be larger than anticipated and an additional adverse market reaction would result. The cycle would repeat itself over and over. As that happens, the government would begin to run out of programs that it could cut without the risk of grave political repercussions. The overall result would be recession/stagnation, persistently high unemployment, larger debt, reduced access to capital, and increased public pressure on the government to abandon its austerity program.

The UK government is hoping that the magnitude of fiscal sacrifice it announced will provide it with sufficient fiscal credibility in the immediate term. It probably should, unless indications that it cannot implement the policies emerge in coming days and weeks.

Afterward, the next milestone would be for the government to meet or exceed its deficit reduction targets. IMO, the government's estimating economic growth below the IMF forecast is not a bad thing. Often, economic growth is lower than anticipated during fiscal consolidation/austerity programs, so there is a chance that the overall budget numbers might be more accurate than if somewhat greater growth had been assumed. Needless to say, if the government misses its deficit reduction targets, that would be a problematic development.

On a brighter side, unlike Greece and the U.S., a much greater share of Britain's debt is of longer-term maturities. Hence, the risk of a near-term liquidity crisis remains fairly low, even as the magnitude of the overall debt challenge is substantial.
 

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Alexa,

It should be noted that the budget plan announced concerns a five-year timeframe. All the cuts and tax hikes will not occur immediately.

Apparently, given its references to Greece, the UK government believed that there was a sense of urgency to preempt market developments that might spark concerns about a debt crisis that, in turn, would require more and more austerity to try to fend it off. Market psychology can be extremely fickle. Markets can go to excess. They can become irrational. The UK's government evidently is worried about contagion associated with developments in some other debt-intolerant (unable to increase debt without significant adverse market reactions) countries.

Establishing and then maintaining market confidence is essential to avoiding such an outcome. The key to doing so is to meet or exceed deficit reduction targets so as to build and sustain the fiscal credibility necessary to insulate one's government against a dramatic turn in market sentiments. The kind of self-reinforcing feedback that the UK government seems to be worried about would entail the markets' reacting badly to the government's current fiscal path, which would push up interest rates making raising debt service costs for newly issued debt. In turn, the government would need to respond with tax hikes/spending reductions. Such a policy would impede growth in aggregate demand/perhaps weaken it. Impeded or reduced aggregate demand would undermine macroeconomic growth. Reduced economic growth (or a recession) would push down tax revenues/raise expenditures (at least the countercyclical portion of the budget). In turn, the deficit would be larger than anticipated and an additional adverse market reaction would result. The cycle would repeat itself over and over. As that happens, the government would begin to run out of programs that it could cut without the risk of grave political repercussions. The overall result would be recession/stagnation, persistently high unemployment, larger debt, reduced access to capital, and increased public pressure on the government to abandon its austerity program.

The UK government is hoping that the magnitude of fiscal sacrifice it announced will provide it with sufficient fiscal credibility in the immediate term. It probably should, unless indications that it cannot implement the policies emerge in coming days and weeks.

Afterward, the next milestone would be for the government to meet or exceed its deficit reduction targets. IMO, the government's estimating economic growth below the IMF forecast is not a bad thing. Often, economic growth is lower than anticipated during fiscal consolidation/austerity programs, so there is a chance that the overall budget numbers might be more accurate than if somewhat greater growth had been assumed. Needless to say, if the government misses its deficit reduction targets, that would be a problematic development.

On a brighter side, unlike Greece and the U.S., a much greater share of Britain's debt is of longer-term maturities. Hence, the risk of a near-term liquidity crisis remains fairly low, even as the magnitude of the overall debt challenge is substantial.
Indeed. The Conservatives were indeed trying to compare us to Greece and Hariot Harman was saying that was a ridiculous comparison and that the UK was not seen as being in such dangers of losing market confidence.

One side, Labour believe that cutting back now, making so many unemployed, making people have less to spend is likely itself to cause a further depressive and the other, the Conservatives compare us to Greece and say it is urgent and we must all share the pain, pain, pain.

In reality we will just need to wait and see, but given that even you agree the comparison with Greece is not a very credible one,.......
 

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In reality we will just need to wait and see, but given that even you agree the comparison with Greece is not a very credible one,.......
Alexa,

I believe there are substantive differences between the UK's situation and Greece's. Commonalities include large budget deficits. Differences include debt structure, better trade balance for the UK (including a viable export sector), greater debt tolerance for the UK. Greece's long-term fiscal outlook is also much more grim than the UK's, though both face substantial long-term fiscal challenges.

Market psychology, though, is a very fickle thing. One cannot assume that markets will always act rationally (indeed, I believe some of the fear-driven reaction to Greece's woes that fueled a genuine risk of contagion in the wider European Union was not rational). I suspect that the new coalition government in the UK was quite worried about market expectations, not to mention a possible downgrade in the UK's credit rating.
 

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Alexa,

I believe there are substantive differences between the UK's situation and Greece's. Commonalities include large budget deficits. Differences include debt structure, better trade balance for the UK (including a viable export sector), greater debt tolerance for the UK. Greece's long-term fiscal outlook is also much more grim than the UK's, though both face substantial long-term fiscal challenges.

Market psychology, though, is a very fickle thing.
One cannot assume that markets will always act rationally (indeed, I believe some of the fear-driven reaction to Greece's woes that fueled a genuine risk of contagion in the wider European Union was not rational). I suspect that the new coalition government in the UK was quite worried about market expectations, not to mention a possible downgrade in the UK's credit rating.
Indeed and I heard some people suggesting that the Conservatives even suggesting this could create it. Still we will need to wait and see the consequences.

The bit about the credit rating. I think Hariot Harman said yesterday that our credit rating was just fine and that there was no reason to think this.

I am wondering now if there could be some other reason or whether maybe the Conservatives just decided on this way to fight the election.

Does anyone gain here in a way we don't see?
 

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It is though looking like this is not the full story. SMF says the cuts in public services are more likely to be 34% rather than 25%,

Commenting Ian Mulheirn, Director of the SMF said:

"To cut one pound out of every three from the Department for Business, Innovation and Skills, Home Office and Department for Work and Pensions is a huge ask. These cuts are equivalent to the entire running costs of the prisons and courts; more than half spending the police; and the entire pay bill for Jobcentre Plus. It is very questionable whether cuts of this size can really be found.

To make the deficit reduction plan feasible, it seems likely the Chancellor will be back with more tax rises and cuts to benefits."
SMF | Coalition Cuts to public spending of 34 per cent looming - new analysis of emergency budget shows the chancellor will be back for more tax

Ken Clarke has already announced plans to cut around 30% of courts in England and Wales.

George Osborne has said he could avoid cuts of more than 25% if he could get even more cuts than the £11billion to welfare already planned - not harming the poor most?

These apparently will be the biggest cuts since WW2. I think there could be revolution.
 
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Infinite Chaos

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-- Ken Clarke has already announced plans to cut around 30% of courts in England and Wales --
You couldn't provide a link to this could you? I'm interested to see what they do to the courts services and legal aid.
 

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I was just thinking of questioning whether the Lib Dems would ever get another seat in Parliament when I came upon this article where they may have been thinking the same themselves. Seems a revolt is in the offing already possibly led by Charles Kennedy.

Nick Clegg faces revolt over VAT increase - mirror.co.uk

Seems the VAT rises did it.
 

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Thanks Alexa

It doesn't seem to be dealing with legal aid - of course that will be next.
I doubt they will take it away completely - I think the threshold for receiving it will be raised and the threshold of winnings you can have before you have to start paying it back will be lowered.

I was just thinking of questioning whether the Lib Dems would ever get another seat in Parliament when I came upon this article where they may have been thinking the same themselves. Seems a revolt is in the offing already possibly led by Charles Kennedy.
BBC reported today that it was a memo led by Simon Hughes - a "warning shot across the bows" that their support could not be taken for granted.
 
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I doubt they will take it away completely - I think the threshold for receiving it will be raised and the threshold of winnings you can have before you have to start paying it back will be lowered.
No we seem to be saved from that by being a member of the EU and certain needs concerning Human Rights apply.

But savings how?
The problem for Clarke is that not only has the ministry's budget been squeezed in recent years – the 2007 comprehensive spending review cut it and envisaged the MoJ making annual savings of over £1bn by 2010/11 – but it was already being wrung yet further. In March, the MoJ committed itself to delivering £343m of the £11bn annual efficiency savings from 2012/13 announced in the budget, and surprised many by volunteering to save a further £360m as part of the Public Value Programme, through reforms across the criminal justice system and legal aid.
Death by a thousand cuts for legal aid | Law | guardian.co.uk

Looks like he may be being subtle or dirty which ever way you want to look at it. He has changed the way in which it is paid from ongoing to only after the case is closed.

This has already caused the shut down of an Asylum seekers charity. ROP will no doubt be pleased. Killing two birds with one stone

David Cameron worked hard to "detoxify" the Conservative brand in the years leading up to the election - partly by keeping major party players in the background.

But weeks after coming to power Clarke's actions have cast them as the Nasty Party- as Home Secretary Theresa May once dubbed the Conservatives.

Clarke in one of his first moves as Lord Chancellor and Secretary of State for Justice has confirmed legal aid will be paid only after a case is closed - rather than every month. This means people representing complex legal cases could wait months and years for payment for their work.

The move has immediately resulted in the bankruptcy of the Refugee and Migrant Justice charity which in the past year has represented 11,000 people, many of whom are asylum seekers fleeing murder, war, rape and torture - including children.[/quiote]

New Left Project | Blogs | Clarke spark: Demonstrate at Lord Chancellor’s legal aid trick to shut down asylum seeker charity
also reported in the Guardian

Collapsed charity 'unable to manage its affairs' | Law | guardian.co.uk
 
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-- He has changed the way in which it is paid from ongoing to only after the case is closed.

This has already caused the shut down of an Asylum seekers charity. ROP will no doubt be pleased. Killing two birds with one stone --
From personal dealings I can see the sense but your example of what has happened to charities dealing with Asylum was something I hadn't foreseen.

What I mean is that making it payable AFTER the case would force lawyers to try and conclude cases much quicker. There is no need for legal aid (or even lawyers and judges) in the family courts - the current system is a gravy train even though many family law lawyers despise the lower payments they get working on legal aid cases. Why I say no need in family law is that 95%+ cases are predetermined by precedent anyway - whichever parent is in "possession" of the children at the time of court proceedings will retain residence.

However - in criminal cases - we have to tread carefully, there is a right to legal representation and cases can be open to being determined. Forcing lawyers to try and conclude cases simply because they want to get their legal aid fees quicker isn't good for justice and the charities example you give was something I simply hadn't come across (not my area in or of courts)
 

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Amusingly, today's Daily Mirror said that

Raisng taxes is a penny-pinching, wallet-stealing crime!
Interesting that, considering that the paper's beloved New Labour did nothing but and often sneakily, hoping people wouldn't notice.


VAT's at 20%, which is bound to hurt, but I'd have more sympathy for the line that pennies must be pinched to reverse New Labour's fiscal lunacy (true) if the Con-Libs weren't so hypocritical.


If we cut back on 'asylum seeker' charities so much that they close then we can also (as I've said) hack back on the £8 billion foreign aid bill. Indeed, the Yanks found that African states CUT BACK on their own social welfare spending when the gullible white oafs can be persuaded to fork out themselves. (see pic)

(And whilst we're on the subject, seeing as our Western governments love going to war, let's threaten these African dictatorships with armed deposition if they don't feed the people with the money we send them. Why would we pay for their palaces, tanks and planes as their people starve?!)


And another thing, we can also cut back on the EU's pocket money. God almighty, we give them £118 billion each year just to split Britain up, straighten our bananas, drive British farmers to suicide and insist all our donkeys have passports, so why not slash back on that too? We've lost supreme executive control of the nation, so we can hand over less to reflect our diminished status. Only fair, and we can't exactly be punished if we don't want to take it.



EUROFUHRERS' CASH DEMANDS LEAVE US BROKE: http://www.telegraph.co.uk/news/worldnews/europe/6198708/EU-costs-Britain-118bn-a-year.html


LEFTARD DONKEY RULES: Council Directive 90/426/EEC says your mules must also be photographed, though if that's not manageable then a DOODLE will do just as well! Just as mad as allowing NIQABS to be photographed for passports for Chrissakes!






______________________________




Lastly, it's not as tragic as that if charities fighting to keep asylum seekers here close down - even if every single perfectly concocted sob story was eye-wateringly true. Indeed, they must have been scared, scared enough not to notice that the typical 'asylum seeker' frantically scurries through A DOZEN SAFE AND HOSPITABLE SANCTUARY COUNTRIES on the way to Soft Touch Britain!


I'm not exactly glad (as Alexa reckons) because if I wanted to make it fair I would swap one bona refugee for at least two economic migrants or health tourists. But it's scarcely surprising that we're running out of resources to feed the world.




If they're glad to be out of their war-torn hellholes then what's wrong with decamping to Spain? It's closer to places like the Middle East than we are and if our old friend Andalablue likes it there than it can't be that bad.

Or what about France? I received a rebuke from the moderators for an 'ethnic slur' when talking about the French Establishment, even though the average Frenchie and I share much the same DNA and even the same skin tone. So, no territory of sub-humans there.

Italy? They take no nonsense but the Italians are still signatories of much the same 'human rights' legislation as we are.



Germany? Austria? Planty of places. We've had more than our share, we've done our bit. Let's not worry too much for funding these things mandatorily any more, especially as we're not exactly the only ones taking it upon ourselves to look after the world.
 
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When it comes to money they're not stupid out in Africa. Just taking us for mugs.

High Cheek about which the Liberals are totally silent!.jpg


Wonder what old Hope O-barmy has to say about this little scam?!
 
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