Tuesday, 14 May 2024

There will be some creative accounting

in "the Budget" today. This always interests me.

Money will be taken from some places and put into other places. We will be told that certain cuts are "necessary" and that others are because the government is being "responsible". Then money will apparently be spent on "helping the battlers" - I say "apparently" because much of it is never spent at all. It is simply policy that never gets implemented.

This year the government is already telling us that "everyone who pays tax is getting a tax cut". The only problem with this is that it is not true. It may look that way but my brother and my brother-in-law have done their homework and neither of them is getting an actual cut in the amount of tax they pay. They will both be paying more for other things which are taxed. The "tax cuts" are supposed to help with these things. Both of them will be "tightening their belts".

I once knew a woman, now sadly deceased, of whom it was said at her funeral, "B...could make something from nothing".  It isn't actually physically possible to do that of course but she could (and often did) feed six or more extra people, people in need. She taught people how to budget. Her early life had been lived in what many people would have considered "poverty". She left school as soon as she was able and worked physically hard on the farm her father also laboured on. He was paid almost nothing and much of what he was paid was "paid in kind". B... learned how to budget when her mother died and she had to manage as best she could. 

B...went on to marry, to have children and to become even better at managing a household budget. She taught many others how to budget by her example. It was hard work. Not until a stroke stopped her in the last year of her life did she stop cleaning, cooking, gardening, sewing, knitting, tending the sick and more. With all that she and her husband still managed holidays in their caravan (but mostly parking in remote areas where they did not need to pay caravan park fees). They owned their own home and made sure their children had the opportunity to continue the education they had not had.

It was all done through hard work, very hard work. B... had no time for government "budgets". She would read through the analysis in the paper the following day and her daughter would tell me, "Mum pointed out..." and B... would have found the weak spots, the attempts to hide the manipulations.

There will be manipulations today. I am expecting some very creative accounting this time. Two economists often approached for comment have already said that the government cannot meet the targets they claim they can meet. My economist neighbour who works for the Tax Office has already laughed about the "tax cuts". There won't be any. 

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