If councils sell assets it will be harder to provide services – so why is the government encouraging it?
According to the BBC, the government has agreed to relax budgeting rules for a record 29 English councils to allow them to balance their books next year. They will be allowed to use Treasury loans or cash from selling assets to cover day-to-day spending, which they are normally banned from doing.
But ministers will encourage councils not to sell off “community and heritage assets” to help meet current spending pressures.
There’s just one problem: if councils sell off their assets, it will become harder – not easier – to provide services because they will have to rent the equipment to do so from private owners at higher prices.
Buy Cruel Britannia in print here. Buy the Cruel Britannia ebook here. Or just click on the image!
Here’s Gary Stevenson to explain, in a video clip I highlighted last year:
And here’s the gist, as I wrote it back then:
“In brief: neoliberal governments since 1979 have sold off all the property they own, meaning that – in order to provide services – they have to rent property from the rich people to whom they sold it all.
“This is, of course, a ridiculous proposition because renting property from rich people is much more expensive than owning it oneself. We can see this from the sale of council housing; now councils don’t have any low-cost, low-rent houses, more and more people are becoming homeless because they can’t pay the sky-high rents demanded by private landlords, or the sky-high mortgages demanded by lenders.
“So ordinary working people are now having to pay enormous taxes in order to allow our governments to pay for these services at exorbitant prices, because they’ve given all the means of providing these services to the rich.
“And when we hear talk of more taxes, we logically conclude that it refers to us paying them – after all, wealth means dodging taxes; the rich pay very little in comparison to the rest of us.
“Gary is saying we need to make sure those very wealthy people have to pay more taxes – at a level that will force them to sell the assets they have bought from the government and hoarded away from the rest of us.
“If our governments own their own assets again, then they will be able to provide the services we need at a much lower cost and our taxes can fall again, for a realistic, justifiable reason.
“That way, we will all enjoy more prosperity.
“That is why the likes of Jeremy Hunt and Rachel Reeves [pictured] are absolutely wrong to say they want to cut taxes. They mean they want to cut taxes for poor people, and the only way to do that is to cut public services.
“And you’ll still be paying more, because the government will be using privately-owned assets to provide its services.
“The problem is, they don’t want to increase taxes for rich people, partly because they are rich people, and partly because rich people give them donations to keep them from forcing those rich people to give money to the Treasury.”
We know that selling assets won’t help balance the books in the long term because the number of councils requesting government help to do so has increased to 29 this year, from just five in 2022 – and many of these councils have repeatedly requested help, year-on-year.
So we know that selling assets and taking loans from the Treasury is not the answer – in fact these measures only increase councils’ debt.
The government is desperately trying to find a new funding formula that will allow councils to provide their services and that will not require taxation of the rich – re-distributing wealth to prioritise councils with a lower or poorer population that are less able to provide much funding of their own.
But that won’t work because if councils have more money, asset-owners will charge more for the use of their buildings, equipment or whatever.
The only answer is to get the assets back; they should never have been sold. And the only way to do that is to tax the rich.
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If councils sell assets it will be HARDER to provide services
If councils sell assets it will be harder to provide services – so why is the government encouraging it?
According to the BBC, the government has agreed to relax budgeting rules for a record 29 English councils to allow them to balance their books next year. They will be allowed to use Treasury loans or cash from selling assets to cover day-to-day spending, which they are normally banned from doing.
But ministers will encourage councils not to sell off “community and heritage assets” to help meet current spending pressures.
There’s just one problem: if councils sell off their assets, it will become harder – not easier – to provide services because they will have to rent the equipment to do so from private owners at higher prices.
Buy Cruel Britannia in print here. Buy the Cruel Britannia ebook here. Or just click on the image!
Here’s Gary Stevenson to explain, in a video clip I highlighted last year:
And here’s the gist, as I wrote it back then:
“In brief: neoliberal governments since 1979 have sold off all the property they own, meaning that – in order to provide services – they have to rent property from the rich people to whom they sold it all.
“This is, of course, a ridiculous proposition because renting property from rich people is much more expensive than owning it oneself. We can see this from the sale of council housing; now councils don’t have any low-cost, low-rent houses, more and more people are becoming homeless because they can’t pay the sky-high rents demanded by private landlords, or the sky-high mortgages demanded by lenders.
“So ordinary working people are now having to pay enormous taxes in order to allow our governments to pay for these services at exorbitant prices, because they’ve given all the means of providing these services to the rich.
“And when we hear talk of more taxes, we logically conclude that it refers to us paying them – after all, wealth means dodging taxes; the rich pay very little in comparison to the rest of us.
“Gary is saying we need to make sure those very wealthy people have to pay more taxes – at a level that will force them to sell the assets they have bought from the government and hoarded away from the rest of us.
“If our governments own their own assets again, then they will be able to provide the services we need at a much lower cost and our taxes can fall again, for a realistic, justifiable reason.
“That way, we will all enjoy more prosperity.
“That is why the likes of Jeremy Hunt and Rachel Reeves [pictured] are absolutely wrong to say they want to cut taxes. They mean they want to cut taxes for poor people, and the only way to do that is to cut public services.
“And you’ll still be paying more, because the government will be using privately-owned assets to provide its services.
“The problem is, they don’t want to increase taxes for rich people, partly because they are rich people, and partly because rich people give them donations to keep them from forcing those rich people to give money to the Treasury.”
We know that selling assets won’t help balance the books in the long term because the number of councils requesting government help to do so has increased to 29 this year, from just five in 2022 – and many of these councils have repeatedly requested help, year-on-year.
So we know that selling assets and taking loans from the Treasury is not the answer – in fact these measures only increase councils’ debt.
The government is desperately trying to find a new funding formula that will allow councils to provide their services and that will not require taxation of the rich – re-distributing wealth to prioritise councils with a lower or poorer population that are less able to provide much funding of their own.
But that won’t work because if councils have more money, asset-owners will charge more for the use of their buildings, equipment or whatever.
The only answer is to get the assets back; they should never have been sold. And the only way to do that is to tax the rich.
Vox Political needs your help!
If you want to support this site
(but don’t want to give your money to advertisers)
you can make a one-off donation here:
Be among the first to know what’s going on! Here are the ways to manage it:
1) Register with us by clicking on ‘Subscribe’ (bottom right of the home page). You can then receive notifications of every new article that is posted here.
2) Follow VP on Twitter @VoxPolitical
3) Like the Facebook page at https://www.facebook.com/VoxPolitical/
Join the Vox Political Facebook page.
4) You could even make Vox Political your homepage at http://voxpoliticalonline.com
5) Follow Vox Political writer Mike Sivier on BlueSky
6) Join the MeWe page at https://mewe.com/p-front/voxpolitical
7) Feel free to comment!
And do share with your family and friends – so they don’t miss out!
If you have appreciated this article, don’t forget to share it using the buttons at the bottom of this page. Politics is about everybody – so let’s try to get everybody involved!
Buy Vox Political books so we can continue
fighting for the facts.
Cruel Britannia is available
in either print or eBook format here:
The Livingstone Presumption is available
in either print or eBook format here:
Health Warning: Government! is now available
in either print or eBook format here:
The first collection, Strong Words and Hard Times,
is still available in either print or eBook format here:
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