Vir Cantium

I'm right, you know …

Category Archives: Numbers

Always Someone Else’s Fault

1 plus 1 equals 3It must be great not having to hold down a proper job in order to make a living. You could be an academic research professor, for example, like George Irvin. Don’t blame the baby-boomers, he says, it’s all a right-wing conspiracy/Thatcher’s/the City’s fault. Take final-salary pensions for example:

Final salary-linked pensions have virtually disappeared in the UK because occupational pension savings were handed to City fund managers who made millions from investing them in stocks and shares. Some companies even took “pension holidays” to boost their share prices. When the market collapsed, so did “funded pensions”. Yes, of course there is a demographic problem, but most other EU countries have made reasonable provision for topping up their pay-as-you-go schemes.

Here we go.

No, George. Final salary-linked pensions have virtually disappeared because (a) they were fundamentally unsustainable, (b) a certain Labour chancellor helped himself, from them and their money-purchase counterparts, to £5bn a year (and still overspent the national budget) and (c) companies were forced to start loading a more realistic measure of the liabilities of said pensions onto their balance sheets after a change in the accounting rules.

By the way, if those evil satan-spawned “City fund managers” hadn’t invested them in stocks and shares, then the situation would have been even worse.

A funded pension won’t “collapse” because of any “market collapse”. As one nears retirement, more of the pot is transferred into cash and bonds, sheltering it from the fluctuations of the stock markets. The younger contributor will see their pension fund reduce in value, but they also have time to take advantage of market rises, and anyway what is the alternative? An unfunded scheme that forces a pensioners still-working colleagues to pay for his retirement – either through their own contributions or taxes? How very fair. Not.

Oh, and just because other EU countries have found some money to shovel into the black hole made reasonable provision for topping up these unsustainable schemes, it doesn’t mean they’re still unsustainable or not one small step removed from Ponzi schemes.

As for the basic point of George’s article, no I don’t blame the baby boomers. I blame those of the baby-boomers’ parents who voted for the socialists that dumped some nice but financially ill-thought out ideas on us.

H/t Tim, who has rounded on another excerpt.


I Didn’t Think Things Were Getting That Bad …

Again via the InformationIsBeautiful site, I came upon Good Magazine and their wealth of “transparencies”, including this one: an analysis of immigration into the USA.

So far, so mildly interesting – until you look at the more detailed figures around the main graphic. It seems that, of the 16,189 people who moved to the US from the UK last year, 64 were doing so as refugees or asylum seekers.

So, should I finish this post with the words “I say, that’s a bit much!” or …

“What, only 64?”


No, I’m not bragging about my visitor numbers (believe it or not I’m not quite in the Guido/Dale league).

I have found what can only be described as something approaching statisticians’ porn. The chap behind this site specialises in translating statistics into graphical formats, but also rails against pointless or patronising graphics. As I’m not only an anorak when it comes to this sort of thing generally, but also one who detests contextless numbers in the media, this is right up my street.

In particular I couldn’t help noticing his analysis of the safest part of the aeroplane to sit in. On a personal note, my grandfather, who served as a Flight Engineer on Lancasters, always advised sitting as close to the tail as possible because (he said) that’s the bit that often falls off in one piece (perhaps that’s why the “black boxes” are put there?). This was rather ironic in his case, given that when he was shot down he was in the nose, which was blown off when his aircraft exploded … though I suspect the parachute might have helped as well.

H/T: B3ta

A Little Knowledge

It may seem a bit behind the times to be commenting on the Budget, now over two weeks’ ago – but as any accountant will tell you, the least reliable way to try and work out what’s in the Finance Bill is to listen to the Chancellor’s speech. In any case, I’ve been on paternity leave, so there.

Now then, if you will bear with me for a short technical bit, we come to the new provisions for pension contribution tax relief for the “rich”.

Until 22nd April, someone earning, say, £200,000 a year could put up to £200,000 into their pension fund that year and get tax relief at 40% – their marginal tax rate*. After 22nd April, of course, anyone earning more than £100,000 is a disciple of the devil and must be squeezed until the demons are exorcised (or emigrate). So from April next year, those on much more than £150,000 per year will only get 20% relief on their pension contributions – and that’s quite a loss (£40,000 on a £200,000 contribution).

So, suppose you were in the higher echelon of earners – say, an MP or maybe even a minister – and wanted to get in before the new rules come into effect. You might suddenly whack in a big lump sum into your pension now before the government shut the door.

But the Treasury has thought of that, and special rules came into effect from Budget Day to stop such “forestalling” measures. So that’s that. You’re stuffed.

Except …

You are, as I mentioned earlier, an MP. As it happens, you are a Labour MP and on the Monday, two days before Budget Day, you contact your financial adviser and put £400,000 into your pension – something you wouldn’t be able to do the following week without losing £80,000 in tax relief.

Not that you’re doing anything akin to insider trading – it was pure coincidence, of course.

And don’t let anyone tell you otherwise. Move along now, nothing to see here.

P.S. As that Labour MP, you will no doubt be aware that you can do the decent thing and get a refund of said contribution – though that might not stop the grubby details coming out….

* (Pedantic note: Technically they could put up to £245,000 if they have enough relevant earnings.)

Anyone For Bangers and Mash?

Swine Flu GIF by HappyToast

So, we’re all going to die.


Yes, even as the staggering (though regrettable) total of, err, 7 deaths have been confirmed in Mexico from swine flu (as of yesterday), saner voices are, as usual, struggling to be heard amid the zealotry of the panic-mongers.

Some have pointed out, for example, that bird flu has stubbornly failed to wipe out the 50,000 promised just for the U.K. (the worldwide actual total is, as of the 23rd April 2009, a scary 257).

Many will remember the BSE scare as well, though. We were all going to die from CJD/vCJD because it was caused by eating BSE infected beef (and, naturally, it was all Mrs Thatcher’s fault). We knew this was true because some scientists said so, shortly before asking for public money to continue monitoring the situation, just to be sure.

People laughed at John Gummer. They also laughed because he had fed his daughter a hamburger to demonstrate how safe beef actually was. Well, on this issue (as opposed to his views on evolution), he was right: confirmed and probable deaths from vCJD since 1990 (to 6th April 2009) have totalled 1,390, with 164 confirmed vCJD fatalities. A sum not at all adjacent to the millions forecast by the more shrill experts scaremongers.

Of course, the inconvenient truth about BSE/CJD is that no link has ever been proven between the human and bovine forms, which means that, unlike influenza, many resources have been expended on what is quite possibly the wrong line of attack.

Anyway, in the meantime, I suggest we make the best of it, and while the morons stop buying pork products “cos of the pig flu innit – I gotta fink of me kids”, we can benefit from reduced prices for bacon and bangers. Just in time for the barbecue season.

(H/T for the GIF: HappyToast via B3ta)

British Industry is Still Alive, So The Left Call for Its Head

Somehow I never fail to be both astounded and depressed at the scale of economic illiteracy in the country.

Today saw another successful British company announce some decent quarterly results (pdf 183K). The BP group announced profits before tax for the second quarter of some $15bn.

Inevitably, then, we have heard the bile-laden spiteful calls for a “windfall tax” on BP and other energy companies. So, rather than applaud BP, noting the benefits to many of our pension funds, the extra investment that the company will be able to make as a result of those profits, we try to do down the company that provides a livelihood for thousands of British employees.

BP and other oil producers have been facing calls from unions for a windfall tax on their profits to help those struggling to cope with higher energy costs.

“A windfall tax now would ensure that the money was there to help the old and vulnerable through these tough times,” said Unite general secretary Tony Woodley.

“Tax the fuel companies now so that those who helped to create these mega-profits get their rightful share of them.”

Quite how a 13% net profit counts as “mega” is unexplained, but then again if Mr Woodley actually understood business then presumably he wouldn’t be a union leader.

He also makes the rather odd connection between (a) a tax and (b) something which will “help the old and vulnerable” and getting the “rightful share” of those profits to “those who helped to create” them (rather than something which will simply get lost in servicing government debt, or bribing the voters in the next by-election, or channelled into the unions’ own coffers).

He also conveniently forgets the $5bn of tax which BP will be paying on these profits. Indeed “BP insists that it is already one of the UK’s largest taxpayers. A company spokesperson told the BBC that the company paid $14.5bn in taxes worldwide last year, including $2.3bn in the UK.”

Depressingly, we can expect the same lesson in how to create a hostile environment for business on Thursday when Centrica (British Gas) announces their latest results.

No good at drawing cartoons? Try accountancy instead

Have a read of this while I get on with some the devil’s work …

A 44 year-old man from Sittingbourne, Kent, has been sentenced to two years’ imprisonment for urging Moslems to launch terror attacks on accountants.

The Old Bailey heard that Malcolm Hodges, 44, had failed an exam set by the ACCA ten years ago, and had been arguing about it with the Association ever since. The grudge festered over time, and Hodges widened his one-man campaign by writing a series of letters to the royal family, the Chancellor and the Prime Minister, outlining the “grave injustice” behind his low marking.

Hodges’ mission changed from farcical to dangerous in November 2006, when he began writing to UK mosques, claiming to be a follower of Osama Bin Laden.

“Brothers, you are right to kill the infidels but you are making a mistake to try and attack planes and other targets,” he wrote. Instead Islamists would be better off declaring a “jihad” against the four accountancy bodies.

“Striking at these targets will be striking at the infidels where it hurts most”, the letter argued.

Earning a living and upsetting Islamofascists? I think my job satisfaction level just received a small boost.