Last month the Treasury Select Committee published a rather impressive report, Administration and Expenditure in the Chancellor’s Departments 2008-09, in which it expressed serious concerns about low morale and a lack of efficiency at HMRC. The report notes that:

“HMRC has an ambitious transformation programme to improve its efficiency involving a reduction in the number of people working for it, and a reduction and redistribution of the locations of its businesses. HMRC has already reduced the number of people in its organisation from 105,000 to fewer than 89,000.”

The Chief Executive of HMRC, Lesley Strathie admitted to the committee that she accepted that she had an unhappy workforce that nevertheless seemed committed to stay with HMRC. GIven recent staff cuts those remaining probably comprise a mix of the truly committed and the truly awful who did not volunteer to go as part of the cut backs.

The Committee was justifiably concerned that “a disengaged workforce with poor morale” could impact performance – in terms of collecting all taxes that are due. Lesley Strathie recognised that her workforce needed clarity “about whether they have a future in the department and what that future looks like…” She also saw a need to build up the tax profession to “upskill and accredit our people.” She acknowledged too that management needed to do more, telling the Committee that “many of our managers do not believe they need to change, and clearly we all need to change.”

I think this is all rather worrying for accountants and for tax advisers. Ever since the Government announced its desire to cut staff at the newly merged HMRC we have been concerned about the professionalism and ability of those who would be left behind. Five years on and it is clear that, for those who remain, morale is at rock bottom, the pressure is greater than ever and the quality of service is generally low.

I have never been convinced that the so-called “transformation programme” bore any relationship either to modernisation, improved service to ‘customers’ or increases in the tax yield. The committee may well be right to blame senior management for the low staff morale within HMRC. Perhaps they could have done better. However let’s remember that it was the Government who decided to decimate staff numbers, to close offices and to introduce complex new tax measures at short notice. I suspect that senior management are doing quite well given all of the obstacles placed in their way!

What do you think?

• The EBRI Databook on Employee Benefits includes data from dozens of sources to provide a comprehensive analysis of how the employee benefits system works, who and what its various functions affect, and its relationship with the U.S. economy.
• The EBRI Databook includes over 400 tables and charts presenting vital statistics on the employee benefit system.
• Topics include the retirement income system; employer-sponsored benefit plans; government programs such as Social Security, Medicare, and Medicaid; health insurance; and labor force and demographic trends.
• Tables and charts are supplemented by explanatory text to provide detailed information on the entire range of employee benefit programs and work force related issues.

Read More.

The 2010 Retirement Confidence Survey: Confidence Stabilizing, But Preparations Continue to Erode

March 2010
EBRI Issue Brief #340
Employee Benefit Research Institute, 2010

Download Issue Brief PDF

MORE PEOPLE HAVE NO SAVINGS AT ALL: An increased percentage of workers report they have virtually no savings and investments. Among RCS workers providing this type of information, 27 percent say they have less than $1,000 in savings (up from 20 percent in 2009). In total, more than half of workers (54 percent) report that the total value of their household’s savings and investments, excluding the value of their primary home and any defined benefit plans, is less than $25,000 (Fig. 14, pg. 16).

CLUELESS ABOUT SAVINGS GOALS: Many workers continue to be unaware of how much they need to save for retirement. Less than half of workers (46 percent) report they and/or their spouse have tried to calculate how much money they will need to have saved for a comfortable retirement by the time they retire (Fig. 23, pg. 22).

The audio and video will be available online at www.whitehouse.gov at 6:00 am ET, Saturday, March 13, 2010.

Remarks of President Barack Obama
As Prepared for Delivery
Weekly Address
March 13, 2010

Lost in the news of the week was a headline that ought to be a source of concern for every American.  It said, “Many Nations Passing U.S. in Education.”   Now, debates in Washington tend to be consumed with the politics of the moment: who’s up in the daily polls; whose party stands to gain in November.  But what matters to you – what matters to our country – is not what happens in the next election, but what we do to lift up the next generation.  And the fact is, there are few issues that speak more directly to our long term success as a nation than issues concerning the education we provide to our children. 

Our prosperity in the 20th century was fueled by an education system that helped grow the middle class and unleash the talents of our people more fully and widely than at any time in our history.  We built schools and focused on the teaching of math and science.  We helped a generation of veterans go to college through the GI Bill.  We led the globe in producing college graduates, and in turn we led in producing ground-breaking technologies and scientific discoveries that lifted living standards and set us apart as the world’s engine of innovation. 

Of course, other nations recognize this, and are looking to gain an edge in the global marketplace by investing in better schools, supporting teachers, and committing to clear standards that will produce graduates with more skills.  Our competitors understand that the nation that out-educates us today will out-compete us tomorrow.  Yet, too often we have failed to make inroads in reforming and strengthening our public education system – the debate mired in worn arguments hurled across entrenched divides. 

As a result, over the last few decades, we’ve lost ground.  One assessment shows American fifteen year olds no longer even near the top in math and science when compared to their peers around the world.  As referenced in the news report I mentioned, we’ve now fallen behind most wealthy countries in our high school graduation rates.  And while we once led the world in the proportion of college graduates we produced, today we no longer do. 

Not only does that risk our leadership as a nation, it consigns millions of Americans to a lesser future.  For we know that the level of education a person attains is increasingly a prerequisite for success and a predictor of the income that person will earn throughout his or her life.  Beyond the economic statistics is a less tangible but no less painful reality: unless we take action – unless we step up – there are countless children who will never realize their full talent and potential

“The Chinese are laying highways like nobody’s business,” added Agora’s Chris Mayer. “By the end of 2008, China had an estimated 60,000 km of highway. The US has 75,000 km. Over the next few years, China plans to have 85,000 km of roads.”

Is building activity in China a boom or a bubble? Please share your thoughts with readers by posting a comment. (Click on “Comments” below the heading of this post and type away.)

Source: Agora Financial’s 5 Min Forecast, March 10, 2010.

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The Congressional Budget Office said this week (via Bloomberg) publicly held debt will zoom to $20.3 trillion, amounting to 90% of GDP, by 2020. By then, interest payments on the debt will have quadrupled to more than $900 billion annually.

Referring to the debt situation, Richard Russell (Dow Theory Letters) said: “If the Treasury and the Fed just stare at this figure and don’t do anything the compounding interest on $12 trillion will ‘eat us up alive’. With $12 trillion in national debt, the US must try to inflate the debt away or renege on it. Reneging on the debt is unthinkable, which leaves the inflation strategy. The problem must be addressed, since if it is not, the compounding factor will simply make the problem that much more intractable.”

What a predicament!

Source: Cracked.com (hat tip: The Daily Reckoning).

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Yesterday, Vice President Biden spoke at Tel Aviv University in Israel about the partnership between the United States and Israel:

Israel’s unique relationship with the United States means that you need not bear that heavy burden alone.  Our nations’ unbreakable bond borne of common values, interwoven cultures, and mutual interests has spanned the entirety of Israel’s history.  And it’s — it’s impervious to any shifts in either country and either country’s partisan politics.  No matter what challenges we face, this bond will endure.  As a result, generations of Israelis and Americans and American-Israelis have kept a foot in each country, enriching both our nations and peoples.  I met with some of your leading high-tech leaders earlier, prior to coming to the stage.  And they have a foot in both countries, many of them.

While these close relationships span the realm of commerce and education, medicine and technology, culture and the arts, at its core is an ironclad commitment to security — Israel and my own country’s.  Every day, Israel faces bravely threats no country should have to endure.  No parent should their child to schools equipped with air raid sirens in the year 2010.  No government should be expected to turn a blind eye while an enemy calls for its destruction.

I am here to remind you, though I hope you will never forget, that America stands with you shoulder-to-shoulder in facing these threats.  President Obama and I represent an unbroken chain of American leaders who have understood this critical, strategic relationship.  As the President said recently, “I will never waver from ensuring Israel’s security and helping them secure themselves in what is a very hostile region."

To watch the full speech, click here.

Earlier this week, the Vice President also spoke with Palestinian Authority President Mahmoud Abbas at Ramallah and with Israeli Prime Minister Netanyahu in Jerusalem.  

A fact sheet, embargoed until 11:15AM EST, is attached.

WHAT: Background conference call on the President’s National Export Initiative with Mike Froman, Deputy National Security Advisor for International Economic Affairs

WHEN:  Today, Thursday March 11, 2010
                9:00AM EST

CALL WILL BE ON BACKGROUND AND EMBARGOED UNTIL SPEECH DELIVERY

# #

Earlier this week, Domestic Policy Director Melody Barnes was interviewed on BET’s 106 and Park to encourage the nation’s public high school students to tell the President why their school is the best in the country at preparing students for college and career choices. 

Help spread the word to students and schools in your community that you think deserve the commencement speaker of a lifetime – and tell them to get their applications in before the deadline on midnight on Monday, March 15th.