Friday, Jun 25, 2010
Only in government finances can a 12% increase be presented as a 25% cut
Index Universe: Adapt or Die
Question: In which version of mathematics does a change from 637 to 711 equal a 25% drop?
Answer: The type practised by the UK’s new Chancellor of the Exchequer, George Osborne.
Only in the weird and wonderful world of government finances can a 12% increase be described as a 25% cut. The Daily Mail, for example, seemed a little uncomfortable admitting in the body of its article that spending is due to rise over the next five years, despite its “slash and burn” headline.
Posted by paul amery @ 02:41 PM (656 views) Add Comment
6 Comments
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1. Notyethomeless said...
Hum...if the increase just covers inflation / increased debt costs, then the proportion actually spent on services could be cut by 25% even though the overall amount increases.
I don't think the article makes it particularly clear...
2. simon68 said...
“In 1976, Britain was so hard up that it had to go to the IMF for a loan. Without this assistance, the government would have likely defaulted. The IMF insisted on its usual "austerity" plan, with spending reductions and higher taxes of course. In 1979, Margaret Thatcher became prime minister. Thatcher is remembered today for her sweeping reorganization of government, in which public employees, subsidies and state-run businesses were slashed or discarded. She crushed the influence of public unions in the face of widespread strikes.
Despite this, in the 1983 general elections, only 39% of union members voted for the opposing Labor Party. Thatcher was popular. Why?”
Hope Lib-Con’s austerity plan works, saving the need to ask for loan from IMF.
3. hpwatcher said...
I just don't think people can handle the cuts. The govt will default and we will go to the IMF.
4. markj69 str05 said...
@pa... Perhaps the original plan was for a 16% increase, but they reduced it by 25%. Hence, only a 12% increase!!!
Financial wizardry. My theory is - not to believe a word printed anywhere. Or at least take it with a large pinch... They'll paint it any way they want.
5. easybetman said...
The 25% headline was actually up to 25% in some departments. This is because NHS spending will increase above inflation and benefits/pensions etc are the growing part of the budget. Website shutdown, quango etc are the 25% cut target.
So yes, overall not cut and 7xx billion will likely to be close to 50% of UK GDP.. more needs to be done (unless UK found some new technological innovation or gold/oil field )the m
6. Fishbone Glover said...
Hmm, and there was me thinking that the new lot might have been different. Plus ca change!
Recaptcha - 1976 oftenest! (Do computers have a sense of humour? :) )