Last year, Ealing council gave resident tax-payers a £50 refund. Many were surprised. We pay tax to the council, nobody expects money back, but they insisted and the supposed aim was to encourage people to go out and spend £50 locally that they might not otherwise have done.
But it was a flawed operation because this was a cash refund. Most people just got the money refunded back to their current account. So there was no compulsion to spend the money locally. Of course a voucher scheme could have been created – like the 20p-off coupons you used to see in magazines – but that would have cost a lot to administer anyway.
I’d like to suggest an alternative idea that really works, for both residents and the council. In São Paulo, Brazil, the local residents all pay their local council tax to the local authority, but the local authority also issues all tax-payers with a card similar to a credit card. When making any purchases, no matter how large or small, they can use this ‘council card’ as a loyalty card. The council totals up how much you spent in the local district over the past year and issues a refund to you based on a percentage of what you spent.
So the card ensures that local residents can prove they are spending money in the local area and even local corner shops ask for the number.
It’s not perfect. It does mean the better off and those with more disposable income can create a bigger council discount by spending more locally, but it does at least encourage residents at all levels of wealth to spend locally, knowing their tax bill will be reduced if they support local bars, restaurants, and shops.
A simple idea. When will a local authority in London introduce it?
Posted in Uncategorized
Tagged 5, brasil, brazil, citizen, council, council tax, ealing, londonw, rebate, refund, sao paulo
Last year we suffered a near collapse in the entire global banking system. At the time, people started questioning how the international finance business could remain in the private sector. There was a de facto takeover by the state in both the USA and UK as banks and insurance companies were bailed out by the government, which then became the owner and controller of several high-street brands.
But that seems to be all forgotten now. Everyone I talk to in the City seems to behave as if things are just the same as they were back in the boom years. Bonuses are being paid again – even when it’s really the government paying them. What happened?
While the City appears to be back to business as usual, the public sector is falling apart. All the talk in the past few weeks has been from politicians of all shades warning of how they will need to make cuts in future. Now the Chancellor is starting to brief ministers about what they need to do.
Everyone I talk to has discounted the Labour party winning the next election. Even Labour supporters have given up on their own party. Yet, I think it’s too soon to call a victory for the Tories. Cameron is not riding so high in the polls that an outright victory is clear-cut. Even though most people are fed up of the present government, the Tories are not generally seen as saviours. They don’t have the answers to this global financial meltdown and all the issues it is presenting now for the public sector since the recession started.
But, whoever wins in 2010 will have a huge problem to deal with. £175bn borrowed this year. Even trimming budgets here and there can probably only save 10% of that.
There will need to be radical cuts and changes in the nature of how government services are delivered. New ideas like the G-Cloud mooted by Lord Carter in the Digital Britain report are only the start. It’s about time we explored how a government structured on hundreds of years of processes can be re-engineered to deliver in the digital age. That won’t be easy, and not every citizen is a digital native, but this cash crisis is creating an environment where no ideas can be ignored.