Government Spending in the United Kingdom - Essay Example

Financial management General election in the United Kingdom vs. pressures to reduce government spending It is very important to predict what the Scottish economy will be like. This is where the parties have to propose on how the government is going to reduce the spending for almost the following four years. There is however no politician who can relish on how the government is going to reduce about £3bnfrom the amount that is spent of about £29.3bn by the Scottish Government. However this is meant to be tried through fresh thinking, ingenuity and novel ideas by organizations, economists and other financial advisers. While this is being achieved, financial stability should always be the first priority for investors and regulators despite the challenges for profitability in the financial sector brought about by expensive capital which will be automatically scarce. (Northrop, A, 2010). Politicians have become coy because they can not specifically tell what exactly is needed to be cut in the budgets. There are four things that were said that they were supposed to be cut before the elections by Gordon Brown. These were costs, unnecessary programs, inefficiencies, and budgets that have lower priorities. It is therefore evident that the decision to cut on the government spending is so tough. Every politician wants to reduce the £620bn big grey blob. These blobs are for pension, health, education and family benefits. (Guardian News and Media Limited, 2011). Greater Manchester fire and rescue authority This is a fire service that is second largest in England that covers around 496 square miles in area. It responds to around 55000 fire emergencies in a year. When in 2003 it was faced with a budget short fall that was very significant, it had to make better use of resources through the identification of a way out. This was through matching of the risk profile of the community and availability of its people to the demand. It made employment contracts that were flexible as well as the duty systems. Through restoration of duty, £1.2 million had been delivered by annual savings that were done efficiently and its performance standards are much more improved. Through the flexible operational resource deployment the service is able to take a number of appliances off the run. Review of greater Manchester fire and rescue authority’s budget proposal for 2011 The cuts in the grants seem to be back loaded such that in the next two years of spending the cut will definitely be in digits that are single. However this makes a difference in the spending. The estimate is that in the following four years the grant will be less by 25% the amount that it is today. A cut of 25% from the grant really means very many changes by the service and its desire still to provide the necessary efficient services like in before and much more improved services. The budget does not however reveal the expectation of the service to raise the council tax level. This is so important because it is an expectation from the government and the authority must be in a position to consider the expectations of the public in general and specifically. The budget really affects or influences all families at different levels. Since the public offers their support to the fire and rescue services, they need not fill a not easy funding gap that the local council tax payers give. They need to be realistic so that they are able to recognize the difficulties that everyone faces so as not to impose burdens that are not necessary to them. This way they are not going to scare the public into funding them. It is thus assumed that the figure that appear in the treasury document show that the service be zero percent council tax increase it the following year such that there will be rise in council tax level by figures that will be even less than 5%. (McGuirk, S., 2010) In the proposal, there were also hints that there will be changes in public sector’s pension. However, there is a difference between the firefighters and other public schemes with them paying 11% of their salary and others paying single digits. 5here supposed to be some sense of equity though Hutton Enquiry should give the necessary answers to this problem. (McGuirk, S., 2010). Pay issues also affect their planning in that when the budget is looked at, 80% is pay. However, the government has called for restraints in pay and this is going to be fair for the fire fighters and the other support staff since they have been demonstrating this. It is expected that in 2011 the pay deal will be zero since it had declined in the past years with 2009 being 1.5% and in 2010 it was zero. This will make the firefighters to look at other occupations that are comparable such as nurses, and think about what feels fair. This will in turn result to frustrations to these firefighters making pressure to build up while thinking about issues that relate to pay. (McGuirk, S., 2010) All that this budget means, is that there is still uncertainty because of the much that is not known thus making it very difficult to plan. The size of the challenge needs to be well understood and addressed and think of transformation. If the idea of consolidation is well used then a lot of money will have been saved as well as quality services will be rendered out. Provisions should be provided that allow for such consolidations so as not to waste a rare chance of improving the service to the public instead of cutting it. (McGuirk, S., 2010). The service is not affected through the efficiencies found by GMFRS and they further want to improve their services. It is thus reviewing its management structure. Due to the global crisis, the provision of the public service on the way they are going forward. In the proposal there is value for money makes the service operate effectively and this then makes it to be influential naturally and has become innovative towards modernization. The impact on the proposal to cut the overall spending by 5% The proposal impacted very many people in the fire station as many of the cooks faced loosing their jobs so as the brigade could save £23m. More than 60 cooks are set to loose their jobs as well as other employees in the back room jobs. This was after estimations of the amount that the service was set to save in the four coming years. In general, due to the government spending cutting by the Manchester city council, more than 2000 jobs are to go. This is because the work force needs reduction by 17%. The national budget has a deficit and therefore the cuts need to be imposed. This leads to most of the council workers to be fearful, and most often some are shocked as they are uncertain of the security of their jobs. The prospect of many of the workers is daunted by these cuts and this shows that in five workers, one is definitely affected. This makes many to have their fingers crossed in the hope that they are safe job wise. Everyday as workers go for job, they are uncertain of the department that is going to be next affected and they fear that there will be redundancy that is compulsory. They publicly show their concern in hope that there is someone somewhere who will provide answers to their disturbing questions. Those who are in power openly declare the need for cut but they do not tell where the cut will fall. They show their desire to protect the frontline services through the cutting of the chief executive pay, joining of the back office services and procuring services and by cutting on the no jobs that are crazy. Top salaries are cut as the backroom functions and services are merged in an effort to provide value for money. There has been a raise in unemployment and the numbers of people who default on mortgages have also increased. People as well as businesses have had difficulties in securing bank loan. The councils also have experienced a rapidly falling income which was brought through planning, car parking, and building control. The number of those citizens vulnerable and are demanding for public services had risen due to the increase in number of those seeking allowances from the government. Areas for cuts from the proposal One of the area that was subject to cut is the area of employment as many of those who were in employment ended up loosing their jobs so as the service would save. This resulted due to the service merging many of the functions and services that were back room thereby trimming on the necessarily if the employees. Also they deployed the volunteers thus reducing the number of firefighters who would require real payments for the work done by them. There also were cuts by increasing on the council tax so that their services are well funded. There also has been the removal of ring fencing which was thought to cut on the spending by the government. The disposal of £30bn of fixed asse4ts which was done naturally also was another area of the cut. Landfills where household wastes are disposed were reduced as a way to cut on the spending by the government. Impact of the proposal on the financial controls and outcomes on the regional fire service Budgets that involve the property or the development impact the economic environment very well. This is seen particularly on the levels of income by the service. The ability of the council to collect revenues is much affected. This council collects the revenues from their sold assets, the income from the car parking, planning charges on the land, building control income, and the collected council income. Due to unemployment, there has increased demand of several of the council’s services by the public. (manchesterfire.gov, 2010) This is so evident from the financial reports of the service. These financial reports are the balance sheet, the income statement, and the cash flow statement. In the balance sheet the position of the business financially is shown as the total assets are well reported as well as the total liabilities of the business. In the income statement, the revenues are shown where the costs of goods sold are subtracted as well as the operating expenses. The net income before tax is also shown. Details on the cash received and the expended cash are then shown in the cash flow statement. This will t6ell one if the business has a positive cash flow or not. This is what aids business performance in that one can tell when the business cash flow is negative so that the business can be revisited and see where the problem is so that it can be solved in time before further damages are made. (manchesterfire.gov, 2010) It is thus true from these reports of Greater Manchester fire and rescue authority that the business is going on well after the recession. The current position of the business is thus seen as progressive. Compared with other periods before the decision, this year the business is really doing very well. The projections are thus progressive and this can provide a sound management ground and the guidelines and policies provided by the budget are enabling the business to grow and succeed. (Manchesterfire.gov, 2010) Risk areas in GMFRS and their relevance This service works with police, local authority, health service terrorist attacks and chemical leaks very closely. There is a requirement of a high degree planning of emergency at national level, local as well as regional levels. Areas of risks include multiple vehicles traffic collision on the roads that are very serious, train collision, a forced landing of a large air craft, chemical leak that is hazardous, bombing as an example of an incidence by a terrorist and some major flooding that involve a very big number of homes at risks. (Manchesterfire.gov.uk, 2010). All of these risk areas are actually accommodated in its account as far as the implementation of the proposed budget is concerned. Setting of the operational boundary and the authorized limits This is a legal composition of a company as to whether it controls the source of emission directly or not. This is essential in reporting of the company’s green house gas emission. It will show if an operation is core to the company and whether that operation controls the company financially. A company therefore needs to determine its organizational boundaries so as to be able to establish its operational boundaries so that the scope of the emission is defined within that organization boundary. The director of a company thus has the responsibility of establishing the three scopes of emission because there could be a possibility of having many operational levels in an organization. (verisae.com, 2010) The level of residual material that is radioactive that need not to be exceeded so that the curative action will be considered to be completed and its property will be released without any boundaries on how it is to be used because the residual material is radio active. The natural occurring exposure from the surrounding and the basic public limits of the dose for the exposure to the material that is radioactive are 100 mrem per year. The service is really operating well in their in their desire to achieve their aims and objectives which are to advance education through promotion, studying, and conservation of their history. It is known to be working with different bodies in their execution of their services and has been seen very well as it complies with the health and safety legislation in their operational work. This is a well operated work regarding the very difficult circumstances that they are called to work in. GMFRS is operating well. Through HSE, there are published principles that help employers inspectors from HSE and the general public in understanding how the employees in the fire and rescue employers can be able to comply with the safety and health requirements so that the public is safe guarded as well as the staffs themselves. This will in turn make it possible for the employees to provide effective emergency services. The development of such principles has been well done such that the firefighters, together with the other staff are helped to understand them practically and apply them in the operational work of the fire and rescue service. In such an operation, the approach is consistence and the inspectors of the HSE are well able to make their decisions such that culture is promoted within the service. This way, there is a proper way to deal with the hazards in a manner that is sensible, thought through and proportionate. The expectations of the fire and rescue service is then very well set through the management of the operations in the rescue service which are believed to be very hazardous, charged emotionally and moving very fast. The chief fire and rescue adviser has a responsibility to quality assure, commission, and do the publishing of the operational guidance. This operational guidance ensures an engagement that is wide in the sector of fire and rescue. They always thus have the responsibility to refresh, revive and do the development of this operational guidance. References Guardian News and Media limited (2011).UK public spending by government department, 2008/09[online]. Available: http://www.guardian.co.uk/news/datablog/2010/may/17/uk-public-spending-departments-money-cuts[24 Jan 2011] Manchesterfire.gov 2010, Greater Manchester Fire and Rescue Service - Financial Statements. [Online]. Available www.manchesterfire.gov.uk [24 Jan 2011] Manchesterfire.gov.uk 2010, Emergency Response. [Online]. Available http://www.manchesterfire.gov.uk/about_us/what_we_do/emergency_response.aspx [24 Jan 2011] McGuirk, S 2010, Spending Review – Refection. [Online]. Available http://www.manchesterfire.gov.uk/updates/chiefs_blog/221010.aspx [24 Jan 2011] Northrop, A 2010, PREDICTIONS: Which way will the wind blow in 2011? [Online]. Available http://www.business7.co.uk/insider-magazine/2010/12/03/predictions-which-way-will-the-wind-blow-in-2011-97298-22759112/ [24 Jan 2011] verisae.com 2010, Operational Boundary. [Online]. Available: http://www.verisae.com/page/1/operational-boundary.jsp [24 Jan 2011] Read More