New Lobby Group Claims UK Government Wastes £50 Bn

by Robert Lee, Tax-News.com, London

04 February 2004

A new lobby group known as the Taxpayers’ Alliance has claimed that the UK’s tax burden could be reduced by up to £50 billion through the eradication of government waste and inefficiency in the tax system.

The newly formed and self-funded pressure group counts among its advisory council figures such as the director-general of the Institute of Economic Affairs, John Blundell, and chief economist at the Institute of Directors, Graeme Leach.

In its new report, dubbed ‘The Bumper Book of Government Waste and Useless Spending 2004’, the TPA identifies £50bn of "wasteful and useless government spending" from over 500 sources, including National Audit Office and Public Accounts Committee reports, Hansard and Parliamentary Written Answers, radio and television broadcasts and newspaper articles.

Among the largest culprits identified by the report are: the £3.2bn wasted in fraud and mistakes in the benefit system; the £2.5bn Rail Regulator's estimate of Network Rail inefficiency; £1.8bn spent on British subsidies to EU farmers (excluding British farmers); £1.7bn wasted on failed projects written off by MoD; and the surging cost of running Whitehall, estimated at £1.4 billion.

By scrapping these wasteful projects, the TPA claims that the Chancellor could abolish both council tax and corporation tax (which raise £19bn and £31bn) or slice 10p off all rates of income tax.

"Our research shows that the government could have cut £50bn from expenditure in 2003 without closing a single hospital, firing a single teacher or cutting pensions,” observed TPA chairman Andrew Allum, at the launch of the Bumper Book.

“Returning the wasted £50bn to its rightful owners, the Great British taxpayers, would make each household on average £2,000 better off- a real boost to hardworking British families," he added.

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