The Red Budget Box

Not having access to daily news in the US means I’m not as in touch as I could be.  (Yes, I know I can get the news online, but it was much easier when got a daily paper and could turn on the evening news).  What did make headlines here recently is Congress’s inability to pass a budget and the subsequent “fiscal cliff.”  Doing a little digging online I’ve discovered that the Senate has not passed a budget since 2009.   In fact, they’ve only met the March 1st deadline four times in the last 30 years.[1] 

This topic only came to mind because today the Chancellor of the Exchequer (the Cabinet Minister responsible for economic and financial matters) left Number 11 Downing Street holding up a small, red briefcase known as the Budget Box for a mass of waiting photographers.   In it was the annual budget statement to Parliament, whereby the government lays out how taxpayer money will be spent in the coming year.[2]   Here there is no party bickering on what funds are sacrosanct, nor are there debates or stalling tactics on the floor of the Commons.  (The snarky comments all come after the budget is read.)  In fact, the budget is not created by parliament at all. Instead the budget is the product of a select few:  the Chancellor, several high-level Treasury Ministers, and the Prime Minister.  The contents of the budget report are not discussed outside of this golden circle, its details being held in the strictest of confidence until Budget Day.   

When the time comes, the outline of the budget is presented first to the Queen.  By tradition, the Chancellor dines with her the night before as he briefs her on its contents.  Cabinet Ministers are next, by which time the budget is, according to Rodney Brazier, professor of constitutional law at Manchester University, “a fait accompli.”[3]  Ministers may ask for minor changes, but nothing more.  The Chancellor then addresses Parliament later that day.  If the country is unhappy with the way the government decides to spend their money, they can express it at the next election.

Two things are significant about that last statement and differ greatly from the US:  the concept of government and the electoral process.  

In US national elections, one votes for candidates representing two branches within the federal system – one's Congressional representative (legislative) and the president (executive).   As is often the case, the president and Congressional majority leaders are members of different parties.  In the UK, the Prime Minister is chosen not by popular vote, but is simply the leader of the party that wins the most seats in Parliament.  So the majority leader is then the leader of the country as a whole.  The winning leader then “forms a new government.”  You can hear this simply by terms used to describe political chronology:  the Reagan administration vs. the Thatcher government. It can also be used to describe the party in control i.e., the Labor government, the coalition government.

While elections in the US are held on a regular non-movable schedule, general elections in the UK are more flexible.  Elections must be called at least every five years  (the date of the next general election is tentatively scheduled for May 7, 2015); however, this is not set is stone.  Two things can happen to bring an early election:  a two-thirds vote in the House of Commons for an early election or a vote of no confidence.  The ruling party usually calls for an early election if things are going well and popularity is high.  After all, if your party is ahead in the polls, why not strike while the iron is hot?  Historically, this is usually done in year four of a particular government.  The vote of no confidence is complicated, but is generally a consensus that the current government is not working and parliament basically wants to start over. [4]  Once an election is called, whatever the reason, anyone can run for office provided they submit the appropriate forms and a £500 fee. [5]  And boy do they!  In the recent Eastleigh by-election (the former MP resigned after a scandal) the following parties were represented on the ballot: [6]   

Liberal Democrats – winner with 13,342 out of 41,616 votes

UK Independent - 11,571 votes

Conservative -10,559 votes

Labor - 4,088 votes

Independent -768 votes

National Health Action – 392 votes

Beer, Baccy and Crumpet Party – 235 votes

The Christian Party – 163 votes

Monster Raving Loony William Hill Party – 136 votes.  Don’t laugh, the Loony Party have actually won some county and town seats.

Peace Party – 128 votes

The Elvis Loves Pets Party – 72 votes

English Democrats – 70 votes

Trade Union and Socialist Coalition – 62 votes

Wessex Regionalists – 30 votes

Once registered, candidates usually have only four to six weeks to campaign.  That means no high-end fundraisers, no endless television ads, and, because all voting is local, no nationally televised debates.  Politics here seems to be on a more grassroots level, with your local MP being just that: local.  Whether it is or not remains to be seen.  In the meantime, I’m dying to know what’s in that red box.

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[1] Phil Roe (Rep. T-Tenn), “Congress must pass a budget,” The Hill’s Congressional Blog, (http://thehill.com/blogs/congress-blog/economy-a-budget/277719-congress-must-pass-a-budget) 17 January 2013 [accessed 20 March 2013] and Suzy Kim, “Senate Democrats promise to pass a budget.  Why is this a big deal?,” The Washington Wonk Blog, (http://www.washingtonpost.com/blogs/wonkblog/ wp/2013/01/20/senate-democrats-promise-to-pass-a-budget/), 20 January 2013 [accessed 20 March 2013]

[2] “Guide to the Budget,” HM Treasury (http://www.hm-treasury.gov.uk/about_budget.htm)

[3] Rodney Brazier, Ministers of the Crown (Oxford:  Oxford University Press, 1997), 151-152

[4] “Parliament and Government,” UK Parliament, http://www.parliament.uk/about

/how/role/parliament-government/, [accessed 20 March 2013].  This replaces the old system (changed in 2011) whereby the Prime Minister would simply ask the Queen to dissolve Parliament without the two-thirds vote.

[5] “Standing for Parliament,” UK Parliament, http://www.parliament.uk/get-involved/elections/standing/ [accessed 20 March 2013].

[6] “Eastleigh 2013 by-election:  full results and charts,” The Guardian, http://www.guardian.co.uk/news/datablog/2013/mar/01/eastleigh-byelection-results-2013#data [accessed 20 March 2013]

Negotiating the Red Tape Jungle

It’s been nearly two months since we arrived in the UK and we are still in temporary accommodations.  It’s decent enough, but I’ll be glad when we get into a place of our own.  The problem with starting over is that you have no record of any type.  I suppose there are situations where this could be helpful. The reality is that lacking the necessary documentation can cause a dangerously circular situation:  in order to get a bank account you must provide proof of address; however, not having a bank account makes it virtually impossible to find a place to live without a great deal of money upfront.  We can prove who we are, but since we are renting a holiday cottage we don’t pay utility bills or council tax – the documents needed for address authentication.  I understand that proof of address is needed for anti-money laundering compliance, but it didn’t change the fact that we didn’t have anything to show.  Fortunately for us, the large corporation that brought us here in the first place has agreements with several nationwide banks and they were able to take care of opening our account at the corporate level.  This, as you can imagine, takes time – in our case about two weeks. 

The bank account issue reared its ugly head again when we went looking for a car and set out to buy car insurance.  We had the funds in our US account to pay for coverage; however, the system at the insurance brokers wouldn’t allow us to use our US bankcard.  (I suspect this has to do with preventing money laundering as well.)  As our UK account hadn’t been finalized our only payment option was to set up a high-interest monthly installment account.  We were able to pay the balance in full as soon as we received the cards for the UK account the following week, but it was still an unexpected hassle.  We also couldn’t take our 10+ years of no-claims discounts with us.  We’re insured as if this were our first car.  We had a letter from our agent in the US, but it didn’t matter.  No record in the UK, no deal.  The up side is that the insurance certificate was sent to the holiday cottage, meaning we have proof of address if we need it again.

Now that the bank account issue was settled we assumed that we wouldn’t run into any further problems.  We found a house we loved and submitted an application to lease it.  I thought it would be similar to renting in Columbus where we did the entire thing over the Internet.  We filled out the application and paid the fee online.  A couple days later the management company sent us the lease, we signed it and mailed it back with a check.  Process complete.  Here the process is a bit more involved.  Employer, personal, and most importantly, bank references are required and thoroughly checked.  Our references are all solid, so we shouldn’t have a problem, right?  Well, our account hasn’t been open long enough for the bank to give us a reference.  In order for the bank to verify that we regularly have enough money in our account to pay the rent, the account had to have been open and active for at least two years.  Since the traditional bank reference wasn't available the agency agreed to take six months of statements instead.  Our account hadn’t been open for six weeks let alone six months!  We thought we were going to lose the house.  Luckily our relocation company was able to step in and help because the next option was to pay six months rent up front!  That would have wiped us out.

Of course, these requirements may differ depending on what area of the country you’re in, which agency you are dealing with, and the individual landlord.  The bank requirements to open an account, however, are generally non-negotiable.  So what to do?  I found this great article on Moneyfacts.co.uk with some useful suggestions on how to open an account in the UK if you find yourself in the same situation as us.  I just wish I had found it six months ago.

The agent for the house told us that they would be putting the final touches on the lease and would have it to us this week so we could look it over.  I assumed that once we receive it that would be it – we’d sign it, send it back, and move in on the agreed date.  Nope.  In the UK you sign the lease contract and get the keys on the same day that you move in.  The same day.  I guess when all is said and done it isn't that much of a hardship, but it is one more thing for me to to worry about on the day.  In any case, we are scheduled to do all this next week.  Fingers crossed that nothing changes between now and then. 

We are fortunate that my husband's company took care of so much of the red-tape for us.  I don't remember any of this the last time we lived here, but that was a long time ago and in a much different world.  I wonder how others do it?

Bureaucracy aside, life here is actually rather nice.  Our new home is in a lovely market town on the south coast.  Stay tuned!