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I S S U E 4 9

N O V E M B E R / D E C E M B E R 2 0 2 4

CAST

Citizens Assembly South Tyneside

Now is the time for community-driven, people-powered change in South Tyneside.

News & Views

In The Spotlight:

Are national finances like

household budgets?

Cryptic Christmas...

Can regular reader ‘Sir

Didymus’ stump you?

Community Noticeboard

Citizens Assembly

South Tyneside

Contact us:

southtyneside@assembly.org.uk

CITIZENSASSEMBLYST

@stcast.bsky.social

Welcome to your

NOV./DEC.

newsletter

THE TRANSFORMING DEMOCRACY

ON SOUTH TYNESIDE PETITION

IS NOW LIVE!

At the end of November, our petition to

transform democracy in the borough

went live!

Our stall, near the transport

hub in South Shields, was

very popular and we got

loads of interest!

Read more on

page 2.

WE’VE MADE THE RADIO...AND THE

PAPER!

Seems we’re not the only one’s

interested in local democracy

(or lack of it)!

Radio Shields broke the story

first, swiftly followed by

The Gazette.

Check them both out here

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News & Views

Transforming Democracy on South Tyneside TOGETHER

Earlier in this month, we forwarded Radio Shields our press release and they were more than happy to take the

scoop - on 13th December, they broadcast our campaign interview across the borough!

CAST Chair, Dru Haynes, met with Affinity Media’s Head of News Martin Haskin at The Word to answer his

questions about our Transforming Democracy on South Tyneside campaign. We’re a little pushed for space

here but you can catch up with that interview, our press release and the Gazette article here

We’re busy organising an interview in the New Year with The Gazette following

their article on 13th December and we’ll let you know as soon as we hear

anything from The Chronicle.

Let’s get going - Transforming Democracy

on South Tyneside is now LIVE!

We kicked the petition campaign off in South Shields just opposite the transport hub but

don’t worry, we’ll be bringing it to a venue near you too! The weather was great and we had

lots of people more than happy to add their names to the call for decision-making at South

Tyneside Council to be more representative.

We got some great feedback to work with and everyone had their own reason for signing but

as long as you’re registered to vote in South Tyneside, you’re more than welcome to add your

signature!

Our new campaign website has just launched to keep you up to date on

the whereabouts of the ‘petition roadshow’ in the new year. Check it out

here - https://southtynesidedemocracy.net

You might also have noticed that we’ve made the move to Bluesky?

You can stay in the loop there or Facebook - wherever takes your fancy!

Petition must be pen & paper!

Lots of you have been in touch to ask where the link is

to sign online...oh, if only it was that simple!

Unfortunately, the legislation was passed before

online petitions became a 'thing' so we have to do it the old fashioned

way with pen and paper!

Don’t worry though, our borough-wide petition roadshow starts in the

New Year bringing the petition to you – stay tuned!

DON’T FORGET:

YOU MUST BE REGISTERED TO VOTE IN SOUTH TYNESIDE TO SIGN

You can register here: https://www.gov.uk/register-to-vote or scan

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News & Views cont.

Scan the QR or go to

https://bit.ly/3yZ3X2H

Transforming

Democracy survey update

Our online survey continues to pick up momentum -

check out these stats!

If you haven’t already, have your say in the survey.

Data correct as of 26th December 2024

Next steps?

Petition roadshow and group

signings - we’re coming to you!

As mentioned earlier, we'll be taking our petition

roadshow around the borough in the New Year. We're

busy planning it now and as soon as it's confirmed

we'll be getting details out.

But...if there are a number of you who wish to sign, we

could bring the petition to you - just drop us an email

Volunteers needed!

If you’d like to get in on the action, why not pop along?

Just get in touch and we’ll get you up to speed!

Divest Tyne & Wear ClimateReads

Using the power of words to protect our planet, safe for future generations

Current ClimateRead: Hidden Universe by Alexandre Antonelli

As the vital Climate and Nature Bill makes its way through Parliament, the head of The Royal

Botanical Gardens takes us on a journey through the wonders of the world. The loss of biodiversity

which comes with climate change (as evolution is not able to keep pace with the speed of climatic shift) is as

important for humankind as the warming itself.

How to access it:

Hardback: £13.59 (we’re looking into getting them bulk from local publisher – please email if you’re interested)

ebook: Kindle costs £9.99, Kobo £9.99 - let us know if you find cheaper!

Audiobook: £7.99

Library: we’re requesting Newcastle City Library to purchase, please approach your library as well.

Date for review: Wednesday 5 February, 6:30 - 7:30pm on zoom (email divest.tw@assembly.org.uk for more info)

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In The Spotlight:

Are national finances like household budgets?

One of the most successful ideas the Cameron-Osborne government implanted

into public consciousness was the notion that government and household

finances need to be managed in the same way.

It’s simple to understand. When you’ve borrowed too much, you cut your

spending to pay off the debt. You might be able to get a better-paid job to help you

pay it off a bit quicker but you still budget to reduce your debt over time. Going on a spending spree

today means tightening your belt tomorrow. So, it stands to reason that if the government borrows too

much, there must be a programme of austerity to pay the debt off. The government has to live within its

means, just like a normal household - if government spending regularly exceeds income, the national

debt will become unmanageable and the country will go broke, therefore this period of ‘belt-tightening’

is essential.

And, because everyone understands this reasoning, it’s become a commonly accepted belief. Spending

proposals which would help us deal with some of the issues we face – housing, infrastructure,

increasing pressure on healthcare and welfare provision, climate change and so on – are barely

considered, simply dismissed out of hand with the political and media class simply coming back with

‘living within our means’, ‘balancing the books’ and ‘paying down the debt’ or trotting out the old standby

‘where’s the money going to come from?’

Unfortunately. this view is shared by the new government under Keir Starmer. The ‘family budget’

analogy is repeatedly wheeled out using phrases like ‘the national credit card is “maxed out”’. But is it

correct to compare a household budget to governmental finances?

The short answer is no! Unfortunately, this analogy is a dishonest myth. Governmental finances are a bit

more complicated because they’re alien to the way most of us understand income, spending and

borrowing but not impossible to understand…

On the whole, (and we know this part needs no explanation!) your household has a set

income, salary, pension, benefits etc, which you allocate daily/weekly/monthly to pay

your various bills and cover your expenses.

If you find that your income isn’t enough, you can, in theory, make savings – don’t go out

as often, buy cheaper groceries, cut down on ‘unnecessary’ purchases – or increase your income – look

for a better job, sell stuff you don’t need online/car boot sales, trade in old tech etc. If that’s not enough,

then there’s the option of borrowing but…

...household borrowing is limited, not everyone has rich parents or grandparents they can turn to. Banks

and lenders cap the amount you can borrow which essentially means that once you’ve hit your limits,

you can’t have any more. If you can’t afford to pay the interest on the loan, you fall into arrears and your

creditors call in the debt which can lead to a range of consequences such as repossessions, evictions,

even imprisonment.

That’s the way most of us understand budgeting unfortunately...governmental finances are absolutely

nothing like that!

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According to the Institute for Fiscal Studies (IFS) [t]he Government raises around £1 trillion in

revenue each year. Most comes from the three biggest taxes: income tax, NICs* and VAT. Also

tipping into government coffers are income streams such as capital and company taxes, Council Tax and

business rates. Then, there’s indirect taxation - fuel, alcohol and tobacco duties etc. The rest, just over

£100 billion, is made up from non-taxation income, including things like revenue received from local

authority housing and interest paid on government resources such as student loans.

So, yes, it is true that the taxes we pay make up the majority of government income however unlike a

household, the government has the ability to raise funds in the short-term by simply raising these taxes,

as we’ve seen recently with the hike of employers NI contributions. This is not usually a popular move

however!

Just as an aside, Modern Monetary Theory (MMT), based on the 1905

theories of Georg Friedrich Knapp, argues that monetarily sovereign**

countries such as the UK which spend, tax and borrow in the fiat currency***

they fully control, are not bound by ‘tax take’ when it comes to government

spending. Basically, governments don’t rely on taxes or borrowing for spending -

they can print as much money as they need and are the monopoly issuers of the

currency. As their budgets aren’t like a regular household’s, their policies shouldn’t be shaped by

fears of a rising national debt. But that’s for a subject for a later newsletter!

So, if tax rises aren’t desirable or possible, the next step is to make savings...

Government

income is limited

to ‘tax take’.

Using the household analogy, after years of spending more than it earns, the government now needs to

‘put the finances in order’ so it’s out with the pub lunches and luxuries and in with the packed lunches

and value brands but (and it’s a very big but) governments are not like households. The savings made

by a household have next to zero impact on others, the choices made by the government have an

immense impact on the whole of society. As a household, if you cut out the pub lunches it’s unlikely that

you’ll have to increase spending elsewhere - but this exactly what happens when the government

makes cuts.

A simple example of this is the regular call for the reduction of the Civil Service. Let’s say numbers were

reduced - great - big saving made. However the government now has to cover the increased

unemployment benefit costs, not to mention any redundancy payments, until people get new jobs

(assuming the new salaries don’t need to be ‘topped up’ by in-work benefits). These ‘savings’ are also

impacted by the loss of tax take while these people are unemployed.

Then you’ve got ‘multipliers’ to consider. Will redundancies have any knock-on effects? Will they lead to

more? What will be the impact of the increased competition on the local job market? How will services

be affected? And this leads to the next point...

Another way for the government to make savings is to simply stop a particular social programme but

again this has consequences. For example, stopping funding for schemes

We can’t just

keep spending, we

must make savings.

aimed at preventing youth crime results in spending money in the future

to deal with the resultant criminals, cutting schemes to increase physical

fitness in deprived communities means higher spending on healthcare in

the future, cutting education provision leads to reduced tax take and/or

higher unemployment bills and so on.

**Monetarily sovereign: a state which has a central bank, the sole issuer of their currency (Bank of

England), which gives the government the ability to issue their own money and regulate its use within

their borders, eg. UK, USA, Australia, Canada etc.

***Fiat money: government-issued currency not backed by a physical commodity (eg. gold or silver) but

by the government which issues it. Most modern paper currencies are fiat currencies, including £, $, €.

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*National Insurance Contributions

C A S T N E W S L E T T E R | I S S U E 4 9


So, if making money and saving money is different, what about borrowing?

First of all, we need to understand that, unlike a household, the government spends its money before it

‘earns’ it. As long as there’s a legal budget, the Bank of England (BoE) has to spend whatever money the

government requires, it has no choice. The spend always comes first. If the government didn't spend

money into existence in the first place, there would be no money to pay taxes with - the taxes we pay

exist to reclaim the money that the government puts into circulation. The government doesn’t reclaim

all the money it creates however, some is left out in order for us to spend and drive the economy. If it

needs more, unlike a household, the government can ‘print its own’!

Unlike a household, the government has the powerful backing of a central bank.

If the Treasury and the BoE cooperate, the bank can help lower the interest

rate (borrowing cost) of the government and, as we noted earlier, because

the UK is monetarily sovereign, it can use the process of quantitative easing

by buying government bonds.

We can’t afford to

borrow any more

money.

In very simple terms, the BoE buys UK government debt at market rates, this scarcity

forces the price of the bonds up and profit returns down which, in theory, forces investors to

look elsewhere for better returns on their stakes. Therefore the government generates money

plus stimulates the economy which, in turn, raises tax returns. The UK government raised

around £450bn using this method during the Covid-19 pandemic.

The government has significant influence over its own borrowing costs - households do not have a

central bank at their disposal, lowering their rate of interest whenever they want to!

Households borrow to increase their standard of living. Not many people or families have the money to

pay for things up front, for example, a car or a house, we end up borrowing many times our income, and

as Dr Mathew Bishop of Sheffield University suggests, this ends up being ​’far more than any country

borrows, relative to its income, for anything’.

We’re by no means saying it’s easy - managing the finances of an entire country isn’t supposed to

be! But it’s clearly incorrect to liken government budgeting to a household. This false analogy has

been intentionally established to prevent the serious discussion of progressive spending policies.

Managing government finances isn’t simply

about compiling a list of initiatives to just

stop funding. It’s about having a plan. It’s

about managing and funding the services

we all depend on and it’s about deciding

where real savings can be made, not simply

moving the expenditure into the future by

condemning many of our communities to

deprivation.

It’s time for our politicians, and a complicit

media, to admit that this is a false narrative.

Want to have

your say?

Drop us a line

southtyneside@

assembly.org.uk

Next edition:

How viable is the call for public ownership of utilities?

Can they be made public again? What are the pros and cons?

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Thank you to CAST member Sir Didymus for creating this

little festive fancy.

Are you up to the challenge?

Scan to complete

online

Solution in Jan./Feb. newsletter

ACROSS

1 Jackson's civil war halted.

9 Only one in the trees in this cash-strapped panto.

10 Sooty '80s pop group.

11 Do German's give poison at Christmas?

14 Succeed in passing.

16 Do Merlin and Gandalf have this kind of Christmas?

17 No Christmas 'spirits' for this horizontal plane.

18 This keeps everything together.

19 Hearing test?

20 xiv lbs = a _ _ _ _ _.

22 Steinbeck's left-wing ride. (3,4)

23 Perhaps St Sales is the patron saint of these?

24 It's hard to find a bit of this Welsh toast.

28 The first to bring the tools.

29 Woman's Indian coin.

30 Annually for Kate and Emma.

DOWN

2 The Tyne Tunnel takes this out of its drivers.

3 This Christmas saint is not old.

4 Toast to the bringer of mulled wine at Christmas.

5 The Irish Dail is set out this way in the UK.

6 Alethic mixed for a moral meaning.

7 Combined sorcery and rug to get Aladdin's transport. (5,6)

8 Oral hygiene without the candy. (6,5)

12 Christmas house made from a brown loaf.

13 What a carry on to turn the sleigh round.

15 The exam on the 25th makes it irritable.

16 The past tense of Scrooge.

20 'Walking in the air' with this fellow.

21 One of the Magi.

25 Sad Tories.

26 Annoying little insect.

27 Wan quiet beer.

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CAST

community noticeboard

SOUTH TYNESIDE BRANCH OF NORTH EAST PUBLIC

TRANSPORT USERS GROUP LAUNCHES

Due to a poor response to the North East Combined

Authority Transport Plan consultations, NETPUG is

launching a local branch to ensure that we in South Tyneside

are heard on transport decisions impacting our borough.

Meeting info: online 13 Jan. / in-person 14 Jan.

community links:

just click them for more info!

Divest ClimateReads

Book Group

BIG LOCAL JARROW CIC

Based in central Jarrow, the aim is to engage people across

South Tyneside in culture, heritage, skills and making

amazing tea!

With well-being walks, tea clinics, coffee+ mornings and so

much more, check out the amazing line-up events they’ve

got going on here

The Big River Makers

Market

KEY Community Bus

COMMUNITY SUPPORT @ BILTON HALL

Many people across our borough struggle to replace broken

white goods, afford clothing or put money on their gas

and/or electric meters. If this is you, why not see if Bilton Hall

CT and partners, The Greggs Foundation, can help you out.

You can chat confidentially with Jules, who can help you

complete the application form.

All info here

GROW YOURSELF A ‘SCRAPS ALLOTMENT’!

This time of year, we get through loads of veg but did you

know that there are many common vegetables that you can

re-grow from scraps?

Things such as potatoes, onions, garlic, celery, Pak Choi,

basil, mint and other herbs can all be grown from the

scraps that would usually go in the (compost) bin.

Why not get the kids involved and give it a go!

Save South Tyneside

Hospital Campaign

WANTED!

Community Volunteers

Tyne and Wear Centre

Against Unemployment

North East Bylines

@stcast.bsky.social CITIZENSASSEMBLYST southtyneside@assembly.org.uk

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