Magazine article Management Today

Less War but More Time-Bombs

Magazine article Management Today

Less War but More Time-Bombs

Article excerpt

In the past the level of public spending was determined by a monarch's extravagance and wars. Now it is set to be influenced by the `demographic time bomb'. By Rhymer Rigby

Faced with the byzantine complexity of today's budgets, modem chancellors must look back on their predecessors' lot with envy. Public expenditure is now of a scale and structure unimaginable for most of Britain's history.

Prior to the Roman conquest, public spending was a simple affair. Social organisation extended little beyond tribal units in which chiefs collected 'tributes' from individuals and families and then spent them as they saw fit. As might be expected in such an economy, budgets neatly corresponded to monies available.

It was only with the Roman invasion of the first century AD that systematic taxation and formalised public expenditure came to a previously anarchic land. As a newly annexed and undeveloped corner of a great empire, Britain initially benefited from expenditure far in excess of any taxes levied by Rome. Its investment, mostly in roads and public buildings, clearly paid off. Toward the end 6f Roman rule, Britain provided. substantially more tax revenue than it consumed.

Significant public spending is next mentioned in Saxon times. Under the enlightened rule of Alfred the Great, up to a third of the monarch's income went to the poor. Although the Norman conquest brought a higher degree of organisation, expenditure until the late 17th century was largely governed by two factors: the extravagance of the reigning monarch and the aggressiveness of his or her foreign policy.

Greater accountability came in the wake of the English Civil War and, subsequently, the Restoration, when much of the monarch's powers - including the control of expenditure - were ceded to parliament. It was not until the late 18th century, however, with the arrival of Pitt, that the nation's finances were comprehensively overhauled. …

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