Monday, 2 February 2015
That's not employment, its just unpaid work
I've been having an ongoing problem with the new manpower returns since their introduction. The latest twist was to get an e-mail confirmation of successful submission , despite the error below, and then followed up by a call from someone at the population office telling me in so many word that I hadn't submitted the form. I also rather resent being called client by them. Do they know in its primary meaning it refers to a dependent, one who is under the protection of another?
My ongoing problem isn't really about the technology. It is rather more about the lack of analysis or comprehension of the distinction between work and employment.
I have run my company for over 25 years, and until the recent change never had any problem with the manpower return. In the previous incarnation the return asked for data to be supplied based on hours worked (to distinguish part time and full time workers), and on a few other residency/5 year qualification etc. Simple stuff. It also was quite clear about working principals had to be included. That is the important bit, because a principal (ie an owner) does not have to have a contract with a company they own, and is not necessarily an employee. If they don't take a wage/salary or any other emolument and have no contract they cannot be an employee. That is how I have run the company for some years.
Under the new form however it is not possible to make a return for a trading company without including the details of at least one employee. It uses that terminology, and requires a social security number and the type of employment contract (full/part/zero hours). The instructions are clear that self employed people should complete the form - no problem if they are taking an income from the business. But what if the only person is the owner, and they are not remunerated or have a contract?
It gets even more bizarre if the company, as mine has, operates more than one business. In this case it seems the only way to make a submission is to be employed in each company. Goodness knows how many fake part-time or zero hour employment contracts have had to be entered by non-employed (at least in that business) principals just to get the forms submitted.
I cannot work out if the problem is a serious analysis failure, or a genuine incomprehension at the distinction between work and employment. Anyone is free to do work gratis. How can it be otherwise? If there is no pay or emolument and no contract it is not defined as employment (which is strictly the legal form of a master/servant relationship). If it were not so all those honorary police would have to appear on the parishes' manpower returns and all those charity shops would have to be filling in details of all their volunteers.
It is true that a Jersey company (not a business!) really ought to have a resident director, so there likely will aways be one person who ought to make a return of working at the company level. In fact if you read the new law on housing and employment even this is questionable for 'regulated' entities - since a non-resident director of one of those can work in the Island for 10 days, sometimes longer, without having to register or do almost any of there things everyone else does under the Control of Housing and Work law 2012. So a resident director could in fact do no work and hence not be required on the form.
If you are wondering, yes it is possible to have a business where no one is employed. Many entrepreneurs would consider that a perfect model. You can outsource almost everything. It costs of course, but it is perfectly legal to do so. If what you trade is information or documentation it might be quite feasible to do that on a web site that once set up needs no actual manual intervention. It is one reason I don't fully subscribe to the view that promoting business will increase employment. It aint necessarily so!
I can understand the desire to ensure people don't improperly slip through the system, but the administrative process really should be able to deal with the reality of the legal status of voluntary working principals. It shouldn't even require that much work on the return forms and database. The only reason I can see for collecting the data asked for is to check social security payments. However even that is not quite right since if a director is paying class 1 contributions, there is no class 2 to pay. Similarly if they over the pension age, self or unemployed there is no contribution to pay.
If my sources are correct this manpower return system was written by an outfit in Southampton. Just perhaps it would have been wiser to have commissioned one of the competent local software companies which might actually understand the local law.
Saturday, 24 January 2015
The 1 percenter next door.
Oxfam's report on wealth inequality has produced some interesting coverage. It was quite timely for us in Jersey as the Chief Minister had recently commented on the high levels of poverty locally1. The claim that the top 1% will own half the wealth of the world within a year or so is both shocking and very worrisome.
I am fully in support of the broad thrust of the report - the inequality at the extremes is simply unacceptable. Numerically the wealthiest 80 people in the world have the same wealth as the poorest 3.5 billion. It is not the same as income, though of course if you have billions in wealth , you will surely have a huge income too. There were of course some negative comments on the report, one of two of which bear some examination.
Radio Jersey covered it with a couple of guests. It was a very poor debate. The respondents conflated income with wealth(assets) and some time was spend bemoaning the tax rates on the middle earners locally. There is an issue there, but it has little to do with the global wealth inequality of the Oxfam report. It is like mistaking a balance sheet for a cash flow statement. However it does raise one of the other argument deployed by some detractors - wealth is an inadequate measure of poverty.
Certainly it is possible to be asset rich and income poor. Dairy farmers in the UK who are getting less per litre of milk than it costs to produce might well be in that position. Conversely it is possible to have high income , but no net wealth, especially if you have a 'high maintenance' lifestyle. It is half the reason some celebrity footballers and performers quickly go bankrupt if their income stream declines.
This conflation of income and wealth is one of the key points made in a derogatory piece in the Spectator. They include this graphic
Quite why they think the millennium goals set in 1990 should still be the standard in 2015 isn't explained. Nor do they appear to have heard of either inflation , or of sudden currency movements (The Swiss franc mover 30% last week! Exceptional, yes, but it happens) $1.00 in 1990 had the same buying power as $1.85 in 2014 3. Annual inflation over this period was 2.59%. Or put another way their graphic implies no significant change in the actual inflation adjusted income poverty of the poorest in the world.
The same article then goes on to make a real howler of a claim. According to the Spectator this graph show inequality is falling long term. It is true there is a drop from 2000 -2010, but even they admit there's been an 'uptick ' in more recent years. But clearly the level in inequality is higher in this decade than it was at any time in 1960's, 1970's or 1980's !
Perhaps the most valid of the problems directed at the wealth report is the impact of debt. The measure Oxfam used is effectively net assets, so people in debt are identified as the poorest, poorer than those who have no assets, but no debt. That means, for example, if you have negative equity on a house you are likely regarded as poor. However that fact hides a twist. Generally you can only go into debt if yo have surplus income over basic requirements. If you have no visible means to pay back a loan you are very unlikely to be able to secure one. Where it does prove possible for the income poorest it in place like India where bonded labour abuse is used to effectively enslave people.
Debt might also distort the picture in another way. It is quite possible to have wealth in shares that are valued significantly but in companies that have 0 or even negative net asset value. We are not talking small companies here either. Currently, for example, I believe BT has NAV of 0. It is not magic - as long as the business can service it debts it may have value. But therein is the problem It own BT shares are they count as an asset, even though they have no asset value! The company has no wealth, but if I have some shares in them I do have wealth. It looks like a paradox arising from the artificial separation of concerns between the owner of the shares and the owner of the debt.
While it is clear the top 80 have huge wealth, and the bottom half almost none, the question arises who are the one percent. The distribution of wealth follows a power law. At the higher end a small change makes a big difference. $3,500 net assets puts you in the top half globally 4. To be in the top ten percent requires around $77,000. The mean wealth of the top 1% is about $2.5million, but the lower end is around $800,000 (A little over half a million pounds).
Half a million pounds might seem an impossible sum to younger readers, but it is attainable. Someone in their fifties who has paid off a mortgage on a three bed detached house with a garden in Jersey is almost there. I don't know if the Oxfam methodology accounted for it, but social security is another implied source of wealth. Taking just the pension aspect, if you are near to claiming the age pension in Jersey you are in effect getting an index linked annuity, with full contributions, of £10,200 per year. To purchase such an annuity would cost roughly £300,000 at age 65 5. Many developing countries do not have a functioning state pension system for the poorest, who do not have the disposable income to contribute into any system. All that is before considering any employer or private pension arrangements.
A pensioner living in a mortgage free house on no more income than the state pension wouldn't strike most people as particularly rich , certainly in income terms. Yet such a person might arguably be in the one percent globally. Which makes the point that if our pensioners are wealthy, the poor globally really are poor. The other observation worth making is that it is exactly this fifty year old mortgage free cohort who attend parish assemblies and vote in our elections. Do you think that is a coincidence?
1 http://jerseyeveningpost.com/news/2015/01/03/jersey-should-not-have-such-high-levels-of-poverty-says-chief-minister/
2 http://blogs.spectator.co.uk/coffeehouse/2015/01/what-oxfam-doesnt-want-you-to-know-global-capitalism-means-theres-less-poverty-than-ever/
3 http://www.statista.com/statistics/191077/inflation-rate-in-the-usa-since-1990/
4 http://www.economist.com/blogs/graphicdetail/2014/10/daily-chart-8
5 http://www.pensionchoices.com/annuity-rates/index-linked-annuity-rates/
I am fully in support of the broad thrust of the report - the inequality at the extremes is simply unacceptable. Numerically the wealthiest 80 people in the world have the same wealth as the poorest 3.5 billion. It is not the same as income, though of course if you have billions in wealth , you will surely have a huge income too. There were of course some negative comments on the report, one of two of which bear some examination.
Radio Jersey covered it with a couple of guests. It was a very poor debate. The respondents conflated income with wealth(assets) and some time was spend bemoaning the tax rates on the middle earners locally. There is an issue there, but it has little to do with the global wealth inequality of the Oxfam report. It is like mistaking a balance sheet for a cash flow statement. However it does raise one of the other argument deployed by some detractors - wealth is an inadequate measure of poverty.
Certainly it is possible to be asset rich and income poor. Dairy farmers in the UK who are getting less per litre of milk than it costs to produce might well be in that position. Conversely it is possible to have high income , but no net wealth, especially if you have a 'high maintenance' lifestyle. It is half the reason some celebrity footballers and performers quickly go bankrupt if their income stream declines.
This conflation of income and wealth is one of the key points made in a derogatory piece in the Spectator. They include this graphic
Quite why they think the millennium goals set in 1990 should still be the standard in 2015 isn't explained. Nor do they appear to have heard of either inflation , or of sudden currency movements (The Swiss franc mover 30% last week! Exceptional, yes, but it happens) $1.00 in 1990 had the same buying power as $1.85 in 2014 3. Annual inflation over this period was 2.59%. Or put another way their graphic implies no significant change in the actual inflation adjusted income poverty of the poorest in the world.
The same article then goes on to make a real howler of a claim. According to the Spectator this graph show inequality is falling long term. It is true there is a drop from 2000 -2010, but even they admit there's been an 'uptick ' in more recent years. But clearly the level in inequality is higher in this decade than it was at any time in 1960's, 1970's or 1980's !
Perhaps the most valid of the problems directed at the wealth report is the impact of debt. The measure Oxfam used is effectively net assets, so people in debt are identified as the poorest, poorer than those who have no assets, but no debt. That means, for example, if you have negative equity on a house you are likely regarded as poor. However that fact hides a twist. Generally you can only go into debt if yo have surplus income over basic requirements. If you have no visible means to pay back a loan you are very unlikely to be able to secure one. Where it does prove possible for the income poorest it in place like India where bonded labour abuse is used to effectively enslave people.
Debt might also distort the picture in another way. It is quite possible to have wealth in shares that are valued significantly but in companies that have 0 or even negative net asset value. We are not talking small companies here either. Currently, for example, I believe BT has NAV of 0. It is not magic - as long as the business can service it debts it may have value. But therein is the problem It own BT shares are they count as an asset, even though they have no asset value! The company has no wealth, but if I have some shares in them I do have wealth. It looks like a paradox arising from the artificial separation of concerns between the owner of the shares and the owner of the debt.
While it is clear the top 80 have huge wealth, and the bottom half almost none, the question arises who are the one percent. The distribution of wealth follows a power law. At the higher end a small change makes a big difference. $3,500 net assets puts you in the top half globally 4. To be in the top ten percent requires around $77,000. The mean wealth of the top 1% is about $2.5million, but the lower end is around $800,000 (A little over half a million pounds).
Half a million pounds might seem an impossible sum to younger readers, but it is attainable. Someone in their fifties who has paid off a mortgage on a three bed detached house with a garden in Jersey is almost there. I don't know if the Oxfam methodology accounted for it, but social security is another implied source of wealth. Taking just the pension aspect, if you are near to claiming the age pension in Jersey you are in effect getting an index linked annuity, with full contributions, of £10,200 per year. To purchase such an annuity would cost roughly £300,000 at age 65 5. Many developing countries do not have a functioning state pension system for the poorest, who do not have the disposable income to contribute into any system. All that is before considering any employer or private pension arrangements.
A pensioner living in a mortgage free house on no more income than the state pension wouldn't strike most people as particularly rich , certainly in income terms. Yet such a person might arguably be in the one percent globally. Which makes the point that if our pensioners are wealthy, the poor globally really are poor. The other observation worth making is that it is exactly this fifty year old mortgage free cohort who attend parish assemblies and vote in our elections. Do you think that is a coincidence?
1 http://jerseyeveningpost.com/news/2015/01/03/jersey-should-not-have-such-high-levels-of-poverty-says-chief-minister/
2 http://blogs.spectator.co.uk/coffeehouse/2015/01/what-oxfam-doesnt-want-you-to-know-global-capitalism-means-theres-less-poverty-than-ever/
3 http://www.statista.com/statistics/191077/inflation-rate-in-the-usa-since-1990/
4 http://www.economist.com/blogs/graphicdetail/2014/10/daily-chart-8
5 http://www.pensionchoices.com/annuity-rates/index-linked-annuity-rates/
Tuesday, 13 January 2015
Privates on parade
It has not been a good week for those who hold that the private sector is better than the public for delivering services. Today we hear that the UK government wants to strip the consortium running nuclear clean up at Sellafield of its £20 billion contract. Previously the operators of the only privately run NHS hospital in the UK indicated they wanted to pull out. In both cases it looks like the operations will revert to the public sector. Both are far too important to be allowed to fail, and both cite spiralling costs as a factor.
In my opinion we should never have had nuclear facilities largely because we simply do not know how to deal with the waste properly, and it is morally repugnant to throw that burden on countless future generations. The real costs of nuclear are coming home to roost - decommissioning Sellafield is expected to take over 100 years. and I predict costs will increase even further.
Hospitals are at the other end of the spectrum - a highly socially desirable undertaking Circle who run Hitchinbrook claim they have saved the public £23million. That's similar to what NPM makes annually running Sellafield clean up operations. Of course for private enterprises that is the name of the game - making a profit. If one is not visible, or a contract has turned to a loss, they will seek to exit, possibly renege, or even go bust. It is the government, the people, who stand as the provider of last resort. It is a factor often overlooked by those who argue fervently that private is more efficient more cost effective. The Government effectively carries the insurance burden of those large private ventures that get into difficulties or fail. Just look at the banking crisis and who picked up the costs there.
Jersey has in recent times taken this private good, public meme to heart. We have incorporate ports and removed the housing stock from public ownership. It is as though none of the ministers had head of WEB and the reasons why it had to be renamed and reinvented.
Just as private is not a panacea and not always a good outcome, so public can be problematic too. The truth is that if your venture is under capitalised, if you have demotivated, under trained or overstretched staff, no matter whether you are public or private you will struggle to succeed. What is certain is that there will always be someone prepared to take a risk to make a profit, and there will always be the expectation the government will be there to pick up the bits when it goes awry.
http://www.telegraph.co.uk/finance/newsbysector/energy/11340733/Sellafield-nuclear-clean-up-firms-to-be-stripped-of-20bn-contract.html
http://www.telegraph.co.uk/news/politics/11334809/Company-running-only-private-NHS-hospital-pulls-out-of-contract-amid-AandE-crisis-and-complaints-of-abuse.html
Sunday, 14 December 2014
FinTech is no silver bullet
I was quite amused by
the recent piece I read about the CoM creating a new minister for
finance, digital and competition. I have no problem with the Island
developing a bigger digital sector. I endorse diversity as a
strategy but the conjunction of the item with the timing and other
pieces has to be commented upon.
Conversations with
former colleagues with whom I worked in the previous tech bubble made
me aware a year or so ago we are into bubble territory, rather like
the late 1990's. Stories of people pitching non existent projects and
others of companies being bought without any technological due
diligence abound. Valuations based on irrational projection of almost
meaningless metrics. I've seen it all before and it is here again. So it
is no surprise some in political circles want to jump on the band
wagon. Of course a few will make it and some fortunes will be made,
but many others will fail.
Locally the drive has
focused very much on FinTech. This is understandable and is likely
very sensible for individual companies, but it is probably a big
mistake for the Island. I want to differentiate here between the
more disruptive startup and the established support business role.
There's a need and perfectly good business to be done installing
networks, managing hardware and patching servers for local financial
organisations. That's not really what we are looking at here.
FinTech really is looking at the small disruptive start up software
company.
Whenever I have been
involved in such companies there has been a common theme to the
successful ones. They have had ample access to and understanding of
the domain knowledge and problem to be solved. Clearly locally there
is specialised domain knowledge in financial services and it makes
sense for a startup to utilise that. So what is the problem?
Risk is the answer to
that, and specifically that it doesn't really represent an effective
diversification of an already over balanced economic base. It does
not matter that the skills are different and the business model is
different the odds are that a problem in the financial service sector
locally would also be a problem for the associated digital companies.
It would be better strategically to concentrate the digital sector
on the much smaller local industries like tourism and agriculture.
There's plenty of opportunity, and some requisite local domain knowledge in both
those areas. Just look at airBNB or this list
http://modernfarmer.com/2014/02/10-silicon-valley-agriculture-start-ups/
to see just how big the opportunities might be.
I am also a little
bemused at the decision to include competition in the
responsibilities of the new minister. I can see how you might need
to do something about its lack for the finance sector when we have
seen so many scandals involving the fixing of Libor, Fx and gold
prices. However software development is a highly collaborative,
cooperative undertaking. That's one reason why people in the last
tech bubble started creating incubators and hubs. We even have on
here in Jersey see http://www.digital.je/hub.
It is a little surprising therefore to see Digital Jersey and some
others locally are promoting the Barclays accelerator. Good for
a company that gets selected, but again not so good for the Island:
“The 10 companies will be guided through the process of growing and
developing their businesses with the help of funding of up to
$100,000 from Techstars. They will have world-class mentorship from
industry experts and will be based at the London Escalator, near
London’s Tech City, giving them the optimum environment to thrive
“.
Why on earth would we
be encouraging the most promising local startups to upsticks to
London if we are trying to build a local digital economy? It makes
no sense to me. It is the sort of irrational thinking that happens
in a bubble – anything that mentions the buzzword is talked up
positively even if it is a pile of ordure.
Some relevant links
http://en.wikipedia.org/wiki/No_Silver_Bullet
Sunday, 2 November 2014
The Chief Minister designate and the environment.
Sometimes it is what isn't said that tells you most about what is happening. Read the Chief Minister designate's piece from the order paper for tomorrow's States sitting at http://www.statesassembly.gov.je/AssemblyOrderPapers/2014/2014.11.03%20Order%20Paper.pdf.
If you want the key highlight, or is that lowlight?, I have written a short letter as Chair of the Jersey Climate Action Network to send to all the new Ststes members. The second paragraph reads
In the Chief
Minister designate's statement on the order paper for
tomorrow's
States meeting the word environment does not appear
once in ten
pages. Neither does climate. Sustainable does appear
twice :
page
3 sustainable job opportunities
page
5 for sustainable growth.
The only question we need ask is whether we take that lying down, or to paraphrase Shakespear, in Hamlet
Whether 'tis nobler in the mind to suffer
the slings and arrows of outrageous fortune,
Or take arms against a sea of troubles,
And by opposing end them? To die, to sleep;
No more; and by a sleep to say we end
the heart-ache and the thousand natural shocks.
Tuesday, 14 October 2014
What is the point of Government?
Is there any more
fundamental a question as we approach a general election than to ask
what is the point of Government? Many theories and forms of
government hold that the primary purpose is to protect the members of
the society. There are differences and nuances but generally they
include protecting the weak and disadvantaged individuals from
exploitation and worse by the strong and powerful, and to protect the
society as a whole from external impacts such as invading armies, and
diseases. Personally I would add protecting future generations from
the inevitable destruction and consumption of the current generations
lifestyle, but that is not commonly included.
Having read the
manifestos for the candidates in our election, you might be forgiven
for thinking the primary function of our Government was to manage the
economy. I'm not intending to argue that here, nor am I going to
review how well (!) our Government has done based on the above
criteria over the lifetime of the last assembly.
Maslow wrote his paper
'A Theory of Human Motivation ' in 1943. In doing so he outlined a
hierarchy of need for human beings. The base consists of
physiological functions: breathing, sleeping, excretion, water and of
course food. The next layer above that, which can only really be
addressed when the lower level has been satisfied, is safety.
Included in that level are security of body, employment, resources,
family, health property. You would think on the basis of that much
quoted paper that food security would be a primary concern for
individuals, society and indeed the government. It doesn't feel
like that in Jersey.
Food security is a huge
topic in itself. There are many aspects and factors involved in
thinking about it. I have sometimes been upbraided by people when I
talk about it that I don't understand it and we would be able to
organise a mini armada of small boats to bring stuff from France if
it came to it. That is a very narrow and specific aspect of food
security entailed in emergency planning. If you are relying on an
emergency plan, you do not have security, you have contingency. Food
security is much more than just can we get over a short term
difficulty should it arise.
Appreciating where we
are in respect of food security requires some understanding of food
as an industry of many interacting parts. The old days of a
patchwork of small family farms feeding themselves and selling
surpluses locally have been long dead in much of the western world.
We have mega farms larger often than our whole island, half a dozen
seed merchants who control over half the world's seed supplies,
distributors, processors of scale like Unilever and Kraft, retailers
in the UK dominated by four big companies, wholesalers and others.
Like any supply chain it is only really as strong as its weakest link
and there are many links here that could be a bottleneck. All of
that is of course today; there is also a future thinking dimension –
changing diets round the world, loss of cultivatable land, water
stress, soil erosion, pest and disease susceptibility, population
increases.
Jersey is a small
place, minute population, surely such global issues wouldn't affect
us? I hear this little Jersey argument a lot about all sorts of
things, but I would suggest we are are more susceptible than other
places when it comes to food security. Apart from some dairy,
selected marine items and Royals, we import almost everything edible.
Probably over 95% of our food is externally sourced. In August
there was a significant debate in the UK over their food security
with the NFU worried that the UK's food self sufficiency had fallen
to only 60% ! See
http://www.theguardian.com/environment/2014/aug/07/britain-food-self-sufficiency-decline-imports-nfu
It has been used to argue for increased technology usage and GM. I
don't agree with that as a solution, but I do agree there is a
problem.
In an article in the Guardian, 10th October, Jay Rayner wrote about the declining UK self sufficiency: 'Almost all of that decline is down to supermarkets pushing deals on farmers that have made their industry financially unsustainable. The only kind of land use to have increased in the past 25 years is of farmland that is no longer being farmed. In an age of rising population and an exploding global middle class – factors that will fuel demand for 50% more food from the same amount of land by 2030 – that isn’t merely a cause for concern. It’s a catastrophe.' If 60% self sufficient Britain is concerned and facing a catastrophe, what does 5% self sufficiency in Jersey say about our near future? Clearly transport links are not the only issue. The UK is worried about food security even though they are not reliant on one port. There is a lot more to food security than its distribution.
In an article in the Guardian, 10th October, Jay Rayner wrote about the declining UK self sufficiency: 'Almost all of that decline is down to supermarkets pushing deals on farmers that have made their industry financially unsustainable. The only kind of land use to have increased in the past 25 years is of farmland that is no longer being farmed. In an age of rising population and an exploding global middle class – factors that will fuel demand for 50% more food from the same amount of land by 2030 – that isn’t merely a cause for concern. It’s a catastrophe.' If 60% self sufficient Britain is concerned and facing a catastrophe, what does 5% self sufficiency in Jersey say about our near future? Clearly transport links are not the only issue. The UK is worried about food security even though they are not reliant on one port. There is a lot more to food security than its distribution.
While we often talk of
food and food security as though there is just one entity, there are
in fact several food types that we have to consider. There is the
fresh fruit and vegetables, the stuff that the 5 a day campaign and
dietitians urge us to eat more of. They are the source of much of
the vitamins, minerals and micro-nutrients we need for health, often
with a very short shelf life or storage potential. At the other end
there are the staples- wheat , barley, rice etcetera that provide
energy dense food like bread. Typically they require special
processing to turn the raw grain into edible product. These grain products is where
the bulk of the dietary calories come from. There is the dairy sector
providing significant contribution to dietary protein. Often shorter
life products require chilling, except perhaps for the more processed
items such as cheese and UHT milk. Somewhere in between we have
frozen and tinned vegetables, processed meats, ready meals that are
the specialist domain of the processors. Some can have a long shelf
life, though possibly at the expense of taste and nutritional value.
When WHO looks at food security they focus on calories. You need vitamins etc for health and vitality long term, but without calories starvation ensues in short order. Some foods are far more efficient and effective at supplying those. To get the 2500 kCalories recommended in a day as an adult male, you would need:
Just over 2lb of modern
white processed bread or
8lb of potatoes for
same or
16lb carrots ! or
25lb lettuce (!!) or
2.5 lb steak. or
0.7kg vegetable fat.
It should be clear from
that list that what we have to ensure is supplied by way of food
security is highly dependent on the diet we are fulfilling. That in
turn affects the land area required to supply the food (ignoring sea
food elements of course). Currently the average American consumes
about 2000 lbs of food per year, which works out to about 5.5 lbs and
2700 calories per day. Very crudely eating their body weight in
food per month! Europeans are a little more moderate, at about
4lbs of foods each daily. In 1993 the FOA reckoned the minimum
amount of agricultural land necessary for sustainable food security,
with a diversified diet similar to those of North America and Western
Europe (hence including meat), is 0.5 of a hectare per person. This
does not allow for any land degradation such as soil erosion, and it
assumes adequate water supplies. 0.5 hectare is 53,000 square feet.
Some implications if that were adopted across the world are at
http://people.oregonstate.edu/~muirp/trophic.htm
However that is one extreme, and there are other diets and
assumptions that others use, eg Pimentel and Jeavons.
There was a very good
article by Simon Fairlie in the Land magazine, Winter 2007-2008
entitled Can Britain Feed Itself? He looked at the basic Mellanby
diet ,and a number of other options including permaculture, meat, and
vegan options , and the implications for land usage. “In 1975,
Britain grew 15 million tonnes of cereals on less than 3.6 million
hectares at a yield of about 4 tonnes per hectare. This was the
equivalent of 283 kilos per person a year, which is about 2,700
calories a day — comfortable enough for every man, woman, child and
elderly person in the country. The total population was 53 million .”
There are many notes
and comments, but very crudely the outcome was:
Type
|
Pop
|
Land used for food
|
Fed per hectare
|
Jersey population fed
|
Mellanby 1973
|
53 million
|
11 million hectares
|
~5 per hectare
|
~32,000
|
Conventional with livestock 2005
|
60.6 million
|
10.8 million hectares
|
~5.5 per hectare
|
~35,000
|
Conventional vegan 2005
|
60.6 million
|
3 million hectares
|
~20 per hectare
|
~127,000
|
Organic vegan 2005
|
60.6 million
|
7.3 million hectares
|
~8.3 per hectare
|
~53,000
|
Organic with livestock 2005
|
60.6 million
|
15.9 million hectares
|
~3.8 per hectare
|
~24,000
|
We can do a quick conversion to give Jersey equivalents, assuming 35,000 vergees agricultural land and 5.5 vergees to a hectare for numerical convenience.
By contrast Jeavons in
his biodynamic approach claims a sustainable (organic) vegan diet is
possible on 4000 square feet per person, equivalent to 26 people fed
per hectare. The difference between Jeavons and Fairlie here is that
Jeavons is labour intensive, hand tools only, whereas Fairlies
figures use normal tractor based agriculture.
However such figures
are not too useful on the small scale. Soil conditions, micro-climate
and seasonality all play a part. Even if you could grow your vegan
diet locally, you would still have to deal with the realities of the
hungry gap in early spring and the glut in late late summer/early
autumn. Greenhouses and glasshouses can mitigate some of that
seasonal production and diversity problem, but we have abandoned them
commercially. You need storage and processing to make pickles, jams,
chutneys and freezing other stuff. If you want to make you own bread
it is even harder. After you have dried the grain, threshed it
somehow and winnowed it you could store it for sometime as long as
the weevils and vermin don't get to it. You could mill it to flour
right away but it goes rancid in a couple of months and wont store
anywhere near as long as it does as grain. You can grind some every
day for your own use. On a hand mill it might take you an hour a day
to mill flour for a family. It is a chore – hence the daily grind.
That is all fine for a
smallholder who has a bit of land, skills and knowledge, tools and
equipment, but it wont run on a societal basis. The smallholder
family might have food security, but they are not going to produce
much surplus. It is hard work and there is very little money in it,
see
http://www.theecologist.org/green_green_living/gardening/1097217/smallholding_the_basics.html
.One of the reasons for the decline in worked farmland in the UK,
touched on in the Rayner piece and it might well soon apply here too,
is that it is simply too difficult to make a living farming.
Children who have seen exhausted farming parents working long hours
just to stand still are not enthusiastic about taking up the
challenge when there appears to be so many easier ways to make a
living. There is an inherent conflict here. In general small
integrated farming or horticulture operations are more productive in
yield per unit area than large operations, especially when sized
right to the equipment deployed. However they are more labour
intensive. I estimate that if we were to use the Jeavons approach to
maximise producing our food and diet requirements locally , we would
need about a fifth of the population involved in food production.
Even if we could produce the grain, we have only one working mill ,
and that operated part time by volunteers. The only working threshing
machine is a piece at the Pallot steam museum used as an annual
attraction.
The only options that
could provide all our food locally are the two vegan options, plus
any marine produce. Even if we were collectively happy to all turn
vegan overnight , in practice it isn't going to happen. Leave aside
what happens to the Jersey cow on a vegan island, it is simply not
going to happen on any scale, not while they are comfortable well
paid office jobs in existence. Even if you thought finance was about
to collapse and bring down the local economy with it forcing us back
to the land, there would be plenty of practical problems, starting
with simply educating and training enough people to make it work.
So we have to deal with
the reality that in Jersey we are going to be importing a significant
amount of our food for sometime to come. In particular we are very
dependent on imports for processed packaged items, meat and grain
based products. This is the area that particularly concerns me –
bread. You can freeze it , but otherwise it does not keep for long,
even when made with the Chorleywood process. Of course as I alluded
to above if you have the flour stored you could bake it on demand,
but that would require either significant commercial bakery
facilities, or almost every house in the Island home baking. We no
longer have the commercial option since CI bakeries closed down. That
closure was said to be because for price competition from imported
supplies. The remaining on island bakeries could probably produce no
more than 15% of our island's daily bread requirements, even working
flat out. As recently as the 1970's bakeries were expected to carry
over a month's supply of flour on premises to ensure supply of that
most essential of commodities - bread.
Even if we had the
storage for flour we no longer have the capacity to process it. I
cannot yet see hoards of eager home bakers baking bread daily, nor
does it seem an efficient use of energy. In fact home food production
seems to have declined remarkably. People in the UK generally no
longer cook at home – they heat stuff from packets and tins.
http://www.theguardian.com/money/2013/sep/05/home-cooking-decline-low-income-ready-meals.
Even if we had the raw materials available locally it seems a
growing army of people would not know or not be inclined to turn them
into food. There is a different weakness there. The number of
processing companies is small, and they operate a few large factory
units. The problem was brought to light most clearly with the
horsemeat scandal.
What should be clear to
readers is that our food security in the Island has been eroded
steadily over many years. It needs integrated thinking on food for a
system that works for the island, from growers to processors to
retailers to the public. Matching facilities need to be in place to
make the whole work. There is no point in farmers growing wheat
other than for export unless there are facilities to thresh and mill.
There is no point to setting up a bakery unless you have flour
supplies on hand. The evidence is we are losing it. We used to
have 40 mills in the island, we now have one run part time. We no
longer have a canning factory for potatoes and carrots - that closed
in the '70s. We have lost farmers, we have I believe narrowed our
crop and produce range gearing it for export, we have lost bakeries,
converted glasshouse and nursery sites into building developments and now we are about to lose food warehousing. Each step, each loss, has
lessened the resilience on island to provide for ourselves and
increased our dependence on others outside.
I asked at the top of
the piece, what is the point of government. In respect of food
security I would say in Jersey it has shown itself to be an
irrelevance. Yes there has been some support for farmers and for
some facilities like the dairy. It has been heavily biased towards
export activities, to the monetary aspect of the industry. Nothing
aimed at staunching the disintegration of facilities we would need if
we were forced to rely on ourselves. An no, an emergency plan is not
food security and isn't good enough. There is a price to 'cheap' food and it is the risk of no food.
For me the fact it is
the Co-op closing the on island warehouse is particularly ironic.
Until the recent sale of their farms to pay for the disastrous foray
into banking, the Co-op group in the UK was effectively the countries
largest farmer. The group had a degree of vertical integration of
supply , distribution and retail of a portion of its food supplies. That exactly parallels what needs to be done to ensure we have food
security.
http://www.theguardian.com/commentisfree/2014/oct/10/big-supermarkets-tesco-sustainably
Jay Rayner).
http://www.foodsecurity.ac.uk/assets/pdfs/1309-gfs-insight-importance-of-soils.pdf
(soil management)
http://www.bbc.co.uk/news/uk-21460452
(proportion processed food bought and food prices)
Sunday, 14 September 2014
Too small to matter?
Earlier this week a note was sent to all the usual broadcast media. That I am aware not one has commented or picked up on it. Just today I came across a piece from the other side of the world that gives a very interesting light on the contents.
Jersey Organic Association
“Small changes, big
difference” is the slogan of the Soil Association's Organic
September campaign. It is ironically appropriate to the organic
market in Jersey, for both consumers and producers. The recent
proposal from the Environment Department for ongoing support for
organic producers most definitely feels like small change.
The payment offered to
the producers is £11 per vergĂ©e split over 2 years. To qualify,
the seven or eight local producers will have to be organically
certified and supply accounts. Soil Association certification costs
a minimum £400 per year for a licence, and accountancy costs would
probably be more. For a number of those growers, the payment over
two years won't even cover the licence for a single year and for the
smallest the payment works out at less than £1 per week. In Germany
and France, annual maintenance payments for organic producers can be
900Euro per hectare, approximately £100 per vergĂ©e .
For consumers this is
also a loss. There are many varied reasons people choose organic,
but concern for the environment is one. Many of us want local
produce, knowing it has been grown to the best standards of
protection for our own wildlife, environment and biodiversity.
Already we are witnessing a decline in the area of organic land in
the Island. There will be consequences to the continued neglect of
this part of our economy. I predict that two of the local producers
will have either given up organic status, or possibly left farming
altogether, by the time the policy is reviewed in the Rural Economy
plan of 2016. That would leave local consumers with less choice.
A small change making a
big difference indeed, in the wrong direction.
Mark Forskitt
Chair, Jersey Organic
Association
I should clarify. I don't qualify for any of these payments. My land is organically certified, but I am not considered commercial, and do not qualify. Obviously I am not one of those who might go out of business as I am not technically in business to begin with !
A couple of smaller growers going out of business won't make much of a dent on the size of the economy, it wont affect tax revenues much. But just how far are we prepared to see one of the few legs of our our economy wither? How much choice are we happy to see removed from the local population.
Here's the contrast http://www.france24.com/en/20140914-food-safety-fears-see-farming-return-high-rise-hong-kong/ Hong Kong has numerous parallels to Jersey. It is one example of where we might very well end up if we continue with growth and eating away at green zone and agricultural land. They had a problem with farming becoming non-viable in the face of land prices and wages from the burgeoning financial economy. "By 1980, 40 percent of farmland in Hong Kong was reported as abandoned
and rice paddies made up less than one percent of what was in use.
Today, a total of just seven square kilometres (2.7 square miles) is
actively farmed." That's out of a total of 426 sq m, a touch under 10 times the area of Jersey.
While still flown in to the semi-autonomous southern Chinese city, homegrown organic vegetables now make up 12 percent of the 45 tons of vegetables the city produces daily." How does that compare with us? Who's looking to our future, our food security, our land and ecology?
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