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Archive for July, 2014

It’s all over in Brazil and the trophy is leaving a South American host country for Europe for the very first time.

Germany’s 1 – 0 extra time victory over Argentina was the country’s fourth World Cup victory, and the first as a united nation. With a team built mainly of young stars, could we see the Germans dominate over the next few years, replacing the Spanish dynasty?

But, in truth, the knock out stage of the World Cup didn’t really live up to the promise that the group stage had offered – with one stunning exception. More of that one later.

With 16 of the 32 teams already heading home, those that qualified from the eight groups got ready for the knock out stages. The group winners each took on a runner up (from a different group obviously) and in the end all eight top sides prevailed. This rather unusual combination of results saw the big footballing nations prevailed in the main.

There was a noticeable tightening up in these games. Fear of being knocked out perhaps curbed some of the attacking play that was so prevalent in the opening half of the tournament. Only eighteen goals were scored across eight games, and seven of those actually came in extra time. No country managed to score more than twice.

Hosts Brazil opened the Round of 16 and were taken all the way to a penalty shoot out by Chile after a 1 – 1 draw. And the underdogs almost scored a last second winner for a major upset. But Julio Cesar’s penalty saves eventually took Brazil through.

Columbia had perhaps the smoothest passage, with eventual top scorer James Rodriguez starring against Uruguay, who were missing the banned Suarez. Columbia’s star player netted both goals, including a stunning volley that was acclaimed as the goal of the tournament.

The Netherlands were close to defeat against Mexico, but a stirring late comeback saw Wesley Sneijder’s equaliser followed quickly by an injury time penalty winner to secure the 2 – 1 victory.

Costa Rica were reduced to ten men in the first half against Greece but still managed to take the lead on 52 minutes. The Greeks eventually equalised to take the match into extra time but were unable to find a winner. Costa Rica finally took the tie on penalties.

France did not have an easy ride against Nigeria, who had most of the chances to score, but two goals in the last ten minutes eventually saw Dechamps’ men go through.

Germany did not have it easy either, being held to a 0 – 0 in normal time by Algeria. But the Germans took control and scored twice as the Africans tired, although they did manage a late consolation goal in a 2 – 1 defeat.

Argentina and Switzerland also failed to score in 90 minutes, and a rather dull tie looked to be heading towards penalties before Di Maria’s goal near the end of extra time saw Messi and co progress.

Belgium took the last place in the quarter finals with a 2 – 1 victory over the USA. Again all of the goals came in extra time, with the Belgians eventually finding their way past a brave American side and a heroic Tim Howard who made a string of fine saves.

 

And on to the quarter finals. Only eight teams were now left and that final in the Maracana was getting ever closer.

Germany beat France by the only goal of a fairly dull game, an early header from centre half Mats Hummels’ making the difference. France had chances but could not convert possession into goals and the Germans ran out fairly comfortable winners.

Brazil won the battle of the South Americans with a 2 – 1 victory over Columbia. Thiago Silva’s early opener and a brilliant free kick from David Luiz saw two more central defenders get on the score sheet before a late penalty consolation from that man James Rodriguez. The Columbians protested throughout about some robust Brazilian challenges, and it may have been an act of retribution that led to Neymar being carried off on a stretcher with a fractured vertebrae.

Argentina triumphed over Belgium through Higuain’s fine early strike, but this was another match that failed to entertain. The two sides could only manage three shots on target between them and it was a poor exit for the highly fancied Belgians.

The Netherlands needed penalties to overcome surprise package Costa Roca after yet another goalless draw. This match will be remembered for Luis Van Gaal’s unusual decision to change goalkeepers for the shoot out. But his tactics worked as Tim Krul made two saves to secure the win.

 

So the semi final line up – exactly as I predicted! – saw two clashes between South America and Europe and featured four of world football’s heavyweights. And they were to turn out to be very different games.

Brazil had high hopes of winning the World Cup on home soil. But they were taken apart and utterly humiliated by Germany in a quite incredible match.

Thomas Muller put the Germans ahead in the eleventh minute, somehow finding himself unmarked from a corner. On 23 minutes, Miroslav Klose break the World Cup scoring record with his 16th finals goal. And then the sky fell in. Toni Kroos added two more within three minutes and Sami Khedira scored the fifth just before the half hour.

After just 29 minutes of football the scoreboard read Brazil 0 Germany 5. The footballing world was in shock.

In the second half Germany eased off. But substitute Andre Schürrle scored twice before Oscar’s late strike provided no consolation at all to a nation that was already in mourning. The final score read 7 – 1. Unbelievable doesn’t go far enough in describing this result.

This was a quite stunning victory for the Germans, a sporting achievement that will be talked of for many years to come. There have not been many performances so dominant, few matches so one sided in the entire history of the World Cup.

The second semi final was simply never going to be able to follow that.

Argentina and The Netherlands played out 120 minutes of goalless, and largely tedious, football before the apparently inevitable penalties. This time the Dutch keeper Jasper Cillessen remained in goal to the very end, but he was unable to match Krul’s heroics. Instead it was Argentina’s Sergio Romero who saved twice to take his side through to the final.

 

So it was to be Argentina and Germany who faced off in the biggest football match of them all. The two nations had previously contested two world Cup finals, with Argentina winning 3 – 2 in Mexico in 1986 and Germany gaining revenge by 1 – 0 in Rome four years later.

The first half was an intense tactical battle that was fascinating to watch, even if few chances were created. Higuain was at the centre of the two key incidents, firstly shooting wastefully wide when put through by a rare German error and then putting the ball into the net, only to be correctly called for offside. The one close call at the other end came in injury time when defender Howedes hit the post with a header from a corner. He really should have scored.

The second half was again tense but with even fewer chances. The best of these fell to the subdued Messi, who had a few touches and runs that showed promise, but was closely marked throughout and unable to put his stamp on the game.  For once he found himself free in box, but dragged his shot narrowly wide of the post.

It seemed inevitable that extra time would be required to separate the teams. And the additional period saw two chances created for substitutes that would ultimately decide the game. Firstly Palacio for Argentina chested the ball too far in front of himself and was unable to beat the quickly advancing Neuer. And then Mario Götze controlled the ball perfectly to fire a volley past Romero and win the match for Germany.

There was very little to divide the two teams, and Argentina had made the better chances. But they did not have a single shot on target throughout the 120 minutes and that was ultimately to be their undoing.

Germany are worthy world champions. Athletic and solid, with flair from midfield and goals up front. A core of young players who will be around for a while aided by one or two veterans making their last big for glory. And all blended together to perfection by coach Joachim Low’s tactical nous. It is easy to talk of meticulous preparation and ruthless efficiency – but that’s exactly how the Germans conquered the footballing world.

So it’s all over for another four years. In my assessment this was a fine World Cup. The best ever? Possibly not. But still a festival of football that entertained and enthralled, with established stars and new names playing their parts.

A last word for the hosts. Despite stories of half finished stadia and chaotic preparations, Brazil did the world proud with a well organised and successful tournament. Now if they only had a few players who could show the Brazilian flair of old then the home fans might just have had more to celebrate.

 

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Benjamin Franklin once said that “in this world nothing can be said to be certain, except death and taxes.” The former may not have changed much since his time, but tax systems certainly have.

And, here in the UK, it appears that the notion of merging Income Tax and National Insurance is back on the agenda. The government has been investigating the proposal for some time now, and although no conclusion has been reached, it cannot be entirely ruled out.

There would be some merit in combining what are two very similar payments made directly from income. It would be easier and cheaper to collect, and more transparent. But, as always with apparently simple ideas, the devil can be in the detail.

And anyone who has followed Iain Duncan Smith’s attempts to merge various welfare benefits into a Universal Credit will know that the IT systems involved can be complex and expensive to set up. This also means that long term thinking would be required – spend now to save later. And that is an approach governments are generally not good at. They want quick wins, not benefits for the future.

So how do things work at the moment? Well, assuming you are employed by an employer rather than being self employed, it is usually fairly straightforward. Before you even receive your weekly or monthly wage a slice has been paid to the state in both Income Tax and National Insurance. Complex systems of allowances and varying percentage rates are used to calculate exactly how much is paid. But most people only look at the “bottom line” of the pay slip – how much cash will actually end up in their bank account.

Tax is of course a massive political issue. The link between tax and government spending will always be a key part of any election campaign. Low tax may seem good, but it means lower spending and poorer services. Better public provision is welcomed by many but it needs higher tax to pay for it. And just how should the burden of tax be split between the rich and the not so well off?

Income tax was first introduced in the UK in 1799 and was originally seen as a short term measure to pay for wartime expenditure. It was actually abolished in 1802, only to be reintroduced on several other occasions. But from 1842 it has been a permanent feature of our lives.

National Insurance was first introduced in 1911. The original idea, as the name suggests, was that contributions were to be made by workers to a fund that would then pay out if they were made unemployed. In the early days stamps were purchased and affixed to a card that was kept to prove entitlement to benefit. Paying NI is still often referred to as a stamp. When the 1945 Labour Government established the Welfare State, NI was expanded. But it was not until 1975 that it ceased to be a flat rate paid by all employees and became a percentage of income, collected along with Income Tax.

Currently for most working people the first £10,000 of your annual income is income tax free. After that a standard rate of 20% applies up to an income of £31,865. The rate then goes up to 40% and for income over £150,000 to 45%. The top rate has been much higher in the past – it was 95% for the highest earners at one point.

National Insurance is charged slightly differently. Only the first £7,956 of income requires no payment. The standard rate of 12% applies up to £41,868, but income above this level is only subject to a 2% rate of NI. This much reduced rate on higher incomes means that those on low wages pay a larger proportion than those on high wages.

There are many technical challenges in merging the two systems. How much would be tax free? What would the standard rate be? And how much should higher earners pay? There is also the position on pensioners, who currently pay income tax but not national insurance. That could be solved by giving a higher tax free allowance though.

The politics of the situation is very interesting. The Tories are the ones behind this move and it is natural to be suspicious of their motives. A cut in the amount that the better off pay would of course be a natural political move for them. But would a simpler system not make such a move more obvious? Likewise, were a more progressive government to wish to increase the amount that the most wealthy pay it could be done simply and transparently.

So is this a good idea? Well it certainly merits a close look. Simplification and a reduction in administrative costs are both good drivers. But do these outweigh the initial set up costs and the need to combine two systems of computerised records? There is suspicion that the loss of the Insurance principle would be used to stigmatise those on benefits further – although the notion that welfare payments are handouts rather than a return from a system already paid into is widely seen now. And in truth the insurance principle does not really stand up to scrutiny these days: National Insurance is pretty much a contributing to general government spending rather than a fund that pays out to the sick or the unemployed.

There is then some merit in this idea. And we should not reject it out of hand simply because it comes from the coalition government. There are many on the left who have long argued for the same thing. Designing a system that removes the regressive nature of National Insurance payments would make a lot of sense too.

There will be great debate before such a fundamental change is made. But there could be positives from merging the two tax systems that most workers pay.

 

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