Originally published June 2021.
In this very special series of exclusive articles for The Property Chronicle, Australian property legend Norman Harker reflects on his extraordinary 50-year life in real estate. He will pull no punches partly because, as he freely admits, Norman has a limited life expectancy of five years from December 2018 due to a diagnosed terminal blood cancer, which he has cheerfully accepted in preference to (in his words) “kicking the bucket without notice”. We are honoured he has chosen us to publish these brilliant, funny and incisive reflections of a lifetime in property.
Chapter 16: Why I can’t watch Nigella Lawson, Maggie Thatcher’s downfall and my financial madness
Development Land Tax (DLT) is the cause of my problems with Nigella Lawson, but oil was the root cause of DLT and my subsequent transformation to the madness shown in the lead photo.
Chapter 15 covered the introduction of DLT after oil prices rose 400% concomitant with the October 1973 War.
Christmas 1984. An especially commissioned cartoon Christmas card was sent to all and sundry – although Sundry never sends me one. I included Tax Policy Division of Her Majesty’s Inland Revenue. Her Majesty herself wasn’t on the list, because she never sent me one back the previous year. The card showed Santa, with screwdriver, driving a screw into a building labelled ‘DLT Office’. The printed message inside was the verbal equivalent.
19th Mar 1985. Budget Day in the UK at 3:15. UK Governments’ Chancellors of the Exchequer produce new and improved ways to take:-
More of their opponents’ money faster – preferably without them noticing,
and
Less of their supporters’ money slower – with maximum publicity.
I was starring as a speaker at a conference on DLT in front of 100 masochistic delegates. It was going well – they laughed at me saying that DLT was an optional tax – provided you paid the fees of Tony Johnson (who also starred) or me.
“DLT was an optional tax”
I received a telephone message and I made the announcement: “This is NOT one of my jokes. I am advised that in the budget today DLT has been abolished on all transactions contracted on or after today.”
My problem with Nigella Lawson has nothing to do with her insistence on eating from the four major food groups every day.
I, too, believe in eating from the four major food groups every day.
The Chancellor who abolished DLT? Nigel Lawson – alleged father of Nigella Lawson and Maggie Thatcher’s blue-eyed boy.
The proceeds of DLT actually reduced local taxes. Maggie’s (undisclosed) long-term aim was to completely replace local taxes (paid directly by property owners) with a simple tax per person – a Poll Tax. That was what brought about Maggie’s plunge in popularity and her eventual downfall.
Perversely or is pervertedly, it was mainly Conservative local authorities who liked the tax. They used legislatively enabled back-to-back transactions. They acquired land at current use value and sold at full development value. My mate Arthur Daley called that “a nice little earner” and of course, at that time ‘the World was MY lobster”.
After the budget, Policy Division sent back my Christmas card with the message: ‘Mission accomplished!’ My humour returned in spades. I still send them Christmas cards suggesting abolition of Income tax but so far, no equivalent result.
I practised as ‘Norman Harker & Associates’. I had a West End of London office that I shared with a great friend, Phil Newmark. The ‘Associates’ were my (notepaper-named) consultant ‘RG Edwards’, plus half a secretary, my wife, cat, dog and three horses.
A backlog of cases would keep me going for a few years, but there would be no new ones. I thought of going back to my old specialisations. I got offers from firms suffering from some form of insanity.
No! I’ll take ‘time out’! There’s two areas that weren’t covered by my original qualification – computing and sadistics. I’d bought a programmable game computer in 1982 and realised potential for valuation formula calculations.
Mine was better than the photo! I had goo-flip cassette tape storage and a thermo printer. I learned ‘Sinclair Basic’.
Aberdeen University in Scotland was looking for two property valuers to teach. I applied.
At the interview:-
Chairman: “What’s your current salary?”
Me: “I earned £120,000 last tax year.”
Chairman, (startled): “Do you realise that this position carries a salary of £18,000?”
Me: “Yes!”
Chairman: “Why accept this position?”
Me: “Two possible explanations. The first is that there’s more to life than money and… (blah blah blah).”
Chairman: “Yes! The second explanation?”
Me: “I must be mad! If I were you, I think that’s the one I’d go for.”
I got a job! The second went to a man, who became a giant upon whose shoulders the valuation and appraisal profession stands. He also became one of my greatest friends, major stimulator of thought and a major reason why I fell in love with education.
A giant upon whose shoulders the valuation and appraisal profession stands
This was Nadarajar (Nanda) Nanthakumaran, who tragically died suddenly on 3 Nov 1998. The following are just my direct or indirect products of involvement with Nanda:
- Work on Double Sinking Fund correction (1988 – 2012),
- Financial calculator routines for calculating Equated Yields and Growth Rates. (1986 – …)
- Nominal and Effective Interest conversions (1995 – …)
- Correct valuation approaches of Term and Reversions (1986 – …),
- Lotus 1-2-3 and Excel DCF (1985 – 2020),
- Accumulation approach to DCF, (2002 – …)
- Multiple IRR theory (2002 – …)
- Probability adjusted calculation of risk (1995 – …)
- Forecasting Black Swans (1995 – …)
- Understanding Excel Functions for Valuers (1995 – …)
- VBA excelfunctionbible – a purpose-driven approach to help with Excel’s 488 functions. (2002 – 2020)
- VBA-Free excelfunctionbible (Jan 2020 – …)
- Excel formula for calculating Equated Yields and Growth Rates (Nov 2020 – …)
It’s an ill wind, as they say, but I still can’t abide watching Nigella Lawson showing me how to make a perfect breakfast.
