Wokingham Times

It’s been a tense run up to Christmas in the Commons. I have gone hoarse trying to get the government to understand the gravity of the credit crunch, and the need for more careful handling of the Northern Rock crisis. The inflation we now have is the result of low interest rates and sloppy lending in the past – mistakes made months ago. Today’s mistakes by the Bank and Treasury are the other way. There is too little lending and too little money available in the months ahead, which threatens house and commercial property prices, job losses, closures and bankruptcies. I have been asking for some action in the markets to ease the squeeze.

The Opposition has been pressing for a referendum on the EU Constitutional Treaty. The government said that it would let Parliament decide instead of the people. When we pressed for a vote on whether the Prime Minister should sign the Treaty or not, Parliament was denied one! The PM signed the Treaty a few hours late without a single vote being cast in Parliament, let alone in the country, in favour of such a course of action.

I have offered a fall back way of handling the Northern Rock crisis. I would be happy if a buyer does emerge who will take responsibility and offer to repay the loans made by taxpayers, but there are worries about whether one will complete a transaction. I oppose early Administration, as it would be difficult selling off all the mortgages and other assets in these conditions at a discount, threatening to realise less than we need to pay off all the creditors including the taxpayer, after accounting for the big costs of such an administration. Administration is clearly not in shareholders interest and prevents them leading a recovery of the bank and its business. I do not think the taxpayer can afford to nationalise the bank. . It is bad enough having up to ??30,000 million of taxpayers money at risk. Why on earth would we want to put ??110 billion at risk? How would we pay for that?

Plan B, if a bid does not succeed, is for the Bank of England to act as a stern bank manager setting clear repayment dates for tranches of loan, and demanding the bank use much of its cash when generated to repay taxpayers. This process can be phased, to allow recovery in the market for mortgages before Northern Rock needs to sell them on to repay the taxpayer, and giving shareholders and managers the chance to make a success of the business . The Bank of England should take all the security it can, and then manage the loan well.

This is a heavy agenda a few days before Christmas, but these issues are pressing now. How they are handled will determine how prosperous and successful our New Year will be. In the meantime I wish you and yours a very happy Christmas. My Christmas message is more in the spirit of the holiday!

Ignorance of the law is no excuse?

As a legislator I have a confession to make. I do not read all the laws that are rammed through Parliament – there are too many of them. I do try to read all the Acts of Parliament brought before us for debate, but these days those Acts of Parliament are just the beginning. Once passed, they allow the government to go off and legislate in detail about that topic, pushing through Statutory Instruments that often are not debated at all in Commons. Many of them are put out in the summer when Parliament is not allowed to be in session, and many of them go through without a word in anger being said against them. Reading the Acts themselves does not leave me well informed about our law – I would need to read all the secondary regulation, sometimes put through a year or more after the original Act.

Many MPs do not even read the primary legislation we are putting through, because it is often abstruse, and vague, leaving much to be decided in the regulations that follow. Because this government limits the time available for debating all Bills automatically, the Commons these days tends to concentrate on a few items or controversies over each bill which might make it onto the media. The detailed work of scrutinising each line of legislation is left much more to outside lobby groups, consultants and advisers. Bill committees can only get so far in the time available, and only by considering the original text. Very often the government ends up with large numbers of amendments at the very end of the Parliamentary process, as by then the outside interest groups have woken up and explain why the law as originally conceived will not work.The Bill we agree to on Report and 3rd Reading may be very different from the Bill considered in Committee.

If even the legislators themselves have not read all the laws, let alone know their contents, it is expecting a lot that busy people trying to lead their normal lives should also know all the laws. There is simply too much law, and too much pettifogging law. Time was when Acts of Parliament were shorter, when there was less regulaiton on top of the Act, and when the principles that underpinned the Act were understood by many.

Today it is more difficult to guess what the law is from first principles, because so much of the law is bureacratic and silly, often achieving the opposite of what it sets out to achieve.

It is still the case that ignorance of the law is no defence, but I have increasing sympathy with generally law abiding people who simply had not got round to reading the reams of legislative paper being churned out by Brussels and Whitehall which might affect them and their businesses. It is easier for large companies, because they can afford expensive staff and consultants to alert them to relevant changes. It is a nightmare for small businesses, where entrepreneurs have better things to do with their time than become experts on EU directives and UK Statutory instruments.

The legislative factories are too efficient at churning out lots of law, but useless at producing good law which is clear, simple, and meets with general support. One of my main grievances with the EU constitutional Treaty is that is designed to make it easier for 27 countries to produce more laws. It is called institutional change to allow decisions to be made. Why one earth do we want more laws? Isn’t everything wicked – and quite a few things that are not – banned and regulated already?

If legislators are to read the laws they pass, and if the public is to have some chance of knowing what the law is, we need to get back to less law and better law. The EU model is based on ever more complicated controls and needless interference.

Too much law means a cowed people, unsure of what the law says, and hesitant about doing things and making decisions. Too much law is the enemy of enterprise and risk taking. Too much law means the talented go into the law and bureaucracy, where the easier returns can be made. Too much law makes life a misery.

Better government means less government, concentrating on those things that matter where a sensible law fairly enforced can make a difference.

Bali – the morning after

Some papers tell me the world has changed, that giant steps have been made to saving the world.

Meanwhile, this morning the frost is so cold I will have to run the heating for longer. It’s 8.47 and I still need the electric llights on as it is dark.

I have not heard from Mr Benn about how the UK will suddenly turn from increasing its carbon output – as it has been doing in recent years – to cutting it. Maybe he hopes the credit crunch will get out of control, for a recession would lower our collective carbon footprint.

The Bali people could have saved their journey and waited for a meeting attended by a new President of the USA who may like them enjoy such junkets and be prepared to sign up to all sorts of cooling words.

The issue is, how does any of this change our behaviour?

A better class of criminal? 16th December

Although Labour in so many areas has been all spin and no do, they have been revolutionary in their approach to crime and policing. They set out to greatly increase the number of criminals, by widening and deepening the criminal law, creating many new offences, and changing police priorities.

When they came power they inherited a world in which the public thought there was a hierarchy of crime that should be tackled by the police and prosecuting authorities. These included:
Murder (including terrorism),
Stranger rape,
Other violent attacks on people,
Break-ins and burglary, and
Criminal damage to property.
People expected the authorities to share their concerns about these crimes, and to order their priorities for investigating, charging and prosecuting accordingly. The vast majority of homeowners and people in work saw the police as their allies and wished to help them do a difficult job. There was a trust between the police and most citizens.

Labour set out to change all that. They decided to criminalise the hard working and the law abiding. They decided to set death in accidents alongside murder, seeking to inculpate drivers, railway executives, construction managers and others as similar criminals. They hassled to introduce corporate manslaughter as an offence, although they were reluctant for it to apply to parts of the public sector. All sensible people are worried by the large numbers of people who die on the roads, who might die in a train crash, or who are killed at work. We all welcome steps to reduce the numbers. We do not, however, think private sector Directors and managers regard deaths in such circumstances as just part of the price of delivering shareholder value. The company leaders I know want to prevent accidents like everyone else as most of us share that common human instinct to prevent harm. Such a feeling is reinforced by the fact that it could be their loved one or relative involved, and it is not good business to kill your customers. It is therefore strange for Labour to try to create some kind of equivalence between such deaths and murder, the thing people fear most.

They decided to set date rape alongside stranger rape. Again, none of us want men to rape women, but there is a difference between a man using unreasonable force to assault a woman on the street, and a disagreement between two lovers over whether there was consent on one particular occasion when the two were spending an evening or night together. Labour’s doctrine of equivalence has led to jury scepticism about many rape claims, in situations where it is the man’s word against the woman’s and where they had agreed to spend the evening or night together. Young men do not want to have to take a consent form and a lawyer on a date, just as young women have every right to go on a date and to say "No", having it respected.

They decided to elevate speeding into the role of serious crime, on the false grounds that speeding is the main cause of accidents. Their own research shows that speeding is a factor in under 10% of all accidents, and that deaths and serious injuries on the roads are much more likely to be caused by acts of dangerous driving, by drivers using stolen vehicles, and by drivers under the influence of drink and drugs after a night out. Speeding brought two advantages for them. It could be policed by machines, as Labour put speed camera after speed camera into place, and it was bound to catch a very large number of otherwise law abiding people. Simple observation showed that most people drove at well over 70 on a motorway, and many at more than 40 on dual carriageways where the speed limit was set. It was an easy way of collecting more revenue from fines, and bringing in a whole new army of criminals.

They decided to create a range of new white collar crimes by regulating more and more. Ironically they also decided to bring in similar new regulations for the political class themselves, exposing politicians to the same kind of risks as managers and administrators in pensions, financial services, and a whole range of other services. They have succeeded in making many normally law abiding people worried sick about whether they have complied with everything they need to comply with, and have ensnared some into violations through ignorance or oversight.

They decided to elevate thought crimes to a more serious position than some crimes against people and property. I agree with the government in condemning racial abuse, religious intolerance and incitement to discrimination or violence. I still think that crimes of racial and religious hatred are far worse when violence is added to unpleasant words. The development of a much more extensive law code seeking to control what people say does not necessarily control what they think and do, but it has made the largely law abiding majority very nervous about saying what they think. It has also made intelligent political debate about issues like religion and immigration at times impossible.

Now that Labour has decided to rat on the police pay settlement recommended by the arbitrator there is ill will between police and government. I have sympathy with the police. If you join a no strike profession, and agree for your part to abide by an external body to decide your pay, you should expect the employer to do the same. It is unpleasant to see that someone is briefing, presumably from the government side, that the police are currently unpopular, as if that were a justification to pay them less. Any sensible analysis would show that what is unpopular are the priorities this government has set for our criminal justice system, and the wide increase in the number of offences and the number of potential criminals that has resulted from these changes.

To restore trust in the system we need a government that pays the police whatever the independent review body recommends, and reflects public priorities for policing in its law codes.

To Labour who have deliberately misrepresented this piece, let me repeat: I wish the law to protect women from rape, as all sensible people do, and made it clear that any woman has a right to say "No" which should be respected. I have drawn attention to the large number of cases where courts decide no rape has been committed. These are clearly not the same as rape and must be harrowing to all involved. As some people seem as determined as a silly Labour Minister to misrepresent this piece let me again make it clear that I condemn all rape and wish to see all rapists successfully prosecuted. No force should be used in any circumstances. The issue is so-called "date rape" where the courts judge there was no rape at all.

Bali nonsense – the BBC just loves EU spin

The reporting by the BBC has hit a new low of idiocy. To them there are good guys who want targets and bad guys who do not want targets. They seem to rely on EU spin, out to portray themselves as the new powerful good cops, taking on the bad guys, the US.

So let us examine what has in practise happened. The world currently has targets under Kyoto. Some of the EU good guys? who signed up failed to hit their targets, but strut the stage with moral rectitude because they agreed to targets years ago. Some who signed targets to cut their carbon output have done so, partly by closing down heavy carbon producing industrial activities and importing the goods from India and China instead. Some of the bad guys who did not sign up to targets have controlled their carbon outputs better than the good guys in recent years. Last year, for example, US carbon output was under better control than the EU’s.

All this implies that targets themselves are not the answer. Ultra greens conclude that therefore the targets next time round must be made binding with sanctions. A lot of countries, including Japan, Canada, India and China will say No? to that, as well as the USA. It would be surprising, therefore, if the mandatory target approach is adopted, and if it is adopted by only some countries by definition it cannot work for the whole world.

Even if the whole world could be made to sign such a proposal, for an individual government in 2010-14 it might still be better not to impose draconian measures to cut energy use in order to hit a target for 2020, as many of the measures that would be needed will be very unpopular with electorates. Some governments in such a regime might decide ignoring the problem and leaving any fine to a successor government was the least bad way of matching the public mood.

Nor do targets deal with the problem that the richer countries accepting them can meet them by exporting energy intensive activities elsewhere. This is likely to happen anyway, and explains India and China’s reluctance to accept any target reductions, as they will be the places producing the exports. Without India and China in the deal it is a nonsense. Nor should we expect developing countries to forgo the pleasures of using more energy per capita that the west takes for granted, as they succeed in generating more exports and more income.

When you look at the problem like this, you understand that it is not a simple case of EU right, US wrong. If the EU had its way and imposed targets, it will not reduce the world’s overall output of carbon, because the developing world will take up the slack from cuts in the developed world, and some of the developed world will fail to hit targets, as EU countries have proved during the Kyoto period.

Instead of dividing the world into good guys and bad guys, the EU should grow up and try to understand the problem. Instead of trying to unite the world against the USA, the EU and others should seek to harness the power of the US to taking action to cut energy dependence (a concept even the Bush administration understands and could support).

This long, bitter and carbon intensive conference has made the world’s CO2 problem a little worse as a result of all the extra flights, and the all night lighting and cooling in the conference centre and hotels. It was only a conference about another conference. It was sherpas preparing a way for a summit, but a conference of very numerous and rather grand sherpas. It is difficult to see why more of the preparation could not have been achieved on the emails and the phone, less carbon intensive technology. It all goes to show that our political masters still love overseas travel at our expense.

If the world wanted to do something positive to curb carbon output, it needs to concentrate less on targets and more on technology and incentives. There was discussion of that at Bali. We are not allowed to hear much about it from the BBC, unless it can be fitted into the good guy EU versus the bad guy US script. Fortunately the Indian proposal for technology sharing came along which filled the bill.

The good news is the conference is now over. Once the jet fuel has been burned to get these delegates home for Christmas, we will not have to watch or listen to more BBC people complaining of how late they are working, and telling us that the US is the only country out to wreck the planet. The truth is that if carbon does wreck the planet we are all doing it, not least all those BBC journalists burning the oil in the early hours to send us their distorted portrait of what is going on. The truth is that nothing important has happened at Bali. It will all look very different when they do it all again with a different US President. The so-called deal on technology sharing, presented as a victory, is just a few words on a piece of paper. The reality is different, as most of the technology is owned by private sector companies who will need incentives to share it.

Bali idiocy. Mud slinging will not stop the carbon.

EU members have shown their worst features at Bali.

The EU lectures the rest of the world on the need for targets, whilst several of its members will not hit their own Kyoto targets. Others like the Uk are allowing their carbon to rise after a good start at reductions years ago.

It thinks it is better to sign up to targets it has no ability to hit, instead of being honest and refusing to sign up to the targets in the first place.

It personalises its disagreements to the USA, when Japan and Russia are also against new tough targets, when Australia appears reluctant, and when India and China are standing apart from any idea of mandatory targets.

The EU should grow up, and learn that if the world is to reduce its carbon output it requires goodwill and understanding on all sides, not a combination of bullying and vain posturing. We will not cure the world’s CO2 problem unless India and China, Japan and Russia are involved as well as the USA.

The problem surrounds the belief in targets. There is a target to cut hospital acquired infections in the UK. I am sure all involved want to hit it. They do not stamp the diseases out, because they have spent all their energies on posturing and target setting, and not enough time working out how to solve the problem.

The world is in danger of being forced into the same nonsense over carbon output. Journalists should ask the people who want tough targets how they think they are going to be hit? Then they should ask why the things needed to hit the targets are not already been done anyway, as these same governments always tell us this is the most serious crisis facing mankind.

If we are to curb our carbon output we need to incentivise countries and people to do so. We need to sit down and discuss how we can share technologies and apply new ideas to cutting carbon output. Governments need to provide a lead, showing how they themselves can cut their own carbon footprint. I have had little response from the UK government to the long list of energy saving proposals I sent them. I recommend energy efficiency because it saves money and reduces our dependence on imports. The UK governemnt is well behind best practise in industry.

These governments also need to show some humility about the limits to their powers. They do not yet control every pensioner’s thermostat and every family’s oven. Until they do so they cannot guarantee to deliver a given figure by a given date.

They will not win the carbon war by going off to exotic locations by plane in large numbers, staying in classy air conditioned hotels, and having flaming rows with each other. Why should the rest of us have to pay for that? Why should we cut our own travel, heating and use of electric appliances, when our political masters do exactly the opposite? Why should we regard Al Gore as a role model, when we have seen his own large personal carbon footprint planted on the world?

I would take all these posturing governments more seriously on this subject if they showed some restraint. If they looked as if they were trying to get on with each other, to shorten the meeting and avoid the need for another carbon intensive junket, they would have more chance of getting the rest of us to follow. If they practised what they preached they would command more respect.

The BBC of course as part of its daily climate change propoganda just assumes the EU is right and the USA is wrong on all this. Even if that were true, it is not the way to get the world to an agreement. They should stop rowing about targets and get on to discussing what practical changes could be made so that people would be willing give up their carbon generating activities, or replace them with better technology to do the job.

The Prime Minister’s busy day

It is never easy when you are double booked – you can end up satisfying no-one.

Of course the Liaison Committee of the Commons would have changed its date to question the PM if asked. The fact they were not asked implies that Gordon Brown planned to leave signing the EU Treaty to Miliband. When pressure was applied, he decided he had to do both. The EU was insulted because the PM did not appear at the official ceremony, and Eurosceptics were angry because he gave in without seeking the approval of either people or Parliament.

I am all in favour of the PM taking the Commons seriously. I am glad he turned up to answer questions from Committee Chairmen. I would think he meant he takes Parliament seriously if we had enjoyed a vote on whether he should sign the EU Treaty before he signed it. What is the point of Parliament debating it and voting on it now he has committed us? We know we will be told we are not now allowed to alter any part of it. We know the government’s majority will be used to steam roller it through, with the Lib Dems helping drive the roller. All those who voted UKIP or stayed at home because the Conservatives were not proposing immediate withdrawal from the EU should be kicking themselves now. The Conservatives are the only party voting against this Treaty and for a referendum. Pity there are so few of us.

The PM would have made himself a hero with many if he had refused to sign the Treaty and had demanded the retention of vetoes or a better deal for Britain when he took over from Tony Blair. He had spun that he was far more Euroscpetic than Blair. He told the press he hated these grand EU gatherings, and saw much of the EU back slapping as a needless diversion from important matters at home. It is a pity he did not remember this when he became PM. That explains the savage change in press attitudes towards him.

The most revealing answer he gave to the Liaison Committee was when he said he now spent more time reading the newspapers but less time enjoying them. That tells us that he is just as much a slave to the media as his predecessor, thin skinned and concentrating on the wrong reading materials. He should remember Margaret Thatcher’s advice to senior collegeaues – "Don’t read it" – when the press wrote unpleasant things. She was told daily what the thrust of criticism was in the press, but did not usually spend her time pouring over different editions. She did not hold meetings to deal with press stories – only meetings to deal with real problems which sometimes might also be appearing in the press.

As a Minister myself I spent little time reading newspapers, as I had so many official papers to read and write, and so many people to talk to. If I was doing my job properly I knew more about my subject than the press knew, so I did not need to waste my time catching up with the newspapers. If the newspapers ever knew more than me about something within my government remit, then I had to make sure we caught up quickly! This bunch of politicians are too reactive, too slow, and spend too much time on dealing with the media. By the time it’s in the media it is usually out of control. That’s why the departments are so badly run. Whilst Ministers read newspapers, officials put data on discs and send it through the post, and lend ??30 billion to a bank without setting proper repayment and security terms.

Credit Crunch-the Regulators are also to blame. Boom and bust central banking.

The Central banks concerted action is a move in the right direction, and better late than never. It is part action and part spin, as it is designed to rebuild confidence to get banks lending to each other.

The reason they will not is that they are all worried about meeting their regulatory requirements.

It was the capital requirements placed on banks by regulators that led so many of them to bundle mortgages and other loans up into special vehicles and funds, and spread them around the market. Under the regulators’ rules this enabled banks to lend more with less capital. Encouraged by very low interest rates, they did this on a huge scale, with the regulators watching them and saying nothing. The regulators should have limited the amount of this lending by scoring it differently for capital purposes, or by demanding a more prudent valuation of the packages.

When interest rates were hiked by the Central Banks in the US, Europe and the UK, this started to undermine some of the loans made to individuals who struggled to pay. This in turn undermined the value of the packages of loans spread all round the banking system by regulatory requirement. This has now led banks to need to husband their own cash, limit their new lending and try to tidy up their own balance sheets, to offset the large losses they are having to report. No wonder they do not have money to lend to other banks. Now the regulatory system is doubling up the impact of the higher interest rates, and making banks sit on cash instead of lending it.The Regulators are effectively tightening after the damage has been done.

This is a massive disaster for the world’s regulatory system for banks, made far worse by the lurch of the Bank of England and the other main Central Banks from boom to bust in their approaches to interest rates and monetary management. The Fed has been more decisive in trying to correct for too much tightness. The Bank of England is still a long way behind the plot.

It is high time there was proper recognition of the crucial role played in this sorry story by the regulators. They designed a system which powered huge off balance sheet lending. They allowed it to be valued on a favourable basis with relaxed capital requirements on banks. Now they are doing the opposite, at the very time when they need to relax a bit to get banks able to lend to each other again to keep the system going.

There is at the moment a fashionable syllogism:

Regulation is there to prevent individual banks crashing and to prevent system failure

We have a tightly regulated system which has just witnessed 2 German banks and 1 UK bank get into trouble, and has witnessed a freezing of the markets

Therefore we need more regulation!

This is another area where we do not want more regulation. It is an area where we need governments to show some skill and some understanding of where they are in the credit cycle. At the moment we have boom and bust governments, allowing skewed regulatory requirements when money is too loose, and threatening too tight a regulation when money is too tight.That is the way to make a bad situation worse.

Death of democracy day

Today the Prime Minister will sign away important powers of self government from the UK to the EU.

At least we have forced him to do the deed himself with cameras to record it for posterity.

This Treaty sacrifices more vetoes than any predecessor Treaty. It helps create an EU foreign policy. It reinforces EU moves to its own defence and criminal justice policy. It gives far too much power to the central EU institutions, to be exercised in an undemocratic way.

Not a vote has been cast in favour of such treachery.

This week we were allowed a debate on European matters. The government again ruled out the referendum on this transfer of powers which they promised before the last election. They made that promise because they knew the transfer of power was unpopular, and they wished to avoid debating it properly in the General Election. They kept saying in the Election there was no point in discussing the Treaty because there would be a full 3 week campaign and vote on it on another occasion.

The government’s case, put by the chief butcher of our freedoms, Mr Miliband, was that Parliament will decide. He claimed that is right way to do it in a Parliamentary democracy.

I and other Conservatives pointed out in the debate that if Parliament is to decide, it has to have a vote on this Treaty before the Prime Minister signs it. Miliband denied us that vote this week, tabling a motion on the adjournement, and refusing moves by Bill Cash and others to debate a proper motion on whether to ratify the Treaty or not. It makes a mockery of the government’s claim, that Parliament will decide, and that Parliament matters.

The government’s offer of around 20 days of debate on the Bill to put the Treaty into practise is cynical and crude party politics, not democratic procedure. They hope 20 days of debate on the EU will allow them to brand Conservatives as fixated about the EU which does not emerge high up voters’ list of priorities. Every time we table an amendment of substance to reduce the impact of the Treaty we will be told that it cannot be allowed because the Treaty is done, dusted and signed. It will be 20 wasted days, with the government majority used to steamroller through a disgraceful Bill that the British people and their elected representatives have been denied a vote on.

This should be remembered as the death of democracy day. This is the day that the UK accepts an undemocratic Treaty which even contains powers to avoid these difficulties in future when the EU wants to grab more power from us.

Reading Evening Post

Incompetence has become the middle name of this government. Incompetence at Revenue and Customs, losing many bits of data, culminating in the loss of personal records for 25 million people. Incompetence at DEFRA and the Environment Agency, unable to keep the drains and ditches clear or to use some JCBs to dig land drains capable of taking all the water their developments rush into inadequate pipes. As a result we had serious floods this summer and watch nervously every time we have heavy rain. Incompetence at a government laboratory complex letting dangerous disease escape into our cattle. Incompetence at the Home Office, unable to control our borders properly or to keep records of who has legally entered the country. Incompetence at the Health Department, where hospital acquired infections stalk the wards of many NHS hospitals. You name a department, and they have made blunders.

The incompetence that worries me most because it will damage so many people is the incompetence at the Treasury and Bank of England. The bungled rescue of Northern Rock has left taxpayers with a staggering ??30,000 million at risk. Each adult has now been forced to lend around ??700 to the distressed mortgage bank. Our Chancellor refuses to tell us how much security we have for this money, or when Northern Rock will start to pay it back.

The Monetary Policy Committee of the Bank of England kept interest rates too low for too long in recent years, partly because Gordon Brown changed the target before the last election in an effort to keep rates down. As a result we have had more inflation than is desirable.

In October and November the hapless Committee was making the opposite mistake, keeping rates too high for too long. The results are becoming quite obvious. House prices are falling. Commercial property prices are falling. Mortgage advances are down. The money markets have seized up. Today’s problem for the banking sector is tomorrow’s problem for everyone else. It will mean less money in circulation as less borrowing is transacted, which will then reduce sales and jobs.

When Gordon Brown altered the Bank of England in 1997-8 he made a dog’s breakfast of it. He wrongly said he was making it independent. Instead he stripped it of its powers to run the government debt, and to supervise the daily workings of the clearing banks. This left the Bank distanced from the money markets it is meant to run. Because the bank does not see all the business in the way it used to it has lost its feel for the markets.

He also imposed the rickety tripartite structure on us to deal with banking crises. The Bank shares responsibility with the Treasury and the Financial services Authority. This summer they bickered over what to do about Northern Rock instead of getting on and solving it. We now know this does not work, as the three regulators together were unable to work out a solution to the Northern Rock problem, even though they knew the difficulties a month before the run on the bank began. When the Bank used to do these things on its own runs on banks were avoided, and money markets were kept more liquid.

Why is all this happening? It is happening because this government believes the business of government is amusing the media, and spinning stories. They still do not seem to have grasped that a Minister’s job is primarily supervising, leading and checking the work of his or her Department. It is detailed, voluminous hard work. We pay these Ministers large salaries. It would be good to start getting some productivity out of them for all the privileges they enjoy.

The Treasury could start by restoring the powers to the Bank of England they need to run the money markets and to regulate the banking sector properly. The Chancellor could follow that by apologising for the idiotic speech he made just before the run on Northern Rock when he said any problems for the banking sector served them right and there would be no bail-outs. He should instead say he is worried about the credit crunch and has instructed the Bank to take any measure necessary to restore liquidity and order to money markets. If he does not, if he continues to dither, more damage will be done to the economy needlessly.