Month: August 2010

One of the surprises of recent months has been the emergence of proposals for substantial change in the way the NHS is managed. They emerged gradually and quietly in Opposition, in contrast to the Education changes which were well heralded.

They contain two principal elements. The first is part of the general policy of cutting back the central overhead. Health, like eveything else, will have to demonstrate it is reducing the numbers of central executives, and curbing the amount of central and regional interference with the local surgeries and hospitals. That makes sense, and can be done.

The second is to transfer responsibility for “commissioning”, for selecting hospital or other treatment, from Health Authorities to GPs. This is the ultimate empowerment of the professionals, the ultimate localist move. Out will go the PCTs, Trusts of officials and part time unelected members, and in will come the budget holding GP.

I would be interested to hear your thoughts on this. Will GPs want to do this? What back up will they need to do it? Will it lead to higher quality of treatment and more patient choice?

There is something of the Nimby in all of us. As an MP I am very conscious that in many cases I am expected to be chief Nimby, to come to the aid of those who want to save a view, protect a greenfield, avoid the eorision of green gaps and Green Belts.

All the time we have a system of planning that requires a national framework and a local plan it will fall to elected and unelected officials to come to a judgement about where things can be built and how much can be built. It requires us all to avoid ducking the quesiton of where building can take place, if we take the Nimby route in many popular places.

This is becoming a big issue in many areas like Wokingham, now that more power is being transferred to Councils for local decisions. Wokingham has been one of the fastest growing parts of the country in the last twenty years, with large new housing developments going in alongside substantial industrial estates and big new food stores.

The good news is that even in a crowded place like Wokingham where opinion is on the whole very concerned about continuing with the same pace of growth, there is plenty of scope to build for growth in appropriate places. The area contains the second largest Segro industrial estate in the UK at Winnersh triangle. The Council and local opinion is happy to see substantial new and redevelopment on this park, greatly adding to the available area of property, with improved road links to the motorway network. This is now underway. The Council and others are also likely to look favourably on proposals to modernise and extend the space available on the Molly Millars estate in Wokingham itself.

For those wanting to build shops there are substantial oppotunities in Wokingham Town Centre, where there are large redevelopment sites and a Council wishing to see more space completed. The Wokingham sites would also accommodate extra urban residential accommodation where permission is likely to be forthcoming.

The question of more housebuilding is the most contentious, but even here there is one large possible opportunity. The area contains the Arborfield Garrison. There are plans to move all the soldiers to Wales, freeing many acres where the brownfields could be redeveloped with a major new housing area. The final Arborfield decisions will be made as part of the Defence Review.

Sometimes it is possible to be both a realistic Nimby and to find land for the building a growing economy needs. This search for sensible answers and compromises needs to be undertaken throughout the country as we move to more local planning.

There may be delays in moderation over the bank holiday owing to my schedule. Worry not – things will appear shortly afterwards.

More than half the issues which constituents bring to me are matters decided by the local Council, not by Parliament. In recent years there has been an escalation in representations. People are more likely to write to the Prime Minister about something to be settled in Parliament, and more likely to write to the MP about something to be settled in the Council Chamber.

If the new localism is to work well we need to persuade more voters to engage directly with their Councillors, and more Councillors to have local media personalities and to welcome more correspondence and debate with local voters. That way we can move to a world where turnout is higher in local elections, and more thought and passion is injected into local decision making.

When people write to the local MP about a matter for the Council there are three possible responses. The MP can write back correctly pointing out that he has no power to make the decision, and that interference by him would probably be resented by local officials and Councillors. He could take the matter up with the Council, and act as an intermediary with the Council, sending on their reply when it is available. He could himelf take a view on the matter and end up defending the Council’s decision to the local voters,or in a public dispute with the Council.

None of these responses is ideal, because they all have the same main drawback. The public is not directly engaging with the people with the power to make the decision in question. Localism will require stronger local democracy. Democracy requires dialogue between decision makers and decsion sufferers. Bring it on. It will be healthier than central direction, and better than a system where there are so many layers of government you can never pin down who is to blame.

The UK in the era of comprehensive state education has had very different views on school size depending on the age of children.

A typical local authority provides small schools for 5-11 year olds. This means they can be close to the homes of the parents. The Head can know all the children in the school and can do some teaching. It cuts the strain on local roads, and even allows the possibility of more children walking to school.

That same typical authority may think secondary school children should attend schools with 1200-1500 children on the school roll. This means they draw on children from a very wide area. It increases the strain on local roads. Head teachers often do no teaching, as the administrative and personnel tasks are all consuming. Whilst Heads and senior teachers would claim to know all the children, in practise their knowledge must be patchy at best in some cases. Only a small fraction of the pupils can walk to school.

The main argument for large secondary schools relates to student choice of subject, especially in the sixth form. A large school can afford a wider range of specialist teachers, offering a wider range of subjects. I think we need to ask if this is sufficient reason to justify building more of these large schools. It would be possible at sixth form stage for pupils from School A to go School B for a specialist course that School A cannot offer and vice versa. It is also possible to draw on the resources of local sixth form Colleges, FE Colleges and local universities for the occasional student who wants to offer an A level outside the mainstream.(I remember having reading rights at the local university library in the sixth form and attending some public lectures). In practise core subjects like maths, english, science, history and economics remain the most popular and can be staffed in a smaller school.

An ancillary argument is that a large school is more economic, allowing concentration of the overhead costs for a larger number of pupils. This argument, however, is not thought relevant in the case of primary education. It also ignores the fact that a smaller school can employ part time staff to carry out functions that need to be full time in a larger establishment, or can share administrative back up with other similar schools.

So what are the advantages of smaller schools? The first is they are less expensive to build, less of a major commitment. The second is a wider range of smaller schools offers more choice. The third is that in practise most pupils will come from the surrounding area, so travel is easier and transport strain and cost less. The fourth is they can develop more sense of community and common achievement. They could have a whole school assembly, and teachers and the Head will have more knowledge of every pupil.

I am not suggesting that big schools are necessarily bad schools – far from it. I know some very good large schools. I do, however, think more small schools in the mix would extend choice, and would offer some solutions to some of our problems. It represents the quickest way of expanding choice and cutting transport stress when capital money is limited.

According to punk Keynsians a large public deficit stimulates an economy, whilst public spending restraint or cuts pushes it back into recession.

In the UK Mr Ed Balls has warned that there could be an economic hurricane hitting as a result of the Coalition government’s “cuts” in public spending. In the US Ben Bernanke has pursued low interest rates and quantitative easing as the President has run very large budget deficits. Despite this, the word is that the growth reported for the second quarter of 2010 is about to be revised down substantially.

Ben and Ed have some explaining to do. Why did Germany grow the fastest of the major western economies in the second quarter, when they were running a relatively low budget deficit and announced spending cuts? Why did the Uk record reasonable growth in the second quarter when Labour had already legislated to halve the budget deficit,imposed a range of tax increases and spending cuts to capital spending and the Opposition made clear its intention to press on more rapidly with deficit reduction? Why didn’t the combination of QE and a large deficit with no immediate plan to cut it boost the US economy to the top of the pile?

We can discount Ed’s words. As a back runner in the Labour leadership contest he has to adopt more aggressive language to get some attention. The media should not take him quite so seriously, as there is little economic foundation to his UK hurricane forecast.

We need to study Ben’s words very seriously tonight. If the US does revise down its figures and if the US authorities are now very worried about a slow pace of recovery, we should expect more extraordinary monetary action. Mr Bernanke cannot cut interest rates, so he will end up printing more dollars.

Meanwhile the failed experiment with a very large budget deficit may gradually draw to a close after the mid term elections, when both Republicans and Democrats might think they need to slow the growth in the massive debt build up which current policy is encouraging. Debt can be to economic growth as alcohol is to happiness. Drink too much and you may get depressed. Borrow more and you may have a headache.

The good announcements just keep pouring out from Eric Pickles and the local government department. Yesterday he said Councils should look again at the rash of signs that have appeared all over our streets warning, advising and requiring motorists to perform in certain ways.

As a convinced localist, or course, all Eric can do is to suggest they think again. Let’s hope they do. Many Councils have fallen prey to the yellow line, red tarmac, bollard, aggressive kerb and sign salesmen. Our roads are in a constant state of flux, with endless niggling works to shift kerbs, erect bollards, insert refuges, add traffic lights, narrow lanes, construct artifical chicanes, remove lanes from operation, direct cycles to the front of traffic light queues, put traffic lights into all red sequences for traffic and re route traffic, turning two way into one way and one way into no way. Removing on street parking places adds to the numbers circulating looking for a spare place.

Much of this work fails to make the roads safer, but adds to congestion. It can make the roads less safe, leaving drivers lost as to the full meaning of the complex instructions, or forced into long detours to get back to where they wish to go. The road works themselves are especially good at adding to congestion, frustration and cases of bad driving as people foolishly try to make up for the time lost in the Council inspired traffic jam.

It would be good if Councils who claim to be short of money at least took a year or two off from all new schemes like these, whilst taking a good hard look at what they had done in the past. Then they might like to find money for reversing some of the more foolish schemes which have reduced road capacity without improving road safety.

The IFS have re entered the political row over the impact of the budget. This intervention will be seen as helpful to attempts to destabilise Lib Dems from the Coalition by claiming the poor will do badly from the Budget at a time when Labour’s main political strategy is to try to detach leftwards inclining Lib Dems from the happy union.

I wait in vain to hear from the IFS on the impact of whether a 50% income tax is competitive when we need new inward investment to the UK, more entrepeneurship and job creation. We still do not know from them what rate of CGT the think would maximise the revenue.

The Budget document covered the ground on the impact on low and high income earners. Much of the Budget debate in Parliament and elsewhere was about this very subject. Chart A1 of the Budget red Book shows that if you take all the budget measures (Labour and Coalition) the bottom 30% by income will be less than £200 worse off. The top 10% will be £1600 worse off, and the second 10% by income will be more than £600 worse off. So far, so progressive.

If you look at the table A2 it shows it as a proportion of net income. That shows once again a progressive pattern, with the top 10% worse off by 2% of their incomes, and the bottom 30% by around 1% of net income. So far, still progressive.

Nor is it just the Labour income tax changes that are “progressive”. The Coalition’s Vat increase is very progressive. The top 10% by income will lose £850 in extra VAT compared to around £50 for the bottom 10% by income, reflecting the zero VAT on many of the staple items in a lower income budget. As the Budget books states, “the top income decile will lose almost fifteen times more” from the indirect tax changes.

I am not sure why we need to have this debate again, or how there can be new shocking evidence about the impact of the Budget measures, when it was all spelt out in so much clear and uncharacteristic detail in the Red Book.

Numerous bloggers have taken up the challenge to answer my question, do you value the £10,000 of public spending which is your average share of the total? How would you like your share spent?

It is time to look a bit more at what we all get for our money. Some of you have been critical of the idea that some part of your £10,000 should go to the neighbours. In practise most of the tax paid by people in good jobs goes to other people. We have a very progressive system, which gives quite large sums to people out of work (income related benefits, social housing etc)by taking larger sums from those in well paid work.

Our system of public spending includes three types of spending. There is expenditure on current publilc services which we all enjoy – we all use the roads, have our rubbish collected, are under the umbrella of the common defence, live with the same police force and seek to comply with the same Revenue, Customs, and criminal justice system. We all pay according to our means for these items of current spending which are incurred every year on our behalf equally.

There is then public spending on public services which we may need at some times of our lives but tend not to need when we are in work and earning. The state makes provision for the young and the elderly. We pay for the young and the elderly, partly because we are decent, and partly because we have been young ourselves and hope one day to be elderly. Public spending insures us by time shifting our payments in and our receipts out of the system.

The third type of public spending is spending for the greater good, spending on others which we would never experience for ourselves. Most people contribute to social housing but will never themselves live in a subsidised house. We all contribute to overseas aid.

In each case the debate on public spending poses three questions.

1.Is too much of the given service being provided? Do we fight more wars than we need do? Do we need so many regulatory systems?

2. Is the service being supplied in an efficent and cost effective way?

3. Could we pay for it in a different way?

We have spent a lot of time on this site discussing 1 and 2 about various services. Today I want briefly to touch on 3.

Some of the servcies in Category one like rubbish collection, lesiure facilities, public entertainments and sports could be paid for more by user charges and less by direct local and national taxation. We pay for our daily bread and water by direct user charging based on what we consume. More current public services could be charged in this way. We would then pay for what we needed and not for what the public sector wanted to supply and charge.

Some of the services in Category Two could be based more firmly on the insurance or loan principle. Students now pay for their university courses from loan money which they repay only if and when they are successful in finding well paid employment. The state pension is based loosely on the insurance pricniple, where you pay in over your working life in order to gain entitlement to a pension on retirement. These are two current ways in which the state helps you time shift between spending money and paying money in. This Insurance principle could be extended, to reward the prudent and to help the state balance its books.

There will always be causes and people deserving of our financial support which will not be able to repay one day. Civil government is about making good judgements about which and how much. I woudl appreciate your thoughts on whether and how we should also strengthen the insurance principle and the pay for what you receive principle in more public service areas.

When US troops left Iraq recently, some were criticised heavily for saying “We won”. It wasn’t that kind of war. The understandable wish of young people in a dangerous job to claim their presence had been worth it, the soldier’s wish to be on the winning side, seemed inappropriate to politicians and armchair generals. Their view of the Iraqi problem had changed and become more nuanced during the period of military activity. The troops had only been there to restore order and help the new civilian power, we were told. Civil wars in a way have no victors and many casualties.

The US General and the President in charge of the overall Afghan intervention need to resolve soon what “winning” looks like in Afghanistan. The langauge has changed over the long years of the conflict. We hear less now of war fighting, and more of seeking to buttress the civilian power, more emphasis on dialogue and policing type activities and less on winning a war. Yet our troops still live in dangerous conditions, and the death rate is high. The General himself still says there is hard fighting ahead, and sees the conflict in terms of putting down an insurrection. He simplifies the world into good guys and bad guys, those who support the current government arrangements and those who use violence and other means to try to oppose them or bring them down.

The Taleban are not an easily recognised uniformed army which one day will surrender to superior Allied forces. Nor will they all melt away over the Pakistan border to avoid Allied firepower, as if that were a good result. They can move around Afghanistan freely, blend into communities, win more recruits, win over a village here with their deeds and promises, terrify another village there into a kind of support. There is no advancing Allied front line, securing all behind it for the government.

So is winning going to be bringing the Taleban into the current government process, getting them to be an opposition which uses words rather than guns? Is it going to be driving enough of them elsewhere so the violence is at a less chronic level? Can Afghanistan produce a civilian government with enough credibility and political skill to unite most of the Afghan people behind a single central government of a non violent kind? When will the people of Afghanistan themselves have the confidence and strength necessary to say to the Taleban, you cannot use violence here to further political ends? Or will more Afghans end up saying they share some of the Taleban’s views?

In these difficult conditions there is only so much foreign troops can achieve at the request of the civilian power. Forcing the pace of our exit forces the pace at which the Afghan government has to tacke what are primarily its problems. Foreign troops have to leave some day. Saying the threat of our exit is undermining the job of buttressing the civilian power implies the civilian power is too weak to do the job it needs to do.