Balance of trade affected by change of accounting

The January trade figures were disappointing, showing a marked fall in exports to the EU which has caused some concerns by those who did not study the figures. The ONS has decided to change the basis for compiling the import and export figures, and by its own admission there was a one off hit to reported exports to the EU by delaying the dates of record.

During the first year after leaving the EU customs union both exports and imports were higher for non EU than EU. In the first half of 2021 we had a welcome balance in total trade, with a strong services surplus offsetting the usual large goods and food deficit. EU trade continued to be in deficit and the rest of the world in surplus. In the second half the trade deficit we were used to in the EU returned, with a total deficit of £24 bn for the six months. The top five imports are vehicles, medicines, gas, non ferrous metals and oil.

The strains on the balance of payments will increase this year given the high oil and gas prices. It  underwrites the need to extract more of our own oil  and gas. The government has said it has now shifted policy on this and I  look forward to the executive decisions being taken to make this a reality. The UK offsets a substantial part of the vehicles deficit by strong exports of UK made vehicles mainly to non EU markets. It will be important to invest in and retain a strong car industry as EVs become more common. It should be a welcome challenge to the UK motor  sector to seek to make and sell attractive products to home consumers  that can substitute for the high volumes of EU  vehicles still coming in.

The balance of payments was still sandbagged in the last quarter of 2021 by a large £5.8bn payment to the EU. One of the big balance of payments wins from Brexit will be the ending of these payments. It is a pity the UK offered such an attractive deal to the EU on payments after exit, as this has slowed down getting the benefits.

 

Cost of living

Dear Constituent

This month the price of gas and electricity will shoot  up, following a period of price control. I have been arguing that the government does more to help offset the impact of these higher bills on living standards.

I was pleased the government did offer a reduction of Council tax to many. It adopted the advice I and others offered to make a cut in fuel duty and to remove VAT from green products that can help cut energy use and bills. It  has sought to delay some of the rise in bills. In the Spring Statement it raised the threshold for National Insurance, abating some of the impact of the National Insurance rise the government is imposing.

I do not think this is sufficient offset so I am pressing for more action. I wanted to see the cancellation of the National Insurance rise and the removal of VAT on domestic fuel.

I am also pressing for changes to energy policy to increase the supply of domestic energy to ease some of the shortages. I am hoping some of my proposals will be included in the Energy statement we are expecting soon from the government.

 

I am very worried about the cost of living pressures and will continue to press for more action to ease the impact. Government needs to bend all its powers to controlling the  inflation, cushioning  the  impact and increasing supply where there are shortages. Pensions and benefits will need further review as prices rise, and the tax burden needs to be reduced.

 

Yours sincerely

John Redwood

 

 

Extension to the Household Support Fund

I have received the below letter from the Government Minister for Welfare delivery regarding the Household Support Fund which I would like to share:

Dear Colleague,

EXTENSION TO THE HOUSEHOLD SUPPORT FUND

Our new Way to Work campaign aims to get half a million people who are out of work into jobs in the next four months. It will support employers who need to fill their vacancies, whilst also helping claimants by improving their financial situation. Alongside this initiative, we have announced around £400 billion since the start of the pandemic protecting jobs and incomes.

The economy is in recovery, with a record number of people on the payroll, but we recognise the inflationary challenges and that people are concerned about pressure on household budgets. That is why we are extending the Household Support Fund to provide cost of living support for households most in need, shifting the focus of the fund to include more of those people who cannot work. From April, the government is providing an additional £500 million to help households with the cost of essentials. This brings the total funding for this support to £1 billion. In England, £421 million will be provided to extend the existing Household Support Fund from 1 April to 30 September inclusive. The devolved administrations will receive £79 million through the Barnett formula. In England, the allocation for Councils is the same as for the previous 6 months.

In England, the fund will be distributed via upper-tier Local Authorities. This support will continue to help those who are struggling to afford energy and water bills, food, and other essentials, to prevent the escalation of problems. We know energy bills may be of particular concern to low income households and so Local Authorities are being encouraged to focus on supporting households with the cost of energy.

At least a third of the extension funding (£140m) will be spent on pensioners on low incomes and at least another third (£140m) will be spent on families with children.

This will ensure that the most vulnerable, including those unable to work to boost their income, will continue to receive vital support to help with the costs of household essentials throughout the next six months.

This extension is just one way that we are helping families with the rising cost of living and other global inflationary pressures. The government has recently announced a three-part plan of support to help households with rising energy bills, worth £9.1 billion in 2022-23. This includes a £200 discount on energy bills this Autumn for all domestic electricity customers in Great Britain, to be paid back automatically over the next 5 years. This also includes a £150 non-repayable rebate in Council Tax bills for all households in bands A-D in England, as well as a £144 million discretionary fund for Local Authorities to support households who are in need regardless of their council tax band.

We continue our focus on getting people into work. The National Living Wage will increase to £9.50 an hour this April, providing an extra £1000 pay for a full-time worker. This has risen every year since it was introduced in 2016. The cuts to the Universal Credit taper rate and the uplift to the work allowances will also put, on average, an extra £1,000 a year into the pockets of 1.7 million low-income families.

These initiatives, alongside the Household Support Fund extension, will work to help those most in need over the coming months. For MPs in English constituencies, please direct constituents in need of support to their local authority who will be able to help them access the Household Support Fund. Your Council will be required to produce a plan taking into account the new conditions and guidance. I encourage you to give your thoughts directly to your council leader on how you think their scheme could be improved. For MPs in Scotland, Wales and Northern Ireland, I would encourage you to speak to the Devolved Administrations about their plans to use their allocations.

Kind regards,

David Rutley MP
Minister for Welfare Delivery

My question about the Government’s Schools White Paper

Rt Hon Sir John Redwood MP (Wokingham) (Con): How will the poorly performing schools get the brilliant teachers and better professional development that the Secretary of State rightly wants, because that is what they need?

Nadhim Zahawi, the Secretary of State for Education: My right hon. Friend is absolutely right. We endowed the Education Endowment Foundation when the coalition Government came into office, and I have just announced a further endowment for the next 10 years. It has evidenced the qualifications and quality of teacher training that are required, whether in the early careers framework, initial teacher training or later in life in professional development, and we are following that evidence and scaling up half a million teacher training opportunities. That has never been attempted, certainly in my time in Parliament; it is a huge scale-up of teacher training and that is what we will deliver.

 

Two written answers from the Department of Health and Social Care

I am continuing my questions to the Health department to highlight the  lack of specific costed plans to deal with the waiting lists and quality of service issues that worry people. I am urging the Treasury to make the grant of extra cash conditional on clear plans to deliver more and better service, which in turn will need suitable workforce plans. The answers below confirm there is plenty of management work to be done to set out what additional better service they are promising and how they will spend the extra money they have been granted.

The Department of Health and Social Care has provided the following answer to your written parliamentary question (146529):

Question:
To ask the Secretary of State for Health and Social Care, in the absence of a manpower and recruitment plan, what steps the NHS takes to forecast its spending needs for the year ahead. (146529)

Tabled on: 24 March 2022

Answer:
Edward Argar:

NHS England and NHS Improvement published the ‘2022/23 priorities and operational planning guidance’ on 24 December 2021. This is supplemented by technical guidance on the associated financial assumptions on which the National Health Service should plan. Individual systems plan spending for the year against allocations in response to this guidance and submit plans to NHS England and NHS Improvement to aggregate into an overall NHS financial plan. We expect the NHS to manage their spend within the overall budget in the Mandate.

The answer was submitted on 29 Mar 2022 at 13:13.

 

The Department of Health and Social Care has provided the following answer to your written parliamentary question (146531):

Question:
To ask the Secretary of State for Health and Social Care, how often he meets the Chief Executive of NHS England to review progress with reducing waiting lists and other matters. (146531)

Tabled on: 24 March 2022

Answer:
Edward Argar:

My Rt hon. Friend the Secretary of State for Health and Social Care meets regularly with the Chief Executive of NHS England to discuss a range of issues, including progress on reducing waiting lists.

The answer was submitted on 29 Mar 2022 at 13:15.

A new energy policy

 

The government is offering us a new energy policy. It wants  a new long term plan for its aim of getting to net zero by 2050, and a shorter term plan for the current decade to keep the lights on and to provide affordable energy as we await the technologies and investments in a greener future.

The government is likely to back substantial increases in nuclear provision for after 2030. By 2030 nuclear output will be well down following the closure of most of the existing fleet of stations, with only one major new opening. It will need a big rate of build to turn this round for the 2030s.  The government will also favour more wind generation. This can only work if at the same time the government and the market invest in storage and usage technologies that overcomes the intermittent nature of wind power. This week wind has been as low as 1% of our electricity generated, leaving us very reliant on gas and coal. Even if we had doubled current wind capacity it would have left us mainly dependent on fossil fuels to keep the lights on. Some combination of large scale battery storage, pump storage schemes, the production of green hydrogen and the location of energy using businesses close to wind arrays which can handle intermittency will all be needed if the country is to rely on more wind power. It is unlikely investment in batteries and hydrogen will be sufficiently advanced this decade to avoid the need for reliance on gas and other fossil fuels as transition fuels.

The short term plan is easier to work through. There is an overwhelming case to produce more of our own fossil fuels at home. It cuts carbon dioxide output substantially to do so. It generates a big windfall in tax receipts instead of sending huge sums in tax to foreign countries and in cash to  companies who export to us. It generates jobs here at home. It cuts down transmission losses. The government needs to work closely with the domestic industry to grant the permits and tackle obstacles to the necessary investment in more output.

There can be more help to encourage people and businesses  to improve the energy efficiency of their homes , offices and factories. The public sector could undertake substantial investment in energy savings measures to cut its footprint.

If the country is to succeed with the electrical revolution the government wishes, it will take a new generation of affordable and attractive home heating and vehicle products to wean the public off their current reliance on gas to heat homes and petrol and diesel for their transport and deliveries.

Maiden Place Post Office Reopening

I have received the below letter from the Post Office regarding the good news that Maiden Place Post Office will be reopening on the 26th April:

 

Dear Customer,

Service Re-opening
Maiden Place Post Office
10 Maiden Lane Centre, Lower Earley, Reading, Berkshire, RG6 3HD

We are delighted to let you know that we will be restoring Post Office services to Maiden Place on Tuesday 26 April 2022 at 13:00. The branch closed temporarily in October 2021 following the resignation of the postmaster.

The new service will be operated from the same premises and will offer a range of Post Office products and services. Full details of the new service are provided at the end of this letter.

I know that the local community will join me in welcoming this good news and hope that you and our customers will continue to use this service. If you are a local representative, please feel free to share this information through your social media channels and with any local groups or organisations that you know within the community for example on noticeboards, local charities and in GP surgeries, to help our customers and your constituents understand what is happening to the Post Office in the local community. If you would like a supply of posters, please let us know.

Thank you for your support in restoring a Post Office service.

Yours faithfully,

Network Provision Lead

Two written answers from the Department of Health and Social Care

The Department of Health and Social Care has provided the following answer to your written parliamentary question (119388):

Question :To ask the Secretary of State for Health and Social Care, what estimate he has made of how many additional health professionals he needs to recruit to NHS England in 2022-23. (119388)

Tabled on: 07 February 2022

Answer:
Edward Argar:

The Department has made no specific estimate. In July 2021, the Department commissioned Health Education England to work with partners to review long term strategic trends for the health workforce and regulated professionals in the social care workforce. The Department has also recently commissioned NHS England to develop a workforce strategy which will set out its conclusions in due course.

The answer was submitted on 22 Mar 2022 at 11:16.

 

This is a strange reply. How can the NHS have put in a large demand for extra  cash when it has no idea how many extra  people it needs or wants? Wages and employment costs are its main item of spending.

How can it claim to have a serious working plan to get the waiting lists down if it is not recruiting a decent number of doctors, nurses and other medical professionals to carry out the operations and treatments needed?

What do the senior managers administrators  do that prevents them from knowing how many staff they need? What signal does it send to medical schools and potential students that the near monopoly employer still does not have a plan to recruit more staff?

 

The Department of Health and Social Care has provided the following answer to your written parliamentary question (119392):

Question:
To ask the Secretary of State for Health and Social Care, what forecast he has made for the likely increase in staff costs for 2022-23 for NHS England. (119392)

Tabled on: 07 February 2022

Answer:
Edward Argar:

A forecast has not yet been made. The Government is seeking pay recommendations from the independent Pay Review Bodies (PRBs) for most public sector workers not in multi-year pay and contract reform deals. Remit letters were issued to the PRBs in November 2021. As the PRBs are independent, the Government cannot pre-empt the recommendations, which we expect to receive in May 2022.

The answer was submitted on 22 Mar 2022 at 16:18.

 

This reply confirms that the NHS had not forecast the detailed spending needed to get waiting lists down when it was agreed to impose a tax and send that cash to the NHS. I find this surprising. Surely NHS managers need to know staff numbers and staff costs before submitting a bid for more money for waiting lists?

 

What estimate has the Environment Secretary made for the amount of land that will be taken out of agricultural production as a result of schemes and plans for wilding over the next two years?

This reply does not detail how much land the UK government will pay for to  convert away from growing food. Given the enthusiasm for more domestic food and the supply difficulties in the global system we need to make sure we have the land available to expand UK food production. The UK does less than most overseas Agriculture departments to support domestic supply.

 

The Department for Environment, Food and Rural Affairs has provided the following answer to your written parliamentary question (141109):

Question:
To ask the Secretary of State for Environment, Food and Rural Affairs, what estimate he has made of the amount of land that will be taken out of agricultural production as a result of schemes and plans for wilding over the next two years. (141109)

Tabled on: 16 March 2022

Answer:
Victoria Prentis:

Wilding or re-wilding is the restoration of ecosystems to the point where they are more regulated by natural processes.

Although appropriate only in certain situations, this is something the Government is already supporting through projects such as peatland restoration funding or agri-environment schemes. Defra is also in the process of reviewing and developing an approach to rewilding that takes into account environmental and land use priorities. We will initiate ten Landscape Recovery projects between 2022 and 2024 that will, among other things, help restore wilder landscapes. The focus of these will be on large-scale sites where there are opportunities to significantly enhance the landscape to deliver a wide range of environmental outcomes.

Over the next two years it is expected that the amount of land moving from agriculture production into wilding projects will have no substantive impact on food production.

The answer was submitted on 24 Mar 2022 at 16:12.

President Biden’s gaffes

 

When President Trump was in office the U.K. media and some on this site sought to argue that most of what he said was unacceptable. Now we have President Biden making a string of dangerous gaffes in a series of worrying international conflicts these critics of the USA go quiet.

President Biden’s premature, sudden and ill judged withdrawal of US troops from Afghanistan was unhelpful. President Trump wanted to get the troops home but made it conditional, leaving him unable to withdraw before the election as he wished. Joe Biden did not  bother about conditions and did not understand he was giving the country to the Taliban after 20 years of fighting them. He failed to consult allies. Once he had done it he threw away all the lives and treasure spent on trying to build an Afghan democracy.He also let the Presidents of China, Russia, North Korea and others think the West was weak, allowing them scope to plan power grabs of their own.

Tested in Taiwan he them misspoke in too tough a way. He invented a military guarantee of Taiwan’s independence which the US has never expressly granted. His staff rushed out a reiteration of the official policy of studied ambiguity. The US might go to war over Taiwan . The President accepted the correction.

Worse was to come over Ukraine. The President before Putin had crossed the borders with troops said his response would be more modest if any Russian incursion was limited. It seemed to give a green light to Russia grabbing more of the Donbas and may have egged Putin on with his military plans.

Now we have the President saying he wants regime change in Russia. Commentators and the public can wish that but if the President says it US resources have to be deployed to achieve it. His  staff moved quickly to deny it is a US policy aim.

This is all unhelpful. Relations with countries like Russia, China and North Korea need consistent firmness from the leader of the free world. There  must be no doubt what the rules are or where the red lines lie.