Author: johnredwood

In the current debate about the return to the office I have only one firm conclusion. It is not the job of government to tell the private sector how to organise their workplaces or how to run their companies.

It is the job of government to lead the management of the public sector. Ministers appoint the most senior managers, like the bosses of Network Rail , the Environment Agency and all the other nationalised businesses and quangos. Ministers direct the work of the civil service. They do need to make decisions about how many staff need to attend an office, and where that office should be, on the advice of the senior managers.

It is clear Ministers and the heads of the civil service think the core civil service is needed in person in the central offices of the state. The task is now set for civil service managers to bring that about. It is also the case that where public service is falling behind in meeting demand for licences, permits, passports and the rest compared to pre pandemic levels there needs to be an urgent review of working practices to ensure good service levels.

It looks as if parts of the private sector have decided that the five days a week commuting model into a central City office is not a good one for some of their staff. In many cases staff can work from home given ubiquitous digital technology. Many staff are trusted to work from home, and can be monitored in detail by the use they make of their computer, on line conferences, email and phone. Sensible companies want enough good quality output more than they want someone to sit at a given desk for specified hours. Companies seem to be saying they want a new settlement where some people attend the office all the time and some part time. Some meetings will take place by on line call, and some in person around an office table.

For any given individual there is a reward if they have trusted status and permission to work from home some or all of the time. They save a lot of lost time and money on commuting. Quite often employees reward the company by working additional hours or hours not within their formal contract to get the work done well from a home setting. If the employer lets you supervise the plumber or pick up your child during the working day, why wouldn’t you take a call from a customer in the evening?

What has emerged from lockdown is just how much many commuters dislike the travelling part of their old lives. Poor train and bus services that let people down with cancellations and delays, and crowd people on uncomfortably is neither a good start nor a good end to the work day. The collapse in demand for public transport brought on by anti pandemic controls is being seen by many as a bridge to not having to travel daily even after the virus has subsided as a threat.

There remain many employees who do not have the option of homeworking. Most of the much damaged tourism, leisure and hospitality industry requires staff to assist the public at the place of service supply. Public sector offices helping the public may need the maintenance of physical offices with staff to carry out the work, as well as on line options for many to use.

I would be interested in your views on what the new settlement might look like. How much flexible and homeworking will there be in a year or so’s time, assuming the virus threat continues to retreat?

August was a quieter month than usual for car sales. Despite the recent exit from lock down, sales fell 5.8% on the month, with an especially big decline in business purchases. Many people and companies remain put off by the aggressive Vehicle Excise duties, and by the continuing spin against conventional cars.

As I feared, present policy is much more successful at dissuading people from buying new diesel or petrol cars than it is at persuading them to buy new electric vehicles. 2020 to date has seen a massive 59.7% reduction in diesel car sales. It is this segment of the market that the UK had done so well in, with large investments in clean diesel engine technology. There was also a decline of 44.6% in petrol cars. There were substantial percentage gains in the sales of electric and Plug in Hybrid cars on a small base. The market year to date has seen all electric vehicles take just 4.9% of the sales, and Plug in Hybrids 3.3%.

If the government cares about the state of the motor industry it needs to review its tax policy, and to reflect on the pace of change to electric products. It is curious that the car industry itself does not seem that concerned about the damage transition is doing to it. Some are still talking about Brexit effects when it is obvious that CV 19 shutdowns and the hostility to diesel and petrol cars has driven a big decline in the market before we leave the EU single market. It is tax and electric car policies that pose future problems.

What would it take to get readers to buy a new car any time soon? And what would you want from an electric vehicle on range, charge times, availability of power and price of car to make it a more interesting proposition? Clearly the public is very underwhelmed by the current offerings despite the enormous pressure on everyone to switch. So far the government is just proving it is easier to destroy successful past investment than to make successful new investment pay. They have put people off new cars but find it difficult to switch them to battery products.

(A longer version of this was requested by the Daily Telegraph for this morning after I had prepared this blog)

Levelling up is a good idea. It requires tax cuts, not increases. It requires using the planning system to allow more building and construction based investment in the parts of the country that want the extra jobs and money it brings.

The government has just shown how a tax cut can provide a good boost to activity, jobs and incomes. The cut in Stamp duty has encouraged people to get on with swapping their home to a property that is closer to their current needs. It has helped people downsize and upsize, to move from urban areas to  more rural areas, or to move into cities from the countryside. It has allowed people to buy extra space for  homeworking, or  locate closer to schools or workplaces. It has given them more choice.

As a result housing transactions have just exceeded the pre pandemic levels. When people move it creates work for the estate agents, conveyancers, mortgage businesses, removal firms, painters and decorators, builders doing small works and many others. The Inland Revenue will probably be a winner too from  taxing all that extra activity as well as getting a Stamp duty boost from more transactions as some offset to the lower rates. 

Government works best for people when it respects their wishes, helps them achieve their ambitions and extends their effective choices. We need a series of policies that do just that. Levelling up needs urgent action to bring in  extensive freeports to boost industrial and commercial investment. It needs cheaper energy so we make more things here. It requires new farming and fishing policies so we grow and rear more of our own food.

The government cut the top rate of income tax and collected more revenue from the better off. It cut the rate of corporation tax and collected more revenue from business. It offered a meals discount and kick started restaurants. Let’s have some more policies that promote levelling up  by cutting taxes and costs for people. That way we will get the deficit down more quickly, from all the extra activity.

The government wishes to see 300,000 house a year built, largely by the private sector. This would amount to an annual investment of say £50 billion in their construction.

We have held the debates before about migration and numbers. Today I wish to discuss the issues the government is consulting on. The consultation is not about migration and just assumes large house numbers.

The issue is where should such a large number of homes be placed? The government has recently issued a couple of Planning policy documents. I wrote about the main one here, eliciting little interest.

The second one is a series of proposals for immediate rather than longer term reform of our planning system. It sets out a new method for calculating housing need which in turn would inform housing targets for each Council in the country.

The base position seems sensible, suggesting a 0.5% increase in existing stock in each Council area each year. This would provide a reasonable number of new homes everywhere allowing some flexibility to home buyers. There is then an added “affordability” formula or algorithm to increase these numbers, as 0.5% leaves the country well short of the government’s own 300,000 target.

The adoption of this proposal produces a strange result.Instead of adding to the housing stock in the places where the government wishes to level up, their numbers are cut. Instead of reducing the flow of more investment and better paid people into the areas that are already well above average in prosperity and employment, they are scored to need many more. The estimates of the impact suggest Sussex would see a 127% increase and Surrey an 83% increase whilst the North East would have a fall of 28%.

I suggest the government thinks again lest this algorithm proves as troublesome as the exams one. We need a levelling up one, where more homes are built in those places which want the investment.

There was no slot for me to speak in the fishing debate yesterday in the Commons ,such was the understandable pressure from MPs for fishing seats to speak.

What I wanted to say included the following

1. The government must not sacrifice our fish for the sake of some wider deal. The UK feels very strongly that we have been badly treated over fish from the original entry terms onwards. The Common Fishery Policy has been bad for our fish, bad for our fishing industry and bad for the marine environment.
2. When we take back control we should greatly expand the amount our own fishing fleets can catch, and require most if not all of the fish from our fishing grounds to be landed in the UK. We need to build a bigger fish processing and retailing industry.
3. The government should ban the ultra large predatory trawlers which damage the sea bed or the wider marine environment when scrambling to catch more fish, and attract too much bi catch as they do so.
4. We should strengthen our offshore protection vessel fleet to enforce our fishing rules, protecting our marine environment and managing our fish stocks well.
5. The new fishing policy should encourage a rapid expansion of our fishing fleets, with government help with the financing of suitable vessels and encouragement to the banks to lend for the purpose.
6. The new fishing policy should be part of a wider policy initiative to encourage far greater food self sufficiency and fewer food miles.

I wrote this last week for Free market Conservatives and am now reproducing it here:

The BBC are their own worst opponents. Their recent cancellation of a couple of much loved old songs that are famous worldwide and have not before caused protests led many  of their  former BBC news/Radio 4 audience to anger or despair. They are so dominated by the fashionable global  political correctness and by the briefings from the EU and international bodies that they can no longer relate to the many in the UK who like our country, are at peace with most of its past and just wish to be entertained. They are ready to run any cause which wants more government, higher taxes, more spending by the state, more submission to international treaty rules and more dependence on EU suppliers.  They revel in allegations of inequality and unfairness, whilst seeking to remove their own high payments to some  talent from  the full public gaze. Their constant cry is government should do something. They tend to see  business as a source of stories of overpayment and possible corruption, and show scorn for anyone who does not share their corporate values. 

Last Saturday morning I made the mistake of listening to the Radio 4 Briefing Room programme about the EU/UK talks. For half an hour they paraded so called experts and BBC correspondents who gave us yet another tedious version of Project Fear. There was no attempt at any balance. No-one spoke for the UK and no-one spoke of the many advantages Brexit can  bring. The overarching perspective was that supplied by the EU. There was no attempt to cross examine the EU position and ask about the risks to their big export trade into the UK and our opportunity to substitute UK produced product or cheaper rest of the world product with freedom from EU tariffs. There was no attempt to explore the big upside possible for more food grown and reared in the UK , nor of the way world competition will also affect EU suppliers where we do not have a domestic  industry to protect. The importance and opportunity for our fishing industry was dismissed, though they did think fishing was important totemically for French and Spanish fishermen!  It was as if they had joined the EUBC and had decided not to bother about the  views of a majority of the UK licence payers. 

The BBC’s charter requires the BBC to be neutral and to allow a wide range of views and arguments to be put. Their news coverage does seek to give most political party representatives a hard time, and during elections in particular they are careful to observe the rules over representation. That does not make their overall output  balanced. For years studies showed the BBC gave plenty of easy airtime to those who wished to make the case for the UK’s membership of the EU, but gave far less time to those who wanted to leave. Those who did get on were interrupted, heckled and often presented in an unfavourable way as if their democratic cause was unworthy or absurd. Once the people had voted to leave the BBC would still not accept the verdict, and delighted in giving maximum exposure to the minority representing the global political establishment who wished to undermine or reverse the decision. Many of their storylines come from the Guardian and from Labour and Lib Dem research. They do not offer a similar range of stories for all those seeking to reduce taxes, expand prosperity through enterprise, query the conduct of nationalised monopolies and challenge the global consensus on major issues. To many in the BBC  President Obama’s substantial bombing campaigns were fine, but some of President Trump’s tough or one sided statements designed as a substitute for  military action are  unacceptable.

It means reform of the BBC is in the air. This will be necessary anyway, as we thunder towards a very different media planet where people download much of their entertainment, get news from a range of worldwide instant services, and spend more time on social media than conventional media. The immediate issue is should the licence fee be a normal charge  where payment is enforced by civil and not criminal means? How much longer anyway will the licence fee serve their needs, given the way many people can avoid live tv and so claim they do not need to pay it. A simple first reform would be  to decriminalise the licence fee and unclutter the courts of the licence fee criminal cases. In other guises the BBC would be against a poll tax. They should think again how best to finance their activities going forwards. What is good public service  broadcasting and how much if any should  be taxpayer financed?  Let’s have a modern proposal. Shouldn’t some of the BBC’s current more commercial activities be paid for by   the audience they can command as for other media outlets? We need a new settlement, with the majority of the country that did vote for Brexit feeling we can be included. The BBC should not offer unfair competition to other media outlets financed by their unique access to a dedicated poll tax.

The Treasury should be told that tax rises now would be bad economics and worse politics.

The deficit has soared because government anti virus policies created a huge and fast downturn. In a recession public spending soars and tax revenues fall. Cutting the deficit needs a fast and strong recovery, so Public spending falls and tax revenues rise. In this downturn public spending was massively boosted by taking 9 million people onto the state’s wage bill whilst their jobs were prevented by lock down. We need to get them back into private sector jobs to remove the cost to the government and to get more tax revenue in from their better pay and overtime.

Far from needing tax rises we need rate cuts and tax holidays to promote more activity and jobs. The temporary cut in Stamp Duty is leading to many more housing transactions which will protect or create more jobs and increase tax revenues on the Activity in the housing market.

The Treasury has always been reluctant to accept that often the way to get more tax revenue is to cut rates to stimulate activity. That is what is needed now.

All those who think sterling will fall every time there is no progress on a Brexit deal need to think again.

Over the last month of reports of no progress in talks sterling has risen by 3% against the dollar and 2% against the Euro. Over the last year of talks going nowhere sterling is now 10% higher against the dollar and 2% higher against the Euro.

So why no rush by the pro Remain forces to express pleasure, when they are so ready to rush out misleading releases wrongly blaming Brexit every time sterling dips?