Author: johnredwood

For years Germany and the Netherlands have resisted any idea that the EU should borrow money together and spend it in the poorer areas of its territory. They wanted a currency union but not a benefits union, a monetary union but not a transfer union.

The dollar area or the sterling area are currency unions backed by self governing states. In each there are large transfers of money from the richer parts of the area to the poorer parts. These take the form of grants to local government from central taxation, grants to individuals through the benefits system based on need, and common taxation raising m ore from the places where incomes are higher. As a city or county that suffers relatively low incomes cannot devalue against the richer places, it needs to the grants to get its living standards closer to the national average.

Last week Germany and France came to an Agreement. They propose a Euro 500bn fund for the EU, to spend on recovery from the pandemic.  The money will be borrowed by the EU as a whole, where each state stands behind the loans in proportion to the size of tis economy.  If the EU decides to spend proportionately more in the distressed areas of its territory, then it would have some mild element of redistribution about it.

Time will tell whether this is the first step on the full road to a transfer union, or whether this is a one off gesture soon to be watered down by delays in getting the money and by an approach that all states should have prizes in the lottery draw for the funds.

I have always thought those in the EU who argue they need a transfer union to complete their monetary union are right. The problem is the true price of solidarity and more equal standards will be very high for German and Dutch taxpayers. Is this a saleable proposition to them?

We now have the opportunity to get rid of regulations, taxes and charges imposed on  us by the EU as we leave fully at the end of December. We need to use these freedoms to promote faster growth and more employment.

The government could begin by repealing the Ports Regulations. These were strongly opposed by our port industry when they were in negotiation, and are not relevant to the UK where our ports are mainly private sector owned competing businesses.

It could go on to make the Data Protection legislation less bureaucratic and more effective. The EU system has set off an avalanche of box ticking exercises, often impeding legitimate communication with groups of people who wish to be on mailing lists. Of course we need high standards of protecting sensitive data, but we do not  need a system which stops legitimate sales promotion or information flows  to people who want to be in touch.

We need to remove VAT from a variety of items often mentioned here.

We need to tear up the fishing regulations and replace them with UK based ones that are kinder to our fish and to our fishing industry.

It is time for government to come out with proposals that can make it easier to start or re start a  business and to keep or create new jobs. Unemployment is already far too high thanks to the anti virus policies adopted, and is set to go higher as we limp out of lock down.

It is quite clear that there will need to be accelerated change in our economy to cope with the social distancing rules and the other changes that the pandemic has brought on. There will be more on line shopping and less shopping in physical stores. There will be more remote technology working in  health and education, in leisure and office work. These big changes will require large companies to be adaptive, and will require many more new and smaller businesses to offer new models and services and provide the flexibility fast change needs.

Let’s start with cutting into those great lists of the unemployed. Why not let any self employed person take on an employee or assistant, with the first year based on them being self employed. It is often the hassle of National Insurance, pensions and other paperwork that puts the self employed off expanding a successful business  by taking on additional staff. Give them up to a year to work with someone to see how good it can be and to guide them into the idea of accepting full employer responsibilities. Alternatively it might lead them to adopt a partnership or franchise model with the new person. We need more self employed to expand their often successful businesses.

End the threat of IR35 changes. We are losing business to foreign companies, as large groups here worry about carrying on or taking on a UK self employed contractor for fear that their tax status will be queried at a later date.

Raise the VAT threshold to allow small business more activity before they need to go through the complex process of registering for VAT.

There were around 5 million self employed when the pandemic struck. We need to see them as an important part of our future, and give them every help to get going again and to grow their activities. Sometimes the Treasury seems to see them as a nuisance, seeking ways to tax them into working for a large employer or not working at all. It is a prejudice we cannot afford.

It is right for the government to cushion individuals and businesses temporarily losing their incomes owing to the lock downs. It is right for the government to provide a fiscal boost to offset some of the massive deflationary forces unleashed by the global anti virus policies. It is not right to waste public money or add to the burden of the debt with marginal or unwise spending.

So I renew my list of spending reductions that are even more needed now, given the state of public finances.

1. Reduce overseas aid spending. It will exceed the 0.7%  of GDP legal requirement this year given the fall in GDP unless it is reduced. Start by taking £1bn off plans.
2. Improve collection of the charges for use of the NHS by overseas visitors. It is a National, not a Global Health Service. Possible £400 million extra.
3. Cancel HS2 saving up to £100 bn over a period of years
4. Toughen enforcement against people trafficking to cut the costs of illegal migrants.
5. Insist on leaving the EU at the end of the year with no further payments to them. Savings of £1bn a month thereafter.
6. Stop Councils building property asset portfolios based on low cost public borrowing.

Some people want me to publish their personal campaigns against a few named billionaires. I tell them repeatedly I will not do so. It is  not the purpose or nature of this site.

Some claim these billionaires lobby governments, setting up lobbying institutes to  seek attention for policies they favour. Indeed , some of them do just that. So do Trade Unions ,raising millions from their members, large charities, spending a fortune on  adverts and lobbying, opposition political parties, every large company that has a government affairs department and many others. All of these people and institutions use money they have earned or raised to sharpen their message and to try to influence Ministers who make decisions and to influence the  officials who help them. Sometimes they want governments to do things that are self serving for them and possible damaging to the rest of us. Ministers need to stay alert and work out who to trust.

One of the  purposes of this site is to examine the quality of the decisions governments and public institutions  make and the consequences of them. As an MP I am also seeking to   influence government on  behalf of my constituents and in line with my and my party’s view of how to proceed in the national interest. Where external lobbies are putting forward damaging or ill judged proposals then I am always willing to give a voice to the counter arguments to their theories and propositions.

I am not willing to publish personal attacks on people who believe they are working for the wider good just because one or you – or I myself – disagree with their advice. I do  not have the capacity to research the truthfulness of claims made about them. Please find somewhere else in the media who do want to run with conspiracy theories if you believe you have a case. Governments do not have to follow these people – sometimes they choose to do so, presumably when  they think they are right.

Mr Frost’s letter to Mr Barnier told him some home truths. Is the EU stupid or wicked in thinking that the UK wants to stay as part of the single market, and therefore needs to make concessions to do so? The UK has made it crystal clear we are leaving both the single market and the customs union. We have also made it clear we would be willing to grant the EU a Free Trade Agreement, which will help them more than us, as an act of friendship which could also be of modest benefit to us as well.

As Mr Frost asks, why is the EU apparently unwilling to offer the UK something similar to the FTAs it signed with Canada and Japan?  They obviously thought those were in their interest.

I at last got a speaking slot yesterday in Parliament. I made clear there must be no UK concessions and no extension to the negotiations. Either they come round to an FTA or they do not. It’s up to them. The UK will be fine either way. We do not need to pay to trade- not  in money,  not in fish nor by sacrificing our freedoms.

Yesterday the government issued an excellent document setting out the basis on which we will trade from 1 January 2021 as an independent state and member of the WTO. We will set out own common tariff for the rest of the world which will apply unless we have a Free Trade Agreement with the counter party.

Our tariff is lower, simpler and easier than the EU one we currently have to offer to non EU countries. It takes tariffs off items we cannot grow or produce for ourselves.  It takes tariffs down to zero for products manufacturers in the UK need to help them make things here. So cotton, and   various engineered tools drop to zero for example.

It takes all tariffs that are under 2% to zero to save all the admin. It takes fiddly tariffs down to the nearest whole number. It takes tariffs off energy saving, recycling and renewables. The tariff on thermostats for  example disappears.

The Secretary of State for Trade confirms two crucial matters. Firstly, she makes it clear this will apply from 1 January 2021, so there are no plans for any delays to our full exit. Secondly, she confirms there will be no tariffs between Northern Ireland and the rest of the UK. The EU will not be allowed to wrestle Northern Ireland into their customs union and out of our common customs system.

Many of us  MPs wanting to implement the referendum  have been pressing for just such an outcome for many  months.

The Government has this morning (19 May) announced the UK’s new tariff regime, the UK Global Tariff, which will set out the duty charged on imports from other countries. This will replace the EU’s Common External Tariff on 1 January 2021 at the end of the Transition Period, by which point we will have reached an agreement on our future relationship with the EU. The UK Global Tariff will only apply to goods from all countries with which we do not have a preferential trading relationship.

It is a simpler, easier to use and lower tariff regime than the EU’s Common External Tariff (EU CET) and will be in pounds (£), not euros. It will scrap red tape and other unnecessary barriers to trade, reduce cost pressures and increase choice for consumers and back UK industries to compete on the global stage.

The government is taking a common-sense approach to our new tariff schedule by streamlining and simplifying over 7,000 tariff lines and lowering costs for businesses by reducing administrative burdens.

The UK Global Tariff will provide a baseline from which we will negotiate free trade agreements with partners around the world, giving us the leverage to negotiate the best deal for the UK, and replace the EU tariff that we currently apply.

• The UK Global Tariff will make it easier for businesses to trade. o Our tariff will be in pounds – not euros. Paid in pounds, calculated in pounds, this is a stable tariff for UK traders.

• Our tariff cuts administrative costs for businesses. We are getting rid of needless tariffs which create administrative burdens. All tariffs below 2% are gone (e.g. fire extinguishers, school pencils and gardening tools, move from 1.7% to 0%).

• Our tariff is simpler to use. We will round tariffs down, making them simpler for traders to use (e.g. reading glasses move from 2.9% to 2% and alarm clocks from 4.7% to 4%). We will also scrap the EU’s complex calculation for certain processed goods- which results in over 13,000 tariff variations on products like biscuits, confectionery, and spreads – applied under the EU Tariff.

• The UK Global Tariff will back UK manufacturing and production. UK manufacturing and production. We are dropping tariffs to zero across a wide range of products used in UK production (e.g. tools for tapping and threading metal move from 2.7% to 0%, and spanners and wrenches from 1.7% to 0%).

• The UK Global Tariff will reduce cost pressures and increase choice for UK households. Tariffs will be removed on products that we do not produce, or do not produce much of in the UK. Removing these tariffs will lower cost pressures for UK households and businesses (e.g. pistachios move from 1.6% to 0% and cotton yarn from 4% to 0%).

• The UK Global Tariff will protect developing countries. These countries will maintain tariff free access into the UK on goods such as vanilla (6%), plantains (16%) and bedlinen (12%). Whereas non-developing countries will face the UK tariff on these goods, where a trade agreement is not in place. Therefore, the UKGT maintains the continued preferential access for these countries.

• The UK Global Tariff will promote a sustainable economy. We are cutting tariffs on over 100 products to back renewable energy, energy efficiency, carbon capture, and the circular economy through recycling and reducing single use plastics (e.g. thermostats move from 2.1% to 0%, vacuum flasks from 6.7% to 0% and LED lamps from 3.7% to 0%).

As set out in the Protocol, Northern Ireland is a constituent nation of the UK and part of the UK’s customs territory. Tariffs are not payable on goods moving within the UK. The arrangements the government will introduce will reflect this.

As we recover from the unprecedented economic challenges posed by coronavirus, the UK will champion free trade, fight protectionism and remove trade barriers.

Our new tariff is tailored to the needs of the UK economy. It will support the country, by making it easier and cheaper for businesses to import goods from overseas from 1 January 2021.

The UK Global Tariff will protect UK sectors, such as agriculture. Tariffs will be retained for products such as lamb, beef and poultry. The Government has removed tariffs on products that cannot be produced in the UK – including approximately 150 agricultural products such as various vegetables, fruits and oils.

Today Parliament will hear a statement on the Brexit talks.  Like last week all my  requests to ask oral questions or participate in Statements have failed in the ballots for slots because time is so limited,

What I wish to say and have said many times to Ministers is we must not delay our exit. Nor should we concede our fish, money or law making powers. The UK has rightly offered a Free Trade based Agreement and should stick with that offer.