Author: johnredwood

Some  polling by Lord Ashcroft earlier this year reveals that most UK voters have an understandably dim view of Russia. Many of us have no wish to see part of the  USSR recreated by bluff or force in the east. More  interesting and less obvious was that most British voters had an even worse perception of the EU than of Russia, especially Conservative voters. In his poll where 10 is very positive and zero is very negative, Russia scored 4.07, the EU 4.00 and the European Parliament 3.5. Amongst Conservative and UKIP voters the EU score was even lower.

I found myself in rare agreement yesterday with Sir Menzies Campbell when he said there should be a negotiated solution to the problems of the Ukraine: ratcheting up the threats and rhetoric will not help.  I have no sympathy for Russian actions that might destabilise the Ukraine further.  Nor can  I can forget that it was EU action seeking to expand their empire to the West which first started the reactions of Russia. The EU was seeking to entice the whole of the Ukraine towards EU membership and the common security and defence policy via a close Association Agreement. EU pressure helped lead to  the removal of the elected President from power in the Ukraine, which has allowed Russia to question the legality and authority of the interim Ukrainian government that replaced him.

The truth is UK people do not want to belong to a common foreign and security policy which seeks to extend an armed empire of Europe eastwards to the Russian border in a way which Russia finds menacing, but which Russia can also exploit for her own imperial aims. The EU has developed more of the common foreign policy before getting so far with the common army, so it is particularly foolish to push for a bigger EU reach when there is no effective military force to deal with possible adverse military reactions from others.

Some of my Parliamentary colleagues say the UK has to go along with the Ukrainian/US view of the current proto conflict. They imply that because we are members of the Security Council we have to play a role, and suggest there is a simple binary choice to be made between being on the side of the West or backing Mr Putin. I do not see it like that, as this is based on a misunderstanding of the role of the UN and the responsibilities of a Security Council member.

I do want a UK independent of an EU foreign policy to remain  as a member of the UN Security Council.  To keep our seat we need to maintain sufficient modern arms, have  a capacity to intervene, and a willingness to use our force in pursuit of UN causes where needed and where we wish to help  in proportion to our strength . That is what we have done in recent years and can still do. There is no question of us being able or being asked to intervene in the Ukraine through the UN, as the Security Council will not be able to establish a common view on the problem as the opposing  sides are members with vetoes. Similarly, our decision through Parliament not to intervene in Syria did not let down the UN, as Russia was unlikely to agree to western armies entering Damascus or NATO planes  bombing the country.

I do  not think there is much the UK can do to help make matters better in the Ukraine. We have little direct national interest in the Ukraine, and little diplomatic or military power of our own that could make the situation better.  The best we could do is to urge the EU to be less provocative, and to cease supporting the interim Ukrainian regime. It would be better for the EU  to await the election of a new government, and then if that government is  wise and making  sense to use the EU’s  diplomatic skills to help them calm down the tense situation within their country.

The UK should be clearer in opposing a full scale common foreign and security policy for the EU. My colleagues who want us to keep and use our seat on the UN Security Council should realise that the logic of CFSP is one permanent  Security Council seat for the EU in the end, to replace France and the UK.  Anyone interested in our country and its influence in the world should be working  to prevent such an outcome. In the meantime we do not have to choose between an EU dominated Ukraine or a Russian dominated one, nor do we have the power to decide what the outcome might be.

Labour’s economic policy in opposition has been through two phases so far. In the first Labour attacked the Coalition for cutting too far too fast. They predicted that the UK economy could not recover given this policy. In the second Labour switched their attack to the “cost of living crisis” saying that the recovery was  not delivering any rise in living standards.

Labour’s “too far too fast” critique was not based on the numbers. The figures showed the Coalition increasing current spending slightly in real terms in the first three years, relying on rising tax revenues to cut the deficit. Labour have never accepted the figures in the official statistics, but decided to drop the erroneous too far too fast campaign when it became clear the economy was growing again despite their predictions.

They have adopted their cost of living critique close to the time when real wages at last start rising. Some Labour figures are warning their leaders to drop this campaign now before the numbers improve further. I will not offer advice on this. I wish instead to ask what policies is Labour proposing that will alter the situation on living standards?

They have come up with two main policies to tackle the “crisis”. The first is a two year price freeze to be imposed on the energy companies. It looks as if we might get this anyway. Global energy prices have been falling, which makes this easier. If by any chance Labour were in office and world energy prices took off again, it is difficult to see how they could sustain the two year freeze.

The second is to promise action on rail fares. This presumably means lesser increases, financed by larger taxpayer subsidies. What they give with one hand to rail travellers, they will take with another hand from taxpayers.

More worrying is discussion on a higher National Insurance tax. This tax on jobs would make it a bit more difficult to sustain current high rates of jobs growth. As the best way to raise people’s living standards is to get them into work it is difficult to see why Labour are proposing this backwards step.

Labour’s proposals amount to more interference with big companies supplying essential services, allied to more subsidy for a nationalised industry. None of this will make a lot of difference to living standards in the short term, and in the longer term these policies could b e damaging to future investment and job creation. It is one thing to identify the real wish of people to enjoy higher living standards, another thing to know how to raise them. What you need to do that is successful enterprises, more investment, and more growth. How do Labour propose to achieve those?

Yesterday the government published the figures for tax revenue and spending for March, and the full financial year figures for 2013-14.

These show that the deficit has been cut from the inherited peak levels to £107bn last year. Public sector debt as a proportion of our National Income has fallen from the peak level of 151.7% in 2009-10 to 132.4% now. Whilst debt to pay for extra spending has continued to rise, state banking debt has been reduced.

The deficit has been brought down by collecting £100bn a year of extra tax revenue, compared to an increase of £66bn in current public spending. (2013-14 compared to 2009-10) Labour’s cuts in capital spending were largely implemented, but have been eased more recently.

The full year figures confirm the damage a higher rate of CGT has done to CGT revenues. They fell slightly again last year compared to 2012-13, which in turn was well down on the previous year.

Conversely, the higher rates of VAT and Stamp Duty have added to revenues as planned.
The strategy in cash terms still rests on collecting more tax revenue from a growing economy. As the economy grows, so the proportion taken as public sector activity will fall.

Labour is right about one thing. Living standards have fallen too much over the last six years. Indeed, the Conservatives say as much, reminding people that the biggest part of the fall in living standards happened during the Labour period, when the Great Recession wiped 7% off our national output.

The issue before us is not a choice between a Labour party who now recognise there is a “cost of living crisis” and a Conservative party who fails to understand that many more people want an improvement in their living standards. Both main parties know the figures, and recognise the understandable wish of many to see their incomes rise more rapidly than their costs.

The issue before us is which party if given a majority to govern would be the best able to satisfy these aspirations? Is it Labour who crashed the car in 2008, or the Conservatives who in coalition have gradually got the vehicle back on the road and moving again? Does Labour now know how to improve the car and get it traveling faster? How does their approach differ from the Conservative one, and would it produce better or worse results?

We need to start with how things are currently performing. The latest CEBR independent forecast suggests that over the lifetime of the 2010-15 Parliament national income will have risen by 9% and people’s disposable incomes by an average of 4% in real terms. Much of the growth is taking place in the last two years of the five year period. House prices will be up on average by 16% over the five years, unemployment will be down by a quarter from 8% to 6%, and the state deficit will have decreased by 40%. That sounds like a reasonable record in the circumstances, given the damage done to the banking system in the great crash and the problems in financing a normal recovery experienced in the period 2009-13.

The Conservatives can improve on this record free from coalition. They could cut a wider range of taxes than just raising the Income Tax threshold, boosting output as a result. In some cases like CGT and Stamp Duty they could boost revenues by choosing more sensible rates. They can renegotiate our relationship with the EU, which should include cutting the costs and burdens the EU imposes on business based in the UK but not selling into the rest of the EU. They can produce more imaginative policies to promote wider ownership and entrepreneurial success for the many.

Above all a majority Conservative government could tackle high and rising energy prices. The country’s energy supply needs to be shifted more to domestic production of gas and away from very expensive wind energy and imports. Labour signed us up to the EU and domestic climate change agenda in a way guaranteed to drive industry out of the UK. This now needs to be changed.

All my life as a writer I have been in awe of Shakespeare’s way with words. All human life is contained therein. His timeless messages and understanding transcends the minutely observed circumstances and daily items of his own age, as they leap out of the page.

For anyone interested in politics the perceptions of Macbeth show just how easy it is for power to corrupt. Loyalty and friendship are replaced by violence and deception in the pursuit of the crown. King Lear reminds us how close to madness court life can bring people, and how a powerful man who gives away his powers lives to regret his folly. As the Fool reminded him, it is not a good idea to get old if you do not also become wise. Hamlet captures the difficulties for a thoughtful Prince to decide what to do where some urge strong forceful revenge whilst others might favour forgiveness and acceptance of the state of the world.

Midsummer Night’s Dream is my favourite of the comedies. The beautifully crafted play within a play never ceases to amuse. The magic verse of Puck and the fairies enchants, as they play with the fickle feelings of mere mortals, getting into bizarre pickles of their own.

On today of all days we think of the histories set in war torn England before the Tudors. These great dramas capture the shifting fortunes of the rival houses of York and Lancaster. They portray perfect martial kingship in Henry V, weak vacillating kingship in Richard II, and calculating kingship in Henry IV. Their hero is England, long suffering England. We know, as Shakespeare knew, that England emerged from her long time of troubles and strife. England of 1600 had claimed many more glories than the England of the wars of the roses could even dream about.

Let us hope the same is true again today. I look forward to England casting off her current European tribulations. Her greatest days surely lie ahead, as Shakespeare knew they did when writing about the fifteenth century.

John of Gaunt’s famous speech in Shakespeare’s play is one of the most famous eulogies to England. Its tearful ending refers to the damage done to England by the civil wars. Today the troubling issue is England’s relationship with the EU.

“This royal throne of kings, this scepter’d isle,
This earth of majesty, this seat of Mars,
This other Eden, demi-paradise,
This fortress built by Nature for herself
Against infection and the hand of war,
This happy breed of men, this little world,
This precious stone set in the silver sea,
Which serves it in the office of a wall,
Or as a moat defensive to a house,
Against the envy of less happier lands,
This blessed plot, this earth, this realm, this England,
This nurse, this teeming womb of royal kings,
Fear’d by their breed and famous by their birth,
Renowned for their deeds as far from home,
For Christian service and true chivalry,
As is the sepulchre in stubborn Jewry,
Of the world’s ransom, blessed Mary’s Son,
This land of such dear souls, this dear dear land,
Dear for her reputation through the world,
Is now leased out, I die pronouncing it,
Like to a tenement or pelting farm:
England, bound in with the triumphant sea
Whose rocky shore beats back the envious siege
Of watery Neptune, is now bound in with shame,
With inky blots and rotten parchment bonds:
That England, that was wont to conquer others,
Hath made a shameful conquest of itself.
Ah, would the scandal vanish with my life,
How happy then were my ensuing death! “

I welcome free speech in our democracy. I strongly disagree with the CBI’s stance on the EU, but I do not challenge their right to hold it. I would suggest they pause and reconsider their enthusiasm for intervening in debates about identity and belonging, as they can now appraise the results of their current campaign over Scotland’s future.

They have adopted similar tactics in their approach to Scotland as in their stance on the EU. Their threats to Scotland about what might happen to business there if the Scots vote to leave the UK look as if they have been counterproductive. They certainly show a lack of wisdom.

Mr Cridland is a passionate advocate of the union with Scotland. There’s nothing wrong with that, and as a private individual he is welcome to speak out all he likes. As Director General of the CBI he has to consider the views and interests of his members. He claims that his members are also Unionists. Many might be, but as we have seen, the CBI is now facing the resignation of various member firms because they are either not Unionists, or think it is wrong for the CBI to take a strong political stance on such a divisive issue. It does not look good to see resignations on principle as the result of the CBI declaring a view on Scotland’s future. That cannot help the cause of Better off together. Was it wise?

The main CBI tactic in the Scottish debate has been to claim that various businesses will either leave Scotland, or would cease new investment and job creation there should Scotland leave the UK. This statement was countered by some businesses making the opposite case, saying they might find Scotland more attractive if it was independent. For example independent Scotland could set a lower aviation tax than the rest of the UK which aviation businesses would find attractive. The original claim created a sense of disunity, with other voices trying to undermine its credibility. Far from helping the Better Together campaign, it looks as if the business interventions have hindered the cause they are trying to help. At best they have not been able to prevent a clear swing towards separatism in the polls.

Which brings me back to the issue of the CBI’s stance on the EU. The CBI want to negotiate a new deal with the EU, but also want to say that the UK must stay in whatever the results of the negotiation. Good business people understand that to negotiate successfully you need to be able to walk away from the negotiation if necessary. The CBI is out to hobble the UK before it begins discussing what a new relationship with the EU might look like.

Maybe I should not worry about the CBI stance, because on the EU as on Scotland the voters may not be swayed favourably by it. It would be good, however, if the EU debate were spared the misleading claims that many businesses would pack up and leave if the UK left the EU. This was after all a claim many in the business community made if we did not join the Euro. They were wrong about that.

Mr Cridland may have had good reason to think most member firms were pro the union of the UK. He should not be under any delusion about belonging to the EU on current terms. Most people are against that and do not want our negotiating power hobbled, and that must include some business leaders. What he is experiencing today with the CBI’s unfortunate incursion into the Scottish referendum would be small beer compared to the grief intervention in the EU debate might cause him. It is not wise for business organisations to interfere in matters of belonging and identity, matters more of the heart than head. Sticking to the facts is one thing. Claiming you know how businesses will react, when you were wrong last time about the Euro, is not wise.