Category: Blog

I have often written about how much many people hate the bossy, autocratic snooper government which has damaged our freedoms in the last decade. We hate the cameras, the road blocks, the hectoring public advertisements, the multiplying army of regulators, the aggressive tax collectors, the enforced political correctness, the thought police, the concrete blocks around Parliament, the spying on our rubbish bins and the stealthy approach to making us all have Identity cards. Government, both national and local, has become a bunch of snoopers who know how we should all live and know where we live.

They want us to know they are watching us, with a view to fining us if we put a foot out of line with their view of how and where we should walk. They have used the threat of terrorism as an excuse to intensify their prying eyes, their eavesdropping and their defended lives. They have used climate change as an excuse to raise more taxes. They have sought to change people’s drinks and diet, using that as another excuse to raise more taxes.

In the age of the internet they are now discovering that the cameras which point at the public can also capture them. When people ask the old question, Quis custodiet ipsos custodes? – who will watch the watchers themselves? – we now have a new answer. The watched can watch the watchers.

Many people have mobile phones which contain cameras handy for instant recording of an offisde official. The internet allows access to plenty of public information. It permits people to transmit their anger and experiences of the guards instantaneously around the world. We can all now issue our own newspaper by web publishing, or make our own broadcast by webcasting.

The anger with the political elite in Britain is now enormous. The expenses row allows people to vent their anger about the behaviour of the politicians. That anger has been intensified by the them and us approach to life which has been on display from so many of the politicians who have lectured and hectored others on how they should live. Too many MPs spent taxpayers money on trying to create a ring of concrete and guards around Parliament, when Parliament should be open and welcoming to the public that pays for it and looks to it for justice and wise law. The public now have the means to put the guards under surveillance, and now have the issue to fashion their revenge.

I used to find latin hard work, but I do recall Quod me nutrit me destruit – what nourishes me also destroys me. That sums up what is happening to MPs who loved to regulate and tax people more.

Yesterday saw another lamentable performance from the Bank of England.

Some see it as commendable humility and honesty to tell us on many occasions they do not know what will happen next.
It should lead instead to questions about why they employ so many highly paid economists and forecasters if they do not have a well informed opinion. Why issue forecasts at all, if you they are as wrong as the Bank’s have been in recent years, and if even the boss has little confidence in them?

The Bank wanted to get over two messages. One was the green shoots the market sees may not be robust. It may be worse than the Stock Exchange mood of last week. The second was monetary easing and ultra low interest rates carry on for the long haul.

These are both forecasts. I hope both are wrong. This economy needs more savings. That requires higher interest rates than the Bank’s guideline rate. This economy needs better control over inflation. That too requires a sense of monetary discipline.

In the real world people are getting a bit more for their savings than the usual margin over Bank base rate, and borrowers are having to pay a lot more than base. The market is ignoring the base rate in many cases. We are still experiencing the full impact of higher prices from the devaluation, and now face higher prices from commodity rises brought on by easy money worldwide.

What I wanted to hear yesterday from the Bank is how they intend to get from Quantitative Easing to a rational market? How are they going to withdraw all that extra liquidity before it is inflationary? Who is going to buy all the gilts they own, as well as all the gilts the government needs to sell?

I understand the growing anger about the Speaker, which some of you have written to me about. Some of you ask, do I support a motion of No Confidence in the Speaker?

I did not vote for Speaker Martin when he was first elected. I accept his authority by virtue of his holding the office, all the time it is the wish of the House that he is Speaker. He holds his office because he commanded a strong majority of the majority party when he was elected.

In these circumstances the issue rests with the Labour majority. They elected him, and they will determine whether he stays in office for the rest of this Parliament. If Labour now wants a motion of No Confidence then I will tell you how I will vote once it is tabled with Labour support. A partisan Conservative motion against the Speaker would not be a helpful idea at this juncture.

Yesterday was an important day in the battle to change attitudes towards public spending. MPs started to repay amounts they had claimed legally which the public thought unreasonable, as well as amounts that should not have been claimed. The day brought in more than £100,000 of returns. The boss of Network Rail who is paid a high salary realised that to take a bonus as well would be wrong in the circumstances, though not all his senior collegaues shared his wisdom. This heavily subsidised business which has cost taxpayers a fortune in recent years needs to improve its efficiency much more before bonuses are paid to people at the top.

David Cameron confirmed tighter rules for Conservative MPs expense claims which should bring them down this year compared to last, and renewed his calls for fewer MPs. Labour Ministers showed they now understand the public mood about excessive expense claims.

Unfortunately Ministers still have not grasped the need to control the large sums and the large projects under their control. We still have not heard them stop the ID computer and other very expensive computer schemes. Recent answers to my questions show the consultancy bandwaggon rolls on. And yesterday the taxpayer was told he had to stand behind another £1,000,000,000 of Olympics spending that was meant to be privately funded. Maybe they should review the total costs of the project and find ways of saving some money.

We cannot afford many more days when the net increase in spending is still almost a billion pounds, even after the refunds to the taxpayer.

Last night we had a trip down memory lane to a time when Parliament had some rights. The government allowed us to talk for as long as we liked about parts of the Finance Bill. We had a rare Parliamentary day without a guillotine. We could carry on with our work after 10 pm.

The House held debates on corporation tax, small business taxation, and VAT. The government refused to accept a Conservative amendment to take the Corporation Tax rate down to 25%, to attract more business and investment to the UK. They refused to believe that if you set lower tax rates you can end up with more tax revenue. They declined to put the small business rate down to 20%, at a time when every little helps small business under pressure.

By 10 pm we had reached Clause 11, the big increases in alcohol duties. There was substantial interest in this debate, given the strenuous lobbying by the industry and the licensed trade. They have made the case that the sharp increase in pub closures results from high duty levels and therefore higher prices. The government got bored with having to face arguments about job losses, closures and the impact on communities, so it reverted to form and moved a premature end to the business.

Nonetheless, we did have three hours or so to examine the problems of a highly taxed industry, and did have a Parliament capable of functioning after 1 am. I felt nostalgic for a more democratic era as I spoke on the topic after 1 am this morning. If only we were allowed democracy more often, we might be able to educate Ministers some more. They still do not seem to understand the impact their fiscal decisions are having on jobs and output.

I have long been predicting slumpflation. It was inevitable, given the wild fiscal policy and the manic monetary policy the government and Bank are following. Figures for the last quarter show that is exactly what we now have.

Manufacturing output is down a massive 13 % on a year ago. Why didn’t the authorities cut interest rates in 2007, when some of us urged them to do so, to cut the prospective decline in output in Q4 2008 and Q1 this year? The likely crash was obvious. Mr Blanchflower on the MPC foresaw it as well. Unemployment soared by 244,000 in the first quarter, and by 268,000 in the last three months.

Meanwhile, consumer price inflation as measured by the CPI, the government’s chosen measure and the one used for the Bank of England’s target, rose at a 2.9% annual rate last month. That is a massive 45% over target, and a high rate of inflation for a country experiencing a slump.

Why didn’t the MPC heed the inflation warnings some of us made in the second half of last year? Why didn’t they leave interest rates at say 2%, to offer savers some return and to send a signal they were not going soft on inflation and the value of the currency? Why didn’t they see that too large a devaluation would trigger further inflationary rises?

Has the MPC given up on watching inflation and trying to hit its target? Do they expect the slump to take care of all problems? Whilst most commentators expect price inflation to fall more in the next few months, we do not wish to see the seeds of the next inflation sown at the same time.

They should look at the recent performance of oil prices. They are today around 70% above their lows of earlier in the year. It looks as if the money from money printing on both sides of the Atlantic is finding its way into share prices and commodities.Some people call that inflation.

The authorities are getting themselves into the pickle of having no good choices left. If they are not careful we will end up with more of the same – slumpflation.

I hear this morning from the BBC that Mr Cameron is now “isolated” in Europe because he dares to take the Conservative Group out of the EPP.

That puts us into line with the majority of people in Ireland who voted No to the Lisbon treaty. It puts us in line with the majority in France who voted down the first version of it. It puts us in line with all those Danes who voted No to past federalist plans. It puts us in line with the millions of citizens across the European nations who want to trade with each other and be friends with each other, but who dislike the self appointed EU political elite living high on the hog at our expense.

We hear that Mrs Merkel will freeze him out. Not if and when he becomes Prime Minister. She will have to listen to what the UK wants. I bet she still wants us to pay huge sums into the system.

We are told we will have no influence. We have no infuence under this craven, back peddling, mendacious government, who offered us a referendum to win an eleciton, then denied us one after it. They give in on everything the EU elite want us to accept. They even gave away a big chunk of our rebate for no good reason.

The public is in no mood for lectures on being good Europeans and having to tow the line to be in the in crowd. The tide is out for political elites. The EU one is no exception. Well done. David. You’re better off out of the EPP. Its high time the European Parliament had a substantial group that provided some opposition to the long march to centralisation and more Euro control.

The BBC and the rest of the EU establishment must be rattled, to make this an issue in such a one sided way.

Our headline is “Conservative Leader resigns from political elite to join his fellow countrymen and women.”

Yesterday the Speaker’s remarks triggered another wave of bad press for Parliament. Last night there was a meeting to discuss what to do next about MPs’ expenses. I would like the Speaker to give us another Statement, based on whatever took place at that private meeting for a few MPs on the relevant committee. Ideally he would say:

” I am conscious that Parliament’s standing has fallen badly. I recognise that many in the House and many more outside wishes to see us rebuild the stature of our democratic institution.

“Last night we began that task. Immediate measures will be taken to tighten the audit and control over MPs’ expenses, to ensure that MPs only claim what is necessarily incurred to carry out their Parliamentary duties. I would ask members to ensure that in their own interests they only claim items which sensible constituents will think reasonable. We all need to realise that the public in this period of economic difficulty will expect us to be more cautious than in the past about what we can claim. It is not fair to seek to pressurise the arbitration of junior officials in the Fees office in substitution for a member’s own judgement of what is right and defensible. We will await the Kelly Report later this year before determining on a major reform of the system, designed to lower its cost and to increase the transparency of the whole process.

“The public are not convinced that this Parliament is doing a good job or providing value for the large sums spent on it. We need not only to control our costs, but to be more successful at examining the conduct of public administration. We need to demonstrate that the scrutiny we provide to legislation is sufficient and produces better law. With that in mind I am holding talks with representatives of the government to see how we can ensure that major changes of government policy are always announced first to this House in oral Statements and that less important matters are always reported in writing in a timely way. I will ask how we can manage the timetable more effectively to give Parliament the time it needs for the important issues and for the most contentious items.

“I will point out to the government that this is Parliament’s wish, as many Labour backbenchers join with memebrs of other parties in wanting Parliament to have a proper chance to consider the government’s measures and actions. I will remind Ministers that they too,as Parliamentarians, should want that. Government Ministers will be given plenty of time to set out their case, so they should have nothing to fear from such changes. Government Ministers should remember they too, one day will return to being backbenchers.

“I have asked the police not to continue investigation of any leak of the expense details to media outlets who observe the need to avoid publication of sensitive information affecting members’ security. “

The first thing you do when trying to control spending in a near bankrupt company is to stop hiring people.

Looking at the Jobs pages this week-end, the public sector still thinks it can hire as many as it likes to do as little as it likes.

Take the case of Aberdeen City Council. They advertised for a:

Director of Enterprise, Planning and Infrastructure £107,000
Project Director, Economic and Business Development £90,000
Director of Housing and Environment £107,000
Director of Corporate Governance £107,000
Director of Education £107,000

That’s more than £500,000 in salaries, before you add on the NI, benefits in kind, pensions, secretaries and the rest and before they put in their expenses. You could certainly take 20% off that lot by amalgmating two of the posts into one. The first three will be tripping over each other one many a project and making it slower and dearer. Can’t they make do with the people they have already got, promoting the odd one if they need to fill a major post?

Or take the case of the Environment Agency. They are advertising for regional Directors on packages of up to £110,000 each. They dare not tell us how many they want to hire. Most of us would like them to spend the money they have earmarked for that on some work to ease the flooding problems. Let’s have none of these.

At a time when manufacturing comapnies in the West Midlands are having to sack many people to be able to pay the rates and the other mandatory taxes, is it a good idea for Advantage West Midlands to be recruiting a Corporate Director Resources for a six figure salary, or for the West Midlands Manufacturing Advisory Service to be offering more than £90,000 a year for a Chief Executive? Manufacturing companies need orders, not advice paid for out of ever rising taxes. Stop this waste.

According to the polls which modern politicians normally follow slavishly, the public wants a quick 20% off public spending, so we get back to living within our means.

The public are right that that is the order of magnitude if we wish to curb the borrowing. 20% off this year’s spending – or next year’s – would not quite get us into the black, but it would eliminate most of the growth of the national mortgage.

The politicians are still far behind the public. They are unlikely to do this, preferring on this occasion to argue with the public and the polls because they will not like the message.

The politicians are unlikely to come up with anything so radical. The government is still in spend, spend , spend mode. They are still telling us that it is all essential, and that cruel cuts would hurt. Any MP who has the audacity to say to us now that all public spending is necessary should be greeted with a chorus of two words – “MPs expenses”.

MPs expenses are just the visible small top of a massive iceberg of wasteful and needless expenditure. The CEOs of Councils, quangos and Whitehall departments preside without the same scrutiny over collosal self serving and wasteful expenditure of a kind no competitive company would support.

I will be setting out in further “Wasteline” pieces what can be done about this. The first 10% off public spending could be painless for the public and popular. The tragedy is the government still does not get it. They still have not even offered to cut their own MPs expenses, let alone get to grips with the rest of the monumental waste. We need a recovery team to move in, versed in the skills of company turnround, to control spending before we hit national bankruptcy.