Category: Blog

When I first heard the news that the EU-Africa summit would produce a declaration to promote democracy at its heart I marvelled that African dictators had a sense of humour forcing this statement onto a reluctant EU. The EU after all is famed for ignoring the wishes of voters at every turn. They tell countries that hold referenda to re-run them if they reach the wrong answer. They work with secretive governments to throttle promised referenda at all costs.

Then I guessed it was more likely the EU, with its usual brass neck, presumed to telll Africa democracy would be good for them whilst ensuring it was suppressed at home. The EU did not raise an eyebrow when the North East of England voted down regional government and the UK government carried on with it nonetheless, because regionalism is an EU idea. The EU doggedly pursued the development of its Constitution that both France and the Netherlands had voted down. It has conspired to deny both countries and the UK a referendum on the slightly revised version it now insists on. The EU always wants a second referendum if some European power grab is voted down in a first anywhere in the EU. The EU can never understand the word "No" about its plans to take power away from European peoples.

For once I agree with Gordon Brown – he was right to stay away from this conference. It was a pity that the UK was still represented. I see no advantage in the world being told of the importance of democracy by the likes of Mr Mugabe.

Why is the EU so blind to the follies of its position? Is this the same EU that lectures us all on the need to curb climate change? If it is the most serious challenge facing the planet why organise such an expensive junket for many politicians and advisers to fly to, burning carbon on the way? Going from jet to limo to 5 star hotel does not set a good example to the rest of us who are told that taking the family saloon to Tesco is bound to wreck the planet.

Is this the same EU that imposes agricultural protection on the 27 member states with a view to stifling African agricultural development by closing or restricting our markets to them ? Signing a declaration that we want more trade with Africa does not remove the main obtstacle, EU agricutural trade restrictions. It’s just more warm words and humbug.

Is this the same EU that imposed a travel ban on Mr Mugabe because his regime offended even the EU by the magnitude of its assault on civil liberties.? If a travel ban made sense last month, why could it suddenly be lifted this month when there was an EU boondoggle? Doesn’t it show there is no morality or backbone to EU foreign policy, no wish to apply pressure to evil dictators? What is the point of posturing against him one month, and welcoming him as a valued friend and adviser around the conference table the next?

Why is the EU spineless when dealing with dictators, yet spiteful when dealing with the democratic views of the people like us who pay its bills? When will they learn that we are angry about the way the European political elite wastes our money, ties us up in bureaucratic and legal knots, and embarrasses us on the world stage. We want an end to its artificial regions, an end to its expensive posturing, an end to its refusal to listen to the views of the taxpayers.

This summit makes the EU look discredited and dishonest. If they cannot take a stand against Mugabe, if they sign up to democracy when thwarting it at home, people will conclude they cannot be trusted.

Please can we have our country back? We want to make our own foreign policy decisions.

Yesterday I visited Williams F1 headquarters at Grove in Oxfordshire.

There is a great deal the British public sector and some things private manufacturing can learn from the pursuit of excellence by F1 car makers.

The most impressive feature of the company was the total dedication of the workforce on winning. They all know what winning means. They wish to make the fastest cars on the grid. They define their own tasks in terms of tenths of seconds anything they do is assessed by whether it will help make the next car go faster.

The messages of focus, quality, honesty and innovation come from the top, led by the inspirational Sir Frank Williams. Each person has substantial delegated authority to make decisions and get on with their tasks, as speed is of the essence in all they do as manufacturers. They have to design and build a completely new car every year, and rebuild and adapt the cars for every race. Senior managers are kept informed and can make important decisions rapidly.

The production areas are clean. Although they are cutting metal and using cooling fluids and oil, they ensure all floors and work surfaces are kept dirt free.

The production areas are uncluttered. There is no stock of parts and materials and discarded components littering the workplace.

There is a can do approach. People do not say they cannot change one of the car’s components this week because they are going on holiday or a bit busy. If it needs changing for the race, someone in the team changes it.

All the money they raise is used to refine and improve the cars it is a kind of not for profit.

If you compare this with the NHS, the contrast is stark. I appreciate there is a big difference in scale, but only because the NHS tries to manage most things from the top down, declining to give real authority to individual hospitals and surgeries. The myriad performance numbers means people in the NHS do not know what wining means. Why doesn’t the NHS just ask every staff member to understand that winning means ensuring as many patients as possible get better as quickly as possible that should be their equivalent of building the fastest car? If men in a car plant can deliver a required standard of cleanliness,can’t we expect the same of staff in a hospital? If it is possible to combine senior management making or agreeing all the big judgements with rapid decision making and devolved authority at an F1 factory, can’t we do the same in the NHS?

Williams like all F1 companies have three time horizons for innovation. The first is as short as fortnightly in the season. They will introduce new features and adaptations for each race. The second is annually, designing a completely new car for each season. The third is longer term, introducing major breakthroughs by harnessing new technical ideas. Currently the industry is working on harnessing kinetic energy to supplement the energy generated by burning fuel in the engine.

The F1 teams are innovating, creating lighter, more aerodynamic and safer vehicles. Their use of materials and design can inform mainstream motor manufacturers in making lighter and safer cars, which will be greener cars. I was asked to lift one of the spare wheel and tyre sets for an F1 car. Remembering the weight of saloon car versions I was surprised at how easy it was to lift it was more like a heavy beach ball than a spare wheel. Most of the innovations to make an F1 car go faster would make a saloon car run more fuel efficiently.

Manufacturing has got much more efficient under the pressure of global competition, but larger traditional manufacturers can still learn things from F1 about speed to market. Which motor manufacturer can design and build an entirely new car in a year?

Vince Cable is given endless airtime by the BBC to rubbish any bid or serious interest in Northern Rock and to propose nationalisation. It is typical of the BBC’s bias that they invite him, and refuse comment from those of us who have positive proposals to salvage the taxpayers money.

Mr Cable’s wish to nationalise is fatuous. His logic is flawed. He tells us rightly that ??30 billion at risk for the taxpayers is a lot of money,and the risks are considerable. He then concludes that the taxpayer should put ??100 billion at risk by taking over the whole balance sheet of Northern Rock! If he thinks the Rock is a bad bet, why does he want to more than treble it?

Nationalisation is the last thing we should want to do. Northern Rock’s assets will be worth more when the credit squeeze abates. The issue is how to get them through the worst part of the squeeze at least cost to the taxpayer. Nationalisation would maximise the risk and cost.

What we need is a Bank of England which acts as a strict bank manager, rationing the credit, setting repayment schedules and monitoring the use of the cash. They should not be letting Northern Rock put up pay, award bonuses, or make other unnecessary payments. Every action at the Rock should be husbanding cash, to maximise the repayments. Meanwhile the taxpayer needs to take plenty of collateral or asset protection. If we took over the lot, we would have to suffer the losses on the less desirable assets. That is not a game taxpayers should be playing.

Mr Cable should be ashamed of himself, rubbishing every sensible effort to save the bank, and recommending such a dangerous and stupid approach for the taxpayer.

The authorities stumbled forwards yesterday as they sought to tackle the twin and related crises of Northern Rock and broken money markets.

The 25 basis point (0.25%) off the MPC interest rate was a belated and hesitant step in the right direction. It just goes to show if we all shout loudly enough at our so-called independent MPC they throw their economic essays out of the window, eat the words of their recent speeches, and change their minds. We need to do it more often.

Cutting interest rates on its own is not going to correct all the damage to bank balance sheets that the MPC and the regulators have done,but it does help begin the repair job needed. It means fewer people defaulting, which in turn means a better value in the market for packages of loans, which in turn gives stressed banks another option to raise cash.

The government should now tell the international community it cannot press on with the Basel II regulations, which compound the folly of encouraging banks to take on off balance sheet instruments which lie behind the current international banking difficulties.

The arrival of the Olivant bid for Northern Rock has perked up some of the shareholders, who think it offers better value for them than the Virgin bid. It means there is now some healthy competition to take over the distressed bank.

The tragedy is the failure of the government to use this situation to get a better deal for the taxpayers. According to today’s media accounts of the rival bids, the improvement in Olivant over Virgin has come in the terms to shareholders, not in the terms to the taxpayer.

The government is making us all pay for its own incompetence. Either it should have set out tough requirements for repayments in advance that all bidders had to hit – tougher than those offered so far, or it had to demand that bidders bid on how much money they could repay how quickly and tell the shareholders that otherwise the government would demand early repayment.

The government has failed in its duties to both taxpayers and Parliament.
It has failed to act as a responsbile bank manager, lending cautiously, taking plenty of security and insisting on repayment timetables.
It has failed to tell Parliament – and the market – what it expects from an owner of Northern Rock.
It has failed to tell Parliament how much it has lent on what basis, or to seek Parliamentary approval for this massive sum.

Putting some fo these mistakes right would still help the government dig itself out of the hole, as well as creating a more orderly market in Northern Rock’s shares and expediting the auction process.

Presumably Virgin now loses its preferred bidder status, unless that had some legal force we have not been told about.

The new Australian PM changed his policy rather than the climate when it was revealed to him that supporting a 25% cut on 1990 carbon emission levels by 2020 would lead to large rises in electricity prices.

He is yet another of these politicians who thinks it is warm and friendly to say he wants to do something to curb carbon, but who finds the policies needed are too unpopular. Just like Labour here, they talk the talk but do not walk the walk.

The answer is to encoruage and incentivise people to be burn less energy, not pillory them with taxes and regulations. The public does not believe climate change theory sufficiently to welcome large increases in energy prices through higher taxes, or taxes on particular lifestyles that they have adopted.

It was music to my ears this morning to hear a Conservative spokesman saying that we should reward people who save energy or generate their own power, rather than hitting those who dare to burn some fuel to go about their daily business.

Labour and Liberal believe in more tax and more regulation. Conservatives should believe in more incentive, and the liberating power of technology.

At the same time as Greg Barker was planning his encouragement for generating more at home, I was talking to Phil Woolas, the Water Minister, about how we could collect and use more of our own water at home.

I have installed the water butt to collect water off my roof, only to make the obvious discovery that my roof produces far more water than the butt can take. It also means I have plenty of water for the garden when the garden is sodden!

Why not encourage more and cheaper systems to collect roof water and to use it for flushing loos and washing cars. We really do not need to be using high grade drinking water for such purposes.

Oil prices down – you read it here first!
House prices down.
Commercial property prices down.
Mortgages down.
New borrowing for everyone down.
People’s spending squeezed.

How can the Bank think this is the background to higher inflation in a year or so?

Overall price increases are still a bit above target – that’s because the Bank and the MPC got it wrong a couple of years ago, keeping interest rates too low for too long. It is also because the government owned or influenced monopolies like railway fares, Council tax and fuel tax have gone up.

Yesterday sterling fell and the UK Stock market rose sharply. Markets are clearly expecting an interest rate cut today.

Whether the Bank does or does not cut rates, expectations of more cuts will build up in the days ahead, as no-one in the markets thinks the Bank can remain unconcerned about what is going on in the banking sector for much longer. Today’s problems for the banks are tomorrow’s problems for everyone else, as money makes the economy go round and banks supply the money.

As someone who opposed the 28 day period of detention without trial I am implaccably against an extension of this.

The government has run into huge difficulty trying to persuade enough people to support the extension they crave. They have rumoured they plan to increase it substantially, floating various lengths of time. Today we learn that they are now thinking such an extension should only take place if Parliament approves it when needed.

Why then take action now about it? Parliament can always vote for emergency powers in extreme circumstances. There is no need for such action today. The government still has to produce a single case where they think they could have stopped a terrorist incident or obtained a conviction if they had been able to detain someone for longer without charge or trial.

Guantanamo Bay has been a blot on Western democracy. Internment in Northern Ireland did not stop the violence during the troubles. Why is this government so blind to the need to protect our liberties? Why does it wish to make endless extensions to state power? Why can’t it see how unpopular it is, even if it can’t see how wrong it is?

My colleague Mark Pritchard obtained a debate in Westminster Hall yesterday on the way some authorities in the UK wish to play down Christmas as a Christian festival, replacing references to the birth of Christ with more to the success of Mammon.

He spoke well, to a largely empty chamber. MPs do not regard Westminster Hall as a proper substitute for the main Commons Chamber, seeing it more as a reminder of how the government has damaged our Parliament, limiting the time and the topicality of main Chamber debates to avoid too much scrutiny. I was therefore pleased that the BBC picked up Mark’s debate and gave some of the ideas from it wider coverage.

Many people in the UK, of all faiths and none, understand that Christmas without some recognition of the birth of Christ is absurd. The lights, decorations and spirit behind the festival should reflect the origins of it. The general message of thinking of others and bringing families together extends well beyond Christians in its appeal.There has been a lot of nonsense talked about Christmas. Some have renamed it winterval?, and some companies and institutions have taken all reference to the Christmas story out of their cards and messages. It’s like seeing Hamlet without the Prince.

I am glad most of our primary schools still put on their nativity plays and sing carols. I am delighted that many of the cards I am receiving still manage to say Happy Christmas whilst illustrating the traditions of the holiday season. Most people of other faiths and of none appreciate that this mid winter break represents the coming together of the Christian celebration of Christ’s birth with older pagan winter festivals. The plum pudding and the groaning tables go back a long way and are enjoyed by most, whilst the cards, presents, pine trees and Christmas cakes were embellishments of the Victorians who saw a commercial opportunity with the growing wealth and incomes of their society. They wanted to make the tills ring as well as the Church bells. Our retailers are hoping that is not just a fairy story this year.

It is a special time for children, who become excited by the thought of presents and by the magic of the stories the birth of Jesus in a manger, and the folklore of Santa Claus and his famous reindeers. They accept and enjoy the glorious muddle of these traditions for what they are great fun, a welcome respite during the colder and darker part of the year, and days of religious significance for those who do believe in Christ.

If the Monetary Policy Committee of the Bank of England wishes to be anything more than overpaid members of an academic seminar watching as the money markets go their own way, they need to cut interest rates tomorrow.

Market rates are almost 100 basis points or 1% above the MPC’s rate. Money policy is far too tight. The MPC is not in control of the markets.

If the MPC dithers and concentrates on the short term increases in prices, it will make the credit crunch worse. It will be as incompetent as the rest of the Brown government. House prices are falling, commercial property prices are falling, consumer confidence is falling. What more do they want? How much damage do they want to do?

Surely by now MPC members have learnt that changes in interest rates have an impact many months into the future. The inflation we are living with today is the result of keeping interest rates too low many months ago, and the consequence of ill considered banking regulations that encouraged off balance sheet excess. When will the regulators of the world revisit their folly, the Basel rules? When will they start to take some of the blame for the mess?

Today the credit crunch is the result of the unravelling of that mistaken banking regulatory model, and the result of interest rates that are too high.
The Bank of England, shorn of its old responsibilities to manage the public debt and to monitor the day by day balance sheets of the clearing banks, has lost its touch in the money markets. Gordon Brown’s botched “reforms” of the Bank of England did not make the Bank more independent, they made it less powerful.

IT IS VERY EASY : CUT RATES, CUT THEM BY AT LEAST 50 BASIS POINTS, CUT THEM NOW.