Norman Tebbit

This is an article I was asked to write for City am
Norman Tebbit was a towering figure in the Thatcher Cabinet. I worked closely with him as Margaret’s Chief Policy Adviser in the middle years of her government. He was often the  Cabinet Minister around the Cabinet committee tables who went straight to the heart of the matter under discussion. He sometimes  had the sharp turn of phrase to encapsulate the main point or difficulty so well.
He was a loyal supporter of the Prime Minister, sharing an outlook on life with her. He communicated often and well with the wider world and was a fierce exponent of the government’s message. Like Margaret, he had a mission to improve the UK. He spoke the truth as he saw it, and stuck to a strategy designed to bring it about. People knew where they were with Norman, and  understood what he thought was right.
Norman came from a less privileged background than the public school men  in the Cabinet. A former airline pilot and trade Union member of BALPA he had decided to break closed shops which could harm members . Margaret Thatcher made him Employment Secretary and he put through the 1982 legislation. The main aim of the Conservative  reforms embedded in several pieces of new law was to give more voice and vote to Trade Union members. Every strike would need a ballot of approval, to avoid Trade Union bosses calling a strike which the members did not want.  Closed shops had to be supported by the majority.
When the Coal Board got into dispute with the Miners, it was Norman who pointed out the key  issue for the Board was to move coal rather than to mine more. Stockpiles were high and the dispute revolved around attempts to prevent lorries collecting the coal that had already been mined. Norman took a tough line, reinforcing the view that this was a commercial dispute between Board and miners where government should not intervene to find a negotiated settlement.
My first serious exchange with him came at one of the early  Cabinet Committee meetings where I briefed the Prime Minister. Not knowing her well enough at that point, I prepared a hard hitting private paper for her on the many failings of the management of British Leyland, why the car industry under public ownership was loss making and declining, and how we needed a  major change of policy. I attended the meeting to see how the brief was used, only to be shocked that she read out large chunks of it with obvious pleasure. All the room knew who must have written it, as civil service papers did not usually sound like that. Norman was livid, as he took the whole thing as a personal attack as his Industry department was responsible for the policy. I spent time afterwards trying to reassure him I did not intend it as an attack on him, and would be happy to work with him on a policy that could salvage more of our car industry which had been in freefall since  the 1970s. I learned to tone down my messages to Margaret as clearly they were getting through.
Norman’s success as a Cabinet Minister at Employment then Industry was overwhelmed by the Brighton bomb. He himself was badly injured, but recovered. His wife was permanently disabled, changing their lives for ever. It meant he gave up a Cabinet post in 1987 and retired from the Commons in 1992.
When Margaret resigned I went with some other friendly MPs to his room and asked him to run for the Leadership of the Conservative party. He was to me and others the natural heir to take over. He told us he could not do that, given the need to look after his wife. It was a sad moment to accept the reality that his life had been changed fundamentally by the terrorist act. It was typical of Norman that he put loyalty and love to his wife before other considerations.
Our country owes Norman and his family a debt of gratitude for the service he gave, and for shouldering the burden of injury and disability in his home life as a result of their public lives .

The EU is not even happy with one out,one in

The PM is wasting his time trying to get a one out, one in migrant deal with France. One for one will not cut the totals drastically in the way the public wants. We should not have to take more migrants we agree to take just because more illegals have turned up by boat.

The PM presumably thinks being able to return a few illegals in exchange for others might act as a deterrent to people risking the small boat trip. The truth is much of the risk has been removed by the French authorities accompanying small boats out of French waters and UK border force then providing a safe taxi service. All the time lots of people want to try the small boats numbers will far exceed France’s willingness to take illegals back.

Meanwhile other countries in the EU are querying the French idea saying they do not want to accept those France might take back. As they have common borders it is a matter of concern to them.

The PM has at last understood he needs to be able to send illegals elsewhere to act as a deterrent. That  was the point of the Rwanda scheme. This French idea is not up to the task.

Labour will run out of other people’s money to spend

The 1974-9 Labour government ran out of money by 1976 and had to go to the IMF to borrow. That entailed agreeing to cut spending and sell some assets as the state had over extended. Tax rates were high, driving rich and hard working people abroad in the brain drain. Borrowing was excessive. Interest rates were very high. The government had to borrow some money at more than 15% interest rate. The country effectively  went bust. The Labour government fell thanks to its economic disaster.

The next Labour government elected in 1997 followed Conservative spending and borrowing policies for its early years, which worked well. Then it decided it should spend and borrow more. It worked with the Bank of England on an asset bubble with excessive bank credit driving up prices and creating excessive options, leveraged funds and futures. By 2008 it was clear they had overdone it. They created a credit crunch which brought banks down and meant once again the state ran out of money. The great recession followed.

This time round they are seeking to overdo the spending and borrowing right at the start of their term. They have spent and wasted too much, with plans   to borrow £180 bn more than the Conservatives planned over five years. How long before markets teach them another expensive  lesson?

US goes for low taxes, UK for high.US will win the growth stakes.

US GDP per head of $83,000 is already well ahead of the UK at $58,000. It is almost double the EU at their pathetic $43,000.

So why does the UK government want to lock us into a failing poverty machine called the EU instead of adopting US policies which promote growth and greater prosperity?

The US  has just gone for lower taxes. No tax on tips and overtime. What an incentive . The UK with its growth busting tax raising budget last year is planning another higher tax teach the rich a lesson budget.There will  be fewer and fewer rich to do detention in the government low growth school.

Why are so many in the UK establishment wedded to the notion that tying us to low growth low income EU will make us prosperous? Why do they not see the US has outperformed the  EU all this century to date. With the tax cuts coming and the dominance of US digital and AI the US  will again this Parliament beat the EU and UK in a big way.

Dear electricity is not caused by the gas price

The government does not understand the energy market. They say if the market stopped making gas generated  power  the  price determinant for electricity all those renewables would take the price down.

Instead it would usually put the price up. Most renewables are supplied with a guaranteed price under the old renewable Obligations scheme or the  newer contracts for difference.For most years of these schemes the renewables price is higher than buying gas based electricity. There are also the other green taxes and subsidies putting up power bills.

Renewables are unreliables . Solar delivers on average just 10% of stated capacity. Onshore wind 30%. Gas power is made dearer by having to keep it on stand by. The UK has dear electricity because it out in so many heavily subsidised wind and solar generators. It now faces a huge bill for more grid and storage to try to get them to work better.

Ten year plan for NHS needs miracles to work

The ten year plan cuts the numbers of extra staff needed in the next ten tears from the much advertised  and long delayed 2023 Manpower Plan. It says it can do this because the NHS after six years of plunging productivity will over the next three years suddenly deliver 2% per annum productivity growth, with more to come over the following seven years.

How will this happen? Is this based on less recruitment, staff reductions, or a big surge in output?

The Plan says government will end past practice of bailing out Trusts who run out of money in year.

How will it do this? Will Trusts running out of money have to turn patients  away and sack staff?

There are three big themes.

1. More to be done in the Community, less in hospital.Money will  divert from hospital trusts to Community care. The government will set up Neighbourhood health  centres which will combine GP consultations and prescriptions with more treatments . They will first be rolled out in deprived areas. How will this work better than multi GP surgeries? Who will want to undertake basic surgery there and how will they be remunerated? Will the facilities all be owned by the state, unlike many GP surgeries? How long before sufficient exist to make a difference to workload at A and E departments?

More prevention, less sickness. That is what successive governments have wanted. The measures look puny, concentrating on food retailers and alcohol and smoking issues as an indirect way to get people to drink, smoke and eat less. The health  crisis is seen with obesity at its heart. Limited response to the surge in demand for mental health services

Digital, not analogue

AI is seen as the answer to most things.It is implied it will boost productivity and quality. It will empower patients who will know more and control more through a powerful NHS app showing them their records and giving them better access to care.

So how come the NHS will quickly be able to come up with a patient friendly digital  control, information and access system that all parts of the NHS will adopt? Is this to be centrally designed and mandatory? How big a project and contract? If the boost to local and community health decisions and delivery is genuine how will the NHS ensure common functioning across borders?

Where AI is to be used to make medical staff more productive  and to raise quality of diagnosis and surgery, how will the medical protocols be amended? Will the medical profession endorse an enhanced role? Presumably trained staff retain responsibility and can override computers  and robots?

It reads more like a mood board or general essay than a working plan about to be unleashed.

 

The great green investments

As readers know, this site does not provide investment advice. It is,however, a site that analyses public policy and public investments.

Over the last two decades advanced country governments have used subsidies, managed prices , tax breaks, direct state investment and regulations to achieve a large surge in capital spending on renewable energy, especially wind and solar electricity.

They have also used higher taxes, windfall  taxes, regulations, managed prices and bans to put their oil and gas industries into decline. President Trump in the US has opposed this approach. China which claims to back net zero has expanded  its own use of coal.

So what have been the investment results so far? Taking the  Clean Energy Index  and comparing it with the Global Energy Index  whose top four holdings are big oil companies representing 40% of the index we see both long term and over the last  four years the oil rich index has greatly outperformed the clean energy index

Global Energy                   2021      +43%   22  + 42 %   23  + 4%     24 -0.9%

Global Clean energy         2021   – 24.1%    22  – 5.6%      23 – 20.5%  24 -26.1%

 

Figures from ishares website

Global clean energy has provided a return of minus 5.5% a year since 2007 prior to bank crash. Global Energy produced a return of minus 0.3% a year since 2011, a start date after index recovery from banking crash.

Past trends are not necessarily guides to the future. They do show us throwing so  much money at renewables and transition has led to no longer term returns on quoted energy investments, and to a last four years when the Ukraine war helped drive oil and gas prices up in the west giving fossil fuel companies a boost.Each year the world has used more fossil fuel despite government attempts to stop it.

 

The collapse of industry continues apace

Whilst Labour MPs were undermining their government over its clumsy welfare cuts, another UK refinery went bankrupt.

A hand wringing Labour Minister blamed the management and promised to get involved in either finding a new owner who thinks they could turn a profit, or looking at some other use for the site. This latter offer implies acceptance that 440 good industrial jobs will go as the refinery closes. The Minister claimed credit for a government meeting with the industry prior to this collapse. Clearly the likely meeting  messages from the industry about high energy costs were ignored by a government determined to deindustrialise us to hit unrealistic carbon targets.

The predictable collapse of refineries, ceramics, vehicle manufacture, petrochemicals and other energy dependent industries is proceeding apace. The government sheds crocodike tears and blames others. The prime cause is sky high energy prices. The main cause of them is the high taxes and subsidies needed to supercharge decarbonisation. It makes us hopelessly uncompetitive. It also adds to world CO 2 in a cruel irony of total policy failure.

 

Motability

Some of you have written in querying the Motability scheme. This allows people on disability benefit to acquire a new car on  a lease from the Motability  charity. For people on the highest level of PIP mobility payment there are 48 cars to choose from where the Pip payments will cover all the lease costs. The charity is free of VAT on buying the new cars and those on the higher payments can qualify for Vehicle Excise exemption.

The original idea was for government to allow tax breaks to cover costs where a physically disabled person needed expensive modifications  to a standard car for a wheel chair and or different controls. The Motability  charity also now qualifies for the tax exemptions to lease a standard  car to a benefit  recipient.

Motability  now accounts for 20% of all new  car purchases in the UK. People can lease dearer cars on the scheme by putting in additional money. The car has to be returned if the individual loses benefit entitlement.

What changes are critics wanting to see? Should the scheme be limited to vehicles needing modification? Should all Motability cars be bought VAT free? Should they be for the disabled person to drive and not for others in the family?

One year on. A lot gone wrong.

Unemployment up

Inflation up

Dear energy got even dearer

New UK oil and gas stopped for the year

Ban on new petrol cars brought forward to close UK factories sooner

National Insurance hiked for self employed and employees, hitting jobs

More tax on the rich led  to many more leaving the country with loss of tax revenues

Disabled threatened with benefit loss, then a partial U turn

Refusal to enquire into rape gangs delays getting to truth

Gave away Chagos needlessly

Committed to paying Mauritius for 100 years

Gave in to EU demands with no legal agreement to any improvements for UK

No growth in their first six months thanks to run up to budget and budget tax rises. Further fall last month after some Q1 growth

Claimed they inherited  too much spending and borrowing, only to make very large increases  in both