Category: Uncategorized

SAFER ROADS WITH LESS CONGESTION

Low Cost and No cost options for government to improve UK productivity and ease the jams

1. Rephase traffic lights. Where there is a main road and side roads, the main road should have green  priority with traffic sensors for traffic from side roads.
2. Remove all red phases for traffic at traffic lights
3. Allow turn left on red, treating the red light as a Stop sign
4. Require utilities to place new and replacement pipes and cables under pavements in prepared ducts with access points
5. Require more off road parking for new housing estates and all commercial development
6. Require state schools to put in pull off areas or reserved parts of car parks for drop off and pick up away from the highway
7. Create right turning lanes at busy junctions where space permits
8. Replace light controlled junctions with roundabouts
9. Remove traffic lights from roundabouts, or make signals part time for peak only

Higher cost options

1. Create segregated cycle lanes away from the highway where possible on main routes
2. More bridges over railway lines, including replacing level crossings where possible
3. More bridges over rivers in main towns and cities
4. Pedestrian bridges/underpasses to allow crossing main routes safely and quickly

I will be writing at greater length about some of these ideas after Christmas.

Yesterday evening I was invited by Sky to discuss the current wave of strikes in baggage handling, aviation, on the railways and at the Post Office. I naturally urged management and employees to sit down to sort it out. People do not want their Christmas arrangements messed up by strikes. It shows a singular lack of seasonal goodwill that so many groups of workers want to take it out on their customers at this time of year.

Some say the transport strikes should  be made more difficult by legislation. This government has recently changed the law in the Trade Union Act 2016. This now requires half of those eligible to vote to vote in a valid strike ballot, and for 40% of those eligible to vote for strike action, as well as a majority of those voting. It also requires the Union to hold the strike within six months of the mandate, and to seek renewal of the mandate if the strike drags on.  The strike ballot has to provide a clear statement of what is at issue in the dispute.  Do you think this is fair? Does it go far enough in seeking to ensure that there is proper support for a strike and that the workforce does know what is at stake?

The Southern Rail dispute has become embroiled in politics, with a Union leader saying he wants to use the strike to undermine capitalism and the Conservative government. It is a strange dispute, as the employees are being guaranteed jobs at no less pay from the changes the management wish to make. The Union accepts driver operated doors on trains on other routes, but will not accept them on Southern routes.

Who do you blame for the dispute? What if anything should the government do to make settlement more likely?

If I went  to an auction with a business partner we would not spend our time at the auction bidding against each other.  We would agree the best course of action for buying the item at the lowest price, and stick to that. Only one of us would bid. We would not advertise in advance how much we wanted the item or what our bidding strategy would  be.

Many in the UK think we do need to negotiate a settlement over trade and residual financial matters with the EU when we leave. Yet there are businesses, senior officials past and present, many Opposition MPs and others who ought to know better, trying to tell the other side in advance how generous our offers might be, and trying to bid us up all the time to make better and better offers!

There is no point in making any offer until the negotiations begin. Nor should we offer to pay for things that are properly ours without paying. We have every right to leave the EU, under our own laws and under the Treaty we signed. We have every right to take back control of our laws, our money and our borders without having to pay for the privilege, and without having to dilute that control.

The only thing we need to discuss with our former partners is what new relationship we will have on departure. The main part of that is trade. I see no need to offer money or EU control of our borders in order to carry on importing from the continent. I think they will  be all too relieved to be able to carry on exporting to us after Brexit. Some people in the UK need to wake up to the reality of how you do well in an auction or a negotiation. They also need to understand that no deal is better than a bad deal, as there is little we awnt from the EU. Our trade is not at risk, and can be pursued successfully one way or another as soon as the rest of the EU decides whether they want to pay tariffs on their exports to us or not.

Western media have given plenty of coverage to the loss of life and great damage  in Aleppo, as the Syrian government forces aided by Russia drives out rebel fighters. Heart rending pictures of civilian children caught up in the war, of fleeing non combatants and bombed medical facilities has made many ask what can the West do  to help bring the violence to an end and to assist with humanitarian  aid.

At the same time as we watch this tragedy, we see and hear little of the battle for Mosul in Iraq. There the Iraqi government forces, assisted by Kurdish troops and western planes and intelligence are seeking to recapture this large city from Isil and other rebel forces. It is said that around 6000 ISIL fighters are resisting far larger forces, led by the Iraqi Golden division of 10,000 well trained and armed professionals. The battle has been raging for three months now, and forecasts that the city would be back in government hands by the year end look optimistic. More than a million civilians are still living in the city, with reports of ISIL using some as human shields, and other reports of considerable death and damage being wrought by the war. There are especial problems with water supply leaving people at risk of disease from unclean water.

In October the UN warned that “There are real fears that the offensive to retake Mosul could produce a humanitarian catastrophe resulting in one of the largest man made displacement crises in recent years. ” It is I trust good news that there have been no further such reports, though the limited news from the battlefields implies there is still a lot of destruction and loss of life as a great city is fought over intensely. Could our news organisations bring us up to date?  How will the great tensions between Sunni and Shia be contained in the city, as the Iraqi Army aided by Shia forces advances?

Giving the cold shoulder to the Prime Minister was juvenile. Refusing to reassure all EU citizens living in each other’s countries that they can stay after Brexit was morally repulsive.

I assume even the EU would not stoop so low as to demand the departure of UK citizens from othe EU countries once we leave. It would be against decency,morality and probably international law. So why don’t they just say so? Their refusal shows the PM was wise not to assume they would.

The UK has made clear it is happy for all legally settled EU migrants in the UK to stay. So why can’t the others say the same about British migrants?

At the same time, why can’t the rest of the EU reassure business that they have no wish to damage their trade with us?Again they put their own institution above the needs and wishes of businesses, employees and customers around their Union.

It certainly strengthens the case for leaving. These people clearly do not want the best for their citizens. They use them as pawns in their macabre political game. I thought the EU’s idea was to  take our money in order to give us some service. Once again it looks as if the opposite is true.

Most people agree the  UK needs to do better at providing social care. Some think it is just a case of increasing the money to pay for it by more than it has been increased in recent years. Others say there needs to be reform of the way public sector care is organised and provided. Underlying the debate are two major issues which need discussion.

The first is how much should the state pay and how much should the individual pay? The tripartisan approach for many years has been to say  healthcare should be free, but living costs are down to the individual. If the individual has little capital or private pension income, then the state will pay the living costs as well.

Some say the state should take care of more of the living costs of more people. This would require substantial tax rises to meet the bills. It would mean that instead of selling the old person’s home when they move into residential care to pay the living cost bills, the money from the estate would be preserved and pass to the children. People ask why is it fair that someone who has saved and been careful all their active lives has to pay their own living costs, whereas someone who has lived beyond their means will be paid for?

Others say the current system is fine in this respect. If someone is well off, why shouldn’t they use their own assets and income to pay for their living costs? If someone cannot afford a reasonable standard of accommodation and food, don’t we have a duty to be good neighbours and to help pay?  This is a cheaper solution for taxpayers.

The second issue is internal to government. At the moment central government pays for and runs the NHS, whilst local government pays for and runs much of the social service provision. It is true local government relies heavily on national government grants paid for out of national taxes, but local taxes have a part to play in financing social care. Many people like the idea of devolution of power over policy and spending to Councils from Whitehall, yet when problems emerge in a local service the cry often goes up for government intervention. Quite often it is easier to blame the government for alleged underfunding, than to blame individual Councils for poor or unduly expensive provision.

The public is generally  not much exercised over who runs the service. They want a good outcome. The main problem with Councils running care and the NHS running health treatments comes at the borders. An elderly person who has been treated in a hospital often needs improved care services in order to be able to return home. Some Councils are reluctant to commit in a timely and sufficient way to the need to provide social care. The elderly person then remains in a very expensive hospital bed. This costs the state more overall. Someone no longer needing treatment occupies a bed needed for someone who does  require  treatment. It is often  against the wishes and interests of the patient, who wants to get home.

Any thoughts on what reforms are needed?

Those parties the electorate would destroy, they first drive into coalition. There is a very European pattern of political change. The traditional establishment parties of the centre left and centre right become unpopular in government, they are driven into coalition, and the junior partners in the coalition often become extremely unpopular as a result. Mrs Merkel’s Free Democrat partners are no longer a force in German politics, and her latest partnership with the SPD in grand coalition is harming their electoral appeal.

The bigger issue is the ability of the Euro and the EU scheme to drive the traditional parties out of government, and then to leave them struggling as minor parties with very few seats. Normally when a political party discovers than one of its main propositions is unpopular it changes its view and seeks to get back in favour with electors. To win again Labour in 1997 had to accept Conservative tax rates and spending plans. To win in 2010 Conservatives accepted the minimum wage and social legislation put through by Labour. What is odd is that time and again the strictures of EU and Euro economic policy, generating high unemployment and little or no growth, are rejected by electors only to be upheld as policy by the traditional parties that suffer from the backlash.

The fall in support has been massive for several of the leading continental parties. In Germany the Labour party equivalent, the SPD used to be able to win more than 40% of the vote and form a government. Today it languishes on 22% in the polls. In Italy the PdL centre right party won 37.4% of the vote in 2008. In 2013 this had fallen to 21.6%. Their left of centre opponents, the PD, also fell from 33.2% to 25.4%.

In Spain the centre right party PP fell from 44.6% in 2011 to 33% in 2015, whilst the centre left PSOE fell from 43.9% in 2008 to 22.6%. Worst of all has been the performance of the traditional parties in Greece, where the economic crisis has been the most intense. There Pasok, the Labour party equivalent, collapsed from 44% in 2009 to just 6% in 2015.The centre right New Democracy fared a bit better, falling from 45% in 2004 to 28% in 2015.

In each of these cases the old cycle of government switching between the centre right and centre left depending on economic performance and political skill has been decisively broken. Both main parties in each of these countries has backed the Euro and the full EU scheme. All have supported and defended it continuously, claiming there is no alternative. The electors disagree, and are busy searching for an alternative that might break out of banking troubles, low or no growth and high unemployment.

I just do not understand why once great political parties accept these policies, when they are so clearly life threatening to them as election winning organisations. Why have the normal rules of politics been suspended by the EU? Why don’t these parties want to improve the lot of their electors and get back in touch with their former supporters?

I am relieved that Southern Rail does not serve my voters. All too many commuters having been paying up to £5000 for their season ticket out of taxed income, only to discover the service is poor and often non existent, when there is another strike day.

The dispute is incomprehensible to anyone working in the competitive private sector. It is the fact that the train company has a monopoly and operates within a very controlled framework provided by the public sector, that it can indulge itself in the luxury of antagonising all its customers. They have nowhere else to go. They are prisoners of the system.

Apparently the dispute is over what duties a guard or train manager has on board the train. The company wishes the drivers to control the highly automated system of door closing and locking, as they do on other railways. The Unions say the guard needs to keep this duty. We are told no jobs will be lost if the management changes go through, and the passengers will get a better service. The Unions decline the offer and argue the train would be less safe if the driver works the doors.

Trains are best at moving large numbers of people at rush hour. Then the high capacity of a train coupled with the freedom from pedestrians, cycles and junctions that train track enjoys means it should offer the fastest way of getting into your place of work or back home again. The large numbers wanting to travel means the railway can offer a good timetable for rush hour periods, with frequent trains. The main constraint is the technology of our railway which limits the numbers of trains that can use popular track below the levels the demand would justify. It will take lighter trains, better brakes, and modern signals to increase the capacity of the commuter network.

In the meantime management and Unions need to learn to work with each other to give their passengers value for their high cost season tickets.

Many advanced economies, especially on the continent, have struggled since the crash of 2008-9 thanks to the failure to mend the commercial banks. The main authorities of the advanced world lurched from being far too lax with how much banks lent compared to their capital, cash and reserves, to being too tough. As a result we have had slow growth or no growth, depending on the relative weakness of the individual national commercial banking systems. The US and UK fixed their banks more quickly than the Euro area, but still demand levels of cash and capital that makes normal levels of credit expansion difficult in this cycle. On the continent in the recession ridden economies of Italy, Greece, Portugal and until recently Spain, past excess has led to a long period of credit starvation.

All this cramps growth and opportunity. No-one is suggesting the banks should lend more to individuals and organisations that can’t repay the last lot they borrowed. This credit squeeze is also preventing new loans to individuals and companies that are not over borrowed, and stands in the way of the normal use of credit to grow demand for larger ticket items, and to expand business capacity to respond to rising demand.

I have long argued that I would rather the governments and Central banks since 2008 had concentrated on fixing the banks, than on Quantitative Easing as a palliative for not fixing the banks. I can see that QE could be better than doing nothing. However, one of its adverse side effects was to lower long interest rates, making it more difficult for banks to make a profit. This delayed their balance sheet recovery, as they need more retained profits to provide the buffers against future losses they need before lending more.

The arrival of Mr Trump may change all this. It offers an opportunity to turn our backs on excessive austerity banking, and to find some possible agreement between the Europeans and the USA over what the next phase of world banking regulation should look like. Basel IV, the possible further tightening of demands for bank cash and capital, is in dispute now. At the same time Mr Trump’s team may soon develop proposals to amend Dodd Frank and the US bank regulatory code that came in following the crash. Mr Trump will want to expand the US growth rate in part by making more loans available for good projects in the US private sector. That will require a new bank fix.

I will write more about this in future posts. The way to end austerity and slow growth is to fix the banks sensibly and credibly. The authorities made two big mistakes between 2005 and today. All now agree they were too lax prior to 2007. It is now possible more will come to see they have been too tough and too unhelpful to rebuilding well financed expansion minded banks since the crash. People may not like banks, but trying to punish them as institutions is a kind of self harm, as it depresses economic performance if the banks cant lend.

I heard a passionate debate on Any Questions and Any Answers this week on the latest proposal from some private schools that they could provide free places to lower income pupils if the state paid them the average sum the state pays public sector schools for their places.

Those against argued that the fee paying schools do well out of their charitable status, and should not be given additional state cash. They saw the fee paying schools as seeking talent and money from the state sector to improve their own budgets and talent pools. They argued that everyone needing state support should use the comprehensive places that can be made available, though most fell short of demanding the closure of all fee charging schools for the rich.

Those who favoured the move thought it was a win win. Able pupils from low income backgrounds could receive excellent academic educations in the fee paying sector alongside children from rich parents. The school would subsidise the place, and the state would be spared any above average cost and additional capital cost of providing more places by putting pupils into private sector settings that already have their buildings and equipment. This could represent a decent saving in parts of the country needing to expand provision.

I myself won a scholarship providing a free place at a Direct Grant school. I also had the offer of a grammar school place, so either way would have received an academic education capable of helping me to university. It worked for me, and I saw no harm in it at the time. I would be interested in your thoughts on this suggestion from some fee charging schools.