The row over what kind of car led to the Luton car park fire reveals a deep divide over what cars people want to buy and which they think are good. I have  not posted items from people who claim the car was an EV or was a diesel as clearly this is an important contested fact. Some assumed it was an EV, some countered it was a diesel and some now say  it was a hybrid with a lithium ion battery. Let us have the truth from some independent authority.

The reason for the row is of course the fact that the establishment wants people to love electric cars, whilst many people do not want one for all sorts of reasons. They are looking for any more bad news to try to put the establishment off its huge support for EVs. If cars with lithium ion batteries do self immolate more often than petrol or diesel then that would be a big negative. Bringing down a whole new car park is not a good look. We must be thankful no one died in the fire. There are worries about newsworthy vehicle fires and about the difficulty in putting out a battery fire, and issues over how common these disasters are.

The underlying problem is the insistence of net zero governments that we should buy or accept products we do not want because we think they are dearer, less convenient, not so fit for purpose. Indeed in one case government wants us to accept a product, the smart meter, which is offered free. We all of course are paying heavily for this through our tax and energy bills. Despite the free offer, years on half of us refuse one. Huge money and effort is being expended on trying to get us to take one. They will not take No for an answer. They should  try instead to understand the wide disagreement with these products and produce better ones we do want.

Too many people see EVs as dear, with too limited a range posing big problems to recharge. The refusal of government to say how lost petrol tax will be replaced is also a major worry. Too many people think heat pumps are far too expensive even after a subsidy, and worry they would be dear to run and let us down on temperature on cold days. Smart meters are thought to be a change designed to overcharge or switch off power if supplies become too irregular.

The green revolution needs to take consumers with it to make faster progress. That will require improved products and services that people can afford.

Much has been written and spoken about Labour this week as they met for Conference. I will today give one of my rare critiques of the leading Opposition party’s policy approach.

It is difficult to square their analysis which wrongly claims public services  have been starved of money in recent years, with their proposal that there should be an iron discipline against more spending, taxing and borrowing save for a very few limited changes paid for by VAT on school fees, and an extra tax on Non Doms. They ignore the £350 bn increase in annual cash spending this Parliament so far, an increase well above inflation. They ignore the collapse of public sector productivity.

Were they to win office they would soon be subject to many spending pressures from the public sector Unions and some of their own MPs to tear up the iron rules and go for a higher taxing, higher spending, higher borrowing model. They have no ideas for getting productivity back to even 2019 levels. Their attack on waste centres on getting back more of the wrong claims on covid relief monies,  where the present government’s policy is to maximise the repayments. Labour would be using the same officials to pursue the same policy. Savings on private planes will be tiny in a £1.1 trillion budget and many Ministers will doubtless still be flying around the world in expensive seats on commercial flights.

Their views on migration favour making faster decisions on applications,. The danger is they will allow or encourage flagging many more people through. The safest and quickest thing to do for the official is to say Yes. This avoids criticism from the applicant and legal challenge and means they could rush the weighing of the evidence or skimp the need for proper documentation seeing the Ministerial imperative to get a fast time for processing. Putting on  more safe routes of entry and speeding consideration could be similar to offering an amnesty to all who are here in the queue, and is closer to having open borders. The wish to do a deal with the EU to try to get more co-operation from France would come at the cost of accepting more migrants from the EU. The EU  are keen to spread the large numbers coming across their southern and eastern frontiers through as many states as possible.

The policy of wanting to force through more planning permissions to build homes and new towns whatever the local view of the desirability and feasibility of this policy is at least consistent with a migration policy likely to boost numbers of newcomers. The housing shortage is partly the result of up to 600,000 additional people coming to the UK and needing homes in a single year, when the homes build rate has neve been anywhere big enough to cope with such arrival  numbers on top of domestic demand.  The planning policy is not a good idea. Communities have been asked to take a lot of  new homes in many parts of the country, and have seen homes built before the extra roads, hospitals, schools, utility provision has been completed. It is also very difficult to hit CO 2 targets for reduction if the country invites in many more people and  needs to build many more homes for them, as this is bound to increase the CO 2 output substantially.

 

Please find below the link to my participation in the Spectator’s ‘Has Brexit Failed?’ event at Conservative Party Conference last Monday

https://www.spectator.co.uk/podcast/has-brexit-failed/

 

 

Scottish devolution when voted on at the end of the last century was claimed to be the way to allow Scotland to perform better than England in public services and economic growth when they could run their own services and boost their tax revenues.

I have no intention of arguing we should seek to reverse a democratic decision taken in a referendum, and many Scots may well have voted for more Scottish decision taking however it worked out. It  nonetheless sheds an interesting light on policies towards higher spending and higher taxes to see what Scotland has bought by choosing both. It is a perfect experiment compared to England over the last 23 years.

Scotland has imposed a higher 21% intermediate Income tax rate, a higher higher rate at 42% and a higher Top rate at 47% compared to the rest of the UK at 20%, 40% and 45%. This has helped Scotland to afford much higher public spending per head, though the bulk is paid for by a bigger grant from UK taxes. Scotland last year spent £13,881 per head on public services  compared to £11, 549 in England.

If we take the two key services of health and education we see little advantage from these higher sums. Scottish pupils on average are well behind English ones in maths and science judged by international secondary school comparative  assessment, and similar in English. The NHS in Scotland has more long waits to get NHS treatments than England and has a bigger percentage on waiting lists.

Meanwhile there has been no boost to growth from higher spending and taxes. Since 2000, the first full year of the Scottish Parliament, Scottish GDP has advanced 86.6% in cash terms compared to 106.2% for the UK as a whole.

Scottish voters need to ask some tough questions of their government. Why aren’t public services better for all the extra money? Why is economic growth lagging so badly? It also warns England that a further hike in taxes and public spending would not deliver better results on this evidence.

So Labour wish to run large scale investment projects better than HS 2. They wish to halve the government’s use of consultancies, reduce the use of chartered planes for government Ministers and ensure more private investment is added to state investment to boost output.

This is not going to suddenly change the growth prospects, get inflation down faster or transform public sector management. Consultancies may be due a hair cut, but you cannot say how many you need until you identify what they do and whether  they are essential because  the civil  service does not have the skills and knowledge. Otherwise they should only be used where  they are cheaper and better than in house.

Cutting down on plane use may afford some small savings though rail tickets are also dear these days and chauffeured cars do not come cheap.  Most of us would like to see more private investment alongside or replacing public investment. The question is does the state identify enough projects that will earn a decent return to attract the investment? Labour’s wish to impose more windfall taxes will put off some private and foreign investors, reminding them that if their investment works the government will want to pocket more of the profits.

Labour promises us iron clad  fiscal rules. They want to double up on Treasury forecasts and an independent Office of Budget Responsibility . They will make every decision on tax and spend dependent on a report and forecast by the OBR. They should have learned that that very system allowed a huge increase in spending and borrowing over covid when they backed government spending plans and urged more. It then led to big rises in tax revenues  which they attack.  Chancellors have to make judgements as they will be blamed for the results. The OBR needs to amend its models so it can forecast the levels of tax revenue and borrowing more accurately than it has been able to do in recent years. We need an accurate guide to help steer the ship. How would they restore lost productivity with public sector Unions keen to expand workforces?

The Taxpayers Alliance published a study showing that civil service numbers rose by 101,440 between 2016 and 2023. This was an increase of 24% and a bigger increase in numbers than the total strength of the British army. There has been a particular growth in top grades and the higher salary policy oriented posts, with 2,050 paid six figures and 195 paid more than £150,000.

In 2021-2 44,220 people left the civil service, or 8.6% of the headcount. 69,400 new people were recruited. This demonstrates that a decision to freeze recruitment can make a substantial difference quite quickly to overall numbers and to payroll costs. Ministers running such a scheme should be looking for considerably more than the 0.5% productivity gain suggested in the Chancellor’s speech,. given the large 7.5% fall in productivity since 2019.

Of course senior departmental managers should put cases to Ministers to allow external recruitment where a job is crucial and the skills are lacking in the current workforce on the departure of a key member of staff. In most cases there will be plenty of talent in the civil service to find an internal promotion. In many cases the departure of a staff member to retire or go elsewhere will trigger a review of whether that role can be abolished, amalgamated with another or allow the removal of some other role when the person is pro0motoed or moved into the key role.

The Chancellor has proposed £1bn of savings . As the typical cost of employing a person is around £50,000 taking benefits and direct costs on top of salary that equates to around 20,000 fewer posts through natural wastage. This is half the level that could be accomplished in the first year of the programme.

The Chancellor in his speech to conference last week stated that he is  now onto the productivity problem in the public sector I have been highlighting:

He said

“We need a more productive state not a bigger state.

If we increase public sector productivity growth by just half a percent, we can stabilise public spending as a proportion of GDP. Increase it by more and we can bring the tax burden down.

Half a percent.

For those of us with private sector backgrounds that doesn’t seem too much, does it? In the public sector, I’m telling you, it’s harder – but we are up for the challenge.

So I’ve commissioned my deputy, John Glen, to restart the process of public service reform.

He wants to know why teachers say more than half of their time is not actually teaching.

…why police officers complain they spend longer filling out forms than catching criminals.

…and why doctors and nurses say they spend up to half their time not with patients but on admin.

Of course we need modern working practices and better IT. But the Treasury too needs to change its focus from short term cost control to long term cost reduction.

And we’re going to start with the Civil Service.

We have the best civil servants in the world – and they saved many lives in the pandemic by working night and day.

But even after that pandemic is over, we still have 66,000 more civil servants than before.

New policies should not always mean new people.

So today I’m freezing the expansion of the civil service and putting in place a plan to reduce its numbers to pre-pandemic levels.

This will save £1 billion next year.

And I won’t lift the freeze until we have a proper plan not just for the civil service but for all public sector productivity improvements.

That means, amongst other things, changing our approach to equality and diversity initiatives. Smashing glass ceilings is everyone’s job – not a box to be ticked by hiring a diversity manager.

But I’m going to surprise you with one equality and diversity initiative of my own, trust me you’ll like this one: nobody should have their bank account closed because someone else decides they’re not politically correct. We’ll tighten the law to stop people being debanked for the wrong political views.”

Comment:

The government should aim to recoup the lost 7.5% of productivity since 2020 as quickly as possible. Freezing civil service posts will both  help raise productivity as natural wastage brings numbers down, and will act as a stimulus to the senior managers of public services to hasten the restoration of the levels of productiv9ity hit in the last decade and lost so far this. There is a £30 bn saving to be won from just doing things as well as the government did in 2019.

Readers know that I spend a lot of time urging changes and improvements to government policies in some areas. Often people write in  to say they agree and to complain that government does not. Conference this year shows that there are changes for the better that  offer a clear difference and superior choice than the Labour/Lib Dem policy.

Take the speech of the new Energy Security Secretary. She stated that she intends to source more energy domestically instead of relying on more and more imports as the net zero policy enthusiasts have wanted. She proposes more energy that is “home grown, clean and cheap”, essentials for stronger industry and rising prosperity.

She sees energy independence as ” our best defence”. She says she will back our own North Sea  “instead of relying on oil imports , as Keir Starmer would have it”. As proof of that she has already given the go ahead for the new Rosebank Field, an important future source of oil and gas, well paid jobs and plenty of UK tax revenue.

She promises us “the first large scale nuclear project since Margaret Thatcher’s government”.  She has moved the competition on to find the right company to develop and roll out many small nuclear modular reactors. Done well this could be a big boost for UK manufacturing, with plenty of scope to export as well as to install a number of these probably at existing nuclear sites where there is already a trained workforce facing the closure of an old nuclear  generator.

She reflected the change of direction over the road to net zero announced by the Prime Minister. “If we are to succeed, net zero cannot be something that is done to people, by a privileged elite” “We cannot force people to make wrong decisions for their families. And it is immoral to put forward policies that will impoverish people here, when emissions are rising abroad.”

She argued that as the UK produces 1% of world CO 2 emissions and China 30% more of the burden of adjustment must now be undertaken by the large emitters. She attacked the left who have made “Net Zero a new religion, showing condescension to people’s way of life “. She does not want to lecture people about eating meat, taking a foreign holiday or driving to work.

She recognises government can only get change if it takes people with them, and if the new products and services are affordable and popular.

All this makes much more sense than the command and control system based on bans, higher taxes and legal requirements.

After ignoring me for many months yesterday the BBC  sprung into life and wanted my  views on the proposed change of law over the sale of tobacco. Why? I  have never written or spoken about this matter. I have not been lobbying on it, and there was nothing on my website or tweets that morning to arouse interest before they rang.

They seemed ill informed about the proposal as they asked about a proposal to ban tobacco. I explained the proposal was to increase limits on the sale of tobacco by stopping anyone under 14 from ever buying it during their lives, on top of the current ban on sales to anyone under 18. It only becomes a ban on sales for all after around 90 years have passed. It is not a proposal to criminalise smoking.  I said I wanted to hear how it would be enforced as retailers would need to be able to judge ages as the age of permitted purchasing went up, and would want to know what the penalties were going to be.  They then gave up  pursuing it. I reminded them that I set out daily views, and offer stories like the big losses on bonds by the Bank, the problems with carbon accounting and with some self defeating so called green products and services , and   the productivity collapse in public services which they ignore.

I was also telephoned and offered a BBC  interview last Sunday. I asked what it would be about and this was unclear. I said I could do an interview from home on line on the Sunday or at the conference on Monday, as they sounded keen to interview in Manchester. They said they would get back to me, but never did.  Why?

BBC Radio Berkshire did want an interview on rents, housing and the PM’s speech, which I did undertake yesterday morning with ten minutes  notice.