Some MPs in the UK have rushed in to side with the Australian government and Parliament in their row with Facebook. The Australian government is proposing a law to make platforms like Facebook pay to use extracts from newspapers and media reports on their sites, so the journalism involved will not go unrewarded. Facebook has countered by  saying they in effect give the papers and media free adverts by posting some of their material with full credits.  The journalists get access to a much bigger audience which in turn boosts their commercial value. Facebook decided that the best way to comply with the prospective law is to ban all journalism extracts from established media outlets from its sites so it need not make any payments. This tiff provides a good opportunity to review the current state of journalism and how we pay for things here in the UK. I do  not propose to weigh into the Australian debate, which their Parliament is best able to conduct for itself.

Let me declare my prejudices. I am a fan of good journalism. A well researched and informative article helps my education. Lively and informed opinion pieces contribute to the national conversation, vital in a democracy. Well written and amusing pieces are entertaining, a welcome diversion for time off.  Many  pay for some of this by buying  papers and electronic subscriptions, by paying the BBC Licence fee, by their employer taking out collective subscriptions for services needed for work, and by accepting adverts alongside journalism to enable them to enjoy some free services. Each of these paying  models has its advantages and disadvantages.

My concern with the current UK media relates to editorial choices and use of journalistic talent. I am particularly critical of the BBC because I have to pay for it whether I want to use it or not. It regularly fails to live up to the ideals of its Charter. As one who used to listen to a lot of Radio 4 news and watch one of the main evening tv  news programmes every night, I often find myself turning off, faced with the same diet of highly selective topics and systematic bias of worldview. For much of the last year the two story lines of pandemic and global warming have dominated most news  broadcasts. It is often not a case of “news”,  but recycling “olds”. It is often not hard news but regurgitated opinion or forecasts, not reported events and government statements but opinion surveys and lobby group reports inspired to prove a viewpoint. In order to be better informed I turn direct to the sources of the news and read the statements, draft laws, budgets and the rest for myself, as it is a rare day that you get much factual content or informed comment on the important decisions and events that unfold.

Armed with the facts and statements of those making the news I often find I am in a very different conversation from the trivia, ideological repetitions  or exaggerations of the main broadcasts. The BBC makes use of highly selected experts, many of whom seem to share a clear one sided political viewpoint about the importance of powerful global government as the answer to their view of what the problems are. Some of them do  not seem to have read the detailed documents that underpin the issue. On economic matters I find they usually misrepresent the position  by drawing on some highly spun interpretations and not using the actual figures. They normally ignore important statistical releases, as with the state debt where they do not usually distinguish between net and gross allowing for Bank of England ownership of debts. They rarely report cash figures for public spending and spending increases .  They are not interested in public sector productivity issues. They accepted the Labour “austerity” analysis of the previous decade without revealing that over that decade there was a very large rise in tax revenue, a rise in cash public spending  and even a very small increase in real public spending, contrary to the generally stated cuts in spending and a failure to increase taxes enough. They  regularly ignore the preoccupations of voters with issues like illegal migration, politically correct language, restrictions on freedoms , controls on our freedoms and high taxes on enterprise.They usually dislike or ignore England.

I am glad to see Lord Frost has been brought in to sort out the remaining difficulties over fish, and the  trade issues between GB and Northern Ireland. I hope he will also be a strong voice to deliver the wins from Brexit we have often discussed on this site. Next week’s budget offers another opportunity to lower or remove EU taxes imposed under their VAT rules and to amend their court judgements on business taxes. There is also plenty of leeway to use our new grant and loan regimes at the Environment and Agriculture Department to grow more food at home and serve our local markets better. Our renewed status as an independent coastal state should be used to regulate our fishery properly, with protections against ultra large trawlers and damage to marine environments by foreign vessels

Lord Frost needs to make sure the UK is full control of our own single market so that there is free trade between GB and Northern Ireland as before, with the agreed  protections for the EU’s single market in the case of the minority of goods that go on from Northern Ireland to the Republic. All loads going from GB to NI for final delivery in NI can be certified as such by trusted traders and allowed  to pass as before.

There is plenty of opportunity to make and grow more of what we need as we use the freedoms of Brexit. We also need a good statement next week with a timetable to end lockdown. The way to get the deficit down is to promote vigorous recovery by every means at our disposal.
Lord Frost needs to show more determination to stand up for the UK and to use our independence. Life should no longer be a series of compromises or negotiations with the EU about how to run our own country.

The Bank of England Chief Economist has chosen a metaphor to reassure us about the economic future. I never mind a bit of optimism but I trust it will  not  deter policy makers from offering more assistance to the economy. He argues that because many people who have kept their jobs and decent earnings have been saving over the last year they will soon rush out and spend their savings once lockdowns are eased. The economy is  a coiled spring, about to spring into life as soon as the controls are eased. I daresay there is some pent up demand for leisure and hospitality when the all clear is sounded.

The figures do indeed show that overall savings are up, but that conceals big differences in  experiences of people,  There are people like the Bank’s senior employees on good salaries that have continued to be paid in full  during lockdown who have  saved. They have been unable to spend money on foreign holidays, trips to cultural and sporting events and good meals out in restaurants in the way they used to. They have probably  allowed some cash to build in their accounts. There are also people who have lost their job and seen their income fall as they go onto benefit. There are people who are furloughed or working only some of the time given the lockdown restrictions whose income has been impaired. Many in hospitality and entertainment and many self employed and small  businesses have suffered financially. It is most important they are offered continuing assistance until lockdowns have ended and they are able to earn their  full living again. Families have had to spend more on utilities, food and other essentials at home as they and their families work and learn at home which means many have not been able to save.

I expect when they are able to people on decent incomes who have saved a bit will want to book a meal out or s staycation at a hotel. They will want to book events again as soon as that is allowed. The problem for the hospitality and leisure industries is they will not get back the lost cash from cancelled business over the last year. When you return to a favoured local cafe you do  not buy two lunches for yourself, you just  buy the one now, not the one that was cancelled  by  lockdown. If you decide this year you can celebrate your birthday at a local restaurant, you do not pay for the celebration last year they had to cancel. Some hotels and entertainment venues  have been holding cash from customers who missed out on their previous bookings. They will have to supply service with  no new cash from such customers. There could be a bonus for the UK if overseas travel is still restricted or problematic in that more people may take a holiday in the UK, though there will be in all probability be a  continuing loss of foreign visitors.

So I agree there will be a recovery, and there are opportunities out there were resilient businesses. I think the authorities should also remember this has been a tough time for many self employed and small business people. it does not all snap back quickly when controls are eased. I want to see a budget for recovery, jobs and the self employed. We need their flexibility, and some of them have not been treated well over the lockdowns.

I am writing again to the new Secretary of State at the Business Department about our energy situation. I am asking him to reassert the priority of ensuring sufficient supply in the UK for our needs. We have become too reliant on imported electricity from the continent. They are embarking on closures of many nuclear stations and coal stations, are becoming more and more dependent on Russian gas, and may in the future have less surplus to send us. We can neither rely on their power being  green enough nor always available for our needs. I also wish him to reconsider the issue of affordability. To tackle fuel poverty cheaper power is a big help. To attract and retain industry at home, a plentiful supply of good value electricity is essential. The importance of reliable supplies has just been underlined by the substantial outages in Texas at a time of very cold and snow filled weather.

It is important not to have the wrong policy for the sake of a mistaken way of calculating the carbon results of our actions. If we only count the carbon dioxide emitted by industry in the UK, and not the carbon from all the factories abroad making products to sell us, we will develop a policy which positively encourages the deindustrialisation of the UK. Many goods made in China are made using substantial quantities of gas and coal for direct fuel and to generate the electrical power also needed by the factories. It is false accounting to ignore all that but to penalise UK producers for using fossil fuels.

The UK may well be able to generate much more power from renewables. The government should be keen to encourage more capacity to be installed by organising the relevant auctions and putting in place the necessary policies. As it has big ambitions for electric cars and heating it needs to plan for a huge expansion of generation, as well as for the replacement of the ageing fleet of nuclear stations that are about to be retired. More biomass based on UK wood would be an option, as it generates reliable power. More water power from new  barrages and from tidal interventions would be predictable. With the right auctions and rules it would be possible to strengthen our capacity and provide some competitive pressures on prices.

The decision of most governments and the world Climate Change conferences to go for electric cars unleashes a juggernaut of change on a shaken motor industry. Sales of new diesels and even of petrol engined vehicles have plunged. Potential customers have often decided to hold on to the vehicles they already have, to see what is going to happen to car fuel taxation, to subsidies for new electric vehicles, and to taxes and regulations on the use of diesels and petrol cars before committing to a new product. The wary who might like a new diesel or petrol  vehicle worry lest in a few years time they are blocked from going where they wish, given the way German cities for example are already blocking older vehicles from entry. What will happen to second hand values when we reach the point of a ban on the sale of all new diesel and petrol cars? Some fear a fall, others think they might paradoxically go up as people chose to buy a second hand one in the absence of a new one.

It is true that lockdown last year hit output and sales badly, but it would be wrong to think all the fall in  diesel sales was temporary. There was a  trend developing against new diesels before the pandemic hit, which will continue given policy as lockdown ends. The car industry has accepted, even welcomed the transition to electric.  It will be costly, disruptive and difficult for those involved. The industry has preferred to talk about other far lesser issues or more temporary concerns and ignore the structural imperatives that should preoccupy it.

The UK government needs to be engaged and concerned about the UK car industry. The UK with some government encouragement and help built itself a great position in diesel engine technology and output. Ford changed Dagenham from car assembly to an engine production plant. BMW put in a great automated engine plant at Hams Hall Birmingham. Jaguar Land Rover spent a lot of money with government help on a brand new engine facility at Wolverhampton. Toyota put in an important engine factory on Deeside.  The UK helped design and perfect the new clean diesels with practically no particulate material coming out of the exhaust. All these plants make engines which the government wishes to retire by 2030 at the latest, with encouragement to people not to buy such engines from well before that date.  These factories cannot make the big batteries that form the core of the electric vehicle power unit, nor can they turn out the electric motors without stripping out all existing equipment and starting again.

If the UK is to keep motor manufacturing at home it needs to support and encourage large scale battery production and new factories for new electric models. The problem both the government and the industry have is they need to put in all this electric capacity before there are enough customers to buy the vehicles. Jaguar Land Rover shows the problem. Their buyers still want to buy the petrol and diesel product. As they transition to an all electric line up they have decided to go  more up market, losing the better off and concentrating on the rich who can afford to pay many tens of thousands for a single car . This will probably mean much less volume. If they end up closing or greatly shrinking  the Wolverhampton engine works and Castle Bromwich assembly works, favouring more overseas production, they will also lose more traditional UK buyers of their product who like the Britishness of the brand.

Eskenzi PR and Marketing put out a press release yesterday reporting a sampled survey of 1000 people. They said that one third of those asked had stopped buying EU goods. Reasons given included extra costs and delays in  getting the goods into the UK and an unwillingness to buy EU goods given the attitude of the EU to trade with us in recent months.

I would be interested to know whether your experiences bears out this survey. Does it worry you? Do you yourself seek substitutes for EU products?

It is curious if true that the EU is trying to impede exports to us as well as seeking to make our exports to them difficult. The UK has made clear it was not going to impose new barriers at our ports to get in  the way of the substantial volume of imports from the EU that we have accepted, and is working with a grace period at our borders. Despite this there are reports of surcharges on card transactions and postal delays. It is also true that some continental websites have failed to collect UK VAT as required leading to an extra bill for the UK consumer who expected VAT to be included in the pricing,

I myself have long followed a policy of buying UK food items wherever possible, to cut the food miles and to back UK fishing and farming. My second choice is to import from a developing country who are in more need of the trade and who have warmer  climates offering products we cannot grow here.

I have explained before that the U.K. calculates real GDP differently from many other countries. It adjusts the cost of public services like health and education for real output where others just rely on money spent. The U.K. reported correctly a sharp fall in output in education when all the schools were closed and a substantial fall in health output when elective and non urgent activity was cancelled to leave more capacity for CV19 cases. Both services recorded sharp falls in productivity as a result.

If we look at nominal GDP figures based on spending the U.K. economy had a relatively small fall of just 2.2%. This was less than Germany, France, Spain and Italy though a bit more than the USA at minus 1.2%.

The big debate now is how do we get back the  lost real output and  reverse the decline in Nominal GDP. Some are briefing that the U.K. needs to return to austerity with tax rises to cut the state deficit. This would be a bad idea, leading to a larger state deficit than a policy centred on going for growth and recovery. As the figures reveal there has been a big transfer of spending from private to public sector as the state has tried to make up for the inability of millions  of people and hundreds of thousands of businesses to earn their own living thanks to the closures and social distancing imposed  to combat the virus. The way to boost real GDP and to cut the deficit is to allow many more people and firms to supply goods and services, boosting output  and tax revenue at the same time.

What we need is to expand output capacity. That needs keeping and reviving as many of the businesses as possible that we had before lock down. It also requires a positive environment for the  self employed and small business to invest cash and effort to  meet more of the new demands of the post CV19 world. The state needs to rebuild its service output in health and education as quickly as possible which will make our real numbers look more like others. This is a time when lower tax rates will boost output and investment and cut the deficit by more than attempting to lower it with tax rises.

The worry is too much capacity amongst the self employed and small businesses will be lost as they grapple with up to a year of lost turnover and revenue and as they work out how to pay back the loans they have taken on. There remains a number of issues for government and Parliament to help work out over liability for past rents, Business rates, and the other costs of keeping a business which cannot trade. In future posts I will look at more of the opportunities for the UK to expand its capacity as we emerge from lockdown.

It was good to hear the Secretary of  State for Health on Friday say a bit more about treatments, and express some optimism that this year should see approval for treatments for CV 19 which make it much less likely someone will die or have a bad version of the disease. The UK is currently conducting 96 trials of drugs and 9 trials of other vaccines. Worldwide there are reported trials of 700 drugs that may help with treating CV 19, with a total of 2607 clinical trials running for the drugs and vaccines. The USA alone is currently organising 555 clinical trials for CV 19 treatments and vaccines.

I have been long advocating the UK puts resource into these important efforts.  Without medical training, I do not know which if any of these possible treatments can do good. It must be  worth trialling them to find out.

So far the UK has approved dexamethasone, remdesivir and tocilizumab as options for doctors to prescribe where they think they are appropriate. There are a number of other treatments used elsewhere, and we await progress with further trials here for those. There have been strong arguments over Vitamin D, hydroxychloroquine and ivermectin in particular, with disagreements about the conditions for some past trials and strong views of whether these might be effective or  not. All  possible medical options should be fairly and promptly assessed. I hope the government’s new enthusiasm to share some more information and to express some optimism is a good sign that the medics do now feel treatments from adapted existing drugs and from new drugs can make an important contribution to lessening the suffering from this disease. I will follow up with some more questions to the government.

The poor UK GDP figures for 2020 are  not comparable with many other countries. As I explained on 12 August on this site, the UK statisticians reported a large fall in health output with the big drop off in non CV 19 work, and a big fall in education output with the closure of schools from the second quarter of the year. Other countries with large state sectors in education and health report the cost rather than the output, so they do not show any decline in these large areas of activity.

I agree with the UK statisticians that GDP should be based on output. It is a pity other countries do not use the same basis. If we included all the UK spending instead of output in the state sector then the UK had a relatively good GDP performance last year compared to other European countries.

This week the government published “Working together to improve health and social care”, a White Paper sketching proposals for reorganisation of the NHS and the wider care sector.

It set out three aims.

1, Better health and wellbeing for all

2. Better quality health service for all individuals

3. A sustainable use of NHS resources.

I have  no problems with these very general aims. 2 and 3 should be the main drivers of NHS care, whilst 1 of course will entail individuals and the private sector to continue to apply  our energies to the task which is so wide ranging.

The main reorganisation entails creating two new bodies in each local government area. The first will be an Integrated Care System  ( ICS )  NHS body to control, procure  and direct local NHS services and to supervise capital budgets of the local NHS Trusts. The second will be an Integrated Care System Partnership to work with local government and presumably with private sector care providers to ensure good services and relevant procurement.

The White Paper envisages removing some of the competition provisions in current health regulations, to take away powers to control trust mergers, and to limit competitive tendering. They wish to go over to a more collaborative model. NHS England will be merged with Monitor and the NHS Trust Development Authority. The Clinical Commissioning groups are absorbed by the new ICS bodies.

I need to know more about how joint working will take place between Councils and the NHS under these arrangements. I also want more detail over what additional powers the NHS will have over private sector care providers, and how if at all the relationship between  care homes and the NHS will alter.

As I consider my response more fully I would  be interested in any comments.