John Redwood's Diary
Incisive and topical campaigns and commentary on today's issues and tomorrow's problems. Promoted by John Redwood 152 Grosvenor Road SW1V 3JL

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What is a fair and effective Act of Parliament?

The criminal law in our country has for long been a mixture of common law principles and decisions by judges, and Statute law where Parliament legislates to clarify and guide common law practice.

There have been various disagreements between the courts and Parliament over the law. In the end Parliament can legislate to change the law for the future despite a previous pattern of judgements or in place of established court principles.  In that sense Statute law is superior law.

In effect though courts still retain powers especially if   the law may be unclear as drafted by Parliament or it may be unenforceable. Whilst Statute law is usually supreme, both courts and Parliament have to recognise there are limits to their respective powers to move the law in the way they wish.

Today given the fluid and uncertain  constitutional background created by Remain campaigners and lawyers, we need to ask are there any limits on what laws Parliament can pass? Let us take three prospective cases of possible Acts of Parliament.

The first, “The Sunny Sundays Act” would widely be recognised as bad law. This Act states the government must ensure every Sunday is sunny so people can enjoy their day off. Any such idea would be void as it is unenforceable, as government does not have the power to ensure it happens.

The second, “The reduction of rough sleeping Act” is a bit more difficult. This Act says that the Prime Minister has to sleep rough once a week until Parliament thinks he or she has done enough to curb rough sleeping and passes a motion accordingly. Surely this too should be void, as it infringes the human rights of the Prime Minister and puts that office holder at security risks out on the streets.

The third is  “The breaking of the Prime   Minister’s promises Act” which requires the Prime Minister to reverse certain specified policies he had set out and campaigned for, because opposition forces in Parliament do not like them. The opposition with a small temporary majority got this through in order to undermine the Prime Minister’s popularity. Is this a fair  and enforceable Act? Isn’t our constitutional way of dealing  with a PM who no longer commands a majority to remove him by a vote of No Confidence?

These hypothetical proposals show the difficulties of having a minority government and taking away from it the sole right to initiate legislation. The country can become ungovernable with a headstrong Parliament that cannot supply a majority government yet refuses an election.

Deal or no deal?

The Withdrawal Agreement is unchanged, so I have no need to update my comments on it which set out the problems with it, especially concerning the powers of the ECJ and the money.

The Political Declaration is improved. It now makes it clearer that any joint military actions requires the consent of the UK government. More emphasis is given to basing a future trade relationship around a Free Trade Agreement.

The Declaration whilst confirming we become an independent coastal state for fishing purposes puts our fish back into play with the prospect of a new fishing quota and access based agreement with the EU.

It suggests the future agreement is based on an EU Association Agreement, designed to get countries to converge with the EU prior to joining. This is not a good model. The ECJ remains supreme over issues of EU law in any dispute.

The reworked Northern Ireland protocol raises the issue of how could Northern Ireland extricate from following EU rules and customs practices?

This is an important question, as this draft Withdrawal Treaty does not have an Article 50 allowing unilateral exit .

The Queen’s speech

We are getting through the traditional Queen’s speech debate this week. Normally it sets out what the government will do over the year ahead, specifying which pieces of legislation they will pass . The Speech also highlights any major events of the diplomatic year, telling us about State visits. It does not go into detail about budgets, departmental spending plans or the day to day business of government.

This Queen’s speech debate is like no other I have participated in for one very simple reason. The government advancing it has no majority. Every item in it needing Parliamentary approval will require some opposition MPs to vote for it.

In the debate yesterday I asked the representative of the SNP what they would support amongst the list of Bills in the Speech. None seemed to be the answer. Labour has been a bit more helpful, liking the Domestic Abuse Bill.

There is no point in this Parliament continuing unless sufficient Opposition MPs agree to vote for some of the bills in the Speech. Short of any opposition support the legislative programme is a fantasy list, a list of Bills a future Conservative government would like to put through given a majority to do so.

The present Parliament has substantial negative capability, but is unwilling to come together to achieve anything. That is why we need a General election.

Slowing economy

The latest job figures confirm that the UK economy is slowing as the rest of the world does. The combined impact of the UK’s home grown fiscal and monetary squeeze, and of the big fall in worldwide car output and manufacturing more generally is being seen. The poor background of trade wars and new tariffs does not help.

Over the last week the USA has threatened Turkey with higher tariffs in steel and suspension of trade talks. The US-China talks stumble on in the hope that they could at least delay or cancel the next round of US tariff rises mid month this month. The disputes in Kashmir, South Korea-Japan, and US- Iran also continue.

We are told the UK government plans a budget for early November, when they need to provide some stimulus . India, France, China and others have made recent cuts to taxation, which the UK also needs to do.

Deal or no deal?

As some of you only want to write about Brexit, here is your chance. I’m sticking with my view of the problems with the Withdrawal Agreement and the need to propose a Free Trade Agreement.

So what deal or agreement if any would you like the UK to propose during these secret talks?

What Agreement do you think the EU would accept, other than the already drafted Withdrawal Agreement?

The German plan for net zero carbon

A recent German study puts the cost of taking Germany to net zero carbon by 2050 at Euro 7.6 trillion. Much of this will fall on German consumers to pay. They will need to buy different cars, insulate their homes, change the heating systems in their homes, pay more for their travel and the rest.

Some of this cost will be displacement of investment renewal that takes place anyway. Cars, boilers, trucks, planes all have a finite life. The additional cost comes from replacements that are dearer than the originals, and above all from regulators requiring early retirement of the existing investment.

The business world will be at the forefront of this transition. The petrol companies have to move from a big chain of filling stations to a big chain of electric chargers. The airlines have to buy a new generation of jets that burn alternative fuels. The plastics industry has to close capacity whilst the paper and wood industry needs to expand for packaging and other items.

It would be good to see a proper costing for the UK, and more work on what this means by way of transformation of our shops, homes, industrial plants and transport systems. Clearly there need to be plenty of closures of hydrocarbon based ways of working, living and travelling. Car plants making petrol and diesel vehicles , oil and gas companies exploiting natural resources, manufacturers of traditional heating systems, fuel intensive production of many things will all need to adapt or be closed down.

What timetable do you think acceptable for this big change? Or do you think  this is a wrong course of action ? How much should an individual be expected to spend on home improvement and transport change?

A new programme for a new government.

Today is Queen’s speech day. It is the day to discuss where we want to take our country and what should be the priorities for public policy.

To those who want this site to write about Brexit every day I have just two things to say. The first is I do not change my views on the advantages of Brexit or on the need to get out on 31 October, so I do not need to keep reaffirming them.

I have set out my advice to the government on how best to do it on many occasions. The second is I see no point in  responding to every rumour, leak and piece of misinformation about the talks and the possible outcomes.  Meanwhile there are crucial issues that matter that we do as a country need to debate and tackle.

My main priority for the government is to confirm the action it will be taking to stimulate our economy and to distance ourselves from the German recession and the advanced slowdown on the continent. I want to see additional good measures to promote growth, following a couple of years of fiscal and monetary squeeze from the UK authorities.

I wish to see a defined programme of good investment, public and private, in transport, broadband, water and energy. We need more capacity in each of these areas. I want to hear of the tax cuts we can now afford so net take home pay is higher and businesses and entrepreneurs keep more of their profits to allow reinvestment.

I see from briefings that we can expect legislation and or administrative changes  to alter the way we own and run our railways. I will write more about this as we await conclusions from the latest review of our system.

The government does need to review its tax and regulatory policy towards cars given the worldwide impact EU and various countries’ policies are now having on motor manufacturing. It also needs to talk about the way the move of the EU to zero tariffs on Japanese cars over the next few years may impact the balance of Japanese manufacturing as between Japan and the EU as a whole.

I am glad the government has confirmed the higher sums for state schools for next year, which will be welcome in low funded areas like Wokingham and West Berkshire. The new money going into the NHS needs to be wisely spent, with Ministers telling us what improvements we will  be buying with the cash.

Farming for the future

One of the big wins from Brexit can be a new agrarian revolution in the UK. We should develop policies to rebuild our self sufficiency in temperate food, as we virtually enjoyed before joining the Common Agricultural Policy. We should also look at other ways of increasing the use we make of our farmland to increase farm incomes.

Cutting food miles should be part of the aim. Investing in better farming methods should be the means of achieving the improvements. UK farms could do with more capital and successful farmers need access to more land to farm.

The UK has not invested as much in market gardening to produce vegetables and salads in the way the Netherlands has done. Our climates are very similar, but the Netherlands have gone much further in putting in glass houses and other protective systems to extend growing seasons and raise crop output.

We need improved funding of tenant and farm owner capital from both the commercial sector and from government as part of its financial support. In many cases forward contracts from leading retailers will make it possible to finance this type of expansion.

In the dairy sector more joint working with the leading food manufacturers and retailers could create more milk demand for conversion to value added products like cheese and yoghurt.

Landowners and tenant farmers can also add other incomes from making land available for solar arrays, battery storage and other green energy activities. We also need to stimulate more tree planting. Our growing conditions are often better than Scandinavia and Canada yet we import most of our wood.

With a massive £20 bn food deficit with huge EU there is plenty of scope for new farming expansion here at home.

Deal/No deal – a false description

The choice before us is not leaving with or without a deal. The choice is simple. We either leave without signing the Withdrawal Agreement or we stay in for an indeterminate transition period with no agreement on what we are trying to transit to.

Were we to sign a version of the misnamed Withdrawal Agreement we stay in for 21 to 45 months more under full EU legal control and making large payments to them. This time is available to try and negotiate an exit. Who can doubt throughout such a time Remain would be urging more delay in exit? And why should the EU rush to offer us good terms for exit when they had secured everything they wanted in the deliciously misnamed Withdrawal Treaty? They would have the UK’s money and compliance without facing our voice, vote and veto as they develop their centralising plans further.

What Mrs May and her officials probably had in mind for the eventual Future Partnership Treaty was a beefed up EU Turkey or EU Ukraine Association Agreement, locking us in in Perpetuity to many of the features of the EU we wanted to leave. Mr Johnson has made clear he just wants a Free Trade Agreement, which is greatly preferable. In which case the best course is to short cut these things and find out now if the EU will sit down and negotiate one or not. Either way we can then leave on 31October.

The PM has done well to get the EU to talk. He must now ask for enough change to honour the referendum result.

The Fed joins in with more monetary loosening

As the world manufacturing downturn intensifies the Fed has joined the Bank of Japan and the European central Bank in trying to ease the situation. The Fed has decided to create money and expand its balance sheet to ease the obvious shortage of cash in the short term lending markets between banks. This is welcome and necessary.

All the main Central Banks of the world with the exception of the Bank of England are now taking belated action to ease, to try to turn round the manufacturing slowdown created by past policy tightness , by other tax and regulatory policies targeting vehicle manufacture in particular, and the impact of new and additional tariffs.  I must ask again why is the Bank of England standing out against this trend? Who doesn’t it share the analysis and conclusions of other Central Banks?

The Bank of Japan is creating as much money as it takes to buy in government bonds to keep interest rates at zero for 10 year money, and negative rates  for shorter terms. The ECB is keeping the official short rate at zero, with negative rates for many government bonds for longer terms. To do so it is now buying in Euro 20bn a month of bonds. The Fed is putting $75bn overnight into money markets to keep the repo or short interbank rate down in line with official rates. The official rate has been cut twice recently and is probably about to be cut again.

Central banks in India, Turkey, Brazil, Australia, New Zealand and elsewhere have been cutting official rates. All this is seeking to offset the negative impacts of higher taxes, tariffs and tighter lending conditions. So far the actions have not turned the corner for manufacturing, though they have prevented a even faster and deeper slump.

As highlighted here before, the UK not only refuses to join in  with a general  move to assist manufacturing, but the authorities are considering a further restriction on car loans which lies at the heart of part of the problem of insufficient demand for new vehicles.  The latest GDP figures which suggest there will be no recession in the second and third quarters of the year continue to show a very weak vehicle manufacturing sector for the reasons forecast here.

The Bank’s new £20 note shows  the  great Turner painting of the Temeraire on the back. It’s a curious choice for an institution so concerned about our relations with the EU.