Tomorrow at conference I will be part of a panel discussing how public spending could make a bigger contribution to cutting the deficit. I will have very limited time to tackle such a big and important topic. Let me sketch a bit of the background in this post, in advance.

The first thing I have urged the government to do for the last two and half years is to avoid large external commitments at a time when we are fully stretched at home. For that reason I voted against the £20 billion of extra money being made available to the IMF, primarily because I fear that money will go to the unworthy cause of trying to avoid changing the Euro scheme to let it work for those countries who can live with it. I voted against the £3.2 billion special loan to Ireland and against the UK £8bn contribution to the European Financial Stability Mechanism for the same reasons.

The second thing I have done is urged the government to transform RBS. RBS is too large for the UK state to back comfortably. It has been loss making and failing to deliver enough support for the UK economy. I have tried to get the government to speed its break up, sale of assets, reduction of taxpayer risk, and creation of new working banks out of its assets and liabilities. Getting the taxpayer out of majority ownership of a £1.5 trillion bank would be the single most important step it could take to cut potential risks and losses for taxpayers, and to improve the UK state balance sheet rapidly.

The third thing I have done is to set out case after case where the Uk government could spend less without damaging services or entitlements. There is the issue of the large derivative losses at Network Rail; the £800 million research programme of DFID; the £500 m overseas aid to nuclear weapons powers; the £1.3 bn of aid channeled through the EU that is not universally well spent; the large operating losses and inefficiencies of state owned Network Rail; the high level of subsidies to inefficient and expensive ways of generating energy; the persistence of high overheads at departments like DFID and the Energy department and many others;the high costs of legal aid owing to long winded and repetitious court processes for terrorist extradition, for example.

The fourth thing I have argued is that we spend far too much on UK membership of the EU. I have been pressing the governemnt to use its veto over the forthcoming 2014-2020 financial settlement. I have supported colleagues seeking a major cut in expensive and badly targetted EU regional assistance; pressed for a big reform of the CAP to cut its costs to taxpayers and food buyers alike; sought a general reduction in what the EU does in the UK and how much it spends.

The fifth thing I have highlighted is “soft touch UK”. With others I have asked the government to charge overseas users of the NHS for their treatment. I have proposed charges on foreign haulage firms using our roads. I have supported moves to curtail illegal immigration, and to tighten eligibility rules for benefits so they go to legally settled people.

PS I Am pleased to hear the Prime Minister is willing to veto an unacceptable EU budget settlement for 2014-2020, but disappointed that the government finds a “real terms freeze”acceptable when we need deep cuts to the EU outgoings.

I will be speaking at meetings at the Conservative conference on economic growth, grammar schools, the EU and public spending. They are all on Monday 8 October, which is Economy day at conference. The details for those interested are:

10.30 am “Local Growth” Hall 8B at the ICC (inside security) organised by Westminster City Council

12.00 noon “Are grammar schools a key to restarting socila mobility?” Conservative Home Marquee (inside security)

14.00 “Leaving the EU?” Bruges Group Main lecture theatre of Birmingham and Midland Institute Margaret Street (outside security)

16.30 “Cutting the deficit” Conservative Policy Forum Hall 1 ICC (inside security, party members only)

Just when it is very important Ministers look in control of government, a Senior Minister calls for the arbortion age to be lowered from 24 weeks to 12 weeks. This is followed by two other Cabinet Ministers saying they personally want it lowered to 20 weeks. Meanwhile Downing Street puts out that it will stay at 24 weeks. The Coalition government has no intention of changing the age limit, we are told. I doubt there is a majority in the current Parliament to reduce the limit to 20 weeks, and I am sure there is no chance of Parliament lowering it to 12 weeks.

I do not understand why we needed an argument about abortion if there is no plan to make any changes. I do understand that in a Coalition there will be occasions and issues when Lib Dem Ministers on the one hand, and Conservative Ministers on the other, wish to say their parties have different views and different approaches to big issues. That reminds us all when that happens that the resulting policy is a compromise, and heartens the supporters of the respective parties that their leading lights are thinking of what they wish to do should they win the next election with a single party majority.

I would be happy, for example, for Conservative Ministers to explain how they would change our relationship with the EU given a majority, whilst Lib Dem Ministers explained how they like the current relationship. That would be sensible political differentiation. That is what party conferences are for. I do not understand how a statement now of the disagreements between Conservative Ministers over abortion is productive.

Yesterday we looked at what Ministers can and should do. In my sketch I left out the crucial issue of who runs the department?

In theory the Permanent Secretary runs the department, and the Secretary of State runs the department’s relations with the outside world. They come together to agree policy.

Any Minister who trusts this split between policy and implementation is unwise. In practice a good Ministerial team work closely with their officials in the development of policy, and with them on its implementation.

Ministers do need to carry their officials with them when setting out policy. Good officials respect the right of an elected government to implement new policies which they have sold to the electors or which they believe will improve the lives of people. Good Ministers respect good officials, and value their criticisms, comments and suggested improvements to policy. A good Minister also knows when to say he has heard enough, and takes a decision.

Similarly officials need to recognise that in the case of the major policies and functions Ministers have every right to be involved in how a policy is implemented. A good Minister understands that forming and announcing a policy is just the start, not the end of his task.Ministers can apply commonsense and their knowledge of a very wide range of different people in their constituency to help the civil service design ways of delivering the service that work well for the beneficiaries.

Ministers also need to be very concerned about value for money. They should be the taxpayer’s voice in all discussions. Whitehall has an understandable wish to pad the accounts and to ensure enough resource is committed to each initiative. The Minister should be the one who queries the budgets and seeks to ensure the department is always striving to deliver more for less.

A good Minister needs a formidable range of skills. They need to be able to analyse and criticise proposals rapdily and well, to lead a team of officials to get a task done accurately and promptly, to keep morale up in their department whilst ensuring sensible pressure for better quality and better value for money. A Minister needs to be able to see ahead, to help the department avoid future problems, to challenge the way things are being done and introduce new ways of working or new policies that can work better.

It is not easy splitting implementation from policy. Ministers need to sit down and help hammer out how something will be done. They do need to take an interest in the detail as well as in the high levvel press release and soundbite.

Constitutional theory has changed a lot about the role and responsibilities of Ministers in recent years. The old idea that the Secretary of State was responsible for every decision of his or her department, whoever had taken it, has long been modified. No-one today thinks the DWP Secretary is personally responsible for a staff member miscalculating a person’s entitlement to benefit, or the Health Secretary is personally responsible for a cancelled appointment by a doctor. The doctrine of implied proportionality has emerged, where the decision has to be large enough to warrant personal intervention by the politician prior to it being taken.

All three parties in power have also developed the doctrine of the accountable quango. Secretaries of State do not accept responsibility for the decisions of the Bank of England or the Environment Agency. These bodies are appointed by Parliament, have budgets and founding Statutes from Parliament, and do things which the government used to do for itself before they were established or had their functions widened, but they are largely independent.

All three parties also accept the Michael Howard amendment to the doctrine of Ministerial accountability. Ministers can now delegate management functions to senior officials, and make them responsible for managing to an agreed policy. If they make a mistake in carrying out the required policy, the fault is their’s and not the Minister’s.

I have sympathy with these evolutionary changes. I do not think, however, they should become a reason to excuse Ministers from responsibility for the things that matter. Whatever the politicians may wish the doctrine to be, the voters regard the government as to blame for the big things that happen in government in its widest sense. It is time to ask what is a Minister’s job? What should we expect of them? Do we perhaps expect too much, when they in turn are very constrained by international law, domestic law, and the complexity and range of tasks of modern government? Or should Ministers take more of a grip over the army of quangos, the EU and international bodies that affect them?

A Ministerial job is a part time job. Ministers are also MPs, and have to do their main day job as well as being Ministers. They are more than Non executive Chairmen, but less than full time Chief Executive Officers in their departments. Unlike the Chairman, they do have to take or approve the CEO type decisions. Unlike the CEO, they are not full time. They do not appoint, promote and reward the staff they rely on. They may well be appointed with little knowledge or technical background in the area of their command. Their tenure may be short. This limits their ability to challenge or to decide on many technical matters.

The Minister is clearly responsible for setting the main policies of the department, on advice from officials and the wider public the department serves. The Minister is solely responsible for repesenting the department in the Commons and satisfying the Commons concerning its budgets and actions. Senior officials can be asked to appear before Committees. The Minister is primarily responsible for representing the department to the wider world through the media, conferences and the like. Senior officials play a supporting role. The Minister is the complaints department, the person who asks the difficult questions if things are going wrong. He will chair the relevant meetings to put mistakes right or change systems to prevent future error.

The Secretary of State is as far as the public is concerned responsible for all the main decisions the department takes. He or she can demand papers and people to cross examine. He or she can speed decisions up or slow them down. They can overturn official advice or ask for a second opinion. Ministers need to show they are prepared to do this when it matters.

Sometimes Ministers are appointed to jobs they know well. Occasionally a Minister is appointed with relevant knowledge and qualifications. That enables the Minister to do more and to make a better contribution to the work of the department.

As we have often said on this site, Ministers collectively need to wrestle power back from the EU, the ECHR and from some quangos. The public wants Ministers who do respond to public concerns and needs, and who have the power to do so effectively. We also need to consider what qualifications and training would Ministers ideally have?

It’s as bad as the old days of full nationalisation. The railways run at a huge loss. They fail to serve the commuters well, the main body of high fare paying passengers. They sell large numbers of very cheap off peak tickets to try to fill the unpopular inter city services at off peak times. Now we see it will cost taxpayers at least an extra £40 million to compensate private sector companies who took part in a competition to run trains that was badly managed by the Transport Department. In many ways Whitehall has more control over the partially nationalised railways than it had when they were fully nationalised. People forget that all the tracks and signals are nationalised, and the other companies using them are highly regulated and controlled by government imposed contracts.

I feel sorry for the incoming new Transport Secretary. It is certainly not his fault that the west cost franchise competition was bungled. He has the unwelcome task of trying to pick up the pieces. He has to find a way of running the services on expiry of the current franchise. He needs to lead his Department to higher standards of administration and adjudication on contracts.

What is curious is the attention the Opposition and media will give to this relatively minor losss – a mere £40 million – when they conspire to ignore the much larger losses I have been talking about revealed in the nationalised Network Rail accounts through dealing in derivatives. Why is a £40 m bungle on contract award a scandal, and another £560 million loss last year on derivatives all part of good management? I have released the information about the losses on local radio (BBC) and through the Wokingham Times, as well as on this site. The national media is not interested.

The reason is simple. The contract award can be attributed to Coalition Ministers. Justine Greening can be dragged into a difficult debate about responsibility. The losses at network Rail are losses from an arms length company set up by Labour, so they have to be ignored or explained away.The media will either ignore it or accept the company’s view that it was necessary because they chose to borrow in foreign currencies. Quite why a company earning its money from the UK wanted to borrow foreign currency money has never been explained satisfactorily.

So was Justine Greening responsible for the bungled contracts? The Opposition will claim she was. They can say that Secretaries of State are responsible for all the decisions taken in the department in their name. In theory they can challenge all advice and overturn all recommendations, as long as they stay within the law, so they are ultimately responsible. In office, of course, Labour Ministers often had reasons why this tough doctrine did not apply to whatever mistake their department had made at the time.

In practise I suspect Miss Greening was assured the complex homework had been done well. She would have received a high level submission summarising the findings on all the bids. She probably signed off on that, wishing to trust her senior officials who had supervised the work. She would have been briefed to claim the process had been “robust”.

I suspect the establishment will decide this was one of those unfortunate errors made owing to an imperfect system. The suspended staff will be allowed back to work. Lessons will be learned. The storm will be ridden. Meanwhile the railways will continue to lose far bigger money than the odd £40 m error with a wonky calculator.

Some will perversely think the answer to all this is even more government intervention in the railways, as they deliberately duck difficult questions about the mounting losses at Network Rail. I don’t suppose they will rush to re-examine the assumptions and figures on HS2, which remain far from convincing to many.

Tonight’s Panorama was an excellent expose of “soft touch Britain” which we have talked about on this site. They developed work by MPs like Chris Skidmore and Henry Smith who have exposed some of the detail of the ways the NHS is now no longer the National HS but the International HS, offering free services to people from all round the world. It was a good example of how the BBC standing up for taxpayers can make a great programme which is most useful – it’s just a pity they stand up for taxpayers so infrequently.

The programme showed how anyone can register for free treatment with a GP; how illegals and fictitious people could register and obtain potential access to hospital treatment where they are meant to pay; demonstrated that the Uk issues cards to false applicants for European health Insurance where UK taxpayers have to pay for treatments using them; fails to collect much money from European governments for all the reciprocal treatments we supply here; and how the UK has a bad deal with the Republic of Ireland over treatment for retired people.

Anna Soubry, the Health Minister, just kept saying to each scandal that they were reviewing the situation. We offered the Health Department a 10 minute rule Bill recently, thanks to Henry Smith MP, which would have helped plug the gap. They declined to adopt it. The Minister had no explanation of why recent guidance has said GPs should offer free registration to anyone who asks, and no answer to hospitals who rely on the fact of GP registration to act as a passport for hospital treatment to which the people are not entitled.

Whe Parliament is back MPs will be pursuing this matter again. We are talking about hundreds of millions of pounds of loss to the NHS in these various ways. Ms Soubry needs to raise her game, and show some urgency and some sympathy for long suffering taxpayers who foot the bill for this injustice. I did talk to her privately when she was first appointed and said to her this was the number one concern of many about the finances of the NHS.

Modern politics is dominated by a very simple theory. It is a dumbed down version of Blair’s triangulation. The theory states that a party of the left has to attack the left and show it is moving towards the centre to attract the floating voters there, whilst a party of the right has to attack the right and show it is trying to occupy the centre ground in its turn.

As with so much modern politics there is little thought and lots of spin. As I have argued before, the idea of “left” and “right” is far from a good way of analysing modern politics. Is David Davis of the left for wanting more civil liberties? Is Yvette Cooper of the right for wanting more state control and more police to improve public order and safety? Is a Eurosceptic Labour figure right wing because he is Eurosceptic? Am I left wing because I want to end our military involvement in Afghanistan immediately? And so on.

We should also question who all these voters are, huddled on the centre ground. They may dislike both Labour and the Conservatives, but many of them are far from being in the middle between Labour and Conservative positions. Indeed, Coalition and Labour positions on many things are so closely together, that it would be difficult to find people camped between them. Both the Coalition and the Labour front bench support quantitative easing, a high deficit, reducing the deficit in due course, increasing current public spending, cutting public capital spending, owning loss making banks, staying in the EU as currently constituted, welfare reform to make it more worthwhile working, more Academy schools and the rest.

Indeed, because both main parties believe the theory of moving to the centre, it is inevitable that they end up together on many issues, bumping into each other with enthusiaism to show how moderate and centrist they are.

The floaters, however, are a very varied group with many differing views. Many of their views lie well outside the polite spectrum of views espoused by the three main parties. Large numbers want to pull out of the EU altogether. Many wish to restrict immigration very tightly. Some think both Coalition and Labour are far too generous on benefits to the workshy and recently arrived. Many think both main parties are too weak on crime and punishment. Many think politicans of all persuasions overpay themselves and waste loads of public money. These people would be said by the sloppy theorists to be well to the right of polite society.

Others think both the Coalition and Labour are far too mean on state pensions and other benefits that matter to them. They think students should have grants, not loans. They think the state should be much more generous over care for the elderly. They think the state should do more to regulate every aspect of private sector commerce which annoys them. They are said to be to the left of the main parties.

The problem for the theorists is both groups are not in the centre but outside the parties narrow definition of the acceptable and affordable. Worse still, many people have elements of both agendas in their thinking. You meet people who want to pull out of the EU and have a higher pension, and who say stopping the EU contributions would help pay for it. You meet people who both want to have fewer migrants here, and who want more generous care for the elderly. Voters refuse to be pinned down in the silly left-right boxes the politicians and their analysts often use to decribe the people they wish to represent. They should get out more and listen to the voters.

Labour are saying they would have a thorough review of public spending. They would examine everything currently being spent, using the technique of the zero base budget. Nothing is in such a budget until it is examined and newly approved.

There is a lot to be said for the Coalition government doing just such an exercise now. It is good advice from Mr Balls. If we leave it until after the next election, that gives another couple of years of potential wasteful spending.

It also, of course, means Labour can refuse to tell electors what they would cut were they to be returned to office. Their mantra can be permanently that it will all be up to the review. If the Coaliton behaved as Labour used to do in office, it could invent all sorts of cuts and claim that Labour was likely to do them if in office. Labour would then be drawn into denying certain things would be cut, pre-empting their thorough review. Such is the name calling and scaremongering that we have become used to accept as an alternative to having a mature debate about priorities and value for money.

What should such a review probe most strenuously? There are many easy targets. I list a few beneath

1. Network Rail’s large losses on derivatives and their foreign currency funding (£560m last year)
2. Early withdrawal of the troops from Afghanistan – for reasons mightier than merely saving money
3. Overseas Aid to countries that have nuclear weapons and space programmes (£485m)
4. Overseas Aid through the EU (£1.3bn)
5. The Overseas Aid Department’s large research programme and extensive use of consultancies (£800m plus)
6. The UK contribution to the EU budget
7. The size and growth of the EU budget
8. EU regional policy expenditures
9. Need to charge overseas users of the NHS
10.Subsidies to dear energy sources
11. Possible sale of state owned banking assets and companies
12. Sale of commercial forests that are not heritage sites and heritage woodlaands
13.Increasing the proportion of affordable housing for sale, so the state can release more capital from disposals
14. Stricter enforcement against illegal migrants coming to pick up benefits and other support payments
15. Repatriation of foreign prisoners

There are so many items that the list could extend for many columns. Your ideas, as always, could be helpful. The Coalition is going to have to look again at its high spending levels, given the slippage on borrowing. It’s topical again to consider priorities and better value for money.

Ed knows how to woo the Unions. His threat that the banks will have to be split, detaching investment banking from High Street banking, will be popular with the Unions. It will send a subliminal message to the many that Ed is on their side, because he is against the big banks.

It does not seem very likely,were there to be a future Labour government. After all, the last Labour government encouraged the build up of the large comglomerate banks. It welcomed the foolish mergers which brought about RBS. It flagged them through the system. The regulators just stood and watched as the debts were heaped up. It helped push HBOS into Lloyds arms. It left state owned RBS intact, and appointed management with the task of trying to make it a successful conglomerate.Seeking the break up would be quite a volte face from previous policy.

Simply splitting investment banking from High Street banking would not have stopped the 2007-8 crisis anyway. Northern Rock, Bradford and Bingley , Freddie and Fannie, were all regular mortgage banks. They were not brought down or put into financial difficulty by irresponsible investment banking arms. Threatening to enforce the split in a global bank like HSBC might simply lead to it leaving London, or might prove beyond any UK government’s jurisdictional reach.

The one bank that could be split up, and should be split up, is RBS. It is a pity the Labour government did not do it in 2008-9. It is a pity the incoming Coaliton government did not issue new orders and negotiate new requirements and contracts with the incumbent Board in 2010, and seek to break it up then. Cross party consensus on splitting RBS would now be welcome.

Those few of us who argued in 2008 that RBS should have been put into controlled administration, with short term liquidity support and proper deposit protection, were shouted down. Instead government decided to bail out the bondholders and lose a fortune on buying shares. Now we have won the argument for a “next crisis”. The Vickers Report, the FSA and the governmant all agree that any future large bank in trouble should be put into controlled administration, following its “living will”.

If that makes sense for a future crisis, why don’t we get on and do it now to clear up the large overhang of the last crisis? Whilst RBS is largely state owned, it provides a means of testing the theory.