The PM spent our money and his time flying to Yerevan to attend the European Political Community meeting, without a thought for all the extra CO2 he could have saved by joining on line. After the meetings there we can read a full statement of the parallel EU-Armenia Summit  which also took place set out by the Commission. This is a  report of a very detailed meeting setting out how Armenia can conform more with EU rules and participate in more EU programmes in preparation for eventual membership.  It is set in the context of the EU wanting Armenia to complete a Peace Treaty with neighbouring Azerbaijan, and improve relations with Turkey. The EU has a political vision of the future of Caucasus region which it wishes to enforce.

The President of Azerbaijan attended the European Political Community on line and is reported to have been critical of the EU for taking a pro Armenia stance and for taking provocative actions as he sees them  with one sided intervention in the  disputes between his country and Armenia. The Turkish President was invited, but instead Turkey’s Vice President joined on line. Two of the key themes of the meeting were ” Regional stability in the south Caucasus” and ” Building the future: Unity and Resilience”

The Ukraine President  attended and made a plea for more military and financial help in resisting Russian aggression. The meeting favoured a negotiated solution for the Middle East, whilst  continuing with the war against Russia in Ukraine.

So what was the UK’s view on these important issues? Did the PM support the conclusions on how to bring peace to the Caucasus? What does he think about the further extension of the EU eastwards and the impact that will have on the region?  What is the proposed UK defence and Co-operation Agreement with Poland going to include?  Why can’t we see a draft text? Co-operation on weapons procurement is fine as long as it helps both sides.

The UK government needs to understand it is not in any position to take on any more defence obligations or responsibilities. This government is running down our defence forces all too quickly, standing down and decommissioning four of our frigates and withdrawing military capabilities from the Middle East and  the Falklands and failing to give timely support to Cyprus. The PM needs to be at home finding ways to afford a stronger defence. The priorities for more spending must be a proper anti missile and drone defence for our home islands, a naval capability which can better protect our overseas territories and trade routes, and an updated independent  nuclear deterrent.

Labour 2024: “Defending our security also means protecting the British Overseas Territories and Crown Dependencies, including the Falklands and Gibraltar. “

“Labour will always defend their sovereignty and right to self-determination.”

So what happened to that pledge?

Chagos  Attempted give away with absurd £30 bn plus dowry to Mauritius.

Falklands Withdrew crucial refuelling plane from Falklands airport. Failing to reinforce defences with naval commitment despite new Argentine claims

Gibraltar Sell out Treaty with EU to make Gibraltar a colony of EU, taking rules and tax/ charges imposition from EU, allowing Spanish officials intervene in border control and making Gibraltar pay money to EU.

Cyprus base Failed to send naval cover and to provide full defence to Middle Eastern threats.Aroused Cyprus discussion of asking UK to leave.

Bermuda and Cayman islands  Stated wish to change their locally determined tax policies to drive business away from them.

 

 

 

 

At last government Ministers agree there could  be shortages of jet fuel in the summer holiday season. They should know, because their high taxes,  high energy prices and carbon tax policies have closed two refineries leaving us only 4. Both Lindsey and Grangemouth were important suppliers of jet fuel to UK airports. The government in its mad net zero way wanted to stop that and import it instead, taking its production out of our CO 2 figures to put into another country. Now it is getting difficult to get hold of imports that doesn’t look so smart.

Ministers say they are talking to remaining refiners to see if they can get more jet fuel fractions out of the oil they are processing. They should open negotiations with the new owners of Lindsey and the owners of Grangemouth to see what changes to carbon taxes and general taxes would get them to restart their works before they set about demolishing or re purposing. The UK needs these refineries. It would  add employment, some extra tax revenue and some more reliable fuel supplies if they did a deal. They also need to lighten the tax and price load on the remaining  4 refineries as they could close as well if they get into heavy losses.

It would also be a good idea to add to our oil production at the same time and encourage UK supply contracts to UK refineries to add further to security of supply.

How many more times  do we have to warn them of the huge damage they are doing to UK industry and to UK national security?

The government is wilfully wrong in saying we lost 4% or 8% of GDP through Brexit. The graphs and charts of our GDP versus France, Germany and Italy show that is nonsense.  The government  is hopelessly misled in thinking its growth strategy will spring into life if we re set with the EU.

How will paying even more for energy once in the EU carbon trading and emissions scheme help? It is ultra dear energy that is deindustrialising us at pace.

How will imposing a carbon border tax on imports from non EU help? That makes business inputs dearer and squeezes consumer spending power.

How will adopting more EU rules make us more prosperous? Their rules add costs and impose bans and limitations on business activity.

How does bringing in lots of low paid and no paid young people to the UK boost per head incomes?

How does paying ten times as much for student support to help EU students much more than UK ones help us? Why stop supporting UK students to go to non EU universities?

How does giving away so much of our fish for so many years do anything but damage to our coastal communities and fishing grounds?

If aligning with EU laws makes you richer why is Northern Ireland worse off than GB, as NI does align?

Why did the UK growth rate plunge in the Uk’s  first twenty years in the EEC, and fall further when we joined the single market in 1992?

Given how stretched our budgets are, why will paying more money to the EU help? Won’t that put up taxes or put up borrowings more, with higher interest rates as a result?

How does seeking more EU trade help GDP, when we run a large deficit with the EU and imports subtract from GDP?  We run a surplus on non EU trade which is growing faster.

The EU re set could undermine or prevent our trade deals with the TPP, US and other large overseas economies. Why risk it?

People voted for UK MPs to decide our laws and run our government, answerable to the UK voters. Making us accept EU laws we cannot change or influence undermines democracy.

 

The UK government is about to double the tariffs on imported steel to 50%,and to reduce the tariff free quotas by a massive 60%. This means imported steel  will become a lot dearer for all those steel using industries and for construction where they rely on imports. The government is using a Brexit freedom to do this.

The reason I presume they want to make steel so much dearer, raising business costs, is to protect the UK domestic steel industry. This is probably driven by their decision to make the taxpayer pay all the losses on the two remaining UK blast furnaces at Scunthorpe where the government intervened and took over managing these facilities from their Chinese owners. They did so to avoid closure and job losses, without bothering to reach an agreement on the transfer of the assets and the handling of the past debts from the Chinese company. At the time I urged them to sort out ownership and to ensure the UK would not be liable for past losses, for past debts, or have to pay any compensation on the transfer. When I last asked Ministers about how they are getting on sorting out the ownership and debt issues they declined to give details but acknowledged it remains a set of problems they are discussing with the owners. There are reports the Chinese are asking for compensation.

The most recent figure for the losses is £1.3m a day at Scunthorpe, well up on the reported  losses at the time of the transfer of management. The payments for these losses are state aid, and would require EU consent if we were still in the EU or if we realign this sector under re set. The government needs to present a Business Plan with numbers to Parliament, as this is becoming a large commitment of public spending.

They also need to explain what their longer term plan is. They seemed to be pledged to close all blast furnaces as they burn coal, and substitute electric arc steel recycling. If this is also still the plan for Scunthorpe, when do they expect to close the blast furnaces? How long do they think they can and should keep these jobs given the loss rate and the longer term plan? There is of course a case to keep blast furnaces in the UK rather than importing virgin steel, but to do so economically requires a very different approach to energy provision and costs.

What impact will the new steel tariff and quota regime have on  the losses at Scunthorpe? Will it make a big difference? Will Scunthorpe be able to sell more steel as a result? What is the estimated impact on the rest of UK industry and construction from dearer steel? The government’s attempt to save jobs could prove very costly to taxpayers, could end in the loss of the jobs, and could in the meantime just push up costs for steel users.

I am sorry the site was down yesterday. The server had problems affecting various sites. I am grateful to EccentricCoder who handle the technical functioning for me for getting it up and running using new arrangements. I  am glad  it did run a bit yesterday. There has been no interruption to my routine of a post a day.

On Wednesday  I was in the Lords for an historic ceremony. The PM decided he wanted to end the long first session of this Parliament and start again on May 14 th with a State Opening by the King of a new session. This ancient practice  allows the PM  a breathing space, the chance to relaunch the government with a new legislative  programme with  the theatre of royal ceremony to back the government.

The event takes us back to the medieval hierarchy of King, barons, knights, burgesses. The Lord Privy Seal, the senior Cabinet Minister who is Leader of the Lords, presided alongside the Lords Speaker. She told Black Rod to summons the Commons to hear  the prorogation by standing at the bar of the Lords. Once their representatives led by the Speaker were  assembled the Clerks read out recent Bills that have passed both Houses and announced royal consent. Then the Leader read a speech on behalf of the King summarising the government’s view of its legislative successes and main policies.  At the end the Commons departed and the Lords session ended.

All was done in the name of the King, though all was of course decided by the PM and cabinet. What was disappointing was the content of the speech the Leader had to read. Whilst it obeyed the rule of not making any party political points, it wallowed in complacency , often departing from reality.

It stressed the government’s commitment to growth, skipping over the reality of little growth achieved. There was no understanding of how anti growth many if its policies have been. It stressed nationalisation of rail, steel and parts of energy, without seeing how these changes will mean big losses, big taxpayer bills and disappointing results. It talked about the UK helping solve world crises without seeing the lack of engagement  with either Iran or Russia busy prolonging their wars.

I will talk about the next Kings speech  nearer its delivery. The old session dies with Labour at a historic low in the polls for a governing party, with growth stuttering, worklessness and benefits soaring, illegal migrants still coming and the cost of living squeeze still bad.

I asked a question of Lord Livermore, Treasury Minister, when he presented the Chancellor’s statement providing an up date on the Middle East impact on the UK economy. I pointed out the Chancellor said she had pledged to other countries in Washington that the UK would not place any additional restrictions on trade . When then would she cancel plans to impose high carbon border taxes or tariffs on imports? He ignored the question and complained of my support for Brexit.I pointed out after Brexit we kept tariff free trade with the  EU.

He said”

Lord Livermore “It was estimated at the time to be costing us some 4%, subsequently estimated to be 8%, of GDP, so he has put up massive tariff barriers with our biggest partner, which is not something that is in favour of free trade. He talks about it being tariff free, but he knows that the trade barriers in place are equivalent to some 20% in terms of tariff.”

He was wrong that we put up massive tariff barriers with the EU. There are no tariffs. He then alleges with no evidence and no examples  that there were new presumably non tariff barriers that were costly.This is also wrong. He misconstrues the 4% figure which was a bad long term estimate whose veracity cannot be fully tested until 2035.  The OBR said  that by 2035 our growth might be 0.25% a year less on average post Brexit, not that there would be a 4% fall in GDP. He then compares it with an 8% study which rightly said we could  fall well behind the US, as is the whole EU! That too  did not say GDP would fall or had fallen by 8%!

This is dreadful. There was no attempt to answer an important exploration of the Chancellor’s international pledge. I could also have added that the government has been busy putting  up steel tariffs.

The principle of the US revolution or war of Independence was “No taxation without representation”. It all began with Parliament’s imposition of import taxes or tariffs on products into the US. These were so unpopular most were repealed, leaving a tax on tea. That remained unpopular, so Parliament compounded the issue by giving a tax advantage and a monopoly to the East India Company, leading to the famous Boston tea party protest. Follow up legislation to punish Boston led to war.

UK governments should study this. It is an excellent extreme example of how much damage unfair and high taxation can cause. It is a reminder of the doughty independence of the English settlers who went to America to make a new life, who were impelled to self government by crass arrogance of the British establishment, and  by the inadequate bungling of the professional British army against people fighting for their freedoms.

Today the US/UK alliance is strained again. The mighty and strong US resents the failure of the UK and the EU to make a proper contribution to our own defence, preferring to rely on the US nuclear and expeditionary umbrella. The US President cannot understand the self harm of the UK refusing to use its own oil and gas reserves, weakening its national security. He is concerned about the high levels of illegal migration into the UK and EU , and critical of extra taxes and regulations imposed on successful digital corporations. He cannot understand why the UK wants to give away the Diego Garcia base to an ally of China.

The UK objects to some of the President’s language. The government rightly points out the UK military has supported many US wars in the Middle East in recent decades, and has suffered substantial losses through being in the thick of the action. The UK’s aircraft carriers are serious weapons of war, not toys. The UK does not have to join a military action against Iran that the US undertakes.

The King is doing his best to bridge the growing divide, but is getting no help from the PM. Surely this is the time to admit it was wrong to try to give Diego Garcia away? It is time to announce the UK will not be imposing carbon based tariffs on US imports in the way the EU is. The PM should urgently address the trade tensions as the US is our most important single country trade partner by a big margin.

Meanwhile, for our own national security, the PM needs to come up with a budget that can provide for our immediate defence needs. That must include early and intensive work to get  most of our naval ships ready to go on patrol again. It must include a big increase in effort on drones and robot fighters. It is esential we build a protective dome over our islands against missile and drone attack.

The PM faces further enquiries into why he did not accept due process advice to vet Mandelson before announcing the appointment, to explain why he says there was no pressure to get Mandelson appointed when officials report there was, why he has not produced many of the relevant documents to Parliament about the appointment, what action has has taken to recover McSweeney’s phone or phone and text calls, and why he did not ask more questions about Mandelson’s well know business interests and social world. He replies that this is distracting the country from the big issues posed by the wars in the Middle East and Ukraine.

So PM, here today are some questions about the way you are doing the day job. If you bothered to answer some of these that would make headlines and give us something else to talk about.

1. Why are you not getting more of our own oil and gas out of the North Sea “at pace” when it is obvious the world is going to be short of oil and gas and having some that does not need a sea voyage is a good idea?
2. Why not have an urgent meeting with the oil refiners and petro chem companies to change policy so we do not face any more closures. See if you can get the last two refineries to close to re -open, as we will need various products needing industrial capacity that is locked in or destroyed elsewhere.
3. Will you abandon the stupid policy of giving Chagos away, and reassure the US that we as the freeholders will let them use their base there as they see fit?
4. Will you re consider the digital tax and the new on line regulations, as some of these are now inciting the US to impose higher tariffs on us?
5. When will there be a statement and a Plan to tackle upcoming shortages of fertiliser, jet fuel, some pharmaceuticals?
6. What contribution will you and your coalition of the willing make to trying to find a negotiated settlement in the Middle East? When will you even talk to Iran? Will you talk to Hezbollah?