Ministers and Whitehall culture

Whitehall has many talents and strengths that Ministers need to use and motivate to do their jobs. They also need to be aware that there is a kind of default mode that applies to many policies and areas that does not reflect the mood of many to make a success of Brexit and to use the freedoms it brings to help create a more prosperous and successful UK.

There are many in Whitehall who seem to regret our exit from the EU and wish to stay close to EU rules, laws and policies.  There is a readiness to take what the EU says as right and necessary and to see anything we do differently as unwise . We see this most obviously in the reluctance to sort out the Northern Ireland Protocol by failing to press on with legislation to uphold the parts of the protocol that respect our internal market and reflect the wishes of Unionists as part of the Good Friday settlement. We see it in the reluctance to challenge the EU over our residual payments to them, to push back on their aggressive stance to cross border trade and in the unwillingness to remedy bad past EU legislation. One and half years on from exit and still there has been no repeals Bill, no major changes to VAT, no regaining of our fishing industry.

There is then the similar enthusiasm for a range of other international bodies. Many in the public will be alarmed if Whitehall wants us to sign a health Treaty giving powers to the WHO over the NHS.

The major controlling idea in Whitehall apart from welcoming every form of global government over us is the priority afforded to net zero policies over almost all others. This has led to the accelerated decline of domestic energy with increasing reliance on unreliable and expensive imports. Far from cutting global CO 2 this I’ll judged response has increased world CO 2. It is leading to the wilding of the UK to reduce the amount of food we grow for ourselves at a time of worrying international shortages. It is often self defeating in its own terms, as we come to rely on foreign products for our needs which produce more CO2 globally than if we had made or grown them at home. It runs down too many U.K. industries as they propose we import more instead.

These are some of the things Ministers need to change.

What happened to the Nightingale capacity?

Question:
To ask the Secretary of State for Health and Social Care, what happened to the beds and medical equipment from the Nightingale hospitals. (90312)

Tabled on: 09 December 2021

This question was grouped with the following question(s) for answer:

  1. To ask the Secretary of State for Health and Social Care, what the total cost was of setting up, running and closing the Nightingale hospitals. (90311)
    Tabled on: 09 December 2021

Answer:
Edward Argar:

Total projected funding for the Nightingale hospital programme was ring-fenced at £466 million. National Health Service providers are currently auditing the accounts for 2020/21 and the final spending outturn will be published in due course.

NHS England and NHS Improvement advise that regions were responsible for co-ordinating the redistribution of assets including beds and medical equipment from the Nightingale hospitals. Each host trust is responsible for managing a list of these assets. The remaining surplus stock has been collected and made available for national redistribution under the existing warehousing, asset tracking and logistics contracts.

The answer was submitted on 15 Dec 2021 at 14:57.

The role of Ministers

There have been too many changes of Minister under Labour, Coalition and Conservative governments. If the civil service think someone may only be in post for a year or so they can delay or impede actions the Minister wishes to take that they do not favour. Frequent changes of Minister means frequent changes of attitude and decision making in ways which may be unhelpful. Ministers are often allocated to a department without proper consultation or discussion of their skills, knowledge and interests. From the moment they arrive in office they are expected to be able to answer a range of difficult questions and make well informed decisions with no training for that role.

Ministers have to perform a variety of tasks. They are there to represent their department in government and to the country. They need to argue its corner in government debate and policy formation. They need to approve necessary actions by civil servants to administer the body of inherited policy and to enforce the inherited law in their area. They need to be the complaints department, seeking improvement and redress where things have gone wrong. They need to make judgements in difficult cases and situations which are brought to their level for decision.

They also need to remember they are elected with others to carry through a vision and a set of promises from a Manifesto. They need to be the change makers in the department where change is needed and where the case for change has been accepted by the public in an election and or made and accepted by Parliament. They may need to reallocate resources, establish new programmes, put through new laws , address new issues.

Ministers will see when they arrive that the department has a culture and a set of defining attitudes towards policy and its tasks. Some of this will be well based and the Minister needs to learn and reinforce it. Some of it will be contrary to what the Minister and government are trying to do, where the Minister should make the case for change in the department and offer leadership to correct what he or she sees as wrong or misguided. It is no defence for bad policy or decisions to say the Minister followed the official advice. It is best where the Minister knows about the matters being discussed and has past qualifications and experience that are relevant as in most other jobs. Where this is not possible a Minister should be kept in post long enough to learn the job and do it well for a bit before being moved.

The civil service should do more learning and less churning

There is some interest in civil service reform, both by Ministers and senior civil servants. Both can perform better, and both see that there are difficulties over some issues and in some departments. Today I wish to concentrate on how the civil service can respond to public needs and Ministerial decisions. I will do another piece on how  Ministers can give good leadership.

The recent covid crisis showed the best and the worst of what is on offer. The existing NHS medical staff and senior management provided a lot of emergency care in difficult circumstances at some risk to themselves whilst medical science caught up with the disease and developed medicines and vaccines to combat the virus. Ministers opted for new leadership outside NHS management to drive the vaccine development and purchases very successfully. The NHS took time to test and bring on stream drug treatments.

The civil service appoints a lot of generalists and then rotates them through a wide range of  very different roles, with a few emerging to the top with a general knowledge and experience of quite a lot of government. There is substantial reliance on outside consultants and advisers for technical and professional matters. An individual often has to move onwards and upwards quickly to get salary advances and to show they are the kind of talent that can rise higher.  The danger of this system is twofold. Individuals do not gain sufficient expertise or a wide enough range of contacts to do any particular ,job well given the limited time in it. No-one is responsible for much, as projects, policies and services are shaped by a succession of people and go wrong under a range of people. If a person knows they will move on soon it must affect their degree of interest in and disclosure of things that are not working well.

There is a good  case to be made for expecting people to stay for longer in posts and to back them with training and support so they become expert in their field. They should be given increments on salary scales for doing a good ,job whilst staying in post, and or promoted within the same area so the expertise is not wasted.  The civil service should contain more of the expertise it needs and should reward it.

If we take an area of weakness, large scale procurement, it would make sense for senior people involved to expect to have to stay with the contracts they have designed and signed through a meaningful period of years  of fulfilment, with possible bonuses for successful quality and cost outcomes. If it is say a 7 year project why not stay to see it to success?  Whilst of course Ministers remain publicly responsible for all that is done, well paid senior civil servants should beneath that public accountability take responsibility for all their considerable delegated powers. They need to be rewarded and praised for using them well, or corrected or disciplined for using them badly as in private business.

The attempt to divide administration of policy from design of policy led to a proliferation of Executive Agencies. Their Chief Executives are civil servants, but they have some Ministerial type powers and duties as they have a public face and can  speak for their bodies.  Where there is a cross party accepted  and largely unchanging task like issuing passports or vehicle licences there is something to be said for this approach. It needs to be sharpened so that again the CEO and senior management  is rewarded for success but held accountable for failure. The model starts to break down where policy and execution are much more entwined and the resulting quango is powerful. The NHS and the Environment Agency are differing examples of large bodies with public chief executives where Ministers are held responsible for their actions by the public. In these cases it is essential the Ministers have full access to data and an ability to influence the CEOs as their work is central to the democratic process and is often highly contentious between parties. Not everything should be in external agencies.

World Health Organisation Treaty?

I¬† understand people’s concern about the UK signing a world Treaty on healthcare that could make running the NHS difficult or otherwise constrain good UK policy choices. There are a lot of false rumours flying around. As there is currently no draft it is¬† not possible to say much¬† on the wisdom or dangers of this particular idea.

The WHO has set up an International Negotiating Board to try to draft a binding Protocol over future responses to pandemics. The timetable is according to the WHO as below.

  • The INB will host its¬†second round of public consultation hearings¬†on 16-17 June 2022.
  • The INB will meet by 1 August 2022 to discuss and consider a working draft treaty.
  • The INB will deliver a progress report to the 76th¬†World Health Assembly in 2023.
  • The INB will submit its outcome for consideration by the 77th¬†World Health Assembly in 2024.

Those wishing to influence or oppose this development should respond to the consultation. I have already made it clear I do not favour the UK signing a Treaty but we should take good ideas from WHO and implement them as appropriate.

Inflation

Fast inflation is damaging to jobs, activity, savings and the conduct of economic policy. Hyperinflation, inflation above 50% a month, destroys an economy completely, making normal economic activity for wages and money receipts near impossible. Venezuela has  hyperinflation thanks to printing and borrowing too much, and nationalising and price controlling much of what is left of Venezuelans of industry. Maybe incomes and output have halved as a result. It is difficult to measure their economy with the daily surges in prices. Argentina has inflation of 55% and is trying another IMF programme to get it down a bit. Turkey has allowed 70% inflation by expanding money and state borrowing too much. These are the warnings to advanced countries not to let inflation rise further and embed.

The main advanced countries led by the USA with inflation at 8.4% and the EU with inflation at 7.4% have inflation at similar levels to the UK for similar reasons. The US and the EU printed huge quantities of dollars and Euros throughout  2021 triggering first an asset price bubble and then upwards pressure on goods.  It is true all have suffered from a sharp rise in energy and food prices, in part owing to the Russian invasion of Ukraine. This however, has also been experienced in China and Japan which have inflation rates of around just 2%. China pursued a tougher monetary policy. Japan always gets away with massive money printing and borrowing probably owing to the cautious consumers who avoid excess demand. Switzerland, another large energy importer, has also kept inflation under control.

The UK authorities started to rein in their monetary excess late last year. We are now living through the inflation based on last years excess. Owing to price controls on energy the full effects on inflation were delayed until April and maybe also until the autumn when there will be another catch up increase. This year’s tightening should mean a sharp decline in inflation next year as the Bank is now forecasting. The European central Bank is still printing¬† more Euros and keeping interest¬† rates at zero. So they are still risking continued high inflation. Maybe they hope the evidence of slowdown and possible recession will be sufficient to lower the price rises.

There are several lessons the UK authorities need to learn from these experiences. The first is you cannot carry on printing and borrowing when you are well into recovery. The asset inflation is likely to spill over into goods and services. The second is imposing price controls on an essential like energy does not protect people from inflation in energy prices for more than a few months. The price rises catch up with you. It also means more losses to be absorbed by taxpayers on the businesses that go bust and need rescuing as a result of the price controls. The government should drop this approach. In the short term government is the great  winner from inflation. Its revenues go up as prices and wages go up. The real cost of repaying most of its debt go down as savers are swindled out of the real  value of their savings.

The need for a growth and an inflation objective

It is good news that the traditional media at last recognises there is both an inflation problem and a growth problem. I welcome recent converts to the cause of exposing errors by the Bank of England and the Treasury that have given us too high an inflation rate and now look as if they want to deliver us too slow a growth rate.

I see Liam Fox criticising  the Bank and the cross party Treasury Committee daring to take a rare peak into the policy errors of a Bank they wrongly say is independent. That is the same Treasury Committee that insists on interviewing a potential new Governor of the Bank and deciding whether to approve the appointment! The Chancellor of course approves and indemnifies the Bank against all money creation to buy bonds under Quantitative Easing anyway.

I would like the various worthies of the Treasury and Bank establishment, official and elected, to conclude two simple things. One, the Bank and Treasury need to work together on a common policy. Two, that policy should target 2% inflation and 2% growth as the longer term average. If the Governor gets to the point where he or she thinks the Chancellor is inflating  too much and will not listen they should resign. If the Chancellor thinks the  Governor is deflating  too much and will not listen he or she should remove them. All this would become public and allow debate and Parliamentary input.

Whilst printing too much money is usually inflationary and is mainly a matter for the Bank, running an economy with too little domestic capacity and enterprise can also be inflationary and mainly needs a government response. Inflation can come from excessive private sector credit build up, susceptible to Bank controls on the commercial banks and to interest rates. It can come from excessive demand and borrowing by the state sector, subject to government control of budgets.

Today Bank policy has corrected from the very inflationary. Government policy is insufficient to tackle capacity shortages. Neither Bank nor Treasury has rolled out a proper growth strategy which is much needed.

Conservative Home article on Northern Ireland Protocol

Sir John Redwood is MP for Wokingham

Brexit was a vote to take back control. Remain tried to turn it into a narrow discussion of trade and trading arrangements, denying much more constitutional significance to the EU. Brexiteers wanted our country back. We knew that greater prosperity and freedom as a result would depend on what use Parliament made of the freedom to make our own choices. The public, in anger at the way the 2017-19 Parliament tried to undermine the verdict of the people and tie us back into much of the EU’s laws and arrangements, voted for the big Brexit majority in 2019.

Given the hassle and the anti-democratic efforts of so many in a Remain-dominated establishment to keep us close to the EU, it was understandable that the Prime Minister would rush through a Withdrawal Act before the last election when he was still hamstrung by the absence of a Brexit majority.

After the Conservative win, he speeded up negotiations on a future relationship. The EU had insisted on a two-stage process, agreeing terms of withdrawal, leaving and only then negotiating a future relationship. A possible trade agreement to supplement WTO most favoured national trading that would otherwise apply helped them more than us, but was used by the Remain establishment to keep us closer to EU rules.

The EU broke its own interpretation of EU law which it said necessitated this phased approach by inserting a Northern Ireland Protocol into the Withdrawal Agreement which did tackle some future relationship issues which were meant to be out of bounds at that stage.

The Protocol it drafted was contradictory and ambiguous. It contained a lot of clauses requiring Northern Ireland compliance with the EU Single Market, but it also included clear statements that Northern Ireland would be part of the UK’s internal market and would benefit from UK free trade deals, and that Northern Ireland’s status as part of the U.K would be confirmed.

Both sides recognised the Protocol did not represent the final answer, which is why it included Article 13.8 which provided for cancelling or replacing it in due course. It was assumed by many there would be a clearer statement in the future relationship treaty. When it did not produce one, Northern Ireland was left facing an uncertain future. Conflicting jurisdictions in the EU and U.K took very  different views of what the contradictory and ambiguous document meant.

The EU decided on a maximalist interpretation, imposing or seeking to impose a vast array of controls and checks on internal U.K. trade passing between Great Britain and Northern Ireland. The U.K. politely spent two years asking for some give as well as take from the EU with no success. The Unionist parties in the recent Stormont elections suffered from the damage done to Great Britain/Northern Ireland trade, and to the sense of identity of the Unionist community in Northern Ireland by the intrusion of the EU into  their lives.

The U.K according to the EU cannot change VAT in Northern Ireland when we change it for Great Britain against EU laws. Northern Ireland has to accept an avalanche of new law from the EU every year while Great Britain does not have to accept or legislate for anything similar. Northern Ireland gets no vote or voice on the laws the EU imposes

As a result, unionist members of Stormont are refusing to join an executive or government in Northern Ireland until the Protocol is removed or substantially amended. They see an EU understandably on the side of its member state, the Republic of Ireland ‚Äď out to govern against their wishes and interests, forcing on them an unwanted border between Great Britain and Northern Ireland and many costs and impediments to Great Britain/Northern Ireland trade. The U.K. has refused to implement all of them, but the ones already in place are damaging enough.

The Government needs to take action to remedy this big problem. The Belfast Agreement which established peace in Northern Ireland after years of violence is important and is rightly backed by the President of the USA. This agreement has now been undermined by the Protocol . Both the unionist and the nationalist communities need to give  their consent to any major decision in Northern Ireland. The Unionists do not consent to the Protocol which they think undermines the Act of Union and deprives them of full and equal membership of the Union of the U.K.

As the EU seems to delight in forcing Northern Ireland against its will into dependence on EU laws and rules that the Government must act soon and unilaterally  to remedy this. The EU mouths its meaningless and wrong soundbite that the UK and Northern Ireland have to stick to an international treaty and must not break their law. The truth is that the EU is failing to carry through the parts of the Protocol it does not like and has damaged the Good Friday Agreement. It is controlling parts of tax policy in Northern Ireland and stopping British supermarkets delivering food to Northern Ireland’s shops.

The U.K. anyway has the power to legislate independently reserved carefully in the crucial Clause 38 of our Withdrawal Act which is the only form of the Treaty which has power in U.K. law. That Article reserves the right for the U.K. to assert its sovereignty over any of these matters if it needs to. The Government could also operate legally under the terms of the Protocol itself as Article 16 allows us to take unilateral action where the other party has damaged the economy and society of Northern Ireland and or where trade with the U.K. has been impeded. Clearly, both tests have been met.

Many British businesses have stopped selling into Northern Ireland or have streamlined what they sell faced with ridiculous EU imposed checks. More importantly, the delicate balance between the two communities has been fractured with unionists wanting their country back. It is important that the Government upholds the Belfast Agreement. That means explaining all this to US Democrats who do not understand the Unionist position or the legal background

It means acting unilaterally and fairly to take control of Great Britain/Northern Ireland trade whilst guaranteeing the full force of the state to prevent non-complaint goods travelling into the Republic. It means standing up to the EU as it mouths falsehoods and threatens illegal responses. Brexit is not done all the time it does not extend to Northern Ireland. Our Union is not safe all the time  the people who believe most in it are treated so badly.

Why the Bank got it wrong

 

The Sunday Times ran a topical joke.” Two members of the Bank’s Monetary Policy Committee walk into a bar. You’d think¬† one of them would have seen it”. It is not good when the Bank’s ability to forecast and to carry out its main task of keeping inflation to 2% is cause for wide ranging ridicule and censorship. Let me try and explain a little more why inflation is so high and who is to blame.

The first thing necessary to have a more adult debate is to understand the very considerable limits on so called Bank independence. When the Bank first starting printing more pounds to buy up more bonds in the policy called Quantitative easing the Chancellor, Mr Darling, insisted on the Treasury agreeing the sums. The Bank wanted an indemnity against losses on the bonds from the Treasury and taxpayers, so the Chancellor demanded the he and his successors signed off the amounts of any such policy. All Chancellors since have done so and continued the indemnity.

The second thing to grasp is that the  main reason inflation has set in badly here, in the USA and in the Eurozone is that all three central banks printed too much money. The Chinese and Swiss Central Banks did not do this and their countries have today inflation around  2% despite also experiencing the sky high energy prices and rising food inflation. Countries like Turkey and Argentina which have printed even more have much higher inflation rates.

So we need to ask why did the Bank of England recommend and execute a policy of creating an extra £450bn and buying bonds with it from 2020 to end 2021?  They decided that the large contraction in economic output triggered by the wide ranging and long lasting lockdown of the economy from March 2020 required a substantial monetary offset. As rates were already low and they thought they could take only  them down to 0.1% they needed to inject large sums of additional cash into markets. They were also conscious alongside the Fed that in March 2020 the fears of the impact of lockdown were causing a financial and banking market collapse which needed large sums in liquidity to offset.

I think their judgement in March 2020 was right and I strongly supported it. I also supported the Treasury action it made possible, of borrowing huge sums to return some income and  cash to the many people and firms that were losing income from the shutdowns. The two actions went together. The state could only borrow that amount at a very affordable rate if the Bank printed money to help them. The impact was not inflationary overall as so many activities were stopped or greatly reduced by the controls.

Unfortunately in 2021 the Bank continued to print money and keep interest rates on the floor long after a good recovery in activity had taken hold. The government continued to borrow and spend on huge scale on a series of special programmes where test and trace was the largest. This was bound to be inflationary, though the Bank ignored those of us who warned it to stop printing. The government continued with expensive lockdown style policies for longer even though vaccines and treatments had greatly reduced death rates from the virus . The economy revealed a number of crucial supply bottlenecks as lockdown measures had damaged UK and global capacity in various areas.

China and Switzerland show that even with sky high energy and dear food it was possible to keep inflation down. The Peoples Bank of China have monetary targets and think controlling the amount of new money is an important part of controlling prices. The Bank of England do not bother to monitor and control the amount of cash . They prefer to believe the unlikely proposition that if you print a load of money and give it to people and businesses they will use it less. That was true in lockdown but they wanted to spend when lockdown tailed off. Maybe the Bank should start to take money growth more seriously.

It was a  pity that China who got inflation right was busy trying to correct a credit bubble in property they had allowed. There are many features of the China approach it is better not to follow. The question for  Bank of England MPC members is when you saw those piles of cash you were printing, why did you think people would not use them? Or was it you did not see them because you did not bother about the  money supply?

 

Signing international Treaties

The U.K. has signed too many Treaties in my life so far. They seek to bind the country in for the long term. Where they succeed it offends one of our fundamental democratic principles that one Parliament cannot bind a successor. If a government signs up to a Treaty obligation which the Opposition disagrees with then it is particularly offensive as the incoming Government will find it difficult to disengage. I and my friends had two wins when both main parties wanted to sign the Maastricht Treaty. To secure it through Parliament the government had to gain the opt out from the single currency, the main point of the Treaty. It also secured an exit clause from the EU as a whole, which transformed our options and outlook.

Other Treaties do not offer such good opt outs or fail to include an exit clause. They become ways of freezing policy on an issue to the global consensus at the time of their making which may prove wrong or damaging. I do not think it would be a good idea to sign a binding Treaty designed by the World Health Organisation based on the current level of pandemic knowledge. We should learn from their data and experience and incorporate their best ideas in our future health management but not bind ourselves in.

All Treaties are in practice subject to revision or termination if all the signatories come to agree they are outdated or wrong. Some Treaties are necessary to settle a peace. These should not be disrupted by a losing combatant when they get stronger, but may need UN or other external guarantors. Treaties about everything from the environment to health usually go too far in crimping democracy. Sign too many and swathes of self government are constrained or prevented, or a future government has to exit them or amend unilaterally how to interpret them.