This latest site sets out how much each MP costs the taxpayer and how often MPs vote. They then calculate a “cost per vote” figure, by dividing the total costs per MP by the number of votes he or she has recorded. For those constituents interested, I am rated as 3rd cheapest at £633.07 per vote. The average cost is around twice that figure. The MP ranked 11th dearest or 639 in the cheapest rating weighs in at £6,223.29 per vote.
Author: johnredwood
Mr Redwood’s contribution to the debate on Devolution in England, 2 March 2015
Mr John Redwood (Wokingham) (Con): We are debating devolution in England, but if we are to have more devolution in England, we first need devolution to England. We must make sure that there is an English level of decision making for the strategic matters, and English Ministers who can then decide which matters could be properly devolved within their strategic framework.
If we take the case of transport, it is predominantly or wholly an English Department, yet it is treated as if it were a Department of the Union. But our Ministers have no control or influence over the roads of Northern Ireland or Scotland. They deal predominantly with English issues. In the new looser federation that we are going to create in the next Parliament, we need to identify the need for England to have rights and opportunities that equal these powers that the other parts of the country have already gained or will gain in the more generous devolution settlements now being offered to Scotland, Wales and Northern Ireland.
There is a good case for the English Transport Department to devolve some more powers to unitary, county and borough councils in the country. On the issue of railways, for example, we have a very expensive nationalised industry, which decides on the track, the track maintenance, the track investment and the principal train routes and is responsible for the signalling and most of the stations. These are very important issues for local communities.
They are massive budgets, but I found it extremely difficult as a local representative to get the ear of Network Rail and to get the right attention paid to the railway line in my area, even though my voters are producing a great deal of tax revenue which is going into Network Rail. A case can be made that there should be more devolved power to counties, boroughs, unitaries and maybe even to MPs over railway budgets, which can have a very important impact on the face of the town, the nature of the countryside and the commuter and freight services available.
We must be careful not to devolve too much. For the roads system, it is right that there is a strategic highway network of motorways and larger trunk roads which is controlled at the England level, masquerading as the Union level, and that those decisions should be properly taken by an English Minister responsible to this House, spending moneys collected in the normal national way and going through the national budgets. I hope that in due course we will have a proper English devolved budget, just as Scotland, Wales and Northern Ireland do.
In my area, we have a motorway that is a local road, and the council is responsible for it. It is a very useful and good motorway, but it stops at the boundary with Oxfordshire and Reading. Most of us want it to go over the river and on to more useful places as part of our economic growth and development. We are making a huge contribution in our area, with a lot of extra housing and jobs, and we need more road space, but Oxfordshire will not allow us to put a bridge over the river and take the road on to other parts of our burgeoning area and up towards Oxford. That may be a case where a devolved power should be given back. I think that my unitary borough would be happy to surrender control of the motorway in return for a promise from a Government Minister to finish the job and make the motorway go to other places so that it could take more of our traffic.
At the moment, a very large amount of traffic has to go through the neighbouring constituency of my right hon. Friend the Home Secretary in the small and beautiful village of Sonning, which has a single-track bridge over a beautiful stretch of the river. That takes a massive amount of commuter and freight traffic that ought to go on a motorway-standard bridge, away from a place of such great beauty, but we cannot do that because of the way in which parts of local government relate to one another. Those are two examples: one where we could devolve more once we had the right powers in England, and one where we might want to devolve less to get a better strategic answer at the national level.
The health service is also primarily or wholly an English Department. It is called the Department of Health, but it should really be called the Department of English Health because its Ministers do not run the health service in Scotland, in particular—although in the recent debates on Scottish devolution some people seemed not to understand that and to think that Scotland’s vote would somehow have an impact on their health service when it has been devolved to the Scottish Parliament. If we are going to pursue devolution, English Ministers should ask the question that my right hon. Friend the Chancellor has asked, and started to answer, in the case of Manchester. If it makes sense for Manchester to have more control over health budgets at local authority level to try to deal with the big border issues between social care and health, it must make sense for other parts of England to have exactly the same type of thing.
All my life in active politics and in government, as a local government Minister and in other roles such as Secretary of State for Wales, I was very conscious that there were always border issues between the UK-wide nationally controlled health service and local government, dealing with social care. Both sides were prone to blame each other. The health service would say, “We could get our costs down and put more people through our hospitals if only local government did a better job on providing care facilities for people who should leave hospital,” and local government would say, “Our budgets have been starved because so much money goes to health, but perhaps that isn’t the right priority, because it is a lot more expensive to keep someone in a hospital bed for a few extra days when they do not need the urgent care any more than it is to provide them with good care in a care home without all the medical staff and additions that you have in a hospital.”
There has always been that problem, and I look forward to seeing the more detailed work and the results of the negotiations, because it would be good if there could be a new solution. Once again, however, we need to make sure that the right things are defined at the England level, because it is still meant to be a national health service, although there are now going to be several different national health services because of Scottish and other devolution.
In relation to England, I think that a lot of our voters in England want there to be national standards, a national level of service, national protocols and national agreements, so quite a lot needs to be settled by an English national Minister sitting in the English Health Department. However, we can see whether we can devolve certain things. It would be really good to have a new and novel solution to the cross-border issues between social care and health care.
The third Department that is already clearly an English Department is the Department for Communities and Local Government—the origin of this debate. The Select Committee has produced an interesting report to influence English local government Ministers. They must make sure that they have unrestricted English control over English local government, and I am sure that many of them, in this Government and successor Governments, will be interested in exploring the big issue of how many more things can reasonably be left to councillors and their serving officers to decide.
I look forward to there being more things and I have suggested one, namely railways, but we need to be realistic and understand that people also want a national agreed level of service. They also want to know that, when a decision in one place has a consequence on other places, people above the fray of the locality will be making the decisions. Not all the decisions will go downwards; some will have to go upwards.
Above all, we need justice for England. We need English votes for English issues and to make sure that England has a voice and can decide the things that apply only to England.
Government Statement on Starter Homes, 2 March
The Minister of State, Department for Communities and Local Government (Brandon Lewis): I would like to update hon. Members on the outcome of the Government’s consultation, launched by the Prime Minister in December, seeking views about our proposals for planning reform to support the development of 100,000 new high-quality, low-cost starter homes for young first time buyers.
We are determined to ensure young people are not denied what their parents took for granted— the opportunity to buy their own home, settle down and enjoy the security that home ownership brings. Nearly 192,000 households have now been helped by the Government to buy or reserve a home since 2010, through schemes like help to buy and the reinvigorated right to buy. But we know there are still far too many hard working young people from all walks of life struggling to gain a foot on the property ladder, so we want to go further and give them access to a new generation of high-quality, low-cost starter homes.
Our starter home consultation proposed the introduction of a new national exception site planning policy to enable starter homes to be built on under—used or unviable commercial or industrial sites not currently identified for housing, on both public and private land; for these starter homes to be only sold to young first time buyers at a minimum 20% discount below their open market value; that local planning authorities should not seek section 106 affordable housing and tariff-style contributions on starter homes; and they should be exempt from the community infrastructure levy to enable developers to help deliver the discounted sale price.
We received over 250 responses to the consultation. There was strong endorsement from prospective first time buyers for the starter homes policy. Many local authorities, developers and lenders also endorsed more support for first time buyers, and made helpful comments about how this new planning policy could be implemented. The Government have published their consultation response today, and I will place a copy in the Library of the House. It will also be available online at: www.gov.uk.
After careful consideration of these responses, the Government are today making the following change to national planning policy:
Local planning authorities should work in a positive and proactive way with landowners and developers to secure a supply of sites suitable for housing for first- time buyers. In particular, they should look for opportunities to create high quality, well designed starter homes through exception sites on commercial and industrial land that is either under used or unviable in its current or former use, and which has not currently been identified for housing.
Where applications for starter homes come forward on such exception sites, they should be approved unless the local planning authority can demonstrate that there are overriding conflicts with the national planning policy framework that cannot be mitigated.
Planning obligations should be attached to permissions for starter homes on starter homes exception sites, requiring that the homes are offered for sale at a minimum of 20% below open market price, to young first- time buyers who want to own and occupy a home. They should also prevent the re-sale and letting of the properties at open market value for a five year period.
In view of their contribution to meeting housing needs, starter homes exception sites should not be required to make section 106 affordable housing or tariff-style contributions.
Exception sites may include a small proportion of market homes, at the planning authority’s discretion, where this is essential to secure the required level of discount for the starter homes on the site.
Starter homes developments are expected to be well- designed and of a high quality, contributing to the creation of sustainable places where people want to live, work and put down roots to become part of the local community. A new design advisory panel set up by the Government, involving leading industry experts, is developing an initial set of exemplar designs for starter homes which we expect to publish shortly for wider comment. While recognising the need for local flexibility, we would expect these designs over time to become the default approach to design to be considered for starter homes developments.
This new national planning policy should be taken into account in plan-making and decision-taking, and should be read alongside other policies in the national planning policy framework.
We will shortly publish revised planning guidance to assist local planning authorities in implementing this policy change. This guidance will support implementation of the policy, including the definition of under-used or unviable land and young first time buyers.
We will also work with developers, lenders, and local authorities on the development of further supporting technical material.
In addition to this policy change, the Government will seek to amend the community infrastructure levy regulations in the next Parliament to exempt discounted starter home developments from the levy. We will also consider further how the development of more starter homes can be encouraged through further planning reforms, including the opportunity to use other forms of land.
This written ministerial statement sets out agreed coalition Government policy to deliver a national starter homes scheme and planning policy; it is separate from the announcement by the Prime Minister today setting out further Conservative policy intentions on starter homes for the next Parliament.
Beware the EU’s Energy Union
O n 25th February the Commission issued a Communication entitled ” A framework strategy for a resilient energy union with a forward looking climate change policy.” It is remarkable for the scope of its ambition, allied to the absence of detail on where the huge sums of money will come from to pay for all the investments and research the EU wishes to see.
The Energy Union has five main characteristics.
The first is “Security, solidarity and trust”, which is the EU’s way of presenting its intention to take over the strategic direction of energy policy in each member state, and to integrate each state’s energy and energy policy into an EU wide system under their control. The EU wishes to take over negotiating supplies of energy from outside the EU. “Particular attention will be paid to updating the strategic partnership on energy with Ukraine”. They wish to cut dependence on Russian gas (crucial for 6 member states at the moment) by saving energy, by switching more to non fossil fuels, and by importing more US gas and worldwide LNG.
The second is a fully integrated internal energy market. They wish to establish EU regulatory control over electricity, and ensure at least 10% of a country’s power is governed by interconnector arrangements to other EU states. They wish to integrate the transmission and computer systems.
The third is energy efficiency improvements to cut demand. They wish to “promote the use of road charging schemes” to cut private road transport and wish to electrify both trains and cars.They wish to decarbonise energy as their fourth aim, with a target of a 40% reduction in CO2 by 2030 compared to 1990. They wish to increase renewables further, and biofuels.
They fifthly want a union for research and innovation. Co-ordination and working together is designed to produce smart grids, demand reducing consumers, better homes, and electric transport.
Nowhere does this document give us any figures on how the mighty costs of this programme will be financed. There is mention of a large investment programme which they hope the private sector will undertake. There is little mention of the current very high costs of EU energy, other than to tell us EU gas prices are more than twice those in the US. There is just the hope that we will get better at renewables so they will become cheaper. There is no comment on how the massive Euro 120bn of current subsidies to energy will be eliminated.
The EU’s energy policy is its second worst EU disaster after the Euro. It is hostile to business, it is deindustralising much of the EU, and unfriendly to consumers. This document will make it worse.
Why did the IMF lend so much to Greece?
In 2010 the IMF lent Euro 30 billion to Greece as part of a much larger package to support the ailing economy. The IMF explained at the time that it had lent 3200% of quota, well over its normal limits for a country in difficulty. It gave Greece “exceptional access to IMF resources”. The IMF cited the need to prevent the crisis spreading to other parts of the EU and to defend the Euro.
It is an extraordinary tale of bad decisions and policy that a first world country with many advantages in the world should end up a pensioner of the IMF, and should need such unusual treatment, getting far more in loans than very poor countries that are more normal recipients of IMF money and policy advice. The IMF recognised that Greece had both a severe fiscal problem (spending too much) and a competitiveness problem (not selling enough abroad to pay the bills). The IMF opined that in the Euro Greece needed to cut wage costs to tackle the latter and needed to cut spending. The IMF did not think a debt write down was needed, as it thought the running deficit was the main issue. It looked forward to a recovery in the Greek economy from 2012, after the cuts had depressed the economy in 2010-11.
In 2012 the IMF decided to lend Greece a new Euro 28bn as part of a replacement loan package. It drew attention this time to a “significant large competitiveness gap” (stronger language than 2010) and to a high level of public debt. This time it agreed with a major write down of privately held Greek public sector debt ( (75% written off) and required cuts in the Minimum wage as part of its measures to improve competitiveness. Once again Greece received special treatment with a large loan. I queried why the IMF would do this for a country which is no longer sovereign in monetary and economic matters, as its status with the Euro prevents a normal IMF recovery package.
So what will the IMF do and say now that Greece once again has asked for help? Why is Greece still locked into a competitiveness problem and a fiscal deficit problem? Why hasn’t the economy grown as the IMF once predicted? Why hasn’t Greece been able to see her way out of the trap the IMF identified in 2010 by following IMF policies?
It looks as if IMF programmes need a state to be able to keep its own banking system liquid by creating money, and need it to be able to devalue as part of the changes to offset the public spending cuts. Greece is unable to do this. It seems that the IMF was dragged into lending to a Eurozone member for political reasons, when it should have stayed out. The IMF would not lend to a UK County or to a state in the USA if they were in need of loans. The IMF would tell that government to seek cash from the domestic authorities. So why then does the IMF lend to Greece, when it is not a sovereign state and needs to look to the rest of the Eurozone and to the ECB for help? How will the IMF now get its money back? When will it explain the failure of its recovery policy for Greece?
Why austerity policies may not work in the Eurozone
The Eurozone’s disciplines have been nicknamed the politics of austerity for good reason. Each state is meant to keep its budget deficit down to 3% of GDP – way below the large cyclical deficits the UK, US and other single currency areas allowed themselves in the great recession. Each state is meant to keep its total amount of borrowing to below 60%, though most of them have given up on that idea. No individual state can print more money, make its economy more liquid or devalue to provide a private sector stimulus. As a result when a Eurozone state cuts public spending it is likely to lead to a fall in GDP which the private sector struggles to offset or does not offset at all.
We have seen that cutting the growth rate of public spending substantially in the UK after 2010, and in the US cutting national defence spending and State level spending, did not lead to a fall in GDP. The private sector responded well to extra money being put into the system, to the gradual rebuilding of the banks and the spread of some more private credit, and to the available spare resources caused by the great recession. Both countries experienced a recovery despite or because of the action taken to control public sector budgets. Both benefitted from the continued low interest rates, made possible in part by growing control of state borrowing. In the UK real public spending did edge up a little as well. I was criticised recently for quoting deficit reduction as a percentage of GDP rather than in cash terms. As I have often pointed out, the fall was bigger as a percentage of GDP, smaller in cash terms. I used this version on Thursday because I was dealing with those who said budget cuts would lead to another recession, and they always use the figures which show the biggest “cuts”
In contrast, the much harsher budget cuts in Greece have added to the collapse in GDP in that country. Greece today has a national income and output 22% below its peak in 2007. It is amazing that the policies which have created this disaster have been allowed to continue for so long. Even now the Greeks have voted in a government which rightly points out how damaging the policies have been, there cannot be much change as that same government bizarrely wishes to stay in the Euro, the origin of much of their trouble.
The enormous Greek recession has gravely reduced tax revenues. As a result there have to be most severe cuts in public spending to try to get the deficit down to the tough target levels – in Greece’s case even tougher owing to the debt covenants. The private sector so far has been unable to pick up the very considerable slack. owing to weak banks. Greece has no power to create more money, no power to lower its own interest rates further, no power to devalue to price itself back into more world markets. As a result they have experienced the misery of sliding from public sector cuts to less private sector demand, and from less tax revenue to more public sector cuts.
If you wish to see a true austerity policy then look at Greece. They have had major cuts in public spending, major cash reductions in wages and salaries, major job losses, and mass unemployment. Many businesses have closed. Any sensible person is against the kind of austerity policy inflicted on the Greek people. Unfortunately it just seems to go with being in the Euro.
Clever politics may be bad government on student loans
It was inevitable that this very political Labour party would want to expose the student loan issue to offer maximum embarrassment to the Liberal democrats in the run up to the election. Sure enough on cue and probably on schedule- after leaks alleging delays – Labour yesterday launched its price cut for university courses, cutting the student payment from £9000 a year to £6000 a year from September 2016.
The prime aim of the launch seemed to be to remind left of centre voters that Lib Dems had promised to get rid of tuition fees, a prominent and oft repeated pledge before the election in 2010, only for a Lib Dem Secretary of State to dream up and push through a scheme which did the opposite. I am told it is called punching the bruise in modern political strategist and spin doctor circles.
What matters to most people is not what it does to the relative votes for the Lib Dems and Labour, but what it would do for our country, our students and taxpayers, in the years ahead were Labour to be given the power to do it. The first in the frame to express doubts are the universities. They like the certainty of getting the payments from the students. They will immediately lose a third of their UK student revenue. They will have to rely on government grant to make up the shortfall, and are worried in case that gets squeezed in later years.
The second group to complain will be those who have to pay the extra bills. Labour will need to spell out more of the detail of how it gets £3bn extra tax out of people saving for their retirement. Whilst they claim it will only hit people on high incomes, it may be they do not get anything like as much extra tax out of that group as they hope. Will they then spread the pensions tax lower down the income scale? Are they happy to be deterring people from pensions saving?
The third group who find the new policy does not help them very much are the groups Labour says it wishes to help – students from low income backgrounds and students who obtain lower income jobs after graduating. The first group is already helped by various scholarship and bursary schemes. The second group do not have to start paying interest or making repayments on their loans until their income is high enough to allow that.
Labour’s left wing critics point out that the winners from the scheme are the graduates who do get into better paid jobs, who will have to repay less capital and pay less interest on their debts as a result of cut. Some are already dubbing it a policy to help future hedge fund managers and City high fliers. The Labour response is they do wish to raise the interest rate people have to pay on their loans if they earn more than £42,000. That sounds complicated. To make such people worse off or no better off they will need to raise the interest rate on the loans by at least 50% to avoid the richer and more successful graduates benefitting.
Will it be worth all that hassle? Can we really believe Labour’s figures on all that extra tax from a few highly paid pension savers? Is this really the best use of the money? To me it looks like clever politics makes bad government.
Reply on aid to India
A number of people have written to me saying that as India has said it no longer wants overseas aid from us, and as it is now a substantial power with a growing economy, we should discontinue our aid programme. I have received the following letter from the Secretary of State confirming that action has been taken to end official aid programmes:
“As you will know, in November 2012, I announced that the UK would end its programme of financial grant aid to India by the end of 2015. Our new development partnership would instead be based on technical assistance programmes, focused on sharing skills and expertise; and investments in private sector projects focused on helping the poor.
I am writing to update you on progress as we enter the final year of this transition which is well underway. No new financial grant aid to Government budgets has been approved since 2012, and we have been responsibly winding down our existing financial grant aid programmes. All financial grant aid to Government will finish by the end of 2015. The UK can be rightly proud of what we have achieved in recent years – for example, by 2015 we will have reached 3.6 million pregnant women and children under five with nutrition programmes, given access to improved sanitation to almost 2 million people, provided access to finance to over 3 million poor women and provided clean energy to 600,000 people.
After 2015, our development partnership will focus exclusively on technical assistance and investing in private sector pro-poor projects which have the potential for both development and commercial returns. As I set out in 2012, this strategy is based on a rigorous analysis of the drivers of inclusive growth and economic development in India. All technical assistance will be transformational, based on the best of what the UK has to offer, and contribute to wider UK-India bilateral and prosperity priorities. Programmes will also make use of returnable capital to unlock and demonstrate the potential of private sector led growth.
This new partnership will draw on skills and experience across the Government and UK institutions, working with UK Trade and Investment, the Department for Energy and Climate Change, the Foreign and Commonwealth Office, HM Treasury, HM Revenue and Customs, and the Departments for Business Innovation & Skills, Education and Health.
India is an increasingly important partner for the UK and a central player on issues like climate, trade and global economic stability and security. The transition I announced in 2012 has set us well on the way to a modern development partnership for the 21st Century, moving us away from a donor-recipient relationship to a strategic partnership of equals based on policy cooperation, investment and trade.
JUSTINE GREENING”
Austerity policies
Yesterday I gave a lecture at Reading University. I asked the question, does austerity work as an economic policy? Why do the IMF and the Euro area favour austerity programmes for countries in trouble? Do they succeed in rescuing countries by these means?
Austerity is a wide ranging word, not a precise term of economics. It has come to mean in recent debates the idea that a country in debt with a large deficit should cut spending and raise taxes in order to reduce its deficit. This has led to passionate debates about the wisdom and the impact of such a course of action.
In the UK between 2009 and 2013 the main parties all agreed the deficit was too large and needed to be brought down. All agreed if left unchecked the deficit could lead to crisis interest rates, an unaffordable cost of interest on a burgeoning public debt, and an eventual squeeze as the debt grew out of control. We could see the damage unchecked deficits caused in countries like Greece or Venezuela. There was nonetheless a tough argument with Labour saying the coalition wished to cut the deficit too far and too fast, whilst the coalition said it needed to speed up the pace of deficit reduction it had inherited as the financial situation was grave.
We now know the outcome of these policies. Labour’s prediction of rising unemployment, a dip into a new recession, and more personal misery as a result proved to be untrue. Instead the UK economy has grown over the four years of deficit reduction so far, employment has grown rapidly and unemployment has fallen. The deficit has been cut, though not by as much as planned as tax revenues have fallen short of budget.
Labour never answered my questions of 2010 and 2011 as to how the US economy was recovering so well when the US was cutting its deficit more rapidly than the UK. Since the worst year at the end of the last decade the USA has brought its deficit down from over 10% to 2.5% of GDP. This deficit reduction has included some big cuts in states spending and defence spending. The US economy has grown well every year this decade, contrary to predictions that austerity policies stop growth.The UK deficit has been brought down from a peak of over 11% of GDP to 5% of GDP, a bit less than the USA.
The economic records of the USA and UK in recent years show us that bringing deficits down does not necessarily stop growth. Indeed, some of the deficit reduction occurs thanks to growth, which raises revenues. Growth however, does not automatically follow from cuts to public spending. There need to be other policies towards banks, money and private investment to ensure success with a strong private sector led recovery. In a future posting I will look at some of the harder cases of extreme austerity in the Euro area, where damage has been done by the policies pursued.
Visit to St Mary’s primary, Mortimer
I visited St Mary’s Mortimer at their request on Monday morning before going to Parliament for the votes on Criminal Justice and abortion. The School asked me to talk to the older children about Parliament and government, as they are studying rules and governments at the moment.
The children asked a wide range of questions about how political parties work, how many MPs there are, what is good and bad about being an MP, whether I had met the Prime Minister, what I could do to change things and why people become MPs.