I find it strange that three Heads of Security Agencies had to speak out for fear that Brexit would damage exchanges of information between France, Germany and the UK after Brexit. Why should it? They would have to want to change their current procedures, or their governments would have to stop instructing them to make sensible exchange.

It is already the case that if the UK gets intelligence about a threat to lives in France it will tell the French authorities and vice versa. There are data sharing agreements, based on what we can usually share with due consideration of how each Intelligence service protects its own sources. The UK belongs to the Five Eyes grouping of the USA, UK, Australia, New Zealand and Canada where trust is even stronger and the sharing has gone further, and that will clearly continue after Brexit.

This seems to me to be another non problem, unless the EU side wants to make it a problem. As we have high quality and extensive intelligence it is unlikely they will want to reduce the flow of information, so they can just agree to carry on. The information share is usually bilateral anyway. Issues in the UK should be adjudicated by our court, and issues on the continent by their court.

An Extradition Agreement might be a better route for bringing suspects to trial in another country rather than trying to continue with the Arrest Warrant, where ECJ jurisdiction would be a problem.

Last week I was asked some questions at a meeting based on wildly inaccurate information about myself and my views. I was told the basis for the questions came from Wikipedia so I looked up my entry.

I understand it is not the done thing to correct your own entry, so instead for greater accuracy I will record here where the entry is factually inaccurate, and also where it is particularly misleading.

Factual errors

I am not currently the co chairman of the Conservative Party Policy Review on Competitiveness. That job ended in 2010.
I do not act as the Leave means Leave pressure group spokesman
I am not Corporate Affairs Adviser at Concentric PLC
I have not been non executive chairman of Mabey Securities this decade
I completed and received a D Phil – not a PHD – at All Souls College, Oxford, not at St Anthony’s
I was elected to a fellowship by examination at All Souls in 1972 which led on later to a Distinguished fellowship.
I did not write an investment column “recommending investors pull their money out of the UK”

Misleading impressions

I have never spoken or written against civil partnerships and gay marriage and am not proposing any change to current laws. I regard the debate about capital punishment as being over and do not support its reintroduction. I never spoke or wrote in its favour.

Next Tuesday I have been invited to give a lecture in the Speaker’s House at Westminster on the opportunities Brexit affords the UK. I have plenty of ideas of what can be better, and believe the UK can both be freer and more prosperous once we are out of the EU. That was why I campaigned and voted for just such an outcome. I will share more of the details with you on this site next week.

My vision will include discussing how to spend all the money we save from our contributions, which will boost both our growth rate and our balance of payments. It will look at opportunities to remove taxes we do not agree with but have to impose as part of our membership. It will examine the scope for a fishing and farming policy which is better for our farmers and fishermen, and will cut our dependence on imports. It will consider what a new migration and borders policy ought to look like, and set out how we can pursue a free trade agenda that will be good for jobs in the UK. There is a longer list than this, but these are some of the highlights.

I would be interested to hear from readers what they think we can do after Brexit that will improve our lives and government, given the freedoms we will gain to vary our laws and spend our own money. We have had months and months of being told by a small group of contributors here – and another small group of contributors to the national media – what they think the downsides will be. Most of these will prove as incorrect as the forecast of a recession immediately after the referendum vote.

The IMF was one of several international bodies and opinion formers who wanted the UK to stay in the EU. They misjudged that call, misunderstanding UK voters. Now they have issued an update report telling us that we have to take strong policy action to succeed. Their remedy is to abolish the regular increases in the state retirement pension which they think is too generous, and to put through a series of tax increases. They want to hike VAT on heating fuel from 5% to 20%, and to put up taxes on the self employed.

What a bizarre and negative mix. Why do they recommend this? Because they say our state debt to GDP is too high, yet it is very similar to the USA and below the levels in Japan, France, Austria, Italy and some other advanced countries. They fail to recognise that the state has bought in a substantial part of the debt they claim to be worried about.

It is difficult to see how taxing the self employed more would help innovation and economic flexibility. It would hit one of the flourishing areas of UK growth. Nor is it easy to see why pushing more people on low incomes into fuel poverty through a massive tax hike on domestic fuel would be a good idea. Nor does removing spending power from pensioners help promote a faster growing economy. This ticket would never win a UK election, and proves again UK voters are more sensible than the IMF.

The IMF does not even seem to be good at forecasting the UK economy. They were too gloomy about the likely short term impact of the vote. They now make much of the slightly slower rate of growth in 2017 compared to 2016, and blame Brexit. If they analysed the figures better they would see growth speeded up a bit after the Brexit vote, and started to slow in 2017 thanks to action to slow the economy taken by their friends at the Bank of England! The Bank has put up rates, sought to tighten car loans and consumer credit, stopped QE and is now withdrawing special lines of credit to the commercial banks. At the same time the European Central Bank has kept interest rates at zero, has printed a lot more money and has not restrained bank credit.

So could we have a bit more analysis and a bit less policy prescription? Oh, and they do condemn UK educational standards at the same time. No mention of the world class universities in the global top ten.

We know that the Foreign Secretary’s speech today was checked and approved by 10 Downing Street, and is a statement of government policy.

It is clear from the text that it remains government policy that we will leave the EU, the Customs Union and the single market in accordance with the Article 50 letter and Act, and the EU Withdrawal Bill.
It is also clear from the text that the UK will regain control of its laws and regulations, and will take the powers necessary to amend and improve the law codes once out as we see fit.

This should come as no surprise to all those who have followed the votes in the Commons on the Bill or who have read the PM’s two speeches on this topic. It will nonetheless come as a surprise to those who have been writing that the government is about to reinvent the or a customs union, forego an independent trade policy, and accept the need to follow all new EU laws.

The speech does not offer us any guidance on whether we need and will accept a so called Transition period, or on whether we will agree to a substantial payment to the EU on departure. I assume the speech is silent on these matters because nothing is agreed until everything is agreed, and much has not even been discussed so far. I still see no need for a transition or for payments all the time nothing good is offered that we will transit to.

It is misleading to say we can nationalise the railways and this will solve all their problems. The bulk of the assets are already nationalised through Network Rail. The state owns all the tracks, signals, most of the stations, trackside assets and the land the railway uses. The main reason for the high cost of rail fares and the high taxpayer subsidy is the high cost of providing the large infrastructure the railway requires, and maintaining and improving it.

Quite often the reasons for failures of service rest with the performance of Network Rail. The wrong kind of snow or leaves on the track, signal failure, bent rails, failure of station equipment are regular reasons why trains are late or cancelled.

The private sector part of the railway on most lines is the provision and operation of trains that use the railway. These too can lead to delays and cancellations. If you hear staff are on strike, or a train driver has failed to turn up, or the engine breaks down, that is the private sector part letting you down.

The private sector is very circumscribed now in what it can and cannot change on the railway. It has to run a timetable laid down by government. It is often unable to get train slots on the tracks to expand or vary its service. Many fares are controlled. It can change the catering and on board train offer, but does not control the arrangements for ticketing, waiting on stations and the general service provided for passengers when not on board.

Some parts of the private sector have failed to reach good agreements with their staff to ensure smooth running of the trains. Is there any reason to suppose if the workforce was nationalised it would be any easier to reach an agreement to use the Guards for customer support? Nationalised industries had poor records when it came to employee relations. Labour’s In place of strife approach when in government failed, and Labour lost in 1979 following bruising public sector strikes.

There is plenty of scope to apply new technology to the railways to improve service and raise productivity. As there is also plenty of scope to grow usage of the trains, there is no need for redundancies. The present mixed model is struggling to bring about the changes that are needed. A fully nationalised model, on the evidence of past experience, would fare even worse.

UK inflation was unchanged in January compared to December.
Housing made the largest contribution to the annual rise of 2.7% (CPIH) at 0.52%. This includes the impact of higher water, electricity and gas bills and the Council Tax. Motor fuel made the second largest contribution at 0.43% reflecting the further dollar rise in oil prices partially offset by the strength of the pound against the dollar. The third highest contributor was recreation and culture at 0.41%. These are domestic charges for entry to events and places of interest. These three items accounted for one half of the rise.

Other commentators may tell you motor fuel contributed to a fall and recreation contributed to the rise, as they compare the rate of increase this January with the rate the preceding January. This however can be misleading, as what matters most is the actual contributions of each item to the total in the month in question.

Those commentators who keep telling us the inflation is all to do with a fall in sterling should be asked why they hold this view when the three largest contributions had nothing to do with sterling, or in one case benefitted from a rise in sterling against the dollar in recent months.

Labour wants to change the current boundaries between public and private provision of public services.

They have to accept that the bulk of public service will continue to be supplied by the private sector, as they acknowledge they cannot buy up all business in the UK to provide everything from the public sector. Bread and circuses would remain privately supplied were there to be a future Labour government as they always have been.

The two most sensitive battlegrounds where they wish to change things are health and railways. It is important to understand where the current boundaries are. These are boundaries agreed by both the previous Labour governments and the current Conservative government.

In the case of health, the private sector makes and supplies all the drugs. Most GPs are private sector contractors of the NHS, some with private practises as well and many with for profit pharmacies alongside. Most pharmacies are for profit private sector businesses, dispensing over the counter medicines.

Many hospitals use private sector cleaners, caterers, computer service providers and other suppliers from the private sector. Labour introduced the idea of buying in operations from the private sector where they were good or where the NHS lacked capacity.

The public sector owns and runs most of the hospitals, but not the surgeries. It provides many of the operations, and pays for most of the care however delivered.

What do you think about these current boundaries? Are there bits which you think should be done entirely in house in public sector owned assets with public sector staff? What parts of current private sector healthcare would you want a government to nationalise?

Should GPs be made to be salaried NHS employees? Should surgeries be bought up by the state? Should all pharmacies be public sector businesses?

The Shadow Chancellor has come up with new economic doctrine. Apparently if you borrow money to pay for something this means it does not have a cost to you. He accepts that were a Labour government to be elected, it could nationalise say the water industry by offering government bonds to the current shareholders. The good news about this is he does recognise that in a free society and democracy the state does have to offer compensation or a price to asset owners, if it wishes to acquire their asset. The bad news is he thinks issuing government bonds to acquire the shares means taxpayers do not pay!

There are good reasons why advanced democracies do not usually elect governments that say they will confiscate assets held by private owners. Whilst in the first round of any such policy it might prove popular with those who benefit from the confiscation, the second round effects are very negative for many. Investors will be put off buying and building assets in the UK if they think a government might simply steal them. Anyone living in the Uk with savings or a pension fund will be very unhappy, because they are likely to hold some shares in the utilities or large companies the state wishes to confiscate. So one cheer for the Shadow Chancellor that he sees it would be a very bad policy to say the state will simply take companies and assets over without payment.

The idea that offering shareholders a bond in return for their shares must mean for it to work that the state would pay fair levels of compensation. The shareholders will only accept the bond as compensation if it is at a realistic level, and if the bond can immediately be converted into cash, as many may not want to hold the bond. They may wish to sell the bond on to someone else. Whichever way you look at it, the government will be in effect paying cash for the shares they buy, and borrowing all the money. That means taxpayers have two big bills to face. They have the annual interest bill on the debt incurred to buy the shares, and the repayment of the bond in due course when the entire cost of the shares falls due. This will mean higher taxes to meet these bills.

Labour may argue that they will enjoy the benefits of the profits of the companies they buy, which they hope will cover the interest cost of the bonds. Here, if we look at history, we see that unfortunately many nationalised industries in the past did not earn enough to pay the costs of their capital. There had to be frequent injections of new capital and writes off of old at the expense of the taxpayer. It is difficult to avoid the conclusion that this will be an expensive policy for taxpayers. After all, if Labour also wishes to cut prices and boost wages in these nationalised businesses, that means they will not be making profits.

I find it difficult to believe some in the media are taking these latest economic forecasts for 15 years outside the EU seriously. They have all the hallmarks of the approach that the Treasury used to get the short term forecast for the aftermath of a Brexit vote so hopelessly wrong.

The first thing to stress is the forecasts which state the UK as a whole will lose 2% of GDP if we stay in the single market, 5% if we leave with a trade deal, and 8% if we leave without a trade deal are not saying we will be 2%-8% worse off in 15 years time. This is an estimate of slower growth, not an absolute decline. If we carry on growing on average at 2% per annum over the 15 years we will be 34.6% better off at the end of the period. These forecasts suggest that might only be 32.6% or on a worst case 26.6% better off. The 2% figure over fifteen years is little more than 0.1% per annum, or a rounding error.

The second thing to stress is that to forecast this accurately over 15 years they have to forecast two unknowns – how well would we do if we stayed in the EU, and how well will we do as we are leaving? Why do they assume that staying in is a risk free positive option? What assumptions should they make about tax levels and costs of regulation in the future? Will there be new taxes that hit UK economic activity? Will there be something like the ERM again that triggers a major recession? How much longer will the EU continue austerity policies?

The third thing to point out is there are many more issues which will have a far bigger impact on growth than Brexit. How have they modelled the risks of a Corbyn style government? I do not expect one but over a fifteen year period independent forecasters need to ascribe probabilities to policy changes that are being discussed. What do they assume about the adoption of new technology? What will Artificial Intelligence do to UK professional business services? Will the US still be pursuing pro growth low tax policies in fifteen years time? Will the rolling Euro crisis of 2009-14 reappear and what could that do to growth?

The fourth question to ask is why should there be any loss were we stay in the single market, compared to staying in the single market as an EU member? If, as they seem to think, the single market is the good bit of the EU, surely staying in it means no loss?

The fifth question is why have they not included a good positive gain for the UK from spending our own money at home instead of taking the strain of £12 bn going out across our balance of payments every year to be spent elsewhere? How have they modelled future increased outgoing to the EU if we stayed in?

I could go on, but feel I have asked enough to show why I think these forecasts are a nonsense. Most 15 year forecasts are likely to be wildly wrong. The longer the period of the forecast the more other things can happen that may have a big impact. In fifteen years time we might have a more integrated United States of Europe from the Eurozone, or the zone might have broken up altogether. That will be determined by voters in a range of countries, and by events and markets.