Today is the day for the voters to speak through their votes. I will not be posting about the UK today, until after the polls have closed.

Labour should know all about austerity. They plunged the UK private sector into the most severe austerity by their large mistakes in 2007-9. Not content with fuelling an irresponsible boom in credit in 2003-7, they decided to make the worse error of stopping it all so abruptly that they brought down several banks. They threw the UK economy into the worst recession since the 1930s. Many people lost their jobs. Incomes were squeezed. Businesses failed or became unprofitable. That’s austerity.

The Coalition have made a start to reversing Labour’s cruel austerity. Many more people are now in jobs, with unemployment down. UK output and incomes overall are now back above the 2007 level before the crash. Living standards are rising again after the sharp fall in 2007-9 and the squeeze thereafter.

Many commentators think austerity is a new word for public expenditure cuts. They need to realise that the bulk of jobs in the UK are in the private sector. 26 million people work for employers other than the state. It was this large majority that felt the full pain of the cuts. Public expenditure in real terms carried on rising in the Labour years, and rose again by a small amount in real terms under the Coalition. There were individual cuts in particular departments and programmes, but no overall reduction.

I am a strong critic of austerity. I opposed Labour’s credit binge and mega bank mergers on the way up before the crash, and I opposed Labour’s clumsy bank regulation and nationalisation which made the crash more intense and cast a long shadow over the recovery.

I want the current economic recovery to continue. To speed it we need tax cuts, not higher taxes. To fuel it we need policies that are positive for business and enterprise, not hostile to success. It was ill judged regulation from the state that brought the banks to their knees and damaged the private sector. It will be allowing people more freedom to set up and grow companies which will power the recovery.

The UK is close to the point now where the commercial banks can finance a recovery without further artificial public sector stimulus. Pursuing more anti bank rhetoric would not be a good idea. Whilst many people may  not like banks, if you damage the banks you damage the rest of the economy. What Labour does not seem to have learnt from its bitter experiences of 2007-9 is if you get the banks wrong, it is other people in many other sectors and businesses that lose their jobs or struggle to maintain their commercial activities. Sometimes politicians have to stand up for the unpopular, and explain to people why the politics of jealousy or revenge may make things worse, not better.

On this main part of the site anyone wishing to name individual seats or candidates has to supply a full list of candidates in that seat and comply with election rules. I am deleting all posts that do not conform.

 

Energy policy is Cinderella who should come to the election ball. A combination of EU policy and UK policy first established by Mr Miliband’s legislation leaves the UK with dear energy, and with greater uncertainty over supply. They have encouraged undue dependence on wind energy, and have closed too many power stations that burned fossil fuels. The next government needs to accelerate the new build of power stations. A wise government will cut our dependence on wind energy.

Conservatives have pledged to build no more onshore wind farms with subsidies. Labour, the Lib Dems and Greens wish to press on with more subsidised wind farms. To do so will just make our energy dearer, and less reliable. We will need to build more back up power for the days when the wind does not blow. That backup power will need to be very heavily subsidised, as no-one will build a modern efficient gas or coal station if they are not allowed to run it when the wind blows.

Green enthusiasts reckoned fossil fuel prices would go up, making the extra cost of wind energy less oppressive over time. Instead, fossil fuel prices have just halved, making wind energy so much dearer relatively. This problem means less jobs, less industry and poorer families. It means exporting activities to countries with cheaper energy, not burning less for the world as a whole. It is a foolish policy. I want the election to discuss it, and for voters to vote against all candidates who are pledged to dear energy, more de-industrialisation, and  more fuel poverty.

The Conservatives have seen the choice for the election as a simple one. Do you want the Conservative team to continue, who have presided over a decent recovery, with 2 million new jobs and now rising real incomes? Or do you want to hand the keys back to the people who crashed the car in the first place? Labour in its last period in government put up unemployment and brought down real incomes with a jolt.

Labour sees the election as being about the NHS, as we discussed before. Drawn into the economy, Labour has now pledged to get the deficit down, though by less than the Conservatives. Labour has pledged to avoid tax rises for most people, and has been imprecise about their public spending plans. Conservatives have been very clear about the overall pattern of spending, tax revenue and borrowing for each year of the next Parliament, but have not published details of how the extra cash public spending they are proposing  is divided between departments.

The polls show either a Conservative government or a Labour minority  with SNP support on a vote by vote basis. The SNP say they wish to end austerity, which they say means they wish to spend a bit more than Labour’s plans, and therefore borrow a bit more, whilst still gradually bringing down the deficit.

So there will be a difference- Conservatives will borrow less and get the finances on a stable and sustainable footing earlier.

The bigger difference will come in the attitudes towards enterprise and the private sector. More than 25 million people work in the UK private sector, more than five times as many as work in the public sector. The left of centre parties all see the private sector as needing more price controls, regulations, taxes and even state control and ownership. They have a range of policies to limit rents in housing, to control energy prices, to increase state control of the railways, to tax the banks more, to tax property and homes more, to tax foreign residents more and above all to tax anyone who is financially successful more.

This approach was tried by Mr Hollande in France, with very poor results. The French economy lost talent and money, the economy stayed depressed when the UK’s grew well, and in the end Mr Hollande had to moderate some of his ideas.

The choice on May 7th is between a policy which is delivering growth, more jobs and rising living standards, and a series of measures which however well intentioned will make the outlook worse.

 

Labour has proposed a number of interventions to control prices in the energy sector, for housing rents and certain kinds of lending. Such controls usually reduce supply and end up damaging those they are trying to help.

Everyone agrees the General election is no re run of the Scottish vote on independence. Even the SNP are making it clear they want a mandate to negotiate the best possible settlement for Scotland whilst still being within the UK. On this basis current polls show them attracting some voters who voted against Independence last autumn. It is unlikely Welsh nationalism will make much impact. The majority of Northern Irish MPs are likely to  be elected as unionists.

This does not mean the issue of the future of the UK is off the agenda, or that the next Parliament makes little difference. The next Parliament, it is true, is bound by its predecessor to honour the promises made to Scotland by all three main Westminster parties. These promises are likely to be interpreted in a pro devolution direction by the new SNP MPs who will probably be elected in some strength and may be the third largest party. In contrast the next Parliament is not bound by its predecessor to solve the English problem. Mr Hague as Leader of the House would not  put the matter of EVEN, English votes for English needs, to the vote, as Lib Dems said they would vote with Labour against the scheme.  The new Parliament has a blank sheet to resolve the question of England.

Many in the  SNP accept the justice of England’s case, but their party will doubtless bargain against it in any way they think will help their cause. The Lib Dems have some complex scheme based on votes in the UK Parliament for England calculated by some notional proportional representation, which is unlikely to get support from the  two main parties in the Commons. Labour wants to fob England off with devolution to cities and maybe counties, having no answer to the question why can Scotland chose her own income tax rate but England cannot chose hers? Conservatives have a version of English votes for English issues, which is a start to tackling the problem of England.

The Lib Dems and Labour want to delay justice for England as well as denying it. They favour a long and detailed Constitutional Convention to examine devolution for England, whilst hurrying through more devolution for Scotland with no such consideration. Conservatives wish to press on with proposals for England, after years of examination and thought which has gone into them.

The future of our union will be very affected by what the next Parliament does. As it legislates for Scotland, it is vital it understands the mood in England. Only one party seems to understand the need to do something soon for England. There will be a big difference between a Conservative led government and a Labour led one on the question of England.

One of the most significant differences between the  four main parties (parties likely to win more than 10 seats) is the approach to the European Union. The three left of centre parties all support our current membership, would be happy to see a continuing erosion of power as the EU passes more laws and gains more control over our lives, and are happy to pay a substantial contribution to the rest of the EU. The Conservatives argue that the current relationship is not working in the UK’s interest, that too much power has already passed to the EU, and we need a new relationship with them.

A Conservative government would recognise that the Euro area members of the EU will need to take more and more power to the centre, to add political, fiscal and budgetary union to their currency union. The UK has no wish to do that, and needs a new relationship with the Euro area as it emerges in a more centralised form. A Conservative government will seek to negotiate a new relationship based on trade and political co-operation. As Mr Cameron made clear in his Bloomberg speech, a central task will be to restore UK democratic accountability of government to Parliament. Voters will then have a referendum to decide if they like the new relationship or would rather leave the EU altogether. Those who are sceptical of the UK’s ability to negotiate a new deal without leaving, will be free to vote for Out. The presence of the referendum will provide a good incentive to the rest of the EU to negotiate, as very clearly they do not wish to lose all that money we pay in.

The other three parties would fail to address the real issues which are already upon us over our membership. As non members of the Euro we are finding that regulation and control of our large financial services and banking sector is increasingly under EU law and administration  in ways which can be damaging to business. We are finding it impossible to run a low priced energy policy thanks to EU energy rules, making  our wish to expand UK manufacturing more difficult to deliver. The EU wants the UK to stand behind the debts of the banks and states of the Euro area. We need to resist this. Any likely government  but a Conservative one will not stand up for UK interests, and will not seek to resolve the growing tensions between Euro and non Euro members.

This election will make a huge difference on the matter of our EU membership. There is only one chance now to vote for an In/Out referendum before many more EU shackles are placed upon us if we have a government formed from the 3 pro EU left of centre parties.

 

This week I am going to write a series of articles on what differences there might be depending on who governs after May 7th. The main media concentrates on the spin lines from the major parties, which tend to hype  differences. They follow the daily diet of mistakes, gaffes and set ups which characterise a modern media driven election. Some of these should not matter and are usually trivial and of no lasting significance. My objection to David Miliband was not that he once carried a banana, which many others have done with no harm to their reputations. My objection was his uncritical love of the EU. My objection to Gordon Brown was not his unfortunate facial expressions when waiting for an interview in a studio when tired, but the way his banking and economic policies put us into the most violent boom/bust cycle since the 1930s. These articles will ask what difference will there really be? What matters?

Labour have sought to put the NHS at the centre of this election. They mean by that health in England. This General election will make no difference to the way the NHS is run in Wales or Scotland, where it is a devolved matter under their Assembly or Parliament.

Labour claim the NHS is only safe in their hands. There are no grounds whatsoever to take this view. The management of NHS England say it will need an extra £8billion a year by the end of the next Parliament. The Conservatives and Liberal Democrats have both promised to find this. Labour has promised less, but I assume were they to be in office they would also find the money. The UK bureaucracy is usually good at extracting money for public budgets, and will doubtless make a strong case. It seems unlikely that there will be a lot of difference on total NHS England spending between the parties.

Labour say they will stop people making money in the private sector out of the NHS. They do not of course mean this in most cases. It was Labour who set up a lot of the most expensive PFI schemes when in office, encouraging the private sector to profit from providing new NHS facilities. They will not be able to get out of these. Any government will have to buy drugs and medical supplies from with profit companies. All will stick with the system that most GPs are private sector contractors to the NHS. The NHS has always been a mixed economy system, a partnership between leading pharmaceutical and medical supply companies, doctors under contract, and directly owned hospitals with state employed staff. No main party is proposing any change to this pattern.

Labour dictates the terms of the debate on health. This debate prevents discussion of reform or change. This has been a very conservative election on health, with all main parties competing to keep it as it is, with more money.

Conservatives have promised to recruit more GPs to offer longer opening hours and week-end service. This would help relieve pressure on A and E if more people could get an appointment with their GP to deal with the things that do not need hospital treatment. That would be a practical change to offer a better service to patients, and to save money at A and E departments. I conclude there would be little difference to the NHS whoever wins, but Conservatives do have an attractive policy of improving access to GP services which I think could be a beneficial change. It has also taken a Conservative Secretary of State in the coalition government to expose the problems in some hospitals properly that had occurred under Labour, and to get improvements.

 

 

As Labour left office in 2010 there were 2.5 million people out of work . There were 1.5 million claiming Job Seekers Allowance.  Today there are 1.84 million out of work, and 770,000 claiming Job Seekers Allowance. Employment has risen from 28.8 million to more than 31 million.

Most people now know the UK economy has created an additional 2 million jobs over the last five years. Fewer know that many of these jobs are full time, and many  of them have been taken by UK citizens who were out of work or just joining the workforce from school and college. The fact that people on Jobseekers Allowance  has almost halved is good news.

The figures are also a reminder that more needs to be done to help more of the remaining people who are  out of work into employment.

If we compare the UK with other countries in Europe, we can see that the UK has been one of the best performers, alongside Germany. The table beneath shows the problems in most of the larger EU countries, and in Greece, the worst performer:

Unemployment rate

Greece        26%

Spain         23.2%

Portugal    14.1%

Italy          12.2%

France      10.6%

UK             5.6%

 

Employment rate

Greece         49.6%

Italy              56.0%

Spain            56.8%

Portugal       63.0%

France          64.1%

UK                73.3%

Labour’s great banking crash and recession has tested political debate to destruction. Politicians,  parties and most in the media are happiest talking about a few billion of spending. To most people a billion is a lot of money, without having any precise feel as to how much. It is a lot of money, but it is also  just fifteen pounds each for every man, woman and child in the country. It is not a significant sum when discussing the UK economy. It is a small rounding error in the national accounts.

In this election the biggest annual sum argued over has been the £8 billion extra for the NHS. It hasn’t  been much of an argument anyway, as Lib Dems and Conservatives say they will pay it, and Labour in office would end up paying it. The largest individual sum is the misleading £100 billion   for Trident which is some kind of lifetime cost. On a similar time frame the NHS would  be  say £3000 billion. The actual cost of four new submarines would be around one quarter of that, spread over a number of years of building.

Yet as I have set out we are talking in theory of annual public spending of  £737 billion , rising to  £797 billion over the next Parliament on Conservative plans. There is little discussion of whether these are the right totals, and whether we get value for all that.

More importantly, the UK Parliament proved incapable of having good debates about the far more important large numbers which determined our economic crash in the 2005-10 Parliament or the progress to recover from it  in the last Parliament. The £375 billion of QE was worth more debate and examination than it got. The massive £800 billion of assets and liabilities removed from the balance sheet of the state’s own bank,RBS, was crucial to our economic progress.It was only when there was a change in policy towards RBS in 2013 that the economy started to improve more quickly.  It would be good if in the last days of this election campaign there could be some discussion of the big numbers that have a real impact, as well as debate over  the nice to have smaller sums that are important to particular programmes but do not have much impact on the economy as a whole.