We live under the tyranny of the Bank of England and OBR. Politicians have given powers away to these so called independent bodies, only to discover they are unable to make accurate forecasts whilst recommending policies which lurch us from high inflation to no growth. Many of the electorate take the more traditional view that Ministers are elected to sift the advice and make good decisions. If inflation is too high or growth is too low voters blame the government. As we approach the next election voters face the problem that the main Opposition party thinks the problems of inflation and growth require more powers to be surrendered to the very bodies that have caused much of the bad outcomes so far. Why take more of the same medicine when it has proved to be harmful so far?

Over my time as an MP to date  the record of the Bank of England has been poor for much of that period. The Bank along with the Treasury, the CBI and the Labour party nagged the Conservative government of the 1980s into the European Exchange Rate Mechanism. All the time I was Margaret Thatcher’s economic adviser we stayed out of this system, which was obviously going to be destabilising and damaging as I set out in a booklet before the event. When they had their way it gave us first a rapid inflation as the Bank created money to try to keep the exchange rate down to the limits of the scheme, and then caused a deep recession when they had to arrest the inflation with an intense money squeeze to try to save the pound. That wrote off the period 1988- 94 and ended the Conservative government.

In the period 2005-8 the Bank allowed a massive expansion of credit as the Treasury went for an increase of spending and borrowing at the same time. The Conservative Opposition warned the government that this was dangerous and inflationary. So it proved. Then the Bank did the opposite and squeezed money and credit too hard, threatening the solvency of the banks. I warned against such an extreme lurch, but they were determined. Only when some of  the largest banks in  the land were teetering on the edge of collapse did they relent. They had to undertake a very expensive bail out of leading banks brought on by their own folly. As Gordon Brown was an important influence on the thinking behind decisions he ultimately had to take it was fitting Labour were thrown out of office for the big crash of 2008.

In the response to the covid lockdowns the Bank understandably made a  large amount of money available to prop bond markets and offset some of the damaging economic consequences of widespread closures. Unfortunately the Bank continued with this policy throughout 2021, recovery year, in a way that was bound to be inflationary. So it proved. Now they are trying to overcorrect by taking large losses on bonds they paid too much for and reducing  the money supply.

What a pity the experts of the Bank have not yet learned from these dreadful boom/bust swings that creating too much money or allowing too much credit is inflationary, and allowing too little brings on a  recession. This is a clear case where expertise needs to be challenged, and experts with better forecasting records should be listened to more.

Many people who accept the science of climate change do not buy electric cars and heat  pumps because they do not see how that lowers CO 2. The establishment and the main parties all hold the same strange idea that forcing more people to buy these two products will in some way cut world CO 2. It is difficult to see how this would happen given current limits on renewable power.

If I bought a new electric car today and plugged it in to charge it the grid would need to call up more gas fuelled electricity to handle the needs of my recharger. We are usually using all the renewable power we can produce. If I spent a lot of money on a heat pump that too would require grid power to fuel it. How does it make sense to burn the gas in a distant power station and lose some of the energy in transmission when I could burn the gas directly in my home boiler and capture more of that energy as usable heat?

For the establishment view to  work we need much more renewable power to power the grid, with reliable ways of storing green electricity for days and times when the wind is not blowing and the sun is not shining. We are someway off that situation. Before demanding we switch cars and heating systems government and the energy industry need to decide how to make storing renewable power economic. There would then be a long period of gaining permissions and implementing the work necessary to put in extra renewable capacity, extra grid capacity, and the approved ways of storing. These might be the production of green hydrogen with all the additional changes that would then require, or more large battery installations, or more pump storage systems. None of this is easy to do, quick to complete or cheap.

There also needs to be whole lifetime accounting. Ripping out a gas boiler and putting in a heat  pump uses large amounts of energy to make or scrap or install or remove the products. Much of the work  today is undertaken by suppliers using fossil fuels . This CO 2 needs to be accounted for. Early retirement of gas boilers or petrol cars may add to world CO 2 from the CO 2 involved in their replacement. It has been shown you would need to do a high mileage for a number of years in an electric car, recharging it from renewable sources, to cut overall CO 2 compared to running your older petrol car for longer.

The Horizon scandal is a good extreme case of what can go wrong when too many Ministers and MPs accept official advice and believe experts, only to discover later that the official advice and expertise is badly wrong and doing grave harm.

I am all in favour of expertise. If I was ill I would seek advice from a doctor as they know so much more than I about diseases and health problems. I would also be aware of the need to ask what the side effects of treatment might be and  what the record of success has been if treatment was proposed as ultimately I would have to make the decision about what to do.

Valuing experts does not mean that experts are always right. Indeed, in the areas I know best where I have some expertise of my own I am well aware of the divergence of opinions amongst the experts. This makes a Minister’s job both very interesting and very challenging. Advisers advise and Ministers decide. Sometimes a Minister needs to ask for a second opinion or a different expert view. Good Ministers are generalists but they have a sense of when the expertise is well based and when it could let them down. Good Ministers also wish to achieve good results for the public they serve. That too can demand changing experts to get a better answer.

I and a few other MPs, impressed by the work of  James Arbuthnot, asked questions about Horizon from early days of the problems emerging. We all knew good honest local PO managers and could not believe some of them were accused of fraud and false accounting. As we realised the numbers involved I asked how senior managers of the Post Office and senior officials in the sponsor department could think there was suddenly a big outbreak of fraud around the same time as a new accounting system was introduced. It was also strange that no evidence came forward of these alleged fraudsters suddenly having bloated bank accounts or stuffed wallets of their own, going on a  spending spree from the profits of crime.

It was frustrating that so many senior officials and Ministers stuck to the Post Office line.  In future blogs I will look at other very worrying examples of where establishment thinking based on errant expertise is doing damage. As readers will know, I have been challenging establishment thinking over inflation, growth, reductions of CO 2, energy policy and migration amongst others. When people say they want change in the way we are governed, they are often seeking change in the controlling theories and policy prescriptions. When all the main parties accept the same expertise which turns out to be wrong democracy is damaged.

I reproduce below the most recent of my interventions on the Post Office Horizon disaster. Others can also be found going back for a decade by searching the website. I have consistently argued that it was exceedingly unlikely that there was a sudden outbreak of mass criminality by respected Post Office managers at the same time as a new computing system was brought in. I have urged the Post Office to reconsider, to apologise and to pay prompt and generous compensation to those it wrongfully prosecuted. It is dreadful it took them so long to own up to their mistakes. 

Post Office compensation

DECEMBER 16, 2021 50 COMMENTS

I am glad the government has now signed off on a compensation scheme for Post Office managers wrongly accused and badly treated by the Post Office over the introduction of the Horizon computer system. Some were made to pay large sums to the Post Office they did not owe and some were falsely accused…

Some compensation at last for Post Office managers

SEPTEMBER 19, 2023 31 COMMENTS

I reproduce below a letter from the Minister about compensation for those caught up in the Horizon software problems. I have been pressing for a long time for proper compensation.   Dear Colleagues, Post Office Horizon Compensation I know that colleagues will welcome an update on compensation for postmasters who were wrongfully convicted on…

Post office: Compensation Payments for Postmasters with Overturned criminal convictions

DECEMBER 14, 2021 1 COMMENT

I have received the enclosed update from Minister for Small Business, Consumers & Labour Markets about compensation Payments for Postmasters with Overturned criminal convictions. Dear Colleagues, I know members across the House are aware of the longstanding Horizon issues whereby postmasters were prosecuted and convicted on the basis of Horizon evidence that we now…

Compensation for Postal Managers

DECEMBER 9, 2022 39 COMMENTS

I have pursued the issue of compensation for Postal Managers who were wrongly accused when the new computer system failed to account properly for their businesses. The letter beneath gives us the latest update on compensation, where I have urged the government to be generous and get these matters settled:   Dear Colleague, POST…

My support for the Government’s new policy to ensure that the Post Office properly apologises and compensates every post master wrongfully convicted

DECEMBER 15, 2021 0 COMMENTS

Sir John Redwood (Wokingham) (Con): I am grateful to the Minister for changing the policy. I have been a long-standing critic of past Governments and Ministers for not telling the Post Office to apologise and pay up, and I encourage him today to ensure that the Post Office apologises properly, and pays up quickly and generously.  …

Approval of Funds for Full & Final Settlement for Postmasters with Overturned Criminal Convictions

DECEMBER 14, 2021 0 COMMENTS

I have received the enclosed letter regarding the settlement funds for Postmasters: Approval of Funds for Full & Final Settlement for Postmasters with Overturned Criminal Convictions This House is aware of the distressing impact that problems with the Post Office’s Horizon IT system have had on the lives and livelihoods of many postmasters. The…

My Question during the Statement on Post Office Court of Appeal Judgment, 27 April 2021

APRIL 28, 2021 0 COMMENTS

Sir John Redwood (Wokingham) (Con): Will the Minister understand that there has to be compensation, and urgently, and this compensation has to cover not just the Horizon losses but the legal costs and the loss of business and income that people suffered from the damage to their reputation? Many MPs, including myself, told past…

The Post Office systems scandal

APRIL 28, 2021 109 COMMENTS

It has taken many years, much suffering and plenty of legal bills for the Postmasters to get justice over the Horizon scandal. MPs including myself told past Ministers there was no sudden outbreak of mass criminality by Postmasters, but there was a systems and accounting problem created by new computers. This has at last…

Justice for Post Office managers

APRIL 23, 2021 67 COMMENTS

I was pleased to learn that at last the Post Office accepts its accounting software was faulty and led to wrongful accusations and cases against Post Office managers. Various MPs took up these matters without success, as in this 2014 debate to highlight the problem: Post Office Mediation Scheme, 17 December 2014 Mr John…

My question during the Urgent Question on Horizon: Sub-Postmaster Convictions, 10 June 2020

JUNE 11, 2020 1 COMMENT

John Redwood (Wokingham) (Con): Most MPs want the Post Office to apologise to all those it has wronged and pay generous compensation to them in the circumstances. Will the Minister add the Government’s voice to that and make it a demand of the Post Office? The Parliamentary Under-Secretary of State for Business, Energy and…

Electric cars are not selling well to individual buyers. Few people want to buy a heat pump. Green campaigners insist these products are essential to save the planet. They plan further taxes subsidies, regulations and bans to force people to buy things they do not want or cannot afford. To succeed the green revolution needs to be a popular revolution with people wanting its products.

There are various strands to scepticism which Green campaigners need to take seriously. Shouting back at people that they are climate deniers is no way to win them over and is usually wrong. Let us first look at the science.

I know of no one who denies carbon dioxide is a greenhouse gas or who denies manmade carbon dioxide is increasing. Most accept climate  has changed a lot in the past and is likely to carry on changing. The issues many have with the “settled science” include

1. Green scientists do need to explain to the wider audience what caused the warm periods and ice ages before mankind appeared. How will these  same forces which must still be around affect our temperatures going  forward?

2. In historical times before industrialisation and the adoption of coal,oil and gas as prime energy sources  by people what caused global warming and cooling? Could these forces still be around?

3. How does variation in solar intensity, solar flares and other changes in our main light and energy source affect past earth temperatures.? What are the forecasts for sun activity going forward? Will this make us warmer or colder?

4. Why do wind and current  patterns shift? What is the forecast for these going forward, as they can have an important impact on weather in different countries and continents.

5. What is the role of water vapour and what changes are likely in its pattern in future? Water vapour is another very common greenhouse gas.

Future temperature levels will be the result of the interplay of the past natural forces that produced climate change with the manmade additions to  greenhouse gases. To persuade more people to join green campaigns they will need persuasion that manmade CO 2 will be the deciding variable in future temperatures. This is presumably based on the thesis that past natural forces like solar activity and seismic activity will not be dominant forces or that their net impact will be neutral in ways that it was not in previous eras.

I reproduce today the views of an EV car owner sent to me recently. He agreed I could  share this with you. As it reveals this is someone who bought into the green  idea and wanted the EV to work for him. Experience was very disappointing. I have shortened and anonymised it:

 

“Some 5 months ago I was in a position to change my Petrol vehicle (Peugeot 3008) for an electric one. Unfortunately the 3008 has only just been released as a Hybrid and the full EV is not due until later next year (2024). As a result of this I was obliged to go to the E2008 which is a smaller vehicle. Despite this the E2008 was considerably more expensive than the petrol 3008.

 

The cost of a home charger was nearly £1000 extra to have installed. Even the domestic “granny” charger was another £250 to charge at home until a home charger could be installed.

 

I try to have “green thoughts” about the environment where possible and use Solar Panels and have recently installed a Combi Boiler.

 

However after using the Electric car for 5 months I have reverted back to a petrol driven model due to the following reasons.

 

My wife and I had range anxiety. Most manufacturers quote a range of in excess 200 miles. In practice the best I could get was about 150 miles in fair weather. With the recent cold weather I found that range could drop down to as little as 110 miles.

We had to make a number of trips to towns  about 120 miles away  and required a charge on the way home. Of the 5 trips we made we found that none of the high speed type were working, after trying 5 different chargers we finally found a charger which was at a hotel. When we arrived at the hotel the charger was in use and the guy had only just started charging so we knew it would be about an hours wait. Also there is no queueing spaces so we had to double park until the space became free.

 

On our most recent trip away I wanted to use one of the regular chargers only to find there were already 3 cars waiting to use the one charger.  This would have meant waiting up to 3 hours before I could connect.

 

I also had a friend visit from Slovakia and we decided to take her out shopping by car. We knew that it would be risky trying to complete the journey without recharging on the way home. We tried 5 different chargers and found that they were not working.

 

We decided that the only way was to hope for the best and try to get home without the charge and made it home with just 11 miles spare and no reserve having turned off the heater on the way home to save energy.

 

On these occasions we were in contact with the Network Operators who tried to be helpful but could only suggest using low power chargers at supermarkets which could mean a stay of 7 hours, plus the devices have a maximum stay time of 2 to 3 hours without a penalty of £100-150 for an overstay.

(He gave up on the EV )

Unfortunately I lost about 30% in the trade in of my electric vehicle after just 5 months and had to pay a premium of about 20% in buying a 2 year old petrol model.

Reply: This explains why EVs are a hard sell to non fleet buyers. The motor industry has here lost a customer who bought into the idea but was thwarted by the costs of the product and the difficulties of recharging when away from home.

 

I was a fairly lonely voice amongst MPs saying I wanted out of the EU single market as well as out of the EU. I did not want a so called free trade deal with the EU single market on the poor terms Mrs May negotiated . I would have been happy with World trade Organisation most favoured nation terms which  we would have got  automatically without a deal .

I came to this conclusion from my experiences running a major international industrial  group of companies before entering Parliament, and from being the UK’s single market Minister in the run up to the laughingly named completion of the single market in 1992.

My business life taught me a UK major company was not welcome as an investor on the continent, where there remained many barriers to acquisition of an existing business and to greenfield activity. The Group I ran continued to find it easier to invest, sell product and make money in the USA, Australia, and Asian countries  than in France or Germany.

As single market Minister I saw how the so called single market project was a massive power grab.The EU proposed the takeover of regulatory and lawmaking powers in sector after sector. It grew single market competence to cover employment  policy, health and safety, environmental policy, transport and much else. It regulated  to gain control. It usually did so in a prescriptive way, laying down how products must be made to the recipes  of the existing dominant continental companies who influenced the drafting. It was anti innovation and dismissive of small business and the needs of the self employed.

The CEBR has just produced its latest forecasts for world GDP out to 2038. These show that the EU’s share of world GDP has slumped from 33.5% in 2008 to 23.6% today. They expect it to fall to just 19% by 2038.  This should be no surprise as EU growth in the last fifteen years has been very weak. The EU has watched as the US has built seven mighty tec global companies that dominate the digital revolution.The UK needs to break free from EU anti enterprise anti innovation rules and go for new ideas and faster growth.It is good news that the UK now does not have to follow the last three years of yet more EU rules stifling business and markets.The UK needs to speed its own revival with pro growth policies now it is free to do so. It should allow companies to innovate, not tying them down with rules on how to design and make things.

 

There are many other areas where spending can be reduced or better targeted beyond the big ones mentioned yesterday.

As I have often urged the Bank should stop selling bonds at big losses for taxpayers to lay. Hold them to repayment to cut the losses.

There are still monies being sent as overseas aid to successful and or well armed countries with nuclear programmes. Why is still true? Why are we still paying money to the EU several years after leaving? There should be a push back on their calculations and interpretations of the Withdrawal  Agreement.

Who does the UK spend so much on highly speculative technologies for decarbonisation? These can be developed by the private sector or led by other states with more need to decarbonise than us where they are clearly not yet commercial.

Why does the UK have a high tax and subsidy model when it comes to energy? The UK ‘s very high carbon and energy taxes loses us industry here and with it costs us tax revenue. Industries like steel that cannot afford our high energy costs and taxes then need substantial subsidy payments to keep some of the industry .Cut the taxes and end spending on the subsidies.

“Pour me another,  lets toast the new year
Here’s to a better, put  fizz in our cheer”

Tonight’s  not for sorrows, nor mulling old wounds
Come banish our troubles,  lets sing some new tunes

Caught in the present is a moment to choose
To look forwards or backwards, to win or to lose

If your comfort is  clinging to all that has past
This precious moment of hope will never last

Grasping  the future and its  unknown way
Can bring success and many a wonderful day

The past is well trodden,  we know the ending
The future is for moulding, shaping, bending

As last year expires,  hopes and promises broken
Change things this time , leave pledges unspoken

So pour me another, drink to the new year

Here’s to a better, put fizz in our cheer

If your life is a drama  you can change the plot
If your friends are the  actors you can recast the lot

If people around you are holding you back
Tell them you’re changing, to a new track

Lets hold on to clichés that drive us to more
Lets venture out from  behind that closed door

We can stretch for the stars and strive for the sun
We can soar with  the wind making life more fun

You are only out of the game  when you give up the play
So write some new words so you have a new  say

Aim for something better, embrace the best
You may fall short of target  but gain from the quest

So cast off the old. Live a new dream
Grab the future foretold. Mine a new seam

So pour me another, lets toast the new year
Here’s to a better, put fizz in our cheer

Trust that  tomorrow can be better than today
Let the future  empower us with its  new way

Lets cast off from austerity, from all those extra  taxes

Lets go for growth as austerity relaxes

Lets make our own minds up and set our own pace

The future is only ours, my friend, if it we  embrace

Tonight is the night is to put on a new face

 

So pour me another, lets toast the new year

Here’s to a better, put fizz in our cheer.

 

The main reason we are running a large deficit is the public sector is spending too much. Controlling spending better is important to get the deficit down, to allow more tax cuts and promote more growth. There are four main areas where less can and should be spent.

1. Public sector administration and civil service numbers.  Between fourth quarter 2019 and third quarter 2023 civil service numbers have increased by 69,000 and other public administration by 41,000 making a total rise of 110,000. The total is now 1,175,000. Productivity has slumped during this period of rapid additional recruitment. There has also been substantial grade creep with many more senior and higher paid people in the mix. The civil service is too keen on additional regulation, more international obligations and more meddling with people’s lives and business activities. Do less of it.
2. The high costs of making provision for large  numbers of low paid economic migrants. Whilst this may be cheap labour for companies it is dear for taxpayers. Every additional 250,000 need a new city the size of Southampton to live in. That means many new homes, schools. surgeries, more utility capacity of all kinds. At an estimated £250,000 each of public sector capital and early years revenue spending 100,000  new additional  migrants cost £25bn.
3. The high welfare costs of many more people registering as unable to work. Whilst it is important we have a generous system for those disabled who cannot manage a job, it is difficult to believe so many more people each year are being added to this category. With more support and better benefit administration more could get suitable work.
4. Local government wasteful spending. In so many places as in Wokingham local Councils are spending so much money on narrowing roads, making unhelpful changes to road junctions, and  introducing cycle lanes where no-one uses them as part of their anti driver policies. Many Councils have been adding to property and other investment portfolios at foolish prices and finding in some cases they cannot rent them out at a rent that delivers any return for taxpayers. Some  Councils have expanded their administrative staff numbers and pushed up pay for  senior personnel.

The government says it wishes to tackle these problems. There are remedies it can put in place for 2024 to start to make a difference  and bring the growth rate in public spending under better control.

1. Place an immediate ban on additional external recruitment of personnel for the civil service and other public administration. If an additional person from outside is needed a special case should  be signed off by a Minister. As people leave to change jobs or to retire so the departmental organisation chart should remove some jobs and amalgamate others. There should be some better  control over the ratio of senior staff to the rest.
2. Implement the plans to cut legal migration by 300,000 and step them up to reduce it by more. The aim should be to get it below 2019 levels as promised in the Manifesto. As it comes down so the large budgets for extra public sector housing and services can be reduced.
3. The government is proposing extensive further welfare reforms to help more people back into work. This needs speeding up as the numbers who cannot work again continue to surge.
4. Put tougher controls on local authorities borrowing to buy assets and make investments. Central government should decline to fund anti driver schemes.