A week in politics

The objective was clear. To unite the party to the prospect of a full term coalition, to illustrate that the pain would be shared by all and to blunt any momentum by Labour’s ‘New Generat-on’. Where did it all go wrong? Well where didn’t it?
The prospect of middle class parents being deprived of their child benefit drew a storm from the predictable outlets of the Telegraph and Mail. The fact that the threshold was almost twice that of the current household income seems to have passed some by. A progressive tax system must seek to reward entrepreneurship, provide a safety netting for those less well off, but encourage those less well off to achieve greater things. I can’t see where a middle class tax benefit falls into this category.

The case for the defence is a poor one. Not a day goes by without the favoured outlets being briefed by Fox or Osborne’s men. Our defence procurement has been a shambles for decades. Last generation equipment being ready for next generation battles. The opportunity to reduce the time from conception to implementation should be grasped with both hands, as per the opportunity to actually increase the proportion of fighting men (and women) in the army. It seems that what is needed is not yet another outdated strategic review but a root and branch reform of the MoD.

Alan Johnson’s appointment is an interesting one. To mollify the Davidians, a stalking horse for the Balls-Cooper puppet show? Johnson is a heavyweight but is not in his element and will have little time to adjust and hurt the coalition when the spending review is unveiled. An opportunity missed by Labour.


George Osborne’s Conservative Conference Speech

As GO took to the stage, he left a dramatic 3 second pause to start. Was he lost for words? Would these words have any substance?

Our politicians are obsessed with the past as a slate to wipe our mistakes and Osborne’s speech started with the ‘failures’ of the current government as a checklist. But the use of statistics merely serves to illustrate that one can read, not that one has the cognitive skills to analyse the issues, design a strategy and implement a successful solution. This speech was directed to the party faithful and the biggest unscripted cheer was a reduction of quango specialists second guessing locally elected officials. I’ll believe that when I see it. The Conservatives invented this tactic in the eighties to counter free spending Labour councils.

But we wanted a message to the nation. The Shadow Chancellor reiterated policy statements made over the last year: a reduction in MPs numbers, a 5% cut in MPs pay, a pay ceiling equivalent to the PM’s salary, loss of child trusts to middle income families, retention of the 50% tax rate but nothing new and no tangible theme. There was no reference to the raising of VAT and this will come. Perhaps the fiscal task we face is too onerous to have an economic dream, but once the Augean stables have been cleansed, where is the ideology?

Osborne is often described as a lightweight (amongst many comments, some borne out of inverse class snobbery).  His detractors will have found little to add here in these 33 minutes but nor would his supporters.

Public Sector Pay Freeze

The Labour government’s spoiler declaration today was another pathetic attempt at gesture politics. If you truly wanted to make a gesture then 1) Freeze all public sector pay between £30,000 and £100,000; 2) All pay at or above.would be slashed by 10%. 3) All public sector bodies would be instructed to cut their contractor pay rates by 15%.
Schools, hospitals and social workers to name but a few pay large of their budget to contract workers. This must be addressed for both short and long term reasons.

Conservative Party Conference Week

As the conference kicks off, the Tories will seek to place an emphasis today on welfare. However the Fourth Estate are not interested. They want blood and gore over Europe. DC’s Faustian pact with the europhobes was always going to backfire but what a time to do so. Cameron needs to stick it to the Neanderthals and say “It is power on my terms, or no power”. The Conservatives will emerge from the May election the strongest party but a hung parliament is in the balance if the Continent is allowed to dictate the discussion.

Tory Banks Policy

Abolish the FSA, Transfer powers to the BofE is the synopsis.

DC introduces Tory Bank Policy White Paper
DC introduces Tory Bank Policy White Paper

There is no doubt that the tripartite system failed. Too many macro decisions fell in the gaps in between and the idea of panic in the air over the three week period was palpable. The idea of a financial policy committee is a good macro decisioning tool and its position within the BofE seems a sensible one.

Overall, the Tory Bank Policy looks stable, however the devil will be in the detail. I would like to see an explanation of what the Treasury’s role in this will be in the future. Outsourcing financial overseeing should not lead to a dereliction of duty by the government of the day.

The Dirty Tricks have started


Clearly Mr Coulson, former NOW editor, now the Conservative Party communications director, is being smeared by association. This story has been around for some time but is being released now (by the left wing Guardian Newspaper), to disrupt the Conservative Party. Expect more stories ‘breaking’ about senior members of the Tories as we approach the election. Should there be enough instant damage then GB would call an October election. But I doubt this will happen, a drip feed through to a May 2010 election is more likely, as Labour cross their fingers and hope desperately for some for of evidence of ‘green shoots’.

UK Public Spending – a business viewpoint

I am at the excellent Global Leader Summit being hosted by London Business School.

Among the many interesting topics is a discussion on the down turn and its perceived length. It’s clear through overt discussions that the UK public finances are being seen as a key (if not the key) to future growth. Jeremy Darroch of Sky in particular pointed to the extent which the UK public sector permeates the UK economy (a point which is almost saturation in some geographical areas). This view was expanded by Paul Polman of Unilever who also pointed to the need for increased saving by the consumers.

Public Spending is a tightrope which must be tightened but if pulled too tight will kill off any greenshoots of recovery (illusory or otherwise). It is therefore with regret that our government have sought to use the uncertain economic climate as an excuse for ‘smoke and mirrors’ speeches and not firm figures.

May 2018
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