Uk politics

Saturday

Peter Hoskin

Why not just scrap ID cards, then?

From our UK edition

So the protracted, wheezing death of ID cards continues, with Alistair Darling admitting in today's Telegraph that: "Most of the expenditure is on biometric passports which you and I are going to require shortly to get into the US. Do we need to go further than that? Well, probably not." The government are letting it be known that this doesn't contradict their existing policy, but their shifting rhetoric remains striking.  Last year, we had the then Home Secretary, Jacqui Smith, proposing that British citizens should be able to choose between a card and a biometric passport.  Earlier this year, Alan Johnson said that ID cards wouldn't be compulsory for British nationals, after all.

Friday

Fraser Nelson

Blair admits to misleading the British public over Iraq

From our UK edition

It has taken eight years, but Tony Blair has finally leveled with the British public and admitted that the WMD thing didn’t really matter: he wanted to depose Saddam Hussein anyway. That's what he has said in a BBC interview, presumably to pre-empt his appearance before the Chilcot inquiry. His chosen confessor: Fern Britton. His medium: BBC1 on Sunday. It has been trailed to the newspapers, including tomorrow’s Times. As it says: "He said it was the 'threat' that Saddam presented to the region that was uppermost in his mind. The development of weapons of mass destruction was one aspect of that threat. Mr Blair said that there had been 12 years of the United Nations going 'to and fro' on the subject, and he noted that Saddam had used chemical weapons on his own people.

Daniel Korski

Not Foxy enough

From our UK edition

Analysts analyse, reporters report and politicians, well, they are meant to make decisions. When in power, they are meant to decide things; when in opposition they are meant to set our alternatives to government policy. But not, it seems, when it comes to defence policy. Or at least not always. I have just sat down to read Liam Fox’s NATO speech (as I could not attend), which he gave at Chatham House recently. To say that I am disappointed is an understatement. I think Liam Fox is a first-rate politician. His ongoing exposure of the Government’s military under-resourcing has been excellent. On a Tory team that is sometime accused of lacking stand-out talent, he is a national politician with clear views, consistency and a large following.

Peter Hoskin

The Tories dust off their baseball bats

From our UK edition

Is it just me, or have the Tories developed a slightly harder edge in the couple of days since the Pre-Budget Report?  We had an unusually acidic address from David Cameron yesterday, in which he likened Brown 'n' Darling to "joy-riders in a car smashing up the neighbourhood," and criticised the PBR for its "irresponsibility, basic deceit and complete lack of moral principle".  There have been a couple of quite powerful attack posters from CCHQ.  And now we've got George Osborne saying that Brown may have "betrayed the responsibilities of the office he holds." "So what?" you say, "they're the Opposition – it's their job to oppose."  Well, yes, of course.  But that opposition seems to have been concentrated over the past few days.

Peter Hoskin

Committee overload

From our UK edition

We all know how bureaucratic and convoluted a lot of Parliamentary practice is, but this reminder from Heather Brooke of the bodies involved in reforming MPs' pay and expenses is still pretty astonishing: "Currently we have: the senior salaries review body (which makes recommendations on MPs' salaries and pensions); the committee on standards and privileges (appointed by the House of Commons to decide on complaints against individual MPs reported to them by the parliamentary commissioner for standards – currently John Lyon); the committee on standards in public life (which deals with complaints about unethical conduct among MPs – the current chair is Sir Christopher Kelly); the members allowances committee (made up of MPs who advise the members estimate committee on the rule.

Peter Hoskin

Why class wars don’t work

From our UK edition

Well, it seems like Paul Richards – a former aide to Hazel Blears – wants to corner the market in quietly persuasive demolitions of his own party's strategy.  If you remember, he wrote a perceptive piece on Labour's shortcomings in the aftermath of the Norwich North by-election, which we highlighted here on Coffee House.  And, today, he's at it again, with a very readable article in PR Week on why the class war won't work.  His three reasons why are worth noting down: "First, it is hypocritical. The Labour Party has a disproportionately far higher number of former public schoolboys and schoolgirls in parliament and in the government than a random sample of the public they serve.

James Forsyth

How far could Boris go?

From our UK edition

At Tory conference a bunch of candidates got together for supper. The conversation turned, as it so often does on these occasions, to who might be the next leader. One candidate was advancing the case for Boris with some gusto, until another interrupted saying, ‘can you imagine Boris representing Britain at the Security Council.’ The table agreed that they couldn’t and so the conversation moved on. Certainly, this perceived lack of seriousness will be Boris’s biggest problem in going further than Mayor of London. Cameron had a point when he said that Boris was stuck in a buffoonish rut from which he would find it hard to escape. But if Boris can win re-election he will have enough of time to establish a record which demonstrates a certain level of competence.

Peter Hoskin

The unravelling continues apace

From our UK edition

Has Brown got away with his horror Budget?  Reading the Populus poll in this morning's Times, you might be tempted to say he has.  Sure, there's some bad news in there for the government: trust in Dave 'n' George's ability to manage the economy has hit an all-time high, and only 12 percent of respondents think that the measures outlined in the PBR will be sufficient to deal with our country's fiscal woes.  But Labour types will also seize on those numbers which show quite high levels of support for the individual proposals annouced on Wednesday.  78 percent back the bonus tax.  61 percent back the capping of public sector pay increases.  And – surprisingly, to my mind – 51 percent back the national insurance increase.

Thursday

Fraser Nelson

Gordon Brown’s one and only legacy

From our UK edition

I will sign off tonight with this sickening graph from the earlier IFS presentation – showing the extent to which Gordon Brown’s economic incompetence has transformed the public finances for a generation. Servicing this debt will absorb money that would otherwise be spent creating jobs, lifting people out of poverty, advancing education, promoting prosperity. The leading article in the magazine this week finishes with these words, which came to mind when I saw the above graph: “It will be no surprise if UK public debt has been downgraded by the election; if so, a gilt buyers’ strike will become more than a theoretical possibility. The new government will face a Sisyphian financial task, so formidable as to make almost every other issue of the day look trivial.

Fraser Nelson

Those hidden cuts in full

From our UK edition

The truth about the Pre-Budget Report was revealed today by the Institute for Fiscal Studies: the new National Insurance tax will hit everyone on £14k or over, not £20k - and there are implied 19 per cent cuts of some £40 billion in the “non-protected” areas. The event was sold out, because it now has the reputation as the only place you learn the truth about Budgets passed by this government. Yet again, Gemma Tetlow from the IFS has unearthed the cuts which the Chancellor felt he had to conceal from the public (and – unwittingly, I hope - lied about this morning on the radio).

Peter Hoskin

At least Gordo and Sarko are still friends…

From our UK edition

If you're looking for some sort of light relief after yesterday's horror-PBR, then can I recommend the joint article by Gordon Brown and Nicolas Sarkozy in today's Wall Street Journal.  Yep, the two men have put their recent spat behind them, and have cemented their relationship by huddling over a typewriter and bashing out just under 900 words on global financial regulation.  The Entente Cordiale never looked so strong.    Beyond the display of unity, it seems the article's purpose is to convince the City that the EU's French finance commissioner won't blunt our competitive edge.

Peter Hoskin

The cuts unveiled

From our UK edition

Well, as expected, the IFS have put the lie to Darling's claim that the budgets of non-ringfenced departments would be "pretty much flat".  Here's how Nick Robinson reports it: "The Institute for Fiscal Studies says that government plans imply £36bn of cuts in departmental spending ie over 19% from 2011-2014 in order to protect schools, hospitals and increase overseas aid. They say the police pledge is meaningless. They also say that defence, higher education, transport and housing are most likely to be hit.   The cost of paying back the debt over the next eight years is equivalent to £2,400 per family in taxes or cuts over that period." UPDATE: The relevant IFS presentation has now been uploaded on their website – you can read it here.

James Forsyth

An expensive piece of spin

From our UK edition

Labour briefed out its plan to tax banks that pay bonuses so extensively that everyone in the City knew it was coming. The result is that a slew of banks paid their bonuses out early. Small, private banks that aren’t encumbered by bureaucracy moved to award their bonuses early as soon as these stories started appearing in the papers. The legislation says that the moment when the tax is awarded is when the tax applies, so if a bank awarded its bonuses as late as Monday — when the details of this plan were all over the papers — they avoided the charge. As one City accountant who works with these banks told me, ‘If anyone didn’t do it, they’re a bit silly.

Mark Bathgate

The markets’ verdict on the PBR

From our UK edition

The press didn’t like Darling’s budget – and neither do the markets. What Darling didn’t say yesterday is that the Treasury is looking to borrow £243 billion from the City by the end of the financial year – this info was slipped out by the debt management office (link here). Brother, can you spare a quarter of a trillion quid? The markets are not sure they can. Gilts are being hammered today - biggest single day sell off for some time - 13bps so far this morning on 10yr gilts. They now stand at 63bps above German bunds, the widest since the crisis started. On another measure, Credit Default Swaps, the UK is being hit hard again. It now costs $85,000 to insure $10 million of UK debt against default – against just $24,000 for German debt.

Peter Hoskin

The Darling deception

From our UK edition

Alistair Darling normally strikes us as an honest man dropped into an impossible situation. But whether he misspoke, or whether he set out to mislead, he told a lie on the Today Programme this morning which needs to be highlighted. So what was it?  That non-ringfenced departmental budgets would remain "pretty much flat" rather than receiving significant, if not sufficient, cuts.  As Fraser demonstrated yesterday, there were spending cuts hidden in the Budget   and we'll see the full extent of those as soon as the IFS processes the numbers later today.  Last time around, after April's Budget, they calculated cuts of 7 percent across three years.  Thanks to a few more ringfenced budgets here and there, those cuts could even be deeper this time around.

Peter Hoskin

Last orders in the last chance saloon?

From our UK edition

It's the set of headlines which Labour must have dreaded after their recent progress in the polls.  The Times: "The axeman dithereth ... but the taxman cometh".  The Guardian: "Darling soaks the rich ... and the rest of us too".  The Mail: "The Buck Passer's Budget".  And so on and so on.  It doesn't look too good inside the papers either.  The FT rails against a  "lack of clarity on public spending plans", while the Independent says that "rarely has a pre-Budget report promised so much and delivered so little".  The Sun's opposition may not be too surprising, but it's there in bucketfuls: "Britain is staring into the abyss. After yesterday's performance that abyss has got deeper.

Wednesday

James Forsyth

Has Labour u-turned on protecting defence spending?

From our UK edition

Back in July, Lord Mandelson added defence to health and education as an area of spending that Labour would protect from cuts. But looking at page 97 of the Green Book, defence is conspicuously absent from the list of areas of public spending that are protected in 2011-2012 and 2012-2013. The only areas mentioned are NHS spending, schools, sure start, policing and overseas aid. As some of these are only receiving funding increases in line with inflation, it seems reasonable to assume that everything else - including defence - is likely to be cut in real terms.    (There is a commitment to spend up to £2.5 billion from the reserve on the mission in Afghanistan in 2009-10. But this will not add to the baseline of the MOD budget.

James Forsyth

An unhealthy dependence

From our UK edition

Few columnists are read more carefully in Conservative circles than Danny Finkelstein. He is extremely well connected in the Cameron circle and enjoys something of a mind-meld with George Osborne. Danny’s column today is the argument for sticking to the modernising message. It does, though, contain one significant criticism of the party, its dependence on David Cameron.   This Cameron dependence has been a problem for a while. But the leadership itself must take most of the blame for this. They have used Cameron for almost every announcement that they view as important and that has sent a message to the media that if it doesn’t come from Cameron the party doesn’t view it as important.

Fraser Nelson

The end of spending

From our UK edition

So Alistair Darling today repeated the same trick he used in April’s Budget – referring only to rising “current spending”, so as to hide the full extent of Labour’s spending cuts. Current spending is only one component of total spending, and when you add in some of the other components – as we have done in the table below – the cuts become clearer. The table shows that next year is the last year of any real rise in spending. From 2011, spending either falls or flattens out. But the cuts will be even deeper than the table reveals.  This “total spending” figure is all we could work out from the appendices in today’s Pre-Budget Report – but, alas, it doesn’t account for debt repayments or unemployment benefits.

Andrew Haldenby

What to do if you can’t tax or borrow out of trouble

From our UK edition

Today one Finance Minister in the British Isles cut spending, cut borrowing by 1 per cent of GDP compared to his last Budget and cut the national debt by 5 per cent.  It wasn’t Alistair Darling. Brian Lenihan cut Irish public spending by 7 per cent (equivalent to a £40 billion cut in the UK).  He cut the public sector headcount, pay, pensions for new entrants and unemployment and child benefits. Alistair Darling postponed the inevitable reckoning on the finances until the pre-election Budget, the post-election Budget or a currency or debt crisis if that comes first.  Brian Lenihan gave us the flavour of what that reckoning will be and how it will be argued.