Friday, July 31, 2015

International Relations Committee doesn't exactly meet...

Never let it be said that Party committees move slowly. So, when I received an e-mail last Thursday evening, inviting me to a meeting on Wednesday, I moved swiftly... to open the e-mail (one doesn't want to over-exert oneself...). 

It seemed that I was invited to attend a meeting to discuss the Party's engagement with both ALDE and the Liberal International, both in terms of the forthcoming Congresses (Budapest and Mexico City, respectively) and of our delegations. One of the lesser known effects of our election result is that our entitlement to delegates to each is, how might I put it, somewhat reduced - there is a direct relationship between votes received and representation.

As far as ALDE is concerned, we lose nine of our fifteen Council members, and half of our sixty-two Congress delegates, with effect from 1 January 2016. The catch is, we elected eight people to serve a two-year term as Council delegates covering the 2015 and 2016 calendar years. Eight into six doesn't go terribly well. Throw in the delegate slots assigned to the Federal Executive, the Federal Policy Committee, the Chair of the International Relations Committee and the Liberal Democrat European Group, and you've got a real problem.

So, what to do?

I have a personal interest, in that I am one of the eight directly elected members of ALDE Council, and was the fifth elected last year. And, I'd quite like to carry on next year. The initial proposal, that the election be re-run and the top six candidates chosen, had some obvious personal benefits, but it would leave us without the Chair of International Relations Committee, and key dealmaker at international Congresses, Robert Woodthorpe Browne (and he is undoubtedly a class act...).

The counter-argument was that this would exclude those who were ex-officio and might have chosen not to stand for election accordingly. The only catch with that argument was that such individuals would have been presuming that they would be re-elected to the relevant committee and retain their ex-officio roles, which should have been something of a gamble if our internal party democracy is genuine.

I proposed a compromise, arguing that a democratic mandate from Federal Conference should trump any ex-officio rights, especially as there is no firm constitutional basis for the current arrangements, but acknowledging that the Chair of the International Relations Committee must form part of the delegation.

Was this accepted? In truth, I couldn't tell you. I do know though that I have been tasked with producing a formula that will address this problem in future, which will doubtless make me a lot of friends (note, irony alert). My challenge, to ensure that the States are fairly represented, that diversity is reflected in terms of gender and ethnicity (I'll do my best with the other disadvantaged groups) and that the process is as transparent as possible - it might have been fair in the past but it was hardly transparent.

I may be gone for some time... 

Wednesday, July 22, 2015

If Jeremy Corbyn is the answer, what does that say about the relationship between Labour's Parliamentary Party and its ordinary members?

Obviously, I don't have a dog in the increasingly curious fight that is the contest for the Labour Party leadership. Indeed, it isn't important to me who wins, although the views they advance will be of interest in due course. But the emerging fears amongst those within the Labour Party who are stepping forward to condemn Jeremy Corbyn seem to demonstrate something that I've suspected for some time, i.e. that there is a divergence between some senior Labour figures and their membership base.

It doesn't take a genius to spot that, here in Suffolk, most of the buzz is pro-Corbyn. I follow a few leading Labour activists in these parts, and they are fairly, though not ludicrously, left-wing. They believe in redistribution, in the role of the state to support people and in taxing the rich. What I might call, traditional Labour, now I come to think about it. Admittedly, they weren't terribly successful in these parts in May, failing to win the county's two marginal seats - Ipswich and Waveney - but you do know what they believe in.

And, it seems, the Guardian-reading, granola-knitting fraternity appear to be unhappy too. They hate the Conservatives, and see the role of a Labour opposition to, well, oppose the Conservatives. Easy, really.

So, with a leadership contest to get their teeth into, you might expect the four contenders to seek to buff up their appeal to the people with the power, the ordinary party members and tack to the left. Except Liz Kendall, of course.

The Welfare and Reform Bill is an obvious place to start. It is a fairly unpleasant piece of legislation, likely to hurt the poor, the sick and the vulnerable - an obvious Labour cause. And yet, Andy Burnham and Yvette Cooper have, for whatever reason, hedged and trimmed, leaving Jeremy Corbyn as the only one attacking the Government.

If you're an angry, left-wing Labour supporter, determined to fight the evil Tories, you'll want a leader likely to do that. You are, it could be argued, left with only one credible choice.

Yvette, Andy and Liz will argue that they are credible too, and they'd be right. The problem is, the people they are credible with aren't necessarily helpful, because they mostly aren't members of the Labour Party. Supporters, maybe, but not actually members, thus not voters in the selection.

Someone will doubtless tell me that, it's about selecting a candidate who can win and be Prime Minister one day. And yes, that's what you might want in the medium and long term. But, unless you win the selection, your credibility with centrist voters is irrelevant. The dilemma is obvious, but in dwelling on the consequential stuff, three of the four candidates risk conceding the contest to the candidate least likely to be seen as widely credible.

And the apparent groundswell of support for Jeremy Corbyn appears to have come as a complete surprise to people like Margaret Beckett, who called herself a moron for nominating Corbyn in order to ensure that a range of views were heard. It might imply that she doesn't come across ordinary members that much, or that the huge increase in membership has left senior figures struggling to work out who these new members are and what they want.

Might it be that the policy of parachuting bright young things for London into safe seats in the North and Wales has left a gulf between members and MPs? Or is it more fundamental than that? This may not be a good time to get the answers...

Monday, July 20, 2015

Labour placate the Conservative supporting media. For the love of God, why?

I am not a radical. My best friends wouldn't call me a radical. But, for pity's sake, when a piece of legislation is up for debate which will make your supposedly core voters much worse off, people who are likely to have no financial resilience and won't easily be able to make up the proposed loss of income, it seems like a no-brainer to oppose it. 

So, what the hell are the Labour Party doing, proposing to offer up the gesture of an amendment which includes the phrase;
a benefits cap and loans for mortgage interest support are necessary changes to the welfare system
and bemoans the impact of cuts in tax credits in the most hand-wringing way imaginable?

All of the evidence is that the Conservative proposals will make a lot of vulnerable people considerably poorer in the short term, in the hope that, in four years time, they won't be quite as impoverished in four years as they will be next year. Hell, I oppose them, and I'm a middle-class, comfortably off, bureaucrat.

It seems that Labour Party strategy (and I note that many Labour activists are as aghast as I am) is to demonstrate that they are 'fiscally responsible', regardless of how many poor and vulnerable people, many of them in work and therefore not 'skivers' (and I hate that word), will be thrown under the bus as a result.

Yes, we need to do something about the size of the welfare budget. Frankly, I wonder if we haven't gone too far with pensions, guaranteeing as we now do that pensioners will be better off in real terms every year through the triple lock. But even if you think that tax credits are too generous, you need to give those affected some time to adjust their spending, seek more work and make necessary arrangements.

And, in some places, finding additional work will not be that easy. The opportunities are still not there in some parts of the country, and not everywhere is like Mid Suffolk, with its 2.7% unemployment rate.

But who are Labour trying to impress? The right-wing media? George Osborne? Perhaps I ought to explain. They don't want you to win. You could propose the sacrifice of the first-born from migrant families and they would still rather have a Conservative government. Instead, you have to at least make sure that those who have put so much faith in you for so many generations have someone to stand up for them.

I am proud that Liberal Democrats will be voting against the proposals this evening. I am pleased that they will be standing together with the SNP, the Greens, Plaid Cymru and even the Democratic Unionists. I hope that Labour MPs will join them, defying a whip which deserves ridicule.

As a Liberal Democrat, I sat by over five years, watching our MPs cast votes that I truly wish they hadn't had to cast. Coalition is like that - you get some of your stuff, and they get some of theirs. And, if there are more of them than there are of you, they get more than you do.

But if you aren't bound by a coalition agreement, why for the love of God would you put party discipline above the views of your own members? Is it that gaining power is more important than remembering why you wanted it in the first place?

I pity Labour Party activists this evening, I really do...

Friday, July 17, 2015

FoI review - a lack of information shalt make you free? Hancock abuses the concept of cross-party

The announcement by Cabinet Office Minister, Matthew Hancock, of a review in to the way Freedom of Information policy currently works is just another sign that the Conservatives would much prefer to be left alone in peace to run the country.

But, what would be almost amusing if it wasn't so important is the cynicism of his approach. It would not have surprised me to see a review panel stuffed with Conservative sympathisers - after all, it is highly unlikely that they will have launched this unless they have a pretty good idea as to their preferred outcome. That would at least make it obvious where the thinking is coming from, and the resultant report could be judged in the context of Party policy.

No, it's a cross-party panel, whereby Matthew has picked members of other parties whose views are, how might I put it, somewhat controversial amongst their own ranks.

Jack Straw has never really believed that the public deserve an insight into the workings of government. An authoritarian to his fingertips, he has never had any qualms about throwing our human rights, and those of people from other countries, 'under the bus' if it suits his political priorities.

Alex Carlile has what I can only describe as a blind spot when it comes to issues of security. In the past, I have defended him as, for the most part, pretty liberal. However, given that his past activities as the independent security advisor to the Government have generated much outrage amongst Liberal Democrats, his appointment is likely to welcomed with all the enthusiasm of a flying cowpat in a crowded room.

On the other hand, Michael Howard will perform entirely as the Government will wish him to. He is to civil liberties what Herod was to childminding.

There is, somewhat radically, a woman on the panel, Dame Patricia Hodgson, the current chair of Ofcom, and someone likely to play a role in the future supervision of the BBC, another Conservative target. It isn't clear to me what her background is that qualifies her to do this, but if this is intended to be a hatchet job, that probably doesn't matter. She may turn out to be more cover for young Hancock.

And finally, in the chair, that old reliable himself, Terry Burns. If in doubt, he is the establishment's go-to man. He does have some form on Freedom of Information, as in 2007 he indicated in an article in the Financial Times that some information, particularly analysis, supplied to ministers might be better made public. But, you sense, he will do as he is asked, rather than rock the boat.

So, I have some questions for the noble Lord Carlile. Firstly, how do you end up being appointed to the panel, and was there any consultation with the Party leadership before you accepted the invitation? Second, do you believe that it is a genuine cross-party review if your position is likely to be unrepresentative of Liberal Democrat thinking? Thirdly, does the fact that someone like me feels the need to ask such questions not make you wonder whether or not you've done the right thing?

Go on, Alex, prove me wrong...

MP pay - is it really too difficult to read the whole story before engaging outrage mode?

Yes, it seems.

Oh, you want me to say more than that. Right. Ummm... let's see. Wait a minute, it's on the tip of my tongue...

Featured on Liberal Democrat VoiceIn my day job, I spend my time examining all of the available data in order to define any areas of doubt and uncertainty and then, having done so, work out a fair and rational way of dealing with them. It is surprisingly enjoyable, especially as you learn more about human nature and about how people organise, and rationalise, their lives. You get to meet interesting people and get a sense of their worlds.

So, it would be odd if I spent five minutes looking at one particular piece of data, and drew my inferences from it alone, ignoring all of the rest. And yet, people seem perfectly willing to do just that when it comes to politics, politicians, and how our country is run.

Let's take MP salaries as an example. They have been awarded a 9.26% increase in their basic salary by IPSA, the independent arbiter of what an MP should be paid, as well as the rest of their package. 9.26%, or about £7,000, that's an outrage, right? In isolation, it is a lot of money, especially given the pay restraint to be applied to the public sector (and it amazes me the level of ignorance about that too, but that's a different story, for a different day perhaps).

Of course, it isn't the whole story. The personal contribution towards their pension will be increased, and the resettlement allowance for MPs who are not re-elected has been axed and replaced with a rather less generous 'loss of office' allowance only to be paid to MPs who fight their seat and lose - think of it as redundancy money, as paid to a lot of people when they lose their job. And there are other, reasonable reforms such as the abolition of the food subsidy currently payable if the House sits after 7.30 p.m.

The overall additional cost to the taxpayer? Nothing. Nada. Zip. Heavens, even the Civil Service paybill is increasing by 1% per annum.

There are some elements which might be questioned. Why, for example, should it right for future increases to be linked to the growth in average earnings, when the public sector will be pegged to something rather lower than that if the Government's own figures are to be believed?

But that isn't a cause for outrage particularly, especially if future increases are linked to those of average employees. It provides a realistic incentive to spread the benefits of economic growth rather more widely, even if taking the median figure for pay growth might be more credible than the mean.

Unfortunately, most people will read the first sentences of the story and never bother to get to the end. Indeed, attention spans seem so short now that getting to the middle appears unrealistic. It does not augur well for an intellectual renewal if our body politic, does it?...

Thursday, July 16, 2015

We have a new overlord, it seems. Well done Tim, and well done to Norman too...

So, the white smoke has come, and Tim Farron has won by a rather wider margin than his predecessor did eight years ago. I'm pleased that the margin is unquestionable, but also that Norman did as well as he did do. 43.5% is more than respectable, and it means that he has earned the right to be as serious a player in the future of the Party as he wishes to. Given his obvious ability, that can only be to the advantage of the liberal cause.

It is interesting to see the response below the line on the various websites. The irreconcilables are, still, irreconcilable but, frankly, the fact that they see fit to post how disinterested they are rather undermines that apparent stance. There are others who continue to take great delight in attacking the Party for supposedly enabling the Conservatives. I tend to think that the electorate have some responsibiity there too but wonder if these people were listening to the likes of Rachel Reeves on the subject of welfare. Probably not, as that might challenge them to question their own prejudices.

There are, astonishingly, those who consider that a new leader offers the best hope for social democracy in this country. I do hope not, as I'm a liberal.

And finally, there are those who believe that we should all just give up and go home. Bearing in mind that they aren't liberals and apparently have no interest in hearing an alternative voice, we can safely ignore them.

No, there are millions of people in this country who, if given a reason to vote Liberal Democrat, will do so happily. Will they agree with us on everything? Probably not, after all, even party members disagree amongst themselves - it's part of the liberal DNA. It's our job to make the case of liberal democracy, do it well and rebuild trust again.

So, Tim, good luck. From the snippets of your speech this evening that I've seen, you came across as suspiciously human, and that's a damned good thing. We will probably disagree from time to time, and that's healthy, but if you can inspire the sort of respect that has appeared in my Twitter feed this evening from a surprisingly wide range of people, you're not likely to go far wrong...

Wednesday, July 15, 2015

I wonder if the Daily Telegraph's editorial team have bothered to read the Conservative Party's membership rules...

There appears to be an organised attempt by the Daily Telegraph to sabotage the Labour Party's leadership election by encouraging its readers to join the Labour Party and vote for Jeremy Corbyn.

This is, of course, a remarkably stupid idea, especially as it will simply lead to retaliation - the Conservative policy, currently in abeyance, of having open selections will become so easy a target - and coarsen our body politic even further. Admittedly, the Daily Telegraph doesn't like democracy very much - its owners, the reclusive Barclay brothers, don't pay tax in this country and have an unusual approach to democracy on Sark - but such an overt attempt to subvert the politics of our nation is a new low even for them.

However, they might want to read Article 3 of the Conservative Party's membership rules which read, and I quote;
The Party is a political Party for the Nation, open to all who share its objects and values and who undertake to be bound by this Constitution. The Party shall consist of its Members. Membership of the Conservative Party is not compatible with Membership of or association with any other registered political party.
Now, of course, the Conservative Party will have to judge whether or not its rules mean anything, or whether or not it would be reasonable to expel someone who decided to join UKIP as well given the precedent they would be setting.

Far be it for me to interfere though...

Leadership contest: "Regrets, I've had a few, but then again, (almost) too few to mention..."

And so, polls have closed, and the candidates await their fate. Whilst they do, I thought that I might reflect on the events of the past ten weeks or so.

Firstly, whilst I have voted for Tim Farron, I would have no real concerns if the membership chose Norman Lamb. He has performed well, confirmed that he is a wonderful exponent of liberal values, and has risen in my estimation (albeit that he didn't have an awful lot of scope to do so - I have always held him in high regard). Indeed, if the Party's circumstances had been different, I could easily have found myself supporting him instead of Tim.

It has, for the most part, been an interesting campaign, especially if you don't take it too seriously. Neither candidate has ventured into the wonderful county that is Suffolk, although Norman might, occasionally, have glanced out of the window on his regular commute between Norwich and London (it's very nice between Diss and Manningtree, Norman...).

Having made up my mind and cast my vote, nobody has seemed too bothered about involving me in either of the campaigns, so I have remained beyond any partisanship, which is nice.

And that brings me to my regret. You see, leadership campaigns tend to highlight, usually unintentionally, some of the less savoury sides of political campaigning. This puzzles me because, it seems, such bad behaviour is much more likely to be noticed, and exposed, during a high-profile campaign. It also implies that the values of such people are out of keeping with the underlying one of the candidate they are espousing.

This campaign has been no exception. References to 'real liberals' (as opposed to those awful ersatz ones you get on market stalls in South London), or negative campaigning when your candidate is talking a good game about positivity and optimism, do neither you, nor your candidate, any good. And, to put it bluntly, I think rather less of you as a result. Not enough to disown you or anything, but enough to be disappointed. You're probably a good person otherwise, but you've sown the seed of doubt in my mind. I may not give you the benefit of the doubt in future, which is a pity.

And, regardless of the result, we, that is, all of us, need to pull together for the cause we believe in. Yes, we may disagree on the route to be taken, or the mode of transport, but we do believe in the same thing, liberalism. So, if you are thinking about attacking another Party member in a public forum, or even just using harsh language in response to them, do think again. It isn't clever, and it isn't worth it.

If there is a consolation though, it is that we haven't had it as bad as the Labour Party is. Don't feel that you have to prove me wrong though...

A change of title and some design notes (with grateful thanks to Frank Little)

I changed the name of my blog a few years back. It was, I admit, an attempt to escape my past and cut a new trail, some distance away from my reputation as a faceless bureaucrat. It also reflected my new status as a rather unexpected member of the country gentry.

And no, I haven't moved - I am presently sitting in our designed for purpose office across the patio from our home in the country - but it is perhaps a recognition that I am, at heart, also a bureaucrat... and proud. I think. Actually, yes, proud. Admittedly, due to management policy, I'm not allowed to tell you where I'm proud to be a bureaucrat professionally, but you get the picture (and I did sign the Official Secrets Act, after all).

I have also experienced a bit of a rebirth as a bureaucrat within the Party. I'm not a campaigner, but I am good at freeing up other people who want to do it, and are better at it than I am. I have plans, put it this way...

And so, I have reverted to the original title of this blog. Oh yes, I'll write about Creeting St Peter and the joys of rural life from time to time, and have a gentle kvetch about politics and whatever else comes to mind, but it is time to be a little more comfortable with who I am.

Talking of comfort, readers might have noticed that I changed the design of the blog too yesterday. I wasn't happy with it, but had run out of time to address the remaining issues, so saved what I had done so far. This morning, Frank Little, who has flown the flag for liberalism in one of the country's less fruitful areas (Neath Port Talbot) for many years, kindly advised that the new design wasn't working for him.

And so, I've changed it, making it rather easier on the eye, I hope. If you read this, Frank, do let me know what you think.

For the rest of you, do drop in on his blog, "ffranc sais". I do from time to time, and am always given something to dwell upon...

Tuesday, July 14, 2015

Reporting in the workplace - was your journey really necessary?

There is a danger in having a day when you have been questioning the basis of much of the information that is used to measure performance (notice that I don't use the word challenge). Today has been that sort of day.

A volunteer has been sought within my team to carry out something called 'Workplace Assessment' and, whilst I would normally been sceptical at best, I had cause to want to do something that might raise my profile a little. What better for a numerate and philosophical bureaucrat than a monitoring and reporting function?

The idea is that, in the writing of a monthly report, you establish your pace of travel towards the designated targets, consider what barriers might get in the way and what might be done to circumvent them, as well as what changes might be made to improve efficiency and effectiveness.

It was only when I read the reports already prepared by others that I realised that such a tool is only as good as its relevance. And, from a personal perspective, I didn't see that it was designed to actually allow much analysis by anyone else other than the person who had access to the core data. So, what would I want to know if I wanted to engage in the problem solving activities within the group?

First, I would want to know what the direction of travel was. Were we getting closer to our target or further from it? You need comparatives for that, rather than a snapshot, so add the previous month's data. But even that lacks something, as the target is a linear one, presuming that you will make steady progress towards the target, rather than putting the snapshots into context by comparison with historic data. So, historic data might be helpful.

What are the underpinning assumptions that go towards designating the target and, if they aren't being achieved, what adjustments can be made to make good the divergence? Do you need to do more than the expected norm, and how might you achieve that?

You might see what I'm getting at here - can management information be used to actually facilitate change, rather than explaining your failures?

So, I started off with a simple but possibly irrelevant task. Now, I have lots of questions and a deep and abiding philosophical concern that it might become complicated but definitely relevant.

Bureaucracy, it's much more complex than it seems...

Friday, July 10, 2015

A good idea spreads across the Liberal Democrat world...

Readers of Liberal Democrat Voice will recall that, three weeks ago, Ros and I were in Ipswich, taking part in the Suffolk Liberal Democrats mini-conference. Ros opened the conference, and I gave the presentation on 'behind the scenes', as part of an introduction to the Party and its works.

Featured on Liberal Democrat VoiceRos, who had come up with the idea and organised the speakers (and the guest speaker, Sir Bob Russell) offered to send a copy of the conference brochure to interested parties, and sent out about twenty or so, and our Regional Chair, who had filled a late gap in the schedule, conveyed the idea back. Indeed, the Parliamentary Party in the Lords have asked for a presentation, so that they can find out more. 

The Essex County Co-ordinating Committee liked it so much that they're going to be holding one too. Indeed, they've invited Ros to open the event, and I will be performing a reprise of my presentation (reminder to self, change references to Suffolk, replace with Essex throughout).

What will happen? Well, key activists and members will talk for four minutes each on a range of subjects:

  • Being a councillor
  • Being a Parliamentary Candidate
  • Local Campaigning
  • Making Policy
  • Going to Conference
  • Liberal Youth
  • Behind the Scenes – the Party bureaucracy
  • Using your skills – part summary, part inspiration

And then, over tea or coffee, members can ‘speed date’ with the speakers to find out more, fill in surveys to let us know their skills and interests, and meet their fellow members.

So, if you're in the Chelmsford area on Saturday, July 25th in the afternoon, and you want to know more about the various activities that you can involve yourself in, why not come along to the Trinity Methodist Church, Rainsford Road, Chelmsford CM1 2XB, starting at 3 p.m. It's close to the station at Chelmsford, so very accessible from East London too.

Ros and I look forward to seeing you there...

Thursday, July 09, 2015

TTIP: MEPs back EU-US trade deal but call for ISDS to be scrapped

The European Parliament has backed the conclusion of talks over an EU-US trade deal (TTIP) that could boost the UK economy by up to £10 billion a year, with 436 MEPs voting in favour and 241 against.

MEPs have demanded that the controversial Investor-State Dispute Settlement (ISDS) be replaced by a transparent and accountable form of investor protection that protects the right of governments to regulate in the public interest.

The Parliament's resolution also calls on negotiators to ensure that EU environmental and consumer standards are not lowered, public services such as the NHS are excluded and the transparency of the negotiations is improved.

The needs of small businesses must be prioritised in the talks, MEPs emphasised, with a focus on lifting bureaucratic barriers to make it easier for small firms and entrepreneurs to export to the US.

Liberal Democrat MEP Catherine Bearder commented:
Today's vote gives the European Commission strong democratic support to conclude trade talks with the US.
Public concerns must be taken on board. That means ISDS should be scrapped and replaced by a fair, transparent form of investor protection which ensures national governments have full control over the provision of public services.
We should also remember that the US is by far the biggest export destination for small British businesses. Helping these small firms expand by reducing barriers to trade should be at the heart of this deal.
The European Commissioner responsible for trade is a liberal, Claudia Malmstrom, and she has taken a big step towards transparency by publishing the negotiating texts online and opening up meetings to the public.

The ALDE Group's priorities for a smarter TTIP can be found at Pavel Telicka's website (he's a Czech member of the Group).

Greek crisis: Guy Verhofstadt turns his fire on Alexis Tsipras

I have, in the past, noted my view of Guy Verhofstadt, the Leader of the Liberal Group in the European Parliament, as a passionate European, and his not entirely warm relationship with Nigel Farage. But, in fairness, his passion has wider application.

Yesterday, the Greek Prime Minister came to the European Parliament and Guy took the opportunity to offer Mr Tsipras a little advice...


Wednesday, July 08, 2015

Budget 2015 - the sequel: George Osborne screws the Civil Service...

It might have been easy to miss amidst the torrent of announcements that George Osborne finally made it clear that, whilst Britain deserves a pay rise, his largesse does not extend as far as the civil servants who are expected to deliver his reforms.

The announcement that pay restraint would be extended for another four years will have come as a body blow to many who have seen their pay go backwards relative to the wider economy over the past five years, by as much as 15% in some cases.

As the Budget Report says;

1.85 In the last Parliament, the government exercised firm restraint over public sector pay to deliver reductions to departmental spending, saving approximately £8 billion. As set out by the Chancellor at Autumn Statement 2014, the government will need to continue to take tough decisions on public sector pay in order to deliver reductions to departmental spending and protect the quality of public services. 

1.86 Overall, levels of pay in the public sector are now, on average, comparable to those in the private sector. However, public sector workers continue to benefit from a significant premium once employer pension contributions are taken into account, as shown in Chart 1.10. 

1.87 In light of this and continued low inflation, the government will therefore fund public sector workforces for a pay award of 1% for 4 years from 2016-17 onwards. This will save approximately £5 billion by 2019-20. The government expects pay awards to be applied in a targeted manner within workforces to support the delivery of public services.

In other words, £13 billion worth of cuts have been, and are to be, borne by public servants who have seen their job security taken from them, their pension contributions trebled and quadrupled, and their workloads increased - 'doing more with less' has become the ever-present buzzphrase in central government.

But, we were all in it together, weren't we? And the country was in a hole, right?

Well, if you look at the OBR projections for the next four years, average earnings growth is expected to be 3.8% over the next four years, compared to the 1% increase permitted for the public sector. And inflation? Approximately 1.7%, which means that public sector workers will fall far behind their private sector counterparts and see real terms cuts for good measure.

Now, it should be noted that a 1% increase in the paybill does not equate to a 1% increase across the board. Public sector jobs come with a payscale, whereby you enter at the lowest level (usually) and reach the maximum for the grade by means of increases over a period of years. Thus, those at the top of the payscale get less. The more numerate amongst my readers will see where the issue is here. Experienced staff will be even worse off, as has been the case for the past five years.

One side effect of the reduction in public sector jobs over the past five years is a significant fall in recruitment, and a resultant greying of the workforce that remains. Indeed, Lin Homer, Chief Executive of HM Revenue & Customs, noted that very concern a few years ago, and the National Audit Office repeated the message last month.

And, when the greybeards go, as they undoubtedly will, many sooner rather than later, the promise that pay will fall behind inflation from the day a new recruit walks through the door is hardly likely to act as an incentive to join. And, for those who have marketable skills, the decision as to whether they stay or go just got a whole lot easier.

You might almost think that the Conservatives wanted to destroy the public sector. But who would administer the country then?...

Budget 2015 - the sequel: how giving people money might make them worse off

Today's 'emergency' budget has left much to think about, especially in terms of those who are thought to have lost out through changes to tax credits and other parts of our welfare system. And, indeed, there will be much pain in some quarters, but before I dive in, I'd like to take a closer look.

In the meantime, one thought springs to mind...

One of the least successful budget proposals from Gordon Brown's time as Chancellor was the introduction of a 0% rate band for corporation tax, whereby the first £10,000 of taxable profit was free from tax. Combined with divided changes that meant that, for basic rate taxpayers, there was effectively no tax paid on dividends (the tax credit is calculated by grossing up the amount paid by 11%, but no money is actually handed over). That led to an explosion in the number of limited companies formed.

Good, you might think, people taking control over their own lives. Well, yes, if you were genuinely setting up a new business. However, if you were moving from being an employee to being a director of a limited company doing the same thing, you were moving out of an environment whereby you had paid holiday time and sick pay, and into an environment where you had to make your own pension provision and ensure compliance with tax legislation, i.e. employ an accountant.

The evidence was that it was good for employers and service industries, not so good for individuals, as it moved liabilities away from big companies and placed them on much smaller, less resilient ones. And, from a government persepctive, it meant less income, and greater risk, as a limited company can walk away from its debts with little risk to the directors. It wasn't great for existing small businesses either, as their cashflow was at greater risk.

One wonders whether the introduction of the new £5,000 tax free allowance for dividends, combined with the reduction of the basic corporation tax rate to 18% will have the same effect.

In truth, getting impartial advice on whether or not to form a limited company is hard to find. Accountants have an evident conflict of interest, in that the fees they can charge for corporate accounts is higher, and they experience no personal risk one way or the other. The impact of becoming a company director is not always obvious and, in an environment where most people are surprisingly unsophisticated in terms of their personal finances, the headline impressions given by tax changes can appear awfully alluring.

Yes, you may pay less tax, but your obligations are heightened - have you seen the new Companies House penalty regime for failure to file accounts in good time? - and you are on your own if things go wrong. That works for some people, but not for others. And, frankly, most people aren't good at tax, which is good in many ways - a world dominated by accountants and tax officials is not my idea of paradise - but is potentially perilous in terms of domestic finances.

So, watch that space, although it will take a few years for the actual effects to make themselves known...

A European Union first, with @BaronessRos at its heart...

One of the curiosities of the way the European Union works is the right of the national parliaments to stop, or slow, a proposal of the Commission if it is thought to violate the principle of subsidiarity. If one third of them raise an objection, a so-called 'yellow card', the commission is obliged to review the proposal. If more than half of them object, a so-called 'orange card', the Council or the Parliament can immediately vote the proposal down.

There has been talk of a red card, something that William Hague raised as Foreign Secretary, whereby a majority of national parliaments could veto a proposal, killing it stone dead, but there seems to be little enthusiasm for that beyond the Conservative Party. However, the next innovation has come from, perhaps, an unlikely quarter, the House of Lords European Union Select Committee.

The concept of a 'green card', whereby a group of national Parliaments propose that the European Commission take action on a specified issue, emerged from the report, "The Role of National Parliaments in the European Union", and, since then, there has been some discreet lobbying done by members of the Select Committee, chaired by Lord Boswell of Aynho, of other European Union scrutiny committees across Europe.

This culminated in a debate at the COSAC (Conference of Parliamentary Committees for Union Affairs of Parliaments of the European Union) plenary meeting in Riga at the beginning of last month, where a majority of speakers supported the idea of enhancing the political dialogue by introducing a "green card" and several agreed to launch a pilot project.

The pilot project is to be based on the House of Lords report on food waste, produced by Sub-Committee D of the House of Lords European Union Select Committee, chaired by none other than Ros, and a letter has been sent to the chairs of European Affairs Committees in the other national Parliaments in advance of the next COSAC meeting In Luxembourg this week, seeking their support or amendments.

If all goes well, a letter will then be sent to Commission President, Jean-Claude Juncker, urging the Commission to take into account a series of recommendations when drawing up the proposed circular economy package to replace the one withdrawn in February.

It will be interesting to see what happens, as the notion of national parliaments working in harmony with the European Commission is a fairly radical one which might lead to a rather better Europe...

Tuesday, July 07, 2015

Welfare reform - so much for 2.2 children, a labrador and a house in the suburbs?

The reports that George Osborne is likely to reduce tax credits for families with more than two children in tomorrow's budget are interesting indeed. Superficially, it appeals to the sort of people who think that you shouldn't have children if you can't afford to keep them - as if children are like pets.

It is hardly worth going through the reasons why claimants might not have control over their circumstances and thus claim for three or more children - change (or more likely, loss) of job, the birth of multiple children at one time, etc., etc. - so I will focus on the concept of retroactivity.

The problem about children, and I say this having had none of my own, is that once you've got them, you can't undo that. They still require feeding, clothing and everything else, and in dramatically reducing the income available to do these things, you increase poverty and deprivation. Alright, it might not be a huge amount of money per household, but at a time when the financial resilience of households is fairly fragile, differences at the margins matter.

And whilst it is legitimate to question what responsibility the State has to provide support and to what extent, to withdraw that support when those impacted are unable to do anything to change their situation is questionable in terms of ethics. To do so, when you are already intending to punish larger poor families by means of the benefits cap smacks of being punitive.

Yes, you could decide that, in future, you might withdraw or reduce benefits for those who go on to have third, fourth or more children, although I would be sceptical given the potential circumstances that I outlined earlier. But you might also wonder whether or not such action is wise given the falling birth rate and the need to have young people to look after the rest of us as we get older. There are those, after all, who believe that migration from abroad will be needed to make up for our low birth rate. And you are proposing to create a disincentive to have children?

It is, unfortunately, typical of the Conservative Party that it increasingly appears to see itself as a remedy for the outrage of the ill-informed and the narrow-minded, on migration, on the welfare state or Europe or English nationalism, and so much else. Seldom, sadly, are these ideas thought through in terms of either viability of their likely consequences, and it becomes clearer by the day that not only were the Liberal Democrats a brake on the more ludicrous or unpleasant tendencies of the Conservative Party, but that they were the engine for most of the Coalition's good ideas.

Yes, it was the right of the British public to punish the Liberal Democrats if that was what they thought was best - that's how democracy works, as I understand it - but there must be more than a few people who might now be wondering if that was such a great idea...