Guido has done a tremendous job this week highlighting Ed Balls’ shambolic management of his old constituency office. (The one where all my letters seemed to get lost and go without reply when I wrote to Ed as my local MP on many occasions……) First there was the court letters, then Matt Hancock MP got involved, and now the local paper is on his case. And apparently, today is his birthday!
Sadly it seems Mr Balls has form for being a Jeremy Hunt as far as his own pocket is concerned.
It seems only fair to highlight another gem of personal finance wisdom from our now esteemed Shadow Chancellor, which was first picked up by the Daily Mirror back in 1998 but has eluded many of the BeatBalls brigade!
According to the story, Balls arranged for the hotel where his wedding guests stayed to charge an extra £9 on room bookings - reducing his wedding bill by £2,520.
Gordon and Sarah Brown (then unmarried) were in attendance, along with a host of other movers and shakers from Labour.
Oh, and the cost wasn’t itemised on the bill - it was added without the knowledge of guests.
Almost as if it was some kind of tax, by stealth, to fund a supposed ordinary bloke to enjoy the luxury of Cavendish Hotel, Eastbourne.
You could even say, a stealth tax to fund profligacy with the budget.
A business without capital grows slower. A business without cash goes bust. So why is all the debate about lending?
The government has made much recently of ensuring that SMEs have access to lending. Rightly so, as without access to capital investing in growth is often all but impossible. However, given we have just come out of a recession, is that really the issue for most businesses?
In reality, I expect not. Over the past few months I’ve been self-employed and the single biggest problem I faced was getting paid. My experience of working in SMEs is not dissimilar - and I expect most businesses have not been worrying about borrowing to finance investment, but about having enough cash to make payroll.
So why don’t we do something about it?
The nature of being an SMEs is that you are dependent on being part of a supply chain. That supply chain usually led by a bigger company. When the top of the supply chain comes under pressure - say it’s a retailer needing to discount to keep hard-up customers - the pressure flows down the supply chain. Rarely is profit margin lost at the top of the chain.
One recent way this pressure has been exerted is to extend the payment period for suppliers. 30 day payment was ditched, in favour of upto 120 days. So you have to pay your staff four times before your company gets paid once. And inevitably, refusing to accept the new terms doesn’t mean you keep the old terms - it means you loose the contract.
Given most people in this country work for SMEs, it would surely be a politically savvy move to help them? Yet all we have is rhetoric on lending and access to public sector contracts - neither of which are the reason small companies fold.
Small businesses have felt the brunt of red tape more than large ones, and employment regulations add a disproportionately large amount of cost. Isn’t it time we levelled the playing field a bit?
I think we are now at a time where we need a legal payment term - perhaps 60 days - and extend unfair contract terms legislation to cover it.
It would cost Government nothing, and arguably do more to help small businesses than any other piece of legislation for decades. It would also support the development of innovative ideas and technologies, which are often born in SMEs, boosting the wider economy. Furthermore, competition would be improved as small companies would have greater cashflow security and therefore the ability to negotiate harder.
I see this as win-win for SMEs, the UK economy and corporate governance. So where’s our champion to make it happen?
Today the Prime Minister and Deputy Prime Minister will be making speeches on the proposed change to the alternative vote. The excitement is almost palbable, within about 100 yards of parliament.
I’m outside that zone - while I am instinctively drawn to the merits of first past the post, the issue definitely isnt top of the issues I think need to be addressed. And maybe a little less vitriolic tribalism wouldnt be a bad thing. Anyway, today it gets second billing to this. And, if it arrives, the new Radiohead record.
The problem is, who is making that case in local papers, on the streets and in community meetings?
Already it’s clear that many labour local authorities are hitting frontline services harder than others. They blame cuts in central government funding, while offering up meagre savings as evidence of some effort towards cutting costs. Sadly it barely touches the surface - Wakefield met council, for example, announced it was cutting 1,000 but the leader continues to enjoy a chauffeur driven Audi sportscar.
There is of course a massive vested interest here - central administration is both the power base of unions, and the power base of civil servants (both in local government and Whitehall) and overcoming this will require more than the odd speech lamenting the deficit.
The problem is - who is driving the innovation?who is challenging the political posturing and supposed ‘inevitability’ of reduced services.
With constituency boundaries being redrawn, parliamentary candidates - often the de facto opposition in some areas of the country - won’t be in place until very close to the next election.
Equally, its sadly true to say some local council groups are not always the most resourceful opposition, and end up opposing everything and making no positive case for change.
The 38 degrees group can claim some credit for mobilising the public on the forest sell off issue - but here’s my concern: where’s the citizen democracy group pressuring MPs and councillors when they announce a frontline cut without first tackling waste or the back office? Who is making the case for reduced allowances, fewer councillors or scrapping glossy taxpayer-funded magazines and newspapers.
I hope central government acts on this and is far more aggressive in taking this fight to local councils cutting the frontline.
One area the government could make a huge difference is in shared services - not driving local authorities to work together, but offering a central ‘app store’ style model of back office tools. In this day and age payroll, absence management, time management, invoice receiving and payment - all can be done quicker and cheaper online.
DCLG could employ a team of specialists, working with ministerial support from one local authority to the next, scrutinising activity and offering cost saving measures.
Localism needs the public to be engaged in decision making - the real challenge is that the biggest decisions on local service delivery are too often being made without an alternative being offered.
The outcome of the next election will quite possibly depend on whether the public believe that alternative existed.
There’s been a great deal of noise in past week about ‘what’ the big society is - and apparently this week will see a flurry of announcements on ‘big society’ projects.
Aside the fact that it’ll take more than a few days of press releases and speeches to cement a massive new concept in the public conciousness, there is a broader question at issue - namely, why is the definition an issue?
One problem in Westminster is often the role of policy ‘wonks’ in delivering policy. Nearly a year on from when the concept was first flagged at a high level within the Conservative party and became part of the manifesto language, large swaithes of the population don’t have any idea what it is, think it’s about volunteering or see it as a trojan horse for cuts.
The vacum in definition that has existed since the concept was flagged has allowed skepticicms and uncertaintly to take hold. As was often said of Gordon Brown, a re-launch can’t change what hasn’t been launched in the first place.
So, rather than worry about a definition, I think its time to cut our loss, stop trying to shape government by the big society and try and shape the big society itself by action, not words.
Put another way - crack on with what matters to people.
Why? Well probably because the general public, unlike Westminster politicos, couldn’t care less if there’s an agreed definition or shiny report - they care about the quality and availability of the services they access, and what it costs them.
To coin a phrase, if you build it, the definition will come - to each individual according, to their experience.
If two years down the line the public have seen and like the change it leads to, then take the big society flag and plant it at the heart of a new Britain.
But if worrying about a definition consumes westminster, the public will begin to wonder if politicians on all sides are fiddiling while Rome burns.
The Localism Bill will radically change the involvement local communities have in decision making - a landmark reform that will do much to reinvigorate local democracy.
However, as has already been seen with salvos from the likes of Liverpool and Manchester councils, front line services are being axed with Central Government being blamed by local councillors and activists. As has been shown time and time again though, cutting front-line services is the easy option too many in local Government turn to, rather than taking a long, hard look at their own organisational structure and questioning how services are delivered.
For example, Wakefield council is scrapping more than 1,000 jobs, but as far as I can tell the chauffer driven car the leader of the council enjoys, and the council’s own newspaper, are not for the chop just yet.
So how do we deal with this situation? I propose something very much in the spirit of the Localism Bill - abolish the cap on council tax rises.
At present, the Secretary of State for Communities and Local Government has the power to cap council tax increases. This year, the cap is 3.5%.
Tax has been off the political agenda since Tony Blair’s victory in 1997 and the (entirely symbolic) pledge not to raise income tax. But in times of deficit - where crudely the choice is between increasing the money coming in (tax rises) or to decrease the amount going out (spending cuts) - or a combination of the two - why not make tax part of the debate again?
I’d go even further - legislating that every ballot paper in the local elections must detail the increase in council tax proposed by the leading party, allowing the electorate to decide for themselves.
If, as many on the left tell us, the general public are outraged by ’savage’ spending cuts, why not give them the choice to pay for the services they wish to keep, but that can presently not be afforded?
In a situation like the Forgemasters loan, rather than running to central government for help, elected leaders could make the case for increasing local taxation to provide funding.
Many on the left are quick to point out about the reductions in frontline services, and how apparently this will reduce Britain to some kind of stone-age country, but they avoid with fervour any debate about how to pay for their community cohesion officers or regional spacial strategies. They aliken councils cutting council tax to evil privateers, overlooking the fact the public seem to quite like having their tax bill cut - and are far from up in arms about service provision.
The arguments around spending cuts are only one side of the coin - let’s make the debate full and open, and bring tax into it with equal weight. Those who want to expand Government can argue to do so, and the public decided on polling day whether or not they want to foot the bill.
The possibility of prisoners being able to claim compensation for being denied the vote has riled many, with the media, commentators and politicans on all sides talking up the issue. Ken Clarke went as far as to question how MPs could vote against the bill, as it would require them to “explain to their constituents, at a time like this, we’re spending money on compensating prisoners.”
Some on the left have criticised the Government’s decision to allow a free vote, with Ben Fox’s New Statesman post calling the free vote decision ‘cowardly.’ Their criticism seems based on the fact a free vote will probably mean the House of Commons voting down the proposal (more on that later) while entirely ignoring the fact that this issue arose with a judgement in 2005 and the last Labour Government did absolutely nothing to deal with it.
I won’t get into the arguments on whether or not prisoners should get the vote - I’d like to keep this post under a few thousand words - but the compensation line has me worried. Simply, I think it’s a myth.
There are roughly 2,500 legal actions pending on this issue, 1,500 of which are ‘frozen’ pending the UK Government’s action on the issue. There is a deadline for action, 6 months after the judgement of Greens and M.T. v. the UK.
That case didn’t test the law - it was based upon five years of inaction by the UK Government since the 2005 case of Hirst v the United Kingdom (No.2) - that was the case that established a blanket ban on prisoners voting violated the European Convention on Human Rights.
The only money awarded was €5,000 to cover costs and expenses. Given they won their case, this is hardly a legal revolution. To reach the £160m compensation figure reported and repeated, all 2,500 applicants would need to receive £64,000 each.
In future follow-up cases, in light of the above considerations, the Court would be likely to consider that legal costs were not reasonably and necessarily incurred and would not, therefore, be likely to award costs under Article 41. As a consequence of the Court’s approach to just satisfaction outlined above, an amendment to the electoral law to achieve compliance with the Court’s judgment in Hirst will also result in compliance with the judgment in the present cases and with any future judgment handed down in any of the comparable cases currently pending before the Court.
So, that seems fairly conclusive. What about punitive damages? In the Green judgement, the court was similarly clear:
“..as regards non-pecuniary damage, the Court recalls that it has in the past examined claims by applicants for punitive damages to reflect the particular character of the violations suffered by them and to serve as a deterrent in respect of violations of a similar nature by the respondent State, and for aggravated damages to reflect the fact that they were victims of an administrative practice. It has declined to make any such awards (see Akdivar and Others v. Turkey (Article 50), 1 April 1998, §§ 35-38, Reports 1998-II; Selçuk and Asker v. Turkey, 24 April 1998, §§ 116-119, Reports 1998-II; Menteş and Others v. Turkey (Article 50), 24 July 1998, §§ 18-21, Reports 1998-IV; Hood v. the United Kingdom [GC], no. 27267/95, §§ 88-89, ECHR 1999-I;and B.B. v. the United Kingdom, no. 53760/00, § 36, 10 February 2004).
Similarly, the Court does not consider that aggravated or punitive damages are appropriate in the present case.”
Again, fairly clear.
Where could compensation arise? There is one issue - that of the UK being in breach of it’s obligations under EU law. Were the EU to penalise the UK for its ongoing breach, the money would go to Brussels, not prisoners. (Although for many, myself included, this is no means an acceptable outcome, particularly given Russia is guilty of many more breaches.)
Finally, there is undoubtedly the potential for a bizarre legal state of affairs to emerge, as such:
One could argue if Parliament rejects a law intended to bring the UK into line with its obligations under the European Convention on Human Rights, that would be tantamount to an implied repeal of the Human Rights Act. That, in turn, could be interpreted by the Courts as Parliament asserting its supremacy to EU law (for the Lisbon treaty establishes the legal basis for the EU’s accession to the ECHR) and therefore implicitly repealing the European Communities Act 1972, and therefore Britain’s membership of the EU.
So, there you have it. Let’s debate the issue of prisoner voting, but doing it behind a veil of compensation figures only cheapens the arguments on all sides.
A few years ago, I joined a campaign (simply ‘No Star Wars’) against the use by the US of North Yorkshire’s Menwith Hill radar base. Such was the open-minded and democratic virtue of our last Government, Tony Blair’s Labour party decided to announce that he’d given the green light to the US request (along with the upgrading of RAF Fylingdales) on the last day before Parliament went into recess, amid another 29 similar announcements. (I know, amazing isn’t it, Blair going along with a request from Bush Jr without looking at the facts…..)
Aside from the democratic validity of deliberately obstructing debate on an issue that goes to the heart of Britain’s strategic role in Europe and the world, there was a wider point at issue then - the system didn’t actually work.
So, while embarking on an arms race of stratasphoric proportions (for indeed the natural progression from the shield was for weaponising the upper levels of the earth’s atmosphere and ultimately space) we did it before the thing even worked. Alas, we were told, it’s essential or we’ll all get nuked by a ‘rogue state’ like Iran or North Korea. Now, Wikileaks has exposed a key flaw in this argument - the system couldn’t actually see nuclear weapons.
It was a farce Britain supported a system that had yet to even work, a shameful act of Parliamentary abuse to rush out the confirmation and I hope this news will be the last nail in the coffin of a scheme that should be left where it belongs - in Ronald Regan’s favourite 1970s sci-fi B-films.
Replacing a journalist who made his name in the ‘tomorrows chip wrapper’ mentality of showbiz journalism with a broadcast news editor will ensure the Coalition is seen well in coming months. The GVs of Cameron, Clegg et al will be fresh, dynamic and show the team in a positive light.
This in itself is no bad thing. As Guido blogged last week, many felt David Cameron needed a TV expert as a “director of communications who understands televisual imagery” and I agree entirely with what he says. Cameron (and indeed the coalition) needs someone to present it in the best light, no mean feat given the difficult decisions the Government is taking.
But this falls into what I think is a common problem that modern politicians often fail to comprehend - the difference between presentation and communication.
Last year I blogged a speech given by Edward R. Murrow, the journalist who did so much to finally end the McCarthy-era of American politics, to what is now the the Radio Television Digital News Association’s Convention on October 15, 1958.
“During the daily peak viewing periods, television in the main insulates us from the realities of the world in which we live. If this state of affairs continues, we may alter an advertising slogan to read: LOOK NOW, PAY LATER.”
The Coalition is embarking on an enormous task, tackling Labour’s economic legacy of a dangerously unbalanced economy, out-of-control public spending and the defecit that both of those approaches caused.
Yet the public will not be appeased with warm images and reassuring soundbites. The Coalition has yet to establish it’s own narrative on cutting public spending or indeed set it in context of the alternative - much higher taxes for all. This requires a more strategic, long-term view and as difficult as it may be politically, looking beyond short-term factors like polling, by-elections and indeed local elections.
The Big Society is a concept which could transform the British way of life, endearing a sense of civic responsibility not seen for generations, based on a balanced and vibrant, low-tax economy. David Cameron’s determination to bring this vision to fruition, despite the catastrophic legacy he inherited, is one of the reasons he may well go on to achieve more than any Prime Minister in living memory.
It cannot be achieved through a series of headlines - it requires a culture shift.
Alastair Campbell forumlated a style of campaigning (and indeed governing) based around Objective, Strategy, Tactics. With the appointment of another headline driven journalist, the coalition must not allow itself to become obsessed with strategy and tactics, or risk sight of achieveing its objective.
The Coalition’s challenge to ensure the public not only understand the objective but share it will be the difference between the middle classes (and indeed aspirational working classes) supporting the Government, or believeing it has betrayed them.