Monthly Archives: September 2011

Jim Pickard

The tactics in the battle of Daily Telegraph v George Osborne/Greg Clark over the planning system are the equivalent of trench warfare. The ministers insist, day in, day out, that they will not budge over its planned changes. Introducing a new “presumption in favour of sustainable development” will help the economy to grow, they fervently believe.

On the other side we have the Telegraph, which agrees with charities who fear that the changes (a new ‘national planning policy framework’) are a licence for developers to run amok.

The Tel believes that by running front page stories every day it will finally force the government to capitulate. So far we have had doomsday stories suggesting this slender document will result in the death of English countryside; Noah-style flooding; a collapse in house prices; and even the slaughter of all children born within 100 metres of an oak tree*. Equally, ministers seem to hope that if they keep repeating their arguments ad nauseum the Tel will just give up and turn its attention elsewhere.

I’ve written before about how both sides are exaggerating the potential impact of the changes.

What is curious, however, is that the new “presumption” has its antecedents which – on the face of it – were equally, if not more, positive for developers. (I only know this because someone senior at DCLG pointed it out to me.)

For four decades, until 1991, there was a presumption in favour of development which “did not cause demonstrable harm to interests of acknowledged importance“. That then changed into a “presumption in favour of the development plan, unless material considerations indicated otherwise“. Then in 2004 this was replaced by a John Prescott plan expressly designed to get thousands of new homes built.

In other words, the new guidelines are not massively different to those which came before – and which did not cause enormous angst.

Of course you could argue that during that period Britain saw some damaging out-of-town development, reminiscent of the USA – and that many green fields were lost. But it is wrong to suggest that Osborne’s new plan is in any sense revolutionary.

* This may be a slight exaggeration

Elizabeth Rigby

I wrote a piece today on Labour’s attempts to exploit the Tories’ failure to connect with women voters. The piece highlights the coalition’s failure to help low-paid women cope with childcare as a major issue for the working mother. But during my research, another issue was brought up by Tory women: David Cameron’s marriage tax allowance.

It may be the Tory leader’s totemic ‘family’ policy but it is exactly the sort of scheme that chimes well with his old-style grassroots but does little to endear the party to the plight of the working couples.

Under the scheme as it was outlined before the election, a married couple only benefits if one person stays at home since the policy is based on one member of the couple being able to transfer £750 of their tax-free personal allowance to their partner to reduce the ‘family tax bill’. Eligible couples where the main earner has an annual income of between £7,300 and £42,000 will be £150 better off.

Jim Pickard

This morning I wrote on the FT front page that Ed Miliband has been accused of “hypocrisy” for launching his moral crusade against ‘bad’ business while Labour officials are negotiating a £1m donation from Andrew Rosenfeld, a former tax exile.

Rosenfeld is also controversial because in 2005, during the collapse of Allders, he refused to accept responsibility for its £68m pension deficit despite his large financial stake in the retail chain – through a vehicle called Scarlett Retail.

Meanwhile this morning Miliband is trying to refine his message further, suggesting that Labout is “not anti-business but anti-business-as-usual” – which is a much more effective line.

Channel 4 are doing more on Rosenfeld tonight. As Gary Gibbon writes on his blog:

 

You can see Jon Snow’s interview with the Labour leader tonight. It’s particularly interesting on whether the self-proclaimed ripper-up of the rule book intends to carry on negotiating a £1m donation from Andrew Rosenfeld, who only recently returned to the UK from Geneva and was criticised for refusing to accept responsibility for a pension deficit at Allders even though he had a chunky stake in the firm  (you can read a bit about it all in today’s FT).

Ed M says that on this donation he is playing it all by the rules: “we are not flouting the rules.”  Hmm. Not ripping up the rules exactly? The predator/producer check will be run very tightly by the media on who donates from corporate Britain to the Labour Party in future. Also who advises and who endorses.

Jim Pickard

Ed Miliband wants to help “producers” and not “predators” through the tax system. And through regulation. This was one of the driving messages of his speech.

At face value it’s hard to argue with that. But where things become far from crystal-clear is when you start to think about the detail of how a government would go about doing this.

Firstly, how do you separate hundreds of thousands of companies into “good” or “bad”? And how, in practice, do you penalise or reward them?

Miliband and his team know what a bad company looks like. It resembles Southern Cross, or Enron, appparently. This is obvious. And they know what a good company is: it manufactures things and invests for the long term.

But what about the majority of companies – which are in a grey area of neither “good” nor “bad”; or a mix of both.

In his speech the Labour leader contrasted the virtuous Sir John Rose, chief executive of Rolls-Royce, with pantomime villain Sir Fred Goodwin – who was paid three times more.

Sure. But did anyone notice at the time? Could they have done? And if ministers had suggested that RBS was a disaster waiting to happen – would anyone have listened?

Equally pertinent is this question: If many hedge funds and private equity groups and “asset strippers” are based offshore – how do you use the tax system to punish them?

I’m told that this is all “direction of travel” stuff and it’s too early to have any details. I don’t get the impression, however, that any of them have the faintest outlines of a palette of alternative options – let alone their most likely choice. (Equally on more fairness in the welfare system there is no detail; the idea of tightening the criteria for social housing allocation is not new.)

Meanwhile my colleague Andy Bounds asked Alistair Darling, former chancellor, what he thought about this. His answer: “If I build in a city centre am I good for investing or bad for speculating? Businesses are there to make money.

 

Kiran Stacey

Labour figures believe David Cameron was onto something when he started talking about “ethical capitalism” in 2009. They feel he then abandoned such talk when he became prime minister, and reckon that Ed Miliband now has the opportunity to capture that ground.

That is why his speech was so heavy on words many in New Labour would have hated: words like “values”, “right” and “wrong”. Take this passage for example:

You believe in the values of the long term. But in our economy, you’ve been told the fast buck is ok. And what’s happened? We’ve ended up with a financial crisis and you’ve ended up footing the bill.

One member of the shadow cabinet described the strategy to me as like putting up a (morality) tree from which you could hang various attacks, whether on nefarious bankers, feckless benefits cheats or asset-stripping corporate vultures.

The worry will be, however, that moralising starts looking like hectoring. Already commentators are starting to question the value of lines like “You know what your values are.” People don’t want to hear that, they want to hear what Miliband’s values are.

Helen Warrell

So, will Labour field candidates for the election of police and crime commissioners or will it find a way to avoid putting up its own contenders?

Toby Harris, Labour peer and former chair of the Metropolitan Police Authority, warned conference delegates in Liverpool on Monday that party grandees are considering not contesting the PCC vote in November 2012. But this morning, Yvette Cooper, shadow home secretary, was quick to dismiss suggestions of a boycott. She told the BBC:

That’s not what we are proposing but we will have to consider how we respond to the legislation that has just gone through Parliament. We will be thinking about the best way to respond to do that.

Kiran Stacey

Ed BallsEd Balls’s flagship announcement at his party conference speech was a “five-point plan for growth”. Some of the policies were old, some were new. He said that if Labour was in power it would:

  1. Repeat last year’s bank bonus tax, using the money to build 25,000 affordable homes and guarantee a job for 100,000 young people;
  2. Bring forward long-term investment projects, such as schools, roads and transport;
  3. Reverse the VAT rise now for a temporary period;
  4. An immediate one-year cut in VAT to 5 per cent on home improvements, repairs and maintenance;
  5. A one year national insurance tax break for every small firm which takes on extra workers.

Jim Pickard

All is calm in Liverpool. Unlike last year’s Labour conference in Manchester, ripped apart by fratricide and the gloom of being in opposition for the first time. Or the year before that – in Brighton – when, despite looming defeat, delegates were gripped with election fever. (Akin to the music-playing on the Titanic ahead of its final plunge.)

In recent years Labour fought against the inevitability of eventual electoral defeat with no regard to the internal collateral damage. Now its people have realised that government is at best a long four years away.

There is no overwhelming sense of disunity. For sure, the Blairites and the left-wingers still disagree on which direction to take the party; but without the viciousness of the past. Out of power and without a policy platform such arguments can only be philosophical rather than practical.

Nor have there been personal fisticuffs. I’m told that David Miliband considered staying away altogether to avoid negative coverage. In the end he dropped in for a day and made a plausible display of loyalty to his brother. This morning we saw Ed Balls describe Ed Miliband as a “friend”. (The reality may be closer to ‘frenemy’, but relations are better than they were eight months ago.)

This does not negate the fact that the party still faces considerable hurdles.

Jim Pickard

Ed Miliband suffered a setback on his first day of the Labour conference after he failed in his symbolic attempt to reduce the relative influence of unions over future leadership elections.

A new cadre of “registered supporters” – thousands of members of the public who wants to influence the result – will have up to 10 per cent of the total vote, after a “Refounding Labour” document was expected to be passed at the Liverpool gathering.

But this will be at the expense of MPs, constituencies and unions alike, contrary to Mr Miliband’s original plan to carve out the new group from the union section – a move which would have diluted the union’s influence.

And the registered supporters will not get any vote at all until they get to the magic figure of 50,000.

The Labour leader had been keen to make the symbolic break because of criticism of the way in which he won last year’s leadership elections with heavy backing from the big unions.

The final result annoyed some constituency members, who had presumed that their vote would not be diluted as a result of the initiative.

The Financial Times revealed earlier this month that the unions had thwarted similar proposals to reduce unions’ voting power at conference from its current 50 per cent. That issue will now be debated again next spring.

Kiran Stacey

Amid the Labour-dominated headlines this morning on the first day of the party’s autumn conference in Liverpool, something else caught my eye. The Independent on Sunday had a story about David Cameron tackling Alex Salmond head on. It read:

David Cameron is to go head to head with Alex Salmond in a bitter battle over the future of the union between England and Scotland.

The Government is to fight what it sees as “outrageous” claims and increasingly aggressive moves towards complete self-rule from the Scottish First Minister in a desperate attempt to stop Scotland from “sleepwalking into independence”.

Jim Pickard

We’ve written a long piece in the main FT this morning about the widespread attempts in Whitehall to avoid FOI requests – by civil servants as well as special advisers. Texts, private email addresses, more phone calls, and inserting *s in the middle of key words are among the popular methods.

One anecdote didn’t make it into the newspaper and it seemed worth repeating:

Late last year ahead of the Pope’s visit to London, officials in the Foreign Office used text messages to tell officials in the Greater London Authority that they would prefer Boris Johnson not to shake the hand of the distinguished visitor – although their attempts failed. ‘You can see how they would not have wanted that conversation to have been FOI-able’, says one person who saw the messages.

The mystery is why anyone would want to stop this particular photo-call – my mole has no idea.

Helen Warrell

There is a growing confusion over the government’s target of reducing net migration to the tens of thousands by 2015 – at least, its chief adviser on immigration issues seems to think so.

As I reported last month, the 21 per cent increase in net migration over the past year, taking the total to 239,000 – more than twice the level the home office needs to reach in four years’ time – must have made uncomfortable reading for the department’s number crunchers.

However, speaking at London’s Global Immigration Conference yesterday, Professor David Metcalf, chair of the Migration Advisory Committee, suggested that the firm target of less than 100,000 was actually more of an “aspiration” for the government. He told the lawyers at the International Bar Association event:

There are certain tensions within the coalition about whether [the tens of thousands] is a firm target or an aspiration.

This is not the first time that such tension has been mooted.

Westminster blog

on the UK political scene

About this blog Blog guide
Jim Pickard and Kiran Stacey, FT Westminster correspondents, share the latest news and analysis on the UK's political scene.

Follow the latest news on the UK politics and policy.

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All posts are published in UK time.

Contact the Westminster blog team: Jim Pickard, Kiran Stacey, Nicholas Timmins, Elizabeth Rigby and Helen Warrell.

The illustrations of Jim and Kiran are by Nick Hardcastle.

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The authors

Jim Pickard joined the lobby team in January 2008. He has been at the Financial Times since 1999 as a regional correspondent, assistant UK news editor and property correspondent.

Kiran Stacey is an FT political correspondent, having joined the lobby in 2011. He started at the FT as a graduate trainee in 2008, working on desks including UK companies and US equity markets before taking over the FT's Energy Source blog.

Contributors

Elizabeth Rigby, the FT's chief political correspondent, joined the lobby team in September 2010. Elizabeth has worked at the FT for more than a decade and was most recently its consumer industries editor.

Helen Warrell is the FT's UK reporter, covering home affairs, crime and policing. She joined the FT in 2008 and has spent time as a reporter in the Brussels bureau and more recently, editing the paper's Asia coverage on the world news desk.

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