Monthly Archives: January 2012

Jim Pickard

You can read our full story here on about Fred Goodwin losing his knighthood. Here is my backgrounder on other well-known names who lost their honours.

Meanwhile here is the Cabinet Office statement:

It will soon be announced in the London Gazette that the Knighthood conferred upon Fred Goodwin as a Knight Bachelor has been cancelled and annulled.

This decision, not normally publicised in advance, was taken on the advice of the Forfeiture Committee, which advised that Fred Goodwin had brought the honours system in to disrepute.

The scale and severity of the impact of his actions as

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Jim Pickard

I wrote in this morning’s FT about how Lord Mandelson has sidestepped a new requirement for peers to disclose certain business clients after exploiting a loophole in the system. As I wrote:

He had been expected to be among a wave of peers to publish a full list of their clients under new rules voted through the House of Lords last November.

But the former Labour business secretary has avoided any need to do so after simply moving his advisory firm, Global Counsel, from one category to another on the Lords register.

The company was previously registered under Mandelson’s name under “category one”, indicating a directorship.

But by shifting Global Counsel to “category 2”, which covers “remunerated employment”, Lord Mandelson no longer strictly has to provide this information.

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Kiran Stacey

Government ministers have had to get used to an unusually truculent House of Lords in the last few weeks, as I wrote about last week.

Both the health and welfare bills might have to undergo serious change if they are to pass the upper house in time for the Queen’s speech.

But peers are also debating another important bill at the moment: the legal aid bill. And that could end up being yet another source of tension. Read more

Jim Pickard

We wrote this morning about the Tory backlash to Nick Clegg’s speech in which he called for an acceleration of the personal tax allowance – which is currently pencilled in for 2015.

One way to interpret his words was a further attempt by the Lib Dem leader to stamp his brand over the tax giveaway, one of the few pleasant fiscal moves of recent years. (Although how progressive the change is has been the subject of debate.) The Lib Dems have been tacitly authorised to “own” the personal allowance issue – just as the Tories have ownership of scrapping the 50p rate. The difference is that raising the allowance is part of the coalition programme and scrapping the highest income tax rate is not.

But is Clegg being realistic by suggesting that the move could be hastened even further? Nowhere did we hear any mention of the potential extra cost yesterday of accelerating an already expensive (£4bn) plan.

Today there are two figures knocking around – £1.5bn in the FT and £9.5bn in the Times.

Neither is wrong; they are just based on different calculations as to what might happen. (The Treasury estimates that each increase of £100 in the allowances costs just under half a billion pounds).

The Times calculation is based on the tax change happening in full Read more

Jim Pickard

Ed Miliband has done an interview with Paul Waugh in the House magazine: there are a few interesting nuggets.

The Labour leader has dismissed the idea of a new Royal yacht, at least with any public money. He says that the “welfare state is too inadequate in some parts” – such as child care, elderly care and social care. Read more

Kiran Stacey

Harrier jump jetsAn additional 3,000 civilians will be axed from the Ministry of Defence after ministers realised the department’s “black hole” – the gap between revenue expectations and spending commitments – was bigger than previously thought.

This “black hole” has become one of the government’s most effective examples of Labour profligacy versus coalition (especially Conservative) fiscal discipline. But in truth, we’ve never really known how big it is or how close it is to being eliminated.

It is generally reckoned that when the coalition came in, there was a £10bn gap that needed closing over the course of the parliament, but the total overspend on existing projects could eventually be as high as £38bn. Read more

Jim Pickard

Nick Clegg is making a speech today where he will call for the £10,000 personal tax allowance to be accelerated faster than its 2015 target – indicating that the wealthy will be squeezed in the Budget to pay for this.

This threshold policy is clearly branded as a Lib Dem policy; the 2011 Budget saw a significant lift of the figure by some £630 or so. Party strategists believe that it is an easy concept for the public to understand and casts them in a positive light. Read more

Kiran Stacey

David Cameron was asked in today’s prime minister’s questions about the critical report from the government’s auditors on the government’s flagship back to work scheme.

The National Audit Office warned that providers of the £5bn Work Programme are working to overly-ambitious targets which they might not meet. They believe that out of the group of people who are easiest to get into work, only just over a quarter will be successfully placed. That compares to government estimates of 40 per cent.

The prime minister tried to brush off the problem during PMQs, sayign the risk was not to the taxpayer, but to the providers themselves:

The basic point is the Work Programme is not putting the taxpayers at risk, it is putting providers at risk. It is about payment by results, it is about getting things the previous government never did.

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Kiran Stacey

It was no surprise that Ed Miliband led on the economy today, on the day that GDP figures showed a drop in output in the last quarter of last year.

The Labour leader’s questioning was more effective than usual. He has a new line that looks like it could pay off:

He and his chancellor are the byword for smug, self-satisfied complacency.

It certainly gives us all some relief from the previous ubiquitous epithet Labour applied to the prime minister and his party of “out of touch”. Read more

Jim Pickard

This morning’s legal decision against Chris Huhne’s department, DECC, may serve as a welcome distraction for the energy secretary given his other thorny issue.

(He is of course awaiting a decision by the Crown Prosecution Service as to whether to prosecute him over allegations that he asked his former wife to take speeding points on his behalf.)

Then again it may just add to the pressure on the beleagured Lib Dem cabinet minister.

Solar companies are today celebrating victory over the government after the Court of Appeal upheld an earlier legal decision that recent cuts to household solar subsidies were illegal.

Three Court of Appeal judges ruled that parliament did not have the power to make such a modification “with such a retrospective effect.”

The government must now pay costs for the solar industry and has been refused permission to appeal.

It will also have to pay its original higher subsidy for customers who installed panels between early December and the start of March – a cost which could run into tens of millions of pounds in the long term.

The verdict is in some ways a Pyrrhic victory for the industry as solar subsidies will still be halved as of March 3. But companies which would have seen their subsidies Read more

Kiran Stacey

When countering claims from charities and campaigners that the government’s proposed benefits cap would push people into homelessness, Iain Duncan Smith, the work and pensions secretary, made a fairly eye-catching claim. He told the Today programme:

The [definition of homelessness] that’s used by the pressure groups is that certain children would have to share rooms.

Well, most of your listeners would find that astonishing. For them homelessness is not having any kind of accommodation, reasonable accommodation, to go to and being on the street. I can guarantee that is not going to happen.

This was surprising: did charities such as Shelter really think homelessness means children sharing bedrooms? The answer to that is no – as Shelter’s strongly-worded riposte makes clear. Campbell Robb, their chief executive, said this afternoon: Read more

Jim Pickard

Journalism is the first draft of history, not the last. For a good example it’s worth turning to the first few months of Gordon Brown’s regime, which were described almost universally as a brilliant example of political leadership – as the new PM tackled floods and whatever else. In retrospect this was a rather generous verdict.

And according to the journalistic narrative, Ed Miliband has had a catastrophic start to 2012. Just awful. The Labour leader is up to his armpits and flailing, such is his predicament. Such is the verdict from many of our most learned commentators of late. Read more