Monthly Archives: February 2012

Michael Gove featured heavily in today’s PMQs. Ed Miliband began his questions by asking whether the prime minister would condemn the education secretary’s recent comments that the Leveson inquiry was having a “chilling effect” on freedom of speech.

But it was during the inevitable debate on the health bill that Mr Gove played an unspoken, but important role.

Ministers seem to be changing their tone in a subtle way when defending the NHS reforms, taking on some of the tactics deployed by the education secretary when he was pushing through the Free Schools agenda.

Instead of talking up how radical the plan is, the government is now downplaying it. We hear that the bill is about “evolution, not revolution”, and more strikingly that it is building on what Labour did while they were in government.

It was this latter point that the prime minister stressed today, reeling off a list of former Labour health secretaries or advisers who back competition in the NHS (which is not the same as backing the bill, mind). He added: Read more

House of LordsThe comments by Lord Lee in today’s FT are quite extraordinary. The Lib Dem peer opposes the coalition’s plan to reform the House of Lords to such an extent that he has threatened to quit his role as a Lords whip if it pushes ahead. He said:

There is absolutely no public demand for this at all, and pretty much zero support from serious political commentators.

He added that the coalition faced a “long, bitter and bloody battle” if it pressed ahead.

Lord Lee is not alone: we have now learned that 14 Lib Dem peers wrote a letter last year to the party leader outlining their opposition to his plans for an 80 per cent elected chamber.

In the letter, the 14 said:

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The news broke yesterday that Lord Glasman had agreed to take up a political column on Rupert Murdoch’s new Sun on Sunday newspaper, along with Toby Young.

It was a curious decision for the Labour peer given how hard Miliband has attacked Murdoch over phone hacking. Read more

In his second answer at prime minister’s questions today, David Cameron asked a question of Ed Miliband:

As we are being kept here to vote on the publication of the NHS risk register, why don’t you ask a question about that?

It seemed like a strange tactic. Why would the prime minister, who has been ordered by the information commissioner to publish the document detailing the potential risks of his NHS bill, want to bring up the fact that he is refusing to comply? Surely this was a subject on which Labour, not the government, holds the upper hand?

Only after the prime minister had put the challenge several times did we find out why he was so keen to talk about it.  Read more

Liam Fox has been making waves this morning with this opinion piece in the Financial Times. Here is our news story off the back of it.

The intervention has been carefully timed by Fox, still in rehabilitation mode after he was forced to quit the cabinet over the Werritty saga before Christmas.

The MP is still a standard-bearer for the Tory right, in particular those who believe fervently in free markets. In his article he calls for a cut in National Insurance for employers and also for a loosening of the labour market to allow easier hiring and firing – as recommended in the controversial Beecroft report.

Many other Tory MPs share his view that the Budget needs to be a  Read more

Protests against Tesco's work experience schemeIain Duncan Smith was once more on the attack this morning against critics of the government’s work experience scheme, under which young people are told to sign up to a four-week placement at one of a range of businesses or lose their benefits.

The scheme has been controversial for two reasons. One is that it meant young people who were claiming benefits while looking for a job were not able to do work experience in their own chosen field; instead they had to go on a government-mandated scheme at a company such as Boots, McDonald’s, Argos, Tesco or Primark. The second is it meant some of the countries’ biggest companies profiting from free labour, which is why one activist referred to it this morning as “slavery”.

Writing in the Daily Mail, the work and pensions secretary has dismissed such criticisms however, saying:

Armed with an unjustified sense of superiority and sporting an intellectual sneer, we find a commentating elite which seems determined to belittle and downgrade any opportunity for young people that doesn’t fit their pre-conceived notion of a ‘worthwhile job’.

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David Cameron, Nick Clegg and Andrew Lansley meet medical professionalsToday’s report from the London School of Economics into whether competition works in the NHS is likely to be cherry-picked (to use an apt term) by both sides in their fights for and against the health bill.

Ministers will love its headline finding, that competition works in the NHS. The researchers found that after Labour introduced competition between hospitals in 2006, waiting times before operations (an internationally recognised measure of transparency) fell. Using the kind of terminology only academics can, the report’s authors found “moderate but statistically significant” reductions in patients’ length of stay. They added:

These 7 to 9 per cent gains would have produced non-trivial savings.

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We revealed this morning in the FT that Treasury officials believe that as many as 100 civil servants may have been paid through private companies rather than individuals – far more than had previously been thought.

That marks a major widening from the 25 at the Department of Health exposed in the Guardian yesterday. The health department admitted that many of the staff paid in this way were full-time employees and had worked in the department for years. Read more

I wrote this week about talks between the Tories and Lib Dems about the possibility of lowering the cap for how much workers can put into their pension pots while still enjoying tax relief.

Since then a couple of pensions experts have got in touch to explain some further implications of the measure, which mean that for two reasons, it could be more controversial than I first realised.

Firstly, I suggested that people enjoying the maximum 50% tax break enjoy a 50p top-up to their pension pot for every £1 they put in.

In fact, the relief is worth even more, because the amount is a tax relief calculated on pre-tax income. So if you qualify for the 50% relief, and put in £1, your tax is waived, meaning that the government has essentially put in 50p of the £1 you put it. Cancelling this for some people would therefore be even more of a blow than I first calculated.

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Ping pongAnother day, another Lords defeat for the government. Last night, peers voted by a majority of only 10 to moderate proposals to cut housing benefit from people in council houses who have spare rooms. Under the amendment passed, war widows, foster carers and disabled people would be exempt from the cut, which DWP says would cost £100m.

Many within Number 10 are delighted at this defeat. They say that the more peers defeat the welfare bill, the more it keeps these popular proposals in the news. It reminds voters of some of the government’s most vote-winning schemes and helps paint the Lords and Labour as out of touch. One senior coalition source told me that it was a “win-win” situation, saying:

Obviously we’d like to get the reforms through and onto the statute book, but we’re quite happy for this to go on a bit longer.

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The Liberal Democrats have a problem. They have staked their colours clearly to the mast when it comes to raising the minimum threshold for income tax to £10,000. Most expect it to be done by the end of the parliament, if not by 2014.

The problem is, this will cost money – £4bn if it’s done by 2015, £5.5bn if it’s done by 2014 – and there isn’t much of it floating around. Lib Dems will tell you they are keen on two options to pay for this: one is to clamp down on tax avoidance; the other is to tax the pension contributions made by higher earners.

Both options are likely to make some kind of appearance in the Budget in March. But it is the latter that raises the serious money, and carries potentially serious risks for the coalition. Read more

A fortnight ago, MPs caught a fleeting glimpse of a process that has, to this point, taken place discretely: the Information Commissioner’s Office investigation into the office of Michael Gove over suspected breaches of the Freedom of Information Act.

A transcript is now available for Mr Gove’s appearance before the education select committee, when he answered questions on the topic. He said the DfE had not released data from one document in response to FoI requests because it was political.

The law is straightforward: only government data is covered by the FoI Act. Party political or private business is never captured, even if it is sent via a government email address. Official business, however it is transmitted, is always covered.

In circumstances where there is a mix of party, personal and government business, official data is released and the remainder is redacted. So the whole text would need to be party political and not official for the document not to be covered by the act.

We have published it below.

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David Cameron has been quoted saying he will not rule out quotas for women on boardrooms as a way to get more women into top executive jobs. Speaking at a summit in Sweden, the prime minister said he wanted to “accelerate” the increase in women on the boards of top UK firms – even if this was ideally without quotas.

A year ago an official report by Lord Davies into the issue urged companies to more than double the number of women on boards by 2015. At present the proportion of female FTSE 100 directors is about 15 per cent, though they tend to be non-executives rather than executives.

Mr Cameron said Scandinavian countries were “leading the way in Europe” on the issue of women in top executive jobs. In Norway, where quotas were introduced in 2008, the proportion is 40 per cent. (Other countries are following suit with quotas including France and Spain). Read more

When Andy Burnham returned to the health beat for Labour, some in Andrew Lansley’s team were delighted. This is the man, they pointed out, who said he would not ringfence spending on the NHS. He even said that to do so would be “irresponsible” – hardly a vote-winning tactic.

David Cameron clearly thinks the same thing – that by shifting the focus of the health debate onto Burnham and his refusal to promise extra money for the NHS, he can nullify the controversy surrounding his health bill.

That is why, several times during today’s session of prime minister’s questions, Cameron insisted:

That’s what you get if you get Labour: no money, no reform, no good health service.

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The issue of cuts to council tax benefit may sound esoteric; what’s one more cut in a world of public sector austerity?

Yet most cuts to benefits are relatively simple to administer: you still give people money, just less of it.

Council tax is rather different, as it involves taking money from people. Cutting council tax benefit means that you need to collect even more money from them.

There is already a high level of non-payment of this levy and some local authorities are worried that the problem will only get worse when the cut comes into force.

I explain the full situation in this article.

In a nutshell, the government is not only cutting the benefit by 10 per cent but also shifting responsibility to councils. But ministers have made it much harder for local authorities to carry out the cut as they have ordered them to exempt pensioners and “vulnerable groups”, thought to include the disabled and families with children.

That means that out of 5m people who receive the benefit, only an estimated 1.3m may have to take the impact of the cut – implying they could be hit with a reduction of almost a third.

That would mean an average of £330 per person, equivalent to the average household’s Read more

Two strands of thought are emerging about David Miliband, the Labour leader that never was, who launched his report into youth unemployment on Monday.

The first is that he is a cowardly figure, willing to make coded but bitter attacks in the New Statesman against his brother, but unwilling to follow it up with action. The second is that he is a great wasted talent, a serious policy thinker who should be brought back into the front line, one way or another. (I should say, of course, that these two things are not mutually exclusive.)

The first was savagely articulated by Matthew Norman in Friday’s Telegraph. Under the title “The sniping and self-pitying of a truly feeble man”, Norman wroteRead more

It is hard to know who will take the political credit for Network Rail’s directors dropping their plan for any annual bonus this year: Ed Miliband or Justine Greening? Both had made clear their concerns about any extra pay-out to the board of the quasi-private company (which receives £4bn of taxpayers’ money every year) ahead of the announcement. Ms Greening, the transport secretary, had even vowed to turn up to a public meeting of the group on Friday to vote against its recommendations. Meanwhile there was growing pressure in the form of an early day motion by former Labour transport minister Tom Harris, signed by 30 MPs.

The news came through some five minutes ago: Not only will Network Rail delay its meetings of around 100 board members, which was due for Friday. Read more

Another week, another executive in the line of fire over their bonus. This week it is Sir David Higgins, the plain-speaking Australian in charge of Network Rail, which manages the country’s rail infrastructure.

NR members are about to vote on the pay structure under which executives will be allocated their bonuses later this year. The scheme could see Sir David pocket a £340,000 annual bonus (plus much more in long-term incentives), which has triggered anger given the company’s declining performance.

Justine Greening has now said she will become the first transport secretary in the company’s ten-year history to get involved with its administration when she attends a meeting to vote against the scheme.

But before she does so (in comments made, in fact, before the whole controversy blew up), Sir David has got his retaliation in first.

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Chris Huhne has written to both the prime minister and deputy prime minister offering his resignation. The exchange with Cameron is in a separate post. Here are the letters between the former energy secretary and Nick Clegg, the man he once challenged for the party leadership:

Dear Nick,

I am writing to resign, with great regret, as Energy and Climate Change Secretary. I will defend myself robustly in the courts against the charges that the Crown Prosecution Service has decided to press. I have concluded that it would be distracting both to my trial defence and to my official duties if I were to continue in office as a minister.

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Here is what Chris Huhne wrote to David Cameron in his resignation letter, and what the PM wrote in return:

This letter is to submit with much regret my resignation as Energy and Climate Change Secretary.  I intend to mount a robust defence against the charges brought against me, and I have concluded that it would be distracting both to that effort and to my official duties if I were to continue in office.

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