From the BBC….

 ”A personal computer holding sensitive documents relating to defence and extremism has been stolen from Hazel Blears’ constituency office in Salford.

The machine contained a combination of constituency and government information which should not have been held on it.

The theft may mean the communities secretary has broken rules on the handling of restricted government information, the BBC has learned.”

A few points spring to mind:

Firstly, this is not an example of someone foolishly leaving data lying around. There was a break-in of Blears’ constituency office, despite its reinforced glass and security system - a legacy of her time as a Home Office minister.

Secondly, just how contentious is the material in question, which is thought to relate to emails between Blears and the DCLG? The Beeb says it is “relating to defence and extremism”.

But DCLG staff are scratching their heads over the “defence” connection, saying there are no such emails.

As for ”extremism”, this could relate to DCLG narratives on how to tackle violent extremism through improving community cohesion - the type of stuff that is on the department website.

The only classified document on the computer, bizarrely, is thought to be an assessment of the housing market from March (a PowerPoint presentation) which is now seriously out of date. 

Gordon Brown told permanent secretaries of all departments this morning to find out whether similar embarrassments could happen elsewhere.  But for now - until more definitive facts emerge - that may be all it is.

Diplomacy with Iran is difficult to follow at the best of times. Yesterday Gordon Brown added to the confusion by announcing sanctions on Iran that do not exist. Whatever his motive, it has not helped Britain’s relations with the US, the EU or Iran. Quite a feat.

Here is the background. Standing next to George W. Bush, the prime minister yesterday announced tough new EU sanctions on Iran.”We will take action today,” he said, “that will freeze the overseas assets of the biggest bank in Iran, the bank Melli.”

This delighted the US diplomats, who have been pushing the EU to take action against this bank for months. The sanctions were duly reported in the New York Times, the Wall Street Journal, the Washington Post (front page).

The big qualification to this is that there are no new sanctions in place. Bank Melli is working in exactly the same way today as it worked yesterday. It can use its assets in whatever way it likes. (Indeed, one imagines they will now be moving a lot of them to Dubai.) Its offices in London are open.

As one diplomat put it to me, Mr Brown “was wrong”. He made an incorrect statement. The problem is that the US delegation and the US press believed him. On the scale of diplomatic blunders, one delegation member put it as a “seven out of 10″.

What emerged yesterday is that the EU agreed (some weeks ago) on what action to take against Bank Melli. This is a significant step. But they have not agreed on when to take it. Downing St argue this is a formality and the sanctions will be imposed in coming weeks. Yet this gap is important, particularly as the EU has made a new offer to Iran to suspend its uranium enrichment programme in return for economic and political support. The Iranians have yet to respond. Mr Brown effectively punished Iran with the stick before Iran decided whether to take the carrot.

It is difficult to determine whether Mr Brown’s intervention has made a difference to the outcome of the talks with Iran. But it is hard to imagine the negotiators welcomed this surprise announcement, or relished explaining it to the Iranians. A decision like this is announced with the agreement of 27 EU foreign ministers, not after a UK/US bilateral. Unexpected moves like this do not help to build trust.

The British had some explaining to do to the American delegation too. Stephen Hadley, the national security adviser, was so certain the sanctions were imminent he told the White House “press gaggle” to expect an announcement after a meeting in Brussels.

“You’re going to hear, as the prime minister indicated, an expectation that out of…the EU foreign ministers meeting this afternoon…there will be an announcement of new sanctions on Iran,” he said. When asked whether the sanctions were in place, or still under negotiation, he said Mr Brown had told him they would “imposed sanctions” on Melli and examination of further oil and gas measures.

“He said it would come out of an EU foreign ministers meeting at 3pm, was what Brown said. That was his expectation, the prime minister’s expectation,” Mr Hadley said.

For the US this was an important breakthrough. For some time US diplomats have been pushing the UK to take unilateral action against Melli because the EU was dragging its feet. Full EU sanctions against this bank was a big boon to Mr Bush as he ended his farewell tour of Europe. Whenever the British officials put the US delegation straight and explained that Bank Melli had not had its assets frozen, it must have been quite a let down.

What went wrong?

Yesterday was a day of sheer drama as the terror bill was passed in the Commons by the thinnest of margins after genuinely heartfelt debate over balancing security against human rights.

And now we’ve been treated to an even more entertaining event - this morning’s resignation by David Davis, shadow home affairs secretary, ove the same issue; the defence of Habeas Corpus etc. He has already been replaced by Dominic Grieve; not temporarily.

Davis hopes that in the imminent by-election for his seat he can campaign on the single issue of human rights, turning it into a mini-referendum. Although David Cameron has known since last night, he doesn’t seem very enthused by the gesture, describing it as a “private” decision.

Will the move have the intended effect? If Davis didn’t have a rock-solid majority it would be a more brave and selfless manoeuvre.

As it is, he will still win - not least because the Lib Dems and UKIP* will not put up a candidate (Labour is undecided for now). But how will anyone know whether this is because the good people of Haltemprice and Howden, in North Yorkshire, are committed to the ancient liberties of the United Kingdom?

He may increase his majority simply because the locals hate Labour even more than the Tories**. 

* UKIP and the BNP both agree with the Tories on 42 days, they say, making it unlikely they will field candidates - although neither have confirmed this yet 

** See Crewe & Nantwich by-election 

An Ulster Lord has just dropped by to tell me that he will help Davis’s campaign. Not, not from the DUP (who swung Wednesday’s knife-edge vote for Gordon Brown). Lord Laird of Artigarvan, an Ulster Unionist peer, says he despises the alleged deal which will allow Northern Ireland to keep water rates in return for DUP anti-terror backing: “The people of Northern Ireland should realise they are getting cheaper water because some unfortunate guy is in jail”, he thunders.

Distracted, momentarily, from the 42 day anti-terror debate.

My eye is caught by the collapsing share prices of Britain’s housebuilders.

Questions are being asked about the financial viability of some of the biggest players, with Barratt, for example, down about 95 per cent in recent months.  

Housebuilders have called for drastic policies - such as lifting stamp duty for some buyers - to revive their ailing industry. Jobs losses are inevitable, they warn.

We asked the communities department for reaction today:  It says: “The conditions remain in place for a healthy house-building industry in the longer term.” *

My view? The government’s housebuilding target of 200,000 homes a year is looking increasingly hallucinogenic.  

* “We recognise that market conditions are currently difficult for housebuilders as result of the global credit crunch, which is why we are putting more measures  in place to support industry …However, the continuing high demand for homes from young families and first time buyers over the long term, and our fundamentally strong and stable economy, with record numbers of people in work, mean the conditions remain in place for a healthy house-building industry in the longer term.”

The Commitee for Standards in Public Life, the Commons watchdog, doesn’t seem to think so.

Today it showed its thinly disguised disdain for the members estimate committee, chaired by Speaker Michael Martin, which is reviewing expenses and perks and is due to report in the summer.

The standards committee issued a statement of principles which - it suggests - should “govern Parliament’s review of MPs’ allowances”.

It the outcome of the current review fails to command public confidence, it says, then the committee “is prepared to undertake its own independent review of the issues involved”.

Ministers have been maintaining for ages that the housing market is not at the start of a painful crash. Even Caroline Flint, housing minister - who was photographed with a briefing note suggesting price falls of 10 per cent this year - has maintained that long-term demand remains strong.  The prime minister, meanwhile, is pushing ahead with numerous ways to ensconce new first-time buyers on the wavering housing ladder.

Matthew Oakeshott, Lib Dem Treasury spokesman, has a suggestion for senior ministers.

Lord Oakeshott points out that the futures market is now pricing in a 13.5 per cent fall in the Halifax house price index over the coming year, 21.5 per cent over three years and not recovering to previous highs until 2018.

He suggests that if ministers are as confident as they sound - that falls will be more modest - they should put their money on this outcome.

When 35 Labour MPs signed up to an EDM criticising plans to raise fuel tax in the autumn it was seen as a massive threat to Gordon Brown’s authority.

Was it really?

When you look at the list of current EDMs - some more riveting than others - there are several, critical of the government, signed by hundreds of Labour backbenchers.

Friends of the Earth made a good point today as the Climate Change Bill was debated in the Commons. The pressure group said an EDM calling for the emissions reduction target to be fortified from 60 per cent to 80 per cent by 2050 has attracted 257 signatures, including 167 from Labour.

This is far more than those who signed EDMs criticising the abolition of the 10p tax rate, let alone the fuel tax change. Yet the government continues to fob off this tide of criticism with vague promises to review the emissions target (and the tangential issue of including aviation fumes.)

Interestingly, of the five most “signed” EDMs, four are on environmental issues (buildings’ energy performance, amphibian extinction, feed-in tariffs).  Are party leaders - backpedalling rapidly on green policies - in tune with their own MPs?  

Some speculation over the weekend about Sir Richard Caring, owner of The Ivy, Annabel’s and Le Caprice. The perma-tanned millionaire has given a constituency donation to Michael Gove, Tory shadow schools spokesman. He is an obvious target for Conservative fund-raisers.

Caring - a friend of Sir Philip Green - is still awaiting the repayment of a £2m loan due from the Labour party, borrowed when Tony Blair was in charge.

What about the other millionaires who bailed out Labour over three years ago? 

For example, it will be interesting to see whether Andrew Rosenfeld, who made a fortune in the property business, will be seduced by the resurgent Tories.

After all, Rosenfeld - who lent £1m to Labour before the 2005 election - is hardly a natural bedfellow of Britain’s supposedly left-wing party.  In 2001 the c0-founder of Minerva, a property developer, was so in with the Tory crowd that he was interviewed for the post of Conservative Party treasurer. For him to switch sides again would not exactly be out of character.

Incidentally, Rosenfeld is one of the millionaires currently negotiating a block deal with Labour to delay the repayment of more than £10m of loans falling due within two years. If the talks were going well we would have heard something by now; surely?

A month or so has passed since the Bank of England unveiled its £50bn-plus liquidity injection to free up the financial system.

The radical move, which could see as much as £100bn of mortgage-backed securities swapped for gilts, was designed to pump confidence into the banking market. 

The idea was that our mortgage costs would come down. And small companies would be able to access loans.

Not that ministers said this explicitly, but it was the obvious aim.

So how are we faring? Libor, the rate at which banks lend to each other, is still stubbornly high. The gap between the Bank of England base rate and 3-month sterling Libor remains at 0.86 per cent. 

 In a nutshell, that means mortgages are not about to become cheaper. Abbey is increasing some of its fixed rate deals by up to 0.56 percentage points today - only a week after it and some rivals carried out a couple of cuts, prompting speculation that the bad days were over.

And did I mention house prices (see various FT Westminster Blogs passim)? They fell by a record 2.5 per cent in May, according to Nationwide, the biggest drop since such records began.

The Treasury is not happy with the idea that it could scrap its proposed 2p increase in fuel duty AND its new tax on gas-guzzling cars - and still beat the relevant revenue forecasts by more than £4bn if oil prices stay at their current highs.

Here is the theory of Maurice Fitzpatrick, senior tax manager at Grant Thornton, the accountants:

Tax revenues from North Sea oil would jump from an estimated £10bn - struck when oil was only $84 a barrel - to £16bn at the current price of about $128 a barrel.
Since the Budget in March, the Treasury has already taken an estimated £820m more than its forecasts in North Sea oil tax.
The £6bn of surplus revenue would easily cover the cost of U-turns on both fuel duty and vehicle excise duty, where ministers are introducing new bands which could cost an extra £200 for drivers of inefficient cars.
Deferring the 2p increase in fuel duty by six months would cost £550m. Scrapping the revamped vehicle excise duty altogether would mean the loss of an estimated £465m next year and £735m next year - although ministers may only remove the retrospective element of this tax.  

But Number 10 has disputed this, saying this afternoon: “The Treasury has always made clear that the impact of high oil prices on public finances tends to be revenue-neutral over the long-term.”

Here is their argument:

The increased revenues from oil when prices are high are offset by a number of factors including:

 *   an increase in pump prices leads to an increase in inflation.  This knocks through to the inflation-linked payments that the government has to make, including benefits, pensions, tax allowances, and government bonds.

*   reduced demand for fuel from filling stations, which reduces revenue from fuel duties - as this is fixed at 50.35p per litre if people buy less fuel, revenue from this falls.
*   receipts from profits made by North Sea oil companies have in recent years been to some extent offset by capital costs, and the costs that have been rising for plant and machinery and labour costs too.

So there is a net offsetting effect.

That is the theory, anyhow.