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Osborne: If Britain begins to live within our means we can have lower interest rates

George Osborne has just addressed the LSE on The Economic Policy of Recession. At the heart of his speech is the idea that control of the public finances is necessary to give the Bank of England the freedom to cut interest rates. In recent days his approach has won the support of former Tory Chancellors, Lord Lawson and Lord Lamont.

Mr Osborne concluded his speech with these words:

"There is now a clear choice in British politics. Irresponsible borrowing now and higher taxes later under Labour. Or the responsible Conservative plan, enabling the Bank of England to deliver a sustained cut in interest rates and lay the ground for lower taxes later. Helping families and businesses today by getting money into their pockets directly, instead of hoping that trickle-down public spending will work one day. Building a better economy for the future through economic change, not more of the same. And above all, preparing for the recovery through fiscal responsibility, not burying it under a mountain of debt before it starts.”

Other highlights of the Shadow Chancellor's speech are pasted below:

Labour governments are all essentially the same: "On the wall of my office in Westminster is a set of cartoons from the 1970s depicting the economic calamities of the time. One shows Denis Healey sitting at a desk with his in-tray piling up with problems – home economy, unemployment, inflation, world trade recession. Another shows him raiding a child’s empty piggy bank. A third shows the manifesto promises of the Labour Government of the time overwhelmed by an economic avalanche. Visitors to my office used to look at these cartoons and remark how the world had changed. I now look at them and think how much is now the same."

The automatic stabilising role of fiscal policy: "Government borrowing rises automatically in a recession, as tax revenues fall and spending on unemployment benefits rises. This is what is meant by the term “the automatic stabilisers.” That is not a virtue, it is a necessity. So these “automatic stabilisers” should be allowed to function. That is what is starting to happen now. But we shouldn’t be fooled. This increase in borrowing is the inevitable consequence of recession not a strategy to fight it. It is an overdraft, not a plan."

Continue reading "Osborne: If Britain begins to live within our means we can have lower interest rates" »

October 31, 2008 at 12:52 in Economic Policy, Tax and spending | Permalink | Comments (25)

Was it Cameron who triggered the suspension of Ross?

Paul Waugh makes a realistic case that it was Cameron wot did it:

"There is a credible case for saying that it was the Conservative leader's intervention in the row on Tuesday that was the most significant trigger to real action.

By stepping into the controversy and making clear he shared the views of the public, Cameron in turn forced the Prime Minister to speak out. Once Brown (who was very reluctant to get involved) had spoken, the Beeb knew it could no longer get away with its shaky defence and DG Mark Thompson finally roused himself to act.

Cameron's decision to speak out wasn't just smart politics. It perhaps underlined his frustration that he had been ambushed by Ross on his programme two years ago. Many will remember Ross's asking the Tory leader whether he masturbated over a photo of Margaret Thatcher. I call myself pretty broadminded, but even I was appalled that Ross had coarsened a mainstream TV channel in a way that would be barely acceptable in a pub bar.

Cameron was clearly uncomfortable, but was keenly aware that if he over-reacted at the time he could lose the younger demographic of Ross's show. He didn't really have any choice in saying he would go on the show again - as Opposition leader who would want to boycott a prog that reaches millions?"

PS Our view is that Paul now writes the best blog from a Westminster Village journalist. Add it to your favourites!

PPS Paul; you must change that photo of you... it doesn't do you any favours :-)

October 31, 2008 at 10:28 in Broadcasters, media, arts | Permalink | Comments (26)

Ten predictions about economic policy and UK politics

(1) The terms of the banks' recapitalisation programme will come to be seen as too punitive.

(2) Alistair Darling will announce some modest tax cuts - targeted on low income workers and smaller businesses. They will be too small to make much of a difference to the path of the recession but Labour will attempt to present themselves as the real friends of the low-paid and business.

(3) The Tories will say that tax cuts now (unless funded by spending restraint) are irresponsible and will make it harder for the Bank of England to cut interest rates. Conservative spokesmen will be instructed to say 'Britain must live within its means' at every possible media opportunity.

(4) The Bank of England will cut interest rates but not as quickly as necessary and Britain's recession will be among the deepest in the developed world.

(5) The Conservatives will stay in the economic policy game by announcing lots of sensible but small measures to help small businesses and families.

(6) George Osborne will establish an economic advisory council including big beasts like Ken Clarke, John Redwood and Lord Forsyth.

(7) As recession bites and people fear for their jobs and homes the Tories' opinion poll lead will grow again.

(8) A YouTube ad targeting Brown's economic bust will be as symbolic for the 2010 General Election as the Labour isn't working poster was for the 1979 election. Something like this (used against George W Bush) should do the trick:

Children Will Pay - video powered by Metacafe

(9) The Tories will win the Election but inherit dire public finances. There will be enormous debate within the Conservative Party as to whether George Osborne's first Budgets will need to deliver spending restraint and tax rises or spending restraint only. Opponents of tax rises will prevail.

(10) Burdened by debt and an unreformed public sector, Britain will underperform our major competitors for much of the next decade.

October 31, 2008 at 08:47 in Economic Policy, Tax and spending | Permalink | Comments (21)

Tories 9% ahead in YouGov poll

The poll appears in The Telegraph.

October 30, 2008 at 23:00 in Opinion polls | Permalink | Comments (42)

Russia's neighbours cannot rely on the EU, says Hague

European leaders like to talk about the exercise of soft power but perhaps Europe is simply just soft?

The Telegraph is reporting that the EU is preparing to start negotiations with Moscow on a special partnership deal. Yesterday Peter Mandelson heralded a thawing of Britain's own relations with Russia.

All so soon after Russia invaded Georgia and Brussels promised a firm response.

Shadow Foreign Secretary William Hague worries that such talks would send the wrong message to all of Russia's neighbours:

"It would show Russia that aggression pays off, that Britain and other European countries are incapable of holding a firm line against aggression and that Russia's neighbours cannot rely on the EU to protect them from Russian bullying."

October 30, 2008 at 17:23 in Europe, Foreign affairs | Permalink | Comments (16)

George Osborne's non-Treasury roles

In today's Spectator, Fraser Nelson details the responsibilities of George Osborne beyond those of Shadow Chancellor - co-ordinating for the next general election and managing party policy.

Nelson notes of the last of these roles the degree to which the Shadow Chancellor is also now the de facto head of policy:

"Mr Osborne’s third job is de facto party policy chief and, in this capacity, he has effectively supplanted his former boss in the Tory Treasury team, Oliver Letwin, who now defers to him in policy meetings. Such is his stature that shadow cabinet members grumble about being outranked even by Mr Osborne’s aides, who have accrued the de facto power to approve or reject proposals in his absence.

"The only consolation is that Team Osborne includes perhaps the best and brightest in the Tory party — an elite squad including Matt Hancock, Eleanor Shawcross, Rohan Silva and Rupert Harrison — whose members are seconded from time to time to other party responsibilities. Few shadow cabinet members could dream of gathering around them such a staff."

Nelson suggests a clearer focus from Osborne on the Treasury role would be preferable:

"A year ago it looked as if Mr Osborne could do all three jobs standing on his head. Now, none is going well. Take policy development. An email was sent out from Tory HQ earlier this week blaming Lord Mandelson for the increased number of Labour initiatives getting into the newspapers. To counter this, a request was made for a ‘strong and steady flow of our own policy ideas to release between now and Christmas’. And in the true Cameroon spirit of recycling, such ideas ‘do not necessarily need to be brand new’. Hardly the battle roar of a party brimming with intellectual energy.

"It is not that Mr Osborne lacks talent: quite the opposite. Staff in Tory central office say he brings clarity and enthusiasm to campaigning strategy. Those who attend policy meetings report that he is an indispensable corrective to Mr Letwin, who tends to complicate things. Yet there remains widespread confusion about who does what at the top of the Tory hierarchy, thanks to the Cameroons’ penchant for doubling up and doing each other’s jobs. Rumours swirl about tensions among them, and yet another reorganisation of the Conservative Research Department is now on the cards."

October 30, 2008 at 09:30 in Team Cameron | Permalink | Comments (59)

Have your say in the latest ConservativeHome survey

In addition to the regular tracker questions we are seeking your views on transport policy, membership of the Euro and fiscal policy. Click here to have your say.

October 29, 2008 at 13:16 in ConservativeHome Members' Panel | Permalink | Comments (6)

PMQs dominated by questions of debt and borrowing

VERDICT: Another poor PMQs that taught us little about what the Government or Opposition will do to tackle the recession. Brown was at its worst in not answering questions but Cameron did not deliver any big blows.

Highlights, not verbatim:

12.17pm: Philip Hollobone asks the PM to condemn the Black Police Association for discouraging ethnic minorities from joining the Met. Brown replies by promising to look into the matter. (David Davies MP delivered the message to the Black Police Association yesterday that it was behaving irresponsibly).

12.15pm: Sir George Young asks why the House of Commons sits so infrequently. Brown says he has given Parliament more powers - including approval of the nation going to war.

12.13pm: Nick Clegg calls for the PM to distinguish between good public spending and any public spending. The LibDem leader calls for big tax reliefs for people on ordinary incomes - paid for by closing tax loopholes. The PM says that the LibDem policy of cutting £20bn from public spending is the wrong policy for this time.

12.10pm: The Prime Minister has been caught red-handed, spinning that he would be spending to get out of recession but having no plan to do so. The Prime Minister's irresponsible boom has become a bust. Brown counters that the Tories have no policy to take Britain out of recession. They are not ready for Government, he concludes.

12.08pm: Cameron asks if the PM believes that you can spend your way out of recession? Brown doesn't answer. Cameron then reminds him of words from 1997 when he said that you "can't spend your way out of recession".

12.06pm: David Cameron says that Brown's fiscal rules have been broken. Brown responds by saying that the Tory position on borrowing is unclear. The Tories don't know if they favour more borrowing or less.

12.04pm: David Cameron says it's impossible to believe that we're not in a bust when 120 homes are being repossessed every day and the Bank is forecasting that 1.2 million will be in negative equity. If he can't admit his errors noone will listen to him about the future. Brown attacks Cameron for partisanship and for failing to end Punch and Judy politics.

12.02pm: David Cameron asks (again) if the PM still thinks he has abolished boom and bust. The PM responds by recording key Labour 'achievements'.

October 29, 2008 at 11:48 in PMQs | Permalink | Comments (53)

Jeremy Hunt calls for broadcasters to help fight alcoholism and other social ills

Shadow Culture Secretary is giving a major speech this morning on the future of Conservative broadcasting policy. At the bottom of this post we publish key extracts relating to his support for more local TV and his concerns that the BBC might be crowding out alternative media suppliers. Most interesting to us, however, is his view that TV influences behaviour and broadcasters - particularly those in receipt of privileged funding - have a duty to behave responsibly. ConservativeHome wholeheartedly agrees (but we are 'nudgers' as you know).

First Mr Hunt addresses the influence that broadcasters do have on behaviour:

"The University of the West England recently found that 73% of all alcohol references on radio encouraged drinking. That matters, because for better or worse what Chris Moyles says has more impact on binge drinking than the glossiest advertising campaign from the Department of Health, or indeed an alcohol education campaign by Radio 1. It isn’t all bad news. The media can have an equally strong effect in a positive way. Eastenders’ Mark Fowler [pictured] was the first mainstream soap character to be HIV positive. A 1999 survey by the National AIDS Trust found that most young people learned everything they knew about the illness from watching him deal with his condition. Lisa Power at the Terrance Higgins Trust has said that ‘one decent soap episode is worth a thousand leaflets in schools’. HIV has returned to TV drama with Hollyoaks currently tackling the issue – I hope it is as successful as Eastenders was in the 90s."

Mr Hunt goes on to say that a few “worthy” programmes "should not be a fig leaf for a lack of social responsibility in other output.":

"It’s not good enough for Channel 4 to say they are doing their bit with a Dispatches programme on alcohol abuse like Drinking Yourself to Death when 18% of the screen time in Hollyoaks was accounted for by alcohol references. Nor can five claim to be doing their bit with Diet Doctors Inside Out when the gym instructor in Home and Away is seen with alcohol in 50% of his scenes."

Continue reading "Jeremy Hunt calls for broadcasters to help fight alcoholism and other social ills" »

October 29, 2008 at 10:53 in Broadcasters, media, arts | Permalink | Comments (18)

George Osborne defines his anti-recession policy in 78 words

On Monday we urged George Osborne to make a clear statement of Tory macroeconomic policy for the recession:

"What the Conservative Party appears to be saying is that only by restoring discipline to the public finances will the Bank of England have the room to make large and sustainable cuts in interest rates. The Tory economic team has decided that further borrowing will make it harder for the Bank's monetary policy committee to make those cuts. It is not the policy that ConHome would have chosen (we are attracted to the Lilico plan of large but time-limited tax reliefs) but it is a credible policy and needs to be explained."

The Shadow Chancellor has done exactly that today in a robust article for The Telegraph. Read the whole piece here but there are 78 words that really matter:

“The Government should do nothing that makes it more difficult for the Bank of England to cut interest rates. It must be for the independent MPC to make its judgment, but it is a statement of fact that, with interest rates still at 4.5%, there is plenty of scope to stimulate demand with lower rates. A spending splurge, funded by extra borrowing over and above what the recession is already forcing on us will make that less likely.”

Mr Osborne will no doubt roll out more measures that will help families and businesses cope with the recession - building on existing commitments to freeze council tax and introduce a VAT holiday for small firms - but the task of beating the recession has been given to Mervyn King and the Monetary Policy Committee. There will be no big Keynesian tax reliefs or spending increases from the Conservatives.

October 29, 2008 at 06:26 in Economic Policy | Permalink | Comments (46)

Questions for you

The end-October survey of Tory members and ConHome readers goes 'into the field' tomorrow. Please use the thread below to suggest questions.

October 28, 2008 at 17:31 in ConservativeHome Members' Panel | Permalink | Comments (33)

After a difficult week George Osborne moves on to front foot

George Osborne has called on BP to cut the price of petrol after it announced bumper earnings:

“BP have absolutely no excuse for not passing on any fuel price falls to customers. It would be a scandal if they do not.”

The Shadow Chancellor also announced new ideas to help small and medium-sized businesses earlier today. The latest ideas focus on making it easier for SMEs to bid for public sector contracts. Download a pdf of the proposal.

On Platform on Saturday Mark Prisk MP set out the existing Tory commitments to the small business sector.

October 28, 2008 at 13:24 in Economic Policy | Permalink | Comments (54)

John Whittingdale leads concern at Ross-Brand calls

Conservative MP John Whittingdale - Chairman of the Culture, Media and Sport Select Committee, has asked tough questions of the BBC in the last 24 hours. His intervention followed a prank message left on the answer machine of elderly actor Andrew Sachs. Jonathan Ross and Russell Brand broadcast their controversial voicemail on Saturday night on BBC Radio 2. Mr Brand suggested he had slept with Mr Sachs' 23-year-old granddaughter, Georgina Baillie, an aspiring model.

John Whittingdale said:

"The trouble is, this is not the first occasion on which Jonathan Ross has crossed the line and has been pulled up by the BBC and told not to carry this kind of material, and it appears that has had little effect... [The BBC pays] a very substantial amount of public money for Jonathan Ross and a pretty large amount for Russell Brand too. I think they are both talented broadcasters but they have got to remember that when they are broadcasting on the BBC in particular, they are not able to use material they might use in a live show. The message needs to be rammed home. It does raise questions about their future with the corporation...

I think anybody who listens to Jonathan Ross and Russell Brand has a rough idea of what to expect but, in my view, this did go too far. To make that kind of comment to a much-loved, elderly character actor like Andrew Sachs was pretty offensive in the first place. To then broadcast it to two million people seems to me unacceptable."

Mr Whittingdale called for OfCom to investigate the matter.

The Mail leader-writers do not require an investigation. They've already decided: "Is there any reason why we should be expected to go on paying this vile man [Brand] - or the executives who judge his filth fit to broadcast?"

1.45pm:

David Cameron has joined this controversy: "The BBC have got some very straight forward questions to answer. Why did they allow this programme to be broadcast? Who made the decision to broadcast it? How high up the editorial chain did it go? Who examined it? Why did they conclude it should be broadcast? The BBC needs to be transparent about all of those decisions and explain its decision-making process so everyone can see what more needs to be done." (Quoted in The Sun).

October 28, 2008 at 08:22 in Broadcasters, media, arts | Permalink | Comments (52)

New poll brings us back into hung parliament territory

But it's just one poll - ComRes for The Independent. The overall ConservativeHome Poll of Polls is still pointing to a Tory majority of 64. The fieldwork for the poll was begun after the 'Yatchgate' controversy had broken.

Former Tory MP Michael Brown is savage in today's Independent about the party's response to the economic crisis:

"The Tories should be worried if they cannot maintain substantial poll leads at the very moment voters are about to pay the price of 11 years of New Labour. But the Cameron mantra of "sharing the proceeds of economic growth between tax cuts and public spending" is redundant when the economy is in recession. However, fearful of being trapped again as the party of cuts, the Tories are frightened to spell out the obvious truth that Mr Brown's resort to Keynesian pump-priming will be a failure. Neither Mr Cameron nor Mr Osborne has the courage to present an alternative economic policy because it is becoming obvious they do not have one."

The Conservatives do, of course, have an economic policy - based around creating the room for sustainable interest rate cuts - and yesterday we called for it to be articulated.

9.15am: "The Tory policy for dealing with recession is not clear, even to their own supporters. That's the conclusion from the PHI100, Britain's most authoritative survey of expert and inside political opinion."

October 28, 2008 at 07:04 in Economic Policy, Opinion polls | Permalink | Comments (92)

Prepare for next year's European Elections

The biggest electoral hurdle for the Conservatives and the General Election are next June's European Elections.

A strong showing by the Kilroy-Silk-powered UKIP at the 2004 Elections somewhat derailed Michael Howard. UKIP are a shadow of their former self but the Tories worry about a strong BNP performance. The BNP won a seat on the GLA during this year's London elections.

It is the duty of the Conservatives to ensure that voters feel their concerns about European integration, immigration and crime are being heard by the mainstream - as well as highlighting other Conservative themes of free trade, concern for the environment and international justice. Our manifesto for those Elections must have policies in all of those key areas to minimise any swing to the extremes. A pledge to hold a referendum on Lisbon, a transparency agenda for MEPs' expenses and the Tory plan for a Border Police Force must all feature in our campaign.

Some Tory MEPs favour term limits as a way of stopping their colleagues from 'going native'. One MEP supports making a link between the UK's budget contribution and improved auditing of the EU budget.

Rupert Matthews, one of our East Midlands MEP candidates, has already been leading a ConHome discussion of what could be included in our manifesto.

> Step 6/10: Conservatives need their own democracy agenda

October 27, 2008 at 19:48 in BNP, Europe, Ten next steps, UKIP | Permalink | Comments (15)

Conservatives need their own democracy agenda

ConHome is delighted that Nick Herbert has already promised fairer-sized constituency seats but the Conservatives need a bigger 'democracy agenda'. We'll return to this agenda on another occasion but here are three things we hope to see:

End the power that big money and big unions have in the political process. By the end of a Parliament the maximum donation to a political party should be reduced to something like £1,000 or even lower. Such a change would have a revolutionary impact on how political parties relate to voters. Big money donations from business, unions or the taxpayer insulate parties from real voters. The internet could be harnessed to build political parties that rely on the little guy for their income. Barack Obama has shown the way.
Move to a system where we have more and more City Mayors. City Mayors - like US Governors - would not only be good for their communities but could be the heads of Cabinet departments of the future. Too many of our MPs lack executive experience. We need to build a system which sees a Prime Minister appointing successful Mayors to run Whitehall initiatives and departments.
Share the BBC licence fee with a new public service broadcaster (or broadcasters) - built on a different model of impartiality (Peter Whittle explains more). Jeremy Hunt is taking steps in this direction but will he be bold enough? Ending The Guardian's near monopoly of public sector ads should also be part of a Conservative vision to end the privileged status of the BBC-Guardian worldview.

> Step 5/10: Greg Clark must keep the lights on

October 27, 2008 at 17:03 in Broadcasters, media, arts, Constitution and democracy, Localism, Party funding, Ten next steps | Permalink | Comments (19)

Greg Clark must keep the lights on

We have high hopes for Greg Clark MP, the new Shadow Secretary of State for Energy and Climate Change. We don't expect him to be as cautious about climate change as we are, but we hope that he'll ask very tough questions of those who insist that their way of tackling climate change is the only way. He could start with the EU. Open Europe's Hugo Robinson writes for ConHome today about the inflexibility of the Brussels' climate change plan and how it might be bad for the environment and disastrous for the economy. If there is to be an international agreement on climate change - beyond the EU and involving India and China - Greg Clark should be urging a rethink of the EU model.

More importantly - as far as we are concerned - is the need to keep the lights on. Matt Sinclair put it well on CentreRight:

"The reason why Ministers love working on climate change is that the outcomes are all decades and centuries in the future so there is no real accountability. By contrast, people will notice if the lights go out. While politicians can try and blame the energy companies, or hope they're in a different job by the time poor choices lead to economic disaster, there is a much greater chance that the public will notice when political leaders let them down in energy policy than with climate change."

The Tories had been dragging their feet on energy policy although latterly have been making more positive noises about nuclear energy and clean coal. Greg Clark needs to demonstrate that the Tories have a plan to address the looming crisis in British energy supply. The insecurity of Britain's energy supply - and the associated expense to business and consumers - is set to be a top-of-the-news issue in five years' time. Greg Clark is as clever and courteous as Michael Gove. He now needs to prove that he is as courageous. We hope Greg will be to energy policy what Michael Gove has been to education policy.

> Step 4/10: Put Eric Pickles in CCHQ

October 27, 2008 at 15:20 in Energy, Environment, Ten next steps | Permalink | Comments (8)

George Osborne: I did make a mistake over Deripaska but I didn't break any rules

Highlights, not verbatim, from George Osborne's interview on Radio 4's World at One programme:

Yatchgate: I didn't break any rules but I did make a mistake. It didn't look good. I regret how I operated. I will no longer be involved in party fundraising.

Sterling's slide against the dollar: There is a "flight from sterling" because of concern at the UK economy. It represents an international vote of confidence in the UK economy and our levels of borrowing.

Interest rates: The Chancellor and Shadow Chancellor should not speculate about the future of interest rates but should respect the independence of the Monetary Policy Committee. Keeping control of the public finances makes it easier for the Bank to cut interest rates; something everyone in the country wants.

Public spending: Gordon Brown "is a man with an overdraft not a man with a plan". The extra borrowing he is advocating is not a strategic move as part of a plan but simply a reflection of reduced tax receipts and higher benefit payments associated with the recession.

October 27, 2008 at 13:22 in Economic Policy, Party funding, Tax and spending | Permalink | Comments (34)

Put Eric Pickles in CCHQ

The newspapers are full of those Bullingdon photographs again. You would have thought that Labour had learnt the lesson in Crewe and Nantwich. They tried class war then and it backfired spectacularly.

We still think the Conservative Party would benefit from an earthier feel, however. David Davis' resignation left the Tory leadership looking slightly unbalanced. Eric Pickles is a grassroots favourite, an accomplished campaigner, a northerner and a great communicator. He should be appointed as Party Chairman at the earliest opportunity in order to blunt any Labour Bullingdon attacks. We look forward to a Pickles Express visiting key target seats throughout the election campaign. We'd quite like to be a passenger!

In recommending Eric Pickles for CCHQ we don't mean to disrespect Caroline Spelman. Behind-the-scenes she has done a good job for the party but a different frontbench portfolio might be better suited to her talents.

> Step 3/10: There must be room for forgiving-and-forgetting in Project Cameron

October 27, 2008 at 12:02 in CCHQ, Ten next steps | Permalink | Comments (29)

There must be room for forgiving-and-forgetting in Project Cameron

Over the nearly three years since David Cameron became leader a fair number of talented individuals have left the frontbench for a variety of reasons. We think of Graham Brady, Mark Field, Bernard Jenkin, Patrick Mercer and Hugo Swire, for example. One or two of them should be brought back. There is a great deal of talent within that group and it would also be unifying for the party leadership to show that it is willing to forgive and forget some past differences.

> Step 2/10: The Cameron circle needs to be bigger

October 27, 2008 at 11:08 in Frontbench, Ten next steps | Permalink | Comments (28)

The Cameron circle needs to be bigger

In many ways the 'big Conservative tent' is functioning again under David Cameron. Big beasts like Michael Heseltine, Ken Clarke, IDS and John Redwood were all used in the policy review process.

In other respects, however, Project Cameron is built around far too tight a circle. Frontbenchers complain that they are not involved in their development of their policy briefs. Very few of the party's big economic brains have been actively consulted by the leadership on the current challenges. The shadow cabinet rarely takes important decisions. ~~David Cameron has no equivalent of the Policy or Strategy Boards that ensured that MPs rather than advisers 'owned' the big political calls~~. 4.30pm: CCHQ has told us that there is a policy board. Its membership is:

William Hague
Oliver Letwin
David Cameron
George Osborne
Philip Hammond
Francis Maude
PLUS The relevant shadow cabinet minister when his/her policy area is under discussion.

Our apologies for that.

It is difficult to run a party and impossible to run a government when the leader's inner circle remains relatively closed to outside advice. We've worried about this before and it remains a problem.

> Step 1/10: Tories need to explain their macroeconomic strategy for the recession

October 27, 2008 at 10:07 in Frontbench, Team Cameron, Ten next steps | Permalink | Comments (18)

Tories need to explain their macroeconomic strategy for the recession

Despite Brown's second honeymoon period the Tory position in the opinion polls remains strong. The latest ConservativeHome Poll of Polls is still pointing to a majority of 70. There is no cause for strategic concern, therefore, but neither should there be any complacency. Over the course of today ConHome will be suggesting ten next steps for the Conservative Party.

Although George Osborne's 'Yatchgate' dominated last week's news the most important event was David Cameron's Today programme interview, given exactly a week ago. In that interview the Conservative leader decided not to change macroeconomic policy - an opportunity that the global crisis presented. Mr Cameron has effectively ruled out use of fiscal policy to beat the UK downturn - a policy Gordon Brown is set to commend today.

What the Conservative Party appears to be saying is that only by restoring discipline to the public finances will the Bank of England have the room to make large and sustainable cuts in interest rates. The Tory economic team has decided that further borrowing will make it harder for the Bank's monetary policy committee to make those cuts. It is not the policy that ConHome would have chosen (we are attracted to the Lilico plan of large but time-limited tax reliefs) but it is a credible policy and needs to be explained.

The Tories are currently offering some sensible policies to help, for example, small firms cope with recession but the policies are inadequate to the scale of the challenge. We need our Treasury team to 'get out there' and explain how their thinking on fiscal responsibility is most likely to reduce the costs of borrowing. It is not a sexy policy but it it needs to be heard.

October 27, 2008 at 08:54 in Economic Policy, Ten next steps | Permalink | Comments (30)

Chris Grayling proposes a "Dragons' Den" for the jobless

Writing in today's Sunday Times, Chris Grayling criticises the government's record and sets out some of the measures the Conservatives would take to encourage those who lose their jobs to start businesses of their own. The benefit would extend beyond them - the overall economy could be lifted with an "army of entrepreneurs". In the key paragraphs on the Conservative proposals, Grayling writes:

"We want a programme that empowers an army of “job makers” for the future, that helps create 20,000 new businesses a year and with them many thousands more new jobs.

"The programme would help people who have been made redundant and have been out of work for six months and have a clear idea for a business. They would get Dragons’ Den-style support from private sector specialists, helping assess ideas, offering advice on market research, business planning and how to get things going. Those specialists would be paid for that support when the business was established and the claimant was no longer dependent on benefits.

"The entrepreneurs would continue to receive jobseeker’s allowance for up to six months while getting their business off the ground. It takes that long to do your first deal and get the money paid.

"Every business start-up has a cost, and if you’re on the dole you can’t easily afford to buy basic equipment. At the moment the only start-up cash available from the “new deal” for unemployed people trying to start a business is £400. We don’t think that’s nearly enough, so we’ll give the business start-up specialists the ability to fund costs of up to £2,500, and then reclaim the money from the benefits saved once the business is up and running."

October 26, 2008 at 13:19 in Economic Policy, Welfare reform | Permalink | Comments (15)

Conservative frontbench reemphasises opposition to sharia law

Bridget Prentice, a junior minister at the Ministry of Justice has confirmed that Sharia councils will have the right to settle disputes between two 'consensual' parties, where they relate to money, property and access to children. By the letter of the law, these decisions and ruling will have no legal force. But in practice, where Sharia councils have ruled on a matter, English family courts will be now expected to rubber stamp their decisions.

Nick Herbert and Paul Goodman have both come out in strong opposition to this decision:

Nick Herbert, the shadow justice secretary, said: "There can be no place for parallel legal systems in our country.

"It is vital that in matrimonial disputes where a Sharia council is involved, women's rights are protected and judgments are non-binding."

Another Conservative spokesman, Paul Goodman, the shadow minister for communities and local government, accused the Government of keeping the public in the dark and warned: "There must be one British law for everyone."

Neither are quoted explaining why Sharia courts should not to be welcomed or why women's rights should be a concern in them at all. David Green of Civitas is however quoted noting that such courts do not consider the voice of a woman equal to that of a man, nor treat men and women equally under the law.

9.45am: In his speech last month to the Conservative Party Conference, Dominic Grieve made clear the Tory position:

"For all its tough talk on terrorism, the government is dropping the ball on security and radicalisation. Lax on fanatical preachers. Silent on sharia courts. Let me make our position clear. Sharia courts can be given no authority over criminal and family law matters in Britain. Our law must reign supreme. The next Conservative government will make sure it does."

October 26, 2008 at 07:07 in Race and multiculturalism | Permalink | Comments (24)

Michael Forsyth warns of Labour using nationalised banks for political purposes

Mark Field MP has already warned about the consequences of banning bonuses for those bank employees who are expected to lead the sector back to health. Lord Forsyth uses an article in today's Telegraph to warn of other dangers, including the worry that Labour might use its nationalisation of many of our banks for its own political purposes:

"The Government says it has no wish to interfere in the way they are run. If the banks are to be returned to health – and to private ownership – then there must be no political interference. Yet the Government is putting its representatives on bank boards, demanding that banks maintain 2007 levels of lending to homeowners and small businesses, putting caps on directors’ pay and hinting that it will intervene to halt repossessions. That’s already quite a lot of interference to be getting on with. With Labour behind in the polls and an election coming up, can we be sure ministers will not be tempted to meddle a lot more? What safeguards will Labour offer to ensure it does not use the nationalised banks for its own ends?"

It's a timely warning. Michael Forsyth worries that the devil is in the detail of the bank recapitalisation programme but (as Greg Hands MP has noted) Parliament still hasn't had proper opportunity to debate the terms of the Brown-Darling plan.

October 25, 2008 at 08:31 in Economic Policy | Permalink | Comments (9)

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