By Tim Montgomerie
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Most Tory MPs were relatively positive about what Vince Cable said yesterday afternoon about executive pay. A couple, however, were indignant and a little bit silly...
Philip Davies: "I have heard some drivel in my time, but I do not think that in all my years in opposition I heard as much drivel from the Treasury Bench as I heard from the Secretary of State today."
Peter Bone: "The liberal, left-wing clap-trap that he has announced today—which even Labour did not do, in 13 years—has somehow got through the coalition in the hope of a good headline."
Both interventions strike me as knee-jerk libertarianism and they ignore the important role that law plays in setting the rules of the free market game.
By Joseph Willits
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In yesterday's Adjournment debate before the start of the Christmas recess, a mix of topics were raised by MPs.
Chris Skidmore MP (Kingswood), who also wrote on ConservativeHome yesterday about making history a compulsory subject for under-16s, spoke of the study of history reaching a record low. Skidmore said that "in 77 local authorities fewer than one in five pupils is passing history GCSE". Despite these figures already being low enough as it is, there was a need to break them down, he said, "because in places such as Knowsley under 8% of pupils are passing history GCSE".
"Often it is the Daily Mail or academics who discuss what type of history should be studied in schools, whose history should be studied, how history should be studied in the curriculum, whether we should have a narrative form of history or a more interpretive form of history that looks at sources, and whether history should be seen as a framework of facts."
Whilst this debate was important, he warned of history "becoming a subject of two nations" and Britain's isolation in Europe, if people were not united in the view "that history is a crucial subject that binds us as one nation".
By Joseph Willits
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Zac Goldsmith would rather be known by the term "effective backbencher", than "rebellious backbencher". In a BBC Hardtalk interview today with Zeinab Badawi, rebellion and party dissent over Europe and the environment, proved to be the main focus. Although critical of the Government over its handling of an EU referendum, Goldsmith insisted that he remained loyal to the party:
"I have voted with my party more than 90% of the time ... if that is anything other than loyal, then I think we need to rethink those terms"
However, Goldsmith indicated his delight for fighting political causes and holding the Government to account as a backbencher, rather than in the "hellish existence" of a junior minister. "I didn't stand for election in order to have a lobotomy and to be programmed by a party leader", he said.
Goldsmith defended the Government on environmental policy, saying it had been "unfairly chastised" and that "twice as many environmental commitments as anything else ... [are] being delivered". He praised both the Green Investment Bank, saying it was "a step in the right direction", and the Green Deal. Although the Government was "beginning" to understand the priority behind environmental policies, he said, the Green Investment Bank, however, was "not big enough, or soon enough", and it was essential that Treasury got "behind... and turbocharged" the Green Deal.
By Joseph Willits
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David Morris, MP for Morecambe and Lunesdale, is set to call for a change in the law on Wednesday, making it compulsory for all hairdressers to be state registered. A Bill under the Ten Minute Rule to amend the Hairdressers (Registration) Act 1964, will be introduced.
Morris, who has 28 years of hairdressing experience in Wigan and Bolton, before becoming an MP, has previously warned of the "wrong" and "dangerous" implications of unlicensed hairdressers:
"At present anybody can just open a hairdresser's shop and go about cutting and dying people's hair using corrosive chemicals without any training or licensing."
Drawing from his own experiences as a hairdresser, Morris said:
"When I ran salons I had people coming into me with pink and blue hair and scalp burns and hair snapping off at the root, and we'd have to sort them out because they'd had their hair and skin damaged by cowboys who don't know what they're doing".
By Matthew Barrett
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John Hayes, the Minister of State for Further Education, Skills and Lifelong Learning, is responsible for one of the unmitigatedly good things the government is doing: creating hundreds of thousands of apprenticeships.
At Business Questions on Thursday, Mr Hayes was in fine form, decrying the "whiners and whingers" who seek to play down the successes of the government in this area:
"The hon. Gentleman is right that there has been a growth in over-25s apprenticeships and he will know that the previous Government commissioned the Leitch report, which said that that was exactly what we needed—to upskill and reskill the work force. Notwithstanding that, however, he will also know that there has been remarkable, unprecedented growth in 16 to 18 apprenticeships and in 19 to 24 apprenticeships over two years. Contrary to the complaints of the carpers and the cringers, the whiners and the whingers, the biggest proportion of growth has been at level 3—that is A-level equivalent."
By Tim Montgomerie
Sat alongside David Cameron, Nick Clegg and George Osborne, Business and Universities Secretary Vince Cable has just told the Commons that the Coalition government endorses the "main thrust" of Lord Browne's recommendation to lift the cap on tuition fees although it will not yet bring forward specific proposals.
He said that the Coalition would remain opposed to up-front fees and he welcomed Browne's recommendation that part-time students should also be exempted from up-front charges.
Mr Cable said he warmed to Browne's recommendation that higher earners pay a real interest rate on their tuition fee loans and no graduate should begin to start repaying until they earn £21,000 (the current threshold is £15,000). 20% of graduates would pay less as a result, he said, and the top third would pay more than twice as much as the lowest third. This, he said, met his hope for a progressive graduate contribution.
He said that the target of 50% participation in universities was "misguided" and he argued that an apprenticeship could be just as valuable as a degree; "if not more".
In this current fiscal environment the Liberal Democrats' opposition to tuition fees was "no longer feasible".
For Labour, new Shadow Business Secretary John Denham said that teachers, engineers, middle managers and women would suffer most from higher interest charges because the poor would be protected. Some, he said, would still be paying off their tuition fees when their own children started at university. Despite taunting from Mr Cable he declined to say if he supported Ed Miliband (who has advocated a graduate tax) or Alan Johnson (who opposed a graduate tax, at least until he became Shadow Chancellor).
This huge subsidy of the union movement was uncovered by Lord Ashcroft.
"To ask Her Majesty's Government whether they have given funds to the Trades Union Congress; and, if so, how much in the past five years."
Baroness Wilcox, a BIS minister, answered:
"The Government provide funding to the Trades Union Congress (TUC) to support a number of programmes but do not keep a central record of expenditure. The main sources of direct government funding over the past five years have been from the Department for Business, Innovation and Skills and the Department for International Development. The Department for Business, Innovation and Skills provided funding to the TUC for the Union Learning Fund (ULF) and unionlearn, the TUC's learning and skills organisation, to support trades unions in working with employers to raise skill levels in the workplace. The department also provided funding via the union modernisation fund and strategic partnership fund to support modernisation projects to help trades unions respond to technological, economic and other changes in the workplace. The total amount of funding provided from 2005-06 to 2009-10 in respect of these programmes was £69.8 million. The Department for International Development provided funding to the TUC to support the Partnership Programme Arrangement and the Strategic Framework Partnership Agreement. The total amount of funding provided from 2005-06 to 2009-10 was £2,186,780."
On Friday Labour MP Lindsay Hoyle's Statutory Redundancy Pay (Amendment) Bill had its second reading. It calls on the Government to "link the value of statutory redundancy pay limits to the level of average earnings, which will ensure that future increases in statutory redundancy pay are linked to average earnings". Mr Hoyle explained that:
"The amount of statutory redundancy pay to which an employee is entitled depends on his or her age and length of service and pay. An employee who has been employed continuously for more than two years is entitled to half a week’s pay for each complete year of service between the ages of 18 to 21, one week’s pay for each complete year of service between the ages of 22 and 40 and one and a half week’s pay for each complete year of service after reaching the age of 41. There is, however, a statutory cap on the amount of employee’s weekly pay that can count towards the entitlement to statutory redundancy pay. Since February, the limit has been set at £350."
The Bill had 85 Aye votes and 17 No votes, although it is not supported by the Government. Jonathan Djanogly, Shadow Minister for Corporate Governance and Solicitor General, spoke for the Conservatives:
"I am sure that the hon. Member for Chorley (Mr. Hoyle) honestly believes that his Bill will help employees, but from the Opposition’s point of view it is, at best, an inappropriate reaction to the crisis that we are facing. Moreover, we are extremely concerned about the damaging effect that it could have on workers in the longer term. In diverting money away from the running of businesses, which could lead to more insolvencies, the Bill could undermine and damage the very workers whom it seeks to protect. Whether or not it is a panicked reaction to the financial crisis, I state now that we do not support this Bill.
Providing help to working people in this country means making sure that we have an economy that will create and sustain jobs, and that includes getting credit moving in a way that this Government are consistently failing to do. We simply believe that this proposal would be damaging to our economy, to our companies and to the workers who drive our economy.
We are hugely concerned that, in this economic downturn and with unemployment already predicted to rise to 3.5 million, this diversion of cash will only add fuel to the fire. Essentially, the Bill could damage those whom it seeks to protect. Although some redundant staff will enjoy a short-term monetary gain, it could also have negative effects. First, the additional financial strain on companies could lead to more businesses becoming insolvent, so there could be fewer businesses to offer jobs once the economy begins to recover and, perversely, there could be more workers to compete for those limited job opportunities.
Wellingborough MP Peter Bone introduced an Adjournment debate on Friday. The subject was Alfred Sargent and Sons Ltd, a shoe manufacturer who have had to lay off 40 staff. Their redundancy payments have been severely delayed, and Mr Bone sought a change in the law to speed matters up.
Mr Bone told the Commons:
"It is not my intention to blame the Government for what I see as a gap in the national law. If a Conservative Government were in power today, I would still rise to press this issue. It is not party political; there is a gap in the law and it needs to be put right. The issue involves 40 hard-working men and women who lost their jobs in December last year and have been out of pocket ever since through no fault of their own; they are still out of pocket.
Early in December last year, I began to receive complaints from constituents who had been employed by Alfred Sargent and Sons Ltd in Rushden. They had been made redundant, but had not received any redundancy payments, although the company continued to trade. Losing one’s job is hard enough, but not receiving redundancy payments was very worrying for the people who had contacted me, particularly as it was just before Christmas. The situation was covered extremely well by my excellent local newspaper, the Northamptonshire Evening Telegraph, which kindly published an article reflecting my concern and suggesting that affected workers should contact me directly.
I want to make very clear that I make no criticism whatever of Alfred Sargent and Sons Ltd, its board of directors, or any of its work force. The company was faced with an extremely difficult Catch-22, and dealt with it as best it could. At the end of the story, there is some good news: Sargent’s has streamlined and continued to trade, and I understand that its prospects of success are extremely good. My aim today is not to criticise the company, but to expose a loophole in the law. Nor do I intend any criticism of the Government, who may well not have been aware of the loophole."
There was an Opposition Day Debate on the Royal Mail in the House of Commons yesterday. Shadow Business Secretary Ken Clarke moved:
"That this House welcomes the Hooper review of UK postal services; and urges the Government to implement rapidly the review’s proposals for the partial privatisation of Royal Mail."
But despite this support from the Conservatives a Government amendment was drafted, stating that the House:
"“notes the threats to the future of the Royal Mail and welcomes the conclusion of the Hooper Report that, as part of a plan to place the Royal Mail on a sustainable path for the future, the current six days a week universal service obligation (USO) must be protected, that the primary duty of a new regulator should be to maintain the USO, and that the Government should address the growing pensions deficit; notes that modernisation in the Royal Mail is essential and that investment must be found for it; endorses the call for a new relationship between management and postal unions; urges engagement with relevant stakeholders to secure the Government’s commitment to a thriving and prosperous Royal Mail, secure in public ownership, that is able to compete and lead internationally and that preserves the universal postal service; further notes the Conservatives’ failure to invest in Royal Mail when they were in power in contrast with Labour’s support for both Royal Mail and the Post Office; and notes that legislation on these issues will be subject to normal parliamentary procedures.”
Two Conservative MPs - Daniel Kawczynski (Shrewsbury & Atcham) and Edward Timpson (Crewe & Nantwich) - voted against the Conservative motion - and then abstained on the Government amendment.
Last October Mr Timpson slammed the Royal Mail for its proposals to transfer around 460 jobs from Crewe to Warrington. Mr Kawczynski recently gave staff from the Shrewsbury Royal Mail sorting office a tour of the Palace of Westminster before holding a surgery with them.
Update: Mr Kawczynski told ConservativeHome:
"After four years in Parliament and never having voted against my party, I felt I had to in this case. I am in favour of the Post Office remaining in state hands and will not vote for any measure which would wholly or partly privatise it. I have a regular meetings with staff at the huge sorting office in Shrewsbury, which covers Shropshire and a large part of Wales. I have a special strong bond with the workers at the sorting office and I will do everything I can to protect their jobs. I think that privatisation could lead to job losses there, and that's one of the reasons I voted the way I did."
Further update: Mr Timpson has given ConservativeHome the following statement:
"Crewe sorting office has been earmarked for closure, with little consultation from Royal Mail. This will result in a loss of up to 600 local jobs, with the majority of staff unable to relocate. The impact on both them and their families at a time of recession would be devastating. They do not oppose modernisation of their industry. Like them, I have found Royal Mail managers and the Minister for Postal Affairs to be disinterested and dismissive rather than concerned with the plight of workers at this time of recession. They have used the Hooper Report as an excuse to retrospectively justify their behaviour. I cannot therefore welcome a report that is being used as a stick with which to beat the third largest workforce in my constituency. They deserve better than the atrocious treatment they have received."
Shadow Business Secretary Ken Clarke was up again in the House of Commons yesterday. He is of course not able to question his opposite number Lord Mandelson in the chamber.
He asked about the enterprise finance guarantee scheme, which was launched last month and is open to businesses with a turnover less than £25 million. Companies will be able to borrow between £1,000 and £1 million. Loans can be repaid over up to ten years.
Mr Clarke swung into action:
"When Lord Mandelson announced the scheme, he said that it was “going live today”, and the Minister has just said that it is open for business—but does he not realise that he is lucky if he has found a small business that is aware of the existence of the scheme, and very lucky if he has found a bank that believes that it is operating the scheme at local level? Instead of producing a series of measures in a panic-stricken way, as the Government have done in recent months, would it not have been better if they had speedily adopted our policy of a £50 billion loan guarantee scheme for businesses of all sizes, and had shown some competence in getting it into practice at the speed required?
Ian Pearson: No, it would not have been a good idea to implement an uncosted, untargeted scheme. What the Government have done is to introduce the enterprise finance guarantee, which is specifically targeted at companies with a turnover of up to £25 million. The right hon. and learned Gentleman will be aware of the working capital scheme that we are also introducing. It will provide working capital support for businesses in the economy. That will apply to a portfolio of companies with a turnover of up to £500 million. That is real support for business, and it is working. We need to do more to market existing products to the business community. I would like to think that the right hon. and learned Gentleman and I shared an interest in wanting to do that, and in wanting to get the maximum possible publicity for the real support available to companies to help them through the recession."
I must say that while I wasn't too sure, it is good to have Mr Clarke's debating skills back on the front bench and in frontline politics.
We were promised that he is still a formidable operator, and yesterday Ken Clarke showed his mettle at the despatch box. Responding to the Government's announcement (made in the Commons by Lord Mandelson's deputy Ian Pearson) that it will make up to £2.3 billion available in loans, Mr Clarke said:
"May I begin by thanking the Minister for welcoming me to my new position? I think I have debated matters upstairs in Committee with him twice in the past six months, so I am used to his courtesy and competence, and I look forward to our exchanges.
I am grateful to the Minister for his courtesy in repeating to this House the statement made a few moments ago by the Secretary of State in the upper House. I actually think it is a constitutional outrage that it is being done in that way, and that it is a very poor way of accounting to the House of Commons, but at least we have been given the details of the package, such as it is.
May I say that I am slightly disappointed? I thought that the Secretary of State, whom I am shadowing, would produce some new ideas and some dynamite. He has been trailing a massive programme of support for the automotive industry, but unfortunately the Minister has had the task of producing pretty small beer. Is it not the case that the Secretary of State is not producing a bail-out because the Treasury has finally won an argument inside the Government and explained to him that it cannot afford the kind of support for the industry that, it seemed to me, his Department was trailing over the weekend?"
We'll have to wait and see whether this loan arrangement does indeed end up being a bail-out.
Shadow Business Secretary Alan Duncan put pressure on the Government yesterday. He excoriated ministers both for leaking their announcement on loan guarantees to the media (before coming to the Commons) and for adopting a pale imitation of the Conservatives' proposals.
The fact is that Mr Duncan is an extremely talented operator. He is forensic and devastating in debate, be it on television or in the chamber. He is also genuinely funny, and that skill should not be deprecated - given that it enables him to win over an audience.
The questioning of his energy levels and commitment seems pretty unfair to someone who has seen Mr Duncan working at close quarters. He is a very good politician, and would make a fine minister.
Mr Duncan is at fault for one thing however. Yesterday was not the time to raise economic questions. It was in fact my birthday, and business in both houses should therefore have been devoted to talking about me. Oh well. His words follow.
Business Secretary Lord Mandelson (as we must learn to call him) made a statement to the House of Lords yesterday. Apparently the Government's plans have led to the resignation of Jim McGovern as PPS to Pat McFadden, a minister who works under Mandy - sorry, Lord Mandelson.
Lord Mandy (there, that's a compromise) outlined the Government's plans for partial privatisation of the Royal Mail:
"We will fulfil our manifesto commitment to,
Bringing in a partner through a minority stake in the Royal Mail’s postal business will help us to deliver that goal. It will bring the Royal Mail fresh investment and new opportunities to grow in Europe and internationally, and to offer new services. It will provide a fresh impetus to modernising the Royal Mail and securing the universal service. We and the Royal Mail have already received one expression of interest from the Dutch postal company, TNT, to build such a partnership. I very much welcome this approach from an experienced postal company, just as I will welcome other expressions of interest from credible partners, should they come forward. My department will pursue this in the coming weeks."
Lord de Mauley (aka Rupert Charles Ponsonby, which is a SUPERB name) responded on behalf of the Conservative front bench:
"Royal Mail’s working practices are inefficient, competition is intensifying, industrial relations are poor and sorting machinery is outdated, while the fixed price of a stamp and a huge pension deficit seriously limit room for manoeuvre. All this has been clear for a decade, but for all that time the Government have done nothing to curtail a precipitous decline in Royal Mail’s fortunes.
Today we learn that the Government are trying to strike a desperate deal to see them through the next election. They are trying to look like the saviour of Royal Mail but are doing so in a barely disguised breach of their election manifesto. Even though his own party will not do so, we broadly welcome the Secretary of State’s intention to introduce a new commercial partner. It is a step in the right direction, although the details remain unclear."
What do ConservativeHome readers think the future should hold for the Royal Mail?
Shadow Business Secretary Alan Duncan doesn't get to quiz Lord Mandelson directly in Parliament, because they sit in different Houses. Instead Pat McFadden, a minister of state, represents the Department for Business, Enterprise and Regulatory Reform in the Commons.
Yesterday Mr Duncan, who is a formidable debator, piled on the pressure:
"The real truth is that businesses are increasingly desperate because their credit lines are drying up, the cost of borrowing has increased dramatically and credit insurers are refusing to underwrite the payment chain. Surely the Minister would agree that the recapitalisation of the banks has not yet filtered adequately, if at all, into the real economy. Why, then, has he chosen to reject our clear policy for a national loan guarantee scheme that would augment and underpin credit lines in a way that no Government policy yet does—or is he really saying that the Government have no ideas of their own and are simply rejecting it because it has on it the label, “Not invented here”?
Mr. McFadden: We announced a loan guarantee scheme in the pre-Budget report, based on a balance of risk sharing between the Government and business. As far as the hon. Gentleman’s proposal is concerned, as I have already said, the Conservatives have not made clear what proportion of the loans would be underwritten or what balance of risk will be shared between the Government and the lenders. It is important that proposals in this area are properly costed. That is what we have done and if further action is needed to help small businesses, we will not hesitate to take it.
Alan Duncan: But one thing the Government could definitely do to extend credit to businesses is to let them delay their VAT payments. Yesterday the Prime Minister said at Prime Minister’s questions that that was his policy and it should happen, but businesses are saying that, in fact, they are not being allowed to do that because Her Majesty’s Revenue and Customs says, among other things, “Oh no, it would give such a company a competitive advantage.” How can the Minister reconcile what the Prime Minister says one day with what is actually happening on the ground, and what instructions—what clear instructions—have the Government given to HMRC about the deferral of businesses VAT?
Mr. McFadden: The Chancellor announced in the pre-Budget report that HMRC would, on a case-by-case basis, allow businesses to spread their tax and VAT payments over a longer period of time. It is not the case that they have all been refused, as the hon. Gentleman claims that they have. It is judged, as I said, on a case-by-case basis.
In terms of policy—I know that the Conservatives like a leak—perhaps I should draw attention to the hon. Gentleman’s approach. I have an e-mail to him from his colleague, the hon. Member for Hertford and Stortford (Mr. Prisk)—
It looks like the Speaker has had enough of a certain subject!