Having reshaped his Cabinet substantially last summer - sacking two Cabinet Ministers in the process - David Cameron is unlikely to do so again during this one. This is because to do so would both risk destabilising his already fractious Parliamentary Party, and offend his instinct to keep changes to his front bench to a minimum. From the Prime Minister's point of view, it makes sense to delay a substantial Cabinet clearout until next summer, when a team can be put in place to fight the election in 2015.
Leaving the next big shuffle until later in the Parliament will also minimise any backlash from sacked Ministers, since they will rally round Cameron during the election run-up (that's the theory, at any rate). The claim that Sir George Young will stay in post for the time being would dovetail with such an approach. The Prime Minister's most likely reshuffle course, therefore, will be to restrict change to the lower ranks of the Government - but to promote to just below Cabinet level men and women who, in his view, are capable of making it to the top table next year.
By Tim Montgomerie
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Here is a selection of the arguments that Tory MPs made during yesterday's debate on limiting the increase in benefits to 1% for each of the next three years.
The Government's overall policies help those on low incomes: "The Opposition have argued that this uprating of 1% will impact on working people and not just those on benefits. Given that the previous Government made 90% of workers eligible as welfare recipients, that is inevitable. Unfortunately, Labour Members make the mistake of taking these measures in isolation. If we take the Government’s measures as a whole, including tax allowances, energy tariff changes and cutting petrol duty, low-income working households will be better off." - Aidan Burley MP
And the biggest burden of deficit reduction is being met by the better off: "I want to remind the Opposition of what they have done. They have opposed £83 billion-worth of savings this Parliament. That is equivalent to adding another £5,000 of debt for every working family in the country. We hear much about taxing the rich, yet, in this Parliament, the richest will pay more in tax than in any single year of the previous Government—more tax on capital gains, more stamp duty—they will be less able to avoid and evade tax and they will pay more when they take out their pension policies." - Iain Duncan Smith MP
Stop taxing people only to return that money via the benefit systems: "Is not the philosophical underpinning of this debate our wish to create a hand-back society, not a hand-out society? Is not cutting taxes on lower earners the best way to help those on low earnings, rather than recycling their hard-earned money through the benefits system?" - Robert Halfon MP
Fairness between those in work and those out-of-work:
By Matthew Barrett
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Conservative Friends of Israel is an influential affiliate group of the Conservative Party which contains perhaps the largest number of Conservative MPs of any group in Parliament. It exists to promote understanding of and support for the State of Israel in the Conservative Party, and its membership reaches the highest echelons of power, including the Foreign Secretary, William Hague. In this profile, I examine its origins, membership, role, and activities.
Origins of the group
Conservative Friends of Israel (CFoI) is the oldest group of Conservative MPs I have profiled so far: it was founded by Michael Fidler, who was the Conservative Member of Parliament for Bury and Radcliffe between 1970 and the October 1974 election. After losing his seat, he decided to focus on building a pro-Israel group within the Conservative Party - there had been a Labour Friends of Israel group since 1957 - so Fidler launched CFoI in 1974, and served as its National Director.
Sir Hugh Fraser served as the first Chairman of CFoI, from 1974. Sir Hugh was a Conservative MP of the old school: after a distinguished military intelligence career in the Second World War, he entered Parliament in 1945, and he missed out on being Father of the House to James Callaghan in 1983 by only a few days. Sir Hugh had an interest in oil and the Middle East and served a number of positions in the War and Colonial Offices, before entering Cabinet as the Secretary of State for Air in 1962. He might be best known to some readers as the outsider candidate who came third in the 1975 party leadership contest, behind Mrs Thatcher and Edward Heath, gaining only 16 votes.
By Matthew Barrett
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The 301 group is perhaps the most active and important group of backbench Tory MPs. Tim Montgomerie reported last week that three MPs - Charlie Elphicke, George Hollingbery and Priti Patel - want to organise a candidate to be elected to the 1922 Committee's executive who will give the '22 a focus on policy and campaigning. The Spectator's James Forsyth blogged that "The vote for their candidate, and his opponent, will give us the best idea yet of where the backbenches are at the moment politically. Indeed, I expect that the machinery of the 301 group, the most pro-Cameron of all the backbench groups, will be thrown behind the Elphicke-Hollingbery-Patel slate."
To organise or endorse candidates for the '22 is certainly the most power a backbench group has yet wielded in this Parliament. In this profile, I'll be looking at the origins, members, aims and plans of the group to get a sense of what the group wants to campaign for.
Origins of the group
The 301 was first organised by Kris Hopkins (Keighley), a former soldier and leader of Bradford Council, and Jessica Lee (Erewash), a former barrister, and now Parliamentary Private Secretary to the Attorney General, Dominic Grieve. The group began with small meetings of a handful of MPs who were "concerned that the narrative in Parliament was not representative of the conversation" that MPs had had with the electorate while campaigning during the 2010 general election, and also dissatisfied with the fact that the mechanisms of debate amongst backbenchers, and between the back and front benches, were not conducive to trying to correct that narrative. Each of those attending brought a friend, and so on, until after three meetings the group reached 60 members.
By Joseph Willits
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Yesterday, Jessica Lee MP (Erewash) secured a Westminster Hall debate on the issue of adoption. Adoption levels in the UK, she said "should cause alarm bells to ring" after only 60 children out of 3,660 in care were placed in homes. Lee said it was crucial to "seize the opportunity", and described the "momentum in the House and the country to tackle the challenges affecting the adoption process".
Lee drew on both the experiences of Michael Gove (who discussed how adoption "transformed his life" in the Daily Mail), and Cameron's commitment to making the "process of adoption and fostering simpler". Richard Graham (Gloucester) praised the Government for "showing real leadership on the issue of tackling these problems".
In response to Lee's question at PMQs on 2nd November, Cameron said the adoption process had "become too bureaucratic and difficult, and the result is that it is putting people off. I am absolutely determined that we crack this".
by Paul Goodman
Stephen Hammond (Wimbledon) returned to Labour's debt legacy -
"The shadow Chancellor was wrong blindly to dismiss what is happening in the gilt markets. I read the yield curve this morning, just as he did, and it is clear that 10-year gilts yields are low at the moment. If the market believed that the Government’s debt reduction plan was going to change, those yields would undoubtedly rise and the cost of borrowing would rise substantially from £120 million a day, ruling out any prospect of more of the things that we really want to spend public money on. Labour Members shouted out, “Too fast, too deep,” yesterday, but they should remember that there are risks involved, and that theirs is an equally dogmatic strategy.
The shadow Chancellor, in contending today that the changes were too fast and too deep, once again relied on the Keynesian multiplier. He is an eminent economist, and he should know better than to rely too heavily on that mechanism. It has traditionally held out the prospect that public sector investment has an impact on the private sector, so there could be an element of crowding out and of limiting of growth potential. If the right hon. Gentleman has read the recent academic research, however, he will also know that the size of the multiplier in the growth phase of an economy is about a third of the size of the multiplier when an economy is going into recession. To rely on that thesis is therefore to rely on a very weak economic mechanism."
Sam Gyimah (East Surrey) drew on his business experience -
The hon. Member for Coventry North West (Mr Robinson) mentioned bank lending, but fast-growing companies’ revenues are often volatile and their cash flows can be unpredictable. Banks do not want to lend to them, so we need to be able to create an environment for equity lending. One thing we know in the UK is that, if people want to raise amounts below £2 million, they find it incredibly difficult to do so. Such risk capital, however, encourages businesses to take a risk—to take on the new plant, to hire new staff—so it is great that there are so many changes to the enterprise investment scheme in “The Plan for Growth”.
Increasing relief to 30% means that someone who is going to invest in a business knows that they can offset 30% of their investment against tax. It will encourage people to take sensible risks and invest in those companies that will drive growth. Raising the relevant annual limit to £1 million and to £10 million per company means that companies can seek capital from high net-worth and private individuals, not just from institutions. Anybody who is involved in small businesses knows that people often rely on friends and family to support their business in its early stages, so it is good to see the Government backing those who are ready and willing to take such risks.
Raising the limit on qualifying companies to 250 employees means that the measure will apply not just to start-up companies, where the failure rate can be quite high, but to well-established companies that need capital to grow. I would like to see what more the Government can do to allow connected persons to enjoy such tax reliefs, because connected persons—directors—cannot enjoy them at the moment, and that is where businesses get much of the expertise that they need. By making investment in small businesses easier, the Budget recognises and encourages people who are willing to take risks."
And Julian Smith (Skipton and Ripon) also spoke about business -
"The most exciting aspect of yesterday’s Budget was the direction of travel the Chancellor set in respect of the conditions for business that he wants in Britain, because growth will ultimately be achieved through the individual efforts of business leaders, not through Government. The 2% cut in corporation tax signals to companies that Britain is once again open for business. It is now clear to every potential investor, in the UK and overseas, that this Government are committed to putting in place the best corporation tax rates in the G20 by the end of this Parliament. Overnight, global companies such as WPP have said that that will make a difference to their decisions on where to invest. That is great news.
The Budget also encourages those who want to set up a business to go for it. It contains a big nudge from the Government for people to give entrepreneurship a go. There is a golden carrot to dangle before those thinking of taking a risk: a 10% capital gains tax rate up to £10 million. The profit motive is a motivator, and the Budget clearly says, “If you believe in your business, take the risks and are successful, you will be much better off financially.” Therefore the message is, “Unless you’re a cracking singer or can dance like the Business Secretary, forget `The X Factor’ and `Strictly’; this Budget gives you a golden ticket to join start-up Britain.”
The moratorium on new legislation for small businesses with fewer than 10 employees will be a big relief for entrepreneurs, who need to be fully focused on jobs and growth rather than the latest wheeze from Whitehall. When I was a small business owner, dealing with employment law took more time than any other management responsibility. Employment laws and regulations have been piled on British business since 1997."
Michael Fallon (Sevenoaks), a Party Deputy Chairman and Select Committee member, decided to make constituency points to illustrate his general ones -
I am struck in my constituency by how many companies succeeded in growing even under the previous Government, without direct subsidy or specific grants. I visited three recently. The Sevenoaks energy academy, which I had the honour of opening last year, trains hundreds of engineers in renewable energies, providing courses in fitting solar panels, rainwater harvesting and so on. One of Sevenoaks's most dynamic business women, Julie Walker, made a £1.5 million investment in that academy, and I welcome that.
Michael Fallon: I will not, if the hon. Gentleman will excuse me. Secondly, Vine Publishing is a new media company in my constituency, which is heavily involved in all kinds of print and digital work. Its turnover now approaches more than £3.25 million and it employs 12 people. It was founded by three entrepreneurs, who dropped out of university because they preferred to go into business.
Thirdly, I attended the opening of the Ideal Waste Paper Company this month. It has built a major new recycling facility at Swanley-a £14 million investment, creating 60 new jobs and recycling more than 250,000 tonnes a year.
Those are examples of companies of the future, in the new technologies, the new energies and the new media. We should all ask ourselves how we get more of them. Of course, getting the long-term climate is right, but we must also address how to make it easier for people to set up such companies."
As did Jessica Lee (Erewash) -
"I was particularly delighted to hear the announcement about the establishment of an enterprise zone for Derbyshire and Nottinghamshire. My constituency is right in the heart of that area, and I will do my best to ensure that we are its beating heart; I will fight for an appropriate level of investment. We also have some of the centres of innovative manufacturing that were announced yesterday, at Loughborough university and the university of Nottingham. Again, many young people in my constituency could benefit from that training and help, and I will do all I can to make those facilities available to them.
The enterprise zones will follow the structure set out in the local enterprise partnerships. We were lucky to have a strong LEP application for Derbyshire and Nottinghamshire from the outset, and it was one of the first to be accepted. That group is already taking great steps towards being up and running, so that it can take in bids and bring in investment and jobs. I think that the enterprise zone will assist in that even further.
Finally, the freezing of council tax will benefit hard-working families in my constituency. We are lucky in Erewash because this is the second year running in which the borough council has frozen council tax. That will really help people."
Here are excerpts from four more maiden speeches delivered during Thursday’s debate on poverty.
“It is not just one thing that needs to change. Low income, family breakdown, addiction, mental health problems and criminal behaviour contribute to a lack of expectation that, in turn, leads to inactivity. Charities find themselves too small to help; agencies find it too difficult and authorities find it too expensive. Complex problems may require multiple solutions, but unless we invest our time, energy and support, deprivation in parts of one of the most advanced countries in the world will continue to blight our nation.
“I have heard many maiden speeches over the past few weeks, and the one thing all new Members share is the desire to make a difference. While I am in Parliament, I want to accomplish many things on behalf of all my constituents, but I hope that improving the plight of the poorest will be my greatest achievement. The Government must of course cut the deficit, but our legacy must be to reduce the dreadful levels of poverty and give every person in my constituency and throughout the country the standard of living they deserve.”
“First, I wish to say a quick word about international poverty. As a former ambassador for ActionAid, I believe that whatever economic difficulties we face nationally, we must not neglect our responsibilities as a civilised nation to act to reduce world poverty. Hunger kills 3.5 million children every year—one every 10 seconds—and we must do all we can to end it.
“Even closer to home, we have issues of poverty to tackle, and that is even more important now than ever before. I see that in areas across my constituency. Currently, 2.9 million children are living in poverty in this country, which prevents them from having the fair start in life that all children deserve. We will work to change this. I agree with the Minister of State, Department for Work and Pensions, my right hon. Friend the Member for Epsom and Ewell (Chris Grayling) that our first task is to ensure that we give children the best education possible and give them the skills that will make a real difference to their lives. After that, it is about cutting the deficit and creating jobs for the future, so that we can create a strong and stable future for us all.”
David Nuttall, who gained Bury North from Labour spoke with the hinterland of a working-class background in the “Socialist Republic of South Yorkshire” and concluded that there was no reason why anyone should be categorised as living in poverty:
“I note that nowadays poverty comes in all sorts of technical categories. We have “severe” poverty, “relative” poverty, “absolute” poverty and “persistent” poverty, but it seems to me that, with our welfare system and the vast amounts that we spend on welfare in Britain today, there is no reason why any of our fellow citizens should be categorised as living in poverty. It is incumbent on us all to look at how we are spending our welfare budget. It is the poverty of aspiration and ambition, which is so pervasive and widespread among many in the lower socio-economic groups, that is the real problem. In that regard, I hope that perhaps my achievements can be an inspiration to others.”
Finally, Jessica Lee , the new MP for Erewash – who has legal experience in this area, as well as having worked with the Centre for Social Justice – offered her services to Frank Field as he reviews these matters:
“I applaud my right hon. Friend the Prime Minister’s recent announcement that there will be a review on poverty in the UK and how the state can assist the least advantaged. The whole House benefited from the contribution to the debate made by the right hon. Member for Birkenhead (Mr Field), who will lead the review, and I look forward to assisting in any way that I can.
“Agencies working together locally to assist families is the key to fighting poverty. The reality is that the state cannot and should not seek to provide all the answers to this complex problem by itself. We have a dedicated voluntary sector with many large and small charities that help disadvantaged families in the UK. Further steps to enable the third sector to work hand in hand with social services and adult services are to be encouraged.
“Before I was elected to the House, it was my privilege to work as a lawyer specialising in cases concerning children and their welfare. The consequences for children of a life in poverty were all too clear to see in my daily work. Family breakdown, substance misuse, personal debt and educational failure can all too easily follow, and the consequences for children can be far-reaching and devastating. I will contribute in any way that I can to the ongoing debate on protecting children and ending the cycle of poverty that can perpetuate.”