Alex Deane: Our defeat in Europe over bankers' bonuses is a disaster for the City

Alex Deane is Head of Public Affairs at Weber Shandwick. Follow Alex on Twitter.

We now know that a cap on bankers' bonuses will be imposed by our European friends, against the UK's wishes. Whilst our government has seen some very welcome recent successes in Europe, I fear that this news outweighs those gains in no uncertain terms.

Even if the idea was right in principle, which it isn't, it falls down given the all-too-obvious point that the EU doesn't control global banking (thank goodness). Other banks will be able to pursue a more free market approach, whilst EU banks will now be competing with one hand tied behind their backs. In short, this measure gives a competitive advantage to banks headquartered outside Europe. Bankers working for EU-headquartered banks in Singapore or Zurich or New York will be handicapped in a way that their market competitors will not. The effect on their performance will be obvious. If your labour can command better remuneration elsewhere (and not in another country, but across the street!), then you'll go. It is simply daft.

Alex Deane and Jason Groves: It's time to eliminate the penny coin

It’s time to eliminate the one penny piece and two penny piece from circulation. In fact, it’s well past time.

Good old British inertia and vague nostalgia has meant that nothing’s been done about the obvious fact that we have coins of little and diminishing value in circulation which ought logically to be withdrawn. While you may experience understandable irritation from the collections of coppers we all accumulate, think for a moment about the wider costs to the taxpayer from continuing with these little beggars.

There’s the cost to the state of purchasing the materials which go into the coins, which is not insignificant; famously, in the USA the materials used to make a penny cost more than a penny, and the same problem has led to Canada eliminating the penny this month.

There’s not only the cost of purchasing the materials and then preparing and minting the coins; there's also the costs of transporting and introducing them into circulation, and withdrawing them when they’re worn.

Just as they clutter up tills, the coppers also weigh down security vans and the banking system; they add disproportionately to the burden of every stage of the circulation process. Some of this is naturally offset by the decision taken by many machine vendors, such as Transport for London, to disallow the use of coppers in their machines. But then, what does that tell you about their (lack of) usefulness?

Before the typically British kneejerk rejection of a new idea forms in your mind, think for a moment: what do you actually use coppers for? Whilst plenty of creative answers can be suggested, “buying things” is unlikely to be one of them.

Alex Deane: The offer we should make to UKIP is clear. You endorse our candidates. We'll endorse your agenda.

Follow Alex on Twitter.

We shall soon begin selecting prospective Conservative Party candidates to fight seats at the next General Election. There is much discussion about whether we should seek a pact with UKIP. Here at ConHome, Paul Goodman says no, Andrew Lilico says yes. I agree with Andrew, but as my grounds are different - or different enough - I think it's worth airing here.

It is exceptionally likely that Conservatives with strongly Eurosceptic views will be selected to stand for us in many seats. Those wishing to stand are progressively generally more Eurosceptic (just look at the 2010 intake) and they're certainly, as a general rule, being selected by Eurosceptic Associations.

But given the ongoing rumblings about the settlement of our relationship with the EU, especially after the pledges made before the last election, we can guarantee that each and every candidate - and sitting MP - will be challenged by their local press, by UKIP, and by interested think tanks - are they in favour of a binding in/out referendum or not? If they are, will they campaign for the UK to come out?

Those who are not in favour of such a referendum may struggle to get selected – and if they are selected, they will face UKIP candidates at the polls. In some cases, the votes cast for these UKIP candidates will be the difference between the Conservative candidate winning and losing (making the challengeable but generally reasonable assumption that a large proportion of these votes would otherwise have been cast for us). We saw that at the last election in a clutch of winnable seats and there is no reason to believe that it won’t happen next time – indeed, as I set out below, it’s likely to be worse.

Alex Deane: A vitally important speech by David Davis

By Alex Deane. Follow Alex on Twitter.

For months - since very soon after the formation of the Coalition, in fact - many respected Conservative voices have been saying in private that not enough is being done to cut government spending and encourage growth. Yesterday, that view was given a forceful public voice in a speech by David Davis for the CPS.

Alas online it lacks the compelling slides with which DD accompanied his presentation at the ICAEW conference hall (which, by the way, was packed), but I urge you to read it - for both the intellectual rigour and honesty of its message, and for the remarkably direct soundbites. You may have seen some as I livetweeted it (ahem - @ajcdeane) but just to whet your appetite:

"We are bumping along the bottom. Low productivity, no growth, falling real wages... of course, the Chancellor can quite properly point to reasons beyond his control... but an alibi is not a policy.

It has suited both major parties to exaggerate the ferocity of the cuts.

Small businesses create jobs and wealth. But they are also more fragile... it is not an accident that most insolvencies are precipitated by the Revenue.

Let’s start with the easy part - there must be no new taxes. Yes, I’m talking to you, Mr Clegg.

Whenever you increase a tax rate you can be sure that you will collect less tax than you expect. Why? Because people will do less of the activity that you are taxing.

The carbon price floor will not even bring any environmental benefits. Every tonne of carbon priced out of the UK will be emitted more cheaply elsewhere in the world. Global emissions will not be reduced; just outsourced. This is both environmental madness and economic suicide.

[Having pointed out that government grand infrastructure plans are being announced] In hard times many a government has spent money it does not have on infrastructure projects it does not need. Japan has spent trillions since 1990 on projects... it did not work. [Not in the printed copy in such direct terms, but when speaking DD said this meant we should cancel HS2.]"

Alex Deane: An end to Sunday trading laws, now!

Over the course of the Olympics, trading laws are temporarily liberalised to permit shops to service the demands our capital will see from consumers during the Games.

But the demand for goods and services in evenings and on Sundays isn't restricted to this narrow period during the summer of 2012.

The fact that this period will pass without terrible harm done to our retail sector - indeed, perhaps with some benefit - should be noted, and used as a spur to reconsider our restrictive, antiquated trading laws.

We should retain the "temporary" liberalised laws permanently, for the following reasons:

• Economic growth

UK retail has suffered in recent years from high inflation (which is admittedly improving now) and poor consumer confidence which is not). It's a truism that consumer spending plays a major role in wider economic growth; limiting the opportunities for consumers to spend is counterproductive. The British high street is struggling: attracting consumers back for an additional day of spending would provide much needed support for businesses, both big and small.

• Fairness between retailers

The current rules are unfair. Some retailers can remain open while others are forced to close by a classification system that seems arbitrary, outdated and meaningless to consumers. Both Scotland and the Republic of Ireland impose no restriction on Sunday trading - there's no problem in either jurisdiction, demonstrating the absurdity of arrangements in England and Wales. Furthermore, anecdotal evidence suggests that smaller retailers break the rules with relative impunity, whilst larger outlets – by dint of their higher visibility – are required rigidly to adhere to them.

• Personal choice

The government should not limit the options of how individuals and families spend their Sundays. Proponents of the current law believe that Sunday should remain a day for family and community activity or religious worship; these are perfectly reasonable views for an individual to hold but are personal choices and should not require a limiting of alternative activities through regulation. These choices don’t have to be mutually exclusive; in fact if consumers no longer had to build their weekend schedule around restrictive shopping hours, they would have greater flexibility to engage in a wide range of activities.

Alex Deane: When has a public inquiry been a success?

Meandering, ill-defined judicial inquiries are like buses - you wait ages, and then two come along at once. At least, that will be the case if Ed MIliband has his way on the banking sector.

In my view, this kind of long-grass-punting is A Bad Thing. Politicians like Miliband talk as if judicial inquiries are the "tough option" - but, for politicos at least, they're the softest of options. Easy to call for, hard to resist. But politicians themselves should take responsibility for running inquiries and forming policies - because they are accountable to us at the ballot box, and we can punish them if we think they get it wrong. I think that it's a serious abrogation of their responsibilities when their work is punted to the judiciary.

But even if I'm wrong in principle, when has this worked in practice? Let's look at recent precedents. Anyone want to make the case that Saville or Hutton satisfied (or Leveson will satisfy) the point which concerned the public in the first place? Anyone notice that they were (are) incredibly expensive and took (are taking) forever and a day?

Can you think of one that's worked?

Alex Deane: It's (way past) time to stop giving aid to Argentina

By Alex Deane. Follow Alex on Twitter.

I find Argentina's behaviour towards the Falklands pretty sickening. Despite the consistently expressed and deeply felt wishes of the residents of the islands, the Argentines persist in hostile rhetoric about them and us, advocating boycotts, blocking flights and ships, and asserting completely false claims about ownership which makes a mockery of any genuine understanding of sovereignty and must be disquieting (to say the least) for those who live there.

So I'm proud to support the new campaign from the TaxPayers’ Alliance, launched this morning, calling on the British Government to use its votes at the World Bank to oppose any further loans to Argentina.

One might think that our support for Argentina receiving money is laughable anyway - it is a middle income country (a member of the G20) with no pressing humanitarian need for aid; when they are one of our most belligerent opponents in the international arena, it becomes entirely unjustifiable.

The TPA's research note sets out the situation with admirable clarity, and they have an e-petition which is swiftly garnering signatures. They have also produced a video as part of the campaign - well worth a look.

With the Argentinian government continuing to dispute British sovereignty over the Falklands, and calling for a boycott on British goods, we simply shouldn’t be underwriting any more loans for them.

I've signed the petition - have you?

Alex Deane: Neglecting our friends

For the Jubilee, the flags of all the Commonwealth countries will be flown in Parliament Square. But I have it on good authority that the flags of the British Overseas Territories will not be flown. Not because some fool in our bureaucracy opposed their flying; oh no - someone made the sensible observation that they ought to be flown (which really ought to be automatic, but there we are) and there was agreement with that suggestion. The simple problem, it has emerged, is that the British Government doesn't have them.

That is to say that we don't even have the flags of these places - despite the fact that they are under our jurisdiction and share our Head of State. EU flags? Oh yes - got them aplenty. But places with which we have enduring and important cultural and formal British ties? Not even one each.

A bit shameful, isn't it?

This is now being rectified post-haste, but until it's belatedly fixed, for a sense of how flags should be celebrated and honoured, you can always try this.

Alex Deane: Are you a Londoner? Make sure you vote for Boris – it will be closer than you think

One of the most famous snapshots of President Truman shows him holding a newspaper aloft: the headline is “Dewey Wins”. So certain was the paper that Truman had been beaten that they ran the wrong story when they went to print. I’m sure that all the confidence and certainty of triumph made Dewey and his supporters feel nice at the time, but history is made by actual votes, not headlines or polls, so Truman was President.

That’s worth remembering as London votes today. Opinion polls show a Conservative Mayoralty, but polls are often wrong. So if you think that a Boris win is guaranteed, and that you don’t need to bother voting, you’re wrong. It’s that very feeling that can lead to surprise results. In part because interest in local government per se remains stubbornly minimal, and in part because people erroneously think that they know what will happen, turnout is going to be low – but Ken’s rock solid core vote will definitely come out.

From the client base he built up amongst those who benefited from his largesse with your money, those of his extreme views (remember he welcomed Sinn Fein/IRA to London at the very height of the Troubles) and those who thrive on the culture of jealousy he so assidulously cultivates, there will be votes en masse for Ken that you never quite expected. These people aren’t polled much. They don’t shout the odds or appear on political chat shows. But on the day, the Labour machine drives them (metaphorically and literally) to vote.

Alex Deane: How to mark Commonwealth Day

Today is Commonwealth Day - when we mark the significance of our tremendous family of nations. The Queen has spoken of the importance of Commonwealth citizenship. I have two humble suggestions as to how this might be improved:

• We should have a Commonwealth queue at airports instead of an EU queue. (I declare an interest: this would benefit my wife, who is Australian.)
• Commonwealth countries should allow citizens from other Commonwealth countries to vote in their elections. Some currently do, but not all. (I declare a debt: I stole this idea from Oliver Cooper.)

That's just for starters - you'll have your own ideas, and I'd love to hear them. (Some people will inevitably argue that either or both of the ones I've suggested have complex legal backgrounds: but let's consider the principle before the practical problems.)

In any case, wherever you are, I wish you a very happy Commonwealth Day.

Alex Deane: Our news broadcasters need to think carefully about their purpose

By Alex Deane.

As I type, chunks of central Athens are on fire and thousands of protesters are on the streets, often behaving very violently. I know this, because Twitter tells me so. Both BBC News and Sky News are streaming the arrivals at the BAFTAs.

I don't mean that they just haven't caught up yet: This has been the case for quite some time this evening. And to be clear - I'm not talking about networks with set, pre-recorded schedules - I'm talking about live news channels which are supposedly flexible and nimble, able to bring us the news of the day all-but immediately.

Some would say that this is our modern day "bread and circuses". That may be right: if one thinks about it there's actually something pretty unhealthy about a society in which this happens. But more prosaically, what's the point of our live networks if they don't get this sort of thing right? I accept that I'm generally out of tune with the media (I care about the global economic crisis, politics and world events; I don't care about football, or the BAFTAs - so it would seem that I'm in a distinct minority) - but even so, isn't this sort of serious crisis they're supposed to cover? I mean - if they don't break into their schedules to report on a European capital on fire and facing meltdown... what would it take?

And not to repeat an argument that I've made many times, but it seems to me that our national broadcaster's position is once again the worst in the spectrum when it behaves like this - because producing "excellence" is supposedly its raison d'etre - to use its guaranteed position and lofty, no-need-to-advertise-so-no-need-to-worry-about-ratings status to address those important issues which commercial stations might fail to take on. Instead, yet again, the BBC tonight pursues exactly the same agenda as the commercial outfits, pumping out footage of precisely the same event as everyone else (albeit, on past form, presumably with far more staff), neglecting the most important story of the hour. 

Alex Deane: In praise of the new Trade Union Reform Campaign

An important new arrival in the political sphere: the Trade Union Reform Campaign (TURC) has its launch party tonight in the House of Commons.

As Jesse Norman MP of this parish said in a recent speech, the issue they raise is...

the funding by the taxpayer of public sector employees who in fact work not as nurses, teachers, social workers, local government officers or civil servants but as trade union representatives.

This is no small issue. In 2010-11, trade unions received £113 million from public sector organisations. That's your money, being funnelled to the unions, helping them to lobby government for their ends and to prop up the Labour Party.

Unbelievably, that equals more than half a billion pounds in payments to unions from the public purse over the lifetime of a Parliament.

The work that those people should be doing whilst doing their trade union activities (often full time) then has to be done by someone else.

Alex Deane: Tower Bridge, redux

Last year, in the days of CentreRight, I wrote a piece about plans to sell advertising on Tower Bridge during repair work. I was critical. Not so, many of Con Home's doughty readers. Regulars disagreed with me on several grounds.

• Entirely sensible, said Dominic - it's only for 12 weeks.
• A short one-off, said IRJ Milne.
• I was voicing mindless conservatism, said Greg.
• Hang on, said Jack C, they are covering up that part of bridge with scaffold anyway, I really don't see the problem.

Well, I give you the latest Tower Bridge advertising news: English Heritage "objects strongly" to Olympic sponsor logos which will dangle from the bridge like a peculiarly developed goitre for the period of games we have to endure.

Where and what next..? Some people will have a wholly market-driven outlook on all this (If anything we should be asking the councils to be more adventurous with their plans, said Nonny Mouse last time). And there are some who think the Bridge is ugly and not worthy of heritage status in any case. But for others, who then thought that my "slippery slope" line was alarmist... have you changed your minds, yet?

[That's not just a rhetorical question. There were other commenters last time whose positions were more nuanced: Norm Brainer, for example, held the view that "I don't see a problem if it's not going on the bridge itself but hiding scaffolding and helping to pay for the repairs" - so presumably, he was against me last time, but with me this time.]

Alex Deane: In the Lilico v Dorries debate, an interesting rebuttal comes to mind

It was interesting yesterday to listen to two old friends of mine arguing on the Today Programme. Andrew Lilico, who should be on the Monetary Policy Committee, and Nadine Dorries, who should be in a senior Government position, battled it out over recently mooted plans to shut down social media during civil unrest.

Building on his earlier post on this site, Andrew pointed out that we had vehemently objected when this was done recently by Egypt. Nadine (who has since also posted here about the discussion) sought to distinguish our situation from that precedent, suggesting that it was acceptable for the British government to do it, because it would be for good reasons and by a good government, whilst it was unacceptable for the Egyptian government to do it, because it was for bad reasons, by a bad government.

Given my worldview, you will be unsurprised to learn that I found Andrew more persuasive. Nadine's argument, after all, would ostensibly justify any act by an enlightened government, no matter how coercive - curfews, random stop and search, a compulsory DNA database and so forth (I choose my examples almost at random, but note that each is either mooted by some in the political space or has actually been enacted in recent times). Furthermore, it's circular. This is good, because it's done by a good government for good reasons. It is therefore good. We know that this government is good, because it is good, and therefore this decision is good. As Andrew has pointed out, such assertions can be made with ease by any government, and often are, whatever their actual makeup.

Alex Deane: the non-high speed case for (and against) HS2

I’ve yet to make up my mind on HS2, but it seems to me that whatever one’s view of it, the scheme needs to be discussed on the relevant points, rather than irrelevant ones. I’m afraid to say that I don’t think that’s been happening thus far, and that’s bad for both sides. Here’s my humble attempt to set out what I think are the real issues.

High speed rail should be an ad man’s dream. We love railways in this country. And we always moan about the pace of them. We’ve been left behind by – well, by everybody – in building them, so genuine investment in them should be impressive. But by God, the job’s been botched. Somehow, the champions of HS2 have managed to turn high speed rail into something akin to a curse in middle England. That’s because two bad arguments were used – speed and the environment – rather than two good arguments – capacity and economic growth.

Not speed, but capacity

First, speed: there’s really no need to build a whole new line to help people to get to Birmingham a few minutes more quickly, lovely though that city is. Trains might indeed be capable of getting from A to B a bit more quickly with the new line, but that definitely isn’t the point – the point is capacity. The real supposed benefits are a timetable that is no longer a fantasy but a reality, smaller delays because fast trains aren’t stuck behind slow ones and more train services per se because there’s another line. The West Coast mainline, which (alone) links all of our largest conurbations, is full and apparently demand is set to increase. The new line takes fast trains off that line. The freight and suburban trains that currently use that line will be able to move more freely, and there will be more of them. They will no longer interfere with the passage of fast trains, which is a royal pain for any traveller (as one’s fast train gets stuck behind freight). Fast trains on the new line will not just take pressure off them and provide new capacity – commuters into London currently find that it’s often standing room only on the routes in from Milton Keynes and Northamptonshire. Enhancements to allow more carriages on long distance services or shrinking first class are sticking plasters when surgery’s needed: tinkering with existing infrastructure results in disruption and only buys a little more time before the same mind-numbingly irritating shortcomings of travel in the UK re-emerge. An additional line will provide the space needed on existing lines for extra suburban services before, like on London's wretched and disgusting tube, commuters find that they can’t even get on the train during the morning commute. 

Not the environment, but economic growth

The government has claimed that HS2 is good for the environment. Like most new major infrastructure projects, it ain’t so – or not hugely so, at least. HS2’s champions have absurdly claimed that the line will lead to fewer flights, suggesting that is a reasonable alternative to expansion at Heathrow, which is crackers – people don’t fly to Brum from Heathrow, they fly abroad. The number of flights from the UK won’t go down one bit: everyone saw through this straight away and it’s undermined the case for HS2 from the beginning. Actually, their case is not quite as stupid as that, as the precise claim is that HS2 makes it easier to get to Birmingham Airport from the south, but that’s still pretty stupid, because nobody will do that.