Sajid Javid MP: Britain must maintain an independent, submarine-based nuclear weapons system

Sajid Javid is the Conservative MP for Bromsgrove and was previously a senior Managing Director with Deutsche Bank.

Despite the commitment in the Coalition Agreement to replace our ageing Trident weapons system, the Deputy Prime Minister’s recent comments on the “huge, huge” sums involved have reopened the debate on whether Britain needs an independent nuclear deterrent.

Azeem Ibrahim wrote this piece on ConHome a fortnight ago on the financial implications of replacing Trident.  But let us be in no doubt.  Whatever the final cost of renewal, Britain must maintain an independent, submarine-based nuclear weapons system.

Whilst we are not the power we once were, we still have a strong voice on the world stage by virtue of our economic might, our strong relations with other major countries (most notably the US) and because we have the bomb.

When the UN Security Council was established in 1946 only the US possessed the bomb, but it is no coincidence that the five permanent members are now all nuclear powers.  Trident is what separates us – and the same goes for France – from the second rank of European powers.  Abandoning our nuclear deterrent would jeopardise our seat at the Security Council and the veto power that accompanies it.  Whatever else we may think of the UN (and I believe that there is a lot wrong with it), the veto is a tangible strength and one coveted by many nations.  In this way, reducing our hard power capability also diminishes our soft power influence.

Sajid Javid MP: How to rebuild the British economy

Sajid Javid is the Conservative MP for Bromsgrove and was previously a senior Managing Director with Deutsche Bank.  In this Platform, he builds on his Maiden Speech of last week, and argues that the global economic outlook puts even more pressure on us to start cutting public spending immediately.

Not only have we inherited an utter economic mess from Labour but the global economic outlook is about to complicate matters further.

Let’s remind ourselves of the domestic disaster that we have been left to clean up.   At 12 per cent of GDP, Labour passed us the largest deficit in Europe.  During their 13 years in office, Labour took our visible national debt from £351 billion to £894 billion, an increase of 155 per cent.

Labour also mastered the dark art of off-balance sheet borrowing, in much the same way as RBS, Citibank and Enron did.  For instance, our PFI liabilities are estimated to be at least £150 billion and our public sector pension liabilities an eye watering £2,000 billion.  Combine these with the visible debt and, at £3,044 billion, you have one of the most indebted nations on Earth.  That amounts to over £49,000 per head.

We have no choice but to make big cuts in public borrowing and public spending.  If we don’t, we will no longer be able to sell enough government bonds to fund the deficit, leading to an economic crisis of catastrophic proportions.  It’s that simple.  We can’t even plan to reduce the debt – we can, at best, only add to it less fast.

Sajid Javid: Capitalism is essential for our prosperity and liberty

Sajid Javid is a businessman and private investor.  He was previously a senior Managing Director at Deutsche Bank AG. In this Platform he argues that the current wave of state intervention must not be permanent, and that Anglo-Saxon capitalism is essential for our prosperity and liberty.

Every Christmas I attend a reunion of old school friends from Bristol.  The talk often turns to politics, as my friends know my interests all too well.  This year, after a bout of banker bashing, one friend stated: “capitalism is dead!”.  Admittedly, by this time my friends had consumed a few drinks, but it still startled me to see others nodding their heads.

Upon reflection, who can blame them?  It’s what they see.  We have nationalised much of our banking industry. Government spending has rocketed.  Taxes are up.  Regulation is back.  Class war is encouraged. 

Capitalism is in a good deal of trouble.  State intervention, control and ownership  - in the UK and beyond - is back in fashion.  But over the past 150 years, capitalism has more than proved its worth.  The parts of the world where it has been let loose have flourished; the parts where it has been held back have languished.

The importance of capitalism is not just driven by economics.  A critical reason why capitalism has been such a success is that its sits well with human nature – our desire for liberty and prosperity.  Communism eventually collapsed because it relied on a total restriction of individual freedom to survive.  It murdered millions just to avoid criticism.

As long as people want to improve their living conditions, earn more than their parents did, own their own home and car, go on holiday, travel the world and buy cool, but perhaps even useless, things, they will need a mechanism that allocates scarce resources far more efficiently than a repressive state.  Capitalism is not perfect, but if you want prosperity and genuine freedom, it is essential.

Sajid Javid is a businessman and private investor.  He was previously a senior Managing Director at Deutsche Bank AG. In this Platform he argues that the current wave of state intervention must not be permanent, and that Anglo-Saxon capitalism is essential for our prosperity and liberty.

Every Christmas I attend a reunion of old school friends from Bristol.  The talk often turns to politics, as my friends know my interests all too well.  This year, after a bout of banker bashing, one friend stated: “capitalism is dead!”.  Admittedly, by this time my friends had consumed a few drinks, but it still startled me to see others nodding their heads.

Upon reflection, who can blame them?  It’s what they see.  We have nationalised much of our banking industry. Government spending has rocketed.  Taxes are up.  Regulation is back.  Class war is encouraged. 

Capitalism is in a good deal of trouble.  State intervention, control and ownership  - in the UK and beyond - is back in fashion.  But over the past 150 years, capitalism has more than proved its worth.  The parts of the world where it has been let loose have flourished; the parts where it has been held back have languished.

The importance of capitalism is not just driven by economics.  A critical reason why capitalism has been such a success is that its sits well with human nature – our desire for liberty and prosperity.  Communism eventually collapsed because it relied on a total restriction of individual freedom to survive.  It murdered millions just to avoid criticism.

As long as people want to improve their living conditions, earn more than their parents did, own their own home and car, go on holiday, travel the world and buy cool, but perhaps even useless, things, they will need a mechanism that allocates scarce resources far more efficiently than a repressive state.  Capitalism is not perfect, but if you want prosperity and genuine freedom, it is essential.

Sajid Javid: Foreign aid encourages corruption, conflict and dependency

Sajid Javid is a businessman and private investor.  He was previously a senior Managing Director at Deutsche Bank AG.  In this Platform he argues that traditional foreign aid policies have kept Africans in poverty and that we need a radical new approach.

As a financier with experience of working with developing countries, I was once asked to help restructure a defaulted £200 million loan that a consortium of banks had made to an African government.  I started by following the money trail.  It turned out that over £145 million had ended up in the pockets of government ministers and bureaucrats.

Giving aid to Africa remains one of the biggest ideas of our time.  Governments are judged by it, and that’s one reason why the Conservatives have rightly given international development such a high priority.  It’s not only morally right to help the poorest in the world, but it’s practical politics too.  The more Africa develops economically, the fewer conflicts we will get drawn into and the less illegal immigration we’ll see.

We need to look carefully into what form our help takes.  Evidence overwhelmingly suggests that government-to-government aid to Africa has made the poor poorer, and growth slower.  It has fattened the already bulging offshore bank accounts of Africa’s ruling elite, and made the majority of Africans dependent of Western handouts – unable to work hard and earn a decent living.

Over the last 40 years, at least £450 billion of development-related aid has been transferred to Africa from rich countries.  Yet real per capita income today is lower than it was in 1970.  Over two-thirds of the continent’s population lives on less than a pound a day.

Foreign aid encourages corruption

Rampant corruption in Africa is well known – far too many people go into politics only to get rich.  Despite this, much of the roughly £30 billion of international assistance that will go from the developed world to Africa each year will go as direct government to government aid – including most of the cash coming from the UK.  The economist Peter Bauer put it well half-a-century ago, foreign aid is a way of “taxing the poor in rich countries and passing it to the rich people in poor countries.”

Sajid Javid: The news from Dubai is a big blow to the UK banking sector

Sajid is a businessman and private investor.  He was previously a senior Managing Director at Deutsche Bank AG.  In this Platform he argues that current financial crisis in Dubai will hit UK banks hard and makes the need for action to resolve our banking problems even more urgent.

If you needed any evidence of the fragility of the global economy then consider the announcement 48 hours ago by Dubai World that it will be unable to repay its debts.  Although not technically a default (yet) by the government of Dubai itself, for all intents and purposes that’s exactly what it is.  Dubai – a city-state that modelled itself as the new Singapore or Hong Kong – turns out to be Argentina.

On the back of this news, global stock markets had their worst day in 8 months.  The cost of buying insurance on sun-drenched Dubai’s bonds hit Icelandic levels this morning.

The UK economy needed this news like a hole in the head.  UK banks, led by RBS and HSBC, have the largest exposures to Dubai of any other major banks in the world.  The exact exposures are not yet clear, but don’t be surprised to learn that a significant portion of the losses from this $60 billion default will rest on UK shoulders.

Sajid Javid: We must slash corporate tax rates and burn regulations to improve conditions for small and medium sized businesses

Sajid Javid is a private investor in small businesses.  He was previously a senior Managing Director with Deutsche Bank in London, specialising in developing countries.

Until Lord Mandelson announced this week that the Government is delaying implementation of the EU temporary workers' directive, my business was planning to virtually stop hiring temps.  Going ahead with this bad European legislation would have led to higher unemployment and additional costs for British business of £3.5 billion per year.

This brings me to my point.  If we are to get out of this economic mess, we are going to have to radically improve the conditions for small and medium sized businesses - the major drivers of economic growth, product innovation and, most importantly, job creation.

Many of the sources of the much talked about economic recovery are temporary and precarious.  The rebuilding of inventories will not boost firms' output for long.  Spending is being driven by government largesse, not confidence.  Massive fiscal and monetary stimulus is providing a short term boost, but the underlying problems remain.

George Osborne was right last week to spell out so clearly that we will only begin to mend our broken economy by making a significant dent in government spending.  This will restore our financial credibility on the world markets and prevent interest rates from sharply rising.  But low interest rates alone are not going to get us out of this mess.

Sajid Javid: Parental involvement and encouragement is the key to social mobility

Sajid Javid is a private investor in small businesses.  He was previously a senior Managing Director with Deutsche Bank in London, specialising in developing countries. He lives in London with his wife, Laura, and four young children.  In this Platform argues that parental involvement is the key to social mobility.

After being part of a government that has so demonstrably failed to improve social mobility, at least in his report released last week Alan Milburn tried to set out some fresh thinking.

It made me recall a recent visit I had to the street in Rochdale where I was born.  It was a bittersweet experience.  Sweet because childhood memories returned.  Bitter because I also remembered how, as a family, we had to work hard to make ends meet.  As I noticed some children kicking around a football on the street, I couldn't help thinking how different life is for my children.

My father was a bus driver.  My childrens' is a City financier and businessman.  My mother, who was unable to go to school, was a seamstress.  My childrens' is a graduate and former accountant that could afford the luxury of becoming a full-time mother.  I was brought up in some of the most deprived working class neighbourhoods in England.  They were born in Chelsea and live in leafy, middle class Fulham.

But, sadly, it seems such social journeys are not becoming any easier.

Sajid Javid: The deep truth beneath Labour's green shoots

Sajid Javid is a private investor in small businesses.  He was previously a senior Managing Director with Deutsche Bank in London, specialising in developing countries.  He lives in London with his wife, Laura, and four young children.  In this Platform argues that Labour is deliberately overplaying the evidence of economic recovery and, as a result, failing to take the action that we so dearly need.

Watch out! The green shoots of recovery...here they come.  Flash Gordon has saved the day again.  Ministers are falling over themselves to tell us that the worst of the recession is behind us, and that we have begun to ride the positive gradient of a classic "V" shaped recession. They point to last month's National Institute of Economic and Social Research (NIESR) report which said that the recession hit its trough in March; the purchasing managers' index (PMI) for the services sector, which rose from 48.7 to 51.7 (above the critical 50 level that marks the divide between expansion and contraction - the first time since March 2008); and the recent Halifax survey that says that average house prices bounced back 2.6% in May.  Most of all, minsters say we shouldn't just take their word for it, just look at the financial markets' own judgement: the UK stock market has just had an outstanding quarter.

Clearly, any signs of recovery are to be welcomed.  However, with good reason, many economic commentators remain sceptical of all this evidence.  There are some serious issues and uncertainties out there that remain unaddressed, and could so easily throw any potential recovery off track.  Instead of a classic "V" shaped recession, as Labour would dearly like us to believe this is, we could in fact head into "W" or even "L" shaped territory.

My fear is, since this Government has so clearly set out to win the next election through whatever lies it chooses, it will spin these "green shoots" as a full blown recovery and ignore the serious economic issues we still face.  Last week's shocking announcement that there will be no Comprehensive Spending Review is testament to that.  There will, sadly, be more dishonesty and and colossal irresponsibility to come from Labour, meaning eventual recovery will take far longer.

There are at least four key reasons to remain concerned.

Sajid Javid: Britain has a democratic deficit as big as its budget deficit

Sajid Javid, currently based in Singapore with his wife Laura and four young children, has been a Conservative Party activist for many years and joined the Candidates List this month.  He will be returning home to England next month.  He is a Managing Director with a large European bank, specializing in emerging markets.  In this Platform he urges more powers for backbench MPs, a reclaiming of powers from the EU and a decentralisation of power to local councils and voters. 

Last week, a Commons Select Committee published its long awaited report on a profession that it believes helped cause the current crisis.  MPs found that the profession's remuneration culture was “fundamentally flawed”.  They called for greater transparency and a new code of ethics, and also noted that the followers of this profession displayed a “degree of self-pity, portraying themselves as the unlucky victims of external circumstances”.  As you may have guessed, the MPs on the Treasury Select Committee were referring to bankers and the financial crisis but equally, as we now so plainly see, they could have been talking about their own profession and the political crisis. 

At this point I should declare that I am currently a banker but hoping one day, believe it or not, to join the profession of the members of the Select Committee.  Prior to Expenses-gate, when asked why I wanted to join the political class, I would joke that I wanted to join a profession that had a better image.  Clearly, the events of the last two weeks have decapitated that line.

But the connections between the crisis in finance and the crisis in politics are very real and of grave concern.  Dealing with the financial crisis successfully requires the public to trust the politicians that need to make brave decisions, and accept that they are acting responsibly and willing to be held to account.  It also requires the public, many of whom are facing redundancies, negative equity and economic hardship, to understand why they may have to temporarily pay higher taxes and why certain public services need to be cut.  In his thoughtful speech in Cheltenham last month David Cameron talked of the “Age of Austerity” and of the sweeping changes that we will need to combat the financial crisis:

“I’m talking about a whole new, never-been-done-before approach to the way this country is run….The age of austerity demands responsible politics, [because] over the next few years we will have to take some incredibly tough decisions on taxation, spending and borrowing – things that really effect people’s lives.  Getting through those difficult decisions will mean sticking together as a country – government and people.  That relationship, just as any other, is strengthened by honesty; undermined by dishonesty.”

This is absolutely right and increasingly more relevant.  But if the public continues to hold the political class in utter contempt, why on earth would we expect them to “stick together” with the government?  If politicians can’t show any responsibility and accountability with respect to their own actions, why should they expect the public to?  Many feel that there seems to be one law for the governing class and another for the rest us.  Most people are financially honest, and would not dream of fiddling their expenses or keeping their income from the taxman.  They rightly expect just as much from those that seek to govern them. 

Sajid Javid: Building a bold human rights policy

Sajid lives in London with his wife Laura and their three young children.  He graduated in Economics & Politics from Exeter University in 1991.  He is a Managing Director of a major international bank, specialising in emerging markets.

The Conservative Party must be "...pro-active in supporting democracy and those who bravely champion freedom in their own countries. It must put economic and political pressure on brutal regimes, and it must seek to hold them to account." - William Hague, address to the CPHRC, April 2006

In the 1980's the Conservative government delivered a much needed bold economic policy. In the 21C it is only too right that Shadow Foreign Secretary William Hague has pledged to put human rights at the heart of Conservative foreign policy by establishing the Conservative Party Human Rights Commission (CPHRC), of which I am proud to be part of.

Whilst any nation's foreign policy should in the first instance serve its national interest, the CPHRC helps in making human rights a priority in our foreign policy by highlighting human rights concerns worldwide. Given the number of brutal regimes that still exist around the world, compassionate government is required abroad not just at home.

World events in recent years have shown only too well that British foreign policy should promote freedom, the rule of law and the dignity of the person even if that means having to forgo short term gains. We have to speak out boldly even if that means temporarily straining our relationships with friends. Hague was right to recently advise our US friends that detention without trial at Guantanamo Bay is plain wrong.