ConservativeHome's ToryDiary

YouGov: Tory lead at 4% before dust settles on PBR

More in The Telegraph.

The poll was conducted yesterday evening and today; largely BEFORE the negative press coverage had an opportunity to impact and the leaked reports of a VAT increase to 18.5%.

Safe

After yesterday's "outstanding" Commons performance, a PoliticsHome survey of Westminster insiders finds that George Osborne is seen as safe as Shadow Chancellor.  46% of the panel of journalists, parliamentarians and thought leaders answered "yes" to the following question: After several weeks of criticism has George Osborne's response to the PBR now secured his position as shadow chancellor? 38% said he was safe anyway.  15% answered no.

But George Osborne's renewed strength isn't just because of his barnstorming performance.  The tide started turning in his favour last week.  Some of his positions, for example, on matching Labour's spending plans were indefensible and there have been rushed-out announcements that have struggled to withstand scrutiny; eg the recruitment subsidy but he made the right judgment call on the big strategic issue of borrowing.  He recognised that debt was the big issue and focused on it relentlessly. It will be interesting to see if Mr O bounces back in the next survey of grassroots Tories.

The end of Brown's "strategic relationship" with the Daily Mail

The Press Gazette notes an interesting confession by the Daily Mail's Political Editor Benedict Brogan. Ben, speaking in a personal capacity, comes close to saying that his newspaper has been played by Gordon Brown:

"Brogan said that although Tony Blair was seen by many as "the master of spin", he believed the Gordon Brown spin machine was "even more formidable than the one attributed to Blair". "When the time comes to write a record of Gordon Brown's time as chancellor, I think the record will show that Gordon Brown was phenomenally good at building strategic alliances with certain newspapers, mine included, and certain journalists and using that to his advantage," he said."

From the look of today's Mail front page, the "strategic relationship" is over.  The juxtaposition of a grinning Brown with the £1TRILLION debt figure is particularly strong.

National debt counter launched on conservatives.com

Click here to get depressed.

One way or another Labour calculates that it will profit from yesterday's gamble

Yesterday Brown gambled and he thinks he can 'win' either way.  If the gamble sparks a recovery in his poll rating he will be happy but if it doesn't it won't be Labour that has to pick up the bills.  An incoming Conservative government will inherit a public finances nightmare.  Winning the next General Election will be the beginning of some very tough years.  It's been variously called a bombshell budget, a boomerang budget and a kamikaze budget.  I'll just call it cynical.  Deeply, deeply cynical.

Tim Montgomerie

After the PBR: Conservative Future hits the streets

After George Osborne's outstanding attack on Alistair Darling's Pre-Budget Report this afternoon, it was time to get the party's message out to the wider public.

And playing a key role in doing this this evening were legions of tax bombshell T-shirt-wearing Conservative Future members, who handed out tens of thousands of leaflets between them at railway stations up and down the country.

Most of the big London termini were covered, as were Leeds, Bristol, Manchester, Newcastle, Birmingham and Liverpool. I hear these hit squads - and the literature - have been extremely well received and that the party will be repeating the exercise at various points in the future.

Jonathan Isaby

8.30am, Tuesday: Two more photographs

Reaction from the blogosphere to the PBR and George Osborne's response

Here is a round-up of some of the reaction from bloggers to this afternoon's Pre-Budget Report and the response given by George Osborne, which we have already hailed as oustanding.

Iain Dale says that this is the day that Labour "blew it big time" and describes George Osborne's performance as "really strong". He also quotes a non-Conservatve MP as having told him: "This wasn't George Osborne. It was Ozzy Osborne - drawing blood!"

Janet Daley at the Telegraph says the PBR was "more of a take-away than a give-away Budget", given that the tax increases outweighed the fiscal stimulus. She says that in his response, George Osborne "did very well". 

Her colleague, Iain Martin, is a very angry man, describing the scale of the Government's mismanagement of the economy as "breathtaking" and "a gross moral failure by this government". In a later post, Iain heaps praise on George Osborne, whom only a couple of weeks ago he was asking to be moved from the shadow chancellorship. He describes Osborne's performance as "absolutely blistering and his best Commons performance to date", concluding that "it was seriously impressive and strengthens his position enormously."

The observations of Alex Singleton, meanwhile, concentrate on George Osborne. Saying that he came across as "a powerful and effective shadow chancellor", he concludes that "his performance will have done much to restore faith in his position".

Matthew Elliott of the TaxPayers’ Alliance, welcomed the immediate VAT cut, but said the prospect of large tax rises in the future was "very worrying". He called for "permanently low taxes, not a crippling debt mountain and higher tax to come. It is unfair that the Chancellor is not going to make the public sector share any of the pain of the recession. If the Government cut out wasteful and unnecessary public spending, we could have larger tax cuts, less borrowing and a faster recovery.”

Harwich MP Douglas Carswell blogged live from the Commons, expressing exasperation at the Speaker for not taking Labour MPs to task for heckling George Osborne, whilst he did admonish a number of Tory MPs.

The Burning Our Money blog describes Alistair Darling's expectation of a mild rececssion as "pie in the sky" and concludes that it is a "a bad news budget that's actually even worse than it looks".

Peter Hoskin at Coffee House wonders whether Alistair Darling's gamble will pay off. Pointing out that "the Treasury's tax receipt and net borrowing figures always tend to be optimisitic", he wonders whether this time they're even more optimistic than usual.

Menawhile, his colleague, James Forsyth, writes a post with the alliterative headline, "Labour fails to get bang for its borrowed buck". He predicts that Darling has potentially set himself up for a fall by predicting growth in Q3 next year and also describes George Osborne's performance as "his strongest ever Commons performance", adding: "Today was the day that Osborne proved that he is up to the task of being Shadow Chancellor at a time when the economic question is once more dominating politics".

And Fraser Nelson's reading of the figures is that the debt bombshell "is not due to explode until 2015/16", concluding that "this is not just an ecnomic failure, but a moral one".

In a post entitled "Osborne Wows", Guido writes that his co-conspirators were hugely impressed with Osborne's performance. He also cites Tom Clougherty of the Adam Smith Instititue as describing the shadow chancellor's performance as "the speech of his life".

Outstanding performance by George Osborne

Highlights are pasted below but George Osborne's response to the boomerang budget was outstanding.  He showed genuine anger at the failure of Brown to prepare us for these difficult times.  He highlighted three key weaknesses in Labour's record:

A MASSIVE INCREASE IN THE PUBLIC DEBT.

THE FACT THAT BRITAIN IS FACING THE MOST SEVERE RECESSION OF ALL DEVELOPED NATIONS.

TODAY'S TEMPORARY TAX CUTS WILL BE FOLLOWED BY LARGER TAX RISES WITHIN A YEAR OR TWO.

Congratulations George.  Now we want you to bring forward Tory announcements on waste-funded tax reliefs - the proceeds of which can be shared with tighter control of borrowing.  But that's for another day.

George Osborne's PBR response

Visibly angry George Osborne gets up. Highlights follow, not verbatim.

The Prime Minister's claim to have abolished boom and bust is shown to be rubbish. A national debt built up over decades has been doubled in five years.

All Labour Chancellors run out of money. All Labour governments bring the country to the edge of bankruptcy. Prudence is dead. Labour has done it again.

Tax giveaways for Christmas. Tax rises for life.

Like the gambler who can't give up he thinks he can borrow himself out of trouble.

It's total nonsense to blame America for the biggest housing boom in the world or the largest budget deficit in the developed world?

Brown never prepared Britain for the bust.

Britain's recession will be worse than almost any other developed country in the world. Brown built growth on debt, a housing boom and bigger government. He did not fix the roof when the sun was shining.

Borrowing money to finance lower prices when prices are already falling doesn't make sense.

Higher taxes on high earners only fills 5% of the Chancellor's black hole. It distracts from the big tax rises that are coming for middle earners. The rise in National Insurance is not so much a bombshell but a precision-guided missile aimed at the middle classes and the recovery.

You cannot spend your way out of recession.  Japan could not.  Britain cannot.

The responsible course would have been to control borrowing and to get credit moving for the real economy.

This is the worst public policy failure for a generation.  The national debt doubled.  The recession in Britain set to be the worst in the developed world.  Large permanent tax rises set to follow temporary tax cuts announced today.  Only the Conservatives will restore fiscal sanity to Britain.

ENDS.

Live blog of the Pre Budget Report

Click here for the live blog of George Osborne's repsonse!

4.24pm Alistair Darling sits down.

4.23pm Increases in child benefit will be brought forward to January, and at the same time pensioners will get a one off bonus of £60.

4.22pm Pension credit to increase next year. State pensions will increases with the highest rates of inflation this year.

4.20pm People saving through the "Savings Gateway" will get additional contributions from the Government.

4.19pm The expansion in vehicle excise duty bands will be introduced but they will be phased in and at a slower rate.

4.15pm £775 billion to be spent on new social homes.

4.13pm New lending panel to monitor loans to businesses and individuals; more government funding for free debt advice announced.

4.06pm It's still important to protect the environment, he says, before announcing a reform to the air pasenger duty, which will vary depending in the length of the flight.

4.04pm Deferral of the increase in small business rate of corporation tax.

4.03pm £1 billion of credit to be offered to small businesses under a temporary small business finance scheme.

4.02pm HMRC will allow firms to spread their tax payments over a schedule they can afford.

4.00pm Spending will only rise by 1.2% in real terms after 2011. It had been 2.1%.

3.59pm Tory deputy chief whip Andrew Robathan told off by the Speaker for heckling.

3.59pm Duties on tobacco, alcohol and fuel to be raised in order to offset the cut in VAT.

3.58pm Confirmation of new 45% income tax rate from April 2011 for those earning £150,000 and over.

3.57pm From April 2011 there will be a 0.5% rise in all rates if NI contributions.

3.56pm The £120 increase in the personal income tax allowance will be permanent, and increased to £145 from next April.

3.54pm Confirmation of VAT being cut from 17.5% to 15% until the end of next year, coming into effect on December 1st. He asks for retailersvto pass it on as soon as they can.

3.53pm £3 billion of capital spending brought forward to next year.

3.51pm Announces an additional £5billion in efficiency savings.

3.50pm "Allowing borrowing to rise is the right choice for the country," he says.

3.46pm The fiscal rules will be temporarily suspended.

3.45pm There will be "significantly" lower tax revenues in the short to medium term.

3.43pm He says there will be a £20 billion fiscal stimulus between now and April 2010.

3.41pm Output will continue to fall for the next two quarters and will then recover, he claims, with inflation falling to 0.5% by the end of next year.

3.38pm Darling announces a review of arrangements in Crown dependencies and of international compensation arrangements on the wake of the collapse of the Icelandic banks. 

3.37pm Tory MP Michael Fabricant told off by the Speaker for too much heckling.

3.36pm Again, not sign of accepting blame for the problems as he says the roots of today's problems are failings in the global banking system.

3.34pm He lays the blame for the beginnings of the current crisis on the US sub-prime market.

3.30pm Alistair Darling gets to his feet to deliver the Pre-Budget Report. He begins by talking of economic difficulties "not seen for generations".

David Cameron's speech to the CBI

David Cameron has set out the Conservative approach to dealing with the recession in a speech to this morning's CBI conference.

He was especially forthright in laying the blame with the Government for the fact that Britain is facing a deeper and longer downturn than any other industrialised nation.

"To argue – as some do – that this all comes from America is nonsense. Britain enters this recession with the largest budget deficit in the developed world. This is not America’s fault – it’s because no money was ever put aside for a rainy day. Britain enters the downturn with the highest level of personal debt in the world. This is not America’s fault – it’s because the Bank of England had its historic ability to call time on the levels of debt in the economy removed. And Britain enters the downturn with one of the most unbalanced economies in the world, far too dependent on housing, now in decline, finance, now in crisis, and government spending, now at its limit. That’s not America’s fault - it is the consequence of domestic policy failures."

He described his top priority now as "monetary activism":

“What does monetary activism really mean? First it means lower interest rates. This week the Bank of England themselves said that they had considered cutting interest rates by more but – in anticipation of a fiscal stimulus in the Pre Budget Report – had decided not to. We have consistently argued that government must not do anything to make further interest rate cuts less likely.

“But simply cutting interest rates and appealing to banks to pass on the cuts is not enough... So as well as lowering interest rates, monetary action must mean radical new measures to actually get credit flowing through to businesses, measures that recognise how existing banks are still suffering from the trauma of toxic assets and massive over lending, like a new institution to issue government guarantees for new lending, with a fee to cover the risk to taxpayers. The banks would still make the loans and still carry some of the risk, but a government guarantee would allow the banks to expand their lending.

The politics of envy is back

The Labour Left has a lot to enjoy at the moment.  All the talk - across the globe - is of more regulation and state control.  But nothing will give them more pleasure than the return of higher taxation on the wealthiest Britons.

It was one one of the few real accomplishments of New Labour that they appeared to understand that heavy taxation of the wealth was counterproductive, leading to a brain drain of talent and a killing of incentives.  That belief died today.  Old Labour is back and with it an attempt to reignite the politics of envy.  Paul Goodman MP recently reminded us where envy takes us: "In the medium to long term, envy means lower profits, less wealth, fewer jobs, less money for public services."

A higher tax on the wealth isn't going to raise much extra revenue.  That's not its point.  It's all about political positioning: cuddling up to the LibDems in the hope of a future coalition deal and of wrongfooting the Conservatives. It's also dishonest; Brown and Darling are hoping that voters will believe that only the rich will be hit by today's boomerang budget, when in reality we'll all be hurt by Labour's tax bombshell. Tick, tock, tick tock.

Britain doesn't need more tax; it needs a leaner, reformed public sector.  In a superb piece on today's Platform, Susie Squire discusses The TaxPayers' Alliance's latest Public Sector Rich List. She shows how the rich are getting richer in the public sector and she notes a complete breakdown in the relationship between reward and performance. Read her piece here.

Tim Montgomerie

Is Boris too much of a maverick?

When London voted for Boris Johnson as mayor six months ago, it knew it was voting for figure who had a reputation for being a maverick.

Indeed, part of his appeal arguably was that he was someone who would not slavishly follow the party line, but rather speak his mind and not be afraid to cause the occasional headache for David Cameron and strategists at party HQ.

There are a couple of examples from the last fortnight of him doing just that: first, his continued support for a new airport in the Thames Estuary, and just last Friday, his announcement of a GLA inquiry into the benefits of an amnesty for illegal immigrants.

Part of his job as mayor is to act as a figurehead for the capital and to take a lead on a wide variety of issues - and Boris is clearly determined to do this, even in areas over which he has no direct jurisdiction.

But how far should he go? Is there a danger of him becoming too much of a maverick?

Jonathan Isaby

Give us your questions for Eric Pickles

Eric Pickles, the shadow secretary of state or communities and local government, has agreed to answer questions from ConservativeHome readers. Leave your questions below, we'll put a broad selection of them to Eric and then publish his reponses.

The comments thread is now closed and we'll publish Eric's responses very soon.

Labour to raise top rate of income tax to 45%

That's what the BBC is reporting.  The higher income tax rate won't, however, apply until after the next election and only for those earning £150,000 or more.

Keeping income tax rates down was one of the landmark pledges associated with New Labour. That pledge is about to be buried.

Labour plan to use the higher rate to taunt the Tories.  If the Conservatives oppose the higher band they'll be painted as 'friends of the rich'.

David Cameron: The only certainty about a VAT cut is that it'll add £12bn to the national debt

Key messages from David Cameron's interview on Andrew Marr's Sunday morning programme (not verbatim):

It is not true that the Conservatives are inactive in the face of recession: We are proposing a two year freeze in council tax, a VAT holiday for all small businesses, a 1% NI cut for very small businesses and a £2.6bn aggressive incentive to encourage businesses to recruit the unemployed.

Government borrowing is massive: People will be shocked when they see that borrowing is going to be £80bn to £100bn.  Labour's borrowing bombshell will become a tax bombshell.

Brown's stimulus may not work: As the Chairman of the European Central Bank warned, the stimulus may not work at all if people know that tax rises are going to quickly follow temporary tax cuts.

Labour's likely VAT cut: The Conservative Party will make a decision on how to respond when we've seen the detail of what the Government proposes but the only uncertainty about a VAT cut is that we'll add £12bn to the national debt.

The Tories are telling the truth: Unlike Labour there's no blather. We are telling the British people the truth and you can't borrow yourself out of a borrowing crisis. We are telling the people the truth that we can't carry on with Labour's spending plans.

This is a monetary crisis needing a monetary response: Interest rates need to be cut further and government action on fiscal policy must not endanger the Bank of England's freedom to reduce those rates.

Bank lending to business: It's no good shouting at the banks. There's a complacency from Peter Mandelson and the Government on this issue.  The Conservatives are open to offering insurance for new loans from banks to businesses.

George Osborne is a very good Shadow Chancellor: And he'll make a very good Chancellor.  I meet a wide range of people.  I've met all former Tory Chancellors.  They all tell me the same thing; that Britain is over-borrowed.

At the end of the programme David Cameron joined Peter Mandelson on the sofa and offered to put Eric Pickles on Strictly Come Dancing if the Prime Minister allows Lord Mandelson to appear.

'However Gordon wraps it up, it's still a tax bombshell'

The image above appears in a number of newspapers, including the Mail on Sunday.  According to the Independent on Sunday, "vans showing the "tax bombshell" poster will drive around busy shopping areas in central London."  It continues:

"200,000 leaflets warning that government borrowing will soar to £100bn by 2010 will be handed out at commuter stations and target constituencies."

George Osborne commented: "He is taking the British people for fools if he thinks they can't spot the difference between a tax cut and a tax con."

Meanwhile the Labour Party has launched its own campaign.

It attempts to portray David Cameron as an economically illiterate schoolboy.  Click here.

1pm: Nineteen second animated version of the Tory campaign.

ICM: Tories 11% ahead

An ICM poll for The Sunday Mirror has the Conservatives on 42% (-1%), Labour 31% (+1%), LibDems 19% (+1).  Changes compared with 8th November.

Graphic after X factor.

9.15pm:

Fasten your seat belts (II)

'What's the mood of Conservative MPs?' I asked a frontbencher last week. 'Is it still tracking the opinion polls?' 'Oh no,' he replied quickly, 'It's worst than that. It's not all opinion polls; just the very latest one.'

I hope I'm wrong but it's perfectly possible that there'll be an opinion poll this time next week which will show the Labour Party narrowly ahead.  Labour are pursuing two main themes at the moment (I paraphrase):

1. We'll do whatever it takes to mitigate the downturn (unlike the Tories); and
2. We'll force the horrible banks to lend to the real economy.

CCHQ are hitting back in the next 24 hours with the launch of an advertising campaign.  It will be posted on conservatives.com early tomorrow morning.  But we should be prepared for some bumpy times so - like last year - I'm inviting you to fasten your seat belts and while the polls fluctuate remember ten reasons why the next election is still likely to produce a Conservative victory...

Andrew Lilico and Warwick Lightfoot both back a fiscal stimulus today but the message of Matthew Parris, writing in The Times, is that the stimulus may not work and that prospect should probably be Gordon Brown's number one worry:

"If summer comes and still the recession bites, Mr Brown's sorcerer's reputation may dim. With the stimulus spent and still not stimulating; the seed corn eaten, not sprouting; the grind of the pistons as the engine refuses to spark, a Prime Minister hunched over the ignition, still bragging that he knows how to start this thing, could annoy mightily."

Tim Montgomerie

Ken Clarke reiterates his desire to remain on the backbenches

Former Chancellor Ken Clarke has given an interview to tomorrow's Times (Saturday) rich in quotes in which he reiterates his support for George Osborne and states again that he does not want a frontbench job.

Here are some of the highlights of what he has to say.

On George Osborne:

“The attacks on George are foolish and I don't agree with them. I think he is very good. It would be bizarre for David to move George. Politically it would look weak. People keep using me as a stick to beat George with. I'm not particularly flattered. I've realised it's just Bash George fortnight.”

On Osborne's warning of a run on the pound:

“I was amazed anybody bought the idea, being spun by Gordon's people, that there was some convention that you don't talk about the pound - that's daft. I remember Harold Wilson used to get frightfully upset about people selling sterling short but that didn't stop people talking about the pound because the pound was weak.”

On the leadership's resistance to promising tax cuts:

“David and George have made us look like a potentially governing party again but the message has not quite spread to some of my colleagues. These are the people who think you've got to promise tax cuts to win any election. We've fought elections on tax cuts when you can't afford them and usually we've lost - we did actually win one in 1992, which was a considerable embarrassment to me when I was Chancellor because there wasn't the slightest chance of any tax cuts.”

On refusing to serve on the Opposition frontbench:

“Dave asked me to be Leader of the House when he took over and I said no. I prefer to be a backbencher. It's tedious being an opposition spokesman. You have to do one subject - you can't suddenly say, ‘Sorry I'm not here next week, I'm in a forest somewhere in West Africa'.”

On the notion of being Chancellor now:

“It's a pity I'm not chancellor at a time like this because I like a crisis. It gets the adrenalin going. This one really is tricky, so it would be fun to be involved.”

On the notion of being Chancellor in the future:

“It's rather fanciful to go down that route, but everybody who is offered the chancellorship thinks about it and of course I wouldn't just turn it down peremptorily.”

Boris breaks ranks with party on illegal immigrants

London Mayor Boris Johnson has broken ranks with party policy by suggesting that there should be an amnesty for illegal immigrants, of which 400,000 of the country's estimated 700,000 live in London..

The story broke on this evening's Channel 4 News.

Here's what he had to say, according to the transcript issued by Channel 4:

“What I want is to lead a debate about how sensibly to deal with the 400, 000 people who are living here (London) and working here illegally... What I want to do is to commission a study by my own economics team here at the Greater London Authority into the possibility. We want to look in detail at what the economic impact of such an earned amnesty system would be.

“There are about 400,000 in London.  That's a huge number. In principle these people have done the wrong thing: they’ve broken the law. In principle they should all be taken and sent back to their place of origin, that's the right thing to do .. (but) unfortunately it is just not going to happen…”

Asking the question: “How do you cope with people who have been here a long time, the huge numbers of people living here below the line, below the radar, not entering the economy, not able to play a full part in society?”, he said: “Should we have a mass programme of expulsions, because that hasn’t worked: it's legally incredibly difficult, (and) it's expensive for the state, or should we see if we can develop a sensible system of earned amnesty, so after a substantial period of time - and I would say more than five years - you can, in principle demonstrate your commitment to this society and to this economy. And you can earn your right to stay here.”

However he added: “What I emphatically don’t want to do is to set up incentives for illegal immigration. You don't want to create moral hazard, but I think you should have a system whereby people who have been here for a long time can earn a way out of the mess they're in.”

Talking of the financial benefits, Mr Johnson said:  “And the advantage of that is not just that you regularise them - and you bring them into society and you decriminalise them - but also of course you increase your tax base... In Spain when they did this they hugely increased the revenues available to the Spanish exchequer from people who were suddenly entering the economy legally and could be taxed.”

But: “There’s got to be a very substantial period in which they have been in this country. I think that we could have other hoops that they might have to go through in order to be able to quality for an earned amnesty scheme. For instance, it might be necessary to have a clean criminal record. It might be important that they should go through various citizenship tests, the kind we already have. And there might be some sort of financial obligations that they have to meet as well.”

Sources close to Boris insist that this is no gaffe, but rather something which he has thought through and decided merits looking into, not least because of that potential tax revenue there is to be gained. I understand Boris told shadow home secretary Dominic Grieve in advance of his intention to make this announcement.

It is, of course, not an area over which the London mayor has any formal power; but Boris evidently believes that it is his right as the capital's elected voice to lead a debate on this issue.

The official CCHQ response was:

"We will have to agree to differ on this. One-off amnesties have been tried elsewhere and the evidence is that they do not work, but lead to more."

What do you think?

Jonathan Isaby

> CHANNEL 4 VIDEO

Tax bombshell alert

The battlelines for the political debate over the coming year will be drawn on Monday when Alistair Darling delivers his pre-budget report.

Bookies have cut the odds on a 2009 general election over the last 24 hours, although I am still of the view that a snap contest is highly unlikely - and that is a point of view which Ben Brogan from the Daily Mail is also backing up.

Nonetheless, the Tory campaign will be ratcheted up a notch or two next week and Martha Kearney from Radio 4's World at One programme is claiming an exclusive in the WATO email newsletter which has just arrived in my inbox:

"Westminster will be showered by bombshells on Monday. No, I haven't been watching too many episodes of Spooks. The Conservatives will be blitzing Labour in a new campaign with a distinctively retro feel. In 1992 the party's tax bombshell poster and election broadcast had a devastating impact on Labour. Who came up with the idea? Why, David Cameron's current head of strategy Steve Hilton who was then a young whizzkid at Saatchi and Saatchi."

Jonathan Isaby

In praise of Owen Paterson and the Tory/UUP deal

The news today of a new deal between the Conservatives and Ulster Unionists is extremely welcome.

Whilst Tony Blair-style Northern Ireland clichés about "the hand of history" are probably best avoided, it certainly marks the beginning of a new chapter in Northern Ireland politics and is another step on the road to "normalising" politics in the province.

And it must not be underestimated how much credit is due to Owen Paterson, the shadow Northern Ireland secretary, for bringing this deal about.

It was over a year ago that he quietly began putting feelers out to like-minded individuals in the UUP about seriously bringing the parties closer together again. He then met UUP leader Sir Reg Empey at the beginning of this year, after which a secret working group was established to discuss the matter further.

Amazingly, this close-knit group managed to keep their negotiations secret and out of the media until deciding to float their ideas in public in July.

Throughout the process Owen has been assiduously visiting Northern Ireland every week, often spending two days a week there during recesses. His commitment to what is often regarded as a minor shadow cabinet post has been total.

Praise is also due to David Cameron for being willing to stick his neck out and commit to the project and to Neil Johnston, the area chairman of the Northern Ireland Conservatives (and one-time Tory agent in Battersea) for his role in bringing about the agreement. And then there are others who have long cherished this development such as Jonathan Caine, for many years the Conservative Party's guru on Northern Ireland affairs, who has worked behind the scenes for over a decade to bring the parties closer together.

Further details of the Tory/UUP deal

More details have emerged of the alliance being forged between the Ulster Unionist Party and Conservative Party, which has been warmly welcomed by David Cameron.

The parties have agreed a memorandum of understanding, which the Conservatives have summarised as follows:

Both parties believe that a strong and stable Union of the constituent parts of the United Kingdom offers the best future for all its citizens.

Both parties believe that Northern Ireland has been isolated for too long from the politics of the United Kingdom.

David Cameron hails Ulster Unionist alliance with the Conservatives as a "new political force"

Further to our coverage yesterday of the proposed pact between the Ulster Unionists and the Conservative Party, the UUP Executive last night voted overwhelmingly in favour of an electoral alliance with the Tories for Westminster and European elections.

The first step in the process is the formation of a Conservative and Ulster Unionist Joint Committee to oversee and facilitate the co-operation between the parties. According to a statement put out by the UUP, the committee will be tasked with "bringing forward proposals on manifesto   commitments and the branding of candidates, ensuring that the heritage and   appeal of both parties are respected and that the popular appeal to the   whole Northern Ireland electorate is maximised".

Its first report is due by the end of January, well in advance of the first test for the new arrangement, the European Parliament election in June.

David Cameron has expressed his excitement at the news:

"I am delighted by this agreement between the Conservatives and the Ulster Unionists. It will give all the people of Northern Ireland, for the first time in decades, a new choice in politics. For too long Northern Ireland has been outside of the mainstream of politics in the United Kingdom. This new political force will help change that, and allow everyone in Northern Ireland to participate fully in political life both in Northern Ireland and throughout the United Kingdom."

His comments were echoed by shadow Northern Ireland secretary, Owen Paterson, after a unanimous decision by Northern Ireland Conservative Party members also to back the alliance:

"I am very pleased that a new political force will be created. This will give real influence to all Northern Ireland voters on the crucial day to day issues such as taxation, pensions and the economy."

The UUP has its annual conference on December 6 and there is much speculation that David Cameron will attend in order to hail the new alliance in person.

Jonathan Isaby