BUDGET EXPOSES BREXIT MADNESS

 

 

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BREXIT WOES.

In his Budget the Chancellor set aside three billion pounds more for the mounting cost of Brexit. Three billion pounds that could have been spent on the NHS (as promised by the Leavers) being put aside for more lawyers and civil servants to deal with the complexity of leaving. Being put aside to build huge car parks at Dover to cope with the hundreds of lorries held up by customs controls. And let us not forget the £40bn exit bill.

But Brexit is hitting us in a far more serious and widespread way. Look at the woeful forecasts for growth and productivity. It is true that these problems pre-date the EU Referendum, but I suggest the dramatic worsening of the forecasts are related to the uncertainties of Brexit and the perception that the UK is cutting itself adrift from the EU, many of whose members are in the Eurozone where the currency has strengthened considerably in the last year.

It is almost too late for the British people to wake up and turn against Brexit. The warnings are there for anyone who wants to see. This week the European Banking Authority and European Medicines Agency were relocated out of the UK. The latter is the most serious and will be a blow to our pharmaceutical industry quite apart from the fact that we will need to create our own expensive drug regulation body. The government should have faced far more criticism for this. They thought the future of these agencies would be part of Brexit bargaining. The arrogance! The ignorance! It was never going to be possible to keep EU bodies like these in a UK outside the EU.

Oh! but we will be playing on the global stage in the future say the Leavers. Is that the stage where the UK has just lost its place on the International Court of Justice?

PHIL SAVES THE DAY.

As I said last week, I respect the Chancellor. In a Cabinet of misfits his calm integrity stands out. After the Budget perhaps all the hysteria of him getting sacked and Theresa not surviving till Christmas will calm down.

This lot are in it for the long run. Locked into the messy Brexit process and tinkering with a weak economy, but still there. After all, where is the threat. Tory Remainer rebels probably lack the courage to torpedo Brexit and the government can always on Labour MPs like Frank Field and Kate Hoey to come to their aid. Meanwhile Shadow Chancellor John McDonnell struggles to convince us that Labour’s programme could be paid for without hugely adding to the National Debt. It pains me to say it, but the Lib Dems under Vince Cable seem to be fading away just when we need a strong party for Europe.

The Chancellor took some action on the immediate issues facing the country. Housing, Universal Benefit and the NHS but he is locked into Tory ideology by not sanctioning local councils to undertake a massive programme of house building. He is also averse to general tax increases, but why? A cross party panel of voters in Bury voted unanimously for such a move on Newsnight after the Chancellor had sat down.

Thank heavens the Chancellor has stuck with the £85,000 limit on VAT, but for how long will micro businesses be spared the bureaucracy of quarterly accounting. The moves on business rates have been generally welcomed but three-year reviews may be a mixed blessing, as will stamp duty relief for first time buyers. Will youngsters benefit or will house prices just rise. Council house building is the answer.

It now seems highly unlikely the Chancellor will be sacked now that he is “Eeyore No More” according to the Mail. So, the government is set to stagger on as the darkening days bring the reality of the consequences of Brexit ever closer.

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BREXIT CONSEQUENCES BEGIN TO BITE.

 

BOTH BREXITEERS SHOULD BE OUT OF THE CABINET.

A government weakened by scandal and divided over its approach to Europe continues with its ill-starred attempt to leave the European Union.

One leading Brexiteer Cabinet Minister Priti Patel has resigned, but another, Boris Johnson is still in place despite risking extending the detention of a British national in Iran.

Immigrant workers, vital to our caring services, are staying away, jobs are going at British Aerospace in Lancashire and Vauxhall in Ellesmere Port. Both industries rely on the easy movement of parts across borders. Thousands of lawyers and civil servants are being taken on to deal with the whole miserable negative exercise of Brexit. (No doubt their wages will be coming out of the £350m a week that was promised for the NHS.) The port of Dover is making plans for the huge congestion that will build up after March 2019.

So how is all this affecting the heart of the Northern Powerhouse? What is the economic outlook in Greater Manchester as the Budget approaches? I’ve been testing economic opinion which indicates that the crash that was forecast immediately after the EU referendum didn’t happen because of a credit boom and the growth of car leasing. It is felt that is now coming to an end as inflation and now the rise in interest rates kicks in. There is a fall in business confidence amidst the chronic Brexit uncertainty with a demand that the 2019-21 transitional agreement be broadly in line with the final agreement.

Northern economists believe we are looking at a growth rate of 1.5% not 2.5% that was previously hoped for. Looking further into the future we need to prepare for automation, robotics and paying more for UK workers as immigration falls.

In Greater Manchester next year jobs growth is expected to be flat. Employment in retail and financial services will be weak. Mike Blackburn, boss of the Local Enterprise Partnership, is worried that ministers don’t realise the impact Brexit will have on an area which exports 58% of its goods to the EU compared to a national average of 42%. He wants powers returned from the EU devolved to the North.

The Chancellor will be under severe pressure in the Budget to do more on housing. Steve Rumbelow, CEO of Rochdale Council, wants a major programme of council house building. He points out that permission for 50,000 houses in Greater Manchester are not being exercised.

Joanne Roney has had a quiet start since succeeding Sir Howard Bernstein as CEO of Manchester Council. She has indicated her priority is people rather than infrastructure development which characterised her predecessor’s tenure. She identified poor school starts for a large section of Manchester pupils fed into poor GCSE performance leaving colleges to teach Level 2 skills.

Eamonn Boylan is charged with looking at the picture across Greater Manchester as CEO of the Combined Authority. The spatial strategy which deals with the use of green belt and brownfield land is being rewritten after running into opposition from Mayor Burnham, is being rewritten.

Boylan points out the devolution deal is much more about powers than giving the city region money. Promises over devolving power over adult skills had still not been delivered. Local politicians and officers had many bright ideas about what could be done locally. For instance, there was an abundance of advice on how to get to university but very little on taking up vocational courses.

So that’s a sample of the thinking of people charged with putting the concept of the Northern Powerhouse into reality. But they are handicapped by the shadow of Brexit. Let’s hope for a substantial change in popular opinion that would allow Labour to oppose our leaving the EU and we could have an Exit to Brexit.

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COUNCILS UNDER THE SPOTLIGHT NO MORE

 

THE EMPTY TOWN HALL PRESS SEATS.

It is very sad that the Oldham Chronicle has ceased publication after 150 years. It is the latest local paper to fall victim to the surge in on-line advertising and falling readership. For years local newspaper owners have cut the journalists to save costs and then been surprised when the thin content drove away even more readers. Most local papers used to have a correspondent who was an expert on local government and aware of what was going on at the Town Hall. Now they are nearly all gone. The media concentrates excessively on national politicians leaving the leaders, even of some large cities, largely unknown.

The assertion is made that local politics is boring. That is lazy thinking by people who are not prepared to scrutinise the way billions of pounds of our money is spent. It is true that people in one council area don’t really care about what goes on next door but in the great days of local papers, they were the go to places for people to get information on their council alongside coverage of other authorities.

Does this matter? After all a new world has opened on line with a vast range of people offering their opinions about what is going on at national and local level. This blog is one of them. But we will miss the dedicated, independent local government correspondents who exposed scandals like Newcastle’s John Poulson and Westminster’s Dame Shirley Porter. Town Halls still provide many of the services we rely on and are often left to sort out the consequences of ill thought through Whitehall decisions.

But who is keeping an eye on our councillors? Council meetings are rarely reported. The Cabinet system has left most councillors with little to do. The scrutiny they are meant to carry out is a pale shadow of the Westminster Select Committee system it was meant to replicate at a local level.

So, can we rely on central government to do the job? Not really. Eric Pickles, the worst Local Government Secretary in recent history, abolished the Audit Commission. It was responsible for audit and inspection of local government. It reported publicly.

The vast majority of councillors and officers do a great job in difficult circumstances. They are subject to big cuts in their budgets and are dealing first hand with tricky personal services like allocating school places to children and elderly people to a care home.

That said local relationships and big money contracts can lead to corruption. Who’s going to report it consistently and professionally to a wide audience in the future? If the answer is nobody then we should worry.

HAMMOND AND THE NORTHERN POWERHOUSE.

Well at least the, Downtown inspired, crisis conference on the future of the Northern Powerhouse(NP) managed to get the Chancellor to come north this week.

Philip Hammond can be in no doubt at the anger directed towards the Transport Secretary who simultaneously cut back on promises to northern rail while giving the go ahead for Crossrail 2 in London. But it led to no promises while he was here, just a hint that there might be something in the Budget.

Well, Phil the Till, there better be or the NP will be dead in the water.

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REMEMBER THE ROCHDALE CHIPPY CHANCELLOR!

 

THE BUDGET AND BUSINESS RATES.

The coverage of the row over the hike in business rates has shown once again that the media generally sees things from a London and south of England perspective.

There are rumours that the Chancellor is going to take steps to soften the blow of this overdue review of business rates. If he does, it will mean he is not listening to the wise and under reported views of the leader of Rochdale Council. Richard Farnell has pointed out that he knows a chippy in Rochdale that is paying more per square metre than Harrods and says the south is squealing because it is being asked to pay its fair share. Farnell claims that most businesses in greater Manchester will be better off. Spot on Richard. Not before time this review is reflecting the soaring value of property in the overheated south eastern economy whereas some parts of the North have seen property values decrease. That should be reflected in what firms have to pay.

It is true that southern businesses shouldn’t be subjected to huge rises all at once, but the answer to that is for gutless politicians to review business rates more regularly irrespective of whether there is an election on the horizon. It is also true that we need to review the whole system to reflect the growth of on-line businesses that pay nothing, but that is for the future. If the Chancellor gives concessions next week it will be a victory for the effective southern Tory lobbying exercise and for south centric reporting by the media.

MAJOR BUDGET TASKS.

As we saw in his first autumn statement, Chancellor Philip Hammond is not inclined to dramatic and colourful gestures. Indeed, his most surprising announcement in November was to say that this will be the last spring Budget. Signals have been sent out that rebadged austerity is to continue with departments told to find savings in the run up to the next election.

It is true that the national debt stands at £1.8 trillion and the deficit is on track to be £68bn this year, but if this means we are set for a cautious budget then major problems facing the nation will continue to get worse.

Leaving the enormous uncertainties of the Brexit negotiations to one side there is a widespread belief that the government’s recent announcements on housing and skills are not adequate. The crisis in the NHS and particularly social care are laid bare on a daily basis. On the latter point, will we see the Chancellor break with caution and raise the possibility of dipping into people’s assets after they die to fund the rising cost of social care? The political problem is that, in opposition in 2007, the Tories denounced the suggestion, proposed by Labour, as a “death tax” and unveiled posters with the slogan “RIP OFF”.

However, some courage is required and with all the opposition parties so weak at the moment, there is no excuse for a lack of political courage in the budget.

GORTON PARLIAMENTARY SELECTION.

If Labour is serious about having MPs who reflect the area, then an Asian candidate should be chosen for the Gorton seat left vacant by the death of Sir Gerald Kaufman.

Although North West MEP, Afzal Khan, is the frontrunner, don’t be surprised if someone from outside that constituency or even Greater Manchester is chosen to avoid internal rivalries.

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