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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LIVERPOOL BUSINESS WANTS END OF POWER BATTLE

 

An agonised call for the elected mayors of Merseyside to stop their power battles and get on with promoting the city region was made at a Downtown event in the city this week.

Many of the movers and shakers in the area were kind enough to give their time to look at the city’s development in the ten years since Capital of Culture and what the next decade has in store.

The overriding desire was for Liverpool City mayor Joe Anderson and City Region mayor Steve Rotheram to end their rivalry, agree on who does what, and get on with attracting business and tourism to the area.

The main frustration focuses on the many agencies that are doing bits and pieces to attract jobs and visitors. The demand is for one point of contact, particularly for tourism. The consensus was that this is a job for the city region. Acknowledging that Liverpool is the brand, it was felt that the city region should have this strategic role.

The way in which successive governments have devolved power in the UK is partly to blame. At the Downtown meeting, it was pointed out that the Scottish Government and Welsh Assembly could put major funding into attracting business and tourism. Aberdeen and Cardiff are building new conference centres on the back of that. In England, limited power and money has been given to a complex model of Local Enterprise Partnerships and Combined Authorities. In Merseyside and Greater Manchester, the structure of elected city regional mayors over the top of the proud cities of Manchester and Liverpool is a recipe for rivalry. There are some signs of tension in Greater Manchester but the ten districts generally rub along together. Merseyside on the other hand has had a controversial history at local government level with Wirral and Southport wanting to break away, not to mention the Militant era. The business community had hoped all that was well in the past. Liverpool is transformed compared to twenty years ago but this model of city and city region mayor couldn’t have been better designed to revive the old dysfunctional problems.

Added to the structural problems we have two strong personalities. Joe Anderson, passionate for his city, has done great work since 2010 but he wanted to move on to the wider city region stage. In his way was his old friend Steve Rotheram. A way out would have been for Joe to take over from Steve as MP for Walton. That elegant solution was blocked by Unite The Union who wanted their man in Walton.

Now business people in Liverpool are confused about the powers of both mayors at a time when they know that more will be expected of them in terms of promoting jobs and tourism as the cuts continue to bite in the public sector.

The Downtown event concluded that the next ten years are going to be harder after the rapid progress of the last decade. Specific attention was paid to the continuing problems of accessing the city centre from the M62 and the need to fill hotels during the week. In this respect the city seems to have an opposite problem to many other places who find attracting weekend guests a challenge.

One of the most striking views at the Downtown meeting was that, in respect of tourists visiting Britain, the national image was being tarnished by Brexit. It was thought this could be an opportunity for the Liverpool City Region to promote itself separately.

Let’s hope the mayoral problems can be sorted out because the meeting agreed that the Liverpool City Region with that to-die-for waterfront, friendly people and the enduring power of the Beatles gives it potentially great prospects for the future.

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SIGNIFICANT BATTLE OVER GAMES

 

GOLDEN GAMES.

Next week business and council chiefs from across the North will meet to demand a fair transport deal for our region. The summit, backed by Downtown in Business, comes in the wake of a watering down of government pledges on connectivity for the Northern Powerhouse (NP) and the simultaneous approval of Crossrail 2 for London.

We’ll see what the response is from ministers. They’ll need to bear in mind that the Conservative conference is in Manchester this autumn and the issue could be an embarrassing one, if not resolved.

But there is another decision to be taken shortly which will indicate whether the NP is still a priority for the government or if the Midlands Engine is to be favoured in the future. The question before ministers is whether to back Birmingham or Liverpool as the UK’s nominee to host the 2022 Commonwealth Games.

The Liverpool bid has brought rivals together like never before. Everton’s proposed new ground at Bramley Moore Dock would host the athletics, Anfield would stage the rugby sevens. Manchester’s velodrome would be the venue for the cycling. Wayne Rooney, who has played in both cities, has just announced his support for the bid which it is hoped will accelerate a billion pounds of investment in the north docks area and 12,000 jobs.

Liverpool would be a great venue for the Games with other venues like St George’s Hall and the ACC Arena also being used. The North West has already staged one of the most successful Commonwealth Games in Manchester in 2002 and ministers should show confidence in our region again.

This is especially the case as bid chairman Brian Barwick and Mayor Joe Anderson have responded to a crisis following the withdrawal of Durban earlier this year. Liverpool originally intended to bid for 2026. Let’s hope doubts over the city’s ability to deliver to the shorter deadline won’t scupper the bid. Particular focus will be on the ability to deliver Everton’s new stadium. That saga has been dragging on for most of this century.

Birmingham already has a stadium which is the home of UK athletics and claims it is 95% ready to host the games although it does not have an Olympic size swimming pool.

Certainty about facilities being ready on time are important, but so are politics. Conservative Andy Street was recently elected as Mayor of the Birmingham City Region and will be expecting the backing of his government in this important decision.

But as the Liverpool Echo said recently “Birmingham? As the Capital of HS2 and so close to the gold-paved streets of London, they don’t need any further help.”

TRUMP’S WINK TO THE NAZIS.

I wrote a couple of weeks ago that the Trump family could rule America till 2033. Now I wonder if Donald Trump will last the year. The laughable clown has now become sinister. There is a difference between fully armed Nazis and Anti-Nazi protesters reacting unwisely to provocation. Trump either doesn’t understand this or regards the far right as part of his blue-collar coalition.

He is alienating the business community although the turmoil doesn’t seem to be affecting the markets. If it does, the cry for Vice President Pence to steady the ship will grow, although such a transition would be fraught with danger particularly after the scenes in Charlottesville.

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THIS SEVERED, NOT SCEPTERED,ISLE

 

MAY FIGHTING ON MULTIPLE FRONTS.

 

“Hung be the heavens with black, yield day to night. Comets importing change of times and states brandish your crystal tresses in the sky” Henry VI Part I.

It seems an appropriate quote for the week when most opposition MPs stood by whilst the government gained parliamentary authority for a hard Brexit from the EU. It was the week when Nicola Sturgeon followed the historic example of past Scottish kings who made trouble on the border when English minds were focused on the continent. It was the week when there was little progress in forming a Northern Ireland government but plenty of talk about uniting the North and South.

There is no doubt that we are in a period of great constitutional uncertainty, unleashed by last year’s EU referendum. That is not good for business in the North nor is the uncertainty caused by the about turn on National Insurance(NI) contributions. After the pasty tax debacle under George Osborne, will Chancellors never learn? A Budget is not a place to road test ideas, only to withdraw them. The near equalisation of NI was a fair proposal but it was also a breach of an election promise and against the Tory instinct to help the self-employed. It was always going to meet with massive opposition, particularly because Tory backbenchers feel they can throw their weight around because of the feeble opposition.

“NO PROBLEM WITH A REFERENDUM”.

Perhaps Nicola Sturgeon acted on Labour leader Jeremy Corbyn’s latest careless word stream in announcing her intention to try and trigger a second referendum on Scottish independence, although I doubt it.

It is a massive gamble by the normally able leader. Was she pushed into it by SNP zealots? More likely she sees Brexit uncertainty as the last hope for an independent Scotland. The economic case against it is growing as North Sea oil runs out and the Scottish deficit rises. Trading on the vote to Remain in Scotland and the huge uncertainty of the UK Brexit negotiations, Sturgeon wants the vote before the end of the talks.

She is likely to be disappointed. The Prime Minister is unlikely to follow the practice of the Spanish government who just refuse Catalonia an independence vote, but she will likely stall for time. It is most likely a second referendum will follow the UK’s exit from the EU if it is held at all. Much will depend on the level of justifiable anger among Scottish remainers.

The further problem for the SNP is that they tend to exaggerate the level of support they have for remaining in/re-joining the EU. The Commission has made it clear it will only deal with one state, the UK, during the talks. If Scotland were to become independent it might have to join the end of the applicant queue, join the Euro and face the opposition of Spain who don’t want to set a precedent for Catalonian independence.

That is one part of our unhappy state.

SINN FEIN’S SUPPORT POST BREXIT.

The fact that Sinn Fein have nearly got parity with Unionists in the Northern Ireland Assembly following the recent elections is another consequence of the Brexit vote. A united Ireland inside the EU is an increasingly attractive proposition for some waverers. That mood will only be strengthened if a hard border between Northern Ireland and the Irish Republic is the result of the UK Brexit talks. Another part of our unhappy state.

OVER THE CLIFF.

Finally, we come to the UK where England plays the major part. Ministers make optimistic noises about how it is in everyone’s interest to allow economic reality to overcome politics in the talks. That wasn’t the case in the Referendum where people’s feelings about immigration and alienation overwhelmed the strong economic case for staying in.

Our European friends feel mightily offended. Expect an early and possibly decisive clash on the divorce bill.

 

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