Wednesday, 27 June 2012

Morning briefing..


The Treasury denies it panicked, but no one can quite understand the logic of announcing a U-turn on the day your enemy suggested it. That the Cabinet weren't consulted and Justine Greening was in the dark about it suggests undue haste.  

Sadly for Ed Balls, the sketch writers seem to think Mr Osborne had the better of him in the Commons. But in Labour HQ there was bafflement at the Tory tactics. A few months ago Ed Miliband and his aides would have scratched their heads and tried to work out what cunning plan George was up to. Now, I'm told, they just laugh.

U-turn features prominently in the headlines, as do embarrassment and reversal. We give Mr Osborne the benefit of the doubt in our leader, unlike  the Sun which is grudging in its acknowledgment: Mr Osborne has written a fawning piece for them but that hasn't stopped the Sun from duffing up the Chancellor and the Government in its leader.

The U-turn/well-judged adjustment will prompt Westminster to ponder just what is going on with the Tories. Is it a core vote strategy, as I mention in my column  on the EU referendum this morning? Is it differentiation? In the past few weeks, something has changed. Mr Cameron and Mr Osborne are like actors doing a frantic costume change.    

And in case you missed it, Chloe Smith got herself into a tangle on Channel 4  and Newsnight last night. She refused to reveal when the Chancellor had made the decision on fuel duty, repeating that it had been “under consideration for some time”, and she couldn’t explain how it would be funded. Where’s Fireman Fallon when you need him, eh?


And the Lords reform plans emerge at last today.  We report that Nick Clegg will treat Tory opposition to reform as an act of “bad faith” in the Coalition. But he’ll do so after announcing a series of last minute concessions to critics of his much-cherished proposals for a mainly-elected Second Chamber when he publishes them later today.

These include taxable £300 daily allowances for peers, rather than salaries, and 50 per cent more members, taking the total to 450, rather than 300 as originally proposed. All members of the new upper chamber will be able to work part-time, rather than be expected to be full-time legislators.

The Times has focused on Ed Miliband and Labour’s claim that it backs the proposal in principle, but not the timetable for debate. We’re assured their position has nothing whatsoever to do with hurting the Coalition. Nobody’s convinced.

This hasn’t dampened Nick’s spirits though. Apparently, he told his aides it's 'game on' after Cabinet yesterday. You can read more in the Guardian’s report.

I gather the Lib Dem leader is convinced the Tories are genuine and that Mr Cameron can deliver it, which is surprising given what we know about Tory opposition. Maybe all those rebels will fall away like a summer mist. I'm not sure they will: their dander is up, and as I  blogged yesterday, they are being given discrete signals that it's safe to oppose the Bill, and in particular the programme motion. Indeed, it is said that Mr Cameron has told colleagues privately that he cannot be seen to oppose it but he doesn't mind if others do.


And the bad economic news keeps coming. Yesterday Sir Mervyn King told the Treasury Select Committee:

“When this crisis began in 2007, most people did not believe we would still be here. I don’t think we’re yet half way through this. I’ve always said that and I’m still saying it. My estimate of how long it will take to recover is expanding all the time.”

This is a step up on his previous statements on the health of the economy. Last year, he said the UK was in the middle of “seven lean years” – suggesting a full recovery was within sight in 2014. He also said that the Bank had not ruled out cutting rates from their current historic low of 0.5pc right down to zero. You can read our report here .


Meanwhile, over in the eurozone Angela Merkel flies to Paris to meet François Hollande today. They hope to forge a “concrete path” for Europe. Yesterday a blueprint for a eurozone political federation was unveiled. It'll be built over a decade entailing four stages and that will be fleshed out by the heads of the four of the main European institutions.  The Guardian says the battle over the detail starts tomorrow.

The FT  - following our story yesterday about Peter Sands and his EU memo to the PM - reports that the City of London is taking fright at Dave’s interaction with the EU. The Corporation believes that six out of the seven “safeguards” Mr Cameron has laid down were either unnecessary or potentially harmful to London’s commercial interests. The FT’s leader column  says this “undercuts the government’s whole negotiating strategy.”


On the home front, Michael Gove is being accused of a U-turn over his O-levels plans. He hinted yesterday that he may not introduce a new CSE-type exam by saying every child would have the opportunity to take the tougher exam.

Aides later explained that he wanted "no separation of sheep and goats" and suggested that slower learners could simply take the O-level later in their school lives. They denied this was a "watering-down" of his proposals announced last week. You can read more in our report.  


Nick Clegg will delight the cities of Birmingham, South Tyneside and Northumberland among others today by drawing attention to the fact they are Britain's youth unemployment hotspots.

At 9am at the Royal Society. He’ll say:

“Youth unemployment is a national problem but it is more acute in certain places. Maybe inner city areas with high levels of disadvantage, rural communities where businesses are struggling to take people on, former mining towns at the sharp end of industrial decline. Whatever the reason, these are the toughest parts of the country to be young, down, and out.”

But he’s got a plan. He’s offering to bring forward the wage subsidy and provide more training and coaching for young people.

Conveniently, the NEET figures are also out today.  


Meanwhile, we’ve splashed  on proof that foreign students are being offered places at top British universities with far lower A-level grades than school pupils in this country. Our undercover reporters caught the official agent in Beijing for Russell Group universities claiming that she could secure oversubscribed places for a Chinese student purporting to have scored three C grades in their A-levels - when British students are required to have at least A, A and B.

Dramatic stuff. It’ll be interesting to see how the Government - and David Willetts in particular - responds. We report  that Mr Willetts has been lobbying privately for foreign students to be excluded from the immigration numbers, but Damian Green has publicly hit back. Yesterday Mr Green told the Commons business, innovation and skills committee that the idea “doesn’t accord with any kind of common sense”.


And finally,  a small but telling thing to watch for today will be the publication of the Home Affairs Select Committee report on the appointment of Theresa May’s preferred candidate for Chief Inspector of Constabulary, Tom Winsor.

He’s the author of recent controversial report on police pay and conditions and didn’t go down too well in yesterday’s hearing. If the Committee recommends against him, many believe Mrs May will ram through the appointment anyway. Watch this space.


Labour MP Jamie Reed:

“@jreedmp: Tory MPs eh? Fuel duty eh? Rhymes with 'cumquats'. A word, if nothing, we don't hear enough of.”



Latest YouGov/The Sun results: Conservatives 34%, Labour 42%, Lib Dems 11%, UKIP 7%

Overall government approval rating: -36


In The Telegraph

Benedict Brogan:  Winks and nudges are no way to run a European policy

Paul Bew:  What shaking hands with Queen Elizabeth means to Sinn Fein

Leader:  The NHS is paying for Labour’s dodgy deals

Leader:  Duty freeze

Best of the rest

Nick Clegg in the Financial Times: Be alive to the risks and rewards of a banking union

Danny Finkelstein in the Times: People can take the pain if they share the gain

Christina Patterson in the Independent: The painful truth is that we have too many hospitals 

Simon Jenkins in the Guardian: Despite the Queen's handshake with Martin McGuinness there is little reconciliation 


Today:  House of Lords Reform Bill published

Today: The Evening Standard hosts a  public debate on London's 'aviation crisis'. Westminster, London

Today: Andrew Lansley gives a speech at the Commissioning Conference 2012

8.45am: Nick Clegg is speaking at the CBI jobs summit.  The Royal Society, 6-9 Carlton House Terrace, London

9.30am: Schools Minister Nick Gibb and Charlie Taylor, the Government’s Behaviour Tsar, appear before the Education Select Committee to discuss behaviour in schools. Wilson Room, Portcullis House

11am: Iain Duncan Smith delivers speech on welfare reform at U.S. think tank. Heritage Foundation, Washington, DC

11.30am: Wales Questions

12pm: David Cameron at PMQs

12pm: The Home Affairs Committee publishes its report on the Appointment of Her Majesty’s Chief Inspector of Constabulary

2.30pm: Francis Maude appears before the Defence Select Committee to discuss defence and cyber-security. Wilson Room, Portcullis House

4.15pm: Lin Homer, the chief executive and Permanent Secretary of HM Revenue and Customs, Dave Hartnett, Permanent Secretary for Tax, HM Revenue and Customs and Jim Harra, Director General Business Tax, HMRC, appear before the Public Accounts Select Committee. Room 15, Palace of Westminster

6.30pm: Dr Arthur Laffer gives a talk his Laffer curve for the IEA. Harvey Goodwin Suite, Church House, Church House Dean's Yard, London

7pm: Boris Johnson takes part in the Talk London debate. Central Methodist Central Hall, Westminster, London