Friday, 25 October 2013

Labour u-turn on HS2 imminent..

Good morning. Lord Adonis won't be happy: a Labour U-turn on HS2 seems upon us. Ed Miliband's decision to "sub-contract" the decision on HS2 to Ed Balls is the strongest indication yet that Labour plans to withdraw its support for the project. Mr Balls is a known sceptic. The only remaining obstacle is Labour accept that the railways have a capacity problem: to this end, expect Labour to split the proposed costs of HS2 two ways, between less glamorous capacity improvements on the rail networks and other "policy goodies", most notably housing.
The decision is not yet confirmed, of course, but - forgetting the economics for a moment - the political logic seems irresistible. Labour has "a money problem". By rejecting HS2 and presenting it as a vanity project, Labour judge that they can go a long way to taking the sting out of Tory attacks. And the public is unconvinced by HS2, with even Tories planning to vote for it next week admitting that the Government hasn't done a very good job of making the case. Indeed, if the Government offered a free vote on HS2, far more Tories would vote against it than the expected 60 oir so.
The other thing to note is that Mary Creagh, Labour's new shadow transport secretary, tells the FT today that she is "open" to the idea of renationalising the railways. This suggests that Labour is less worried about the "Red Ed" tag than presenting themselves as on the side of the consumers. The risk, of course, is that the public sees a party reverting to its comfort zone.
We could have progress on energy bills this Parliament after all. Nick Clegg may be willing to sign off on a reduction in green energy levies -The Times says that these could be halved, leading to around £50 being shaved off - as long as these are absorbed into general taxation. The Lib Dems are attracted by the notion that these taxes would be more progressive if paid for out of general taxation. But if the levies are simply transferred to the tax column, then how does the consumer benefit? Energy bill or tax bill, he still pays for the vanity projects of politicians.
There were signs of more Coalition common ground with Mr Clegg's description of Ed Miliband's proposed price freeze as the work of a "24-carat conman". For an analysis of all the suggestions on energy, seeJeremy Warner's piece on why "The power companies are not the bad guys."
Overnight, Labour's Cara Hilton won the Scottish Parliament by-election in Dunfermline, gaining the seat lost to the SNP in 2011. The overall swing to Labour was 7 per cent. They recorded 10,275 votes; the SNP gained 7,402; and the Lib Dems, with 2,852, edged out the Conservatives (2,009) into third. The win will provide cheer for the Better Together campaign, while Labour will believe it provides hope for gains in Scotland in the general election. 
"We are open for business," Mark Carney yesterday said. The Governor of the Bank of England promised households that he will not rush to raise interest rates or withdraw emergency support for banks and businesses. The ONS publish the latest growth figures at 09.30; growth of 0.8 or 0.9 per cent would add to the sense that the recovery is speeding along nicely. But note Mr Carney's warning that the recovery has yet to gain "that traction".
Red Ed consulted a focus group on whether he should be seen in or out of the top half of his £750 Spencer Hart suit, according to the New Statesman - and "women voters thought the young Milibrother looked more prime ministerial in a jacket."
Liam Fox has popped up with another warning about defence cuts. Dr Fox says that "as the economy recovers it will become more difficult to recruit and retain" the reserve soldiers necessary to increase the number from 19,000 to 30,000.
Jonathan Aitken says that one anecdote from his new biography of Margaret Thatcher always goes down particularly well. As Ephraim Hardcastle writes in the Mail, "One day the Iron Lady complimented Tory MP Fergus Montgomery on looking well-groomed. Just been to the hairdresser, he replied. Maggie remarked, knowingly: ‘I expect you had a blow job.’ Aitken thinks she meant blow dry."
The Morning Briefing email is edited by Tim Wigmore. Follow Tim on Twitter

Lucy Powell wants a new Labour MP:
@LucyMPowell: .@OwenJones84 should stand for parliament. I don't agree with him on everything but he's a great advocate #bbcqt
Best of the rest

Philip Collins in The Times - Cop-cameras won’t rebuild trust in the police
**9.30am First estimate of GDP for the third quarter is published by the Office for National Statistics.**
David Cameron attending European Council summit, Brussels.
Health Minister Dan Poulter announcement on doctor revalidation and appraisals.

Judgment on costs to be given in case of Chris Huhne and Vicky Pryce, Old Bailey.