Politics Summary: Tuesday, May 18th

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Jon Cruddas has ruled himself out of the running for the Labour leadership. Writing in today’s Guardian, he says: “Hand on heart, I do not want to be leader of the Labour party or subsequently prime minister. These require certain qualities I do not possess. The role of leader is one of the greatest honours imaginable – but it is not a bauble to aspire for. It is a duty to fulfil. I do not feel that I am in a position to deliver on the hopes and expectations that will be placed in the next leader.” On the role he played in crushing the BNP, he adds: “Standing at the count for my seat in Dagenham almost two weeks ago, I watched as Labour won both parliamentary seats in a borough targeted by the BNP. The council elections saw the BNP wiped out in a borough where they had high hopes. I also saw results come in from Oxford East, Blackburn, seats in Birmingham, and stunning local election results in places like Camden and Islington on the Friday.”

Echoing Gordon Brown in his conference speech of 2003, Mr Cruddas concludes by saying: “Labour has a chance to be bold. And at our boldest, we are Britain’s best hope for a freer more just country. The next few months will decide whether the party is ready to grasp that chance.” On the process for electing Mr Brown’s successor, The Guardian reports that “The Labour national executive committee will meet tomorrow to decide whether to extend the contest to the party’s annual conference in September, or hold an expensive special leadership conference in the summer. Unions are pressing for the longer timetable, doubting that the Liberal-Conservative coalition will fall apart quickly.”

The new Lib Dem/Tory government is to “rush through” £6 billion of cuts on Monday as it starts to hack away at Britain’s record £163bn deficit. The Independent reports that David Laws, new chief secretary to the Treasury, has compiled a “hit list” which includes: curbs on recruitment – a freeze on filling some vacant posts and cutting cost of agency and contract staff could save £1bn-£2bn; the use of consultants; scaling back quangos; doubling the expected savings on IT projects; scrapping ‘wasteful projects’ like identity cards; cutting the bills from 70 major suppliers – renegotiating contracts of 70 goods and services suppliers could save up to £3bn, according to the Tories; lower property costs and squeezing advertising budgets – £50m public-health campaigns may be squeezed. The Guardian quotes a Treasury source as saying: “If you are going to look at waste, you are, by definition, going to look at similar areas around waste, around procurement and around IT. One of the central things this government is saying: let’s get cracking quicker. The previous government identified a whole bunch of waste. It just wasn’t doing anything about it. We want to get on doing it quickly.” However, the government was warned by the Institute for Fiscal Studies that it should “take time in making the cuts”, and consider a five-year spending review instead of the more usual three-year schedule.

The Times reports that more than £750 million of funding earmarked by Lord Mandelson to help Britain’s car and nuclear industry is under threat from the Lib-Con government. It reports that “loans worth £270 million to Vauxhall, £90 million to Sheffield Forgemasters, £20 million to Nissan, and £379 million worth of guarantees to Ford will be reviewed this week by David Laws”. He will decide next week “whether the loans and guarantees represent value for money … the four car and nuclear projects were signed off by the Treasury so will return to the desk of the Chief Secretary for review”. A Treasury source said: “In order for us to reconsider they would have to be considered poor value for money. I have not seen it suggested that they were.” The report adds that the Chancellor once again failed to rule out a rise in VAT: “While Mr Osborne declined to be drawn on whether the Government would announce an increase in VAT in the Budget, he hinted that he would stand by a pre-election pledge to cut corporation tax from 28 per cent to 25 per cent and introduce a cut in the tax rate for smaller firms.”

The Telegraph reports that graduate debts “could rise to £40,000” under new plans unveiled by the Russell Group of elite universities. Britain’s leading universities have called for a rise in tuition fees, arguing that the existing £3,225-a-year limit on fees “should be abolished altogether”, paving the way “for the introduction of a US-style system where fees top £20,000 for sought-after degrees at the best universities”. The Russell Group also says that “interest rates on student loans should rise and middle-class graduates should make bigger contributions to fund bursary programmes for the poorest undergraduates”, with universities insisting that “a rise in interest rates would mean the government could still provide loans to cover the full cost of fees – even if they were almost tripled to £9,000 per year”. The recommendations will be presented to Lord Browne, who is chairing a review of student finance which will report to ministers in the autumn. The group adds that an increase in graduate contributions represents the “only viable option for ensuring sufficient funding for a world-class higher education system”. Left Foot Forward will have a response to the proposals from the National Union of Students later today.

Finally, the High Court has granted an injunction to British Airways, ruling the next wave of strikes by cabin crew illegal – a decision that has stunned the Unite union and angered its leaders. The Guardian reports that the court overturned the overwhelming 81% strike vote because of a technical breach of the 1992 Trade Union Act, “because Unite’s attempts to inform members of the poll result were inadequate”. Joint general secretaries of Unite, Derek Simpson and Tony Woodley, described the decision as “an absolute disgrace”, and that it would now be “all but impossible” to take industrial action in the future. They said: “”This judgment is an absolute disgrace and will rank as a landmark attack on free trade unionism and the right to take industrial action. Its implication is that it is now all but impossible to take legally protected strike action against any employer who wishes to seek an injunction on even the most trivial grounds.” A BA spokesman, however, called the proposed action “extreme and unjustified”, saying: “We are delighted for our customers that Unite’s plans for extreme and unjustified strike action cannot go ahead.” The union will appeal the decision today.

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9 Responses to “Politics Summary: Tuesday, May 18th”

  1. House Of Twits

    RT @leftfootfwd Politics Summary: http://bit.ly/8XqjPg – Cruddas: "I do not want to be Labour leader"

  2. Shamik Das

    A real shame: RT @leftfootfwd: Politics Summary: http://bit.ly/8XqjPg – Cruddas: "I do not want to be Labour leader"


    Politics Summary: Tuesday, May 18th | Left Foot Forward: Jon Cruddas has ruled himself out of the running for the … http://bit.ly/b7LzTs

  4. Fat Bloke on Tour

    Regarding the BA dispute does anyone have any info on the judge involved?

    Is there a pattern developing where a right wing establishment mentalist is generating all these judgements out of the goodness of his inteleect or is something else involved?

    Thuis is the big issue at the moment, not the fact that Mr “Me myself alone” has decided not to “fire up the donkey, I have some windmills to sort out”.

    I fear that with coalition stuffed full of ex bankers and multi-millionaires we will be seeing more of this is the future.

    Basic human right = Ability to withdraw one’s labour.
    Curtailing this through abuse of judicial authority is not very liberal.
    Need to get a response from all the Orange Bookers out there.

    The 1930’s description of a Liberal being a Tory without his kicking boots on is very prescient at the moment.

  5. SadButMadLad

    “And at our boldest, we are Britain’s best hope for a freer more just country.”

    Yes with thousands of petty new laws created. Ignorance of the law is no excuse is standard phrase. But when 3000 new laws are created in 13 years its a bit hard to remember every single one of them.

    “The new Lib Dem/Tory government is to “rush through” £6 billion of cuts on Monday as it starts to hack away at Britain’s record £163bn deficit.”

    Not cuts. Just not spending what Labour was planning on spending. Labour’s plans were to increase spending. Tory’s plans are not to increase spending. However in both cases they aren’t doing enough to fix the natioanl debt itself. The deficit is only in the payments to support the debt. A minor part of the overall problem. The debt itself is absolutly humongous.

    Think of the government as a household. You have an income from salaries (tax) and you outgoing are normal household expenses (social benefits) plus you are paying off a large credit card bill (debt). Like normal credit cards, the interest rate varies with the ability to pay. The interest rate the UK is paying increase the more we don’t service the debt. And like a normal credit card debt, if you only pay off the minimum the debt will still grow – this is what the UK is currently doing.

    In a few years time the debt will have increased and the payments to support the debt will have to increase unless something is done to actually lower the debt itself. Like not spending on projects of dubious value such as the high level of government advertising (eg. Change4Life). If that also means that there will be jobs losses in the public sector then that is only fair as there have been job losses already in the private sector. That doesn’t mean front line services, but it does mean the managers and administrators and pen pushers and form fillers and all the other non productive jobs like Street Football Coordinators.


    Politics Summary: Tuesday, May 18th | Left Foot Forward: Jon Cruddas has ruled himself out of the running for the … http://bit.ly/b7LzTs

  7. Fat Bloke on Tour

    SBML @ 10.10

    Any chance you could move the discussion on from the lightweight, kitchen table Conservatism you seem to specialise in?

    In your parallel world how does anyone buy a house?
    Better to live in a tent and save the money up?
    10 years of misery to get a debt free house?
    That attitude is beyond dog boiling.

    We cannot thrift / cut our way to salvation.
    We have to grow the economy, get the country working again.
    The £6bill cuts is the parable of the “Loaves and the Fishes” in reverse.

    Every public sector worker or private sector worker supplying the public sector has put the brakes on their spending plans for the next 6 months waiting to see what happens.

    I fear Sniffy as CotE will be car crash TV, he is not fit to hold the office but to some people the warning signs were not enough and they actually have to see the wreckage on the road before they will take this onboard.

    9-12 months will make all the difference.

  8. SadButMadLad

    So using the anology of a household, you think that the houeshold should get a higher paid job (higher taxes) to pay the increase in debt. What if there aren’t any higher paid jobs. In other words taxes are pretty high already. In any case the household would still be wise to cut its spending as much as possible to ensure that the debt is paid off as quickly as possible. For some real financial advice watch the reality programmes where people had run up huge credit card bills and how they were taught to pay it off. A government is still run by human beings with all their failings just like a household.

    Where do I get a mortgage from? A bank. Where does the bank get its money from to buy the assest which I will pay back over time. The bank gets it from savings which it invests in loans to business. Where does the saving come from when everyone is spending spending spending? Thats why the banks are’t offering loans to businesses. The banks can get money from each other but there is a limit and new money needs to enter the system and that is via our savings. Yes, I admit there has to be some spending but its not us that needs to do the most spending. Its other countries buying the goods that the UK manufactures. Only a small problem here. The UK’s main industry is now the financial services industry and not manufacturing. And you know what deep doo doo the financial sector is in don’t you.

    The way to grow an economy is not to tax it (think of the phrase “taxed to the hilt”) and give money away in starting up new pet projects but to tax less and regulate less to allow human ingenuity to germinate and grow new businesses. The less tax a business pays the more it can invest in growing and the more it can pay it’s employees. For instance if NI is increased what does a business do? Keep salaries the same and bite the bullet keeping less for itself or lower salaries and keep more for itself. Businesses aren’t usually charities. The corollary of this is that the income from NI lowers as well so the governement doesn’t see the whole amount from the increase in NI rates.

    Another anology to keep you thinking. Businesses survive on cash flow and turnover. Profit is a result of this. A business can either sell one or two very expensive items with a large profit margin, or sell thousands of items with a miniscule profit margin. In both cases the annual profit of both businesses can be the same. Similarly a government can either increase taxes and hope that the same number of people pay the increased amount and no one emmigrates or avoids the tax. Alternatively a government can lower taxes on the basis that that it becomes less profitable to avoid the tax and more people pay it.

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