Politics Summary: Tuesday, July 20th

The FT reports that the Government’s case for cancelling an £80m loan to a Sheffield engineering company has been undermined after it emerged that David Cameron and Nick Clegg wrongly accused its directors of being unwilling to dilute their shares. Graham Honeyman, Forgemasters’ chief executive, has told the deputy prime minister he was willing to dilute his share, something Mr Clegg has since admitted in a private letter to the businessman. Mr Clegg wrote: “[You] made clear to me your own willingness to dilute your equity share.”

The letter directly contradicts earlier statements by both Mr Clegg and Mr Cameron to the Commons. In a debate last month, Mr Clegg said: “Do I think it is the role of government to help out owners of companies who do not want to dilute their own shareholdings? No I do not.” Mr Cameron has since repeated the point, telling MPs this month: “The question is whether it is an appropriate use of taxpayers’ money to give [the loan] to a business that could raise that money by diluting its shareholding.”

The Independent’s front page asks whether David Cameron’s ‘Big Society’, launched yesterday, is “a genuine vision for Britain’s future – or just empty rhetoric?” The paper contains an annotated version of yesterday’s speech which reads between the lines outlining that the phrase first appeared in a Cameron speech in November 2009 and that the ‘Big Society’ will be “directed from the centre”. Elsewhere in the paper, Steve Richards writes that the Big Society will be seen by historians as a “small footnote” and remarks that, “Normally none of the initiatives announced by Cameron yesterday would have made the national news bulletins, and might have struggled to make it in to local newspapers.” The Financial Times reports that while charities welcomed the plans, they warned the PM that Whitehall cuts threaten to derail his vision. Sir Stuart Etherington, chief executive of the National Council of Voluntary Organisations, welcomed the “big society” bank but said he was “very concerned about the tidal wave of cuts about to hit the sector”. In the Daily Telegraph, Mary Riddell writes that, “[David Cameron] did not mention that many of the voluntary bodies needed to underpin this civic renaissance are being cut to the bone, nor that his much-vaunted ‘big society bank’ may open with reserves of as little as £60 million to underwrite his vision of charities taking over public services from the state.” Steve Bell’s cartoon in the Guardian reminds readers that the concept was described as “Total Bollo*ks” by a senior Conservative minister during the election campaign.

The Daily Telegraph and Daily Mail report remarks by Simon Hughes that the government will give gay couples the right to civil marriage. Mr Hughes predicted that before the next general election, the law will be changed to give an equal right to full marriage. “It would be appropriate in Britain in 2010 to have civil marriage for straight people and gay people equally,” he said. “The state ought to give equality. We’re halfway there. I think we ought to be able to get there in this Parliament.”

The front page of the FT reports that President Obama will raise the issue of BP’s alleged role in lobbying for the release of Libyan terrorist Abdel Basset al-Megrahi when he meets David Cameron today. “There is no suggestion that the Scottish Executive decided to release Megrahi in order to facilitate oil deals for BP,” William Hague, foreign secretary, wrote in a letter to Hillary Clinton on Saturday. Yesterday in an interview with MSNBC, Mrs Clinton said she accepted Mr Hague’s explanation. But the White House said on Monday that the US president and UK prime minister would “likely touch on” the Libyan issue at their first official meeting in the US. Meanwhile, in an article for the Wall Street Journal the Prime Minister writes that he has “never understood the British anxiety about whether the special relationship will survive. The US-UK relationship is strong, because it delivers for both of us. The alliance is not sustained by historical ties or blind loyalty. This is a partnership of choice that serves our national interests today.”

The Guardian‘s front page reports that the White House is revising its Afghanistan strategy to embrace the idea of negotiating with senior members of the Taliban through third parties. The policy had “long been advocated” by Hamid Karzai, the Afghan president, and the British and Pakistani governments, but resisted by Washington which was “lukewarm” towards the idea. “There is a change of mindset in DC,” a senior official in Washington said. “There is no military solution. That means you have to find something else. There was something missing.” Officials have mentioned possible roles in negotiation for the UN and figures such as the veteran UN negotiator, the Algerian Lakhdar Brahimi, who heads, along with the retired US ambassador Thomas Pickering, a New York-based international panel which is looking at such a reconciliation. The Telegraph reports the Kabul Conference, attended by William Hague, is expected to pave the way for the withdrawal of UK and other Nato combat troops by sketching out a gradual transition to local responsibility by 2014.

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