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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22 Responses to “Politics Summary: Tuesday, July 20th”

  1. Anon E Mouse

    Will – This whole Forgemasters thing stinks. Why can’t they go to the banks that we also own the shares in? If the business plan is a good one then there should be no problem, if not the country shouldn’t be backing it.

    The only reason the management in Sheffield think they can get money from the taxpayer for their private company is because Richard Caborn was an apprentice there – it stinks.

    (Forgemasters’ – Nice to see the use of a possessive apostrophe from you though dude…)

  2. 2me2you

    Clegg really has shown his colours and scored an emphatic own goal by not giving forgemasters that loan. I would have thought he would insisted it went through, the backlash he will face in his constituency I hope will be deservedly extreme. As many have said before the clue is that it was supposed to be ‘loan’ and not a grant etc… a loan is paid back – with interest! Throwing potential jobs away is also criminal in times such as these.

    I bet most of us are still left wondering what exactly the big society is. According to Cameron it is to provide “communities with oomph” – did someone say he was relying on cheap rhetoric?! To say this ‘flagship’ policy is only to be rolled out in four areas illustrates that confidence in its ambiguity cannot be all that high! They could so themselves a lot of favours here if they themselves volunteered to pick up litter or man the local soap kitchen – but they won’t. But what ideas could and should ministers pursue?! http://2me2you.wordpress.com/2010/07/20/i-will-embrace-big-society-if/

  3. Hitchin England

    Politics Summary: Clegg's case for cancelling Sheffield forgemasters loan crumbles; Big Society under scrutiny http://bit.ly/awChHA via @lef

  4. Anon E Mouse

    2me2you – “Throwing away potential jobs”? What madness lies behind that remark?

    Forgemasters were going to employ 180 extra people which is £450,000 / job…

    With the type of economics you seem to wish to inflict on the taxpayer makes me glad Labour got a lower turnout at the polls than in 1983 and if the deal was so good why can’t they go to the bank?

    Unless it’s typical New Labour, via Richard Caborn, propping up big business.

    Thank god the Lib Dems are in government now – at least they still have some principals because after being only half way through Mandelson’s book I can tell you Labour lost their’s a long long time ago…

  5. Malcolm Evison

    Politics Summary: Tuesday, July 20th | Left Foot Forward: http://bit.ly/b0sDnY via @addthis

  6. Mr. Sensible

    Mouse? Lib Dems have some principles?

    I don’t think so.

    They sold those and ripped up most of their manifesto and have supported vertually everything they campaigned against.

    And would these be the same banks who Cable has said weren’t being transparrant with people with regard to lone charges? This is an example of public investment supporting private sector growth.

    Anyway, turning to other issues.

    First off, Will, what do you make of George Osborne creating a new quango in the Treasury? First we had the OBR, now we’ve got a new quango for simplifying the tax system.

    Elsewhere, I see that a report today says that only 1 in 10 police officers is actually out helping to fight crime, however, as the Guardian points out some of those other jobs are for things like investigation and specialisms:

    And finally, I see a case has come up that has brought the question of assisted dying back in to focus:

    What is LFF’s view on this?

  7. Anon E Mouse

    Mr.Sensible – “Mad, bad and dangerous”… Labour has sunk to an all time low now Mandelson has blown the gaff.

    When all the Labour lick spittles on this blog were defending Gordon Brown and claiming I was wrong and he was not a bully and a thug they must have known all along how disgracefully Labour were behaving.

    Forget Derek Draper, Charlie Wheelan, Liam Byrne and all those other Labour thugs – Brown and Co. went beyond.

    If you do really support Labour Mr.S (Why????) I wouldn’t be calling anyone else’s principals to be suspect unless of course you’re now saying that Peter Mandelson is lying. No one else at all, including those directly involved is saying that Mandelson is lying – are you?

    PS> You still haven’t answered the question regarding why you believe Forgemasters are a unique private company and shouldn’t go to the bank for the money….

  8. Chris


    The Forgemasters loan was exactly the sort of investment in industry that this country needs to do more of, Clegg obviously hasn’t got a clue or care very much about it. As his line on it has been full of lies and misleading statements, his apologists claimed in the HoC that he was having meetings with the directors when he’d never met them. Clegg claimed that “as a sheffield MP” he knew more about the company than others yet he hadn’t a fucking clue when asked about the loan and came out with lie about diluting the shareholding.

  9. Hank Langston

    Politics Summary: Tuesday, July 20th | Left Foot Forward http://bit.ly/aTGhRn

  10. Simon

    Politics Summary: Tuesday, July 20th | Left Foot Forward http://bit.ly/c6EYwH

  11. james kirk

    Politics Summary: Tuesday, July 20th | Left Foot Forward http://bit.ly/aMLTPr

  12. james o kirk

    Politics Summary: Tuesday, July 20th | Left Foot Forward http://bit.ly/aMLTPr

  13. Marcel Duda

    <b>Politics</b> Summary: Tuesday, July 20th | Left Foot Forward http://goo.gl/fb/yGqIM

  14. anyleftiwonder

    I think the loan was cancelled because it was labours promise ! The condems did not really look into this – like everything else they are trying to rush through before they implode !!

  15. Anon E Mouse

    Chris – Quite agree on the shareholders bit – I believed him I admit and thought that was the reason they didn’t go to the bank..

    Go on then Chris; tell me why you think they should be treated differently from every other private company in the UK and get a government loan.

    Why shouldn’t they go to the bank like rest of us?

    (We do own the bank shares you know…)

  16. Kevin

    cheer up we can all help with the big society and make money at the same time 🙂

  17. Will Straw

    Anon – You may not agree with it but industrial policy has existed in Britain for generations. This includes the granting of occasional loans when there are market failures which prevent banks from providing commercial loans. These normally take place when there are large numbers of jobs at stake in a nationally-important industry. As you may have noticed, there was a huge credit crunch about two years ago with the effects still reverberating around the banking system. That is one reason why firms like Forgemasters may have struggled to get a loan from a bank.

    As to your claim that the Lib Dems have principles, I appreciate that some compromise is necessary in Government but the way they have amounted an about turn on the number 1 issue for voters, the economy, is staggering. No wonder, as per my latest piece, their voters are deserting them in their droves.

    As to your points on Mandelson, as Trevor Kavanagh makes clear in this week’s Spectator, there is very little that is new in the Mandy book. We have known for years that Brown had a temper and that Blair told people what they wanted to hear. I’m not saying that these are admirable traits but they are both human and like most humans far from flawless characters (David Cameron is rumoured to have a bit of a temper, I’m told, for example). But both Blair and Brown were men of conviction when it came to politics. Much more than can be said for Nick Clegg.

  18. Anon E Mouse

    Hi Will – I agree with you on industrial policy in this country – in fact most people aren’t aware that when the Tories were yelling about Gordon Brown lending money to the banks they themselves (under John Major) had leant money to LLoyds (I think)to keep it afloat.

    However Forgemasters should simply issue shares and if the deal is a good one (as a trained toolmaker I appreciate real jobs) the shares will be snapped up. In this country we elect governments, even coalitions, to govern not to lend money to Labour pet projects like the bankers and their favourite private companies.

    The economy was far worse than Cable and Co. expected – Liam Byrne the outgoing Treasury Minister admitted it – so all bets were off and regardless of the current situation Lib Dems will never be able to vote Labour because of Iraq when it comes to it. AV will kill Labour.

    As to Blair and Brown being men of conviction I nearly fell off my chair laughing and although I agree with both you and Kavanagh about there being nothing new in Mandelson’s book I seem to remember the outright denials from people on this blog attacking me for my suggestion that Brown was a dysfunctional bully.

    As it stands I am waiting for Shamik to give me a public apology for constantly saying I was wrong about Brown when Mandelson has shown I was way more than right and I was banging on about him from the John Smith days – never liked the man.

    Anyway take care dude – as for Nick Clegg the man’s always been a Tory as far as I can see…

  19. Casey Vanderpool

    Politics Summary: Tuesday, July 20th | Left Foot Forward http://bit.ly/akkzuP

  20. Mr. Sensible

    Mr Mouse, these are the same banks who Vince Cable said were ripping people off.

    And since we now know that the directors were in fact prepared to dilute their shairs…

    And, Mr Mouse, if the economy was in a worse state than Clegg and Cable recognized, why did the Office for Budget Responsibility say that the deficit was in fact lower than Darling himself had forecast?

  21. Anon E Mouse

    Mr.Sensible – The deficit was indeed lower than Darling had predicted but that’s not my point – it’s still enormous and if you watch the next week or so you’ll see that government departments were just making stuff up regarding their stupid deficit plan.

    My complaint is with that useless Gordon Brown and the way he ran the Labour Party – not Darling who would have both imposed huge cuts AND raised VAT and rightly so.

    Darling is a decent honest man and because of that Gordon Brown had his Labour Party cronies and bullies attack him. Who said that? Darling himself when he said the “Forces of hell were unleashed” (against him) by Brown and Co.

    On this (so called) “Evidence Based” blog the people who make their posts seem to completely ignore the evidence before them – you know I always produce truthful statements to back up my position so I ask you this Mr.S;

    When did the board of Sheffield ForgeMasters Ltd convene and discuss the issuing of shares; what was the percentage of the share issue in respect to the board’s individual holdings and what was the total value of the issue?

    I still see no evidence other than Labour supporting big business again. If you can produce facts to prove what you say is true I’ll believe it but until then I say the fact a Labour government minister who worked there was setting up the deal stinks…

  22. Mr. Sensible

    “When did the board of Sheffield ForgeMasters Ltd convene and discuss the issuing of shares; what was the percentage of the share issue in respect to the board’s individual holdings and what was the total value of the issue?”

    You ought to ask Mr Clegg that.

    And the fact is, not only will these cuts effect frontline services, but they could also have us back in recession.

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