Grave Grayling error costs the taxpayer £33 Million

The breaking news this morning is that Chris Grayling’s Department for Transport has reached a settlement for £33 million with Eurotunnel. It comes after the Transport Secretary awarded contracts un-competitively to Eurotunnel’s rivals. The company threatened to sue the department if it went ahead as planned.

Last year, Eurotunnel transported nearly 1.7 million trucks in 2018 and ran over 2,077 freight train services.

Chris Grayling had the following to say:


“While it is disappointing that Eurotunnel chose to take legal action on contracts in place to ensure the smooth supply of vital medicines, I am pleased that this agreement will ensure the Channel tunnel is ready for a post-Brexit world,”

Guardian

Just last month Seaborne Freight’s contract was cancelled after the Department agreed a £14 million deal to run medical supplies from Ramsgate to Belgium in the case of no-deal. Seaborne Freight had no ferries and Ramsgate port was not fit to run ferries, after a deal with the council to dredge the port fell through at the 11th hour.

Eurotunnel contended that the tender process was illegal in the case that was brought to the high court.

‘Ending part-privatisation of probation services will cost at least £171 million.’

It can also be revealed that Grayling’s failed part-privatisation of the probation service has been strongly criticsed by the National Audit Office.

As supervision by probation has been extended to those serving under 12 months, the number of recalls to prison has increased by 47%.

By March 2018, CRCs faced collective losses of £294 million over the life of the contracts, compared to expected profits of £269 million, increasing the risk of providers withdrawing services, performance deteriorating further and potentially multiple providers becoming insolvent.

National Audit Office

Amyas Morse has been deeply sceptical of the part-privatisation, citing that the reforms have failed to meet most targets, are sub-standard and have been extremely costly for taxpayers. He added that the ministry had set itself up to fail.

Analysis by Deputy Editor in Chief – Seb Chromiak

It is rye time to call another vote of No Confidence in the Transport Secretary, and it is quite frankly shameful that a Government that sacks a minister over an amendment that is Government policy allows (in the same week) Chris Grayling to survive.

What the man must do in order to receive his P45 I dare not speculate. It is a reflection on a prime minister that is incapable of leadership and effective government, the comments from the NOA say as much. Ladies and Gentlemen this is the new normal, Government officials that are said to represent a party that is efficient in its spending throwing away cash left, right and centre as we pick up the pieces.

Nevertheless it does quite literally beggar belief. I have wrote on the Secretary before and I stand by my comments, though many of his colleagues have attempted, there has been no minister less apt for public office in modern history. Countless damning reports, under his stewardship we saw the transport network come to its knees. The latest two cases add to a resume that is stacked with embarrassment.

This is 2019, this is the new normal, worse still I fear that the worst is yet to come.

Seb Chromiak is Deputy Editor in Chief at TPN and studies at the University of Manchester

Ian Austin MP resigns

Ian Austin, the MP for Dudley North has resigned claiming that Jeremy Corbyn, leader of the Labour party has created a culture of extremism and intolerance. The MP, a critic of the Labour leader had his majority slashed to just 22 at the last election.

Ian Austin will not join the newly formed Independent Group that has collected 11 defector’s, 8 from Labour and the remainder from the Conservative’s. According to a Sky News opinion poll, 10% of people said they would vote for the party should they stand in their constituency, putting them ahead of the Lib Dem’s, with Labour on 26% and the Tories on 32%.

The MP’s have announced that they will not call by-elections in their constituences, something that has infuriated local constituents, and something that until recently was unheard of.

The resignations have come at a time when Brexit talks continue to stutter, as Theresa May is expected to announce that she has failed to secure any concessions, despite reitterating that she needs legally binding changes to the backstop legal text. Brussels has once again rejected any such changes and with no such compromises forthcoming and the Houses of Common’s rejecting her deal, we look all set to crash out without a deal.

A no-deal Brexit would likely mean that a General Election is called.

The resignation comes after an announcement from the Labour party in that it will consult on extending the right of constituents to petition to recall their MPs if they change parties.

Labour says this will be part of a radical program to reform British democracy that will culminate in a Constitutional Convention to radically democratise politics and power in our country.

Jon Trickett MP, Labour’s Shadow Minister for the Cabinet Office, said:

“Power comes from the people but for too long the overwhelming majority have been shut out. That’s why trust in politics and in elites is rightly falling. “Communities should not have to wait for up to five years to act if they feel their MP is not properly representing their interests, especially with the restrictions of the Fixed Term Parliament Act. “This proposed reform has the dramatic potential to empower citizens and will be one of many measures the Labour Party is planning to consult on and announce that will change the way politics in this country is done”.

Analysis by Deputy Editor Seb Chromiak

Though Austin has confirmed he will not join the independent group, a vote with this shambolic Tory government makes an MP complicit in the cruel policy that the Tories are hellbent on pursuing.

It is quite clear that the Independent group are trying to pull politics back into the centre ground, with members strictly following an ideology of the status-quo. I believe that we will see Umunna et al, fight against the renationalisation of industry and reducing the power of finance in the City of London over Westminster politics. This neglects all political trends, the polarisation of our politics and the emergence of Jeremy Corbyn’s politics is a product of the very thing they stand for, the status quo. That will not, however, stop the backers from flooding the party with cash, they represent a moderate conservatism that big-business longs for.

That is not to say that Labour and particularly, Jeremy Corbyn should avoid criticism. Quite the opposite there must now be a sharp evaluation of how the party goes forward, reiterating the commitment to stamp out anti-semitism that regularly makes the headlines, though this must be followed by action. There needs to be a recognition by the leadership that descent in a political party is a fundamental element of democracy, Labour is at risk of losing many well respected and good politicians, Tom Watson for example. Most are in agreement that the economic reforms proposed are essential, but in other areas, the leadership could do better. MP’s have long cried wolf about defecting, so far it is unlikely that they will be a loss to the party, nevertheless, this is hardly a false-alarm.

Sebastian Chromiak is Deputy Editor in Chief at TPN

Twitter Handle: @sebchromiak

Household disposable income £1500 lower today than if the Brexit referendum had not occurred.

The Joseph Rowntree Foundation has revealed that disposable household incomes are around £1500 lower today than they were expected to be had the Brexit referendum not occurred.

This comes in the same week in which it was confirmed that economic growth in the United Kingdom was sluggish, at just 1.3% in 2018, which by the OBR’s predictions makes the U.K. economy £23 billion smaller than the pre-referendum forecast. It comes amidst a global slowdown, as Germany narrowly avoided a technical recession, as exports slowed, one of the fundamental flaws of export-led growth.

As the economy comes stuttering to a halt, the party of supposed prosperity is being tested, the supposed trickle-down effect has failed to materialise, once again, fuelling the belief that neoliberal economics do not work. Unless your measure of success is increased inequality, low investment and increased poverty.

John McDonnell had the following to say,

“The evidence is mounting that the combination of the Government’s shambolic handling of Brexit and nine years of austerity is causing real damage to our economy.

“Business investment has been falling for months now, as uncertainty and the fear of No Deal cause immediate damage to confidence.

More concerning is how household debt is fuelling the little growth that exists, in March 2012, total household debt stood at £1,518.5bn in today’s prices compared with £1,630.1bn in 2017. This implies that U.K. households are having to borrow to fund spending, this is closely linked with the fact that real term wages rose just 0.7% over the same period. Before 2016, U.K. households were net savers, but now we are partnered only with Canada in the G7, as two countries that are net borrowers. More striking is the fact that Germany’s financial saving ratio is positive 35%.

All competing scenarios of how the political parties envision Brexit to be delivered will cost U.K. households, further still, it is yet to be revealed how May’s deal would affect economic growth. Though a no-deal scenario as envisioned by the extremist European Research Group would mean that the British economy would retract by 8% in comparison to staying in the EU.

Project Fear this, Project Fear that, the numbers are there for all to see, it is time for the people of Britain to do the maths.

Broken Britain – As the political system is crumbling, more democracy is not the answer

The 2015 coalition government was a warning that the political system is broken, Giovanni Sartori predicted as much.

The current crisis in British politics seems to have no end, it is almost certain that however Brexit concludes it will continue to divide the nation, which has been accompanied by an increase in the calls for general elections to resolve impasses. Impasses which have commonly been associated with Southern European politics, where political check-mate is resolved with a return to the polls. There are signs that our democracy is heading in a similar direction, and if the work of Giovanni Sartori is anything to go by, we should brace ourselves for more frequent elections. Worse still, there is a trend, in Germany the deadlock of the elections has meant Angela Merkel sifting power to other parties, Sweden was without a government for 4 months. The contending divisions of how we intend to pursue economic growth will only exacerbate this problem, as cooperation becomes unlikely.

The whole design of the first past the post system is that it is supposed to deliver a clear winner on each occasion, to give parties the opportunity to govern. Yet both in 2010 and in 2017 the electorate returned a damning verdict that no one party is fit to govern by themselves, revealing a deep mistrust in politicians. The years since 2010 have shown that the electorate is lacking confidence in a single party, and hence there have been significant constraints on any party’s power in government. One cannot look past the Iraq war, where a significant majority in the governing party allowed a catastrophic failing of the checks and balances that parliament should offer.

For a two-party system to function, Sartori argues that at each election one party should have a clear chance of winning, as used to be the case in Britain. The emergence of a third-party is signs of a crisis in the political sphere, something we have become familiar with since 2010. In 2010, the Liberal Democrats won 23% of the vote, in an alternative vote plus system as the German’s have, the Tories would have won 275 seats, Labour 234 and Lib Dems 110. In 2017, the Tory majority would have been 13. According to Sartori, the SNP would have had governing potential in 2015 as coalition partners, as did the Lib Dems in 2010, and though UKIP would still have barely gained any seats under proportional representation they still gained over 12% of the vote, making them a threat according to Sartori. They all point to an fractured political system that is broken and in crisis, further still all three election results pose the risk that this is to continue.

There is significance in the fact we have had 2 elections in the last 5 years, more so the latter election, as it has un-earthed an environment where every time a Prime Minister faces an uphill struggle to pass a land-mark policy, there are calls for them to resign. In Spain, as the Socialist Government’s budget fails to pass, a general election has been called for the 28th April. I can only think back to the famous clip from Bristol in 2017, when a BBC reporter’s question on whether we will return to the polls was met with the response, ‘you’re joking, another one, I can’t stand this.’ Which is true, voter fatigue exists, and the instability caused by constant elections is not only bad for business, but also for faith in democracy. In recent times I have supported calling a general election, particularly as the catastrophic mishandling of Brexit has unfolded, yet it is against this mindset that Sartori warns, hence I recognise the dangers. Any attempts to break this cycle, of election after election will meet significant challenges, as opposition party’s continually present the answer to the problem. This in combination with the fact that parties are increasingly polarised and are more likely to use the power of veto, make for turbulent times in U.K. politics. The Italian electorate are all too familiar with this cycle, they’ve had 61 different Prime Ministers since the end of the 2nd World War. The political system in Britain is crumbling, Sartori tells us that more democracy is unlikely to heal this. It may pay off to listen.

Seb Chromiak is Deputy Editor-in-Chief at TPN.

Evidence shows us that devolved powers and money are making a substantial difference. Why further devolution is the next step for Governments

The legislative deadlock that exists in Westminster as a result of the continued chaos over the EU referendum means the case for devolution has never been stronger. It is ironic that regions in the United Kingdom, be that countries such as Scotland or large cities such as Manchester, are wrestling with parliament to take control of budgets and laws. This article breaks down the case for devolution in two key sectors; employment and the environment.

Employment

In the Greater Manchester City region, a key initiative has been to establish the Manchester Employment and Skills Board. This has been important to the Manchester region in giving onus back to employers so that they can identify the skills shortages that exist. This is significant as such businesses have a leading role in the design of what is included on apprenticeship courses. Many U.K. regions have chronic skills shortage, and only in London is the demand for skills greater than in the North West, where the surplus of demand is 25.69%. Furthermore, in all three devolved nations, employment rates have increased faster than the national average. For example, in Scotland in 1999, employment stood at 71.5%, and by 2008 it had jumped to 76.5%. Similar spikes are observed in both Northern Ireland and Wales. Strikingly, according to the Joseph Rowntree foundation, the greatest impact of this has been on women.

The U.K. labour market is extremely diverse, and as is often the case, central Government has been inapt to respond to such issues. The variety of issues that fall to parliament often mean that structural employment issues are cast aside. Local representatives enhance democracy and for devolved regions and nations, they present a more in touch and compassionate approach to policy-making, as they are better placed to understand and respond to such issues.

Environment

The response of US mayors to the election of Donald Trump has been compelling and refreshing, and supports my belief that in the face of a tyrannical national leader, devolved regions can curb that vision. The common vision and resilience of the leaders of the respective cities has promoted the view that whilst party politics can tilt some approaches to politics, others will not be so easily bent. Perhaps this is why central government in the U.K. is so resilient to full devolution, as more left-wing and progressive views tend to spawn in cities.

For instance, Martin Walsh Mayor of Boston said:

The Science hasn’t changed. The urgency hasn’t changed.

Muriel Bowser, Mayor of Washington D.C. added:

As mayors and citizens, we are determined to lead the way on facing the climate crisis

It has been identified that US cities can contribute more than 1/3 of the emissions reductions needed by 2025 to meet the US’ commitments to the Paris agreement. In New York, USA, the Mayor’s office ‘Greener, Greater Building Plan’ was launched in 2009, and has shown marked results. Large buildings currently account for 45% of the cities carbon emissions. The plan is on track to reduce carbon emissions by 4.5% since 2009 and has saved £3 million in energy bills annually.

San Francisco illustrates how targeted laws that have come around because of a comprehensive vision can bring real change to a region. Between 1990 and 2010, the recycling rate increased from 20 to 77%. Initiatives included targeting residential waste, public procurement and the implementation of a colour coded system. This strongly contrasts to the national average in the US, where the recycling rate stood at just 26%.

The full devolution of powers, laws and money is the next significant step for British politics. As we undertake a significant divergence in our nation’s economic prosperity, devolution offers an opportunity to rebalance the economy. Local policy-makers are best fitted to respond to regional issues, and offer a safety-net for our democracy. Elections for local leaders have been shown to produce more comprehensive results, for example with Sadiq Kahn, who was supported by 56.8% of the electorate, in comparison to his nearest rival who gained 43.2%. Andy Burnham received 63% of the vote share.

Though sceptics will point to the lack of turnout, Andy managed to galvanise support across a range of constituencies that voted to leave the EU, despite him campaigning to remain. Devolution is fit to respond to a range of issues, be that in employment or the environment, and particularly in times of crises as have marked the years previous, both in the U.K. and the U.S.

US firms announce that they want relaxed regulations in return for trade deal, including the use of chemicals in beef.

As expected, US firms have announced that they will seek to lower health standards and relax regulations in order to secure a trade deal with the country across the pond. The meat-lobby wants the sale of growth hormone-fed beef, which is currently banned in the U.K. under EU regulations.

There are particularly concerning developments within farming groups that advocate a move away from EU standards, including rules governing genetically modified crops, antibiotics in meats, and pesticides.

The BBC reported that, the pressure does not stop there, and the lobby group’s priorities were outlined in more than 130 comments submitted to the office of US Trade Representative.

Though a trade deal is likely to depend on our future relationship with Europe which is likely to be left to Theresa May’s successor. The legal document says that the future trading relationship will be negotiated in the coming years. Though as Macron and Merkel have both alluded to, a closer trading relationship will mean abiding to European standards, with an emphasis on the fact that the U.K. should not undercut European regulations, be that on tax, the environment or food standards.

It is such differences in culture and values that have prevented the U.S. and the EU on negotiating a comprehensive trade deal thus far in history.

It should be noted that an undercover investigation in Poland has revealed significant flaws in Environmental standards in the EU. Where cows were seen to be in awful conditions without necessary checks, and because of the way that the customs union and single market work, checks will not have taken place, which is a significant worry as Poland exports 80% of its beef. Though the EU response has been effective, with a comprehensive review of Polish agriculture underway with the cooperation of many EU states to resolve the issue.

Those that warned of what would happen and what would be at stake when we prioritised a trade deal with the U.S. over our continued membership with the European Union, were cited as being members of the project fear brigade. Where are those Brexiteers now?

Analysis by Deputy Editor in Chief – Seb Chromiak

Ask yourself if this is what you voted for, more importantly, is this what Brexit voters voted for? Did you vote for the quality of your beef to be lowered and be injected with chemicals and other atrocities? Or did you value the regulations that were enforced by the EU on a 28 country-scale?

In Brexit utopia, this was always the vision that Brexiteers had for the country, to lower standards in order to appease those across the pond. Your welfare is not a priority. Though, there is still time to change the course of direction, with heavy influence from the ERG, it is little wonder that environmentalists are predicting that the U.K. will cosy up to those across the pond. A closer economic relationship with the EU will also maintain regulations and rights, neoliberals will call it red tape, when in fact it should be our red lines.

Mrs May and her meaningless mandate will be rejected in Brussels, this should come as no surprise

My Slovak uncle recently emailed me on Brexit, saying people on the continent had lost their patience with the arrogance of British politicians. He added that, the political state of a country is generally a reflection of the people living within said nation. The Slovak people should know, former President Robert Fico and his gang of bandits have left a national stain on the country. Brexit is heading for a similar direction.

It was telling then that this morning whilst scanning through Twitter, at last European newspapers started to question the sanity of the British parliament. Tagesspiegel in Germany called last nights voting, ‘nothing less than the biggest political crisis on the island since World War II.’ They were deeply cynical of the role that Theresa May has played in escalating and allowing such a situation to unfold.

We have had many fantastic opinion pieces on what Brexit is founded upon, whether it be the vision of an ultra-capitalist state, or fond memories of British imperialism, the reality is, it is now a national embarrassment, that is something that we should collectively acknowledge and own. Week after week Europeans must cringe at the political play that is Westminster politics. This political play is less Oscar Wilde and more infant school, it reeks of havoc and mismanagement, though unlike the fantasy you may see in Palais Garnier, the Tory party is putting on a show in the House of Commons, one that will affect millions of lives. Beth Rigby closing the show last night and calling out Boris Johnson on his endless fantasies and deliberate misinformation as deluded was quite fitting.  

Yesterday’s vote in the House of Common’s on Graham Brady’s amendment is further proof of this, giving Theresa May a mandate to go back to Brussels, to renegotiate. Renegotiate what? The BBC was reporting that Brussel had already prepared a draft statement rejecting said amendment, saying that the legal text was not going to be delved into. Yet, once again it falls onto deaf ears. It is such hubris that has led to the Government pursuing a path of exiting the EU with limited support and consensus on what it should look like. From the offset our redlines have made a deal that was envisioned by Theresa May quite frankly, impossible. The EU responded with, if this is your negotiating position, this is what we can offer.

Mrs May’s unicorn may be riding off to Brussels, but when the EU shun her ‘new mandate’ and they will, the prospect of No Deal looks ever more likely, I reported that Tory Whips were increasingly confident of getting her deal through. Yet reality strikes again, and the PM’s Alice in Wonderland character has come to the end of the line on her deal, she is all out of options, and her unicorn all out of steam. So, as she crawls back to our European counterparts, in the miraculous hope of securing concessions, it is worth grabbing some popcorn, as this nightmare drama is only at the interval.

How globalisation fueled populist electoral shocks

Dani Rodrik once commented that states and markets are compliments, not substitutes, a fact that has seemingly be neglected for years, there are several indicators that suggest globalisation will soon be forced to come to an end.

Populist parties struggled to gain a stranglehold in mainstream elections for years, in 1998, just two governments in Europe had populists making up the power arrangement, in 2018 the figure stands at nine. 1 in 4 Europeans now vote for populist parties. Significantly, until 2008 and the global economic crash, populist vote share was around or under 10%. At which point, there was a distinct political decision to impose austerity. What has unfolded since, should come as no surprise to the political classes. Crude policies such as universal credit and other welfare reforms, have a direct consequence on election day. Needn’t we name, Brexit.

Kevin O’Rourke has long predicted that if states failed to protect the winners and losers from globalisation, they would soon be forced to dismantle global trade links, citing that even in 1914, advanced trading nations had social provisions for the losers of open trading. The choice to pursue neoliberal globalisation at the end of the liberal embedded compromise, has satisfied the criteria to ensure Kevin’s insight is correct. All indicators signal that globalisation is grinding, slowly, to a halt, trade has a share of global GDP has fallen by 3 percentage points from 61%. Multinationals share of global profits is also shrinking, and Foreign Direct Investment is also decreasing.

Nuanced analysis of voting trends suggests that those at risk of the negative effects of globalisation leads people to vote in a populist manor. For example, research at the University of Bologna has suggested that, those counties most heavily exposed to the Chinese import shock, were most likely to vote to leave the European Union, simultaneously listing immigration as their explanatory variable. In America, for every 1% increase in Chinese imports, voters were 2% more likely to vote for Trump. Interestingly, according to the National Centre for Social Research, concern for the economy was at its lowest post-war level on the day of the Brexit vote, the same can’t be said now.

The elites have long over estimated how long they could implement neoliberal policies without consequence, the electorate is biting back, further austerity will do little to change that situation.