Afternoon summary
- Paul Drechsler, president of the CBI, has said it would be almost impossible for Britain to get a trade deal if it were outside the EU with all the benefits of being in. In a statement he said:
The UK has prospered within the EU and it would be tough, but more likely impossible, to get a deal from the outside that would replicate all the economic benefits that membership brings to British businesses.
Half-way house relationships like those of Switzerland and Norway have serious drawbacks.
They would give the UK no influence on European market rules despite being bound by them, little or no reduction in the commitment to free movement of labour, and would still mean contributions to the EU budget.
In a speech tonight he is also due to say the risks of leaving the EU are far greater than the risks of staying in.
Yes, there will likely be some degree of uncertainty around future Eurozone integration but that doesn’t come close to that generated by leaving. That is especially the case given the new safeguards secured by the Prime Minister.
The potential risks surrounding the ‘uncertainty of leaving’ would be greater by an order of some magnitude.
- The government has published its report setting out alternatives to EU membership (pdf). It includes this chart, setting out the various relationships Britain could have with the EU. The chart says UK membership of the EU is not the same as standard membership.
That’s all from me for today.
Thanks for the comments.
Updated
On the subject of John McDonnell, an article by George Eaton in this week’s New Statesman renews speculation that he is being lined up to replace Jeremy Corbyn as Labour leader before the 2020 election. Eaton writes:
There is increasing discussion among MPs about whether “a deal” has been struck between the Labour leader and his closest ally. McDonnell, who stood unsuccessfully for the leadership in 2007 and 2010, is now present at “every meeting”. Some believe that this reflects the toll the job has taken on Corbyn (“he just can’t do it on his own”); others suggest that he is preparing to hand over the leadership at some point. McDonnell is said to have “massively expanded” his team and has been frequently visiting constituency parties.
Bloomberg’s Rob Hutton has posted these tweets from the John McDonnell Q&A with Joseph Stiglitz.
Stiglitz theme is that broken market is driving increasing inequality. Much of his focus is on the top one percent.
— Robert Hutton (@RobDotHutton) March 2, 2016
McDonnell swerves Q on whether Labour would make David Beckham poorer. Stiglitz says distinction is between deserving and undeserving rich.
— Robert Hutton (@RobDotHutton) March 2, 2016
Joseph Stiglitz, the Nobel Prize-winning economist and a member of Labour’s economic advisory committee, is giving his a lecture on “Rewriting the rules of the market economy to achieve shared prosperity”. Labour are meant to be sending me some extracts, but they haven’t arrived yet. In the meantime, here are some tweets about what he has been saying.
Prof Joseph Stiglitz (who advised Scot gov on plans for iScotland) delivering @UKLabour 'The New Economics' lecture pic.twitter.com/g6Jji8w47q
— Nick Eardley (@nickeardleybbc) March 2, 2016
.@JosephEStiglitz highlights the enormous growth in inequality & its multiple dimensions inc. wealth, income, health & justice #BBKStiglitz
— Class (@Classthinktank) March 2, 2016
Thatcher & Reagan rewrote rules of market economy - greater liberalisation of market and lower taxes for rich to incentivise hard work 1/2
— UnitePolitics (@Unitepolitics) March 2, 2016
Everyone was meant to get a bigger piece of the pie. But it has failed. All the increase in income has gone to top 10%. #bbkstiglitz 2/2
— UnitePolitics (@Unitepolitics) March 2, 2016
'Since the 1950s, 'the golden age of capitalism', the top 1% has seized for itself around a quarter of all income in the US.' #bbkstiglitz
— UnitePolitics (@Unitepolitics) March 2, 2016
US may be known as land of opportunity, but is one of the countries with the least equality of opportunity. Along with UK. #bbkstiglitz
— UnitePolitics (@Unitepolitics) March 2, 2016
Many other aspects of inequality than income eg lack of access to medicine leads to huge inequalities in health. #BBKStiglitz
— UnitePolitics (@Unitepolitics) March 2, 2016
Stiglitz: Laws of economics not to blame for rising inequality, it's the result of policy decisions
— Nick Eardley (@nickeardleybbc) March 2, 2016
Recent major changes in understandings of inequality - 2008 crash bank bailouts demonstrate 'trickle down' economics don't work #BBKStiglitz
— Class (@Classthinktank) March 2, 2016
That #inequality is unfair/bad economics is now mainstream economic view but not translated into a different political approach #BBKStiglitz
— Class (@Classthinktank) March 2, 2016
Stiglitz: It's time to rewrite rules of economics to return to growth and shared prosperity. Experiment of last 30 years has failed
— Nick Eardley (@nickeardleybbc) March 2, 2016
'We now understand that very unequal societies have slower growth and far greater social problems than more cohesive societies' #bbkstiglitz
— UnitePolitics (@Unitepolitics) March 2, 2016
'The most massive rewriting of the rules behind closed doors that has ever occurred.' Stiglitz on TTIP. #bbkstiglitz
— UnitePolitics (@Unitepolitics) March 2, 2016
Government publishes its 'alternatives to EU membership' report
The government has finally published its 54-page paper on alternatives to EU membership (pdf).
Like Iain Duncan Smith (see 9.11am), Leave.EU is also dismissing it as a “dodgy dossier”. This is from Leave.EU’s head of communications, Andy Wigmore.
It’s pure fiction. Like the last dodgy dossier the government put out, it’s full of lies and false assumptions that had disastrous consequences.
The report says ‘If Britain left Europe and did not have access to the single market there would be a risk to jobs, low prices and investment.’
However, after a Leave vote, the Europhile government will do its best to keep it ‘business as normal’ which would probably mean keeping us in the single market as EEA [European Economic Area - ie, the Norway option] members - meaning businesses would trade on the same terms they do today.
It’s incredibly dubious to claim the only way Britain can survive is as a member of the European Union when there are plenty of countries outside of it that are happy and successful.
Lunchtime summary
- Jeremy Corbyn has accused David Cameron of breaking a promise made in 2013 to deliver tax-free childcare and of making limited progress on a manifesto pledge to extend the number of hours of childcare. At PMQs Cameron also joked about Labour’s economic policy amounting to “Acropolis now”.
- Sir Michael Wilshaw, the head of Ofsted, has said the improvements to England’s education system will be undermined if action is not taken to address teacher shortages. Giving evidence to the Commons education committee he said:
I think what we’ve got to do as a country is to make sure we get more people applying for teaching and training. And we’re not doing that successfully. All the great improvements that we’ve seen over the last few years could be undermined unless we tackle this very serious issue.
- Russia is the only world power that would welcome a British exit from the EU, Philip Hammond has said as the government intensified its warnings about the danger of a vote to leave. The foreign secretary made the point in a speech about the alternatives to EU membership. Hammond also claimed that EU countries would try to undermine the City of London if Britain left the EU.
I think it would be naive of us to suppose that within all 27 countries there wouldn’t be people already looking at the advantages to them of Britain being locked out of the European market. To be blunt, there will be people in Paris, people in Frankfurt today already planning how they can seize the financial services market share in London and grow the business of their own cities if we decide to leave.
And he claimed that some Leave campaigners were prepared to “sacrifice” British jobs in order to cut ties with Brussels.
I know people, there are people out there - they won’t say this publicly - but privately they are prepared to sacrifice jobs and growth in order to be able to get the clampdown on migration from the EU, in order to stop paying into the EU. We need to be honest with the British people about this. My judgment is if the British people have the facts they will make up their own minds.
But it isn’t honest to pretend to the British people, as some have been doing, that we will be able to carry on as if we were still members of the EU with full access to the European markets, nothing will change, our businesses can go on selling and jobs will be safe yet we won’t have to accept freedom of movement, we won’t have to accept irksome EU regulations and we won’t have to contribute to the budget. That is not going to happen, it is not a realistic scenario and the Leave campaign needs to be honest about that.
Britain Stronger in Europe said a comment by the pro-Brexit minister Dominic Raab this morning, in which he said leaving the EU could lead to “slightly higher tariffs” (see 9.11am), showed that “Leave campaigners themselves admit that leaving Europe would raise prices and hit jobs”.
- A House of Lords committee has urged the government to water down the plans in the trade union bill that would cut Labour party funding. A majority of committee members want the rule that will force union members to have to opt in to paying a political levy, instead of just having the option to opt out, to apply just to new people joining unions. Downing Street said: “We will look at the detail of the report, but we set out clearly in our manifesto the proposals which we want to introduce. It is a system that is already operating in Northern Ireland.”
- Lawyers representing the family of a young Tory who killed himself have argued he was subject to “inhuman and degrading treatment” as they sought to widen the scope of an inquest into his death. As the Press Association reports, Elliott Johnson was found dead on railway tracks in Bedfordshire in September. Weeks earlier, he had raised allegations about the way he was being treated within Conservative Way Forward. The Johnson family attended a hearing in Ampthill on Wednesday to argue for the scope of a full inquest be broadened to explore the culture in the Conservative party at the time. Heather Williams, representing them, said that under article three of the Human Rights Act 1998 public authorities were obliged to investigate when there were allegations of inhuman or degrading treatment.
Brandwatch, a firm that carries out social media analytics, has sent me some data about the Twitter comment on today’s PMQs. They monitored 6,532 tweets with the #PMQs hashtag. They say the Cameron ones were 26% positive and 74% negative, and that the Corbyn ones were 20% positive and 80% negative. It is rare for Corbyn to have a worse sentiment rating than Cameron at PMQs, they say.
Updated
Natalie Bennett, the Green party leader, agrees with Jeremy Corbyn about “agency Britain”.
Jeremy Corbyn right about "agency Britain": zero-hours contract, minimum wage jobs - you can't build a life on those. Or good services #PMQs
— Natalie Bennett (@natalieben) March 2, 2016
PMQs - Verdict from the Twitter commentariat
Here is a round-up of what journalists and political commentators are saying about PMQs.
One one point, there is consensus: David Cameron should have ditched the Acropolis Now joke.
From the New Statesman’s George Eaton
This is sound, detailed questioning from Corbyn. #PMQs
— George Eaton (@georgeeaton) March 2, 2016
My #PMQs review: Cameron's Varoufakis jibe throws Corbyn off course https://t.co/1l6Ga3yUTp pic.twitter.com/Rt9bZaGHtr
— George Eaton (@georgeeaton) March 2, 2016
From Sky’s Adam Boulton
Cake walk #PMQs for DC, Tory eurosceps in their box, Lab SNP MPs asking PM to right wrongs rather than attacking him.
— Adam Boulton (@adamboultonSKY) March 2, 2016
From the Independent on Sunday’s John Rentoul
True opposition update: only awkward moments for Cam at #PMQs from David Davis on immig & when Barry Sheerman compared him to Harold Wilson
— John Rentoul (@JohnRentoul) March 2, 2016
From the BBC’s Vicki Young
Maybe Corbyn should have stuck with questions on childcare. Many providers say promises hard to deliver & numbers don't add up #PMQs
— Vicki Young (@VickiYoung01) March 2, 2016
From the Guardian’s Anushka Asthana
Corbyn asks why the free 30 hours not there yet for most. Certainly true that all mums I know thought would be quicker off mark! #pmqs
— Anushka Asthana (@GuardianAnushka) March 2, 2016
From the Independent on Sunday’s Jane Merrick
Cameron gets a laugh out of Yiannis Varoufakis but thousands of parents across country worried about childcare are going WTF? #pmqs
— Jane Merrick (@janemerrick23) March 2, 2016
From the Yorkshire Post’s Kate Proctor
Weak delivery from @jeremycorbyn but serious points on large class sizes, and shortage of teachers. Big issue in Yorkshire #yplive #pmqs
— Kate Proctor (@KateProctorYP) March 2, 2016
From the Spectator’s Isabel Hardman
Why does Corbyn do these themed sessions where he jumps from one problem to another rather than drilling away at one problem?
— Isabel Hardman (@IsabelHardman) March 2, 2016
Still, focus on childcare/education an attempt to show that Labour still holding government to account despite splits
— Isabel Hardman (@IsabelHardman) March 2, 2016
From the Independent’s Nigel Morris
Cameron had to bend over backwards to get the "Acropolis Now" joke in. Not sure it was worth it. #PMQs
— Nigel Morris (@NigelpMorris) March 2, 2016
From Huffington Post’s Owen Bennett
Cameron's 'Acropolis Now' joke falls flat as he crow-bars in a dig at Corbyn hiring @yanisvaroufakis as an advisor #pmqs
— Owen Bennett (@owenjbennett) March 2, 2016
Corbyn's questions are too long, too full of stats, too many sub-clauses #pmqs
— Owen Bennett (@owenjbennett) March 2, 2016
From BuzzFeed’s Stuart Millar
British politics 101
— Stuart Millar (@stuartmillar159) March 2, 2016
Corbyn: have you broken promises on childcare?
Cameron: Terrible Acropolis Now pun about Varoufakis #PMQs
From LabourList’s Conor Pope
Corbyn's first question on tax free childcare ("What's the hold up?") might be the shortest he's ever asked at #PMQs
— Conor Pope (@Conorpope) March 2, 2016
From Sky’s Faisal Islam
I can't recall a single Corbyn PMQs question since he started about Europe...
— Faisal Islam (@faisalislam) March 2, 2016
From Political Betting’s Mike Smithson
PMQs no longer a must watch. It's just boring and tedious.
— Mike Smithson (@MSmithsonPB) March 2, 2016
From LBC’s Iain Dale
I caught PMQs today for the first time in months. I'm now left wondering why I bothered. Borefest.
— Iain Dale (@IainDale) March 2, 2016
Here's the NAO report Cameron and Corbyn have been quoting from: https://t.co/1539XaURMi #PMQs
— Full Fact (@FullFact) March 2, 2016
PMQs - Verdict
PMQs - Verdict: Jeremy Corbyn is not interested in jokes, insults or histrionics and his best moments at PMQs have come when he has asked straight, serious questions about mainstream topics where the government’s record is patchy.
This is what he did today, on childcare:
Could the prime minister tell us why his promise of 30 hours’ free childcare is not there for one in three working parents who want their children to be cared for in a preschool?
And on schools:
Will the government accept that there is a crisis of recruitment and of retention in this crucial profession?
These are both important issues and Corbyn was somewhat effective at highlighting government delivery weaknesses in both areas.
But only somewhat - because what Corbyn does not do is press home his attack to the point where it carries some presentational hurt, and, by asking questions in a relatively low-key and broad-brush manner, he enables Cameron to respond with a fairly sweeping defence of what the government is doing. In truth, governments are never 100% good or 100% bad at anything, and Cameron’s answers today - as they do so often - amounted to generalised PR about how the glass is half-full. A neutral observer (if there is such a person?) will have concluded that his record on childcare and schools has not been entirely great, but not entirely bad either.
The most interesting line, I thought, was Corbyn’s comment about “agency Britain”. It is often said that Corbyn has not changed his views at all since he was a teenager. In Rosa Prince’s useful and readable biography, Comrade Corbyn, she describes the campaign he ran when he first stood for parliament in 1983. Prince could have been writing about Corbyn in 2016.
[Corbyn’s] campaign literature declared: ‘Under the Tories, Britain has become an even more divided and unequal society.’ He condemned the ‘cuts, closures and poverty’ of the Conservative government, issued a clarion calls for the end of nuclear weapons, and demanded an extensive programme of house building.
But talking about “agency Britain” is a way of recognising that the world has moved on since the 1980s. It highlights the way public services are increasingly contracted out, but also makes a point about labour market insecurity (the same point Hillary Clinton made in a much-talked-about speech on the “gig economy” last year). There is a big political agenda to be developed here. Cameron did not pick up on Corbyn’s point at all, and it remains to be seen whether Corbyn will follow it up himself.
Updated
Helen Whately, a Conservative, asks what the government is doing to respond to the campaign for a meningitis vaccination programme.
Cameron says the programme targets children at highest risk. But we need to look at the case for extending it, he says.
Labour’s Barry Sheerman asks Cameron if he ever seeks inspiration from Harold Wilson, who stood up to the rebels in his party over Europe. The centenary of his birth is next week, he says.
Cameron says he has sympathy for anyone who did this job. And Wilson achieved important things, he says.
Phillip Lee, a Conservative, asks about the Syrian refugees in Jordan.
Cameron says Britain can be proud of what it has done in terms of supplying aid.
Labour’s Liz Kendall says the situtation in Syria is dire. What is the government doing to make sure the ceasefire is being monitored?
Cameron says the ceasefire is a step forward. Britain is working with the Americans and Russians to make that happen. He is speaking to President Putin later this year to reinforce that point, he says. He says he would not “put too much optimism into the mix”. But the ceasefire is progress, he says.
Labour’s Ian Austin says British medals are being made in France. He says there is a great medal factory in the Midlands which makes the best medals in the world. Will Cameron change this?
Cameron says he was not aware of this, but he will look at this. When we can make something in Britain, we should, he says.
Stuart Andrew, a Conservative, asks about the recent ruling on joint enterprise.
Cameron says he will hold a meeting about this.
Gisela Stuart, the Labour MP, says Richard Gere came to parliament yesterday to campaign on behalf of Tibet. Will Cameron write to the Chinese about the oppressive anti-terrorism laws being implemented in Tibet.
Cameron says he will look into this and write to Stuart.
Updated
Bill Wiggin, a Conservative, asks about the rural payments agency.
Cameron says the system is complicated. To date, 81% of farmers have received their 2015 payments. But there is always scope for improvement.
Labour’s Rachael Maskell asks why homes are being built in York in a development without a single home for social rent.
Cameron says that is a matter for York council. But the government changed the rules to allow offices to be turned into flats. That is happening in York, he says.
Richard Benyon, a Conservative, asks about fishing. Does Cameron agree that the fishing industry is better off in a reformed EU.
Cameron agrees. The key thing is to ensure that Europe’s markets remain open to British farmers, he says.
Labour’s Andy McDonald asks Cameron to develop a meaningful industrial and energy strategy.
Cameron says he will look into this. He backs all energy projects that create jobs. He knows McDonald was disappointed by the carbon capture and storage decision. But there were problems with the proposal.
PMQs - Snap verdict
PMQs - Snap verdict: Corbyn is clearly onto something with his talk of “agency Britain”, and by and large he successfully prodded Cameron on the issues of childcare and schools in a way that exposed government delivery weaknesses, but it was a performance that was competent rather than exciting, and Cameron was left sounding awkward, but never seriously embarrassed. As for the detail, the factcheckers will have a bonanza, because this was a PMQs unusual rich in statistics. Cameron sidestepped the most tricky complaints about his record, but he was well-armed with positive detail with which he could retaliate. The serious tone will appeal to those who hated last week’s abuse, but Cameron couldn’t resist one snappy but largely irrelevant joke.
Updated
Corbyn says class sizes are growing. And there is a teacher shortages. He asks a question from Tom, head of technology at a secondary school. Will the government accept there is a crisis of recruitment?
Cameron says there are 13,000 more teachers than when he became prime minister. And if Labour wants more teachers, how will putting up tax, as they are in Scotland, help.
Corbyn says Cameron is in a bit of denial. Ofsted and the NAO both say there is a teacher shortage. Some 70% of teachers says they need to use agency staff. More than £1bn is spent on agency teachers. Aren’t we moving into an era we could call “agency Britain”.
Cameron says teachers are more qualified than ever. Going into teaching is popular. Teach First is a successful programme. You need to have rigour and discipline in schools. But a strong economy is vital too, he says.
Corbyn says an NAO report says one third of parents offered free childcare won’t get it. It is a broken promise, he says.
Cameron says the NAO says the department has successfully implemented this with almost universal take-up. He quotes from it saying parents have benefited. The government has been able to act because it has a strong economy. He says Labour is now getting advice from the Greek finance minister who left the economy in ruins. That is Labour’s polic in two words: Acropolis Now.
Corbyn says that is not much help to families. Half a million children in primary schools are in classes over over 31. Some are in classes of over 40. Some are living in poverty. Let’s have a serious government intervention.
Cameron says since the NAO report saying only 58% of disadvantaged two-year-olds were getting free childcare, the latest figure is now over 70%. On school place there there are fewer schools that are over-capacity, he says. He says he has protected education funding. And he introduced the pupil premium. There are more places and fewer overcrowded schools.
Jeremy Corbyn says the government announced a policy of tax-free childcare three years ago. What has been the hold up?
Cameron says the government is introducing this, plus 30 hours of free childcare. It is coming in this year.
Corbyn says it is described on the Treasury website as a longterm plan. Why is it not there yet?
Cameron says tax-free childcare will come in in 2017, partly because the government lost a court case. And free childcare is being introduced. He says he is grateful for the chance to publicise these measures.
Seema Kennedy, a Conservative, asks about apprenticeship.
Cameron says the government will fund its 3m apprenticeship programmes. Business will do its bit too. But small business should help as well.
The SNP’s Patricia Gibson asks if David Cameron intended to take £7bn from Scotland over a decade through the fiscal framework. And why?
Cameron says only the SNP would try and maintain a grievance after settlement has been put in place. They should get on with government, he says.
Corbyn arrives for PMQs, defiantly ignoring Ma Cameron's fashion advice by wearing his granola jacket
— Patrick Kidd (@patrick_kidd) March 2, 2016
Nick Boles, the employment minister, has put out a statement responding to the Lords select committee report on the trade union bill. (See 10.51am.) He said:
The committee has accepted the principle that members should be asked to make an active choice about whether to opt-in to a union’s political fund.
There might be differences of opinion about how and when this should be implemented, but the principle underlying the government’s manifesto commitment that union members should make an active and transparent choice to contribute to political funds has been supported by the committee.
Cameron at PMQs
Here is the running order for PMQs.
Order paper for #pmqs 9 remainers, 4 undecideds, 2 Leavers, including @bernardjenkin - @skynews panel coming up pic.twitter.com/9Vl2lruKbX
— Faisal Islam (@faisalislam) March 2, 2016
Russia is the only world power that would welcome a British exit from the EU, Philip Hammond has said as the government intensified its warnings about the danger of a vote to leave.
The foreign secretary dismissed calls by leave campaigners to create a new trading relationship with the Commonwealth Anglosphere by saying that all of Britain’s allies want the UK to remain in the EU. He called on Leave campaigners to reflect on Moscow’s support for a break up of the EU.
In a speech at Chatham House, where he launched a new government report which rejected all the alternatives to EU membership, the foreign secretary said:
Some have said we should focus our attention on the Anglosphere and the Commonwealth. But the EU already has or is negotiating trade deals with all the biggest commonwealth countries. None of our allies wants us to leave the EU - not Australia, not New Zealand, not Canada, not the US. In fact the only country, if the truth is told, that would like us to leave the EU is Russia. That should probably tell us all we need to know.
Hammond spoke after he warned that alternatives to UK membership of the EU come with a “price tag”, and he accused anti-EU campaigners of failing to explain how Britain could prosper outside the union.
The Electoral Reform Society has welcomed today’s Lords select committee report on the trade union bill. (See 10.51am.) This is from Katie Ghose, its chief executive.
This report gives the government a clear opportunity to start urgently needed talks on reforming party funding. The public are sick to death of scandals involving big donors, and want to see real reform of the way parties are financed. But as this committee has explicitly recognised, changing the way one party is funded without looking at the wider picture is not the route to a sustainable settlement.
We strongly welcome the committee’s recommendations on reforming the proposed opt-in process for new trade union members. In particular, a minimum 12-month period for unions to move to the new arrangement gives parties a window of opportunity to get round the table and sort out their funding issues once and for all.
We also welcome the committee’s recommendation to exclude existing union members from the new opt-in arrangement until cross-party talks on party funding reform have been established. It isn’t right that one party which happens to be in government should be able to move unilaterally against its opponents’ source of funds. The committee has rightly pointed out that this could start a tit-for-tat funding war that would only serve to damage our representative democracy and further undermine public faith in political parties.
Vote Leave says people on the Leave side are not backing the Norway, Switzerland, Canada or WTO options as alternatives to EU membership. But at the weekend Britain Stronger in Europe published its own 42-page dossier showing the Leave campaigner have endorsed these options, and many others.
Vote Leave says Leave campaigners not backing Norway, Switzerland, Canada or WTO options
Vote Leave has put out a briefing paper responding to the government’s latest claims about the alternatives to EU membership (which are in a document we have not seen yet, but which are nevertheless summarised at 11.28am.)
It claims Leave campaigners “have made clear that they are not advocating the Norway, Switzerland, Canada or WTO options”.
It says, even though the government claims Norway and Switzerland are worse off outside the EU, those countries do not want to join. Only 19% of Norwegians and 6% of Swiss voters are in favour of joining, it says.
It says the government is wrong to claim that Norway has to accept 75% of EU laws. Estimates vary between 10% and 25%, it says.
And it claims that, as a member of the European Economic Area (EEA), Norway does have a veto over EU laws.
Lord Tyler, the Lib Dem constitutional affairs spokesman, has welcomed today’s Lords report from the select committee on party funding. (See 10.51am.) He said in a statement:
The public are rightly suspicious that money appears to buy preferential access, influence and even personal promotion in British politics.
It is high time the political establishment moved away from a system in which they are constantly chasing donations from powerful organisations and millionaires.
This report, and its recommendations, offer the best hope of progress on fair reform of party funding in this Parliament. We must reform the system to give the public what they want - a system that represents them.
Government highlights disadvantages to four alternatives to EU membership
The government has not yet published its document about the alternatives to EU membership (and their disadvantages). But Number 10 has sent out a briefing note summarising the problems with four of the most obvious alternative options.
For the record, this is what it says.
Norway:
- Contributes significantly to EU spending
- Accepts free movement of people. More than 6 percent of the population resident in Norway are EU nationals - a higher proportion that in the UK (4%).
- Accepts 75% of EU laws but with no votes or vetoes over these rules
- Pays tariffs to export agricultural products and fish to the EU
Switzerland:
- Pays into the EU
- Accepts EU free movement of people
- Limited access for services firms – services account for 80% of the UK economy
- UK financial services firms could face increased costs as they would no longer have ‘passports’ allowing them to sell to the EU market without needing extra permits
- No say or votes over EU laws
- Switzerland’s agreements with the EU have taken two decades to negotiate
Canada:
- The EU-Canada Agreement began over seven years ago with a scoping exercise and is still not implemented
- Only partial access to the EU single market, including for financial services
- Products with too many foreign components face tariffs, and quotas remain in place for key agricultural exports, such as beef.
- Car manufacturers must comply with the EU’s “Rules of Origin”, meaning increased bureaucratic costs
- No say or votes over EU rules but firms that export to the EU still have to comply with them
World Trade Organisation:
- What we would have to fall back on if we failed to reach a deal with the EU
- New tariffs on UK exports to the EU, making UK exports far more expensive.
- Tariffs include 5% on chemical exports, 10% on cars, 20% on alcohol like Scotch Whisky and up to 50% on some foodstuffs
- A huge number of companies whose supply chain is in Europe would suffer thanks to increased tariffs and bureaucratic burdens. Increased tariffs could be passed on to consumers.
Lords committee proposes watering down government's anti-Labour trade union funding bill
The government’s trade union bill, which could cut Labour party funding by up to £8m a year by requiring union members to opt in to contributing to political funds instead of just giving them the right to opt out, is still going through the House of Lords. But today a report has come out that significantly increases the chances of the government being forced to make a major concession to Labour.
In an unusual move, peers agreed in January to set up a select committee to look at the clauses of the bill dealing with party funding. Opposition peers argued that this was appropriate because there is a tradition of only changing party funding rules by consensus. The committee took evidence from a wide range of witnesses, and today it has published a report (pdf) making recommendations.
There are two key points.
- A majority of the peers on the committee are calling for the proposed opt-in rule to apply just to new trade union members. The rule should only then be extended to existing members as part of an overall party funding reform affecting all parties, they say.
- The committee as a whole says the government should convene cross-party talks on party funding reform.
Peers will debate the report next week and when the bill starts its report stage, on Wednesday 16 March, it is almost certain that an amendment will be tabled saying the opt-in arrangements should only apply to new members joining trade unions, not existing members. Labour and the Lib Dems would support as an improvement to the bill and, given the fact that most members of the committee are the backing, it would be surprising if the Lords as a whole did not back it by a wide margin.
The government would then have the option of overturning the vote in the Commons. But Labour sources believe that it is now at least possible that, with the Lords taking a robust stance, the government could eventually be forced into backing this compromise.
(There is also an argument that, if David Cameron wants Labour to campaign hard for Britain to stay in the EU, he might be best advised toning down a bill that would render the party near bankrupt.)
A trade union bill that only applied an opt-in rule for political donations to new trade union members would still be a threat to Labour funding. But the threat would be far less drastic than under the current proposals.
Commenting on today’s report, Lady Smith, the Labour leader in the Lords, said:
The report confirms that reversing the current ‘opt-out’ process to ‘opt-in’ would have a huge and significant impact on Labour’s finances. All members of the cross-party committee agree that it would take at least 12 months to implement such proposals, and the majority consider it should only apply to new members.
With nothing being done to address big donations to the Conservative Party, I hope the report paves the way for a fair, reasonable and lasting agreement on party funding – in stark contrast to David Cameron’s partisan attack on Labour and the trade unions, and by extension democracy itself.
Leave.EU has said that it’s no surprise that BlackRock is opposed to Britain leaving the EU. (See 9.11am.) It’s a “selfish actor ... looking out for its own vested interests”, according to Leave.EU’s spokesman Jack Montgomery. In a statement he said:
Anyone who looks into BlackRock’s history will see their support for EU membership as a very good reason to support the Leave campaign.
It’s a crony corporation which bought more access to the European Commission than any other firm in 2015, after increasing its lobby spending ten-fold. It’s employed by the European Central Bank to advise it on purchasing asset-backed securities – a hilarious conflict of interest, given its status as the world’s biggest asset manager.
Most damning of all, it was BlackRock which acted as the Troika consultancy of choice during the financial crisis, stress testing the banks in Ireland, Cyprus and Greece, getting its numbers embarrassingly wrong but pocketing tens of millions of euros regardless.
Like the disgraced American investment banks bankrolling the Remain campaign, BlackRock is a selfish actor in this referendum, looking out for its own vested interests, not the public interest. Fortunately, it’s the public who have the final say in June, not them.
Philip Hammond, the foreign secretary, has been giving interviews this morning about the government’s dossier about the alternatives to membership of the EU. On LBC he was asked about the Mail on Sunday splash about how (as the paper put it) “hurled foul-mouthed abuse” at the Conservative MP Sir Bill Cash after Cash, a select committee chair, published a document against Hammond’s wishes. Hammond explained:
I expected him to respect that confidence and he didn’t do so and I’m very disappointed that he didn’t.
But he played down the significance of the row.
Bill Cash and I have known each other for many years and we disagree fundamentally on this issue before us [the EU] ... But I have always thought of Bill Cash as an honourable person.
Whether you call it Project Fear or Project Fact, the campaign being run by Downing Street and Britain Stronger in Europe over the last 10 days or so to highlight the disadvantages of leaving the EU has been thorough, well-argued and relentless.
But has it been persuasive? Not necessarily, according to the recent polling, although at least the In camp has a clear and consistent message. As Alastair Meeks argues at Political Betting, the Out camp’s messaging has been all over the place.
This morning we’re getting another instalment of Project Fear/Fact - a new government dossier, highlighting the disadvantages to the alternatives to EU membership. Prices could go up, the government is saying.
Here are the key points overnight.
- Philip Hammond, the foreign secretary, has claimed that prices would go up if Britain left the EU. He made the claim on the basis that, if Britain left, it would lose more than 50 trade deals. He was speaking ahead of the publication of a report that will look at alternatives to EU membership - such as a Norway-style relationship with the EU, a Switzerland one, a Canada one, or one simply based on World Trade Organisation rules - and that will argue that they are all flawed. Hammond said:
Hard-headed analysis shows that every alternative to remaining in a reformed EU would leave Britain weaker, less safe and worse off. Working people would pay the price with fewer jobs and rising prices.
- Iain Duncan Smith, the work and pensions secretary who is campaigning for Brexit, has dismissed the document as a “dodgy dossier”. He said:
As each day passes we see yet another example - from the utter failure to cope with the migrant crisis, to the increasing disaster of the euro.
This dodgy dossier won’t fool anyone, and is proof that Remain are in denial about the risks of remaining in a crisis ridden EU.
The truth is we won’t copy any other country’s deal. We will have a settlement on our own terms - and one that will return control of our borders, and money to Britain. That’s the safer choice.
Dominic Raab, the justice minister who is also campaigning for Brexit, criticised the document when he gave an interview to the Today programme, but he refused to endorse Duncan Smith’s “dodgy dossier” term. Instead he accused the government of scaremongering.
I think that there has been far too much scaremongering. It’s like Halloween come early; we have a scare story each week about the ghoulish prospects outside the European Union. I don’t believe in ghosts and I’m not afraid of these ghoulish stories of life outside the EU. Iain will choose his own words and I’ll choose mine.
- Raab has said that Britain might face “slightly higher tariffs” when trading with the EU if it left. Speaking on the Today programme about what kind of trade relationship Britain might negotiate with the EU, he said:
I think we want to go into the negotiation offering a very ambitious trade deal, but you’re right to say that there are areas like agriculture and services where we might get slightly higher tariffs. But, of course, those are areas that are protectionist within the single market.
- BlackRock, the world’s largest asset management company, has issued a report saying Britain would be worse off if it left the EU. Summarising its conclusions, it said:
Our bottom line is that a Brexit offers a lot of risk with little obvious reward. We see an EU exit leading to lower UK growth and investment, and potentially higher unemployment and inflation. Any offsetting benefits look more amorphous and less certain, in our view.
One of the authors of the report is Rupert Harrison, who was George Osborne’s chief of staff until the 2015 election and who is now BlackRock’s chief macro strategist (whatever that means).
- Lord Lamont, the Conservative former chancellor, has backed the campaign to take Britain out of the EU, using an article in the Daily Telegraph to criticise the In camp for scaremongering. He wrote:
Project Fear’ has become ‘Project Horror Comic’. People may have been concerned when they saw the G20 communique suggesting that a Brexit could lead to a world economic ‘shock’.
Of course, if people are determined to talk themselves into a crisis they will - it should be remembered that the G20 members include not just four members of the EU but also the EU itself.
Yet if there is to be an effect on confidence, it will be short-term. Frankly, after the long drawn out eurozone crisis, it is a bit rich for the EU to talk about ‘shocks’ to the world economy.
- A survey of 1,000 Conservative party members for the Times suggests that Boris Johnson’s decision to back Brexit has made him the clear favourite to succeed David Cameron as party leader. As Matt Chorley writes in the Times’ Red Box morning email:
The mayor of London was the choice of 43 per cent of the 1,005 party members surveyed by YouGov for The Times.
This put him 21 points ahead of the chancellor on 22 per cent of the vote. Theresa May, the home secretary, was third on 19 per cent; Sajid Javid, the business secretary, was on 7 per cent and Nicky Morgan, the education secretary, was backed by only 1 per cent of members.
In a final run-off between Boris and George, Boris wins by win 56 per cent to 38.
There is bound to be more Europe today. And here is the full agenda for the day.
9.30am: Sir Michael Whilshaw, the Ofsted chief inspector, gives evidence to the Commons education committee.
9.50am: John Whittingdale, the culture secretary, speaks at the Oxford Media Convention.
10.30am: Philip Hammond, the foreign secretary, gives a speech on Europe.
12pm: David Cameron faces Jeremy Corbyn at PMQs.
2.30pm: Joseph Stiglitz, the Nobel Prize-winning economist and a member of Labour’s economic advisory committee, gives a lecture on “Rewriting the rules of the market economy to achieve shared prosperity” as part of a series organised by Labour to promote alternative economic ideas. Afterwards he will hold a Q&A with John McDonnell, the shadow chancellor.
As usual, I will be also covering the breaking political news as it happens, as well as bringing you the best reaction, comment and analysis from the web. I will post a summary after PMQs and another in the afternoon.
If you want to follow me or contact me on Twitter, I’m on @AndrewSparrow.
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