A collaborative blog for Current Affairs and Policy Debate

A Change of Programme

In Constitutional Spotlight, Events, Home Affairs, Parliamentary Spotlight, Party politics on July 9, 2012 at 7:22 pm

By polarii for The Daily Soapbox – @polar_ii

Today the government faces the threat of defeat on a high-profile piece of legislation: Lords Reform. Specifically, the government are looking vulnerable on one particular programme motion. Ed Miliband says he supports the principle of Lords reform, but that the government should not limit discussion on the bill to 23 days, which is what the programme motion would do. Mark Ferguson at Labour List, in this article, correctly to my mind, reads this not as an opportunity to beat the government at the somewhat tedious game of Commons divisions, but to stick to principles. He exhorts Miliband to reverse his decision, stick to his principles and vote for the programme motion.

Now, the issue is only salient because 100 or so Conservative MPs are threatening to break their party whip on the programme motion. This means that the government might well lose the vote on the programme motion; and the last time a Lords Reform Bill had its accompanying programme motion defeated, the whole Bill had to be scrapped entirely. Hence Ferguson’s exhortation to vote for the programme motion – while Miliband can inflict a momentary defeat on the Coalition have a tremendous laugh about it, such an action would risk undermining Labour’s commitment to an elected Lords. Ferguson thus invokes the supremacy of principle over short-term political gain to advocate a change of course.

However, this is to ignore the arguments against the programme motion. They centre around the fact that the Lords Reform Bill is a constitutional motion; moreover, it is a constitutional motion of some importance. Previously, bills that made significant changes to the constitution have not been time limited, to allow full discussion on the floor of the Commons, rather than limiting it to a bill committee with a limited timeframe.

This is particularly important considering the range of issues that haven’t been fully discussed. Are there sufficient safeguards for the primacy of the Commons? Ought there to be a referendum on such a substantial change, as Labour have argued? Will the new composition of the Lords secure the same representation for minority groups as the current composition (see, e.g. this piece on ConHome that argues that disabled people will be less well represented)? If new Senators are elected to 15-year non-renewable terms, how does the electorate hold them to account?

These are clearly not specious questions, though they may be deployed speciously against the programme motion. The 100 or so Tory rebels are 100 or so Tories who do not want to see the Lords become elected. Miliband is undoubtedly leading his 250 odd Labour MPs against the programme motion to allow these 100 or so Tories to spend hours upon hours arguing against their government on every conceivable point, creating an impression of disunity in the Coalition and frustrating the remainder of its legislative programme. These 100 or so Tory rebels would dearly like to make life hard for Nick Clegg, who, by abstaining on a confidence motion, made life hard for Jeremy Hunt.

So what really niggles me is that these procedural arguments – though they may be tedious, they are exceptionally important – are taking second fiddle to the realpolitik of the situation. It’s easy to see why. But we simply assume that there are 100 Tory MPs voting against the government solely to spite the Lib Dems, that Labour MPs are voting against the motion simply to spite the Coalition, and no-one is actually thinking about the content of the programme motion itself. There are definitely MPs on both sides who want this bill to pass with proper scrutiny, and they arrived at this conclusion without the influence of realpolitik. It’s doing a disservice to our MPs to assume that all they are interested in is getting one up on one another; Miliband may actually have an embarrassment of good reasons to be opposed to the programme motion while supporting the second reading of the Bill.

David Cameron used the argument in the Commons today that we have talking about Lords Reform for 100 years, so now’s not the time to have yet more debate. We have also been debating the disestablishment of the Church of England, a European Community of Nations, the Monarchy, Ulster, Scotland and many other important constitutional questions for 100 years. That the issues have proved complex and intricate, contentious and important for a substantial period of time is no argument for curtailing debate on the questions: if anything it demonstrates that more and more careful thought is required. Especially when a government committee as promised in the Coalition agreement could not find anything approaching a consensus, and the current bill has been shot down by a Join Committee of both houses.

The instinct – to shut down the issue within 23 days and move on – betrays a government that is eager to get many things done, but also one that does not welcome the scrutiny that should be brought to such an important question. I would speculate that this is because, in our age of 24-hour news, politicians have lost the knack of carefully considering and reworking proposals; after all, if there was a news vacuum, a small change in an important bill might look like weakness.

I happen to be against this particular Bill for reforming the House of Lords. Perhaps that’s why I have time for the procedural points on the programme motion. But I would like to think, if there was a major constitutional change I did support, I would at least have the time to appreciate the importance of the matter and the patience to listen and take on board objections, and not guillotine debate. Debate on the Lords Reform Bill should not be guillotined; constitutional matters are too important to be rushed. That, Mark Ferguson, is a point of principle also.

Boris and the BBC

In Home Affairs, The Media on May 14, 2012 at 8:19 pm

By polarii for The Daily Soapbox –@polar_ii

Boris Johnson, now that he has safely returned to the Mayoralty, launched a devastating attack this morning on the BBC. Read it here. “It’s statist, defeatist, leftist,” splutters Johnson from the top of that red Curly Wurly in London, the ArcelorMittalOrbit (see picture).

Boris was more impressed with a giant red Curly Wurly than the BBC

Boris goes so far to suggest that a free-market loving, Eurosceptic Tory be given the reins. Well, aside from the fact that the BBC is already run by a Tory, Chris Patten, this won’t actually change anything. The BBC has a culture produced by its secure bastion of public funding, its privileged position in the media market and the sort of people that work for it.

You see, the BBC is run from the public purse by way of the license fee. The £145 or so everyone who has a TV pays to watch a TV. The BBC therefore has a guaranteed source of income. It also has editorial independence, so it can be as bold as it likes when it produces programmes. Where Boris sees impracticalities in the BBC Arts Editor’s response that the Curly Wurly ought to be ‘taller’ and ‘free’, the BBC clings to this noble ideal that tall things can really be both tall and free at the same time; that programmes can be state of the art and hard hitting while being ‘free’ for the taxpayer.

But of course, the BBC isn’t free. We all know that. We’ve even said that already. It costs everyone £145 per year to fund the BBC. That funding is ring-fenced. It’s a reassuringly large and certain stream of income, one that other competitors in the media market don’t have. Where everyone else has to rely on advertising revenue, which is awarded in proportion to viewing figures, the BBC can afford to produce niche programmes like See Hear that would never be viable in the big wide world of the market.

And don’t get me wrong, it’s really good that we have a public service broadcaster that produces programmes like See Hear. Programmes which inform and challenge and provide a genuine public service. But much of what the BBC does not provide a public service that the market does not already provide. Whilst I’m sure fans of both series will disagree vehemently, Eastenders and Coronation Street are pretty much the same thing. Sky News does pretty much what BBC News 24 does. Heart and BBC Radio 1 are pretty much indistinguishable.

This creates a problem. The stability of the BBC in the market makes it difficult for non-BBC competitors to break into the market. Take current affairs radio. BBC Radio 4 and Radio 5 Live have pretty much cornered that market. Iain Dale makes a valiant effort on LBC. But that doesn’t serve outside London. The status of programmes like Question Time (BBC 1), the Andrew Marr show (BBC 1) and Newsnight (BBC 2) (not to mention the Daily Politics, This Week &c) mean that anyone with any serious interest in public affairs is glued to various BBC outlets for much of their waking life. Tim Montgomerie has done more research than I can comfortably conceive to show that the BBC enjoys an effective monopoly on Radio, TV and online coverage. Put aside the argument that the BBC exhibits biases for one moment. If this sort of monopoly was held by a private sector news agency, even one that had neutrality written into its memoranda and articles, regulators would be profoundly unhappy with it.

Now, I don’t particularly want to wade into the debate about BBC bias. I think Boris is quite close to the truth when he says that the BBC’s public funding creates a culture which favours left-liberal ideas. Andrew Marr has further noted that, since the BBC hires a disproportionate number of LGBT people, people from ethnic minority backgrounds and young people, the ethos of the BBC will be unconsciously skewed towards left-liberal views. Jeff Randall, its former business editor has made similar remarks. As has Antony Jay (£), writer of Yes Minister. As has Rod Liddle, former editor of Radio 4’s Today Programme. As has Peter Sissons, former news anchor. People criticise the BBC for being too right-wing, such as MediaLens, though these voices are much quieter and by far in the minority. But the flow of criticism that the BBC is biased against centre-right views is sustained enough and vocal enough to have undermined trust in the Corporation.

But Boris’ solution is wrong. The solution is not to appoint a Tory. Firstly, because that’s already been attempted several times, and hasn’t got very far, but, more importantly, because it overtly politicises an institution that is, at worst, only subconsciously politicised, and ought to be neutral.

So here are three solutions. The first is to make the BBC subject to media regulators and competition law. The thought behind this is that the effective monopolies the BBC has on radio particularly, but to a lesser extent TV and online, are squeezing out other players in the market. The more players there are in this market, the broader the range of views and sources available; the more people will be able to vary their viewing. In a well-functioning market, competition also acts as a spur for all competitors to do better, improving the overall quality of, in this case, broadcasting.

Second, offer programmes which are a public service, but too niche to survive in the market, such as perhaps ‘See Hear’ or ‘From Our Own Correspondent’ to the wider market. If the BBC can make a programme for deaf people, so can Sky or C4. They might even be better at it. Contracts could be tendered for a year and sold to the broadcaster with the best proposals for using a designated funding grant from government. The government should also ensure that they go out on terrestrial channels (or when the digital switchover is complete, Freeview channels), since the public service element shouldn’t require additional payment above and beyond existing taxes.

Which leads me on to my third, most radical idea. Abolish the license fee and find the money by a rise in income tax. Why should we do this? Firstly, it is an effective tax cut of £145 for anyone who doesn’t earn enough to pay income tax; the very poorest in our society. Secondly, it removes the injustice of what is essentially a poll tax, paid with no regard to people’s income. Thirdly, some people make perfectly valid complaints about how they’re paying the license fee to watch ITV or C4 and never watch the BBC, yet still have to pay to fund the BBC. Why should access to ITV and C4 be contingent on paying for the BBC? Access to the BBC is certainly not contingent on paying for ITV. Either the license fee should be distributed around all the terrestrial channels, or there should be no license fee.

One other advantage of moving the BBC from the license fee to general taxation is that it will appear on the government’s wonderful new tax returns, which show where the tax is going and in what proportion. The BBC had a budget of £3bn last year. It’s trivial compared to welfare at just shy of £200bn. But allowing people to see how much the BBC costs them relative to say, healthcare or education might make them question if they really value it. It might make the people who want to see the BBC fully privatised decide that it’s really not that much money to pay for no adverts on TV, Radio and Online, with generally good content. It might even make the BBC staff realise that big and brilliant things can’t really be had for free.

So there’s the manifesto for the BBC. Competition and regulation, individual public service broadcast contracts and the abolition of the license fee. The BBC still has its funding and the independence to make brilliant programmes (above and beyond the programmes the government directly commissions). But this way, it’s fairer, clearer, and allows for much greater media plurality. Even Boris can’t be against that.

Less Tax, Less Spend

In Economy, Home Affairs on March 21, 2012 at 9:55 am

By polarii for The Daily Soapbox –@polar_ii

Today is Budget Day. All Westminster is on tenterhooks, looking forward to a relatively dry state from George Osborne about the state of the nation’s finances and his plans for the next few years. Anyone who’s been vaguely following the political news, whether in newspapers, in blogs or on TV will know the key issues in this Budget. Should Osborne cut the 50% upper rate of income tax (more specifically, can Osborne survive the political backlash by pointing to more revenues)? Should we introduce a new sort of wealth tax, either directly on wealth or on property? Should the income tax threshold be raised, and by how much?

I’m going to leave most of the economic arguments to one side and look at three political shifts since the last Budget.

1) The Liberal Democrats no longer have much influence at the Treasury

This year, the Liberal Democrats decided to make their positions on the Budget public. Essentially, they conducted Budget negotiations in full view. This has turned out to be a poor move. By tabling proposals for a mansion tax before anyone else had proposed anything, they had plenty of time to be savaged. The wisdom was once that the Lib Dems would not permit Osborne to remove the 50% tax rate without a huge concession like a mansion tax. Now, all it looks like Osborne will do is promise to close some tax loopholes on first homes (something he has promised to do before). Although Nick Clegg and Danny Alexander make up half the ‘Quad’ that negotiates the Budget, they have been comprehensively out-manoeuvred by Osborne and Cameron. The Conservatives are much closer to owning the idea of income tax threshold rises. They’ve avoided a mansion or property tax. The ‘Green Agenda’ has almost vanished from view. Unless Osborne surprises us today, there will be very little the Lib Dems can claim as their handiwork in the Budget.

2) VAT is off the table

Remember the heady days of 2010? The UK had its first Coalition government, Clegg and Cameron were making happy love in Downing Street’s Rose Garden, and George Osborne presented his emergency budget. In it, of course, he raised VAT to 20%, much to the consternation of the Labour party. Labour still want to reverse it, but only temporarily (at least, this is what they’re five-point plan says). Given that VAT is a regressive tax (the poor pay a greater share of their income in VAT than the rich) and it’s a tax on consumption (i.e. buying things), you would have thought that there would be widespread consensus against it becoming higher with a stagnant economy. However, someone has clearly won the argument for it – whether it’s the extra revenue it brings in for comparatively little impact on people’s pockets or the need to rebalance the economy away from consumption and towards production – and now Labour backs, in the long term, the 20% rate. It’s a U-turn they have managed with considerable deftness. But no-one is seriously suggesting cuts in VAT. Osborne’s won the major tax policy battle of the 2010 Budget with comparative ease. Perhaps this has emboldened him with the 50% tax rate?

3) No-one wants to talk about the cuts

As we know, this government is cutting. There are arguments about whether it is cutting too much or not enough, too fast or not fast enough, whether its cutting in the wrong place etc. George Osborne enjoyed a surplus of about £5bn since his last budget, meaning he has cash to throw around. And everyone seems to want him to throw it at tax cuts of one sort or another. Admittedly, in the grand scheme of things, £5bn is not a huge amount of money. It’s 1% of government expenditure, worth about somewhere between a half and a third of the international aid budget or maybe 1 in every 40 pounds spent on welfare. But there are certainly things Osborne could do with it. He could reverse the planned 20% cut to the non-means-tested disability benefit DLA (a cut which, incidentally, there is absolutely no evidence to suggest is desirable or sustainable) – this is planned to save just under £2.2bn. Admittedly, Osborne cannot do much with regard to reversing his cuts. But he could use the option to do something totemic but relatively inexpensive. Such as preserving the DLA budget as benefits for disabled people are reformed. But again, no-one is making the case for public spending cuts to be reversed over tax cuts. Maybe this is because people enjoy the idea of a tax cut more than they enjoy the idea of disabled people having enough money to live on, but this is perhaps too cynical a view. More likely is that everyone sees Osborne’s mandate is now so closely tied to the cuts set out in 2010’s Comprehensive Spending Review that going back on one element, no matter how good the arguments for going back, will fatally undermine his credibility.

What we can see then is this: Osborne’s Budget 2010 has shaped today’s political landscape. The direction he took in that Budget meant that any discussion about any other Budget before the 2015 election would be about tax and not spending. The Conservatives, as a low-tax party, will always enjoy the advantage over Labour and the Liberal Democrats when it comes to cutting taxes; just as Labour, a high-spend party, will always have the advantage when talking about spending. Perhaps this is why Miliband and Balls feel so out-of-place this year, with the Shadow Treasury Team reportedly having no comeback to Osborne despite practically knowing  his Budget in advance: Osborne has simply moved the debate onto territory with which they are completely unfamiliar and profoundly uncomfortable, and they cannot wrest the narrative away from tax cuts to spending cuts. 

In the long term, of course, Osborne’s reputation is tied to whether Budget 2010 works in the long term. But there are so many factors beyond his control in that consideration that there will be plenty of wiggle room if it doesn’t work. The strategic victory Osborne has brought about is actually to move the debate away from where New Labour had it (i.e. on what do we spend more money) and towards where the Conservatives want it (i.e. what taxes do we cut). If the tax cuts in Budget 2012 are well-chosen, Osborne can entrench this attitude. And that entrenched attitude will be the greatest asset for the Conservative party come election time in 2015.

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