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Archive for March 2009

Jacqui Smith, it time to resign

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I am not normally one for calling for an MP’s resignation, albeit I am sure I, like many others would consider that there are a good number that should do so voluntarily. That said, I am of the opinion that Jacqui Smith needs to go and soon, not because of a single misdemeanour, but a series.

The bottom line is Jacqui Smith is not very good at their job. She is the first to try and manipulate the press and public opinion with elements of “good” news from reports, whilst blatantly ignoring those aspects which are critical or not self-serving, either for her or the government. Fair play some might say, but ministers must be judged on what they add, not what they claim.  Further, Jacqui Smith is something of a puppet, if the police want something, she believes that by giving it to them, she is helping the public, because the police only want to fight crime etc., this is utter rubbish. The police want more powers to intrude, monitor and spy of ordinary citizens and Jacqui Smith is seen as a soft touch. As a consequence the people of this country have seen a massive erosion of their civil liberties, right to privacy and freedoms.

My issue with Jacqui Smith is the utter and barely concealed contempt she has for the public at large, not just in terms of her actions is respect of her ministerial responsibilities at the Home Office, but also, her actions in respect of maximising her personal finances via the public purse. Whilst Jacqui Smith may be able to claim that she has operated “within the rules“, to quote one of her colleagues, “in the court of public opinion“, her expense claims are not acceptable in the least.

First she claims up to £24,000 per year because she says that her main residence is the room at her sisters house in London, not Redditch where her husband lives and her children reside and go to school. There is little or no credibility in this explanation. Then she claims for electrical goods, which includes two washing machines, why does she need two washing machines? Why should she feel the need to claim for two flat screen TV’s, what is wrong with one, why do they have to be flat screen? £550 for a kitchen sink….£1,000 for an antique fireplace, are these truly essentials, I think not. In the old days, expenses were referred to as “out of pocket expenses“, for an MP, they are nothing of the sort, instead they are used as a method of supplementing salaries.

What I find difficult to believe is that Jacqui Smith seriously expects the public to believe that she did not know that her claim of £69 per month was only for the internet and nothing else. It would suggest that she is both out of touch with the real costs we face everyday and implies that her attention to detail is very badly and sadly lacking. For a Minister in charge of the Home Office and therefore our security this is a very real worry. Moreover, someone that claims to operate within the rules whilst ignoring the spirit of the arrangement is, at least in my opinion, lacking judgement and credibility. If Smith was doing a good job, perhaps the public would be more forgiving, but she is utterly useless. The only consolation is that most of her fellow ministers are as inept, therefore she fits in well, but that doesn’t make it any better. She will survive, but only because Gordon Brown know that the by supporting her he can benefit from undying loyalty and that having a cabinet full of incompetents makes him look better.

I am further angered at the way that Gordon Brown has insisted that there should be a review of MP’s expenses, yet it cannot start until the end of the summer recess and has no need to report until after the next election. Once again, we are all being taken for fools, it simply does not take that long to review MP’s expenses. The bottom line is expenses can and must only cover ‘out of pocket’ expenses, they can and should be based on those in the private sector and second home allowances must stop. MP’s can be provided with an overnight allowance for when they are in London on parliamentary business, but his should be weighted based on private sector allowances for accommodation and food.

The review of expenses ought to be carried out by a firm of accountants and the brief include a requirement that they revise them to fall in line with the private sector. I reckon it will take about 2 weeks, but of course, we know that these self-serving MP’s are going to insist that they receive a salary increase in place of any ‘sacrifice’ they make on expenses. They also know that they will then get a doubly whammy, because a higher salary means a better pension, all funded by us. For a government so focused on targets, why don’t they pay themselves performance and results based rewards? Simple, not one of them would earn the bonus, they know it and we know it!

If MP’s don’t like the terms or rewards of a parliamentary career, then they must resign and make way for others that do. One thing is for certain, based on the rank incompetence demonstrated by the majority of our MP’s we shall be no worse off and in all likelihood, we will end up with real people that represent the interests of the public at large, not just themselves. It is time for change.

Anyone that is angered by the information contained in this post may also like to be aware that there is a new Bill going through parliament which seeks to provide MP’s and all other public servants with what amounts to an immunity from prosecution (civil and criminal) with a legal definition of the term ‘reasonable discretion’. You can find out more here: Bill to Exercise Reasonable Discretion

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Tony McNulty and an expense claim too far

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I am angry with Tony McNulty, because, although I disagree with most of his party’s policies, I always considered him to be sincere and committed to the policies adopted by New Labour. He was believable and one of the few ministers who could hold his own when challenged by the likes of Jon Snow’s  on the Channel 4 News programme, without sulking. Therefore, to find out that he was one of the members of parliament exploiting the rules related to second home allowances (which was designed to cover rent, mortgage interest payments or hotel expenses) was a great personal disappointment. I do not suggest that McNulty has done anything in contravention of the rules or regulations, but to claim as much as £60k in expenses for a home his parents live in, when it is just a few miles from his home, is truly stretching what could be termed, at least in my judgement, reasonable.

Members of Parliament are supposed to set an example to the rest of us, they are in a privileged position and as such, we are entitled to expect the very highest standards from those who are elected to serve the people. By and large, MP’s tend to vote and decide on their own salaries, perks, pensions and expenses, therefore is it essential that they are seen not to put self-interest first. It is quite clear, to anyone with half a brain cell, that second home allowances were intended to assist those MP’s who lived in their constituency and needed to cover their additional costs in terms of travelling or overnight accommodation in London. It was never intended to be a tax free perk, but that is precisely what it has turned out to be for many. They know that and we know that. Can Tony McNulty really justify his claim, when his permanent home is so close to Westminster, not in terms of the ‘rules’, but in terms of the spirit of the allowance? He may be an excellent debater, but even he will not be able to come up with a set of words that would convince me, let alone the public at large. To his credit, however, he has suggested that the home allowance rules ought to be reviewed.

This discredited expense system, that has become a method for MP’s to boost their earnings, needs to be overhauled NOW! Not by members of parliament, because most of them have demonstrated that they cannot be trusted to demonstrate objectivity, much less intelligence and independent thought, but by a committee of lay people. No longer is it acceptable that MP’s should receive benefits that those in the private sector could only dream of. MP’s need a reality check, they are so insulated from the people they govern, that they seem to have no idea how to act responsibly or appropriately. There is a recession going on out here, people are losing their jobs, companies are closing, families are becoming homeless, personal wealth is falling at an alarming rate and no-one in power seems to give a toss, so long as they are okay.

Ask the average MP why he decided to go into politics and you will get dozens of different answers, but I guarantee that they will not say they did it for the money, yet on closer analysis, it appears that greed (if lawful greed) is the order of the day. If MP’s earnings are so low that they feel they must maximise expense claims whatever the morality, then I suggest they step aside and let ordinary people take their place at the next election. God knows, this country needs people that are in touch with reality, rather than on a different planet.

Gordon Brown needs to get his house in order and Cameron needs to come off the fence and make some recommendations regarding a review of expense allowances, not simply insist that MP’s publish an account of their past expenses. Sometimes I think Cameron is even more removed from reality than Gordon Brown, now that is scary, especially given he may be our next prime minister. The bottom line is, however, that there are few people in this government that deserve their positions, starting at the very top, but I am becoming more and more concerned that there are an increasing number MP’s, from all side of the house, that do not deserve to be described a honourable nor are they fit to represent the good and predominantly honest people of this country.

UPDATE:

Anyone that is angered by the information contained in this post may also like to be aware that there is a new Bill going through parliament which seeks to provide MP’s and all other public servants with what amounts to an immunity from prosecution (civil and criminal) with a legal definition of the term ‘reasonable discretion’. You can find out more here: Bill to Exercise Reasonable Discretion

Another Jacqui Smith gimmick

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Not for the first time, Jacqui Smith demonstrates what a naive politician she is and how she will do anything to grab the headlines. Once again, however, she managed to put her foot in it. This time, the subject matter, part of the government’s gimmick a day programme, was a domestic violence initiative, whereby, the government is proposing the setting up of yet another database, this time to register known abusive partners.

Clearly domestic violence is a serious issue and I am all for a tough line being taken on offenders. But, during a round table discussion, Sandra Horley, Chief Executive of Refuge, a women’s charity, said: “We have had enough talking – we need action. As for the perpetrators’ register, it is a gimmick and doesn’t address the root problem. The Government is hoping to get away with useless initiatives like this register and it is hypocritical to sound tough and do little.” Fair point from someone that should know. But, my problem is that any initiative of this type must be gender neutral, Ms Smith’s comments would indicate otherwise.

On a breakfast TV programme, Ms Smith said “Violence against women and girls is unacceptable in any form. We’ve already made real progress with domestic violence incidents more than halving in the past 12 years. But I want to start a national debate on what more we can do to prevent it and challenging attitudes which condone it.” Once again, in her ‘foot in the mouth’ style, she makes it a gender issue, when there are countless statistics that demonstrate that men are also victims of domestic violence. What really annoys me, is in an attempt to suck up to female voters, ahead of an election, she detracts from the initiative by implying that it is gender specific.

I am all for the introduction of bold initiatives aimed at combatingdomestic violence, irrespective of gender, but such programmes need early discussion with groups that understand the problems and challenges. Governmentofficials must never seek to launch an initiative before it has broad support from those that havethe knowledge and experience to make a tangible contribution. The way this initiative was launched, was typical of Jacqui Smith and her spin obsessed government. So much for Gordon Brown’s promise to stop Labour spin! There was some consolation that Ms Smith was berated in public, although I suspect somehow, she will be too thick skinned to realise what a complete idiot she looked. Hopefully, this clumsy announcement by Jacqui Smith will not discourage interested groups from coming up with an alternative proposal that is gender neutral, has general buy-in and is workable in practice.

It is high time that this government and its ministers understood that the public will not tolerate serious issues such as domestic violence being used to gain a cheap political advantage. The press launch was quite clearly an ill-considered, pathetic attempt to gain news headlines with little or no substance behind the announcement. The public demand that issues such as this be dealt with in a serious, considered and practical manner.  Jacqui Smith is long past her sell by date and should be removed from her post, although that is highly unlikely, given it is only her rank incompetence that makes Gordon Brown look slightly better.

UPDATE:

Anyone that is angered by the information contained in this post may also like to be aware that there is a new Bill going through parliament which seeks to provide MP’s and all other public servants with what amounts to an immunity from prosecution (civil and criminal) with a legal definition of the term ‘reasonable discretion’. You can find out more here: Bill to Exercise Reasonable Discretion

Harman does it again

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At PMQ’s Harriet Harman made the following statement in response to a question about who had put Fred Goodwin forward and why; “I think Sir Fred was nominated for a knighthood because of his services for the Prince’s Trust.  “I understand it was not in recognition of his services to banking.”  Tut, tut Harriet, have you learned nothing? If you want to be PM in waiting you don’t try and guess the answers, you can only do that when you have the position, ask your boss! This statement has since been corrected by an official from her office.

But what does it tell us about Harriet Harman? It is, after all, only a few days since she suggested that the government would consider introducing new legislation, which would then be made retrospective, to enable the government to reverse Sir Fred Goodwin’s pension entitlement. Now, whilst I accept that there are at the very least, moral reasons why Sir Fred should not receive this pension, the fact remains that government ministers were party to, if not fully au fait with, the content of a compromise agreement, which is legally binding on all sides. To make matters worse, any threat to introduce legislation designed to target one citizen is a draconian move and anyone supporting or suggesting such an act must be considered a threat to all of us, especially when they are from a government that has paid lip service to civil liberties.  Sir Fred is NOT deserving of a pension in my view, but surely there are other ways in which this can be dealt with, for example, whether or not he had failed in his fiduciary duty?  If he had not, then there would, presumably, be some form of legal recourse using existing and established law.

In my view, Harriett Harman has, in the past week or so, confirmed why it is that she will never be a viable candidate for prime minister (or, more accurately, leader of the Labour Party).  Firstly, her judgement; no minister, whatever the motivation or justification should ever seek to use the immense power of government to target a single British subject. No-one deserves that, not even Sir Fred. Secondly, her knowledge on the subject matter; how is it that Ms Harman can claim to know all the details surrounding Sir Fred’s pension arrangements and the negotiations thereto, but not why Sir Fred was nominated for a knighthood and by whom? As Alan Duncan said, “Instead of worrying so much about her campaign to succeed Gordon Brown, she should focus on mastering the detail.”

I find it difficult to recall anything useful that Harriet Harman has ever done during her time as an MP, though I am happy to be corrected on that one, any takers? That said, at the risk of arguing against myself, perhaps that is why she would make a good leader of the Labour Party for their period in the wilderness which is certain to come after the next election. But PM, never, at least not in my life time, of that I am certain.

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4 March, 2009 at 5:19 pm

Have the bank directors failed in their fiduciary duties?

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Whilst doing my rounds today, I came across this article which points out that all directors have a legal duty of care or, if you prefer, a fiduciary duty. The author then asks why it is, that bank directors have been allowed to resign, rather than be sacked, given the government are suggesting that these bank directors have failed? It is a compelling argument.

Theoretically at least, if any director failed in their fiduciary duty, acted recklessly or without due care then, not only could they be sacked, but they could find themselves liable to a civil action. That notwithstanding, it is clear to me, that if ‘trust and confidence’ is an integral part of a fiduciary’s duty, then there has been a failure.

I cannot argue with the sentiment, so lets be clear, one government minister after the other has been heard to repeat the term used by Gordon Brown, that there must be “no reward for failure“.  Similarly, there must be no amnesty for anyone that has failed in their fiduciary duty or that has acted recklessly or without due care.  The author goes on to say;

These individuals have either failed or they have not, ministers must be careful in making damning statements, yet failing to back them up with appropriate action.

Surely government ministers understand that if they are going to step up the rhetoric, then they need to follow these statements with firm action? Anything less would be unacceptable to the general public who are now massive stakeholders in these banks. Moreover, if I were a former bank director, I would welcome the opportunity to clear my name, assuming of course, that I had a defence to the charge.  The article is pretty well summed up as follows;

I am not qualified legally or otherwise to determine whether or not any individual director has failed in their fiduciary duty. Therefore I am not suggesting anyone (bankers or otherwise) has acted improperly, I am relying only on the governments own words, that there should be no reward for failure, which implies that there has indeed been a failure. However, in the “court of public opinion” I would like to state for the record, that I believe there is merit, perhaps even a duty, for the government to seek legal advice on this matter, because they, as a majority shareholder in these banks, have their own fiduciary duty to the shareholders, you and me!

I agree! So lets see some action from government ministers instead of hot air.

SNP to solve the drinking problem in Scotland!

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The SNP, in their infinite wisdom, have decided that they can curb the “alcohol misuse” problem by increasing prices. If only it were that easy. It is a laudable initiative to want to address the excess drink culture that has become the blight of many neighbourhoods over the past 10 or so years, but experience suggests that putting up prices or imposing additional duties/penalties is not the way to go.

We all know that a car can be a very dangerous weapon in the wrong hands, but no-one has suggested that they shouldn’t be discounted. Why? Because it is the driver that is ultimately responsible for the car becoming a weapon. Therefore, perhaps the SNP should consider increasing the penalty on the minority that cause trouble as a result of their bad behaviour, rather than using a sledgehammer to crack a nut and punish everyone as if they were all naughty school children? I have long believed that alcohol fueled troublemakers should be arrested, held overnight in an uncomfortable cell, then the following day they should be fined in proportion to their income/earnings. Perhaps 2 weeks income or wage, which should be paid before they are released. This is a reasonable deterrent, given it reduces the available income to the individual, hitting the problem at source.

Instead, the SNP are suggesting a ‘penalty’ for ALL Scottish drinkers, which the responsible people are likely to find insulting. Furthermore, how on earth do the SNP believe it can be enforced? Are they going to have border guards at every entry point to Scotland to prevent alcohol smuggling? What is to stop people living in Scotland from travelling just over the border to buy their booze? I think this could be a massive opportunity for any entrepreneur with a penchant for retailing and living a stones throw from Scotland.

 We are of course having the usual suspects wheeled out to lecture us on how alcohol is bad for our health and adds to the cost of the NHS. We know that, but we still drink, it is legal and, we are for the time being, in a ‘free’ society. But it is also worth noting that if everyone stopped drinking tomorrow, the loss to the Treasury would be £3obn a year…anyone want to see their direct taxes go even higher? I don’t think so. The reality is, drinking is not about price or availability, the binge drinking problems are the preserve of the minority. Better policing, enforcement and higher penalties would be a better, or if you prefer a more targeted method of dealing with the issue. Raising prices is good for headlines, but it is not a solution, in fact it is likely to lead to more crimes being committed, this time, perhaps, it will be smuggling.

Mind you, if I heard daft ideas like this coming out of my government, I suspect I would start drinking, perhaps even to excess.

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3 March, 2009 at 8:17 pm

Is Harriet Harman is an opportunist?

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It is difficult not to conclude that Harriet Harman’s attack on Sir Fred Goodwin’s pension is anything other than opportunistic. Clearly she will be aware that public opinion is firmly against corporate greed and any form of reward “for failure”. However, if government ministers were to be judged on the same criteria, there would be mass resignations, no pay-off’s and a refusal to take their generous, gold-plated pensions. Of course we all know that isn’t going to happen.

It is fair to say that Sir Fred’s pension is obscene and that the board and Lord Myner’s should have dealt with this thorny issue at the time, but they did not. Instead, it would appear that it formed part of what is commonly described as a ‘compromise agreement’ and this is, whether government ministers like it or not, enforceable in a court of law. Compromise agreements are not the exclusive preserve of high ranking banking officials, many thousands of people every year enter into some form of compromise agreement with their employers, with each party fully appraised by their legal advisers of the consequences.

It is difficult to conceive that any credible member of parliament would possibly suggest that a compromise agreement ought to be overturned through the introduction of new legislation which is applied retrospectively. Yet, Harriet Harman has done precisely that, whether it was her own idea, or someone has ‘suggested’ that she become the sabre rattler is not clear, either way, she does not come out of this with any real credibility. Yes, the public will, at face value, agree with her and therefore, it will appear that she is in tune with the masses. However, this completely ignores the fact that a Labour minister was party to the pension discussions and that the government were aware of the compromise agreement back in October. Yet it has only come to light now, when there was a need to divert attention from the real issue, which is the massive injection of additional taxpayer cash into RBS and the taking on of massive potential liabilities through the underwriting of so called ‘toxic assets’.

There have been suggestions that Harriet Harman has been positioning herself to become the successor-in-chief to Gordon Brown, I don’t know how much truth there is in these rumours. However, if I wanted to set her up for a fall, I would have asked her to do precisely what she has done. Why? Because no minister ought to be proposing new legislation to reverse something in a contract, that they were party to (directly or otherwise), simply because they no longer like the terms. Once that happens, the government can no longer be trusted to enter into any contract, without the other party believing that there is a possibility that any terms could subsequently be overturned, on a whim, through retrospective legislation.

Whatever the rights or wrongs of Sir Fred Goodwin’s pension arrangements, ministers from the Prime Minister down appear to be milking it for all it is worth and in doing so, they are successfully diverting the country’s attention from the real issue and that is our massive long term exposure to RBS liabilities. Worst still, if they are expending so much time and effort on what, in the scale of things, is a peripheral issue, can we trust them to be steering the ship in which we have so much invested? I wonder!

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1 March, 2009 at 2:06 pm