Thursday, 30 June 2011

New homes wanted

When the economy is at a low ebb, it is the poor and vulnerable that suffer. Most independent commentators would not dispute that the UK ‘s economy has been in the doldrums since the misdemeanour of the bankers destabilised the financial world and it in turn had a knock on effect on the real economy.
In Wales one of the consequences of the economic down turn has been the increase in those that are homeless and the number of families in bed and breakfast accommodation. Welsh Councils saw 6,255 households seek their help last year as opposed to 5,565 the year before. This staggering increase of 12 per cent between the two years in question should be a cause for real concern. 
These figures have not gone unnoticed by our First Minister. In responding to the figures Carwyn Jones blamed Whitehall. Why? Because of the Coalition government’s welfare reform plans and their  “spending cuts on vital public services.” 
He acknowledges the role of the economic crisis on homelessness but said that “I believe the UK Government’s regressive economic and welfare reform policies are making the situation worse.”
Without doubt some of the proposals on housing benefit will result in many more falling into arrears and eventually being evicted. See blog  

But if the First Minister has “a responsibility to defend the interests of all the people of Wales, especially the most vulnerable, whose voice is often the quietest.” Then what’s he to do?
Well, as Nick Bennett, Community Housing Cymru boss says when commenting on the homeless figures “These figures are distressing and frustrating. Homelessness has been falling over the previous period as we saw investment increase and better regulation from the Welsh Government increase housing associations’ ability to do more- that ‘s how we met the 6500 One Wales target. We need to do even more during more austere times when grant funding is being cut. We have made the offer to the new Minister – that Housing Associations are ready to invest £250m, and to build at least 1500 units with no grant- in return for continued good regulation, a sustainable rents policy and a renewed partnership approach to innovation, including possible bond finance and special purpose vehicles.”
But the social housing sector is still awaiting a response from the MInister. The situation is urgent and requires a swift response, so that the increased tide of homelessness can be halted and reversed. Prevarication should not be a policy option.
Housing supply has to be increased. In the One Wales coalition government a target for housing was set and exceeded, no new target has been set by this government. 
Carwyn Jones has rightly pointed out that changes to housing benefit are causing serious problems, but he can insist that his Housing Minister take action to lower rents in the social housing sector by increasing the capital subsidy going into each new house built or renovated. 
For years the Welsh Office budget has been able to get away with a high rent policy in the social sector, because it meant that another Whitehall department would might the costs through benefits. Now is the time to reverse this and make rents cheaper. 

An increase supply of new houses built that are at a high rent will do nothing to help the vulnerable or decrease the levels of child poverty. Both high on this Government’s agenda.
As Carwyn Jones said in a recent conference “Decent housing is fundamental to life in Wales. Everyone in Wales should have a roof over their head, warmth, food and security. This, surely, is the minimum aspiration for a developed and civilised country.” And who can disagree with him. But it is up to him to make it happen, not Whitehall.

Monday, 27 June 2011

No growth in Wales

Who ever coined the phrase that economics was the “dismal science” is hardly likely to have Wales in mind but the word dismal would be apt in describing Wales’s economic performance.

It’s ironic that whilst Wales has taken control of its own governance it’s economy seems to be out of control. The country has gone backwards economically since devolution.

In 1989 the GVA, previously known as GDP, of Wales was 84.3 per cent of the UK average of 100, England was 102.3, Scotland, 96.0 and bottom of the league Northern Ireland was 73.1 per cent. When Wales started the road to devolution the figure had slipped back to 77.3 per cent, as too had the Scots to 94.5 per cent with Northern Ireland overtaking Wales for the first time with 79.4.

After ten years of devolution the Scots have steamed ahead nearly on the UK figure of 100, with 98.8 per cent to be precise, Northern Ireland have maintained their position as have England. But Wales has slipped even further back and has a GVA of only 74,3 percent. Not only is Wales bottom of the nation league it is also bottom of the league when compared to the regions of England. If it were a football club Wales would have been relegated to a minor league.

Not an inspiring story, me thinks. It is an especially depressing story when account is taken of all the help the Welsh economy has had from Europe. From 2007 to 2013 Wales  either has received or will receive £2 billion from EU structural funds. Not an insignificant cash handout you'd agree. But where has all the money gone? Clearly, not spent on getting the economy up and running. It is has been used in various social engineering schemes. Worthy, but is it using this money wisely and to good effect?

Just to depress you further, dear reader, things are about to get worse. 

Our lack of entrepreneurship has made us over dependent on the public sector for jobs. Cuts in this area will be 10 per cent in real terms over the next four years. This is likely to hit the Welsh economy particularly hard, as the proportion of the workforce employed in the sector is greater than most elsewhere in the UK.

If you’re a youngster in Wales your job prospects are bleak. They make up just under half of the 115,000 people of working age unemployed in Wales, despite being just a sixth of the total working age population.

Why has Scotland, and to a lesser extend Northern Ireland succeeded, when Wales has failed. Undoubtedly Scotland has succeeded because it has a greater control over fiscal matters and is likely to even have more such powers shortly. Wales in the form of Carwyn Jones seems reluctant to go down that particular road.

Scotland has Scottish Enterprise a quango that encourages economic development. Wales decided to scrap the WDA. Maybe Wales would have been better employed culling its badgers rather than its quangos.

Well, now the ball is in Edwina Hart’s court. It’s now up to her as the relevant minister to reverse the economic decline. European Funds have to be used to encourage enterprise. Wales needs to be a can do Nation. Control of Corporation tax and Income tax could help create such a culture. For that she needs to lobby the First Minister to give her the fiscal tools to do the job. Unless these things happen Wales will continue to be a basket case economy.

Wednesday, 22 June 2011

Badgers gain reprieve

To cull or not to cull that is the question.  It may be a question for the Welsh government but has not greatly concerned this commentator.

The merits of culling badger or not, is hardly a topic for polite company. Surely it should be left to the letters page of the Farmers Weekly and not of great concern to us townies. 

Well, why are you writing about you may ask? Ah, a perfectly valid question and one that deserves an answer.

It is not because I’ve inherited a pair of wellies or that I’ve watched too many episodes of the Good Life on Comedy Gold. No, it’s because it gives us an insight into how things will be for the Welsh Government, now that they’ve decided to go it alone.

When John Griffith the Minister with responsibility for animal welfare announced to Assembly Members that he wasn’t minded to rush headlong into a badger cull. Oh! No, he wanted a review of the science on how to eradicate Bovine TB.  Does one detect a rapid crash of the gear box as it is pushed into reverse.

As members of the Labour-Plaid coverage both John Griffith and Carwyn Jones backed the cull. What then has changed? Well, certainly not the science.

No, there hasn’t been a breakthrough in treating the disease. No one has shouted, “eureka, I have the cure”, the science remains the same. Neither the scientific or rural landscape has changed since Elin Jones the previous Rural Affairs Minister took the decision to cull. The change that has occurred has been to that of the political landscape.

Having no majority but still deciding to govern alone Carwyn Jones, the First Minister, has now become a prisoner of his own backbench members.

There are many of his backbenchers that have little sympathy towards rural Wales and see badgers simply as cuddly animals. They would never have allowed their government to move towards a cull. In the light of this, Mr Jones and Mr Griffith have decided to appease them by prevaricating. They both live in hope that the Chief Scientist and inquiry will get them off the hook.

Now this about-turn may not cause a great loss of sleep to Carwyn Jones and his urban focused Cabinet, but it surely should. For now that his Labour backbench members have tasted blood they’ll want more. Where will it all end?

Carwyn Jones should worry if the centre of power moves away from the cabinet room to the Labour group. Or, does what caused yesterday’s statement and u-turn, move an early return to coalition government much higher up our First Minister’s agenda.

Friday, 17 June 2011

Wrong horses entered?

The two-horse race is underway for the leadership of the Tory Party in Wales. The other contest for the leadership of Plaid Cymru is pending but they‘re not under starters orders, yet!
The contests may result in both the parties saddling themselves with the wrong leader.

Lets first look at the Tories. Here we have the kind of contest that often happens right of centre against left of centre. Andrew Davies comes from the landowning farming, dare one say it, squirearchical wing of the party. His appeal will surely be to the traditional wing of his party.

Nick Ramsey represents the more progressive centre of his party. He could be described as a consensus seeking meritocrat. If Nick Bourne were to anoint an heir, Ramsey would surely be the one.

It is difficult for a journalist without access to the membership list to make an informed judgement as to how the contest will go, but having covered  many of their conferences I can observe that the Assembly Members are a great deal more progressive than the rank and file. 

Draw your own conclusions as to how they will vote. But what can be said is that it will be the wrong leader for the next stage of development for the Welsh Conservatives.

Despite the party opposing the establishment of the Assembly over the years it has gradually moved from antagonism, toleration and now to down right love of the institution. 

And little wonder, because from the total rejection of the party by the Welsh electorate in the Blair landslide of 1997 the Welsh Assembly has allowed them to claw back into the esteem of the Welsh voter. Indeed they have replaced Plaid Cymru as the official opposition gathering an unprecedented return of twenty five per cent of the vote in the last Assembly elections.

Now to build further on this vote they need to underline their Welsh credentials. How better to do this than have a Welsh speaker as their leader in the Assembly and their de facto leader in Wales.

None of the current contenders fit the bill, but there is a man that does. None other than their current leader in Wales, Paul Davies. Ok he’s only holding the fort until the Tory members make their minds up in July. But in his temporary role he‘s proven to be able, astute and a safe pair of hands, and he’s thoroughly Welsh. Under him the Tory reach could go to parts of the Welsh electorate body hitherto undreamt of. But alas it’s not going to happen, yet!

Now Plaid Cymru have the opposite dilemma. Their support amongst English speaking Welsh voter is low. They’re seen as a party for Welsh speaking Wales.
Some years back the party’s internal polling told them so. Their response, wait for it, they changed their logo. Dropping the three green hills of Snowdon and replacing it  with the yellow Welsh poppy.  No one ever explained how this would make  the party more English in its appeal. But nevertheless that was the intention, but clearly whatever the intention it did not succeed as the last election results clearly demonstrate.

So the perception remains that it’s a party for the Welshies.

Now what clearer way of demonstrating that this isn’t the case by electing a non-welsh speaker as their next leader.

But who have they got?

Could Jocelyn Davies be the very person that fits the bill? She’s astute, was a successful government minister and not to be sniffed at in politics a useful behind the scenes operator.  Many attribute the One Wales agreement to her negotiating skills. She’s from the coal mining Valleys and, of course, is English speaking.

Well, she clearly ticks some of the right boxes. Yes the boxes the party need to see ticked if they are to make electoral headway. 

But will the party choose her, the answer is likely to be no. Why? Because the bulk of Plaid Cymru’s membership live in the North and the West, the Welsh speaking heartland. The odds on these electing a non-Welsh speaker are small indeed

So not for the first time in politics we see our political parties being held back by those very people that would have most to gain from electoral success. It is the irony of it all that makes politics so fascinating.

Wednesday, 15 June 2011

Unemployment, inflation and Wales

The announcement of today’s modest drop in unemployment is a very small ray of sunshine in what otherwise is a pretty bleak economic scene.

In Wales unemployment has dropped by 9,000 (0.7%) on the quarter to 115,000 (7.9%), which is 10,000 lower than the same period last year. Although worryingly the claimant count has risen by 1,700 in the past month to now stand at 72,400.

These figures may only just be a small respite before the Public expenditure cuts really start to bite. Against such a background Carwyn Jones’s Legislative programme seems worthy but totally inadequate to deal with the economic realities facing most Welsh people.

Many may argue that the Welsh Government haven’t really got the economic powers to deal with the systemic problems of the Welsh economy. True, but there does seem to be a marked reluctance on our First Ministers part to grab the fiscal powers the Westminster government are prepared to devolve to Scotland and Northern Ireland. Let’s hope that he has a change of heart before he gets on his feet to make a statement next week.

Delivery is the key word on the lips of most politicians. Carwyn Jones is even going to establish a delivery unit, whatever that may be.  So let’s hope that he delivers on fiscal powers.

Another who has failed to deliver is Mervyn King or as we must now learn to call him Sir Mervyn.  How would the Bank of England fare if a delivery unit measured their performance?  No gold stars here, methinks, for their delivery in dealing with inflation. 

According to the Office for National Statistics the latest figures for the UK Consumer Prices Index shows inflation again running at 4.5% or if you take in the Retail Price Index of inflation, which includes mortgage interest payments, it is running at 5.2%.

Now the Bank of England has set the target for inflation at 2%. The latest figures show the rate running at twice this amount. Now this target has been missed not once but 34 times in the last 40 months. If punters put their shirts on horses with the same degree of success, the M&S men’s wear department would be experiencing an unprecedented growth.

What’s the Bank’s response to this? Well, precisely, nothing. Why? I hear you ask, because they can’t risk affecting the recovery. Preventing the economy dipping into recession is the only game in town. So interest rates will be kept at these historic low levels for much longer than is prudent for the economy and the most effective tool in the armoury of countering inflation – raising interest rates – is not to be deployed. The unemployment figures although welcomed do not indicate any great growth. So the Bank will give us more of the same.

Now who will suffer with interest rates being kept at a record low of 0.5% for the 27th month in a row? Well, as Cilla Black would say surprise, surprise it’s the poor. So, nothing new there, then.
According to the Institute of Fiscal Studies, people on low incomes have suffered higher inflation than those on higher incomes in the past decade.  The IFS reckons that pensioners on state benefits had been especially hard hit.
It doesn’t take an Institution to tell us why. For only the relatively better off owner-occupier have benefited from the lower mortgage rates courtesy of the Bank of England’s low interest rate policy.
So the relatively rich are better off but the poor suffer because of the Bank’s inaction on inflation. It was always thus. People on lower incomes who spend a higher proportion of their money on gas, electricity and food will have suffered disproportionately because of the sharp rise in these essential items.
The question for the Welsh Government is this, if Sir Merv and his Bank of England continue with their current policy how will Carwyn Jones and his team stand up for these very vulnerable Welsh people and what weapons will they deploy?

Thursday, 9 June 2011

More cash wanted

“No taxation without representation” was an effective political slogan used by the colonists in the New World to tackle their lack of representation in the mother Parliament.  

“Representation without taxation” as a slogan doesn’t have the same resonance. But this is the line that Carwyn Jones seems to be pushing in his dealings with Mr Cameron.

Yesterday, the First Minister ruled out the Welsh Assembly having tax varying powers. His line seems to be that Wales is underfunded, so give us more cash to spend. End of story.

He is right in arguing that Wales is underfunded but quite wrong in closing his mind to taxation powers.

With Scotland and Northern Ireland pushing for more fiscal autonomy from HM Treasury it is doubtful if Mr Cameron will concede to Wales a system that increases the Treasury contribution without some measure of responsibility resting on Welsh Ministers shoulders.

After all even the smallest Community council has to raise its own money for its pet projects. Why should the Welsh Government be treated differently?

The thrust of the First Minister for Wales case that the country is under funded, rests on the cogent arguments produced by Aberdare born economist Gerry Holtham. In a report produced for the Welsh Government he proved conclusively that Wales was being short changed.
In Holtham’s view the Welsh Government should pursue with the UK government a needs based formula as a means of determining the Welsh block grant.
To be fair to Carwyn Jones it is this strategy that he was pushing in Number Ten, yesterday.
But in pushing that strategy the First Minister seems to be blinkered to the rest of Holtham’s recommendations. Namely, that part of a Treasury block grant should be replaced with revenue raised from Welsh taxpayers.
Holtham and his fellow commissioners wanted ministers to be able to vary the basic and higher rates of income tax by up to 3p in the pound.
The First Minister’s opposition to such proposals beggars belief.
Surely there is something inherently wrong in a democracy for a government not to want to raise its own cash.  It prefers to push for an increase donation to its begging bowl from central government and seek no direct payment from the voters that put them in the job.
It surely should be the aim of government here in Wales in the next five years to reduce dependency on central government grant and increase its reliance on revenue from the voters that elect it. This would surely make for a more accountable government.
The announcement, today, that Scotland will have increased borrowing powers must point to Wales shortly been granted the same. So more fiscal control will come despite Carwyn Jones’s is reticence. Taxation would be a good place to start.
Lord North lost the colonies because he didn’t make the connection between taxation and representation.  It’s always a mistake not acknowledging that they go together. The Welsh Government should wise up to the fact.

Tuesday, 7 June 2011

Whose for the carpet in the Assembly?

She came; she stooped, and conquered most Assembly Members with her charm. But what does it amount to. Well, the fourth Assembly is officially under way. And that’s about it.

There was plenty of pomp and circumstance. Brass bands galore, a fly past by fighter jets, judges in their wigs and gowns, harpist’s choirs and a day off lessons for many a primary school child.

So as they tuck into their vol-au-vents and champagne the Welsh crachar can all reflect on a ceremony that went smoothly and to plan.

But what was the plan, you may ask? Now, that is a question.

Before the successful referendum that gave the institution real status as a law making body, there may have been some point in asking the Queen turn up, in the hope that some of her reflected glory would pass on to the toothless institution. But now, there is no longer a need for that kind of symbolism.

Let the Queen turn up with a purpose. It would hardly be innovative to ask her to read a speech that spells out what the government intend to do these next five years. Yes, a proper Queen’s speech.

And would it be too much to ask our politicians to forgo their vol-au-vents and head back into the chamber and debate the programme. Yes, let politics begin.

It’s a scandal that the Assembly election having taken place in the beginning of May and, apart from elections of Presiding Officer and her Deputy and Carwyn Jones as First Minister, nothing meaningful has happened in the Assembly in that time.

Not a committee chosen, let of all met. Not a word on what laws we can expect to be placed. Nothing. A snail on speed could hardly have done less.

Ieuan Wyn Jones the leader of Plaid Cymru decided to extend his holiday and missed the opening ceremony. And why not. For he hasn’t missed anything much. Unless, of course, you’re into uniform and men in garters. Politicians that are in a rush to condemn him might reflect on their own workload this week.

To sum up the day. A good day for Welsh freeloaders of which there are many. A good day for hatters.  But bad and sad day for Welsh politics. 

What indeed are those Welsh people that are heading for dire economic times to make of it all? Not a great deal one would think.

Friday, 3 June 2011

The "void two"

Since the seventeenth century MPs have not been able to resign their seats. The anoraks amongst you might like to know that only deaths, disqualification, elevation to the Peerage, dissolution or expulsion can see them out of the Commons.

Members have to go through the rigmarole of applying for a paid office of the Crown, which automatically disqualifies them. There are two such offices; they apply to the Chancellor of the Exchequer for, the Crown Steward and Bailiff of the Chiltern Hundreds or the Manor of Northstead. 
Now in the Welsh Assembly members can just resign. No need to apply for the stewardship of Llancaiach Fawr, or to be Bailiff of Splott Manor or the prestigious role of Crown Constable of Caerffili Castle. No we’re an utilitarian lot, no room for romance in our political institutions.

The same goes with the way that elections are declared void. Even Phil Woolas’s election was declared void after the excitement of a court case. In his case he fell foul of the Representation of the Peoples Act 1983 which makes it illegal to make false statements of fact about another candidate. The courts found that he had lied in leaflets about his Liberal Democrat opponent and out he went.

Perhaps the most famous void case of the last century was that of Tony Benn. He inherited a Peerage on the death of his father in 1960 but wanted to remain in the Commons. He fought a by-election, the voters in Bristol returned him but the election court turfed him out. The Courts did this despite knowing that the Bristol’s voters were fully aware of Benn’s campaign and circumstances surrounding the election. No, the court disqualified him and gave the seat to the Tory Malcolm St Clair.

Benn had to wait for three years for the law to change. But return to the Commons  he did, courtesy of a by-election. A by-election caused by St Clair claiming, yes you’ve guessed it, the Stewardship of the Manor of Northstead.

Now the two aspiring Liberal Democrat Assembly Members were declared void, not because of the way they campaigned like Woolas nor either on principle, like Benn, but why you may ask?

Because of a list. Yes, but not any old list, but a list of organisations spelt out in “The National Assembly for Wales (Disqualification) Order 2010.”  If you belong to these prescribed organisations, kaput you're out, ineligible, dead in the water.

On that list are the Care Council for Wales and the Valuation Tribunal for Wales. The two organisations that John Dixon and Aled Roberts the barred  candidates served as members. One would have thought that either the candidates, their agents or their political party would have had  the "Order" as top of their list of essential reading, But it seems not.

The void two, as they will forever be known, were serving members of the bodies and had not resigned by the date of their election. Not reading through that little list looks like costing them their jobs.  

However, the void two did attend and voted for the Presiding Officer, the Deputy Presiding Officer and the First Minister. Better legal minds than mine can debate the validity of these elections in such circumstances.

Be that as it may, the National Assembly is now two Members short of a full pack. So what to do?

The Presiding Officer has sent to the Returning Officers concerned a letter explaining all and asking them to fill the vacancies, but here's the rub, not straight away. They should reflect on a likely Assembly resolution on the matter to be placed before the Assembly in the next few weeks.

Now without the caveat for delay  the Returning Officers could have easily  resolved the matter. The ‘void two’ were on their party list. So all the Returning Officers  need do is declare the next Liberal Democrat candidates on the list as Assembly Members. No costly by-election, simple job done. But no. Party politics raises its head. 

There does some seem to be some reluctance to back the two women that happen to be next on the list namely, the former Assembly Member Eleanor Burnham and Eluned Parrot a former Parliamentary candidate for the party. This reticence is baffling. Surely if the Liberal Democrats had any doubts about either they should never have endorsed them as party candidates. But that, as they say, is up to the internal machinations of the party.

Party politics aside, the National Assembly has a wider responsibility and that is to Welsh democracy. Any hint of a fix between politicians in the Bay to ignore these serious breaches of Assembly election law would make a mockery of the elections. It would have the unsavoury stench of a stitch up. .To push for a vote in the Assembly for candidates that clearly were ineligible at the time of the election would set completely the wrong precedent for the future of our fledgling democracy. 

Let the Returning Officers do their job and let democracy take it’s course. It may be bad luck to the two, but like Benn they'll just have to hang around awhile.

Wednesday, 1 June 2011

Home loans down

A fall in house prices in the next few months are likely with the announcement today by the Bank of England of a record fall in mortgage approvals.

The number of loan approvals for house purchase fell by 4 per cent to 45,166 in April and was lower than the previous six-month average of 46,179.

Remortgages were also down – by 10% to 28,091 in April. The trend is moving down since February. There were 31,201 loans approved in March, and 35,501 in February. The decline since February is a staggering 20.8%.

Of course what the figures don’t indicate are the number of people applying for loans. But with the uncertainty about jobs and large public expenditure cuts it is likely that those that feel confident enough to seek a mortgage are few and far between.

Many would be house owners will look to the rented sector to meet their housing needs, putting more pressure on the social housing sector to meet the housing needs of many young people in Wales.

Labour in its manifesto was pretty vague about its commitment in this area. “We will help deliver the extra homes required to meet increased housing need by making housing a higher priority in the coming decade.” Where's the bacon in that.
No, Huw Lewis, the new housing Minister will need to spell out the numbers. How many new homes are the government going to build, where and by when. The Bank of England figures underline the urgency of the need.

The figures also give a pointer to the rest of the economy. For a depression in the housing market does not give grounds for optimism in the rest of the economy. It would take a brave or foolish man to bet on  growth in Wales in the near future.

Much retail expenditure is home centred and if housing is in the doldrums, the rest of the economy will also have its head in the towel.

Whilst much of the root of the problem lies with Westminster, the Welsh Government can play is part by developing a radical housing policy.

Let us hope that there will be some indication soon that Mr Lewis will move away from the platitudes in his party's manifesto and gets to grip with his new responsibilities. Complacency is not an option.