Wednesday, 23 November 2016

Autumn statement, 2016

Philip Hammond, Chancellor of the Exchequer, has just delivered his first, and last, Autumn Statement to Parliament. Last, because as he announced to a laughing House, future Autumn Statements will actually be Budgets and the Spring Budget will be a Statement.

This is actually a sensible measure. The Budget will be delivered in November and the new rules will then start April next year. So businesses will have a few months to prepare for the changes. The current scheme was invented by Gordon Brown so he could get his face on TV twice a year. It was never a good idea.

Hammond: "Borrow, borrow, borrow."

He spoke for a mere 51 minutes during which he cut taxes (well, froze fuel duty for the seventh year running) and sprayed £23bn of investment money all over the country. The other nations all got raises - Scotland will get £800m more a year (the SNP responded with a stony silence.) Roads, bridges, railways will all get funded. Affordable houses will get built all over the shop; and they will all have ultra-fast internet connections. (Hammond said they will have "5G" connections, but that is a mobile phone standard so he may be slightly confused about the technology.)

The cash unfortunately is going to be borrowed. The government will be borrowing £68bn this year and will continue borrowing at least until the year 2022. The government can no longer forecast when it will stop borrowing. Likely the national debt will be over two trillion by the next election in 2020.

There were some tax rises: insurance premium tax will rise from 10% to 12% and the "salary sacrifice" tax dodge is to be abolished. The triple lock on pensions is good for now but may be lost in the next parliament.

By 2020 the tax free threshold will be £12,500 and the higher rate won't cut in until you're earning £50,000 (currently it's £45,000.)

There will be a new NS&I 3-year bond paying 2.2% with a maximum subscription of £3,000. (Big deal, not!)

Shadow Chancellor replied pointing out that growth was down, investment was down and only borrowing was up. Real wages, he said, have not increased since 2008. He then spent the rest of his time moaning about Brexit.

 McDonnell: "Borrow even more."

To summarise: borrowing continues, austerity continues, but Philip Hammond seems to have a lower-key style about him than previous Chancellors and is less prone to showboating; which must be a good thing.

Monday, 21 November 2016

Frexit one tiny step nearer

The former French President, Nicholas Sarkozy's, ambition to the return to the Elysee Palace in France's general election next year has failed. He has stood down after coming third in the primary voting. This is good news for one Marine Le Pen - leader of the French Front National  - because it means instead of going up against centre-right Sarky she will be up against centrist Francois Fillion. The further to the left her opponent is the more votes she can vacuum up.

That said, Fillion is not very far to the left. He supports tax and spending cuts, a longer working week (up to 39 hours!) a higher retirement age (up to 65!) and opposes adoption by same-sex couples, quelle horreur!

So the alt-right trifecta of Brexit, Trump and Le Pen is on the cards. And Mme Le Pen has promised the French a referendum on membership of the European Union. The French presidential election is about three months away so with a following wind Frexit may have started before Brexit is complete.

Tuesday, 8 November 2016

Their Lordships' opinion is wrong

The judgment of the High Court in the matter of the UK leaving the EU can be read in its entirety here.

The last paragraph is the most significant:

In their prior argument the judges state that leaving the EU will result in British citizens losing certain rights, and only Parliament can take away people's rights. Clearly none of us would want to have a system where the government could cancel your rights by decree.

But the judgment is none-the-less flawed, because Parliament is not the supreme sovereign law-making body: the People are. Parliament derives its authority by being elected by the People and is therefore subordinate to the People collectively.

Their Lordships are wrong because they give no weight to the Will of the People as expressed by Referendum. In voting for Leave the People have voluntarily given up such rights that they may lose in the process (and of course, depending on negotiations they may not actually lose any rights) so the government is not cancelling rights by decree but rather is exercising a power conferred by the referendum.

Some might argue that since the Referendum Act which brought about the referendum does not confer such a power, the power does not exist, but that is to make the same mistake twice. Parliament cannot confer power on itself; nor can it remove power from the People. Once the referendum has happened and the Will of the People expressed, the matter becomes decided and Parliament is bypassed because of its inferior status.

This blog rules that the Secretary of State does have the power to trigger Article 50.

 There are a couple of other interesting points:

1) The Court is the High Court of England and Wales, its judgments do not apply in Scotland. The Secretary of State (for Brexit, David Davis, MP) could still trigger Brexit from Scotland. However the government intends to appeal to the UK Supreme Court - which does cover Scotland. So if they lose there that option goes away.

2) The judgment only binds the Secretary of State; the Prime Minister still has a free hand. However, it not likely she will defy the Court by doing the deed. No, her plan is likely: appeal to the Supreme Court, and if that fails, pass an Act in Parliament, and if that fails - General Election.

Friday, 4 November 2016

Bonfire night is coming

Three High Court judges have listened to a case brought by two South American immigrants and agreed with them that the will of the British people means sufficiently little that parliament must decide if and when Article 50 of the Lisbon Treaty can be triggered by Her Majesty's Government.

This is outrageous for two reasons. First, it was made abundantly clear before the referendum that the result was binding and a Leave vote would be acted on soon afterwards. PM David Cameron said he would trigger Art 50 immediately after the vote, but instead he quit.

Second, who are these people who went to court to trample on the democratically decided will of the British people? Let us look at them first.

Gina Miller: This plaintiff is quite well known in the UK. She is an immigrant from Guyana, South America, a former model who has snagged herself a (white) investment banker husband and is now splashing the cash on expensive court cases. She has said that Brexit made her "feel sick."

Deir Dos Santos: This co-plaintiff is more obscure. He is a hairdresser immigrant from Brazil, but how and when and why he came to the UK is not known. He may not even be a British citizen; there is no requirement to be a British citizen to use the British courts.

So we have two people with no British ancestry attempting to steer the future of our country. They are lauded by a fat-cat human-parasite elite who live the good life on tax-payer cash, either directly, or laundered through the EU.

One could speculate that both the plaintiffs have no real patriotic feelings towards the UK which they regard as a stepping stone into Europe and their dislike of Brexit is not because they think of it as bad for the country, but rather it is bad for them as immigrants.

So far the plaintiffs are winning the case. The High Court judgment is not final though. In December the government will appeal to the Supreme Court. This is one of several possible ways ahead the government could have taken, these being:

  • Ignore the court ruling on the ground that the court had exceeded its powers in dictating to the executive.
  • Put a three line motion to Parliament and so satisfy the court ruling. Rt Hon John Redwood MP has a suggested motion on his blog. He reckons it would pass.
  • Get a whole new Act of Parliament underway. The text of a suggested Act is available here.
  • Appeal to the Supreme Court. This is where we approach fantasy land because if the Supreme Court denies the appeal the government could in theory appeal again to the European Court of Justice.
  • Use another body to trigger Art 50, eg an Order in the Privy Council.
  • Blow up parliament followed by civil war.

PM Theresa May's decision to go the appeal route is correct (at least according to this blog) because had they gone the 'ignore' route there would have been continual legal challenges which would have caused the whole process to grind to a halt.

A 'motion in parliament' may seem quite quick and painless but if it fails to pass then there is a real problem. With parliament is no longer governing according to the will of the people there would have to be a General Election.

A new Act could be blocked in the Lords and would require months for all the readings and to-and-froings between the chambers.

So kicking the can down the road to December 7th, with a judgment in early 2017, seems like the easy way out for now. Of course if SCOTUK (if the Americans can have SCOTUS we can have SCOTUK) rules against the government then the issue blows up again - then we would need the motion in parliament, possibly followed by a General Election.

Incidentally, a General Election would be good for the Conservatives; Labour are in complete disarray so this court ruling could be just the shot in the arm UKIP need to seize a swath of Labour constituencies. We could expect the Tories to increase their majority considerably and many Brexit-friendly MPs to enter parliament.