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Archive for the ‘Economy’ Category

Tuesday
Jan 15,2013

This will not be news to those of you who are avid readers of China’s People’s Daily. However, an article in that paper on 4th January spelt out baldly what I have been saying for some time: Chinese interests are steadily buying up a controlling stake in Britain’s critical national infrastructure.

The article says:
“China’s investment in the United Kingdom will continue its “explosive” growth, with high-end manufacturing and infrastructure leading the way, a senior diplomat predicted.

“The UK is the most open economy, and also the most market-oriented,” in Europe, said Zhou Xiaoming, minister counselor of the Chinese embassy in the UK.

Chinese companies have been answering the call from some members of the European Union for capital.

In 2011, the UK was the third-largest EU destination for Chinese investment, following Luxembourg and France, according to the Ministry of Commerce.

China’s overseas direct investment in the UK in 2011 was $2.5 billion, it said.

But Zhou said the real figure was far more as Chinese overall investment in the UK experienced “explosive” growth.

“It is estimated that the Chinese capital that flew into the country in 2011 reached $6.5 billion,” said Zhou.”

Am I alone in thinking that any sensible nation state should be concerned that control over its critical infrastructure is steadily being bought up by another country?

There is no debate about it and the Government seems at best to be complacently ignoring it or more sinisterly tacitly encouraging the sell off.

Saturday
Jan 12,2013

Nicholas Watt in today’s Guardian has a fascinating insight into the dilemma facing David Cameron as he contemplates what he will say in his long-awaited speech on Europe or whether he can put it off yet again:

“Over the Christmas break William Hague dusted off a sacred text that has served as the lodestar for British Eurosceptics over the last quarter of a century: Margaret Thatcher’s Bruges speech of 1988.

The foreign secretary thought that in preparation for David Cameron’s most important speech on Europe later this month, it would be wise to remind himself how Thatcher memorably set herself against a “European super-state exercising a new dominance from Brussels”.

As officials and ministers chewed over Thatcher’s speech they reached a rather startling conclusion. Were Cameron to deliver such a “pinko and pro-European” speech, in the words of one source, at least 25 anti-EU Conservative MPs would walk out of the party.

Eurosceptics often forget that Thatcher balanced her warnings of the dangers of a European super-state with a staunch defence of Britain’s place at the heart of the EU. “Britain does not dream of some cosy, isolated existence on the fringes of the European community,” she said. “Our destiny is in Europe, as part of the community.””

The real problem for Cameron is that there is now such a gap between what any sensible British Prime Minister might say about the country’s relationship with our European allies and partners and what the backbenchers on whom he has to rely believe. In practice, the gulf is unbridgeable. A fantasy that is rooted in a century-old vision of the United Kingdom as a world power straddling the Atlantic with a political and economic empire stretching round the globe is frankly incompatible with the realities of the twenty-first century.

It would be tempting to sit back and watch the fireworks as the Tory (and Coalition) meltdown unfolds, but the consequences for the country’s future are really too serious for that.

Sunday
Nov 4,2012

Over the last few years, I have repeatedly expressed concern about the potential importance of the threat of an electro-magnetic pulse that could disable or destroy electronic installations.  Such a pulse could come from an errant solar flare or other extreme space weather or it could be produced by a nuclear warhead exploded in the upper atmosphere.  Both could have devastating impacts on ground-based electronic equipment and on electric power grids.

Now comes news of a weapon that could be carried in a cruise missile that can be programmed to disable the electronic systems in individual buildings.  Apparently, the U.S. Air Force and its contractor Boeing, along with Raytheon, have created the High-powered Microwave Advanced Missile Project, or CHAMP, which was just tested over a Utah desert.

The cruise missile, which was launched from a U.S. bomber, was pre-programmed to fly over a target and shoot a burst of high power microwaves at a two-story building. It knocked out rows of personal computers and electrical systems which were shown in a video taken of the test.

Following the first target, the cruise missile then was guided to six other targets, resulting in knocking out all electronics.

Even if this was a US initiative, it sounds as though more effort needs to go into protecting UK infrastructure and critical systems against such attacks – which is more or less what I was saying about three and a half years ago.

Tuesday
Oct 2,2012

Ed Miliband’s brilliant bravura performance this afternoon at the Labour Party Conference – seventy minutes without a note (beat that Cameron) – proves that the Labour Party is six months ahead of the schedule necessary to prepare for the next General Election.

Before then, the Labour Party needs to articulate the philosophical themes that will underpin the next Labour Government and crystallise those down to a (small) number of symbolic policy commitments.

The next General Election is in May 2015 – two and a half years away. The equivalent point before Labour’s 1997 General Election landslide was the Labour Party Conference in 1994.  That was the Party Conference when Tony Blair in his Leader’s speech proposed that the content and wording of Clause Four be reviewed and reformulated for new times and New Labour.

The themes which underpinned Labour’s 1997 election manifesto (“The future not the past”; “The many not the few” etc) were not fully articulated until the new Clause Four was approved in the Spring of 1995 – two years before the Election.  And the policy commitments (The Pledge Card”) were not finalised until July 1996 – ten months before the Election.

And today Ed Miliband set out the philosophical basis on which “One Nation Labour” will appeal to the electorate in 2015.  The themes he set out today will resonate, not only with the Labour Party in the hall in Manchester and amongst Labour supporters across the country, but they will strike a chord amongst the rest of the public who can see how Cameron’s Government is out-of-touch and leading the country further and further into an economic quagmire, whilst dividing a nation and a people who will only flourish when united.

Tuesday
Aug 28,2012

No doubt I will be told that I don’t understand the nuances of American politics, but I can’t help feeling that Tropical Storm Isaac’s disruption of the Republican Party Convention at Tampa in Florida is not the problem for Mitt Romney’s strategists that they are suggesting it is.

Conventional wisdom is it that a Presidential candidate – particularly one that is already securely nominated – gains a political boost from his Party’s Convention and the TV exposure that it brings.  In this case, the Republican Party was hoping to relaunch/repackage their Presidential candidate and demonstrate to/bamboozle an excited American electorate that  Mitt Romney was Presidential in timbre, had the vision thing, and was an-all-round nice decent guy (oh and that his Mormonism is OK really).

Now that some of the Convention has already had to be cancelled because of Tropical Storm Isaac this plan is in disarray.

However, the Tea Party wing of the Republican Party is also determined to use the Convention to write into the Party’s platform their particularly weird mix of ideology, including such gems as:

  • no exemptions on abortion being illegal for rape or incest, or where the mother’s life is at risk;
  • no legal recognition of same-sex couples including civil unions;
  • tough immigration laws, including a huge Berlin-style wall along the USA/Mexico border;
  • a return to the Gold standard and a ban on any tax increases, except for war and national emergencies; and
  • the elimination of the Environmental Protection Agency and a big increase in the use of fossil fuels.

This, of course, would be on top of Mitt Romney’s own platform of massive tax cuts for the wealthiest and tax increases for other Americans (sounds familiar).

Maybe I am naive but wouldn’t TV exposure of all this stuff strengthen the Democrats?

So perhaps Tropical Storm Isaac is actually a boon to the Republican Party and will in fact boost the chances of the rest of the world having to come to terms with President Romney in a few months time.

Monday
Jul 23,2012

The House of Lords, unlike the House of Commons, is still sitting and this afternoon Baroness Jan Royall, Leader of the Opposition, asked a Private Notice Question of the Leader of the House, Lord Strathclyde, about the position of the Trade Minister, Lord Green of Hurstpierpoint.

 

As the Daily Telegraph has pointed out, allegations that HSBC, while Lord Green was its Chairman, allowed money laundering on a huge scale to take place are now casting a cloud over his current role as a Trade Minister.  Their report says:

 

“The US Senate has launched a coruscating attack on HSBC for its slapdash approach to money-laundering regulations. The bank could face a $1 billion fine.

 

According to Senator Carl Levin, chairman of the US Senate Permanent Subcommittee on Investigations, “the culture at HSBC was pervasively polluted for a long time.” Just how polluted was revealed in the Senate report into the scandal. For example, between 2007 and 2008, HSBC’s Mexican operations moved $7bn into the bank’s US operations. According to the report, both Mexican and US authorities warned HSBC that the amount of money could only have reached such a level if it was tied to illegal narcotics proceeds.”

 

The Government’s answer boils down to saying that there is nothing that casts doubt on Lord Green’s integrity and that there is no reason that he should be held responsible for everything that the organisation of which he was chairman was doing.

 

However, what was he doing as Chairman of the Bank during this time? If the Bank were warned by both the Mexican and US authorities that transactions of $7 billion were tied to the illegal drugs trade, shouldn’t he have been told of the warnings.  If he wasn’t, why wasn’t he and what sort of system of corporate governance was he presiding over if it was not felt that such warnings should be conveyed to the Board? Is $7 billion too small a sum for him to worry about?  And if he was told, what did he do about it?

 

I tried unsuccessfully to get in and put a this question to the Leader of the House:

 

“How bad does the stench of money laundering have to be around its Trade Minister before it impacts on the reputation of the United Kingdom?  And why – if his integrity is as great as we are told it is – are they so reluctant to have him come to the House and dispel that stench by setting the record straight?”

 

The BBC captures the full exchange here and the Hansard test is as follows:

HSBC

Private Notice Question

3.07 pm

Tabled By

To ask Her Majesty’s Government what assessment they have made of the impact of the allegations about HSBC made by the Permanent Subcommittee on Investigations of the United States Senate Committee on Homeland Security and Governmental Affairs on the ability of Lord Green of Hurstpierpoint to fulfil his ministerial duties.

Baroness Royall of Blaisdon:My Lords, I beg leave to ask a Question of which I have given private notice.

The Chancellor of the Duchy of Lancaster (Lord Strathclyde):My Lords, Her Majesty’s Government have every confidence in my noble friend Lord Green’s ability to fulfil his ministerial duties. His experience, expertise and enthusiasm provide great benefit to the UK’s international profile and to the support that UK Trade and Investment provides to British businesses.

Baroness Royall of Blaisdon:My Lords, I am grateful to the Leader of the House for that Answer. However, as the noble Lord will be aware, questions have been asked about the present ministerial role of the noble Lord, Lord Green, following the US Senate committee’s findings.

Paragraph 1.2 of the Ministerial Code, which sets out the responsibility of Ministers to Parliament, says that:

“Ministers should be as open as possible with Parliament and the public, refusing to provide information only when disclosure would not be in the public interest”.

Given that obligation, will the Leader of the House ask the noble Lord, Lord Green of Hurstpierpoint, to come to your Lordships’ House to place on record what he knew and when about the matters investigated by the US Senate committee, including what steps he took to deal with them? Would such a move not give the noble Lord, Lord Green, the opportunity to dispel once and for all the questions being asked about his present ministerial role?

Lord Strathclyde:My Lords, I congratulate the Leader of the Opposition. I know that she has been trying to find a PNQ to put to the House and she has managed to do so. I am very glad to be able to respond on behalf of Her Majesty’s Government.

There is no urgency in this matter. The investigation started more than two years ago. The report in question was published two weeks ago. There was no evidence of personal wrongdoing of my noble friend; indeed, there was no personal criticism whatever of my noble friend. The investigation is ongoing. As for ministerial accountability, my noble friend Lord Green is accountable to this House—to Parliament—for the work he does as a Minister. However, many Ministers have had previous careers. No Minister needs to be accountable to Parliament for their previous career, only for what they are doing as a Minister.

Lord Butler of Brockwell:My Lords, I declare an interest as a non-executive director of HSBC during the time when the noble Lord, Lord Green, was chief executive officer and chairman. Is the Leader aware that when I was advising the Prime Minister on calls for ministerial resignations, I drew a distinction—which I think is widely accepted—between accountability and responsibility? While it may be the case that the chairman and chief executive officer of a major international company is accountable for everything that happens in that company, there is no possible way in which they can be responsible for everything that happens in a worldwide group of the size of HSBC.

Lord Strathclyde:My Lords, with all his experience and knowledge—not just as head of the Civil Service and Cabinet Secretary but having had a more commercial career since he left—the noble Lord, Lord Butler of Brockwell, has brought a lot of wisdom and good sense to this debate, on which we should all reflect.

Lord Kinnock:My Lords, since the Leader of the House has told us that the work of the noble Lord, Lord Green, is of benefit to the United Kingdom’s profile—the words he just used—does he think that the accountability of an individual in a very senior position in Government or business ceases when that individual changes post? Does he not think that it would benefit the UK’s profile to ensure that a Minister rigorously adheres to the wording of the Ministerial Code, as just spelt out by my noble friend? Further, does he not think that the ethics of business require that a Minister who has the opportunity and the right to come to this House to explain themselves should do so?

Lord Strathclyde:My Lords, I do not disagree at all with what the noble Lord says about the ethics of the industry in which my noble friend was involved. In fact, only last week, this House set up a special Joint Select Committee to look at ethics and many other practices in the banking industry. Surely that is the point. If a Select Committee of this House or another place wishes to ask my noble friend questions, it should do so. My purpose is to reflect on my noble friend’s role in government and to answer on behalf of Her Majesty’s Government.

Lord Cormack:My Lords, does my noble friend agree that anyone who knows the noble Lord, Lord Green, could not doubt his total integrity for a moment?

Lord Strathclyde:My Lords, I agree with that but I wholly accept that questions need to be asked—and are habitually asked—of a Minister to make sure that he is accountable to Parliament. As I said in my reply to the noble Lord, Lord Kinnock, if a committee of Parliament wishes to put questions to my noble friend, it is entirely free to do so.

Lord Grocott:My Lords, perhaps I can remind the Leader of the House of a report with which he will be, no doubt, almost word perfect: the report of the Leader’s Group on Working Practices, which made a number of recommendations. Of course, the group was established by the Leader for the Leader. Recommendation 3 of that report—which, I remind him again, was published more than a year ago in April last year—said:

“We … recommend that there should be a monthly question time dedicated to questions on House of Lords matters addressed to the Leader of the House”.

Perhaps I may helpfully suggest that both today’s Question and indeed the very important one raised last week by my noble friend Lord Barnett could be handled were the Leader to accept that simple, unanimous recommendation by a committee that was set up at his instigation. I urge him to act on that recommendation as soon as possible.

Lord Strathclyde:My Lords, from memory, I do not think that there has been a single Question put to me in my capacity as Leader of the House in the past 12 months. That rather leads me to believe that there is no great demand for a monthly Question Time session for the Leader. There are perfectly good methods for asking me questions and noble Lords should use them if they wish to.

Lord Hughes of Woodside:My Lords, from a rather different view, perhaps, I query what was said by the noble Lord, Lord Butler. Surely accountability and responsibility cannot simply be divided one from the other—it is not as sharp as that. Accountability and responsibility go hand in hand and no one should doubt it.

Lord Strathclyde:My Lords, my noble friend Lord Cormack said that no one should challenge the integrity of my noble friend Lord Green, and I agree with him. But if it comes to a choice between the noble Lord’s view of what is responsibility and accountability and that of the noble Lord, Lord Butler of Brockwell, I will go with the noble Lord, Lord Butler of Brockwell.

Baroness McIntosh of Hudnall:My Lords, I personally—along with most of the House, I feel—am in no position and would not wish to challenge the integrity of the noble Lord, Lord Green. However, does the Leader of the House agree that perhaps there would be less question about his conduct over the issue of HSBC were the House to see him more often answering questions that relate to his ministerial responsibilities? It may have something to do with his relative unfamiliarity to Members of the House that they are perhaps more sceptical than they should be.

Lord Strathclyde:My Lords, as a Minister for trade, my noble friend of course spends a great deal of time overseas. Since he was appointed, he has travelled to 42 countries and visited 73 cities. In his role as Minister of State for Trade and Investment, he has answered a total of 72 Parliamentary Questions, including two Oral Questions out of three that he could have answered. The response to the point raised by the noble Baroness is that if more Questions on trade and investment were put down, I am sure that my noble friend would be very happy to come and answer them.

Baroness Royall of Blaisdon:My Lords, I thank the noble Lord for his answers, but perhaps I may say that I found his initial response to my Question slightly patronising, albeit not in terms of the substance. I table PNQs when I believe that there is a matter of accountability which is of interest to this Parliament as a whole—we are the only House of Parliament sitting at the moment—and when I believe that it is of importance to this nation. I do not do so for personal gratification.

Lord Strathclyde:My Lords, if the noble Baroness felt that I was in any way seeking to patronise her, I apologise fully.

 

 

 

Wednesday
Jul 11,2012

The Joint Committee on the National Security Strategy (of which I am a member) has just published a report criticising the Government for failing to take seriously the concerns that it expresses in its First Review of the Strategy.

In particular, the report points out that the Government has failed to respond adequately to the Committee’s concerns about the implications for the National Security Strategy of major shifts in US strategy, of the Eurozone crisis and the potential impact of Scottish independence.

The Joint Committee had urged the Government to press ahead with planning the next national Security Strategy, allowing sufficient time to involve academics and experts external to the Government in the process and to allow the next Comprehensive Spending Review and the Strategic Defence Review to be properly integrated in the process. The 2010 National Security Strategy was rushed and weaker as a result.

The Government has acknowledged that it is “important to start thinking about the work plan” for the next National Security Strategy “well in advance of 2015”.  However, there is no indication that any effort has been made to start drawing up plans to ensure that the next Strategy is a more candid and more explicit document that properly addresses difficult questions.

Even more disturbing is the absence from the Government of any indication that it intends to draw up the next Strategy in a way that achieves a broad national consensus on the foundations necessary to plan for our nation’s security in the longer -term.

Failure to build such a consensus will be a wasted opportunity – without such a consensus any future Strategy will not have abroad enough basis of buy-in and consent and that in turn will weaken the Strategy and also National Security itself.

 

Monday
Jul 2,2012

The Department of Health has recently announced a list of Non-Executive Members of the National Health Service Commissioning Board, the biggest quango in Europe through which most of the money going to the NHS passes.

And – in their wisdom (that’s meant to be irony) they have appointed Mr Naguib Kheraj, the current Vice Chairman of Barclays Bank plc. More significantly he was Finance Director of the Bank until 2007 – so he was in charge of the finances of the Bank when the attempted fixing of the LIBOR market was going on.

Just the sort of person we can have confidence in to oversee the running of our National Health Service.

Only this Government ……

 

Nahuib Kheraj

 Banker
Tuesday
Jun 26,2012

My good friends at The Risk Management Group have produced “The A to Z of Safe Social Media” (a sister guide to their earlier “The A to Z of Safe Children Online”.  It is available for free download here and even contains a foreword from me!

Saturday
Jun 16,2012

Much as I enjoyed all the “tainted Prime Minister” stuff in Ed Miliband’s speech this morning to the Labour Party National Policy Forum,  I was struck by the enthusiasm with which he spoke about local government and the contribution being made by Labour councillors:

“Labour Birmingham.  Labour, in whom the people of Birmingham placed their trust in May.  A Labour council changing the way we do politics with a manifesto built on 12 months of conversations with the people of this city.  A Labour council improving our society with 5,000 new homes a year.  And a Labour council changing our economy by paying at least £7.20 to every city council worker.  A decent living wage.

And let us recognise the work of every Labour council making a difference in tough times.  Liverpool’s new Mayor Joe Anderson and h is council that is building 2,500 homes.  Manchester keeping open its Sure Start Centres.  And Newham, standing up for tenants against unscrupulous landlords.

Labour councils whose examples will inspire our next manifesto.  And let us applaud them for their work.”

Here at last is a recognition that Labour local government can be in the vanguard of delivering effective public services that meet the needs of their communities, that Labour local government is not something to be apologised for but is Labour’s future, and that the platform for winning future General Elections will be found at local level.