Friday, August 30, 2024

UK
The government must abandon Tory policies and give people hope

Prem Sikka 

Yesterday
Left Foot Forward

The government is continuing with Tory policies which would deepen despair and push more people into the arms of right-wing extremists.



Next week, the UK parliament returns from its summer recess for a two-week session. The Labour government is likely to face considerable scrutiny of policies which have curtailed its post-election honeymoon.

After 14 years of Conservative rule, erosion of household incomes and public services, Labour won the July 2024 election with a promise of ‘change’ though its election manifesto was light on policy details. Whilst it is too early to reach any definitive conclusions, the concern is that the government is continuing with Tory policies which would deepen despair and push more people into the arms of right-wing extremists.

The early sign of continuing with Tory policies is the retention of the two-child benefit cap, introduced by the Conservative government in 2017. It denies child allowances in universal credit and tax credits worth up to £3,455 per year to third or subsequent children born after April 2017. 450,000 households and 1.6m children are affected by the cap. Some 4.3m children, 30% of all children, live in poverty. Abolishing the cap would cost the government between £2.5bn and £3.6bn in 2024/25. Just £1.7bn would lift 300,000 children out of poverty and reduce poverty for another 700,000 children. This would increase family income and stimulate the local economy too. The government was not persuaded and saw off a rebellion in its own ranks by withdrawing the whip from seven Labour MPs.

The government added fuel to anger by abolishing the universal right for pensioners to receive winter fuel payment (WFP) and deprive 10m of payment of between £100 and £300 to cover higher heating costs in winter. The average state pension is between £9,000 and £9.500 a year, which is less than 50% of the national minimum wage. It is the main or the only source of income for most retirees. Nearly 1.4m pensioners receive mean-tested pension credit, worth £3,900 a year. Some 880,000 eligible pensioners do not claim it because they can’t negotiate the regulatory maze, or lack access to computers. Last year £2.2bn went unclaimed.

Despite benefits and the triple-lock, 2.2m UK retirees live in poverty, 2.5m skip meals and 1.3m are at risk of undernourishment. Last winter, despite WFP there were 5,000 excess pensioner deaths as pensioners could not afford to eat and heat. Each year, around 68,000 senior citizens die in poverty.

This abolition of universal WFP was not in Labour’s election manifesto. It was not preceded by any public consultation or warning and no impact assessment has been produced. “The Social Fund Winter Fuel Payment Regulations 2024” which abolishes the universal right is being introduced as a Statutory Instrument and is expected to come into force on 16thSeptember. The new policy is to means-test the WFP and only pensioners with annual income below £11,336 would be receive it if they can fill a 22 page form and answer 243 questions. Two million more pensioners could be pushed into poverty.

The government claims that the new policy would save £1.4bn a year. Such savings are insignificant as the government is expected to spend some £1,226bn in 2024-25. The £1.4bn saving is doubtful as no mention is made of the costs associated with means-testing and dispute resolution. Due to cold and sickness, more pensioners would need hospital admissions and would increase the cost of healthcare. With erosion of incomes, pensioners would spend less and that would damage the local economies. In any case, successful claim of additional pension credits and related benefits by 880,000 pensioners could cost up to £4bn and wipe out the £1.4bn alleged saving.

The government had a number of policy alternatives. For example, it could have introduced a taper, added WFP to total income so that richer pensioners would pay income tax on it and taxed the rich to raise revenues to retain universal WFP. It ignored all alternatives. The loss of up to £300 of WFP comes at a time when household energy bills are set to rise by 10% or around £150 from October. Since March 2021, tax exempt personal allowance has been frozen at £12,570 a year, and pensioners with modest additional incomes are being hit with income tax. Since 2020-21, the number of pensioners paying income tax has creased by over than 2m, from 6.47mn to 8.51m.

It isn’t just pensioners; low income families are also suffering from high energy bills, and cost-of-living crisis, and deserve support. Some 17.8m adults have annual income of less than £12,570. Despite social security benefits 12m people live in poverty. In England alone, some 13% of households (3.17m) live in fuel poverty. A root cause of this is low wages and corporate profiteering. Last year British Gas announced a ten-fold increase in its profits. BP and Shell have made record profits. Since the pandemic, electricity generation companies have increased their profit margins by 198%. The government’s refusal to tackle profiteering will inevitably erode living standards and cause public disenchantment.

Water is another disaster looming and the government is content to leave this monopoly in private hands, just like Conservatives. Despite inflation-busting hikes in customer bills water companies have a long history of under investing, dumping raw sewage in rivers and seas and not plugging water leaks. Since privatisation in 1989, companies have paid more than £85bn in dividends mostly financed by borrowing of more than £60bn. Now they are struggling to service debt and make the required investment. This week Thames water, the UK’s largest water company, with a debt pile of £18bn urged the regulator to hike household bills by 59% or £228 a year. The companies leading shareholders consider their investment to be almost worthless. Its debt is rated as junk.

Public ownership of water industry is widely supported by the public but that is not what the government wants to do. Instead it has offered some gimmicks such as tighter rules to stop polluters from using four-star ratings to justify high CEO pay. In response to my question in parliament, the Minister ruled out nationalisation by claiming that “It would cost billions of pounds”. When asked to share the government’s calculations, the Minister referred me to a 2018 report by Social Market Foundation, a right-wing think-tank, which estimated the cost of water nationalisation to be £90bn. This included £41-44bn for equity. This report is described by a former government adviser as having “virtually no intellectual substance and the [£90bn] figure was wrong”. He added that the process of renationalisation itself would be “relatively easy, as with the revenues from the water bills, the government would have sufficient income to pay for the assets it acquired”. Of course, no government would buy the debt for £46bn.

The minister provided no reference to any government calculation, alternative source of data or anything more recent. For example, in 2019 Moody’s, a rating agency, considered shareholder equity in water companies to be worth only £14.5bn. Since then, if the state of Thames Water is anything to go by, water company shares have become worthless and debtholders are facing major losses. The government is continuing with Conservative policies, by obfuscation.

Elsewhere, the government is committed to further deregulating the finance industry and reducing capital adequacy requirements. It is seduced by claims that this would somehow release £100bn for investment. It is mistaken. There is no pot of gold sitting in boardrooms that can be emptied. The money is held in assets and capital buffers which would need to be liquidated and would inevitably affect resilience of the industry with deadly consequences. The government is also rolling-back on its commitment to protect workers’ rights which could reduce job insecurity. Chancellor Rachel Reeves has promised employers that government will ‘co-design’ reforms with business.

This week, the public backlash persuaded the Prime Minister to make a statement which remained light on policy details, and there is little relief from Tory policies. The government is planning to raise taxes and cut spending in October budget though the Prime Minister promised that “those with the broadest shoulders should bear the heavier burden”. That hasn’t been evident so far from policies on children and pensioners.

The government is committed to economic growth but it is hard to see how that can be achieved without increasing disposable income of the masses and direct state investment in infrastructure and new industries. The government has boxed itself into a corner with its pre-election pledges of not increasing taxes on the rich and additional borrowing. Such promises are not sustainable. The government must abandon Tory policies and give people hope or risk social disorder and pushing more people into the arms of right-wing extremists.

Prem Sikka is an Emeritus Professor of Accounting at the University of Essex and the University of Sheffield, a Labour member of the House of Lords, and Contributing Editor at Left Foot Forward.
UK
IFS backs Rachel Reeves’s claim that Labour inherited a worse financial situation than expected

Basit Mahmood 
29 August, 2024
Left Foot Forward

So much for the Tories being the party of ‘sound finances’.


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The Institute for Fiscal Studies (IFS) has backed Chancellor Rachel Reeves’ claim that the Labour government inherited a worse financial situation than expected.

Reeves has repeated the claim over recent weeks, saying that the Tories had left a £22bn black hole in the country’s finances for Labour to clean up, meaning that the new Labour government was limited in its spending plans, with less fiscal headroom than previously thought.

Former Chancellor Jeremy Hunt and the Tory press have sought to discredit the claim, however the IFS has now shown that ‘in black and white that there was a black hole in the public finances that was previously unknown’.

To use one example, the Guardian reports that the Home Office repeatedly submitted budget figures under Tory ministers which officials knew understated the ballooning cost of asylum and illegal immigration spending.

The paper reports: “Analysing three years of financial records, the IFS found the Home Office had told parliament at the start of each year it needed an average £110m to cover the UK’s asylum, border, visa and passport operations. However, it ended up spending vastly more: an average of £2.6bn a year.

“The Home Office has got into the bad habit of submitting initial budgets to parliament that it knows to be insufficient, in the expectation of a top-up from the Treasury’s contingency reserve later in the financial year,” it said.

So much for the Tories being the party of ‘sound finances’.

The Director of the IFS, Paul Johnson, has also admitted that when Reeves released her findings from a Treasury audit last month she had uncovered spending that “does genuinely appear to have been unfunded”.

Basit Mahmood is editor of Left Foot Forward
UK
Starmer’s Doom and Gloom Risks Eclipsing Labour Message of Hope

Alex Wickham, Ailbhe Rea and Irina Anghel
Fri, August 30, 2024





(Bloomberg) -- Keir Starmer faces growing doubts among senior Labour politicians about his administration’s gloomy messaging, after calculated interventions bookending the parliamentary recess focused on the UK’s ailing public finances and the tough measures needed to fix them.

Just before Members of Parliament headed into their summer break, Chancellor of the Exchequer Rachel Reeves signaled taxes will have to rise to fill an unexpectedly large fiscal black hole of £22 billion ($29 billion) left by the previous Conservative government. Just 6 days before MPs return, Starmer warned “things will get worse” before they improve, as his administration grapples with the budgetary void. Rounding out a challenging first two months in office for the premier, Britain was hit by days of far-right rioting between the two speeches.

The danger for Starmer is the focus on tough decisions and fiscal rigor risks drowning out the positive message of a party returning to power in a landslide election win after 14 years out of office with a program to improve the lives of working people.

With optimism in short supply, the first rumblings of dissent are already surfacing ahead of Parliament’s return next week. In conversations with Bloomberg, these aides, backbench MPs and ministers — even some in cabinet — questioned whether Downing Street needs to better calibrate its message to highlight plans to turn the country around, rather than risk an overly negative approach that distracts from Labour’s own policies. Otherwise, there’s a danger that the party’s annual conference in three weeks will be dominated by rows about the budget, according to the people, who asked not to be named discussing their private views.

Polling suggests more positivity may be needed. New Gallup data collected during the election and shared with Bloomberg found that Britons were more pessimistic about their economic futures than during the 2009 financial crisis. Some 62% said the economy was getting worse where they lived, compared to just 19% who said it was improving. And a majority of Brits already have a negative view of the new government, according to a YouGov survey released this week.

Starmer is live to the danger.

“This is actually a project of hope,” he told reporters traveling with him to Germany. “But it’s got to start with the hard yards of doing the difficult stuff, of clearing out the rot first.”

Those tough calls are likely to crystallize on Oct. 30, when Reeves delivers her first budget. The doom and gloom camp, as one Labour lawmaker described it, is led by the chancellor, who’s determined to hammer home to the public that she’s been handed a woeful budgetary inheritance by the Tories.

“Many of the same problems that led to the Labour Party’s landslide win in the British election in July are now theirs to solve,” said Benedict Vigers at Gallup.

Reeves’s strategy is seen internally as an extension of the electoral tactics deployed by Starmer’s top aide Morgan McSweeney: a cautious approach to spending and a focus on the political turmoil wrought by the Conservatives. The chancellor views the rhetoric as necessary to show she has no choice but to make unpopular calls, people said.

Starmer is fully signed up to that approach and believes the public want politicians to be up-front with them rather than deploy the false boosterism of former prime minister Boris Johnson, people familiar with his thinking said.

Labour strategists see getting the least popular decisions out of the way early on in the administration as sensible politics. The premier’s allies argue one of his strengths has been choosing a strategy and sticking to it no matter the criticism or distractions, a virtue they see as vindicated by the election win.

“Over the weeks ahead we’ll hear more about not just the tough decisions needed but also the journey the government is embarking on,” Jonathan Ashworth, chief executive of the pro-Starmer Labour Together think tank, said. Starmer could adopt an argument of “prudence for prosperity,” he added.

Others in Labour are unsure. Some lawmakers say Number 10 has given disproportionate airtime to fiscal woes and not enough to conjuring a positive narrative about the government’s first 100 days, from restoring mandatory housing targets and agreeing National Health Service pay deals to unveiling legislation centered around Starmer’s so-called ‘missions’ to improve the country.

There are also concerns that the negativity will only worsen political disillusionment. This argument is seen as an extension of a pre-election clash some MPs had with Starmer and Reeves, who they dubbed the “no machine” for lacking ambition and blocking new policies and spending.

Some early decisions have already proved controversial, and none more so than Reeves’s surprise decision to remove winter fuel payments from pensioners. Some Treasury officials had doubts over the politics of the policy beforehand, but Reeves insisted it was necessary to help balance the books, people familiar with the matter said. But the decision to means-test the benefit landed worse than expected, leading to efforts to mitigate the impact without conducting a full-scale U-turn.

Others describe early evidence of hubris by Downing Street in making a series of quick decisions after winning power without thinking them through. They cite a recent cronyism row involving civil service appointments and a government pass awarded to a donor.

Further policy concerns cited by Labour MPs include Reeves’s orders for departments to find billions of pounds in savings, scrapping a cap on self-funded social care spending without a policy to replace it, and a lack of plans to abolish a policy limiting child benefit to a family’s first two children.

There are also fears among lawmakers that the chancellor may raise taxes that don’t just hit the rich, such as fuel duty, while the biggest concern is she will say she has to implement welfare cuts. Some MPs feel Reeves boxed herself in by promising to keep in place Tory cuts to the national insurance payroll tax, saying she could have avoided a lot of pain elsewhere by reversing them.

One lawmaker said they saw the problem as Starmer letting Reeves run the show on the economy, without the premier having an overarching positive political story to tell.

“Everybody in Britain is willing to sacrifice for a purpose,” said John McTernan, a former adviser to Tony Blair and strategist for BCW Global. “What’s going to get better is the bit that needs to be vividly brought to life.”

Bloomberg Businessweek

Will things get worse like Keir Starmer says?

Ben King - Business reporter, BBC News
Fri, August 30, 2024 

[EPA]

Prime Minister Sir Keir Starmer has warned that "things will get worse before they get better".

He has been hammering home the argument that the Labour Party has taken over from the Conservatives at a time when the government is short of money, and public services such as health and prisons are in a mess.

He is claiming things are worse than he and his party knew before they won the election – so they will have to do things to fix them which they didn’t warn about before people voted.

The Conservatives say that Labour has planned to raise taxes all along.

How did we get to this point?

The PM's speech didn’t spell out exactly what bad news could be coming, but it did warn of a "painful" budget on 30 October.

This is when the government will announce its plans for taxation and spending over the coming year.

The government is definitely short of money. This is partly the result of weak economic growth in recent years, which has meant companies are making lower profits, and people’s earnings are growing more slowly.

That means the taxes the government collects on wages, profits and purchases have also been growing more slowly.

At the same time, an ageing society has placed a greater burden on public services such as the NHS.

The government’s spending watchdog, the Office for Budget Responsibility, has also said that the decision to leave the European Union has slowed economic growth.

But Labour argues that things are even worse than they seemed before the election. The prime minister has warned of a so-called "black hole" in the public finances.

All of the above rhetoric on the state of the economy might be used in attempts to justify any decisions to raise taxes or other measures which were not set out during the election campaign.

What does 'getting worse' actually mean?

In his speech on Tuesday, Sir Keir set out a number of areas where he says the country is not working well such as NHS waiting lists, a lack of capacity in prisons and sewage discharges by water companies.

He is warning that these problems will not be resolved quickly.

But he is also warning that fixing those and other problems will cost money.

That could mean a combination of tax rises and spending cuts. In the prime minister's words, it will be "painful".

However, it is not inevitable that the next Budget has to be, or will be, painful.

Labour's decision to settle industrial action by giving public sector workers pay rises, and to limit the amount of money the government borrows, has increased the pressure on the public finances.

There is also a clear political strategy at work here, with Labour looking to heap as much blame as possible for unpopular decisions on the previous government while they are new in power.

[PA Media]


Is there really a 'black hole' in the public finances?

The phrase "black hole" often appears in discussions about government and money, and it means different things.

In this case, Chancellor Rachel Reeves and the prime minister are talking about a gap between what government departments, such as health and education, expected to spend this year versus what they will actually end up spending.

This gap was first mentioned by Ms Reeves in July, when she said the government was overspending by £22bn - and claimed it had been "covered up" by the Conservatives before the election.

Shadow chancellor Jeremy Hunt has meanwhile accused Ms Reeves of an "utterly bogus attempt to hoodwink the public".

There is a debate about how much of a surprise this was. About £9bn of the £22bn is the cost of increasing public sector pay above the 2% which had been budgeted for - a choice which has been made by this new government.

Paul Johnson, the director of the Institute for Fiscal Studies thinktank, has argued that the need to give higher public sector pay rises could easily have been foreseen.

But other items which make up the £22bn were more genuine surprises, he says, including that it was not clear that reserve money seemingly expected to cover higher spending on the asylum system had already been, in effect, spent elsewhere.

He and other experts have argued that neither Tories nor Labour were straightforward with the public during the election campaign about how bad the public finances were, and what unpopular measures are required to fix it.

How would a government fill a 'black hole'?


Governments faced with a gap between what they plan to spend and what they expect to raise in taxes face a choice.

They could cut spending, raise taxes, or cover the gap by borrowing money, however, the new Labour government has chosen to impose a limit on how much it can continue borrowing.

It says that the total size of the national debt (relative to the size of the economy) has to be projected to fall in five years’ time. This is the same limit as the previous Conservative government set itself under what are known as "fiscal rules".

Fiscal rules are self-imposed by governments in most rich countries to maintain credibility with financial markets.

The government is very close to breaking this rule. Latest figures suggest it is within £9bn of that limit - which is next to nothing given the scale of government spending.

Ms Reeves has very little scope to raise borrowing and stick within this target. So it is likely that she will raise taxes and announce some spending cuts in the forthcoming Budget.

Which taxes will go up?

The chancellor has said more about what taxes will not be going up – that includes the four taxes which raise the most: income tax, National Insurance, VAT, and corporation tax, which are charged on company profits.

Labour promised not to raise taxes on "working people", and that those with the "broadest shoulders" (i.e. wealthy people) should bear the burden.

In ruling out raising the biggest taxes, Labour has limited its room to manoeuvre when it comes to raising more money.

Some tax rises have been announced – such as a decision to charge VAT on private school fees. But the amounts raised would fall short of what will be needed to cover the gap.

Some options which have not been ruled out include increasing taxation of pensions, capital gains (a tax on profits made when a person sells an asset), or inheritance tax.

A number of independent experts have argued that the fiscal rules are not the best way to set out a path for government spending, and that the measures the government has to do to meet them are not necessarily the best decisions.


Labour will ‘take a hammer’ to public services, Flynn to say

Craig Paton, PA Scotland Deputy Political Editor
Fri, August 30, 2024 a



The UK Government will “take a hammer to public services”, the SNP’s Westminster leader is expected to say on Saturday.

Stephen Flynn will address delegates at his party’s conference in Edinburgh, his first major speech to members since losing dozens of MPs in last month’s election.

The Aberdeen South MP is expected to use the speech to criticise the new Government over the economy.

Prime Minister Sir Keir Starmer said the Budget in October will be “painful”, while Chancellor Rachel Reeves claimed the previous Tory government hid a more than £20 billion black hole in public finances.

“You will all know that one of the oldest saying in politics is that you campaign in poetry and govern in prose,” he is expected to tell delegates.

“Labour has gone one step further – campaign in poetry and govern painfully.

“From the poetic promise of change to things can only get worse.

“Taking a hammer to public services seems apt for a toolmaker’s son.”

Mr Flynn will also issue a call to his own party, telling members they “must offer hope in the face of Labour Party austerity cuts and misery”.

“Our argument, our belief and our offer to the Scottish people is that Brexit Britain is not as good as it gets,” he will add.

“We believe that decisions made in Scotland, for Scotland can deliver a better future for all.

“That becoming a normal independent country in Europe can meet our people’s needs and their aspirations.

“That it can deliver the basic belief that the next generation can and should aspire to a higher standard of living and a better quality of life than that which has gone before.

“Those are simple things, but they are the most important of all.”

Scottish Conservative finance spokeswoman Liz Smith MSP, said: “Stephen Flynn is taking the public for fools.

“As the Scottish Fiscal Commission pointed out this week, the SNP is to blame for the mess in Scotland’s finances so they cannot be the solution.

“Despite receiving record block grants from Westminster and imposing the highest taxes in the UK, the SNP have run our public services into the ground and created a huge black hole in Scotland’s finances.

“Yes, Labour have betrayed pensioners by ditching universal winter fuel payments while agreeing above-inflation public sector pay deals – but the SNP have done exactly the same thing in Scotland.”

Scottish Labour deputy leader Jackie Baillie said: “The party responsible for the cuts we are seeing in Scotland right now is the SNP and no amount of spin can hide that.

“The SNP’s cynical and dishonest election campaign was rejected by Scottish voters, but it is still sticking to the same script.

“Labour is working to clean up the mess the Tories left behind and renew our country – including setting up GB Energy here in Scotland, making work pay and prioritising economic growth.

“It’s time for the SNP to stop making excuses and set out how it will fix the mess it has made of Scotland’s public services and public finances.”




He never promised us a rose garden – but Keir Starmer’s ‘doom and gloom’ speech was partisan finger pointing

Peter Bloom, Professor of Management, University of Essex
Thu, August 29, 2024 

In a recent speech, British prime minister Keir Starmer vowed to fix the “rotten foundations” of the country. Addressing an audience of workers and public servants invited to the garden of 10 Downing Street, Starmer positioned his government as one of service, promising to tackle the deep-seated issues plaguing Britain.

“When there is deep rot in the heart of a structure, you can’t just cover it up,” Starmer declared. The message was that Britain needs fundamental change rather than quick fixes.

Starmer painted a grim picture of the state of the nation. He cited a £22 billion black hole in public finances as “the inheritance the last government left us”. Speaking of how he planned to deliver justice following shocking scenes of civil unrest, he drew parallels between the recent riots and those of 2011, arguing that the situation has worsened to the extent that he didn’t know if there was room in prisons to house the people being convicted.

He even suggested, without evidence, that people went out to cause violence because they knew they probably wouldn’t be punished. “They saw the cracks in our society after 14 years of populism and failure – and they exploited them,” he claimed.

Starmer’s diagnosis of Britain’s problems will resonate with many but his approach risks oversimplifying complex issues. By framing the country’s challenges primarily as the result of recent Conservative governance, Starmer overlooks the deeper, more entrenched ideological foundations that have contributed to these problems over decades.

Starmer’s speech was powerful in its imagery of rot and decline but he faces a significant challenge in translating rhetoric into meaningful action. The Labour party’s historical complicity in promoting the neoliberal policies that helped bring the country to its current state cannot be ignored when we talk of “rotten foundations”.

In the 1990s, under the leadership of Tony Blair and Gordon Brown, Labour embraced many aspects of the neoliberal economic model, including privatisation of public services and a light-touch approach to financial regulation. Starmer might want to find a new economic model but is, as of yet, taking little action to bring one to life. The promised Great British Energy and railway nationalisation would barely scratch the surface in terms of reversing decades of privatisation – including in key sectors such as prisons, healthcare and probation.

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The irony of Starmer’s position becomes even more apparent when we consider Labour’s historical role in shaping public perception of economic alternatives. Starting with Blair’s “third way”, Labour has played a significant part in framing critiques of neoliberalism as politically unfeasible and economically irresponsible. Blair’s approach, presented as pragmatic and non-radical, effectively narrowed the scope of acceptable political discourse.

This strategy did yield some short-term gains, yet it simultaneously helped entrench the very “rotten foundations” Starmer now decries. Blair made it difficult for subsequent Labour leaders, including Starmer, to propose fundamental changes without facing accusations of extremism or economic recklessness.

Fiscal rules

Starmer’s task is further complicated by Labour’s recent political strategy. He and his chancellor, Rachel Reeves, bound themselves to restrictive fiscal rules in order to appear “electable”, even in the face of a public crying out for significant change. Now they have hardly any levers to pull to turn things around.

Starmer finds himself in a paradoxical position: railing against a system that his own party helped to normalise and defend. This legacy presents a significant challenge to any genuine attempt at addressing the deep-seated issues in British society and economy.

A partisan approach, while politically expedient, may ultimately hinder progress towards addressing the systemic issues facing the UK. By focusing heavily on the failures of recent Conservative governments, Starmer misses an opportunity to engage in a more nuanced discussion about the structural changes needed to address Britain’s challenges.

A more constructive approach would involve acknowledging the complex interplay of historical, economic and political factors that have led to the current situation. This could include recognising the role of both major parties in shaping economic policies and addressing the limitations of the neoliberal economic model in ensuring equitable growth and social cohesion.

Starmer’s speech does hint at some awareness of these complexities. He speaks of making “unpopular decisions” for the long-term good of the country and warns of short-term pain. However, without a more comprehensive critique of the underlying economic system, these sacrifices risk being seen as merely austerity by another name.

Indeed, given his focus on the social unrest and the failures it exposed in the justice system, Starmer’s speech missed an opportunity to offer the kind of truly progressive vision for criminal justice reform that had been implied by his appointment of James Timpson as a prisons minister.

Instead he packaged up the state of Britain’s prisons with a long list of other problems the Conservatives left him. We learnt that Starmer doesn’t “want” to release prisoners early but had to because of the Conservatives.

Instead of acknowledging the root causes of social unrest, including economic inequality and lack of opportunity, he bundled his response in with warnings of austerity-like measures to come. He risks perpetuating a cycle of social unrest and punitive responses, rather than fostering the transformative change needed to create a more just and equitable society.

His approach to addressing Britain’s “rotten foundations” inadvertently traps him in a narrative of doom and gloom. By embracing a more nuanced critique, beyond partisan finger pointing, that acknowledges Labour’s historical role in shaping these foundations, Starmer could have crafted a more hopeful and forward-looking message. This would not only offer a path for genuine systemic change but also provide a compelling vision for voters.

Starmer’s commitment to addressing Britain’s fundamental problems is commendable, however, his current rhetorical approach risks perpetuating the very partisan divisions he seeks to overcome. The challenge for Starmer and Labour is to find a way to critique the failures of recent governments while also honestly acknowledging their own role in creating these systemic problems.

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Peter Bloom does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.


Starmer’s speech: Labour is now promising misery instead of change

His speech on Tuesday underlined that working class people cannot rely on the Labour government

Keir Starmer’s “change” for the worse will be shouldered by working people
 (Photo: Flickr/ Keir Starmer)

By Isabel Ringrose
Monday 26 August 2024
SOCIALIST WORKER Issue 2920

Keir Starmer—the supposed bringer of “change”—made a speech on Tuesday that life in Britain “is going to get worse”. Not just worse, but “worse than we ever imagined”.

In his first keynote speech, which set out the government’s perspective, Starmer posed as a friend of the people by “being honest” about “the choices we face”.

Starmer wants to seem like a responsible adult, who you can trust to fix the “rot set deep in the heart” of the country at the hands of the Tories.

He is vowing to fix the “rubble and ruin” left by successive Tory governments. And, like chancellor Rachel Reeves, he’s claiming that the Conservatives hid the true financial picture. But who will pay for this rot, rubble and ruin?

The speech was billed as “a direct message to the working people across Britain”. It is cover for Labour to not do all the things it said it would—and do what it said it wouldn’t.

Its first budget is due on 30 October, so the government is scrambling to set the scene about how ordinary people will pay the price for capitalist crisis.

That’s evident in its first broken promise in power—that energy bills will decrease.

Instead energy bills are set to increase by 10 percent in the run-up to winter, equivalent to £12 a month.

That’s thanks to Labour allowing the industry regulator to increase the cap on gas and electricity from October.

Under the new price cap, the average dual-fuel energy bill will rise to £1,717 a year, up £149 from its current level of £1,568 in place since July. The cap is set every quarter by Ofgem.

Ofgem chief executive Jonathan Brearley has put the burden on consumers to “shop around” to keep warm this winter.

The regulator revealed the cap after Reeves set out plans to restrict the winter fuel allowance that helps pensioners pay their bills.

This will no longer be universal to those claiming a state pension and only pensioners on means-tested benefits would qualify this winter. Reeves is trying to close up a “black hole” in the public finances she blames on the Tories. But benefits to pensioners should not be up for grabs.

The allowance is worth between £100 and £300 and paid to 11.4 million pensioners in 8.4 million households in 2022-23 in England and Wales.

Now payments worth £200 will be made to households receiving pension credits, or £300 to households on pension credits paid to someone over 80.

Millions of pensioners will face higher energy costs and colder winters as part of a plan to save £22 billion. But this is at the cost of freezing pensions who have to choose between food and heating—and in some cases won’t be able to choose either.

Starmer’s speech this week demonstrates how these vicious cuts are not the end of the attacks, but the beginning.

There needs to be proper resistance every time the government tries to axe jobs, drop benefits and slash services. It is possible to fight off these attacks but it must start now.
Where is Keir Starmer’s Great British Energy?

The Labour government planned to introduce a state energy company called Great British Energy to lower costs.

It would invest in renewable energy and own, manage and operate clean power projects.

It’s yet to get going. Meanwhile energy secretary Ed Miliband said, “The rise in the price cap is a direct result of the failed energy policy we inherited.

“The only solution to get bills down and greater energy independence is the government’s mission for clean, homegrown power.”

Labour can blame the Tories all it wants, but without regulation on privatised energy bills prices will continue to hike and leave ordinary people with less and less.

And while Labour postures over who to blame, it’s pensioners that will suffer. Simon Francis, coordinator of the End Fuel Poverty Coalition, called it a “cruel decision.”

He said more vulnerable people succumb to health complications from living in cold and damp conditions. He estimates that Labour’s savings will be wiped out by additional strain on the health service.
Fuel cut is ‘reckless’—Age UK

Age UK said that two million pensioners who need the payments will no longer get them.

Caroline Abrahams, Charity Director at Age UK, described the situation as “reckless and wrong”.

“Means-testing Winter Fuel Payment when fuel prices are rising by 10 percent spells disaster for pensioners on low and modest incomes or living in vulnerable circumstances due to ill health,” she said.

pension credit is for people on low incomes and unlocks a number of other benefits. It ensures that single people have an income of at least £218.15 a week, and that pensioner couples have at least £332.

For over a decade about a third of pensioners who are entitled have not claimed it. The result will be colder homes and more death.

In 2020/21, 14,502 people died because of cold homes—a huge change from 2,439 the year before. The number of excess deaths was 4,950 last year.

Gillian Cooper, the director of energy at Citizens Advice, said, “One in four say they could be forced to turn off their heating and hot water this winter.

“We’re particularly concerned about households with children and young people and those on lower incomes, who are most likely to struggle with their heating costs.”

And standing charges—a fixed daily amount that covers the costs of connecting to a supply—are staying the same. These are typically 60p a day for electricity and 31p a day for gas.

These charges are unfair because they make up a disproportionately large part of bills for low energy users.

Plus the regulator is adding £28 to everyone’s bill over the year to cover the cost of dealing with £3.1 billion of debt owed to suppliers.
ABOLISH THE DEATH PENALTY

Texas man is exonerated after spending nearly 34 years in prison for wrongful conviction


KEN MILLER
Updated Thu, August 29, 2024 


Benjamin Spencer who spent 34 years in prison after being wrongfully convicted has been exonerated at the 283rd District Courtroom in Dallas, Thursday Aug. 29, 2024. (Azul Sordo/The Dallas Morning News via AP)

A wrongfully convicted Texas man who spent 34 years in prison for a killing in the 1980s was exonerated Thursday, saying that while he couldn't get those years back, he was happy and moving forward.

“I’m just excited that this day has finally come,” said Benjamin Spencer, 59.

A Dallas County judge granted a motion by the district attorney’s office to dismiss an aggravated robbery charge against Spencer, who was initially convicted of murder in 1987 in the carjacking and death of Jeffrey Young.


“It is a good day,” said defense attorney Cheryl Wattley, who has worked on Spencer’s case for more than 20 years. “I’m trying hard not to cry.”

Wattley praised Dallas County Criminal District Attorney John Creuzot for taking a serious look at the evidence that was discredited in the case.

Creuzot said he was “relieved and humbled to help correct this injustice.”

Prosecution witnesses, including a jailhouse informant seeking leniency, gave false testimony, Creuzot said. He added that prosecutors at the time also failed to provide the defense with evidence that would have excluded Spencer from the crime, including fingerprints.

Spencer, who maintained his innocence, saw the 1987 conviction later overturned. But he was then tried again and convicted and sentenced to life in prison for aggravated robbery of Young.

He was released on bond in 2021 after the district attorney’s office found his constitutional rights were violated and he did not receive a fair trial due to the false witness testimony and withholding of evidence.

The Texas Court of Criminal Appeals overturned his conviction earlier this year, sending the case back to Dallas County.

Assistant District Attorney Cynthia Garza, who leads the office’s Conviction Integrity Unit, said: “There exists no credible or physical evidence that he was in any way involved in this crime.”

Spencer is one of the 60 longest-serving people to be declared innocent, according to data kept by The National Registry of Exonerations.

Under Texas law, he is eligible for a lump sum payment of up to $80,000 for each year he was incarcerated and an annuity, Wattley said.

Wattley said Spencer is trying to live his life honorably and “trying to be an example that others can be inspired by.”



Expiration of major US-China science treaty signals deep uncertainty amid high tensions

South China Morning Post
Fri, August 30, 2024 

A key US-China science and technology treaty has expired with little apparent evidence of progress following a year of delay fuelled by American apprehensions over how China has benefited from the decades-old pact.

Renewal of the US-China Science and Technology Agreement (STA), the first bilateral deal signed between the two countries in 1979, had been postponed twice since August 2023. The most recent six-month extension expired on Tuesday.

A State Department official on Thursday said on background: "I don't have anything additional to share at this time."

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This followed word by the same official a day earlier that the two sides were "in communication" about the STA "including on the necessary guardrails around any such cooperation, strengthened provisions for transparency and scientific-data reciprocity".

"The United States remains committed to advancing and protecting US interests in science and technology," the State Department official added. "We have nothing further to share about the status of the agreement at this time."

On Thursday, the Chinese embassy in Washington did not immediately respond to a request for comment.

In the lead-up to the deadline, the Chinese embassy in Washington told the Post that "China-US cooperation on science and technology is mutually beneficial".

"To my knowledge, the two sides have maintained communication about the renewal," spokesman Liu Pengyu said last Thursday.

Discussion of the treaty coincides with the US presidential race shifting into high gear ahead of the November 5 election.

The race has seen Republicans accuse Democratic presidential nominee, Vice-President Kamala Harris, and her running mate, Minnesota governor Tim Walz, of being too close to Beijing.

Just hours before the pact was about to expire on Tuesday, the Chinese embassy said it would "release related information at [an] appropriate time".

"China and the US side are keeping communication on this," the embassy said late on Tuesday.

Meanwhile, a State Department spokesperson said on background last Friday that the department was negotiating on behalf of the US government to "modernise" the agreement "to reflect the current status of the bilateral relationship".

"We are not prejudging the outcome," the spokesperson.


Jake Sullivan (left), the US national security adviser, meets Chinese President Xi Jinping at the Great Hall of the People in Beijing on Thursday. Photo: Xinhua alt=Jake Sullivan (left), the US national security adviser, meets Chinese President Xi Jinping at the Great Hall of the People in Beijing on Thursday. Photo: Xinhua>

The discussion also comes amid simmering tensions on multiple fronts between the two economic superpowers

This week National Security Adviser Jake Sullivan met in Beijing with President Xi Jinping and Foreign Minister Wang Yi to stabilise bilateral relations tested by their differences over Taiwan, the South China Sea, tariffs and fentanyl.

Originally signed by US President Jimmy Carter and Chinese Premier Deng Xiaoping, the symbolically significant pact has been renewed every five years since it took effect, with the most recent renewal in 2018 under then-president Donald Trump.

After August last year, when it was on the verge of lapsing, the two countries extended it twice, for six months each time, to negotiate renewal terms.

In March, the US House Foreign Affairs Committee unanimously approved a bill to impose greater congressional scrutiny on future State Department efforts to enter, renew or extend any science and technology agreement with China.

For decades, the existing agreement has fostered scientific collaboration by providing American and Chinese researchers financial, legal and political support.

According to the Congressional Research Service, sub-agreements under the STA have encompassed research areas such as agriculture, energy, the environment, nuclear fusion and safety as well as earth, atmospheric, marine sciences and remote sensing.

Its supporters contend the deal shields American researchers working in China and enables research in the US by granting access to crucial Chinese databases, especially in areas like health studies.


Employees at Chang Guang Satellite Technology Co, China's first commercial remote-sensing satellite company, wrap a multilayer heat insulation component on a satellite shell in Changchun, Jilin province, in April. Photo: Xinhua alt=Employees at Chang Guang Satellite Technology Co, China's first commercial remote-sensing satellite company, wrap a multilayer heat insulation component on a satellite shell in Changchun, Jilin province, in April. Photo: Xinhua>

But critics say China's state supervision and control over local science and technology projects have allowed Beijing to exploit the STA.

They claim Beijing can address scientific gaps, hone skills and capitalise on America's decentralised academic landscape to predominate in sectors like electric vehicles and renewable energy.

In June, the House select committee on China asked the Commerce department to provide information "to assess the damage already caused to US national security" caused by the STA.

"We believe the US-PRC STA is a vector to give the PRC access to US dual-use research and presents a clear national security risk," Republican lawmakers said in a letter. "The Biden administration must stop fuelling our own destruction and allow the STA to expire."

The agreement's protracted renewal process after decades of uncontroversial renewals highlighted the complex new issues that have come between the two sides, according to Denis Simon of the Asian Pacific Studies Institute at Duke University.

"Many of the central issues being discussed were simply not issues in 1979, such as data security and personal security," said Simon.

"The old STA had become almost obsolete, so renewal shifted to devising a new agreement that was more up to date and reflected the realities of 2024 and not the situation 40 years ago."

On Thursday, the US deputy assistant secretary for science and space at the State Department co-chaired a meeting with Japan's ambassador for science and technology cooperation.

They reviewed progress on cooperation in areas such as quantum, fusion and artificial intelligence and strengthened collaboration in emerging technologies including high-performance computing, according to the State Department.

Copyright (c) 2024. South China Morning Post Publishers Ltd. All rights reserved.
Borrell asks EU to consider sanctions on 2 Israeli ministers

Reuters
Updated Thu, August 29, 2024 

EU High Representative for Foreign Affairs and Security Policy Borrell speaks during a press conference in Hanoi

BRUSSELS (Reuters) - European Union foreign policy chief Josep Borrell said on Thursday he has asked the bloc's members to consider imposing sanctions on two Israeli ministers for "hate messages" against Palestinians, messages that he said broke international law.

He did not name either of the ministers. But in recent weeks he has publicly criticised Security Minister Itamar Ben-Gvir and Finance Minister Bezalel Smotrich for statements he has described as "sinister" and "an incitement to war crimes".

Borrell said EU foreign ministers held an initial discussion about his proposal at a meeting in Brussels on Thursday. He said there was no unanimity - which would be required to impose sanctions - but the debate would continue.

"The ministers will decide. It's up to them, as always. But the process has been launched," he told reporters.

He said he had proposed that the Israeli ministers be sanctioned for violations of human rights. EU sanctions generally mean a ban on travel to the bloc and a freeze on assets held in the EU.

Israel's foreign minister Israel Katz accused Borrell of targeting him with false claims that he had called for Palestinians to be displaced from the West Bank. "I oppose the displacement of any population from their homes," he said.

Diplomats say it is unlikely the EU would find the necessary unanimous agreement among its 27 members to impose sanctions on Israeli government ministers.

But Borrell's decision to float such a proposal indicates the level of anger among some European officials over the words and actions of some far-right Israeli ministers.

Even ministers from some countries that are strong allies of Israel, such as Germany and the Czech Republic, did not immediately shut down the sanctions discussion in comments to reporters on the sidelines of Thursday's meeting.

Ireland, one of the EU's most pro-Palestinian members, said it backed Borrell's suggestion.

"We will be supporting Josep Borrell's recommendation for sanctions in respect of settler organisations in the West Bank who are facilitating (the) expansion of settlements, and also to Israeli ministers," Irish Foreign Minister Micheal Martin said.

But Italian Foreign Minister Antonio Tajani dismissed the idea.

"We have to resolve the problems, convince the Israelis to make the choices that will lead to a ceasefire in Gaza," he said. "This is the real priority."

(Reporting by Charlotte Van Campenhout and Andrew Gray; Additional reporting by Maytaal Angel; Editing by David Gregorio)

Borrell says EU should consider sanctions on Israeli ministers over Gaza war remarks

Euronews
Thu, August 29, 2024 

The EU's foreign policy chief has said the bloc should consider imposing sanctions on some government ministers in Israel over their remarks about the war in Gaza.

Josep Borrell said some members of the Israeli cabinet, who he didn't name, had released "hateful messages" and proposed things which "clearly go against international law".

"I think that the European Union has not to have taboos in order to use our toolbox in order to make humanitarian law respected. But it's not my decision. I only have the capacity of proposal. Member States will decide," he said to reporters in Brussels after chairing a meeting of EU foreign ministers


But the 27 EU member countries are divided over their approach to the war in Gaza and it’s unlikely that all would all agree on such a move.

There has already been pushback to the suggestion from Italy's foreign minister, Antonio Tajani, who called it "unrealistic".

"We must try to solve the problems by convincing Israel to make choices that lead to a ceasefire in Gaza, because this is the real priority. It is not with the recognition of theoretical Palestine, with sanctions on Israeli ministers, that the problem will be solved. We need more diplomacy, we also need strong messages," he said.

"But I believe that this is not the right way to convince Israel to conclude an agreement with the other parties in Cairo."

Polio vaccination campaign


Those comments come after the World Health Organization announced that Israel had agreed to limited pauses in fighting in Gaza to allow the health body to oversee a polio vaccination rollout for hundreds of thousands of children after a baby contracted the first confirmed case in 25 years in the Palestinian territory.

Described as "humanitarian pauses" that will last three days in different areas of the territory, the vaccination campaign will start on Sunday in central Gaza and will be run together with UNICEF, UNRWA and local partners.

Palestinians displaced by the Israeli offensive in Gaza walk past sewage flowing into the streets of Khan Younis, July 4, 2024 - Jehad Alshrafi/AP Photo

"I think this is a way forward. I'm not going to say this is the ideal way forward, but this is a workable way forward. Not doing anything would be really bad, we have to stop this transmission in Gaza and we have to avoid the transmission outside, outside Gaza,” said Rik Peeperkorn, the WHO representative in the Palestinian territories.

Peeperkorn said the health body aims to vaccinate 640,000 children under 10 and that the campaign has been coordinated with Israeli authorities.

"We know that with these type of polio outbreaks, the circulating vaccine derived polio virus type two that you will need to vaccinate at least 90% of children to stop the transmission. And that's where we are so focused on. So if we under vaccinate, you know, we are not stopping the transmission."

EU urged to rethink ties with Israel over Gaza and impose sanctions against some ministers

Lorne Cook
Thu, August 29, 2024 








The Associated Press


BRUSSELS (AP) — The European Union must rethink its relations with Israel as the death toll mounts in Gaza and the West Bank and impose sanctions on some Israeli government ministers accused of fomenting racial hatred, Ireland and the bloc’s top diplomat said Thursday.

At a meeting of EU foreign ministers in Brussels, Ireland’s foreign minister accused Israel of deliberately targeting civilians as well as Hamas militants with the military campaign it launched almost 11 months ago.

“This is a war against Palestinians not just against Hamas. The level of civilian casualties and dead is unconscionable,” Micheal Martin told reporters. “It’s a war on the population. No point in trying to fudge this.”


Israel’s offensive in Gaza has killed over 40,000 people, according to local health officials, displaced 90% of the population and destroyed its main cities. Hamas has lost thousands of fighters and much of its militant infrastructure.

Violence has also surged in the West Bank since Hamas’ Oct. 7 attack inside southern Israel ignited the war there. Israel launched a large-scale operation in the West Bank this week, in which Hamas said 10 of its fighters were killed in different locations.

Martin said a legal opinion issued by the International Court of Justice that Israel’s occupation of Gaza and the West Bank is unlawful obliges the EU to take action. The Palestinians have hailed it as “a watershed moment for Palestine, for justice and for international law.”

“It cannot be business as usual,” Martin told reporters. “It is very clear to us that international humanitarian law has been broken.”

Ties between the EU and Israel — which are major trading partners — are governed by a so-called Association Agreement. Ireland and Spain have been pressing their EU partners to examine whether Israel has broken the rules.

The EU is the world’s top provider of aid to the Palestinians but holds little leverage over Israel, notably because the 27 member countries are deeply divided in their approach.

Austria, Germany and Hungary are staunch backers of Israel, while Ireland and Spain are more vocal in their support for the Palestinians. Nonetheless, the bloc does have credibility as a European project founded on peace.

EU foreign policy chief Josep Borrell, with the backing of Ireland, urged the ministers to consider imposing sanctions on certain members of Prime Minister Benjamin Netanyahu’s right-wing Cabinet over their remarks about the war in Gaza.

“Some Israeli ministers have been launching hateful messages, unacceptable hateful messages, against the Palestinians and proposing things that go clearly against international law and is an (incitement) to commit more crimes,” Borrell said.

Borrell did not name the ministers, but earlier this month he criticized Israel's Finance Minister Bezalel Smotrich for suggesting that the starvation of Gaza’s population of more than 2 million people “might be just and moral” until hostages captured in the Oct. 7 attack are returned home.

Borrell said there should be “no taboos” to prevent the EU from ensuring that international humanitarian law is respected.

German Foreign Minister Annalena Baerbock did not take a clear stand either way, saying only that things should be examined carefully on a case-by-case basis to assess “what are the allegations? Are these allegations enough to list to sanction?”

She underlined that any decision to impose sanctions would require unanimous support.

After the meeting, Borrell conceded that the move did not receive unanimous backing, but he said that he has launched the technical work required to impose sanctions, should the EU finally agree. “The ministers will decide, it’s up to them as always, but the process has been launched,” he told reporters.

Borrell also said he is preparing a high-level meeting on the war at the U.N. General Assembly next month, and that Arab countries and the United States have said they will take part. He said that Israel is welcome to attend.

Lorne Cook, The Associated Press