The more I read about the economic disaster in Greece, the more I wish they would let them out of the currency straight jacket that is part of the problem.

           Greece has five main economic troubles. Its government has borrowed too much in the past, and wishes to carry on borrowing too much. The economy is declining year after year, as austerity bites with no currency depreciation or easier money to offer some relief. The balance of payments remain out of balance and difficult to finance, as Greece is not competitive with the more successful north of the Euro zone. Greece is mired in high unemployment, increasing its deficit and depressing its tax revenues. The banking system is weak. People afraid of the future are taking money out of Greece to put it into safer havens, doing more damage to activity in Greece.

           The official answer to all this is to raise taxes and cut public spending.  The aim is to cut the deficit, hoping  that the …

           In the later months in opposition, when I and other economically minded Conservatives were giving advice to Shadow Ministers, we were often told that our tunes would change a year or two  into government. Wise Shadow Ministers knowingly explained to us that we might accept the  necessity of spending cuts in opposition,  but it would be very different in government. You will, they said, be demanding that we cut less and spare the spending. They expected our brave words to vanish like the melting snow.

             We are fast approaching the two year mark of the government. What is fascinating is that the position is the very opposite of that predicted by some Shadow Ministers. Many backbench Conservatives are uneasy about public spending, but for the opposite reason. There are a variety of areas where the backbenchers want it cut, where Ministers refuse to co-operate.

            Last week-end the unhappiness about taxpayers financing energy subsidies came to the fore. Most Conservatives would like the market to be allowed …

       Yesterday I rang the Leader of Wokingham Borough Council to check they had all they needed from central government and were able to keep the main roads gritted and open. I was happy to learn that they planned a couple of gritting runs on the main roads.

        I got up early this morning to see if all had worked well, and was pleased to find the main local roads were well salted and gritted and running smoothly. Many  thanks to all those who drove the lorries to make sure the rest of us can still get around, and thanks to the Council for organising it.

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         The only area of public spending which was cut overall in the first two years of this government was capital projects. The Coalition inherited large forecast cuts in capital from Labour. They abated the cuts a bit, but carried on with the main thrust of them. It has been a bone of contention ever since. The construction industry is not happy. Business lobbies generally have complained about the poor state of our infrastructure. The public sector has made enquiries of Ministers to see if the cuts can be reduced more.

      The government has responded to the pressures. It has not merely found a bit more public money for capital. It has also spoken up about the need to finance more of these items in the private sector. It is working on a scheme to promote more direct pension fund investment in UK infrastructure. It has itself put a lot of political capital into promoting high speed rail, though these plans do not entail any construction work before …

      Yesterday I called in at the consultation on the construction of new homes in Shinfield.

        I raised several issues with the representatives of the developers. These included

        whether they would build homes in a style which harmonised with the existing village, as their display boards showed very different designs with no local reference or roots

         whether they would offer compensation to local residents close to the development and to the construction disruption

         whether they would consider buying by agreement any homes badly affected, and including them in the scheme.

                I am willing to pursue these or other issues for residents if they would like my help.

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      The Euro crisis has been postponed. The Euro area has now adopted the very popular approach in the modern west of simply printing more cash to see them over a rough patch. The European Central Bank’s decision to lend more than half a trillion euros to Euro area banks, for 3 years at 1%, was the nearest thing to a free gift to the banks they thought they could get away with.

          In the short term it has worked. Very weak banks now look stronger, because they can now get their immediate cash needs direct from the ECB. They are not so beholden to the markets, who were getting prickly about which banks to lend to, how much to lend, and what price to charge. Some banks are using extra cash borrowed cheaply from the ECB to buy into the sovereign bonds of Italy and Spain. They can then pocket the difference between the 4-7% yield they pick up on the bond, and the 1% they pay …

            This morning I spoke to the Maiden Erlegh Sixth Form as part of their General Studies. I was assured that Labour and Lib Dem representatives have been invited in to speak at later dates to provide balance.

            I spoke to them about the changing landscape of work, where more jobs will have to come from self employment and small companies, as the total number of  new jobs available in the public sector and UK based large companies declines. I talked of the huge opportunities the internet and other new technology offers, where a student in his bedsit in Harvard University can set up a business which makes him a multi billionaire in his twenties. I reminded them as an example that the pharmaceutical industry, traditionally a big employer of UK scientists, is now wanting the early research work to be carried out by small sub contracting companies.

            There were two main sets of questions. The first were criticisms of Dr Cable’s tuition fee and loan scheme, and …

Let us assume Mr Montgomerie did his research well. I have no doubt that the issues raised by Number 10 are serious ones which Conservatives need to address. He mentioned two in particular which do matter a lot. He reported that there are worries the health changes could upset more electors. He quoted a Lib Dem source as saying that Conservative Ministers are not engaged in tackling one of the great evils of our time, unemployment.

I disagree with his …

I am also pleased to hear that anybody in work is exempted. The Government’s case revolves around something with which I believe the Labour party normally agrees: working should always be worth while. In today’s debate, there has been more heat than light. If the Labour party, the Conservative party …

Many Eurosceptics thought that once a new Treaty proposal came along, all the UK Prime Minister had to do was to table a series of amendments and opt outs for the UK so we could loosen our relationship, as our price for signing up to let the others move forwards to yet more closer union. After all, they argued, the previous Conservative governemnts had managed to negotiate effective opt outs from the social chapter, the common borders, the criminal justice provisions and the single currency. Labour has now given most of those away, and most Conservatives want to get control back over vital matters like borders, criminal justice and the economy.

The proposal for a new Treaty came along quicker than the government had expected. Mr Cameron asked for less in exchange for UK consent to the others going ahead with more integration than I would have wanted, but had even his modest demands …

I have no objections to successful Directors and executives in the private sector being well rewarded. That is a matter for their shareholders and for them. Government cannot get into the business of setting levels of pay throughout UK companies , especially as they have to compete in a global market where talented people and successful companies can take themselves elsewhere if government interferes too much. Government has enough to do, without trying to decide what is fair or reasonable for a Director to be paid.

I do have objections to a few employees in the public sector being paid much larger salaries and bonuses …

            It was typical of Mr Miliband that he used a good phrase out of time and when it was not true. Mr Cameron used the veto , refusing a UK signature on the proposed new Treaty before Christmas, and then renewed the same veto this week. He has made it crystal clear that the UK will not sign the proposed Treaty, will not surrender more powers, will not submit its budgets to Euro style controls. I for one am relieved Mr Cameron was doing the negotiating rather than the Labour leader. Labour in office gave away huge powers at Nice, Amsterdam and Lisbon.

             Some smell treachery nonetheless, saying that Mr Cameron should also have made sure the European Court of Justice  will not adjudicate in matters arising from the Treaty of the 25 proposed this week. Labour, of course, negotiated the UK into an arrangement under the existing Treaties where the Euro area requirements of the 17 are under the ECJ and serviced by the EU, even though 10 …

          Defra has recently published a large amount of material on climate change. It needed to do so under the last government’s  legislation, to produce a “risk assessment”. I went along to hear about it from the Chief Scientist and Secretary of State, and have read more about it on their website.

          The fascinating thing is how uncertain the scientists are about their predictions. By the 2080s they forecast an increase in temperature in the UK of somewhere between 1 degree and 8 degrees.  They think summer rainfall may have increased a bit, or may have fallen sharply. They think winter rainfall may have stayed the same, or may go up a lot.

            They are not even sure what is happening to emissions of carbon dioxide. They say “It is too early to establish whether actual emissions are pursuing any particular emissions scenario”.

               Their historical graphs show that there was no warming between 1860 and 1970 overall.  This was despite a very intensive coal burning phase to …

            Mr Hester decided to waive his bonus when he heard there would be a Commons vote on it. Labour who had signed such a generous contract in the first place decided to table a debate and vote  in Opposition time to condemn it to make amends for their original deal. Many Conservatives and Lib Dems would have voted with them. 

             The truth is the Board of RBS was set the wrong task and given the wrong remuneration for doing it when the bank was stupidly nationalised in the first place.

              Will this government now call them in and change the requirements? They should be instructed to split the bank up, creating new functioning smaller High Street banks which can be immediately floated off into the private sector, where they need to raise more capital to allow them to lend more to power an economic recovery. The sooner the government does this, the sooner its economic policy will function better. If the current Board does not want to do this, then …

          Mr Osborne’s rhetoric on using the IMF to prop the Euro has firmed up more. He has always said the IMF should not lend money to prop up a currency, only a country in trouble. I interpret this to mean the IMF should not lend to any Euro member, as that would in my view be lending to prop a currency. Mr Osborne may define it less severely.

            Now Mr Osborne is saying the UK should not make more money available to the IMF to lend to Euro members, unless and until France and Germany have made a larger contribution. He seems to have in mind those states putting more money into the European bail out fund. This is extremely unlikely. Germany thinks the problem countries should do more to rein in  their own deficits. France is becoming financially strained herself and is not looking for more ways to spend money. That would seem to mean no more UK money for these purposes, which would be excellent news.…

          I would like David Cameron, in the privacy of the  meeting to say:

        “The UK wishes Eurozone members success with their currency. We will not be providing unhelpful remarks or commentary in public on it. As the Eurozone sells us many goods and we sell into the zone, it is in our interests that the future of the zone is handled with a view to restoring growth and greater prosperity.

          The UK does not think further Treaty changes demanding greater austerity and financial discipline are either needed or will work. The current Treaties make it clear what is expected of Eurozone members. The problem is one of enforcement, not a shortage of law and guidance.  Imposing fines on countries with large deficits that can no longer borrow money in the markets to pay their bills, let alone pay the fines, is not going to improve things.

          The Uk sympathises with the German view that each Euro member state has to solve its own budgetary problems and …

          I would like David Cameron, in the privacy of the  meeting to say:

        “The UK wishes Eurozone members success with their currency. We will not be providing unhelpful remarks or commentary in public on it. As the Eurozone sells us many goods and we sell into the zone, it is in our interests that the future of the zone is handled with a view to restoring growth and greater prosperity.

          The UK does not think further Treaty changes demanding greater austerity and financial discipline are either needed or will work. The current Treaties make it clear what is expected of Eurozone members. The problem is one of enforcement, not a shortage of law and guidance.  Imposing fines on countries with large deficits that can no longer borrow money in the markets to pay their bills, let alone pay the fines, is not going to improve things.

          The Uk sympathises with the German view that each Euro member state has to solve its own budgetary problems and …

        The cross party group on repatriating powers from the EU this week launched a piece of work on regional policy. They pointed out that the EU structural funds  account for Euro 348 billion over the seven year budget period, the second largest budget head in the EU accounts.

          The UK is the third largest loser from these funds, after France and Germany. We contribute Euro 35.9 billion over the 7 years to these funds, and receive back just Euro 10.6 billion. Much of the money goes in circular flows, being sent to the EU only to return to the original contributing country, or even circulating within the same region via Brussels.

           In the case of the UK 70% of our overall contribution goes to other member states. 25% of our contribution is given back  to the same region that raised the tax and sent in the money in the first place, with 5% being sent back to a different UK region.

           Apparently the last Labour government looked …

          The media is contrasting the  US growth rate which hit 2.8% per annum in the last quarter of 2011 favourably with the stalling economies of Europe. What they are not doing, however, is picking up on the different composition of growth.

            In the UK the public sector made a positive contribution to growth, whilst industry and mining fell, producing an overall small decline.  In the US federal spending was down 7.3% and total public spending  down by 4.6%  whilst  the private sector grew well, producing the overall gain of 2.8% per annum.

 I presume this part of the truth did not fit in with the highly spun stories abouts cuts, or with the belief that Obama has avoided cuts.  The facts show in the last quarter tough cuts in US public spending along with good growth. In the UK there was public spending growth with no overall growth.  That’s too difficult for UK commentators to explain!

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We meet today because we wish to influence our Government in what they are doing at yet another important European summit. The European Central Bank has bought the Europeans a little time by printing and lending unprecedented sums of money to a very weak European banking system, but those …

             When the government was working on a new policy for high pay and large bonuses I raised the issue of RBS. I raised it again when Dr Cable announced his policy in the Commons. People will judge the success of Dr Cable’s bid to control large bonuses in no small measure  by the government’s  success in handling RBS pay and  bonuses, where the government is the shareholder and the employer.

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          Modern politics is besotted by all three main parties chasing the fairness vote. In a time of austerity, they intone, it is important that government is fair.

            At the highest level I have no problem with this. What politican or political party would want to make unfairness their aim?  It is part of  a trite catchphrase. Of course all those of us with some public spirit and some grasp of democratic politics wants things to be as fair as possible, and wish to design and back policies that are “fair”. Any good  MP or Minister has drilled into them the need to be fair to all constituents, fair between competing claims on their time and for their support, and fair in assessing need and cause. We have a duty to represent all in our constituencies or the wider nation, whatever their views and backgrounds.

            If you try to go further you start to appreciate that there are almost as many ideas of what is fair as …

                I have repeated many times the likelihood that the economy will grow much more slowly than government OBR forecasts. I have said the government will borrow more than is desirable. I have called for a stronger growth strategy.

                 Last year’s figures showing just 0.8% growth were disappointing to the official forecasters. They expected 2.4% growth for 2011-12 in June 2010, reduced that + to 1.8% in March 2011 and to 0.6% in November 2011.

                They are forecasting 0.9% growth  in 2012-13 and 2.4% in 2013-14, down from 2.9% and 2.8% forecast in June 2010. The IMF has now downgraded its forecast for the UK to a lower figure for 2012. If 2012-14 growth is still overstated by say 1.5% over the two years, that adds another £10 billion to the deficit in the second year.

                 The government knows it needs to do more. It is still working on  the credit easing scheme promised in the Autumn Statement. It has relaxed its borrowing limits to accommodate cash increases …

The Financial Secretary to the Treasury (Mr Mark Hoban): We are working with banks on the details behind the national loan guarantee scheme. We have set aside £20 billion to enable the rates that are charged to small businesses to fall by up to 1%. The utilisation of the scheme will very much be driven by the demand from businesses for debt finance.

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           Over the last quarter UK output fell by a small 0.2%. These preliminary figures are often revised upwards later. For the year as a whole the economy grew at just 0.8%.

           All this was well known and forecast. We have been talking here about the need for a stronger growth strategy for eighteen months, and clearly as the government recognises more needs to be done. What is far less well known is the fact that the government sector is still adding to the expansion, whilst industry and some private sector services are dragging the figures down.

            In the last quarter the  government sector was up 0.4%. Business and financial services were unchanged. Production and construction fell. For the year, government and other services were up 2.5%, business services and finance were up 2.1%, whilst production industries were down 2.6%.

           Perhaps all those who have been talking of the massive state cuts might like to explain how this results in a continued expansion of the state …