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Frack to the Future

More active than many peers half his age, Lord Lawson is busier than ever. And from shale gas to wind farms, from tax cuts to EU refor...

 

Words: Paul Waugh

Photos: Paul Heartfield 

 

 

"I think it’s appropriate that George Osborne is dieting,” Nigel Lawson says, with a knowing smile.“Controlling public expenditure is about saying ‘No’ and sticking to it. And dieting is exactly the same.”

As a former chancellor of the exchequer and the author of his own best-selling diet book, Lord Lawson of Blaby knows whereof he speaks on the issue of belt-tightening. And with a sprightliness and energy that belie his 82 years, one of the Tory party’s biggest of big beasts is relishing his role as a troublesome éminence grise.

The recipient of The House magazine’s Lifetime Achievement Award earlier this year, he’s helped redraft the UK’s banking regulation, runs a thinktank on climate change and is a constant critic of HS2 and the EU. A regular attendee in the House of Lords, Lord Lawson appears to be more politically active than at any time since his departure from Margaret Thatcher’s Cabinet 25 years ago. Far from resting on his laurels, he’s as focused on the future as any new intake MP.

Energy policy is one of his chief passions, not least since the creation of his own Global Warming Policy Foundation in 2009. But his keen interest in the issue stretches back to the early 1980s, when he was Margaret Thatcher’s energy secretary. With the coal strike looming, Lawson sought to redefine the way the UK bought and sold energy. Given the way the subject has soared up the political agenda of late, does he think he was ahead of the game?

“I do, if I may say so,” he says. “If you want an impartial witness, the leading energy economist in this country is Professor Dieter Helm, who has written the definitive account of British energy policy since the war. He says that the 1982 speech which I made to a meeting of the International Association of Energy Economists in Cambridge was the most important speech ever made by an energy secretary and it defined the whole of our energy policy for a long time to come.”

The main thrust of that speech was to say there is no reason to treat energy any differently from any other area of policy, despite the habit of British governments to interfere in the largely state-owned industry. “A sensible energy policy should be part and parcel of our economic policy,” Lawson says. “And just as our economic policy was to give the state a reduced role and to give market forces a greater role, so that should apply to energy as well.” Crucially, he prepared the ground for the gas and electricity privatisations to come.

The former chancellor has long defied the conventional wisdom on climate change too. When the world was congratulating itself on the Kyoto Treaty in 2004, Lawson was among those who wrote a letter to the Times warning of uncertainties in the science. Last year, he won a bet with Oliver Letwin that Kyoto would expire without any successor in place.

“I was not the first, but I think that certainly I realised very early on that this had been accepted as gospel by people who had not done any proper analysis,” he says. “It’s a new religion. That is why it is so difficult to change people’s minds, because they are not interested in the facts – it’s a belief system.” The Treasury still strong in his bones, he says the real issue is not so much the science as the policy response and a proper cost-benefit analysis. “What is the extent of the damage? And how does it compare with the benefits from warming? Because there undoubtedly are benefits, even the IPCC [International Panel on Climate Change] accepts that; it’s where does the balance lie?

“Then there is also the political issue that because it’s an extremely costly policy, it means we go from relatively cheap and reliable energy to relatively expensive and unreliable energy. And you’re not getting any benefit on the climate front because there isn’t a global agreement.”

One Cabinet minister who was brave enough to voice claims that there could actually be benefits from global warming was Owen Paterson. The Environment Secretary’s remarks to a Tory conference fringe last year caused uproar among some green groups. But Lawson is a big fan and says Paterson should not be moved in the coming reshuffle.

“I would be disappointed to see him moved out of government, not just because of this issue but because I think he’s one of the best ministers in the Government. I think he did a very good job in Northern Ireland and I think that he understands the countryside and farming very well, but he also has a very good mind. It would be a great loss to the Government, which needs all the talent it can get.”

He points out that conservation is a key Conservative belief. “Owen Paterson is very conscious of that. The green issue is not just one issue. If you get hung up on the evils of fossil fuel and as a result you litter the countryside with wind farms, not only is that economic nonsense in energy terms, but it is not environmentally friendly either. Solar farms, too, they are appalling environmentally. Wind turbines kill really serious numbers of birds.”

Of course, one of David Cameron’s first acts as Tory leader was to underline his ‘green’ credentials with his infamous trip to the polar ice cap. Lawson understands why David Cameron felt the need to ‘rebrand’ the Conservatives, but clearly feels it was misguided. “Margaret Thatcher, even though she was a really great prime minister, I think the country had got tired of her, as it gets tired of almost anybody after a long period of government,” he says. “But it was largely about her manner, not her policies. So there was no need to get a whole new raft of different policies in a great rebranding exercise. But the ‘hugging huskies’ and all that was part of the rebranding and of ‘going green’ in general.

“I think it was a great mistake. I think that, without really admitting it, I think they are trying quite hard to row back from that. But of course it’s always hard to row back from anything you’ve made a big splash about, but it’s all the harder because of the Coalition.”

Given his own enthusiastic backing for the expansion of the City during the Thatcher years, it’s perhaps not surprising that the former chancellor is not over-keen on the Coalition’s rhetoric about “rebalancing the economy” at the expense of financial services. “I think that is foolish and unwise,” he says. “The only sort of rebalancing I would like is to see the north of England share more in the economic success. But the way to do that is not by building this absurdly expensive High Speed 2, for which there is no sensible case at all.

“The way to do it is by developing shale gas resources in the north of England, particularly in the north-west,” he adds. “We need to go for that. If you look at what’s happened in the United States, it has completely transformed the economies of some of the poorest parts of the United States. We could have that here.”

George Osborne is resolutely behind HS2, but he does appear to have listened to people like Lawson and others who strongly support fracking. How often do the pair of them talk? “I do see him from time to time, but George sees quite a lot of people so I have no special locus,” he explains. The informal ‘council of former chancellors’ (Howe, Lawson and Lamont) no longer meets Osborne, however. “When I see him, which is only infrequently, I see him just à deux.”

 

 

A key area where the Coalition has been largely in agreement is on tax cuts. But as a reforming chancellor himself, Lawson believes his party will be able to do much more on personal taxation if it governs alone. “There is in the short term a conflict between cutting taxes and cutting borrowing. In the medium term, you can do both. When I was Chancellor, I abolished the budget deficit altogether and even got a surplus and at the same time I cut tax rates. So it can be done. But it takes a little time,” he says.

As someone who has written party manifestos in the past, he adds that “what you need to do is indicate very clearly the direction of travel” in 2015, rather than any pledges on specific rates. Crucially, he’s content with Osborne’s current thinking about the need to cut income taxes. “I think the present chancellor is very much taking this on board.” Lawson’s tax cuts, not least his slashing of the top 40p rate in 1988, famously sparked rapid economic growth. Does the current consumer boom, coupled with a similar house price spike, feel anything like the late 1980s and early 1990s?

“I don’t see a problem now. I think all these things need to be watched very carefully. I do think that the time has come for two things, because the economy is going well. The first thing is to wind back this rather artificial scheme of Help to Buy. The ceiling should be cut back to £300,000. And I also do think that the present interest rate of half a per cent, that is basically a crisis rate. It came in because of the economic and banking crisis, and now we are coming out of it we need to move to more normal rates. The sooner we make the first move, which would only be to go from half a percent to three quarters of a per cent, the better.”

Interest rates soared under his successor Norman Lamont, but he says that was “because they joined the ERM at the worst possible time”. By contrast, he’s remembered for the ‘Lawson boom’. Is that now a phrase with which he’s comfortable? “I’ve got used to it. And booms are certainly better than busts!” he replies. “But I think there’s a lot of nonsense spoken about it.” He rejects the idea that it was the inflationary pressures of the Lawson boom that forced him to shadow the Deutschmark. “That’s totally misguided. We had an inflationary problem in this country before we got into office,” he points out, referring to the record 26% under Labour in the 1970s. “When we got into office, it was still in double figures and the Treasury forecast was that it was due to rise.”

Lawson says that it was because “inflationary expectations were embedded in people’s minds” that he decided to allow sterling to shadow the Deutschmark. “We tried various ways to get inflationary expectations out of the system. It worked, but it worked very slowly and I was anxious that we should make more progress. And at that time, the country where they had no inflationary expectations at all – because they absolutely had a paranoia about inflation – was Germany, with their history during the Weimar period and all of that and also the inflation that happened after the war that’s often forgotten.

“They had a Bundesbank which had only one aim, which was to stop any hint of inflation coming. So I took the view that if for a time we piggy-backed on the Bundesbank, that would help; if that could be credible, that would help eradicate inflationary expectations in this country.”

Does he have any regrets about that, not least because some Eurosceptics say it was the move that foreshadowed the later disastrous ERM decision? “There was nothing political about it; it was entirely a means of trying to bear down on inflation. That’s all it was,” he says. The birth of the single currency was another matter entirely, Lawson stresses. “How you handle your own currency and abandoning your currency, they are two completely different things.”

It was another former Spectator editor-turned-MP, Boris Johnson, who urged David Cameron to go for an in/out EU referendum, long before No 10 was committed to the idea. Does he think it would be a good idea for Boris to return to Parliament? “Yes, I do. I think that Boris has a very special appeal to all sorts of voters who otherwise might not find the Conservative party very appealing, and therefore I think it would be excellent to have him on the team,” he says.

“Nobody’s perfect. It’s possible to point to aspects of Boris which you would perhaps feel uneasy about, but overall he’s a great plus.” And does he feel that the Mayor could even one day become PM? “I think that’s a big unknown. But anyhow it doesn’t arise. My goodness, 2020 – we don’t even know what’s going on in 2015, do we? Let’s see what happens in 2015, that’s the next election. I do think that if we are the largest single party, we should not try and form another coalition, but we should form a minority government as Stephen Harper did in Canada very successfully.”

If they can govern alone or in coalition, many Tories see a 2017 EU referendum as the key event of the next parliament. But is there a danger of an historic split in the party if the Prime Minister ends up recommending an ‘in’ vote after securing minor changes in Brussels?

“I think in the short run, David Cameron’s referendum pledge has united the party enormously, and I think it is the right thing to do. In terms of party management it has helped a great deal. We will just have to see when the time comes. There are two things which have to be assessed. First of all, what reforms – if any – he has been able to secure either of the European Union as a whole or of Britain’s position within the Union. And, in the light of that, does he have a case for recommending an ‘in’ vote or not? He will have to make his own judgement on that and the Cabinet will have to discuss it and make their judgement. I am convinced that – I may be wrong, but from my knowledge of the European Union – that nothing of any significance is negotiable. Not least because anything of significance requires treaty changes and treaty changes have to be agreed unanimously, so it’s no good just getting one or two countries on side, so I don’t think it’s on. But we shall see.”

And Lawson stresses that it won’t just be up to the PM or the Cabinet to decide the party’s line. Asked about the risk of the party rejecting a weak set of agreements and preferring a ‘Better Off Out’ position, he says: “I think he will take that into account.”

“Although as of now his position is that he’s firmly committed to recommending an ‘in’ vote, he’s a great optimist and he thinks he can negotiate all these changes. But I think he will have to reconsider his position in the light of what he is able to secure. He will know too that he has either got to persuade the parliamentary party overwhelmingly (there will always be dissent)…or else he’s got to reconsider his own position on this issue.

“Because the logic of his position is clear. He has said the European Union as it exists at present is seriously unsatisfactory, therefore some major changes need to be made. The logic of that position is that if you don’t secure these major changes, you leave the European Union. Not in any hostile frame of mind. As you know, I live in France and I have nothing against Europe as such.

“But you just have to say it is not in Britain’s interest to remain there. And of course it is made all the more likely by the creation of the eurozone, and they are also changing the qualified majority voting rules. We will find ourselves outside the eurozone…our influence on European Union law is bound to be less than it has in the past. There will be a solid eurozone bloc vote. If we oppose anything we will be overridden.”

So, does he envisage the PM consulting the parliamentary party on the in/out decision in 2017, just as it appears the 1922 Committee will be consulted in 2015 in the event of any plans for another coalition? “I think you’re right to draw parallels between the two,” he replies. “I think he will. Whether he does it through formal consultation or informally, I think he will need to do that.”

As he freely admits, Lord Lawson has no problem with European culture, as opposed to its institutions. He spends Monday to Thursday in the Lords and the rest of the week at his home in rural France. “It’s a complete contrast, and very deliberately so,” he explains. “It is a double life. I live in a particularly peaceful, tranquil area. I can relax, I can recharge the batteries, I can think and sometimes write. I’m in the middle of nowhere.” And far from being a Little Englander, he likes the fact that there aren’t many fellow English speakers nearby. “When I moved there 12 years ago, there weren’t very many Brits there. They have increased, but it’s not like the Dordogne or the south of France where there are lots of Brits or nationalities of other kinds.”

With a weekly airline commute to France, the long trek in and out of departure and arrivals lounges keeps him fit. “I have to go backwards and forwards travelling and the walking at airports is the exercise I take.” Despite the temptations of vintage wines and fine Gallic cuisine, his trim figure also proves he practices what he preaches on the dietary front, though he confesses not to know anything about the 5:2 diet adhered to by George Osborne. “Dieting is all about self-discipline, and you want to find a form of self-discipline which you can live with. What it’s all about is eating less and drinking less, it’s as simple as that.” And the economic metaphor is never far away.

“It’s appropriate that George Osborne is dieting, not because he needs to diet more than other people, but because one of the most important jobs of the Chancellor is to control public expenditure, particularly now that you have this enormous deficit, but at all times. It’s always been part of the Treasury’s DNA.”

His own appetite for controversy seems unsated, however. And in his ninth decade, he shows no signs of easing up. “For a very old man I’ve got, if anything, too much on my plate.” And despite his Protestant work ethic, Lord Lawson is certainly no puritan. “I do obviously have a private life as well,” he adds, with a mischievous smile. “I don’t want you to think that I’m just some Stakhanovite.”   

 

 

 

 

Balance of Power

She may be a lone figure in Parliament, but Caroline Lucas is more than capable of making a big impression. The first and only Green M...

 

Words: Daniel Bond

Photos: Paul Heartfield 

 

 

“I’m not evil!” Caroline Lucas declares. We’re sitting in an independent coffee shop in the middle of the Lanes, the sprawling labyrinth of narrow alleyways and small boutiques which make up the heart of her Brighton Pavilion constituency. On the door of the café hangs a sign warning that racists, homophobes, sexists and bigots are not welcome here. But it’s not an accusation of any of these vices which has riled the local MP. A fifth category hand-scribbled at the bottom reads ‘No UKIP voters’. But it’s not that, either.

The spark behind her pantomime exclamation is Russell Brand. “The people that work in there, it’s not like they’re inherently evil,” the comedian turned radical provocateur told thousands of anti-austerity protesters gathered under the shadow of the Palace of Westminster late last month. “I’ve met Caroline Lucas, and she’s alright, isn’t she?” he generously added.

The observation was not one of Brand’s most artful as he sashayed about the stage on that June afternoon; he went on to rally the assembled trade unionists and leftists with the articulate but boyish and self-deprecating rhetorical style in which he’s preached revolution and antagonised almost the entire political class by telling millions of his fans: “I will never vote and I don’t think you should either.”

But it was telling that he should single out the Green MP, who joined him at the People’s Assembly rally, as the last hope of Parliament. The pair, Lucas says, have worked together “very effectively” on drug law reform, with Brand’s widely publicised support – and his eight million-strong Twitter following –  “certainly helping” her recent petition calling for a Commons debate on the subject to easily surpass the required 100,000 signatures. 

Needless to say, she doesn’t agree with his controversial exhortation to abandon the ballot box. “But it was interesting just how resonant what he said was,” she adds. “It really caught people’s imagination and just struck such a chord, I think. What he’s saying is people don’t vote because they don’t think their vote makes a difference. And they’re probably right, in some senses, that it doesn’t make a difference. We shouldn’t think that politics is just something that’s done by white men in grey suits behind closed doors in Westminster. Politics is much bigger than that. And politicians should be listening, not slagging off Russell Brand because he’s suggesting that people shouldn’t vote for them – but actually looking at why there is such a disengagement still between them and the people they’re supposed to represent.”

Coming from an elected politician, this sentiment may sound strange. But then Caroline Lucas is not your typical MP ‘in a grey suit’. In a Westminster landscape whose inhabitants increasingly retreat into caution and circumspection, the country’s first and only Green MP offers something radically and refreshingly different. She’s softly spoken and meticulous in her process; almost every answer is preceded by a considered pause. But the arguments, when they come, are anything but soft. She’s forthright, articulate, impatient and angry: about austerity, about the state of British politics, about the advance of a bland and impotent centrism, about an ineffective Labour party, and above all about the lack of action to tackle climate change and the relentless advance of a new shale gas industry.

And she’s also not afraid to, in her own words, “put my body where my mouth is”. In April this year she stood trial – and was cleared – over a charge of obstruction, after being arrested taking part in a road blockade at an anti-fracking protest. Neither is this her first activism-related arrest; she’s previously been charged with breaching the peace during an anti-nuclear sit-in at Faslane naval base, and had a run-in with police during a Whitehall protest against the impending invasion of Iraq.

While she insists “peaceful direct action” is never something she “would do lightly”, she’s also defiantly unapologetic about the right, and duty, to take a stand if she feels the official channels have been found wanting. “It was after having arranged debates in the House of Commons, put down questions, Early Day Motions, gone through all of the parliamentary processes that I’m in a privileged position to have access to,” she says of her fracking arrest. “But at the end of the day, it felt like the Government wasn’t listening. And when so many of my own constituents were raising this with me, and indeed many of them were involved in it as well, then it felt important to be offering them support by going along and sitting next to them.

“I’m hoping that sooner or later the Government will get the message, because I think they’re going to find similar kinds of protests wherever they try to go ahead with fracking. I think people don’t want it, they’re deeply concerned about it, and rightly so.”

But while many of the concerns about fracking centre around fear of earthquakes or contaminated water and soil, Lucas’s opposition is much more profound. Even with “the best regulation in the world” protecting against these risks, she says, the fundamental problem with fracking would remain: “a whole new fossil fuel industry will be embedded in Britain at exactly the time we need to be shifting towards renewables.”

She says she accepts the need for “transitional fuel” to tide the UK over while renewables infrastructure is developed, but would prefer the Government to look to import from Norway – “at least then the tap can be turned off” – rather than deliberately incentivise an entire new industry which is “not simply going to pack up their bags and leave” in a few years. It’s also a myth, she continues, that the nascent shale gas industry will lead to lower fuel bills. “The head of Cuadrilla himself has said he doesn’t think it’s going to lead to lower prices.  [Climate economist] Lord Stern has called it baseless economics. The experience of the US is simply not replicable – you can’t transfer that across. Quite apart from the fact that the geology and the population density is different, we’re locked here into European and global markets. Fossil fuel that’s fracked in Balcombe doesn’t get used in Balcombe – it gets sold in European markets at the going European price. If we really do want lower prices and energy security then actually it’s through measures on renewables, decentralised energy, community energy, mass energy efficiency. Those are the ways we achieve those ends.”

But is there something more insidious behind the sit-ins and protests? Nato chief Anders Fogh Rasmussen raised eyebrows last month when he claimed that Russian agents were covertly stirring up and backing anti-fracking sentiment in order to maintain European dependence on its gas. Lucas scoffs at the “preposterous claim”, taking it as evidence that her fellow campaigners “are being quite successful” if they’re getting under the skin of such establishment figures. But while the claim is laughable, she says, it is also worryingly dangerous. “It’s deeply irresponsible. To suggest that sincere people who are protesting in good faith are somehow being stirred up by the Russians is just ludicrous! And I think it raises questions about the judgement of somebody in a very powerful position as the head of the nuclear alliance in the Western world, that they would come up with a suggestion like that.” In fact, she jokes, given the Government’s reluctance to pursue a more rigorous renewables agenda and the UK’s growing dependence on imports, she often wonders if the Department of Energy and Climate Change itself has not been infiltrated by foreign agents. “They seem to have been quite successful at turning the Government off the very things that actually would deliver them energy independence and security…”

At the time of the widespread flooding across southern England last winter, Lucas expressed her wish that – while one set of floods could not definitely be linked with climate change – the increasing frequency of such disasters would serve as a “wake-up call” on the need to act. Five months later, and with fracking set to continue apace, she is less optimistic. “At the time, there was a real outcry. And yet the media agenda moves on,” she says. “People have short memories. It’s so dispiriting to feel that we’ll have to wait for the next set of floods before politicians will make that connection.”

That thought may sound like enough to push any environmentalist towards despair, but Lucas is remaining unwaveringly positive. Despite her scepticism about the state of Westminster politics – a system, she says, whose adversarial nature and short-term inclinations make it “almost uniquely” ill-designed to tackle problems as huge and complex as climate change –  she's certain politicians can get their heads together and act, provided they continue to be put under strong public pressure from campaigners.

 

 

But there’s more underpinning Lucas’s optimism than a cheerful disposition. The green movement, she says, has been pessimistic and doom-mongering for too long, and has learned the hard way that issuing apocalyptic warnings about the scale of destruction climate change could cause is not the most effective way to inspire people to bring about change. “I think we assumed the green message was something we had to persuade people to do against their own better interests, as it were. It’s been framed as sacrifice. And that’s not only unhelpful, it’s also untrue,” she says, pointing out that, aside from tackling climate change, a green economy would bring with it a host of other positive outcomes: new labour-intensive industries sustaining more jobs; insulated homes and the eradication of fuel poverty; affordable and reliable public transport; stronger local food markets; cleaner air; even more “kids playing in the street”. To illustrate her point she describes her favourite cartoon, depicting a professor at a climate summit outlining all the benefits of a green, zero-carbon economy. In the audience, someone has their hand raised, asking: ‘but what if climate change is a hoax and we create a better world for nothing?’

“And that’s exactly it,” Lucas says. “We can create a better world, it would be a better world, and the fact that it would enable us to live more in harmony with our environment and not exceed our climate limits is all to the good as well. But the two things are part of the same project.” 

The next crunch point in the tug of war over shale gas will come with the Government’s attempt to relax trespass laws to allow fracking firms to drill under people’s homes without their permission. The proposals are likely to be brought forward later in the year, subject to the ongoing consultation, and ministers claim Labour have offered their backing. Lucas is “amazed” that the Opposition appears willing to support the move, “even from just a narrow electoral perspective”. “I think they’ve massively underestimated the scale of popular opposition to this. It’s deeply unpopular around the country; there are polls that show that.”

But Labour’s position on fracking is just one example of a wider cautious tendency holding the party back, she says, describing her “disappointment” at the lack of a “robust progressive opposition” to the Government and its austerity programme coming from Ed Miliband. The Labour leader, she fears, has been more interested in genuflecting to the agenda set by the Conservatives, and appeasing his party’s re-emerging Blairite wing, than following the arrow of his own principles. By way of example, she cites Miliband’s response to the IPPR’s recent Condition of Britain report, and his pledge to reform Jobseeker’s Allowance for 18-21 year-olds.

“There were some good ideas in that report, and yet the thing Miliband picked out of it was something that ended up reinforcing the idea that young people are at fault themselves if they don’t have jobs,” she says, her voice straining with frustration. “That just seemed like such an own goal. To boil it all down to that one policy, and then to frame it – and this is the crucial thing – to frame it within the language of punishing the poor, or young people without jobs, was just such a desperately missed opportunity. I don’t understand why they allowed that to happen. On so many issues, it feels as if Labour just doesn’t have the courage of its convictions it used to have.”

Growing more animated, she continues: “The first thing Rachel Reeves said when she got her [Shadow Work and Pensions] post was that she was going to be ‘tougher on welfare spending than the Tories’. Why go into that language? You can never out-Tory the Tories. Why try?

“They’ve accepted the premise of the Tory framing, rather than having the courage of actually saying ‘hang on a minute, these austerity measures have been counterproductive’. Austerity policies have completely failed. But I’ve been on Question Time, and on panels everywhere else, and it’s been down to me to defend Labour against the charge that the economic crisis was caused by their rash overspending in a previous administration.

“It’s not my job to fight it,” she adds, bashing her fist on the table. Come on, fight it yourself!”

Despite her frustration, Lucas clearly retains a residual respect for the Labour leader, with whom she’s shared “several cups of tea”. But rather than engaging in an axe-sharpening contest with the Conservatives, she says, he should be bringing forward a radical programme to change Britain, from the renationalisation of the railways – “I’m amazed they haven’t adopted it, it’s hugely popular” – to an ambitious house-by-house insulation programme funded by carbon taxes – “it would create hundreds of thousands of jobs, get fuel bills down and get carbon emissions down. There aren’t many win-wins in politics, but there’s one staring people in the face” – to the building of social housing and tougher action on rents.

One advantage of having a Green presence in the House of Commons, she continues, is to pressure Labour to go further in these areas and, just as importantly, to “keep their feet to the fire” to ensure they deliver on the pledges they have made. During Labour’s Opposition Day debate on introducing mandatory three-year tenancies in the private rented sector, she tabled an amendment attempting to push the party further, to offer five-year tenancies and tougher rent controls. Clearly those types of amendments “are not going to get passed” in this parliament, she admits, but they do “put down some markers, give us somewhere to be in that debate and show what we would like the debate to be about”.

But Lucas’s presence as the sole Green in the Commons is more than just symbolic. She says she’s been surprised and “heartened” by the scope for collaborative work across party and ideological lines, having linked up with backbench Lib Dems over their shared opposition to nuclear power, and even Conservatives like Douglas Carswell over democratic reform. She’s currently working closely with Lib Dem MP Julian Huppert to draw up a motion – which she hopes can rally widespread support – calling for an independent cost-benefit analysis and impact assessment of the 1971 Misuse of Drugs Act.

And she also has no shortage of friends on the left of Labour who share her frustration with their party’s direction. She shared a stage at the People’s Assembly with left-wing stalwarts Diane Abbott and Jeremy Corbyn, who both used their speeches to criticise the Labour leadership. In moments like that, does Lucas ever give them a nudge and remind them that there is another party opposed to austerity that they could join?

“Those conversations happen often. Certainly with Jeremy: ‘come on, you agree more with us than you do with them, come on!’” she says. “But there are different strategies out there to bring about change. We need people inside the Labour party who are challenging from within, as well as people outside challenging from without. I think the knack is to get the coordination, so you’ve got strong public pressure at the door, you’ve got people inside Parliament who are really challenging and lobbying for change, but also having some of those voices inside those other parties. That’s got to be a good thing as well.”

“Which isn’t to say,” she mischievously adds, “that if Jeremy would like to join the Green Party there isn’t a door open to him…”

But the polls – and the bookmakers – suggest Labour will emerge as the largest party in a tight election in 2015. In this spirit of cross-party collaboration, would she be prepared to work alongside a minority Labour government under either a formal or informal agreement? After a pause to think, the familiar smile spreads across her face. “It’s not something I’ve thought about,” she tentatively replies. “My focus right now is on keeping Brighton Pavilion, and I’ll answer all of those questions about what might happen if I do win Brighton Pavilion if and when I do.”

It’s not a ‘no’. But Lucas has clearly relished the freedom her almost independent status has afforded her, to pick her battles, to hold the mainstream parties’ feet to the fire, to, as she puts it, “be that radical voice and yet also be constructive and work with others too to get things done”. “But I would certainly like it even better if we had some more Greens in here, that’s for sure,” she continues. “There’s so much to be done, there are so many priorities. You feel like you’re chasing your tail to some extent because there are just so many demands.

“But having said that, I think we have been able to demonstrate that even one MP on their own can make a difference.”    

 

 

 

 

Stern Warning

By the end of this century, global temperatures could soar to levels unprecedented in all of human history. Lord Stern tells Tony Grew...

 

Words: Tony Grew

 

Oscar Wilde once said that the only thing worse than being talked about is not being talked about. That isn’t a problem for Lord Stern. To the journalists at the Independent, he’s “the world’s most authoritative climate economist”. Over at the Telegraph, he’s been described as “the most dangerous man you have never heard of”.

“I don’t think anyone enjoys public attacks, but if you speak about public policy then you are going into an area where these things come,” Stern explains when he meets The House in his office at LSE. “In climate change the attacks are particularly unpleasant. There are big vested interests, and many scientists have come up against horrible personal attacks. Nigel Lawson on the Today programme referred to a very distinguished scientist, Dame Julia Slingo, as ‘that woman’. Steve Schneider, a wonderful climate scientist from University of Berkeley, was constantly having to change the security systems on his house, constantly receiving threats.”

Stern is the climate change equivalent of a household name. The Stern Review on the Economics of Climate Change, released in 2006, laid out the economic impact of climate change on the world economy. It is inarguably one of the most important documents about climate change ever published. It had a profound influence on the Climate Change Act 2008, which set the UK on course to become a low-carbon economy by imposing targets to reduce net greenhouse gas emissions by 80% from a 1990 baseline by 2050.

Nicholas Stern, an economist and lecturer, became The Lord Stern of Brentford in 2007 and has been Chair of the Grantham Research Institute at LSE since it was founded in 2008. His latest academic paper, ‘Endogenous growth, convexity of damages and climate risk: how Nordhaus’ framework supports deep cuts in carbon emissions’, has been co-written with the Grantham Institute’s co-director Dr Simon Dietz. Stern and Dietz argue that recent reports from the UN Intergovernmental Panel on Climate Change have underestimated the financial costs of climate change because the economic models used have “severe limitations”. “Standard economic models, such as those cited in the IPCC report, have made assumptions that simply do not reflect current knowledge about climate change,” Stern said last month.

He tells The House that climate change ‘deniers’ are following a similar pattern to the tobacco industry’s response to a link to lung cancer. “We are shifting round probability distributions. Like giving up smoking. You don’t discount the risk of lung cancer, you just make it much smaller,” he says. “In this context the deniers would say we can disregard the risk of lung cancer from smoking – ‘I suppose it could happen but it is trivially small’. That is the game the tobacco companies played. They said this is about risk and since we don’t know exactly what the risks are, let’s assume they are small.

“There is a very good book by Naomi Oreskes and Erik Conway called Merchants of Doubt which traces attacks on science over quite a long period of time – smoking, acid rain, climate change – and shows there is a systematic similarity in method. When you are dealing with uncertainty, you say ‘we do not know what will happen’, which is true. But it is our job to consider the risks that we face and how we can make those risks less.”

Stern uses language with a precision one would expect from a world-renowned economist, but there is still frustration at the antics of deniers of the facts of climate change. “I think it is often denial of the science. Sometimes it is deliberate minimisation of risks, sometimes it is asserting that while the risks might be there you can be very confident they are small.

“There has been some shift from the outright denial of the science, which is just daft given 200 years of very serious science. That has shifted over time and now it is more likely to take the form of ‘whilst there might be something there, we can be very confident the risks are small’.”

Stern says that while we cannot be sure how big the risks are, “you can give evidence on the possible magnitude of the risks and there is very powerful evidence those risks could be big”. “To assert you can be confident the risks are small is a perversion of the science. It gently or grudgingly concedes there might be some effect there, but the denial shifts.”

Politicians prefer the language of certainty to that of risk and probability. Stern says his latest paper shows the situation could be more serious than he initially thought. “I have said over the last five or six years that it is more serious than I gave the impression it was in the Stern Review because the information has changed.

“Most of what we say is about things that are not certain – it is about likelihoods, things that could occur, sometimes we can’t even talk of probabilities. We are very cautious about saying things with total confidence – I always try to speak the language of risk. What we know about climate sensitivity at the moment suggests that if we go on as we are, that sometime at the end of this century or early in the next century the temperature increase, with a probability of perhaps 50%, could be about 3.5C to 4C relative to the end of the 19th century. That is the kind of statement we have to make.

“What people don’t understand is how big a statement that is. That is extraordinarily strong. We have not been at that temperature for maybe 30 or 40 million years. We have been around as human beings for perhaps 250,000 years.”

Stern agrees that the challenge is one of communication. How can scientists, economists and political leaders get the message to voters? He gives a handy analogy. “If someone offered you an airline flight with a 90% chance of getting there and not crashing what would you do? It is our job to try to express ourselves in a way that is true to the data analysis we have, but communicates better about risk. We know from basic behavioural psychology that human beings are actually rather bad at handling and understanding risk.”

Stern is upbeat about two major changes since he wrote his review in 2004 – China, and the rise of technology. “I don’t think we anticipated how quickly technology would change – it is remarkable. Partly economies of scale, learning by doing and things like solar; partly new techniques, partly ICT giving you much more opportunities for energy efficiency and managing demand. Our ability to handle climate change has moved forward much more rapidly than some of us anticipated.”

Stern has been visiting and studying China for a quarter of a century. Recent changes are as much about national self-image as science, he argues. “They have really realised over the last five years just how big they are in world output, world trade, world emissions, they have taken on board that other people react to China. It is not China emerging into a world where they are entering a stage that is already there and might not be affected too much by their entrance. Now, they are front and centre of this stage. They realise that what other people do is influenced by what they do.

“China has changed in terms of the un-liveability of many of their cities – it is difficult to breathe in Beijing or Shanghai at certain times of the year. China has really woken up to this and has been in the lead in many ways of driving the costs of alternative technologies down. It will be in the lead in bringing the cost of nuclear down. What you have seen is that as Europe has wavered, China has started to really take the problem seriously and, indeed, started to change its ways.”

That European “wavering” represents a huge missed opportunity, Stern says, arguing that the economic crisis has diverted attention from climate change. “When you have got interest rates on the floor and unemployed resources, that is the moment to invest in the growth story of the future, that’s when to invest in a safer world.”

He is politely sceptical when asked if the Conservative/Lib Dem coalition is, as David Cameron claimed it would be, “the greenest government ever”.

“It is not clear that it is.  Neither is it a particularly interesting league table to play in,” Stern observes. “A better question is ‘are we really understanding as well as we should the magnitude of the challenge, the magnitude of the changes, the opportunities in those changes?’ My answer is no. It is disappointing, but if you look round the world, the world has changed. But we should not just be distorted by European spectacles. The most important thing in terms of encouraging long-term investments is the right kind of incentive structures, but just as important is stability in those incentive structures, so people are making long-term investments. It is very important to keep stable signals and that is what has been so disrupting.”

He adds: “Some things have stayed stable – we have the climate change legislation and the climate change committee and carbon budgets. Those have proceeded and those are good things, but you have also had the noises off.”

Some Conservatives have been accused of regarding the green agenda as ‘crap’, while Labour has focused its rhetoric on the Big Six energy companies and promised a ‘price freeze’ if it forms the next government. Stern says there is “a really bad understanding of where the price increases over the past eight or nine years came from”.

“Basically the cost of electricity faced by homes has in large measure been determined by the price of gas,” he explains. “And what you have seen over the last decade is a very big increase in the world price of gas. That is not in the hands of the energy companies, it is something they face. Reading some of the newspapers, you would have thought it was the renewable targets that had driven up the price, but they have had a very minor role in all this.”

Stern says “climate denial, which is particularly associated with some of the backwoodsmen in the Tory party” is one of the factors holding the UK back when it comes to green energy innovation. “A major recession has diverted attention from these issues and a big rise in gas prices has forced up electricity prices – note that it is the hydrocarbon prices that have forced it up. So you have these things coming together and that has changed the politics.

“Ed Miliband is taking the view that the big increase in prices has been cumulative rip-off artistry from the energy companies. I don’t think that is an entirely good description of price increases over the last decade. It is price increases in energy that have quite understandably concerned people. It is a big slice of their budget. Where does that come from? Mostly from the rise of the world gas price. Has it come from an increase in the monopolistic practices of the energy companies? That has to be established. Remember, an increase in the monopolistic practices, you would have to argue, has caused that increase.

“Has it come from extra emphasis on renewables? Demonstrably very little of it. What that case is predicated on was the anger over the price increases, but to put it down to ‘green crap’ or to the monopolistic practices is quantitatively to have the tail wagging the dog.”

Lord Stern has the platform of the upper house to continue his work on the economics of climate change. He wants to spend more time at Parliament when his commitments allow – as well as his work at LSE, he is President of the British Academy.

“There are many extraordinarily interesting people in the Lords who have really important life experiences that they bring to the table, particularly among the crossbenchers. People like Eliza Manningham-Buller, former head of MI5; John Browne, who has run a major energy company; Bob May and Martin Rees, who have been president of the Royal Society.

“I have been a bit disappointed by a number of people who have just come up through the Commons and sometimes seem to behave in the way the Commons behaves. My impression of my fellow peers is variable. Some of them are extraordinary talented people with great life experience, but not all of them.

“I do try to get there at least on Wednesdays, but one of my intentions over the coming years as I manage to control my commitments a bit better is to put more time in. I am full of admiration for my colleagues who really settle down over the scrutiny of legislation. I have come to realise how important that is.”   

 

 

 

Iain Martin: As summer recess approaches, will Westminster again get the July jitters?

There is a long history of intensity of feeling in July clouding the judgment of those in power. What is it about Westminster and the ...

 

As an editor I used to work for liked to put it: “They always go mad in July.” By “they”, he meant MPs and political journalists, and by “mad”, he meant that by now every year some of the inhabitants of the Palace of Westminster have become over-excited. The end of term in the hothouse is looming and the beach beckons.

Sometimes the hysteria centres on a serious potential scandal, such as the recent child abuse allegations and claims that complaints about powerful figures were suppressed and not properly investigated in the 1980s. In other years, people will have serious difficulty remembering in August just what it was that got them so agitated a few weeks previously. In journalistic circles, this phenomenon is so well-known that the BBC’s Jim Naughtie chose The Madness of July as the title for his recent thriller. But what is it about Westminster and July?

There is a long history of intensity of feeling in July clouding the judgment of those in power. The Suez crisis of 1956 began in July. On the 26th of that month, President Nasser of Egypt announced that he intended to nationalise the Suez Canal, a declaration which threatened British interests.

So robust was the mood of the House the next day when MPs met on the 27th that Anthony Eden, the Prime Minister, became convinced – entirely mistakenly – that he had sufficient support on the government benches to take whatever measures he deemed necessary in response. From there he embarked on a course of action that culminated later that year in military disaster, diplomatic disgrace and resignation.

In July 2011, it seemed as though MPs were about to bring down the media mogul Rupert Murdoch. When it was revealed that the mobile telephone of the murdered schoolgirl Milly Dowler had been hacked, MPs were in uproar. The News of the World was closed, David Cameron announced a public inquiry into the conduct of the press and Murdoch himself was summonsed to appear in front of a parliamentary committee. These were serious events, but the sense at Westminster in that period of there being an imminent cultural revolution ended up being overheated nonsense.

Indeed, heat and sheer exhaustion may be the root of the problem. In the heat and humidity of summer, sweaty London cooks. And unfortunately, despite its many other virtues, large parts of the Palace of Westminster lack adequate air conditioning. By July, the various combatants have also usually exhausted themselves after months of work. Since the conference season in the preceding autumn, it has been ‘head down’ for the party leaders, ministers, MPs and advisers. Everyone needs to hit the refresh button.

Incidentally, before assorted MPs complain, I am aware that recess does not equal holiday, and that constituency work will continue on the ground while ministers carry on commuting and being ministers. But most MPs – and journalists – will find time this summer for several weeks in the sun, involving the reading of books which are too often about politics.

This year, the inhabitants of the Palace of Westminster are in more need than ever of a proper rest. When the Commons returns, briefly before the party conferences of September and October and shortly before the result of the Scottish independence referendum is known, it will be portrayed by my industry as the start of the long election campaign. If the Scottish vote on 18 September goes the wrong way (declaration, I’m for the United Kingdom), there will follow an extraordinarily intense period of activity as the break-up of the UK is negotiated.

If Scotland votes to stay, then there will be a more conventional pitch into a pre-election period. All the party leaders will use their party conferences to begin framing an appeal to the electorate ahead of May 2015.

In the final months of the year, attack lines will be tested and election machines patched together or fine-tuned. There will then be a remorseless battle fought for the headlines and for the domination of the airwaves, as the parties try to convince a sceptical electorate.

Before all that, everyone needs a holiday.

 

Iain Martin is a political commentator

 

 

 


Born Again Banking

After spending 25 years in financial services, Andrea Leadsom knows a thing or two about the big challenges facing the City. The new E...

 

Words: Paul Waugh

Photos: Paul Heartfield 

 

 

“They were thinking, ‘you must be off your rocker’.” Andrea Leadsom is recalling a Parliamentary selection meeting, more than 10 long years ago. A political baptism in more ways than one, she had turned up to the Reading East event just hours after giving birth to her daughter. “The day you give birth, you feel like you can do anything,” she explains. “The day after, you feel like you’ve been run over by a bus…”

Rob Wilson won the selection race for the marginal seat that day, while Leadsom ended up as Tory candidate for the unwinnable Knowsley South in the 2005 election. But she was undeterred. When next interviewed for David Cameron’s ‘A-list’ of candidates, word of her previous post-natal heroics had got around.

Her interviewer asked her if she was ‘The One’ who had bounced from childbirth to a hustings meeting. “It was my ‘Top Gun moment’,” she says, referring to a scene in the Hollywood movie in which the hot-shot pilot reveals he’d flown his jet upside down, feet away from a Russian MiG. “You know, when Kelly McGillis says to Tom Cruise ‘So, you’re The One?’”

It’s safe to say that Andrea Jacqueline Leadsom is unafraid of notoriety, nor of fighting her corner. Having been eventually selected for South Northamptonshire, she nearly doubled the Tory majority and entered the Commons in 2010.

Typical of that intake’s independent-minded cohort, she proceeded to defy the whips on topics ranging from an EU referendum to gay marriage to HS2. Yet after a successful four years on the Treasury Select Committee, during which she memorably clashed with Barclays chief Bob Diamond, she joined the Government this April.

A former female financier in an era when machismo was the watchword in the City,

the Economic Secretary to the Treasury is certainly well placed for her new role. Today, her duties include reform of the financial services industry in which she worked for 25 years. City competitiveness, bank lending and Help to Buy are all in her packed in-tray. And she’s in a hurry.

With the hangover of the 2007/8 financial crisis still lingering, does the City at least now ‘get it’ and is learning the lessons of what went wrong?

“I would say that at the top echelons of the banks, absolutely. But I think there’s quite a long way to go to really change the culture. I think it did become very transaction-oriented and I think it will take time to recover that,” she says. “I think we are still going to see a lot of cringeworthy announcements.”

What does she mean by ‘cringeworthy’? “We’ve had a number of issues over bank wrongdoing,” she replies, referring to the Chancellor’s recent Fair and Effective Markets review of benchmarks in commodities and foreign exchange.

“There are inquiries going on, there are some pretty serious allegations out there, we’ve still got PPI going on. There are still things happening and redress under way. So it’s quite difficult to just sort of forget about that and move on. There’s still a lot of baggage.”

Yet she stresses her job is to accentuate the positive as well as not forget the negative.

“What we are trying to do is to really get to the bottom of everything that’s gone wrong but at the same time to move on and start looking to a more positive future.”

Does there still need to be some kind of ‘reckoning’ for the City?  “I think there does. But that’s ongoing and it’s good at the same time to have a new story to tell about more positive things.”

At 50, Leadsom speaks with the authority of someone who knows the finance industry better than most. She points out that as early as 2000, when she was both Head of Corporate Governance and Senior Investment Officer at Invesco Perpetual, she developed a new way of rewarding staff based on short, medium and long-term performance of their teams and the company. “I’m very, very proud of that. When anyone says ‘you can’t pay banks on a quantitative scheme’, I’m like ‘yes you can, I’ve done it’.

Thanks to Invesco’s star fund manager Neil Woodford the firm shrewdly shunned banking stocks in the run-up to the financial crisis. But a key event sticks in Leadsom’s mind.

“Our US equity fund manager I remember in about 2006 coming in to see the chief investment officer who I worked directly for and with and saying that the US property market is going to hell in a handcart, that people are so over-borrowed and over-lent to that they are buying properties with no deposit and then they are just handing back the keys because they can’t afford it any more. He was painting a really dramatic picture and I certainly remember that Neil Woodford was not touching any securitisation for quite a long period. So in that sense I suppose the fund managers had an inkling.”

Leadsom stresses that Invesco, working out of Henley-on-Thames, was “slightly removed” from the City. But she certainly was in the Square Mile when she worked her way up through Barclays in the decade beforehand. “’87 to ‘97 was a really telling period because I had my time in the dealing room, where I took the view that the money market guys were the honest ones with the cardigans and beards. They would never fiddle anything. So the day we heard about the Libor rigging, I just thought ‘well if Libor is rigged then what wasn’t rigged?’”

When she was running the Barclays investment banking team, she saw small brokers, equity specialists and partnerships steadily merged and bought out by big banks and asset management firms. “The whole concept that they used to have of a partnership, where ‘if I make a mistake I lose my shirt and my children leave their private school’ and that sort of scary thing, literally became huge golden hellos, massive bonuses and no down side,” she says.

“And that was in the mid-90s. I absolutely remember thinking at the time ‘why doesn’t the Monopolies and Mergers Commission think anything about this?’” And when Barings went bust, Leadsom recalls that the Bank of England dealt with it quite well.  “Eddie George was very quick to act, unlike with Northern Rock and he instantly rang me and a number of other key bankers to Barings and said ‘right we need to stop a run on the bank on Monday morning’. So we spent the weekend calling round different banking counterparts to sort of say ‘it will all be fine’.

“For me, that experience in 1995 really highlighted to me the later tripartite regime under Labour. The reason why there was a run on a bank [Northern Rock] was because everyone was looking at everyone else, thinking ‘You’ll take the lead, won’t you?’ ‘No, no, no I think it’s you’. There was that lack of accountability.” The new regime introduced by George Osborne has proved “essential”, she says. “When things go wrong the buck stops with the governor.”

 

 

Central to her mission at the Treasury now is to change the banking culture through more competition. “My big raison d’ être in this job is that competition should trump regulation,” she says. “People will always find a way round regulation, by definition. But actually competition is the great transparency, the great equaliser. Alongside regulation, that’s my agenda.”

Maybe competition is the best deregulator? “I’m hesitant to use the word deregulation where banking is concerned…but in the sense of making it easier to compete and in sense that new tech is making it easier to access finance and set up new diverse sources of finance.”

Leadsom praises some more established banks for their innovation. “For example Banco Santander have just set up an agreement with Funding Circle, a peer to peer funding organisation, where if Santander turn someone down for SME finance they will refer them to the Funding Circle and vice versa. Because a bunch of individuals with a bit of spare cash might find a proposition interesting that didn’t meet the bank’s lending and credit criterion.”

The rise of ‘challenger banks’ is key to the Treasury’s reforms too. “If you go to Kingsway [in London] and walk into the MetroBank, you’ll get doggie biscuits and a baby-changing facility, a colouring corner…and it’s in a retail space,” she points out.

This is an agenda, like others, that stems back to her days on the Treasury Select Committee.  “In 2010 we heard that MetroBank was the first full service banking licence to be awarded in 100 years, that’s astonishing. Now following all the regulatory changes one of the big changes was to reduce the barriers for new entrants.

“The more challenger banks we have, the smaller the market share going forward of the dominant big four, the better it is for everyone. My agenda as a minister is to massively ramp up competition and challenger banking.”

The new Small Business, Enterprise and Employment Bill has new moves to boost transparency for businesses looking for finance. But it also has another key plank of the agenda that Leadsom helped push four years ago.

“When I started here and got elected on to the Treasury Select Committee, the first thing we did was to look at cheques. And at the time volumes were falling off and there was a move to perhaps just get rid of them. Following that inquiry, the banks agreed ‘no, we won’t get rid of them’.

“And here we are four years on looking at a new lease of life for cheques. Absolutely amazingly, the banks have agreed the technology. This is the fin-tech agenda which we intend to be at the forefront of globally.”

Under the plans, people will be able to photograph their cheque and text or email it to their bank, who pay in the sum. The minister says it meets the needs of small traders like window cleaners, but also helps the elderly.

However, Leadsom says she wants the banks to fast-track their two-year plans to introduce the new system. “I’d really like it to be faster. My call to the banks is don’t let’s leave it two years.” The Treasury will now call for plans to be ready within a year instead.

One area where Leadsom was critical of Treasury policy as a backbencher was over the Help to Buy scheme. But she no longer believes that the scheme’s house price cap should be lowered from £600,000 to £350,000, pointing out that 95% of the scheme applies outside London, where national prices are much lower. “So actually you don’t need to change things unless it’s a problem. Overwhelmingly, it’s achieving its aspiration of helping people to get their first home.

“With my correspondence I get many more letters from people saying ‘I’m desperate to get a mortgage, why have you done this mortgage market review?’ rather than people saying ‘oh, you know, property prices are ridiculously high’.”

And are those letters as a minister or as a constituency MP?  “As a minister. Well, it’s both because everyone else’s correspondence comes to me if it’s on Help to Buy. So I get everyone’s letters, it’s so nice!”

Key to the Economic Secretary’s role is promoting the City overseas and she says the recent deal with China to make London the global centre for offshore remnimbi trading was “fantastic”. And only this week she opened the Stock Exchange to mark the listing of the first-ever Sharia-compliant bond outside the Islamic world.  “We are ahead of Luxembourg, which at the moment has a certain ring to it,” she says, smiling.

The reference to Jean-Claude Juncker’s birthplace is a nice cue for the other arena where the Treasury is trying to boost the British case: the EU. As a founder member of the Fresh Start Group of MPs, Leadsom has more interest than most in the topic of getting a reformed Brussels, with deregulation and competition her main priorities.

But if the EU fails to reform, would it be worth being outside the bloc?

“That is for a time in the future. Obviously [if there’s] a nonsense reform that doesn’t achieve anything, then it might be. But at the moment I’ve spent four years working extremely hard trying to find things that would make it worth staying in.”

Changing the City’s culture on women is another Government aim, not least through its targets for numbers of female board members. Mining giant Glencore Xstrata has just announced it will no longer be the only FTSE 100 company without a woman on its board. But have the Square Mile and Canary Wharf changed their tune on sexism more broadly?

“All I can say is my 10 years in the thick of the City, compared to my four years in Parliament, I would say Parliament is a million times less sexist, less misogynist, more egalitarian. People here make a real effort. People laugh at the Tea Room chat, but that’s nothing compared with how the City was. But I left the square mile in ‘97 so it’s a long time ago. I think things are a lot better.”

For Leadsom, the equation is simple: more diversity means better business decisions.

“To me it’s just ridiculous to not have a diverse range of views and people. If you want to know what life’s like on the front line, ask someone who’s been there. And if you want to know what life’s like as a working mum, trying to juggle the school run and the cleaning and the Sunday roast, then ask a mum.”

She stresses that diversity isn’t simply about gender. “That’s not just about women and men. That’s about different age ranges, different ethnicities, you just need a diverse range of views.”

But the minister recalls a Westminster Hall debate earlier this Parliament when Helen Grant quoted the chairman of a board explaining why he didn’t hire women. “He said ‘we all think the same way and we all look at things the same way and we always agree and we never have any arguments’.”

Although assiduously loyal to George Osborne (“In case you were asking, George and I get on really, really well!”) Leadsom herself has never been afraid of an argument, not least on issues affecting her constituents. One such big issue is HS2. Does she still back the voters locally and is she hoping for more conveniently timed Brussels meetings when the bill is next voted on?

“On HS2 I’m absolutely firmly committed to getting decent compensation and mitigation for my constituents and I think there’s a long way to go yet,” she says. “And I’ve petitioned myself on the grounds I think the construction period needs to be more thought through, I think there are certain individual cases of families so badly affected by the route of the line by maintenance loops that they need to be treated as exceptions so I’m completely committed to getting the best deal I can for my constituents.”

She can’t vote against the bill because she’s a minister, but is it possible she may never actually vote for it? “Unfair question…,” she replies, adding: “I have voted against it. I voted against the paving bill.”

Another local cause close to her heart is the Northamptonshire Parent Infant Project (NORPIP), which aims to help parents of children under two to bond better with their offspring to avoid a raft of social, educational and mental health problems later in life.

She says she was inspired to get involved partly by her mother, a trained midwife who was an expert in post-traumatic stress in new mothers, and a similar neighbouring scheme in Oxfordshire.

But she also drew on her own experience as a mother. “When my first son was born I was at Barclays, I was a senior executive, they wouldn’t let me go part-time. I had two miscarriages, I had a bout of post-natal depression,” she explains.

“I don’t want to over-egg it because it didn’t last very long and actually going back to work sorted me out. But I certainly remember the period after my first child being quite traumatic and unlike anything ever before.

“I absolutely understood the problem and over the last 15 years I’ve learnt the solution is in intervening in that peri-natal period and severe depression or domestic violence can have utterly life changing consequences for the baby and many of the ills of ours society, violent crime, homelessness, psychosis, self-harming can be laid at the door of a very bad early start. But so too can a lot of poor mental health, backache, depression, relationship breakdown.”

A mother of three, Leadsom has found fellow women in Parliament eager to take up the cause. But with several female MPs from all parties standing down at the next election, it looks like there will be fewer from the 2010 intake. Why does she think so many are calling it a day?

“I think everyone has their own reasons, I think you could very honourably do five years and call it a day. It used to be that you had a job for life. Now you don’t and actually to stay somewhere for five years in the real world for five years is quite a long time. Equally, for some people they perhaps come into Parliament expecting to do something dramatic and then finding it’s harder than they expected. Other people don’t take to the lifestyle or the hours.”

But Leadsom is an enthusiast for Parliament. “I totally love it, I love the camaraderie,” she says. “I have 16 Conservative female MPs coming round to my flat for dinner tonight. And we are being cooked for by the son of one of my female colleagues. He is cooking for the girls and it’s going to be a right laugh. Thai curry and then something chocolaty.

“Luckily we will be literally saved by the bell because we will have to leave at 9.30 [for a Commons vote at 10pm]. Because there’s only so much trouble you can get up to in that couple of hours,” she says, laughing. “Am I allowed to say that?”

As for her own ‘girl’, she’s very much in evidence in Parliament. Her 10-year-old daughter, who was born at home just hours before that infamous selection meeting in Reading, is often in the Commons meeting up with her mum. "She loves it!" her mother says.

A decade on, Andrea Leadsom is still keen to prove that women in politics ‘can do anything’. And fewer people may think she is ‘off her rocker’ any more.   

 

 

 

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