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Commons Gallery

WORDS: SAM MACRORY

 

Who would have known that an early morning dip in Lough Erne could have such an effect? The Prime Minister bounded into PMQS, leapt to the Despatch Box, and after that? Well, it all went swimmingly.

He broke protocol to reveal the smallest of reshuffles in the Commons – trade minister Lord Green is being replaced by BT CEO Ian Livingstone – before comfortably slapping down the Labour leader on banking reforms.

Ed Miliband’s response? He wasn’t going to “take lectures from the guy who was the adviser on Black Wednesday”. That prompted Cameron to remind the House – again – that the two Eds once worked for Gordon Brown. “He cannot get over the fact that they presided over the collapse of the banks” the PM jeered as the pair of them traded blows on the merits of their CVs – and careers spent more or less entirely in and around Westminster. The exchange would have had Nigel Farage – no doubt nursing a pint of bitter – shaking his head as he continued to converse with inhabitants on the other side of the village walls.

Back in the Commons, however, Tory MPs were delighted with what they were hearing. Even the usually more awkward ones. Edward Leigh (C, Gainsborough) normally has something unhelpful – from Mr Cameron’s perspective – to say at PMQs, but today he reeled off a list of Government achievements after grudgingly accepting that “one must be grateful on some occasions.” Not least, of course, when acquiring – as the now Sir Edward recently has – a knighthood.

Even Bill Cash (C, Stone) clambered down from his Euro-baiting hobby horse to ask his first non-EU related question for as long as anyone could remember. “What’s that got to do with Europe?” asked a Labour wag. Even the PM seemed baffled by Cash’s new found interest in aid for women in the developing world – a most Cameroonian of subjects?

Graham Brady broke free of the cheering pack by asking the PM a question about the “worry” being caused by plans for HS2. It was a rare note of concern in a chorus of support – though Brady himself was left nodding as Mr Cameron promised some sort of compensation once the track was laid.

Over on the other side of the Chamber, Miliband looked increasingly fed up. The best question of the day had come from a Labour backbencher, with Kevin Barron (Rother Valley) asking about the business interests of Cameron’s darks arts chief Lynton Crosby. But the PM also dealt with that one, boasting that Crosby was busily working out “how we destroy the credibility of Labour”. But, he added, the two Eds were doing a good job of that themselves.

Judging by the scowls on their faces, Labour MPs seemed to agree. Their leader had frozen. He looked like a man in urgent need of a reinvigorating dip in bracing waters. If not, Ed Miliband might find himself dunked in a far less-edifying liquid.

 

Banking on change

As the Parliamentary commission publishes its findings, Lord McFall asks: what’s so special about bankers?

WORDS: LORD MCFALL

Money laundering, forgery, fraud and corruption – if you do the crime, you do the time. It seems that’s the case everywhere other than the banking industry.

That’s one conclusion arrived at after a year on the Parliamentary Commission on Banking Standards examining the standards and culture of the industry.

Why is this industry an off-shore island, seemingly not subject to the normal rules of society? There are a number of reasons for this.

Firstly, these banking giants are too big to fail. They can take as much risk as they like in order to boost their profits and bonuses in the safe knowledge that the poor old taxpayer is there to pick up the bill.

Secondly, the first question Banks ask is – what level of short-term profit can be made? A sales-based culture pervaded, and the banks didn’t consider the customer.

There is no individual accountability at the top of these organisations. Murky, occasionally illegal activities such as Libor rigging could be taking place, but when it comes to the top echelon there appears to exist a “no see, no tell” policy. When the Senior Executives were giving their evidence they seemed more content to come across as uninformed and ignorant of events than knowledgeable. Otherwise they would be admitting responsibility.

All the scandals of banking can be reduced to one – the customer’s interests came last. So how can we ensure that an industry which is crucial to the economic well-being of citizens and communities is transformed?

The PCBS report has no magic prescription – but responsibility of those at the top, for a duty of care to customers, is essential if a proper ethos is to permeate the organisations.

Take the issue of Payment Protection Insurance (PPI). A product which can benefit a select few who find themselves financially covered if they become unemployed after taking out a loan – a very expensive one intentionally sold to the mass market despite repeated warnings. It became the banks profits and bonuses cornerstone until 2009.

The banks overcame the public outcry with their financial and lobbying muscle.

A mis-selling bill of £15bn pounds, with the likelihood of it more than doubling. An equivalent of over £500 for every individual in the UK. Incredibly, one of the Banks’ Chief Executive told us that on PPI the banks were “on the side of the angels”.

The banks needed to own up to this deceit, apologise by writing to their customers and settling the PPI claims quickly and efficiently. Instead we have seen delay, denial and a lobbying campaign from the banks for stricter limits on complaints.

As far as senior pay and rewards are concerned, the industry is way out of line. There is a delusional element to their thinking they are special and worth every million pounds received.

Individual accountability of chairmen, chief executives and boards is essential. This is where the Financial Conduct Authority (FCA) regulator has to toughen up and ensure a named board/senior executive is responsible for each line of the Bank’s activities.

By tackling the still to be resolved ‘too big to fail’ ethos and implicit subsidy from the taxpayer (up to £100bn a year to the banking industry, according to one Bank of England official), remuneration can eventually be brought down to more sensible levels.

The day when a chairman or chief executive receives a ‘Thank you - I trust you’ letter from a customer will be the day when banking has turned the corner.

 

Dialogue

This week Laura Sandys and Lord Steel debate: “Lords Reform: do we really need an elected second chamber?”

From: Laura Sandys

Date: 16 June 2013 19:53

Dear Lord Steel,

I, like you, have stood on our party’s manifestos that promised that the UK’s constitution should adopt a similar shape to almost every other democracy – that all legislators should be elected. And I am sure that you still believe this to be the optimal outcome from any reform.

So would you join me in finding it remarkable that some are still arguing against the principle of direct elections, and that they appear to stand in the way of the electorate shaping their own properly representative Parliament? Others appear to be playing “long-grass” tactics – all too difficult. How about tinkering around the edges just to keep those democratic zealots happy?

I am happy to be described as a democratic zealot. I am also extremely pleased that my desire to have the House of Lords elected was supported by one of the largest majorities I have seen in the Commons.

Would it not be ironic that those who fear that the primacy of the Commons would be undermined by an elected House of Lords, are happy to deny the Commons their overwhelming will on establishing an elected Second Chamber? Is it not time to make the change and ensure that we have a democracy that is shaped and guided by the electorate and not the patronage of a succession of Prime Ministers?

From: Lord Steel

Date: 17 June 2013 18:54

Dear Laura,

We are not all that far apart. I agree that a nominated House is (apart from Canada) an oddity in this day and age, but I am not surprised that the Government’s bill failed in the Commons because whoever drafted it had not done their homework.

My distinguished predecessor as Liberal leader, Mr Asquith, promised a chamber constituted on a “popular” basis, and he set up a large commission under Viscount Bryce which went into the whole subject at length, recommending basically election on a regional basis by the House of Commons. We could do better than that today by including, in addition, election by the Scottish Parliament, the Assemblies in Wales and Northern Ireland, and the MEPs. Such a democratic chamber would not threaten the supremacy of the Commons and indeed the Bryce commission in 1918 rehearsed all the familiar arguments: “it was forcibly argued that a Chamber elected on the same franchise as the House of Commons would inevitably be a rival.....” My own objection to 15-year regionally elected Senators stemmed from my experience as the first Presiding Officer of the Scottish Parliament, dealing with complaints from constituency MSPs and MPs about the activities of regional list Members interfering in their constituencies.

So now we have a chance to get things right, starting with the modest housekeeping measures which I proposed in the Lords and which have now been taken up by your colleague Dan Byles MP, who drew fifth place in Mr Speaker’s ballot and so has a good chance of success.

Yours,

David

From: Laura Sandys

Date: 17 June 2013 20:15

Dear David

Maybe I am wrong but I am not that worried about primacy of the Commons in relation to the second chamber. I am very excited by the fact that greater legitimacy of the second chamber would not take power from the Commons but strengthen Parliament as a whole in relation to Government, which is where the imbalance really lies. I see our Parliament as one place with two chambers, I also see too little co-operation and communication between the Houses, that if it functioned better would further enhance the powers of scrutiny.

I would however support your bill if we could add to it one key reform that would kill patronage and ensure that the House of Lords was full of committed legislators. Would you consider decoupling titles from membership of the legislature? I am sure that this singlehandedly would put a big break on patronage and would immediately separate the men from the boys and the ladies from the girls! We would ensure that those who wanted to be active members of the legislature would be clearly there to do a job, and those that wanted a “handle” wouldn’t need to continue the charade of being a member of a Parliament. It might suit us all!

So how about lots of MLs rather than M’Lords...

All my best wishes

Laura

From: Lord Steel

Sent: 18 June 2013 10:10

Dear Laura,

Well you may not be troubled about the primacy of the Commons, but it was a recurring theme in the debates in both our Houses as well as in the joint committee which examined the Government bill, and in the 1918 commission. The second chamber should not have financial powers nor veto powers over the Commons. We are a revising chamber only. I agree with you that there should be more co-operation between the two Houses and perhaps more joint committees. The Steel Bill (now the Byles Bill in your House and the Hayman Bill in ours) contains clauses unanimously passed in the Lords to give us power over a retirement scheme and expulsion. I would like to have seen more powers to end cash for peerages scandals which have afflicted all three parties (possibly with more to come shortly!) and an end to hereditary peers’ by-elections, which make the rotten boroughs like Old Sarum seem respectable in comparison. I hope you will back the bill pending more fundamental reform.

Yours,

David

From: Laura Sandys

Date: 18 June 2013 18:08:14

Dear David

We must get to a fully or almost fully-elected House of Lords as soon as possible. While I know that your reforms are very worthy we cannot constantly duck the fundamental issue of elections and legitimacy through the ballot box. If we had an elected House, the two Houses would need to work much more closely together, doubling capacity rather than duplicating. We would have to develop complementary agendas and truly ensure that both chambers were effective at both revision and scrutiny of Government. Rather exciting in my view.

If we had elections we would not need a retirement process as the electorate would be the ultimate arbiter of whether someone was too old or too crooked to stand. So this bill, while well intentioned, seems to be unnecessary use of Parliamentary time if we are to properly reform the House of Lords in the next few years. This bill will not eradicate the fundamental and indefensible flaws of a legislature that is not democratically elected and is hobbled by not just the whiff of patronage.

I know that we share a similar ultimate goal. It is just that I am ambitious to reach that common goal sooner rather than later.

All my best wishes

Laura

From: Lord Steel

Date: 19 June 2013 11:49 AM

Dear Laura,

You say we must get to it as soon as possible, but both the 1968 and 2012 efforts came to grief and so next time they must get it right. After the Scottish referendum next year goes down (as I predict it will) – and bearing in mind Welsh Assembly demands for greater powers – there is a real chance to develop a democratic upper chamber which reflects the whole of the UK as I suggested earlier. One criticism of the present House is that it is too London-centric. Meantime we really need some tidying-up measures as my guess is that your “soon as possible” will be many years off. So do back the bill being promoted by your colleague Dan Byles. Far from being a waste of parliamentary time, it tackles two vital needs – our ability to draw up a retirement scheme within our own budget to get the numbers down from what will shortly be over 800, and to give us the same powers as you already have in the Commons to eject from Parliament those who have seriously misbehaved.

We must meet to discuss further!

Best wishes,

David

Byrne After Reading

As well as planning how Labour will ‘rescue’ flagship Tory projects, Shadow Work and Pensions Secretary Liam Byrne has been busy bakin...

WORDS BY PAUL WAUGH, PICTURES BY PAUL HEARTFIELD

Liam Byrne hands over a plate of buttery shortbread cake, beaming with pride. “You’re going to have to shove some down you, you know. It’s totally delicious.” The home-made Breton gateau is the product of his own fair hand, proof that the Great British Bake-Off has pervaded even the loftier heights of Westminster life.

But as he sits in his top-floor office in Portcullis House, the Shadow Work and Pensions Secretary looks surprisingly trim for someone who scoffs fattening French fancies. The clutch of sports medals on his coffee table reveals another new-found hobby that offers the explanation: as well as baking, he’s also taken up triathlons. Last week he did the Stratford running-cycling-swimming event, next month he’ll tackle the Birmingham race.

Whether it’s creating calories or burning them off, it seems that even in his ‘downtime’ Liam Byrne just can’t sit still. And aptly enough perhaps for the man who oversees his party’s welfare policy, Byrne is a self-confessed workaholic.

The former Cabinet minister jokes that Ed Balls is not the only chef on his frontbench now. Yet he’s deadly serious about how he and the Shadow Chancellor have to cook up the key policies needed to give Labour the credibility needed to win an outright majority in 2015.

Byrne’s new book on China, Turning To Face The East, is a rough blueprint for how the UK can pull its socks up and trade its way to growth. Part travelogue, part manifesto, it’s about harnessing British innovation with Chinese scale.

Yet how did he find time to write it?  “I’ve been visiting China for about five years. Most of it has been done on weekends and holidays, but I write very fast,” he explains. “There are big chunks of it written on a Blackberry.”

“When you are not working 16 hours a day, which is what I used to do as a minister, then you have time. And I’ve always worked seven days a week.” He smiles: “My wife says it keeps me quiet”.

The Birmingham Hodge Hill MP once wrote an infamous ‘Working With Liam Byrne’ memo while at the Cabinet Office, a Maoist missive that also included the lovely line ‘Never put anything to me unless you understand it and can explain it to me in 60 seconds’. So, can he sum up his new book in just a minute?

“Yes, very easily,” he says, with the confidence of a former McKinsey consultant. “How is Britain going to pay its way in the Asian century? The balance of world power is shifting. Britain is in a difficult state right now. Just like after the Second World War, we’ve got to trade our way back. Given the difficulties in Europe and America, we’ve got to get on with turning East. And Britain could do really well in China but right now others are overtaking us. And so what we’ve got to do is think about what does China need to succeed over the next 10-20 years and we’ve got to think about how we can help make the China dream possible. I think we can play a big role and I think it can lift us back onto our feet in Britain.” He beat even his own target: that summary took just 40 seconds.

Byrne also says that it’s time to be crystal clear about Britain’s colonial legacy, especially when young Chinese refer to episodes like the Opium Wars. When asked how exactly UK politicians should respond, he replies: “By being honest about it. And being careful about coming across as preachers who don’t know enough about their own history.”

“For example, we will be far more effective making the case for human rights, democracy and the rule of law in China, which need to improve dramatically, if we come across as a country that has made mistakes in the past but has kind of repented. Sometimes the Chinese have listened to us and said ‘you know, you show too little awareness of your role in what we call our century of humiliation’. They know our history often much better than we do.”

Byrne says that multi-party democracy will “one day” happen in China, though “I don’t know when that day is”. “If you look at what happened in Britain in the 19th century, real political pressure began to build once we became a country that on the whole lived in cities. And that’s what’s going to happen in China over the next 10-20 years. China will become an urban society and history tells us that’s when pressure for political reform becomes unstoppable and China knows that. That’s why the reformers in the system are beginning to put such a big emphasis now on the need for transparency and crucially the need for rule of law.”

He stresses repeatedly that given China’s clout, now is exactly the wrong time to be querying Britain’s membership of the EU. If Labour won power in 2015, would it want to risk staging and losing an In-Out referendum? And wouldn’t it give the Opposition a superb stick with which to beat a new Government? “It would all be very high risk, that’s the point. At a point when our economy is in the tank, can it be a priority now? Surely it can’t be. Putting our membership of a free trade club in jeopardy, that isn’t going to help, it’s going to hurt.”

Byrne’s book also reveals some more detail on his life in Government and it has a fascinating passage about how he and Treasury civil servants picked up in 2009 the real problem of the ‘squeezed middle’.

Led by Simon Gallagher, now one of the economic team in the British embassy in Berlin, a special four-strong team of officials drafted a document that spotted that the rot had set in back in 2005, well before the financial crisis. “The Treasury had a secret name for it. It was called the Future of the English Working Class,” Byrne reveals. For families on median incomes, real disposable income grew at a neglible 0.14%. The Treasury found that from 2001-2008, UK productivity rose 9%, but workers’ share in national earnings fell 73% to 69%.

But although his Treasury wonks picked up the phenomenon of squeezed incomes, it’s still unclear exactly what caused it back in 2005. “Nobody knows. This is the big mystery because it gets a lot worse in the States about the same time and it’s something that hits Western Europe at about the same time. But for those of us on the left this is one of the great unanswered questions.”

“A couple of odd things happen at about the same time. There is huge inward investment. Europe doubles in size. China really begins to pick up its growth rate. Lots of things are happening in the global economy at about this time. Quite why living standards begin to stagnate is hard to know.”

He says one explanation came from Cambridge economist Peter Nolan, namely the huge increase in global company mergers that gathers pace after China joined the World Trade Organisation in 2000. “What they are doing is building their high tech stuff in Western countries and their low tech stuff in cheaper countries. That means an unskilled worker in Britain now competes with someone paid 90% less elsewhere. That means that if you are now an unskilled worker you are more likely than not to be out of a job. Some 52% of unskilled workers are out of work in Britain today. These things have got to be linked. I just think globalisation happened much faster than we expected.”

Byrne presented the findings to Cabinet in 2010 just before the general election but it got buried. “We picked it up too late,” he says. “It was very late in the day, is the truth. A number of us knew that it was too late to do anything about it before the election, but lots of us said ‘we need to show that we get it, we need to be finding ways of speaking to this group of people that’s been hit so hard’.

“And of course we didn’t during the election campaign. We had the Gillian Duffy incident that was a kind of prism through which many of these debates were refracted – and when the results came in our vote amongst C2s had dropped by 20 points, the biggest fall in British political history. And those voters made up one in six of half of the seats we lost. I think this is absolutely one of the things that lost us the election.

“Which is why I was so pleased that Ed Miliband picked up the Squeezed Middle narrative. And since then has comprehensively rebuilt Labour’s trust among this group so now C1s and C2s are now majority Labour voters. And crucially, at the last election, overwhelmingly this group of voters said Labour didn’t know what it was like to be an ordinary working person and Ed Miliband has just turned those ratings around. It’s an incredibly important achievement.”

But isn’t it true that Labour’s soft poll lead shows it is not the only party to have picked up on voter unease and anger on this issue, and that parties like UKIP have made inroads where the Opposition should be?

Byrne replies: “As we move into the final straight towards the next election, people say ‘ok we hear what you say about today, how would you be different after 2015?’ And that’s why last week [the announcements on welfare and the deficit] was so important.”

“We are now shifting into an argument about the future not the present. We started to clear the ground last week, we’ve got a lot more to do over the next couple of years. Some of the fiscal decisions are going to have to come quite late in the day because every time we see George Osborne in the House of Commons, the budget picture gets worse and worse – it’s like a bad movie on fast forward.”

One Conservative attack line for 2015 is already clear as everyone from the PM down declares that the Labour Party is now ‘the Welfare Party’. But Byrne insists: “I’m determined to make sure welfare reform is an election winner not an election loser for Labour at the next election.”

Byrne says that much of Labour’s policy stems from feedback on the ground as he toured the UK since the election. And the idea of a contributory system, with more for those who pay in more, has proved very popular.

“People right now are frustrated as hell because they feel they pay a shed load of tax and national insurance in and they get bugger all back out when they need it. What people say is ‘look, if we stopped paying money to people who didn’t need it, there would be more to help those who did need it’. So I’m afraid what we are going to have to do is to say ‘well look there do have to be some tough edges’.”

Those ‘tough edges’ now include what Byrne calls “Ed Miliband’s triple lock on welfare”: a cap on the amount of time you can spend on the dole, a household benefit cap and an overall cap on social security spending.

Byrne praises fellow Labour MP Simon Danczuk, who wrote recently of the need to admit that some people on the dole were ‘swinging the lead’ and some having children to maximise their benefits. “Simon Danczuk cut right through by giving a very honest and candid account not only of his own upbringing but what he sees in Rochdale. I represent the constituency in Britain, Hodge Hill up there [he points at a map on his wall], with the second highest unemployment in the country. All of our work in the constituency is in one way or another about getting people back to work.

“So what we see clearly is that there are a tiny minority who could be doing more and need to be confronted with some tough choices but there are far more people desperate for work, hungry for work and just shut out and let down by the system.”

Ed Balls got into trouble when he said the welfare cap had to include a curb on pensioner spending. Does that show the pitfalls of trying to prove your economic credibility?

Byrne is unabashed: “We’ve got to show we can be radical with power and realistic about money. That’s the absolute key. People are looking for both, that’s the truth. The big mindshift is to get into long-term reform.”

One Big Reform being run by Iain Duncan Smith is of course the Universal Credit. Ministers claimed in May 2011 that the IT system for the mammoth project would be complete by autumn 2013. But Byrne has just got back some answers to Parliamentary Questions that suggest the deadline of this year has been abandoned. The PQs state only that “plans continue to be developed to support [its] gradual rollout”.

He also reveals that senior sources from amongst the five firms working on the half-a-billion pound contract to deliver the Universal Credit IT system have confided that work has been called to a halt and hundreds of IT staff stepped down. On 24 May, Universal Credit was given an “amber-red” rating by the Cabinet Office, a category designating a project in danger of failing and that “successful delivery of the project is in doubt”.

Byrne says: “Universal Credit was supposed to be a flagship but it’s becoming a car crash. It appears to be being operated with an abacus and a calculator and a quill in Thameside [where one pilot operates]. Every time we get answers back from a question about Universal Credit, it just recedes over the horizon.

“And we are now beginning the think about how do we put together the rescue plan for Universal Credit. We are talking to our colleagues in local government, we are talking to people in industry, we are gearing up to really get inside the implementation of Universal Credit because it’s a good idea in principle but a dog’s breakfast in practice and we know we are going to have to rescue it.”

Byrne reveals he’s also looking at how to ‘rescue’ another flagship IDS project.

“We are doing work on the Work Programme 2.0 now. We have just sent quite a big document out to Labour local government over the last couple of weeks asking them for their views on how we radically localise DWP, based on a lot of research we have done in Canada and Germany over the last few months. In Canada and Germany and Australia you have got back-to-work programmes which are far more localised and we think that’s a good idea. We want to get inside how do we do that in Britain.”

But IDS believes in localism doesn’t he? “When he made his first speeches in Easterhouse, that’s precisely what he said. He then drew up one of the most Stalinist contracts that we’ve got in central government. People in local government are getting tired of it now. Let’s think about how we put schools, colleges, universities, councils and DWP on one team making a difference on the ground.”

Would that involve private sector too? “Definitely, definitely. We have great relationships with the welfare to work industry, who are also frustrated. A lot of them are thinking of not re-competing for the Work Programme because it has just not worked. The point is we are getting into a lot of those detailed planning discussions now. We are determined to be ready for government.”

Despite his optimism and enthusiasm, some Labour MPs have questioned Byrne’s commitment to the front bench after he last year threw his hat into the ring to be Mayor of Birmingham. The voters rejected the idea of a directly elected Mayor but Byrne is unrepentant. He says that far from annoyed, Ed Miliband encouraged him.

“He was a huge supporter. The personal support that he gave me was hugely important and impressive and I will always be grateful to him for that.”

Byrne also says the episode crystallised his own belief that you have to ‘seize the day’ when opportunity arises. He points out he grabbed the chance to become an MP largely because of his public service ethos.

“I had a great career in business, I was very happily running the dotcom I had set up after I came back from business school. I wanted to come into politics because I was taught by my parents that you had an obligation to make a difference. Both my parents were in public service: my dad was manager of a local council and my mum was a science teacher. They were the biggest influence on me.”

He then adds a poignant note to underline why he believes in grabbing opportunities like the mayoralty. “When my mum died of cancer at the age of 52, as a family we were taught a very harsh and brutal lesson, which is that you don’t know how long you’ve got and if there is something you want to do in life you need to get on and do it.”

One suspects that Byrne’s mother would have been proud of his baking skills and the way it binds his young family. “Baking is a big love,” he says. He was given Annie Bell’s Baking Bible for Christmas and has displayed the zealotry of a convert ever since. Despite his workaholic nature, Opposition means “having more time with my kids, so we bake together on Saturdays or Sundays”.

And there’s one other change that hints at a slightly more relaxed approach to life, thanks to a radical reform of his own personal ‘work programme’. He admits he’s dropped the infamously strict instructions to staff that involved getting him a soup by 1pm and an espresso at 3pm.

“The ‘soup regimen’ has been abandoned,” he smiles. “These days I have to buy the coffee. I’m buying coffee and baking the cakes.” 




BYRNE ON…THE ECONOMY

“I think people know the crash caused the deficit. The deficit didn’t cause the crash. I think we can hold that line because it’s the truth.”

 

 

BYRNE ON… TEACHING CHINESE

"Mandarin is not an easy language…It needs to be much earlier. Why wouldn’t you start at primary school?”

 

 

BYRNE ON…QUITTING THE EU

"The idea that country of 60m can suddently wander into the mix and go to the front of the queue with special privilieges is fantasy frankly."

 

 

BYRNE ON…'THAT NOTE' TO DAVID LAWS

“It was a very foolish thing to do. [But] I felt disappointed that some very old conventions had been cast aside for political advantage.” 

 

 

BYRNE ON….HS2

“Let’s be blunt. High speed rail is great for Birmingham but the plan to put the marshalling yard in Washwood Heath [in his constituency] is crackers.”

The third sector man

Minister for Civil Society Nick Hurd talks charities, community spirit and ‘chumocracies’

 

WORDS: DANIEL BOND

 

Ask most MPs about their first experience of Westminster, and they’ll recount a daunting affair; the majestic buildings, the grandeur, the labyrinthine estate, the sense of pride, or even the shattering weight of expectation. Nick Hurd remembers the biscuits.

But then again, Hurd’s first walk through the corridors of power came earlier than most. He received his political baptism while still at school, after his father Douglas (now Lord) Hurd was appointed political secretary to Ted Heath. Four years later, the elder Hurd was elected MP for Mid Oxfordshire – the third generation of his family to sit in the Commons.

“I was dragged in. I remember sitting on the sofa in my dad’s office, and the Prime Minister walking in being dumbstruck at me sort of rooted there. I was young, 10 or 11, eating biscuits on the sofa and in walks the Prime Minister. He didn’t know what to do,” Hurd the Younger recalls when asked about his earliest memories of Westminster.

“I remember the day dad was elected,” he continues. “I remember elections, being dragged around with my dad, and eating all the biscuits in the branch of the constituency party.”

But, biscuit access aside, growing up the son of an MP can be tough. Growing up the son, grandson and great-grandson of an MP is almost unprecedented. 

The Hurd name ranks alongside the Benns and the Spencer-Churchills as one of the most prestigious and enduring in British politics. The eldest Hurd, Sir Percy, was first elected in 1918, with his son Anthony entering Parliament in 1945. Douglas completed the Hurd hat-trick in 1974.

For someone whose name was so entwined with the history of Parliament, surely it was only a matter of time before Nick entered the family business?
“When I was growing up I had no idea what I wanted to be, but I knew what I didn’t want to be – a Conservative MP,” he replies, when quizzed on his childhood ambitions.

The life of political progeny is “not particularly easy”, he continues, with a hint of melancholy.  

“You don’t see as much of your mum or dad as you would like. It’s not the ideal environment for bringing up a family.

“I guess in a way that led me into thinking I want something else.”

Of course the Civil Society Minister did become a Conservative MP. So what transformed this one-time refusenik into a fully-signed up member of the Hurd dynasty?

“I turned 40 and the public service ethic kicked in,” he explains. “I’d spent 18 years in business, five years of that building a business in Brazil, had a fantastic time, but actually just felt it was the right time to start working for other people.

“I guess that was always in me. I probably knew it was always going to get me in the end. But I wanted to go into politics having done something else.”
He finally made the leap in 2005, successfully standing in the Tory safe seat of Ruislip-Northwood. While not seen as part of David Cameron’s innermost circle, Hurd quickly came to be regarded as an ally of the Tory leader, and in late 2008 was handed responsibility for one of his most cherished projects – the Big Society.

Like the Prime Minister, Hurd was educated at Eton College before attending Oxford University and joining the exclusive and bibulous Bullingdon Club. Unlike David Cameron, who has previously expressed embarrassment over his membership of the controversial clan, Hurd remains tight-lipped. “It’s not an issue I’m remotely interested in,” he replies when asked about his education.

Accusations of a Downing Street Old Boys’ Network, or ‘chumocracy’, have resurfaced in recent weeks after Cameron brought Jo Johnson and Jesse Norman, two fellow Eton and Oxford alumni, into his Number 10 operation. But Hurd scoffs at the idea of a unique Cameron cabal, pointing out that prime ministers have been promoting allies and like-minded souls for decades.

“Prime ministers, or leaders of parties, have always surrounded themselves with people that they trust. There’s always that instinct. Whether it be Margaret Thatcher’s ‘one of us’, or whatever,” he says.

“I think that’s human nature. I think every prime minister I’ve known has been accused of that. But I’ve seen no evidence in my dealings – I’m in and out of Number 10 a lot – and I’ve seen no evidence of that. I’ve seen no signs of a ‘chumocracy’.”

But does he think persistent speculation about a Cameron ‘public school clique’ is damaging the Conservatives’ reputation? Even Tory MPs seem to be getting concerned, with David Davis using a Daily Telegraph interview last month to urge: “Please, no more Old Etonians.”

“I don’t judge anyone by where they went to school,” Hurd replies. “I know our political opponents try to make something of it. But ultimately you’re judged by what you do.

“The fundamental issue facing British politics is the public don’t trust the politicians. The only way you might build trust is by what you get done – what you do and what you achieve. I think my experience of the British public is that that’s much more important than where someone went to school.”

The Charity Minister’s approach to private schools has not been without its detractors, however. His defence of fee-paying schools, and the charitable status they receive, brought him into conflict with the former head of the Charity Commission, Dame Suzi Leather.

As commission boss, Leather was accused of pursuing a ‘class war’ against independent schools after demanding they provide more services to the poorest children or face losing their status – which is thought to bring them tax benefits worth more than £100m a year.

Hurd was instinctively uncomfortable with the campaign, he says, suggesting Leather had sought to politicise the commission.

“I thought they were too prescriptive in terms of the fences that independent schools needed to jump in order to get their approval. In my experience, a lot of independent schools do a lot of very good things that justify public benefit and it’s best to do that in a not too prescriptive way.

“I thought it would be very difficult for the Charity Commission to sustain an approach that was proactive in picking targets – there was always the suspicion that it was politically motivated…which, whether or not it was, was a problem.”

The minister envisages a smoother working relationship with Leather’s replacement, the former journalist and writer William Shawcross. A fellow Old Etonian, Shawcross appears ideologically closer to Hurd on the issue, having used his first appearance before MPs to argue that it was up to the schools themselves to decide on the public benefit they offer.

The Royal biographer was a controversial appointment, with some Labour MPs questioning whether such an “outspoken figure” should be trusted in the sensitive role. He has certainly endured an eventful first few months – just last week Public Accounts Committee chair Margaret Hodge questioned whether the commission was even “fit for purpose” after the Cup Trust tax avoidance scandal. But, Hurd argues, the appointment could not have come at a better time.

“The poor guy, he’s come into a baptism of fire. He’s had Cup Trust, and the Plymouth Brethren issue. But sometimes you need these sort of big, external, catalytic events and situations to give you the space to look at things completely afresh, which is what I think he and the new board will do.”
Hurd admits the Cup Trust scandal was a “shocker”, which must act as a wakeup call for regulators. But the minister is quick to deny Hodge’s claim that the revelations are simply the “tip of an iceberg” which could damage the entire charitable sector.

“I think it’s an opportunity to look at things with fresh eyes. The Charity Commission has obviously got to review all its processes and make sure that it is fit for purpose, and is equipped to do the difficult job as well as it can,” he explains. 

“I’ve got no evidence that there is an iceberg underneath the water there. What I do see is we’ve got new leadership in the Charity Commission, we have a lot of faith in William, he’s got a new board now.

“What we have said, right from the start, is we expect it to really hunker down on its core regulatory role. I think in the past it’s been distracted by other work, and we want it to hunker down on the core regulatory role, and make sure it gets its relationship with the HMRC right so that we don’t get any more Cup Trusts.”

Hurd is optimistic about the state of Britain’s charities, believing Shawcross and his new board have inherited a third sector in far better shape than anyone could have imagined just three years ago.

The minister admits he had some “private concerns” about the vulnerability of the sector when he entered Government in 2010, fearing the squeeze in public spending and living standards would hit charities hard. But, the impassioned Hurd says, the country has instead experienced a “magnificent human response” to difficult financial times.

“It was clear we were going to go through a period of austerity, not just in terms of public finances, but everyone’s financial circumstances...No one knew how the public was going to respond,” he recalls. “Actually what we’ve seen, according to the official statistics, is that giving is stable. Which is frankly magnificent, under the circumstances. And volunteering, rather than falling, has actually risen, quite sharply.

“There may be lots of reasons working underneath the surface – but I think actually those two things are just a magnificent human response to difficult times. I think lots of people out there are rolling their sleeves up and thinking ‘how can I help? how can I get involved?’”

The minister, who has retained responsibility for David Cameron’s Big Society idea since its infancy, is determined to help communities take advantage of this growing enthusiasm. He appeared alongside the Prime Minister at a social investment event last week, where they unveiled a new £250m fund to help communities take over facilities threatened with closure.

While Hurd denies this was another Big Society relaunch – “I know the press always love to call any Big Society event or speech a relaunch, but it wasn’t” – he says it proves the Government is serious about the project and committed for the long-term.

“The Prime Minister, looking at the G8 opportunity, presumably had a long menu of options to choose from, and he decided that he wanted to put social investment on the agenda. Why? Because we’re the world-leaders in developing this idea that you can mobilise capital behind a simple proposition – that you can invest for the common good, and get your money back.

“The flagship of that is Big Society Capital, the world’s first social investment institution. It’s investing, it’s committing money. So this has moved beyond vision and pipe dream and speeches into investments of time and money and partnerships that are actually making a difference. It’s early days, but I can see clear momentum.”

He admits the Big Society has drawn “its fair share of flak” over the years, but says businesses are now champing at the bit to get involved as the project takes shape on the ground. So how big can the Big Society be? Will we see community-owned pubs in every town in Britain?

“We’re seeing more and more community-owned shops, libraries, pubs, whatever it is. But it needs financing, and it needs financing on affordable terms. That’s the gap that Big Society Capital and Big Lottery want to fill.

“The scope of that could be very big, but it’s just one subsector of a much bigger opportunity if we can prove that you can invest, for a measurable social impact, and get a positive financial return.  Because if you can do that, we will move a lot of money into the social sector and transform the funding environment.” 

Hurd retains his man-on-a-mission enthusiasm for the project, and his commitment is clear. But last month marked four-and-a-half years since he was first handed the charities brief in opposition. So with the Big Society idea firmly off the ground, and rumours of a summer reshuffle on the way, is he itching for a fresh challenge and a change of scenery?

“I’m feeling more enthusiastic about this brief than I did when I started. I’ve done it for a long time, in opposition and now in Government. I’ve always been a very strong supporter of the Big Society vision and would love the chance to see it through,” he says, before adding:  “But, when you’ve been exposed to politics as long as I have, you know the vagaries of these things.”

The minister has indeed been exposed to politics longer than most. But with his father and grandfather both making the transition to The Other Place after long stints in the Commons, this is one Westminster dynasty we may be hearing from for some time yet.

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