‘Best in Europe’ is no longer good enough
If there’s one phrase that infuriates Tory radicals more than any other, it’s ‘We’re the best in Europe at . . . ’. The words are used among the bureaucratic establishment as an excuse for accepting the status quo. The logic is that as long as Britain is the best in Europe, then all is well. But this is emphatically not the case. Europe is a continent in decline.
According to work by the Prime Minister’s own office, it is probable that Europe will go from having four of the ten largest economies in the world today to none by the second half of this century. So if this country is to prosper in the years to come, it needs to think about how to compete with China and India, not France and Italy. Being the best in Europe will soon be the economic equivalent of being the tallest mountain in Holland.
The European frame of reference is also threatening the recovery. Thanks to the European Union’s Temporary and Agency Work Directive, by December of this year British businesses will have to give temporary and agency workers the same rights as regular employees when it comes to pay, holidays, sick pay and parental leave for mothers. This will be bad for business. When Tony Blair was Prime Minister, he was so concerned about its effect that he spent huge amounts of diplomatic capital blocking it. But the Brown government, under union pressure, signed up to the directive.
The coalition is now, sadly, preparing to implement this EU directive without any fight at all. Indeed, this Conservative-led government is making a habit of bringing into force Labour’s worst laws, such as this and the equalities act.
There are a growing number of Tories who think that, with the economy in choppy waters, the coalition should either repeal this EU directive or suspend it. Philip Hammond, the Transport Secretary and perhaps the most pro-business voice in the Cabinet, is said to be a particularly vehement opponent of these regulations. Hammond’s worry is that the legislations will wallop the construction sector, which is vital to any recovery.
Hammond, alas, has little support. Britain’s new ambassador to the EU, Jon Cunliffe, for all his reputation as a tough negotiator, seems to have gone native almost instantly and is reluctant to think about how to get round the new regulations.
The government machine maintains that there’s no cause for alarm. Even after this directive is implemented, Britain will still have — yes, you’ve guessed it — one of the most flexible labour markets in Europe.
Many ministers acknowledge that the directive will hurt economic growth, though they add that now is not the time to have an argument about it given that the government is already at war with the unions over public sector pensions. Others say that business, not government, must lead the fight against it. The Chancellor himself has repeatedly urged business leaders to speak out more against the rules and restrictions that are impeding the recovery. But at some point the coalition will need to deal with such job-destroying regulations.
Oliver Letwin and Steve Hilton have been known to end meetings by saying, ‘Well, the only solution is to leave the EU’
This directive is not the only example of the European Union subverting the government’s growth agenda. I understand that EU rules on state aid are neutering the impact of enterprise zones, the coalition’s attempt to stimulate job creation in depressed areas of the country. European laws mean that the maximum tax advantage a business can gain in a year from being in one of these zones is a paltry £55,000.
An increasing number of people in government are being driven to distraction by these EU obstacles. Even the Liberal Democrats in the coalition have taken to moaning about how much extra work Brussels imposes on them. But it is the Tory radicals who are most infuriated. Both Oliver Letwin, the Prime Minister’s policy point
‘. . . and all the creditors were paid in full.’
man, and Steve Hilton, Cameron’s longeststanding political ally, have been known to end meetings by saying, ‘well, the only solution is to leave the EU.’ At least two Cabinet ministers share their view.
It’s not just the Tories on the Treasury bench who are becoming more Eurosceptic. One senior backbencher tells me that he expects a sizeable number of his fellow Tory MPs to vote for Ukip at the European elections in 2012. Among the new intake of Tory MPs, who make up nearly half the parliamentary party, it is accepted that anyone who wants to be elected Tory leader will have to promise to renegotiate Britain’s membership of the European Union and put the result to a referendum.
The downsides of EU membership have been made worse for Britain by this country’s ineffectual approach to dealing with the Brussels bureaucracy. One minister asked Kim Darroch, the UK’s ambassador to the EU, who is soon to become the PM’s national security adviser, when he should object to harmful EU policies. Darroch replied that it was best to do so late in the day.That way the intervention would carry the most weight. But after the minister went around Brussels and talked to figures at the Commission and to his opposite numbers, he found that the opposite was true. The reality was that you had to intervene early or bad ideas gained an unstoppable momentum.
This lack of basic diplomatic savvy can also be seen when the government tries to intervene at a European Union level. British efforts to implement in full the services directive, which would expand the single market to services, have yielded little success. But when Hilton suggested that Britain should campaign over the heads of national government in individual EU countries, to boost support for the directive, Foreign Office officials nearly fell off their chairs in shock.
To date, the extent of the government’s public diplomacy in support of this aim has been a glossy blue and yellow pamphlet called ‘Let’s Choose Growth’, which was sent out to all Britain’s EU embassies. It has yet to shift the argument.
If the coalition simply settles for trying to be the best in Europe, it will do little to halt Britain’s decline. What the Tory radicals have grasped is that the real challenge is not to manage decline better than the rest of Europe, but to equip Britain for an era in which economic power is moving east.
the spectator | 2 July 2011 | www.spectator.co.uk Charles Moore
It is well known that, from next year, tuition fees will rise to a maximum of £9,000 per year. What is less well known is that the loan rates, for most students, will also rise enormously. At present, the rate is 1 per cent over base rate. In future, for those students who hit the higher income threshold of £41,000 a year, it will be RPI plus 3 per cent (i.e., at present RPI, 8 per cent). This is a very high rate indeed (and with severe penalties for early repayment), so high that it is hard to understand why anyone would pay it, since the money could be borrowed more cheaply in other ways. The idea of this rate is that it should be a levy on the better-off to pay for the lower rates (RPI only) offered to those students who end up earning less than £21,000. But of course this works only if students do actually take out the loan. Why should they? Until now, the loan system, though much complained of, has been cheap. If it is to become a government-organised debt trap, that is wrong, and a political disaster.
I n Oxford recently, I took part in a colloquium at St Antony’s College about what, if anything, should be forbidden by law or custom from being said about religion. The other panellists were A.C. Grayling, and Usama Hassan, a brave scientist and Muslim who has had death threats because of his publicly stated belief that evolution is compatible with Islam. What a weird culture we live in, I thought, where for some of our citizens it is actually more dangerous to debate evolution today than it was for T.H. Huxley, also in Oxford, in 1860. But on this occasion, it was not Dr Hassan who had trouble from protestors, but Professor Grayling. We speakers had to be smuggled in by a back route while security guards held the mob at bay. The protest was not about Professor Grayling’s famed atheism, but against his plan to set up an independent New College for the Humanities, with himself as its first Master. What the demonstrators hated was the fact that the New College will demand large fees. The notion has got about that, because education is important, it should not be charged for, or privately provided. If the same principle were applied to food, we should quickly starve. As Prof. Grayling waxed eloquent on freedom of speech, a few of the mob broke through the cordon and banged on the windows of our lecture hall, waving derisive tenners in his direction. As the only participant receiving no threats at all, I began to feel miserably unimportant, and so launched irrelevantly into a defence of foxhunting, hoping (unsuccessfully) to get a rise out of someone.
B ut if we in Britain tend to see Muslim attitudes to God as intolerant, we should recognise that our native views about the treatment of animals are getting more and more fanatical. I have no strong opinion about whether wild animals should be part of circus acts, but I am absolutely sure that it is not the main moral issue of our time. Yet last week the House of Commons debated the subject with the hysterical anger that in Pakistan is reserved for alleged insults to the Koran. So, as a corrective blasphemy, I strongly recommend a new book called How to Watch a Bull-fight by Tristan Wood (Merlin Unwin Books). It is packed with information and photographs about how bullfighting is actually conducted, including the dos and don’ts of the kill. I had not realised until I read it that in recent years the spectacle has become, like the British criminal justice system, more merciful. It has not – obviously — abolished capital punishment, but in 1992 the indulto (reprieve) entered Spain’s taurine regulations for the first time. If either the matador or a majority of the spectators thinks the bull is so splendid that it should be spared as a ‘seed bull’ to protect the casta (spirit) of its breed, then this may be done. Mr Wood’s overall argument for the corrida, now in its last season in Catalonia because of an access of anti-Spanish zeal, is that three million cattle are slaughtered in Britain every year, ingloriously and covertly, whereas the Spanish bull can go to its death proudly and publicly, with ‘the opportunity to have its name written into taurine history’.
B ut back to Professor Grayling’s New College of the Humanities. Although the idea is a good one, the new institution will surely suffer if it is too closely linked with its Master’s famed polemicism. I have an ecumenical suggestion. It is a little known but true fact that the Archbishop of Canterbury is a university. I am not referring to Dr Rowan Williams’s famously wide range of learning. I mean that the Archbishop is a university, ex officio, thanks to a medieval papal decision, nationalised by Henry VIII at the Reformation, that he should have the power to award degrees. This was part of the Pope’s power over all universities, and was a remedy for when people who were important to the Church could not — because of plague, or whatever — get to Oxford or Cambridge to be educated. At present, the role is underused (though Lambeth Degrees, which are mostly honorary, are granted). But now the government is looking for other ‘providers’ of ‘the student experience’. Couldn’t Professor Grayling and Dr Williams go into business together, in aid of the wide, liberal learning in which both of them believe?
You cannot blame people, I suppose, for blocking their drives with electric security gates, but they are a bad sign. The gates make one feel that a neighbourhood does not exist. They are now commonplace in England. We live 50 miles from London, and there are virtually no security gates in our village, but I notice that you only have to go about five miles nearer to the capital for them to become frequent, and 20 miles for them to be everywhere. Is there any way of stopping their spread (apart from reducing crime, which will not happen)? Only, I suppose, by convincing their owners that they have a most depressing effect on property prices.
the spectator | 2 July 2011 | www.spectator.co.uk