Councils plan for exodus of poor families from London.

London boroughs are booking bed and breakfast lodgings in Hastings, Reading and Luton as London prepares to see some 82,000 families forced to leave the city because of George Osborne's changes to housing benefit. London is about to see an exodus of the poor from the city.

The controversy follows comment last week by Iain Duncan Smith, the work and pensions secretary, who said the unemployed should "get on the bus" and look for work. Another unnamed minister said the benefit changes would usher in a phenomenon similar to the Highland Clearances in the late 18th and early 19th centuries, when landlords evicted thousands of tenants from their homes in the north of Scotland.

Honestly, only a Tory could bring up the subject of the Highland Clearances and imagine that he is being witty when making a comparison with present day Tory policy.

In a sign that housing benefit cuts are fast becoming the most sensitive political issue for the coalition, Jon Cruddas, the Labour MP for Dagenham, last night accused the government of deliberate social engineering.

"It is an exercise in social and economic cleansing," he said, claiming that families would be thrown into turmoil, with children having to move school and those in work having to travel long distances to their jobs. "It is tantamount to cleansing the poor out of rich areas – a brutal and shocking piece of social engineering," Cruddas added.

The National Housing Federation's chief executive, David Orr, described the housing benefit cuts as "truly shocking". He said: "Unless ministers urgently reconsider these punitive cuts, we could see more people sleeping rough than at any stage during the last 30 years."

This is almost a textbook re-run of what we witnessed under Thatcher. Until she became Prime Minister, the sight of people sleeping rough in London was a relatively rare one. Under Thatcher, it became an almost routine vision.

Now the Tories have, once again, launched a savage attack on the poorest members of society and are introducing policies which will see many of them unable to afford to live in the capital.

There are rumblings of discontent amongst the Liberals, but it won't amount to naught. Power has, seemingly, removed their teeth.

Simon Hughes, the Liberal Democrat deputy leader, said last night he would table amendments to change housing benefit rules. He said: "I would fully expect to be one of those putting forward proposals for changes in the housing benefit rules, particularly for London."

But, as always when the Tories are in power, the middle class will remain largely unaffected by the chaos which they are dealing out to the poorer members of society.

This will play out on their TV screens as stories of the random poor. Eventually, they will tire of it and flick channels.

That's, certainly, what the Tories and Liberal Democrats are hoping for. As it's not as if they haven't been warned of the results of what they are about to do.

At a meeting of the Commons work and pensions select committee last Wednesday, the day Osborne announced £81bn of cuts in the spending review, MPs were told by London council chiefs that the housing benefit cuts could have devastating results.

Nigel Minto, head of sustainable communities at London Councils, who works closely with the capital's housing directors, told the committee that since June London councils had been "procuring bed and breakfast accommodation" in outer London and beyond. The committee was told similar problems would occur in other cities with high-priced property such as Brighton and Oxford.

Jeremy Swain, chief executive of the homelessness charity Thames Reach, said he was particularly worried about the impact on numbers sleeping rough in London. "We have reduced rough sleeping dramatically and we have a target of zero rough sleeping in London by 2012. For the first time I'm thinking that we will not achieve that," he said.

Karen Buck, shadow minister for work and pensions, said: "The sheer scale and extremity of the coalition proposals means almost a million households are affected across the country."

The truth is that the Tories don't care. I honestly have come to believe that they loathe the poor. It's the only rational explanation for the way they behave each and every time they gain power. They are simply shockingly oblivious to the pain they are causing.

But last night Cameron insisted the cuts were tough but fair. "Departments have to make savings. I don't underestimate how difficult this will be. But we are doing what we are doing because it is the right thing to do – right by our economy, right for our country."

Because it would obviously be "wrong" to ask those of us who could afford it to contribute more in taxation. That would, to the mind of a Tory, be insane talk. The Con-Dem coalition plan to wipe out the deficit by raising 23% by taxation and 77% from benefit cuts. That statistic alone says all that needs to be said about their priorities.

Click here for full article.

Tags: Con-Dem coalition, Osborne, Clegg, Cameron, housing benefit

Spending review cuts will hit poorest harder, says IFS.

It normally takes the Institute of Fiscal Studies longer than twenty four hours to work out whether or not a budget has been progressive or regressive, but, in the case of George Osborne's latest offering, no such time was necessary.

Osborne, backed by Nick Clegg, has made the ridiculous claim that the rich would carry the burden of this budget much more than the poor. It was a silly claim at the time when they made it, and the IFS has wasted no time in identifying what we all recognised when Osborne was making this silly claim.

Detailed analysis by the IFS undermining the government's case is expected to put intense pressure on Liberal Democrat ministers in the coalition who have stressed the need for tax rises and spending cuts to be progressive.

The chancellor, who acknowledged that his package of £81bn of cuts had involved "hard choices", insisted yesterday that they are fair and would be borne by "those who have the broadest shoulders".

But the IFS said that with the exception of the richest 2% of the population earning more than £150,000 a year, the less well off would be proportionately the hardest hit, with families with children the "biggest losers".

Carl Emmerson, the IFS acting director, said: "The tax and benefit changes are regressive rather than progressive across most of the income distribution. And when we add in the new measures announced yesterday this is, unsurprisingly, reinforced.

"Our analysis continues to show that, with the notable exception of the richest 2%, the tax and benefit components of the fiscal consolidation are, overall, being implemented in a regressive way."

The IFS have also poured scorn on Osborne's claim that his cuts of 19% across all governmental departments is less than the cuts Labour would have implemented.

The IFS challenged Osborne's claim that the government's cuts to those departments whose budgets were not protected averaged 19% compared with 20% implied by Labour's plans.

It said the Osborne's figures failed to take into account the £6bn of cuts already announced by the government this year while the actual figure under Labour would have been 16%.

All in all, the lies told by both Osborne and Clegg have been exposed with almost record speed. That's not really very surprising, as the distance between what they claimed and the truth is actually gargantuan.

Clegg, for reasons I could never work out, kept making the bizarre claim that the cuts would create a "fairer" and "more democratic" Britain. How he imagines punishing the poor brings this about was always lost on me.

The IFS also criticised plans to scrap council tax benefit and replace it with a system of locally administered council grants. It said that it would create a "postcode lottery", providing an incentive to councils to award grants in a way that encouraged poor families to leave the area.

"The incentive it provides to local authorities to encourage low-income people to move elsewhere is undesirable," Emmerson said.

The IFS findings are most damning for Clegg, who continues to insist - to anyone who will listen - that this budget is "fair" and "democratic". As I said a few days ago, I have absolutely no idea what measurement Clegg is using when he makes those claims. But him saying that something is "fair" and "democratic" doesn't make it so. The IFS appear to concur that conclusion.

As the IFS were briefing reporters about their conclusions, both Nick Clegg and David Cameron were answering voters questions in Nottingham. And Clegg was sticking to his script that this budget was fair and democratic.

Fairness was "literally the question I have been asking myself every single day of this very difficult process we have been going through", the deputy prime minister said.

"I honestly would not have advocated this if I didn't feel that, notwithstanding all the difficulties, we tried to do this as fairly as possible.

"Of course I understand people are very, very fearful, and fear is a very powerful emotion and it kind of sweeps everything else aside.

"But I would ask people to have a little bit of perspective: if you look at some of the announcements we made yesterday, and add that to some of the announcements we made in the budget, I think the picture is a little bit more balanced than people are saying."

Clegg appears to think that by securing a pupil premium and protecting overseas aid - both admirable things in their own right - that he has somehow kept the budget "fair" and "democratic". But that's the problem with coalition politics, one is always left celebrating the fact that things could have been much worse than they actually are.

The rest of us simply look at the budget - as the IFS has done - as it actually is. And what we see is a regressive budget which attacks the poor, the old and the disabled. It's a disgrace. And the Liberal Democrats should shudder that they were part of the government which produced this travesty. It goes against everything which they claim to believe in. And the IFS have dismissed Clegg and Osborne's claim that it is fair and democratic with almost record speed.

It is not. And that fact should now be beyond doubt. The country's leading tax and spend think-tank have made their view on this abundantly clear.

UPDATE:

Clegg has decided to embark on some cognitive dissonance. The facts are simply too unpleasant for him to deal with.

Nick Clegg, the deputy prime minister, has taken the highly unusual step of attacking the respected Institute for Fiscal Studies, describing its methods of measuring the fairness of the coalition's controversial spending review as "distorted and a complete nonsense".

That's a classic case of "shoot the messenger".

UPDATE II:



Clegg and Cameron attempt to win over a sceptical audience, and fail. Support for the Liberal Democrats is now at a twenty year low.

As I have said ever since he joined this Con-Dem coalition, he is leading his party to oblivion. He will never be forgiven for this.

Click here for full article.

Tags: Institute for Fiscal Studies, Osborne, Clegg, Cameron, Con-Dem coalition, budget

Spending review axe falls on the poor.

I know it's just me, but I found it quite sickening to watch Nick Clegg pat George Osborne's back as he sat down having announced his brutal spending cuts.

Osborne was as smarmy and self pleased as he always is, as clear a product of the upper end of Britain's class system as one is ever likely to see, taking obscene pleasure in removing vital benefits from people in need.

Outlining his long-awaited comprehensive spending review, which will cut £81bn from government spending, Osborne vowed to restore "sanity to our public finances and stability to our economy". Perhaps the most striking of the new cuts announced was a package of £7bn in extra welfare cuts on top of the £11bn already made in the last budget. This will include the withdrawal of £50 a week from the million people claiming incapacity benefit for more than a year.

In a rapid-fire speech to the Commons, Osborne slashed £350m from the legal aid budget, reduced the police budget by 20% over four years, and hacked two-thirds off the £9bn communities department budget, including more than halving the support for social housing over four years. The pension age will rise to 66 from 2018.

Rail fares will be allowed to increase by 3% above RPI inflation from 2012, higher education spending will be cut by 40% – £2.9bn – by 2014/15, and flood defences by 15%. Further education will be cut by £1.1bn by 2014/15 and the "poorly targeted" education maintenance allowance for 16- to 19-year-olds is abolished.

And, most sickening of all, he then reduced the entire process to an Oxford debating society game, by announcing that the extra £7bn savings on tax credits and a range of other welfare benefits had enabled him to limit the overall reductions in the budgets of Whitehall spending departments to 19% over the next four years – less than the 20% pencilled in by the Labour chancellor, Alistair Darling.

If that wasn't an example of pathetic schoolboy one-upmanship, then I don't know what else it could possibly be.

For months he spoke of the need to cut these departments by between 25 and 40%, only, in the end, to play a game where he could score the cheapest of points against his rivals. And that tactic was only made possible by further slashing benefits needed by the poor, the old and the disabled.

Alan Johnson did well to point out the obscenity of what we were witnessing.

"We have seen people cheering the deepest cuts to public spending in living memory," he said. "For some people opposite this is their ideological objective. For many of them, not all of them, this is what they came into politics for."

And that, I think, is what I found the most obscene about the entire process. Had they announced these cuts in a sombre mood one might have deduced that we were witnessing what Osborne has always claimed, a government having to do something because there was no alternative. But what we witnessed was a Conservative celebration. Conservatives cheering to the rafters as they deprived benefits to the incapacitated, and slashed money for social housing. It was quite a sight. To see people actually cheering as they celebrated the loss of 490,000 public sector jobs over the lifetime of this parliament.

And the myth that the deficit will be paid on the shoulders of Britain's highest earners was exposed as the lie it always was. It is the poor, the disabled, the unemployed and the old who will be asked to suffer the most.

Taking the measures one at a time, the first – and the biggest – was to "time limit contributory employment and support allowance" for one year, that is the benefit formerly known as incapacity benefit. What this means is that a disabled or seriously sick person who has a working spouse, however low-paid their job may be, will lose their personal entitlement to benefits after a year.

Singles will be able to fall back on a means-tested safety net, but everyone else will be forced to rely on the generosity of their partner. Expect wheelchairs in Downing Street as the coalition does away with the long-established principle that people who have contributed their own national insurance in the past, and then become sick and disabled, should expect a modest stipend from the state in recognition of this.

On housing benefit, already savaged in June, there was a move to link the maximum rents paid for council and housing association properties to the market rent, something which will further encourage the cleansing of the poor out of central London.

This is what his Conservative colleagues were applauding. Reducing the savings credit, which rewarded pensioners who had saved from seeing their income support entitlement removed pound by pound to, in effect, punish them for their prudence.

How that fits in with the Tory philosophy is simply beyond me, especially as he went to such lengths to placate the equitable life savers of Middle England.

But, as much as Osborne and the rest of them will harp on about the reductions being 19% as opposed to the threatened 25% or 40%, one thing is worth remembering: these are the most brutal cuts in public spending in Britain since WWII.

And they do risk - the loss of 490,000 jobs in the public sector alone highlights the risk - of a double dip recession.

Those who oppose Keynesian economics, as Osborne clearly does, are pinning all their hopes on the Confidence Fairy.

Advocates of austerity believe that mystically, as the deficits come down, confidence in the economy will be restored and investment will boom. For 75 years there has been a contest between this theory and Keynesian theory, which argued that spending more now, especially on public investments (or tax cuts designed to encourage private investment) was more likely to restore growth, even though it increased the deficit.

The two prescriptions could not have been more different. Thanks to the IMF, multiple experiments have been conducted – for instance, in east Asia in 1997-98 and a little later in Argentina – and almost all come to the same conclusion: the Keynesian prescription works. Austerity converts downturns into recessions, recessions into depressions. The confidence fairy that the austerity advocates claim will appear never does, partly perhaps because the downturns mean that the deficit reductions are always smaller than was hoped.

It was brutal, and there is every chance that it won't work, and yet that was what caused Clegg to reach out his hand and pat Osborne's back as he took to his seat.

That moment truly made me wince. Because it shows that Clegg is not, as some have unfairly suggested, making deals for the sake of achieving political power. He is a true believer. He rejects Keynesian policies as vigorously as Osborne does.

My problem is that I think both of them are terribly wrong. And I fear we will all pay for their mistakes. And no-one, despite the claims of Osborne and Clegg, will pay more in the short term than the poor, the unemployed, the old and the disabled.

Watching Conservatives applaud that yesterday, and watching Clegg pat Osborne's back to celebrate his cruelty, are about as sickening a thing as I have ever seen on the floor of the Commons.

UPDATE:

It's well worth reading Johann Hari on this:

George Osborne has just gambled your future on an extreme economic theory that has failed whenever and wherever it has been tried. In the Great Depression, we learned some basic principles. When an economy falters, ordinary people – perfectly sensibly – cut back their spending and try to pay down their debts. This causes a further fall in demand, and makes the economy worse. If the government cuts back at the same time, then there is no demand at all, and the economy goes into freefall. That's why virtually every country in the world reacted to the Great Crash of 2008 – caused entirely by deregulated bankers – by increasing spending, funded by temporary debt. Better a deficit we repay in the good times than an endless depression. The countries that stimulated hardest, like South Korea, came out of recession first.

David Cameron and George Osborne have ignored all this. They have ignored the warnings of the Financial Times, the newspaper most critical of their strategy. They have dismissed the warnings of Nobel economics laureates like Paul Krugman and Joseph Stiglitz, who have consistently been proved right in this crisis. They have refused to learn from the fact that the country they held up as a model for how to deal with a recession – "Look and learn from across the Irish Sea," Osborne said – has suffered the worst collapse in the developed world. They have instead blindly obeyed the ideological precepts they learned as baby Thatcherites: slash the state, and make the poor pay most.

It's simply never, ever worked before. And yet Osborne, Clegg and Cameron insist that this time it will.

It can't be coincidental that this is being done to us by three men – Cameron, Osborne, and Nick Clegg – who have never worried about a bill in their lives. On a basic level, they do not understand the effects of these decisions on real people. Remember, Cameron said before the election: "The papers keep writing that [my wife, Samantha] comes from a very blue-blooded background", but "she is actually very unconventional. She went to a day school." Osborne is a beneficiary of a £4m trust fund he did nothing whatsoever to earn and which is stashed offshore to avoid tax. Clegg actually thought the state pension was £30 a week, a level that would kill pensioners.

These attitudes have real consequences. We're not in this together. Who isn't in it with us? Them, their friends, and their families.

UPDATE II:

There are two stories in today's Independent which really do perfectly highlight the Tory mindset.

The first tells us that Tory whips had actually warned MP's not to look too happy when Osborne announced the cuts:

Tory MPs had been told by party whips not to cheer the cuts too loudly. The message was that the cuts were a grim necessity, not something to enjoy or do with ideological zeal.

What does it say about the Tories that their own whips actually have to warn them not to look too happy as they make 490,000 people unemployed? And, worse, when they find themselves unable to comply with such a request?

Then tucked away inside is this gem:

The Queen is set to become one of the wealthiest crowned heads in Europe after the future of the British monarchy was secured in a historic deal with the Government that will give the House of Windsor a share of the £210m profits from government estates relinquished by George III.

The Civil List and the parliamentary system for funding the head of state are to be abolished, and from 2013, the Queen will receive her funding directly from the Crown Estate, which owns £6bn of British land and business. The deal means the Queen, and her successors, will not have to dip into her private wealth to help fund her crumbling palaces and staff wages, reducing financial concerns for Prince Charles when he ascends the throne, and potentially leaving him with a vast income.

Nice to know, as Clegg, Cameron and Osborne are so fond of telling us, that we are all in this together. He actually announced this in the same speech in which he took away billions in people's benefits.

Click here for full article.

Tags: Osborne, Clegg, UK politics, recession, austerity packages, public cuts

Clegg struggles to contain his party's 'guilt by association' with Coalition cuts.

Nick Clegg has lost his bloody marbles.

Nick Clegg, the Deputy Prime Mini-ster, yesterday tried to calm jitters among Liberal Democrat MPs about the impact of the cuts – not least on the party's own electoral fortunes. He said: "The spending review provides the best evidence yet of why we are in government – and that we are delivering on our priorities."

He appears to think that the "gains" which he has wrestled from the Tories...

Mr Clegg, who beat off a Treasury attempt to end 15 hours of free child care for all three- and four-year-olds, trumpeted Liberal Democrat "gains" in the spending review – including a £2.5bn-a-year "pupil premium" for children from disadvantaged families; protecting spending on health, overseas aid and infrastructure projects; radical welfare reform; and delaying a decision on whether to renew the Trident nuclear missile system.

... are, in some way, a price worth paying for half a million job losses.

Welcome as the pupil premium and spending on overseas aid is, does Clegg seriously think this will have any impact on the public psyche as Osborne wields his blade across a wide range of public services? Does he seriously think people will say, "Well, it could have been worse, we could be without the pupil premium?" Or, "Thank God they have delayed the decision on Trident!"

Clegg and the Liberal Democrats will be remembered as the co-authors of one of the most brutal assaults on the state in living memory.

And they will be viewed much more harshly than their Tory counterparts because they campaigned on the very opposite of what they are now backing.

In a high-risk strategy, Mr Clegg urged his MPs to share ownership of the cuts, describing them as a "Coalition process and Coalition product".

Admitting that the review involved difficult decisions, he insisted: "These are the right decisions to build a fairer and more liberal Britain."

I've yet to work out on what basis Clegg thinks cuts on this scale make Britain "fairer" or "more liberal". What does he mean by that?

It's simply not fair that the poorest members of our society should pay more of a price than the banking community for a crisis caused by their greed; nor is it, in any way that I can measure, more "liberal".

Indeed, it's hard to think of anything less fair and less liberal than asking the poor to pay for the mistakes of the country's wealthiest bankers.

As I say, Clegg has simply lost his marbles. He appears to think that him saying that something is "fair" and "liberal" makes it so. But the rest of the nation has eyes, we can see what is happening. And Clegg's rampant bullshit won't blind us to what he has signed up to.

He has sold his party - and the people who voted for him - down the river. He should be ashamed of what he has done.

Click here for full article.

Tags: Nick Clegg, Con-Dem coalition, Tories, Osborne, spending cuts

Spending review: day of cuts begins with raid on BBC.

Today, we finally learn what Osborne is actually going to do. For months they have been hinting at it, telling us to brace ourselves, and now, finally, Osborne is going to reveal just what it is that he is proposing.

There are hints of what is to come:

Average budget reductions of 25% to most Whitehall departments are expected alongside welfare cuts, following months of negotiations with ministers.

Reports suggest nearly 500,000 public sector jobs will go by 2014-15.

On Tuesday 8% cuts to the defence budget were outlined separately in the strategic defence review.

Overall 42,000 jobs - in the Ministry of Defence and in the armed forces - are to go by 2015.

Half a million public sector jobs will go. How does it help avoid a double dip recession if one adds that many people to the dole? That's half a million less people with the power to buy things, half a million more people claiming unemployment benefit.

Osborne will claim today that what he is doing is "unavoidable", but that is simply tosh. He is doing what he is doing for ideological reasons; because the Tories have never favoured the notion of a large state and the financial crisis is giving him the perfect excuse to do what the Tories have always wanted to do: Slash state spending.

He has also made life extremely difficult for one of Rupert Murdoch's greatest enemies: the BBC.

Haggling over the deepest public spending cuts since the second world war has culminated in the BBC being forced to accept a 16% budget cut that will see its licence fee frozen for six years and the corporation taking over funding of the World Service from the Foreign Office.

The negotiations left the BBC stunned, with insiders claiming that a licence fee settlement that would normally take years to thrash out had been imposed in three days. The extra financial burdens are equivalent to the cost of running the BBC's five national radio stations.

What does freezing the BBC's licence fee for six years have to do with the current financial crisis? Why, nothing, of course. But this is too good an opportunity for Osborne to pass up. After all, the licence fee is paid by the public, it costs the government nothing, but freezing it for six years will greatly please the Murdoch's and make life much more difficult for Murdoch's greatest British rival.

I spoke this time last year about Cameron's plan to help Murdoch:

What it will mean is that the BBC's income will be capped, without the regional television companies seeing any government help, which will strengthen the market position of Britain's only satellite television company, Sky. "This was done for News International," a Tory insider said yesterday. "Murdoch wants Sky to go head to head with the BBC. He doesn't want the independent companies strengthened."

And now he starts to do Murdoch's dirty work for him, all the while pretending that what we are witnessing has something to do with the financial crisis; when, in fact, nothing could be further from the truth.

Cameron promised to hobble the BBC over a year ago and he has today made good on that promise, but it has bugger all to do with the financial crisis because the BBC's fee is paid directly by the public. Again, we see ideology masquerading as financial prudence.

David Cameron had pledged in the general election to protect the pensioners' free TV licence fee. The BBC fiercely resisted taking responsibility for the cost, saying it was an open-ended drain on BBC resources, but this morning succumbed to demands that it take on the cost of the BBC World Service and the Welsh language channel SC4 from 2015.

It also confirmed the BBC will take responsibility for the rollouts of broadband and digital radio, and accept a six-year freeze in the £145 licence fee until 2016-17. The total cost is a minimum of £340m by 2014-15.

What could possibly suit Murdoch more than "an open ended drain on BBC resources"? Cameron has frozen the BBC's income for six years and imposed a further cost of £340 million on their expense sheet. It's a very good day for Rupert Murdoch's empire. It's a very bad day for the BBC. Cameron today repays Murdoch for the support his party received from The Sun.

Click here for full article.

Tags: Cameron, Osborne, BBC, Rupert Murdoch, Shy News

Social housing budget 'to be cut in half'.

David Cameron is to slash the social housing budget in England by 50% and to change - for the first time ever - the right of tenants to a house for life.

Ministers are expected to introduce a "flexible tenancy" for people who move into council housing for the first time.

Tenants will be checked over a period of time to see if they still require help with housing from their local authority, the BBC has learned.

In August, Prime Minister David Cameron suggested tenants in England should get fixed-term contracts and be encouraged to move into the private housing sector if their finances improve.

He said greater flexibility was required within the social housing system, allowing tenants to move to find work.

But Lib Dem deputy leader Simon Hughes said his party was against the idea, which was not coalition policy.

Labour accused Mr Cameron of threatening the long-term stability people value from secure tenancy.

I would have thought that this might cause a huge rift between the Conservatives and the Liberal Democrats but I am so used to the Lib Dems lying on their backs and showing their bellies to the Tories that I suspect nothing will happen.

A party which enjoys huge support in university towns has already ripped up it's promise to abolish tuition fees and now plans to allow them to be doubled, despite the fact that most of them, including all five Lib Dems in the coalition cabinet, signed a pledge promising to oppose any rise in fees.

I feel sorry for the Lib Dems. They are basically decent people who Clegg has allowed to be turned into Cameron's cannon fodder.

They now appear to be backing Cameron's insistence that council tenants can be forced to rent in the private sector once their earnings reach a sufficient level. Forget how well you get on with your neighbours, forget any sense of community and belonging which someone might feel for the place where they live, Cameron will now insist that certain people move on simply because they can afford to.

And it won't surprise me that the Liberal Democrats, led by a man who is a conservative in all but name, will dutifully follow along behind. It's shameful to watch what Clegg is doing to that party.

And the public appear to be waking up to what is about to happen:

Most voters expect the poor and elderly to bear the brunt of David Cameron's savage cuts, an exclusive Sunday Mirror poll has shown.

Fifty-six per cent of those quizzed in our survey said the Government's welfare benefit cuts would hit the "poorest, elderly and most vulnerable" the hardest. Just 28 per cent disagreed.

Nearly half - 46 per cent - said Cameron understands the needs of the rich better than the concerns of ordinary people.

A similar number feared that the loss of hundreds of thousands of public sector jobs is too high a price to pay to slash Britain's deficit. Just 30 per cent of people asked agreed the job losses were a "price worth paying" against 47 per cent, who disagreed.

It seems that there is no policy too right wing for Clegg to insist to Cameron that he can't back it. What experience do any of these public school boys have when it comes to council housing?

None. None at all. And yet they are seeking to impose their values on a culture which they simply do not understand.

Click here for full article.

Tags: council housing, Cameron, Clegg, Con-Dem coalition

Rupert Murdoch: no evidence of widespread NoW phone hacking.

Rupert Murdoch, facing questions from shareholders concerning the phone hacking allegations at the News of The World, has stuck firmly to the company line.

Speaking for the first time since the Guardian revealed that News Corp's UK subsidiary had paid more than £1m in out-of-court settlements to three victims of the practice, Murdoch stuck firmly to the company line.

"We have very, very strict rules," he said. "There was one incident more than five years ago ... the person who bought the bugged conversation was immediately fired. If anything was to come to light, and we have challenged those people who have made allegations to provide evidence ... we would take immediate action."

He has also dismissed the recent investigation by The New York Times into the allegations.

"Journalists who have been fired or unhappy or who are now working for other organisations I do not take as authority."

He added: "I don't take the New York Times, who are the most motivated in this, as authority."

The investigation by the British police has been somewhat undermined by the fact that the officer in charge of the inquiry, assistant commissioner Andy Hayman, subsequently left the police to work for News International as a columnist.

And there are reports that the police ignored huge amounts of evidence.

Police who investigated the phone-hacking scandal at the News of the World obtained previously undisclosed telephone records which showed a vast number of public figures had had their voicemail accessed – and then decided not to pursue the evidence, according to official papers seen by the Guardian.

The revelation – contained in paperwork from inside the Crown Prosecution Service – raises fundamental questions about the behaviour of Scotland Yard, which has claimed repeatedly that it found evidence of "only a handful" of people whose mobile phone messages had been intercepted by the News of the World's private investigator, Glenn Mulcaire.

The paperwork also reveals that police and prosecutors adopted a deliberate strategy to ringfence the evidence which they presented in court in order to suppress the names of particularly prominent victims, including members of the royal family. The existence of this strategy has been omitted from all public statements, including evidence made to the House of Commons media select committee.

It may well be that The Guardian and The New York Times have got this utterly wrong, but my instinct is to believe them before I believe Rupert Murdoch, especially as Murdoch claims not to have even read The New York Times article in question.

He can hardly be said to have seriously looked into this if he hasn't even bothered to read the allegations which are being made against his newspaper.

But then, how seriously can you take someone who says this?

He also defended the company's decision to donate $2m to the Republican party, insisting it was "in the best interests of the country".

"In the case of these two donations we judged it to be in the best interests of the company," said Murdoch. "It had nothing to do with editorial policy or journalism ... or anything else. We believe it is certainly in the interests of the country, shareholders and prosperity that there is a fair amount of change in Washington."

And do the shareholders have any say about Murdoch donating this amount of their company's funds to the Republicans?

Asked whether shareholders would be consulted he emphatically responded: "No. You have the right to vote us off the board if you don't like it."

And he says this whilst supposedly promoting democracy....

When the truth emerges, my money is not on this guy having gotten it right.

Click here for full article.

Tags: Murdoch, NoTW, phone hacking, New York Times, Guardian

No knockout, but the Ed corner celebrates a PMQs points victory.

Ed Miliband's first PMQ was important because he was not elected by the majority of his own parliamentary party, so it was important that yesterday didn't end with a feeling of buyers remorse.

And, whilst I could pick holes all day at his stilted delivery, there can be no question that he won the battle on points.

Searching for Mr Cameron's weak point, the Labour leader decided to go hard on the decision to withdraw child benefit from higher rate taxpayers. He described last week's announcement as a "shambles" and, reflecting the political zeitgeist, not "fair".

Mr Miliband wanted to know how many stay-at-home mothers would lose out. When Mr Cameron didn't offer an answer, the Labour leader played a prepared card: "I may be new to this game, but I thought I asked the questions and you answered them."

Awarding the Prime Minister "nought out of two on straight answers", he said: "We should try to change the tone of these exchanges, but he must provide straight answers to straight questions." Later he deployed the best joke of the session, saying the child benefit announcement at the Conservative Party conference had been such a mess that Mr Cameron must have wished that the aborted BBC strike had gone ahead.

The Prime Minister's pre-cooked lines were less effective. Welcoming Mr Miliband to his new perch, he hoped that he would stay there for "many years to come". But it wasn't a new gag. George Osborne, the Chancellor, had used it against Mr Johnson the previous day.

Jubilant Labour MPs toasted their new leader in the Commons bars last night. But old heads knew not to get too carried away. "One session down, only four and a half years until the election," one quipped. They also knew that Mr Cameron would not underestimate his new opponent again.

My favourite moment was when he quoted Cameron stating that he "liked" child benefit and wouldn't change it at an event billed as "Cameron Direct".

It's early days, but he made a good start. He punctured the notion that Cameron is a straight talker. Cameron plays on this a lot, and it's simply not true.

Click here for full article.

Tags: Ed Miliband, David Cameron, child benefit

Benefits feel the squeeze – but the City doesn't.

The Tories have always been in favour of a smaller state, and that is reflected in the cuts which they are making. However, the Tories are determined that the cuts they wish to impose must never be seen as ideological, which is why they are now insisting that the cuts are the result of financial necessity, and that Osborne has no choice other than to indulge in the kind of brutal austerity which he is doling out.

It strikes me as odd that fate has been kind enough to hand the Tories the type of task that they have always relished carrying out, and made it a matter of necessity to boot. So, according to their script, they get to do what they have always wanted to do, but - Heaven forfend - it's not their fault.

Oh, that life would be so kind to the rest of us.

Yesterday, Osborne scrapped child benefit for families where one member earns more than £43,875 and put a cap on the amount any family can claim in benefits at £26,000. I don't think anyone could argue against high income families losing a child benefit which they don't really need, especially at a time of recession, but there is a slapdash manner to the way Osborne has done this which is troubling.

It admits the shake-up will create anomalies: a two-earner couple both on £40,000 a year will keep their child benefit, while a family with a single earner on £45,000 will lose theirs. The benefit is worth £20.30 a week for the first child and £13.40 for each subsequent child. So one-child families who lose out will be £1,055 a year worse off and those with three children £2,500 worse off.

Of course, Osborne will, once again, claim that necessity has tied his hands. And it is certainly true that it is many of his own supporters who will pay the price of this cut. However, what Osborne is really attacking here is the principle at the heart of Britain's welfare system; that some benefits, especially benefits for children, are universal and not subjected to means testing.

Osborne will willingly take the wrath of his own party in order to tear down that Labour ideal.

I expect there to be some discontent amongst the Liberal Democrats in the coalition, but Clegg will, of course, support anything which is fiscally right of centre.

Critics said it undermines the principle of universal benefits locking the middle classes into the welfare state. It also contradicts pledges made by David Cameron, Mr Osborne, Nick Clegg and Vince Cable in the run-up to the May election.

Mr Clegg endorsed yesterday's change but there are signs of a backlash from the Liberal Democrats, whose conference two weeks ago voted to retain child benefit as a universal payment. Bob Russell, MP for Colchester, told The Independent: "If I have an opportunity to vote against it, I will. I support universal child benefit. It is a guarantee for the child because it is paid to the mother."

This is all happening at a time when the banks - the section of the populace who created this financial disaster - are, according to the Centre for Economics and Business Research, enjoying bonuses this year in excess of £7 billion.

Which sort of renders Osborne's words to the conference as empty rhetoric:

"We will not allow money to flow unimpeded out of those banks into huge bonuses, if that means money is not flowing out in credit to the small businesses who did nothing to cause this crash and suffered most in it."

But the money is flowing out. £7 billion of it.

Which brings me back to my original point. This isn't about financial necessity, although a necessity exists, this is purely ideological.

There are billions of pounds flowing into the arms of the people who caused this mess whilst Osborne attacks the middle class - his own supporters - in order to destroy a principle which Osborne vehemently disagrees with.

He's entitled to loathe the principle of universal benefits, and he's entitled to attempt to destroy that principle. I just can't bear the fact that he is being so dishonest about what he is doing. He is hiding behind the claim of necessity, when the riches flowing around the city show that there are other places he could raise money if that was his true priority.

He wants to attack and reduce the welfare state but lacks the courage of his convictions to make an argument for doing so. Instead, he hides behind the claim of necessity.

Thatcher would never have displayed such cowardice. She would have told us what she was doing and why she was doing it. And she would have loved the fact that we loathed her for it.

Osborne lacks her courage and honesty. He's dismantling the state, and hiding behind the flimsy excuse that he has no other choice. When it's clear to all that there are lots of other choices.

Click here for full article.

Tags: Osborne, Conservative party conference, child benefits

John Rentoul: If Ed is a gift to Dave, he's a Trojan horse.

We've all read how delighted the Tories are to be facing Ed Miliband rather than his brother David.

Now John Rentoul - Blair's biographer of all people - is warning Cameron that, if Miliband is a gift, then he is a Trojan bloody horse.

We know two things about how the general public will view the early clashes between Cameron and Miliband. One is that they know next to nothing about the new Labour leader; the other is that they tend to give a new face the benefit of the doubt. Cameron finds himself in a similar position to that of Tony Blair when, as Prime Minister, he faced his fifth and last Conservative leader.

Cameron's own arrival at the despatch box to which Ed Miliband will step up next Wednesday prompted furious discussion in Blair's office and between Blair and Brown. Blair took a "wait and see" approach, feeling his way to Cameron's weaknesses, sizing up his new opponent. Many Blair advisers, having read books about American politics, knew that it was a priority to "define your opponent before he can define himself", and urged him to paint Cameron as a Thatcherite, Norman Lamont's adviser and a public relations man.

Brown agreed with them. The most vivid image from the House of Commons in those days was of Brown almost pulling at Blair's arm, his body language shouting: "Let me at him!" But Blair understood the danger of seeming too nasty about his untested foil. When Brown got the chance, he called Cameron a "salesman", which came across as elitist, and then tried the "playing fields of Eton", which backfired because people thought Cameron was polite.

It is being reported elsewhere that Cameron is planning to use the term "Red Ed" as a rallying call for the Conservatives. I find this idiotic. It might be a nice piece of alliteration, but it is nowhere near the truth, and the public won't be so stupid as to accept it as such.

Indeed, Cameron's worry should be that, as the cuts become painful and real, Ed Miliband might be speaking out for an awful lot of people when he states that Cameron's coalition is going in too hard and too quick.

Mr Cameron attacked Mr Miliband's move to the left of both Tony Blair and Gordon Brown after backing tax rises while delaying action to reduce the deficit. The stance left "a massive gaping hole of credibility in his entire approach", the Prime Minister told the The Sunday Telegraph.

It follows a claim by the Chancellor, George Osborne, that Labour had made a "historic mistake" in electing Mr Miliband: "They have chosen to move off the historic centre ground of British politics. He is a man without a mandate or an answer to the deficit, and that makes him weak."

This appears to be the new Tory strategy; to portray Miliband as having "no answer to the deficit", rather than simply having a different answer than the one they are committed to.

This is okay as long as cuts to reduce the deficit are merely something which we are all talking about; but this will change once the severity of the Tory cuts becomes clear.

At that point Miliband's calls for less severity will start to resonate with an awful lot of people.

Who is to say that a Labour leader with a basically leftish tilt, against a coalition finally making deep cuts, is going to be unpopular? Who is to say that he doesn't face a strategic opportunity at the next election, when that coalition includes the Liberal Democrats, who have an "itch to switch" to working with Labour? Not just because they feel an ideological closeness but because they want to stay independent by avoiding being glued to one party for too long.

One of the most intriguing things about Cameron's speech this week is how he will deal with Ed Miliband, a box marked Handle With Care.

The Conservative approach to Miliband so far has been an extremely childish one. Cameron can please his base with name calling this week, but the public won't like it, any more than they appreciated Gordon pointing out Cameron's public school past.

Miliband represents a serious threat to the Tories. His position in a new poll confirms this.

A YouGov/Sunday Times poll last night put Labour ahead on 41 per cent with the Tories at 39 and the Lib Dems on 11.

That's no gift to the Tories. And it's idiocy to think that you can sell it as such.

Click here for full article.

Tags: Labour, Conservatives, Cameron, Miliband

Wanted for genocide... and as a trading partner.

I well remember the contempt in which the Tories held Robin Cook when he had the nerve to suggest that Britain's foreign policy should be ethical. He was widely ridiculed.

But, contrast that with the foreign policy example being set by William Hague.

The Government is courting the regime of the indicted war criminal Omar al-Bashir by declaring that relations with Sudan have entered a "new epoch". The announcement came as Britain welcomed a trade delegation from the country which has near pariah status, for the first time since warrants for President Bashir's arrest were issued by the International Criminal Court (ICC) in The Hague, over atrocities in Darfur.

Khartoum's high-level delegation met British government officials and business leaders on Wednesday to encourage investment in a country still targeted by US sanctions. It was the clearest example yet of how problematic William Hague's new foreign policy, in which commercial interests are to trump ethical concerns, will be for the Coalition to implement.

Business people attending have been told that Sudan is full of "untapped natural resources" and that there was "a lot of money to be made" there.

The pursuit of such friendly ties leaves the Coalition partners open to accusations of hypocrisy. While in opposition the Tory party called Darfur the "world's worst humanitarian crisis" and senior officials including Mr Hague, the current Foreign Secretary, and Andrew Mitchell, now the International Development Secretary, backed the campaign to get UK companies to disinvest from Sudan.

In a foreign policy advisory in 2007 Mr Mitchell wrote of the need to "change national and international business behaviour in the face of manifest gross violations of human rights".

But last night a Foreign Office spokesman insisted that British companies were "free to pursue legitimate commercial opportunities in Sudan", adding that "increased trade would benefit" the country's people. He said that there was "no question of prioritising commercial links over the very real and pressing human rights concerns".

I preferred the foreign policy intentions of Robin Cook. When we find ourselves dealing with suspected war criminals, I think we are guilty of putting money before principle.

Click here for full article.

Tags: William Hague, foreign policy, Sudan

Morale boost for Ed Miliband as poll gives Labour first lead in three years.

In and of itself, it's almost meaningless, but I note it nevertheless.

Ed Miliband ends his first week as Labour leader with his party ahead of the Tories in a Guardian/ICM poll for the first time since Gordon Brown ducked the chance of holding an election in 2007.

It's important only because it undermines Blair's claim that the party could not move a millimetre to the left of New Labour without courting disaster.

Ed Miliband is clearly somewhere to the left of his brother - the clear New Labour candidate - and yet is being given a cautious welcome by the public.

And, as I expected, the results are in many ways fuelled by public reaction to the coalition's planned cuts.

The poll also shows that the public mood is swinging against the scale and speed of spending cuts, with 43% now saying the cuts have gone too far compared with the 37% who think the balance is right. By contrast, in July 39% thought the balance right, and 38% said too far.

And all of this is happening before a single cut has been implemented.

Once Osborne actually starts to make cuts of between 25% and 40% I fully expect their to be outrage across the political spectrum. As I have always said, these are percentages which he has plucked from his ass. It's simply impossible to impose a cut of 25% on any public service without reducing it to a shadow of it's former self. And that's looking at his proposed cuts at the lower end of his scale.

Imagine the impact of a 25% cut on something as simple as your local bus service. One in four buses gone, the packed insides as more and more passengers are forced to cram in together. Now apply that to all other public services. Imagine the police force deprived of a quarter of their effectiveness. Imagine the strikes which are sure to break out when Osborne tries to impose these savage cuts across the board. We are already seeing house prices plummet in reaction to what Osborne has proposed, so it does not surprise me at all that Ed Miliband has seen a rise in the polls before most people even know what he stands for. People know that he does not favour cuts on the scale which Osborne proposes and that appears to be good enough for now to ensure that people consider giving him a chance.

All of this is taking place before a single cut has been implemented. Once they are implemented, I fully expect chaos to take place.

And, as expected, Labour's gains are made largely at the expense of the Liberal Democrats.

There has been a shift of opinion in Labour's favour since May, with support up almost eight points at the expense of the Lib Dems. Almost one in four people who voted Lib Dem are now thinking of voting Labour instead.

Once the reality of what Clegg has signed up to becomes apparent, and people re-read his comments stating that benefits should not be there 'to compensate the poor for their predicament', I fully expect there to be a progressive exodus from the Liberal Democrat party.

The right wing newspapers have nicknamed him "Red Ed", but I think Miliband has positioned himself perfectly to counter the economic savagery which the Con-Dem coalition have in store for us all.

Click here for full article.

Tags: Ed Miliband, Labour, Cameron, Conservatives, Con-Dem coalition

David Miliband bows out, defeated and demoralised.

I have already expressed my sympathy for David Miliband and my hopes that he was going to stick around to help his younger brother.

But, that was all before this, the moment when David Miliband found it impossible to hide his anger at his brother's statement regarding the Iraq war.

So, it comes as no surprise that he has decided that he is not going to serve in his brothers cabinet.

In a departure marked by magnanimity and self-restraint, David Miliband said that in some ways the easy decision would have been to remain in the shadow cabinet, but that his instinct as soon as he lost the leadership race on Saturday was that he would have to go.

He will remain as a backbencher, and write, as well as taking time to recharge his intellectual batteries and spend more time with his two young children. Heartbroken supporters continued to grit their teeth in the interests of party unity, but one said: "David is giving Ed some space to carry on torching the house we built."

The papers seem determined to see this as an act of "magnanimity and self-restraint", but I find the whole thing petulant and self indulgent.

The words of his supporters, that he is "giving Ed some space to carry on torching the house we built", is much nearer to what, I suspect, is actually going on here. Indeed, it is through the words of his supporters that one gets some sense of the anger and frustration which is behind his decision to stand down.

Jon Cruddas, a David Miliband supporter, said he was alarmed by triumphalists claiming that they had got their party back. "There is a danger that we are going to be dominated by a metropolitan liberal faction that is rather removed from the real world," he said.

Lord Prescott praised David Miliband and said: "He helped create a record that we can be proud of, and I respect the fact that during the leadership campaign he chose to defend it."

David represents New Labour and, like most of New Labour, he can't bring himself to say sorry for the Iraq war.

After all, Blair and the rest of them "sincerely believed" that Saddam had WMD, so who can fault them for their "sincere beliefs"?

Ed has broken with that mindset by stating that the Iraq war was wrong, and that statement brought from David the most public display of anger he has shown in his entire career.

The victory of Ed represents the death of New Labour and, as his brother was the next nominal head of that group, it probably is for the best that he heads for the backbenches.

I worry that New Labour will continue to haunt the party, refusing to accept that their moment in the spotlight is over. They delivered three election victories, but they alienated the party from it's base.

The bitterness they are now expressing is based on the fact that they can't understand how the party could be so ungrateful as to reject them.

Tony Blair had warned that the party would face certain defeat should it "move a millimetre from New Labour", which they probably believe, despite the fact that polls suggest a break from New Labour would make 47% of people more likely to consider voting Labour.

One would have hoped that New Labour could be magnanimous enough to hide their bitterness for the sake of rallying around the new leader, but David's departure for the backbenches shows that they are not taking their defeat well.

God knows what they have got in store for us in the months to come.

Click here for full article.

Tags: David Miliband, Ed Miliband, Labour leadership election, UK politics

Miliband Buries The Past.

In terms of style, there is clearly room for improvement, which I am sure he will achieve with time. But, as far as substance went, I thought he - at several points - got it bang on.

He started with where Labour got it right:

We changed Clause 4. We were right to do so.

Think of how we emphasised being tough on crime was as important as being tough on the causes of crime. We were right to do so.

Think of how we challenged the impression that we taxed for its own sake and that we were hostile to business. We were right to change.

And think of how we challenged the idea of a male dominated Parliament with All-Women shortlists and made the cause of gender equality central to our government. We were right to do so.

The old way of thinking said that economic efficiency would always come at the price of social justice.

With the minimum wage, tax credits, the New Deal, they showed that was wrong.

I am proud that our government lifted hundreds of thousands of children out of poverty, hundreds of thousands of pensioners out of poverty, proud that we created the highest levels of employment in Britain's history.

And he was also brave enough to say where we got it wrong.

"Iraq was an issue that divided our party and our country. Many sincerely believed that the world faced a real threat.

"I criticise nobody faced with making the toughest of decisions and I honour our troops who fought and died there. But I do believe that we were wrong. Wrong to take Britain to war and we need to be honest about that.

"Wrong because that war was not a last resort, because we did not build sufficient alliances and because we undermined the United Nations.

"America has drawn a line under Iraq and so must we."

It was extraordinary to watch his brother David and many of other Labour cabinet members sitting there as the conference hall exploded into applause. The Labour party has been held back by Blair's insistence that, although there were no WMD, he couldn't apologise for getting rid of Saddam. Many of the Labour cabinet who took part in that decision have stuck to roughly the same formula when it comes to that subject.

In a few sentences, Ed Miliband blew away that tired logic and claimed the Labour party as his own. Blair and his refusal to apologise have been consigned to the dustbin of history.

And he also attacked the notion that the United Kingdom should behave as almost a satellite state circulating a far greater world power.

"Our alliance with America is incredibly important to us but we must always remember that our values must shape the alliances that we form and any military action that we take."

His brother was too tied to Blair's legacy to ever strike such a distance between his regime and Blair's, which is why Ed is looking ever more like the most sensible choice for a party which feels the need to move on from policies - and acts of sheer stubbornness - which cost us five million voters in as many years.

However his comments about Iraq appear to have annoyed his brother, who was filmed asking Labour's deputy leader Harriet Harman: "You voted for it, why are you clapping?"

The Blairites have been voted out of power and - as David's comments show - they are, even now, unwilling to admit that the sheer scale of the disaster which was the Iraq invasion contributed to Labour's loss and to their own in this leadership contest.

Ed Miliband represents a chance to move on from all that.

And he also refused to allow Nick Clegg to claim the mantle as the person most concerned with privacy and civil liberties when he stated that he would not allow the Tories or Lib Dems to "take ownership of the British tradition of liberty".

These are Labour and Liberal Democrat values, which Blair sold out, imagining that we would sacrifice our privacy for his empty promises - as 7-7 showed - of guaranteed security.

Clegg is to be applauded for his stance on civil liberties, but it is his willingness to swallow right wing economic dogma which will kill him with progressives.

Miliband has put a clear shaft of light between the Con-Dem coalition and Labour. And, I suspect, Clegg's lurch to the right - and the consequent loss of progressives votes for the Liberal Democrats - might make this a very good place for him to pitch his tent.

And, after Blair decided that New Labour would be pro-Israel, without bothering to inform the rest of us that we were now officially on the side of the occupiers, it was heartening to hear this man - whose parents fled the Holocaust - say this:

And let me say this, as Israel ends the moratorium on settlement building, I will always defend the right of Israel to exist in peace and security. But Israel must accept and recognise in its actions the Palestinian right to statehood.

That is why the attack on the Gaza Flotilla was so wrong.

And that is why the Gaza blockade must be lifted and we must strain every sinew to work to make that happen.

They were words that would never have come out of Blair's lips. And conference responded enthusiastically.

As I say, it could have been a more polished performance, but he gets ten out of ten for the substance of what he said.

Today, Miliband buried Blair. And everyone watching knew it. That's a pretty audacious start for a new leader.

UPDATE:

I am pleased that the Independents leader writers heard exactly what I heard:

There were no great game-changing announcements such as when Tony Blair signalled the abolition of the party's Clause Four. There were no breathtaking oratorical flourishes. But in an hour- long address Labour's new leader guided his party away from the traumas and contorted positioning of the recent past and pointed it in a new direction.

As such it was the most daring speech from a Labour leader delivered for a long time.

His brother could never have made that speech.

Click here for full speech.

Tags: Ed Miliband, Labour Party conference, Blair, David Miliband