According Tim’s editorial this morning, following on from a Times article earlier in the week (£), Conservative Cabinet Ministers are sufficiently concerned over how the reforms were being handled to press for the contentious components to be dropped and for only those elements that retain cross-party agreement to be enacted.

The Independent and the Guardian are also reporting disquiet over the Bill at the highest level in the Tory party – the latter also reports that Lib Dems are seeking to secure debate over whether the Bill should be scrapped at Spring conference.

The central argument is that the complicated reforms currently before the House of Lords bear little or no relevance on the financial and demographic challenges that the NHS will face in coming years, and that many of the changes needed to meet those challenges can be put in place regardless of the Bill. Many Liberal Democrats with close knowledge of the NHS have long held this position, seeking to have the Bill scrapped unless significant amendments were secured. It now appears that senior Tories agree that only those elements of the Bill that all parties can agree on should be passed into law, the rest being ditched.

Officially the government remains committed to passing the Bill as it stands, substantial amendments from the House of Lords notwithstanding. Under the surface there are clearly very deep concerns over the political ramifications and those for the health service itself.

The pressure on the Health Secretary and Prime Minister to rethink their position is now undeniable – I would add just this much, that with so many changes to services already underway, they should withdraw the bulk of the Bill and allow the NHS to focus on delivering a first class service at a time of severe budgetary constraint as set out in the Coalition Agreement. There’s little doubt this would be a better outcome than pressing ahead with legislation that now virtually nobody thinks is needed.

In the run-up to the general election, you may remember, the tabloids were screaming, saying that if there was a hung Parliament locusts would descend from the sky and the sun would be blotted out, you know… so we needed for those first few months to show the most important thing of all, which is this is a government that works, and actually works rather well.

Of course, after that phase you then get [that] we’re different parties, we do have different instincts, we do have different values. I just think we are quite relaxed in government that we have our differences – sometimes they are played out in private, sometimes they are played out in public.

Nick goes on to discuss what he sees as significant achievements for the party in government, and, in a telling line, describes the difficulty Lib Dem peers face in supporting legislation they wouldn’t under different circumstances:

Let’s be blunt: I am asking, day in, day out, Liberal Democrat peers to vote on things that they wouldn’t do in a month of Sundays if it was a Liberal Democrat government.

The interview covers such ground as reform of the upper house, Nick’s stance on the Middle East and changes to the tax system.

You can read the whole interview here.

Completing the changes, Jenny Willott becomes an Assisstant Government Whip, and Jo Swinson replaces Norman Lamb as Nick Clegg’s PPS.

Congratulations to those Lib Dem MPs taking up new positions in government.

IPPR’s Will Straw and Alex Glennie set out how the modern increase in global commerce is distinct from those seen around the Industrial Revolution and World War II that were dominated by the UK and the USA respectively. Today’s growth in global trade is lead by developing economies in the East with a new pluralism in the economic strategies pursued by the fastest-growing nations as opposed to one consensus fits all.

The report’s authors take a refreshing approach to the phenomenon of globalisation, refusing to characterise the mixture of global trade and movement of capital, labour and technology as simple A Good or A Bad Thing. Instead they acknowledge that there are both opportunities and threats posed by different aspects of our current wave of globalisation.

The authors conclude that there are opportunities presented by the opening of new markets for highly-skilled and value-added services and manufacturing in particular, as well as threats from unregulated flows of capital and, crucially, the largely political failure to ensure that the benefits of global trade are justly distributed and citizens are adequately protected from the significant risks posed by the demands that globalised trade brings.

Lib Dems interested in reforming our economic systems, domestically, on a European front and globally (we’re nothing if not ambitious, right?) will find plenty of familiar political philosophy in the report. Indeed some of it states the obvious as far as Lib Dems are concerned and we could go as far as welcoming Lord Mandleson onto territory long-held by our party. We’ve long recognised the advantages of global trade (and are suspicious of economic insularity) but we also seek to ensure that the terms of said trade and the accompanying social policy makes prosperity both justly distributed and politically legitimate – that is the essential message of this study.

The IPPR’s suggestions for making sure globalisation works span both global and national remits; the former include Bretton Woods-like controls on capital flows, more robust global economic governance through strengthened institutions and a new global reserve currency, and the latter an interesting mix of taxation and social protection policies to be applied by countries as suits them to match their developmental stage. The policies mooted for Britain will challenge both lazy economic libertarians who see unrestrained markets as the only way to raise living standards, as well as those who seek to somehow put globalisation back in its box through protectionism. The report’s recommendations should be carefully examined and debated by all those seeking significant economic reform.

It is some journey for anyone to make from the paean to efficient market hypothesis that was New Labour to the recognition that in order for the global economy to serve socially liberal ends there needs to be strong democratic oversight of its institutions and outcomes. Lord Mandleson appears to have made exactly that journey, from being “intensely relaxed…” to saying in this report that the orthodox economic consensus of the past 20 years got the balance between economic efficiency and security wrong, and that “we must learn (or re-learn) the simple fact that we need effective states and governance to get the best out of globalisation.”

In that sense, this report marks a departure from the view that technocratic economic management would produce socially optimal results, and sees Mandleson finally acknowledge that the inequality that unrestrained capitalism brings poses a huge danger. Moreover it marks the return of a discourse in terms of political economy, an art too often overlooked in recent years. I for one relish the debate continuing on precisely those terms.

James was responding to Zoe Williams in the Guardian (well worth a read), who rightly highlights the negative societal impact of companies paying their employees wildly differing amounts – sky-high executive salaries at one end of the spectrum, and sub-living wages at the other that  have to be topped up by complex and costly welfare spending.

Of late there has been a great deal of coverage of extremely high pay, and bank bonus season will undoubtedly keep said payments firmly under the microscope. Rather less has been made of the payment of wages that aren’t sufficient to attain a decent living standard, and the illogical system of meagre compensatory handouts it necessitates.

So the question again is: if we want to see fair wages at the low end of the spectrum, what’s the best mechanism? Exhorting companies to ‘play fair’ (also known as tilting at windmills in some circles…)? Making the tax system more favourable to low earners? Giving employees a greater say in how companies are run? Legislating for a living wage?

In reality of course it’ll take a mix of the above, and possibly other measures, to secure fair wages for all – how do you, the esteemed LDV reader, think the Liberal Democrats should approach fair pay?

Excessive remuneration appears to be the latest issue on which the three main parties appear to agree – it apparently unites the hitherto unlikely trio of Vince Cable, Ed Miliband and, latterly it seems, David Cameron around the recognition that extremes of pay are damaging not only for individual firms but for the economy at large and should be tackled somehow by government.

These arguments, made by many for decades, were crystallised in the outstanding final report from the High Pay Commission in November – a report that I argued should be welcomed and actioned by the Lib Dems. Yesterday, Shadow Business Secretary Chuka Umunna set out the Labour party’s response to the report in a speech to the IPPR and ICAEW that endorsed the HPC’s recommendations. He emphasised the pernicious effects of excessive executive pay, but stopped short of ‘those dangerous lefties at the Financial Times’ and their ‘Capitalism in Crisis’ series. It is perhaps this reluctance of Labour and Tory leaders alike to recognise that the core of our political economy is rotten that leaves a golden opportunity for Liberal Democrats in government to implement our vision of a fairer, more sustainable economic settlement.

From the comfort of opposition one would hardly expect anything other than a full endorsement of the commission’s findings from Labour, and while the speech swung from point-scoring politics to economics seminar, there was little doubt that Labour intend to press the Coalition into action on high pay – and that their own complicity in allowing pay inequality to soar will barely be acknowledged. In addition, although Umunna gave hints of some interesting proposals that go further than those in the Commission’s report, he provided scant detail of how Labour would go about implementing any of them – again, the ease of flying kites in the absence of the constraints of power comes to mind.

So where do Liberal Democrats seeking to put fairness front and centre in the Coalition’s record go from here? To me the emerging consensus on the problem of high pay belies pretty big differences in how the three parties think it can be tackled. Cameron feels that retrospective but binding shareholder votes on remuneration will suffice – not likely, I’d say. Similarly, Umunna focussed on getting shareholders to exercise greater fiduciary responsibility, as did his discussant the former City Minister Lord Myners – but as the Commission Chair Deborah Hargreaves pointed out, most shareholders only hold very short-term interest in a companies’ fortunes and so aren’t in a position to care about high pay. This is why Jonathan Hunt’s call earlier today for the true holders of risk – people who hold pension funds and other investments – to have a greater say in company matters should be heeded.

There’s a bigger opportunity here for Liberal Democrats and for Vince Cable in particular who has lead the debate on fairer capitalism – an opportunity to reform how power, risk and  reward are distributed amongst all the stakeholders in a business, from shareholders to employees to society at large. Labour can fly all the kites it wants, but it’s the Vince and the Lib Dems who will take this chance to make our economy fairer.

Horton acknowledges that the specific case of PIP, and the industrial-grade silicone they appear to have used in breast implants, represents clear regulatory failures at the hands of the Medicines and Healthcare products Regulatory Agency (MHRA).  The Health and Social Care Bill has very little to say about how the way in which medical devices are regulated and any changes to the way the MHRA operates following this episode will be independent of the reforms contained within it.

There is, however, a very strong link between the Bill and the PIP scandal, as Horton goes on to explain and as many others in our party and the medical profession have warned of for some time. That is the increasing reliance on private healthcare providers to deliver NHS services, and the implications for patient safety and the quality of care and what happens in the event that either are compromised.

It has to be stated (sad though that is, but the polarised nature of the debate on the NHS requires it) that there is no a priori reason why increased private provision of healthcare would necessarily cause a drop in standards – there are examples of both good and bad practice in both public and private spheres, and we must not overlook the fact that whilst health scares can and do happen in both arenas, the NHS delivers a very highly-rated service with world-class clinical care with the mix of public and private provision it uses. Although reforms are needed to the way the service operates, we as a party need to ask whether episodes such as the breast implant fiasco will become more common as a result of the particular reforms currently being advocated – whether extending the reach of the profit motive will compromise care quality and what happens if it does.

With the NHS moving increasingly towards being a purchaser of privately-provided services in a competitive market, questions must be raised as to how market participants are regulated and what happens when the market fails to deliver quality patient care. The answer from orthodox economics, lessons from which have been increasingly applied to the provision of public services under successive governments, has been to allow competition between providers but to give consumers choice and voice – the ability to choose better providers, and the vocal power to ensure they get the best service.

This philosophy permeates the Open Public Services White Paper too, and stems from the work of, amongst others, Julian le Grand, who advised the Blair government on health matters. The increase of choice through greater private provision, and of voice through the new HealthWatch bodies which are already forming, are central to the Lansley reforms.

Now is not the time to go into Kenneth Arrow’s impossibility theorem and its implications for the provision of healthcare in a competitive market – for another day perhaps. For now, suffice to say that optimising service provision through competition amongst providers moderated by consumer choice and voice may work in theory for the provision of routine, uncomplicated services, but for complex ones like healthcare which can quite literally be a matter of life and death, choice and voice may not be enough or even appropriate.

In the interest of not writing too much I will simplify the argument – consumers in the breast implant ‘market’ have made a choice (to have implants by PIP), and are now raising their voice to make their displeasure at the quality of service known. It may be that in the long run, this  will allow future providers to configure a better service – but for those unfortunate women who’ve suffered anxiety and possible complications because of a poor standard of care, the post-hoc exercise of choice and voice comes far too late. To say nothing of the moral hazard (to borrow another economic term) created when private providers are allowed to walk away from their obligations to patients and leave the NHS to patch up the mistakes they make, as is the case here.

So whilst it’s not a case of “private bad, public good” (‘I think you’ll find it’s a bit more complicated than that‘ as some would say) Lib Dems who want to see excellent standards of patient care retained and improved should be wary of reforms that rely on choice and voice as the mechanisms through which this is achieved. The debate amongst Lib Dems must continue, especially regarding the risk to patient quality. Something for the re-launched Beverdige Group to consider, perhaps

A number of posts on [Liberal Democrat council by-election candidate Dave Stones'] Facebook page were seemingly calculated to deliberately offend Muslims — including spreading outright smears. Stones claimed that the Royal British Legion were “not selling poppies in certain areas of the UK”, implying that objections from Muslims were behind the decision

The comments have since been removed and an apology issued:

We welcome Mr Stones’ unreserved apology and acceptance that the comments he copied and pasted were completely unacceptable.

As reported in The Guardian, these priorities include tackling tax avoidance by both corporations and wealthy individuals, clamping down on excessive and undeserved top pay, and re-engaging with governments and business in Europe following the Prime Minister’s unhelpful showing in Brussels at the end of last year.

Pressed on how that re-engagement would materialise, Nick said that he is meeting with Liberal leaders from across Europe “to set out the British vision of greater competitiveness and growth across the European Union.” It is clear that reasserting Britain’s place at the heart of a reformed Europe, using our ‘considerable clout,’ remains a major priority for the Deputy Prime Minister.

There were encouraging words for those of us who want this Government to take a stronger line on the unfair exploitation of complicated loopholes in the tax system. Nick made it clear that Lib Dems were seeking to implement measures that would amount to a General Anti-Abuse Rule (GAAR), as recommended by Graham Aaronson in a report for the Treasury. It’s probably not surprising, as The Voice previously suggested, that a GAAR along the lines that Aaronson proposes would be more narrowly focussed than an anti-avoidance rule, but it would nonetheless go some way to making it harder for companies and wealthy individuals to ‘play the system’ and avoid paying their fair share of taxes – which as Lib Dem MP Stephen Williams’ Early Day Motion suggests, is the ultimate aim of such measures. Coupled with lifting the personal income tax allowance yet further, the idea is to shift the ensure the tax system is fair and transparent.

Continuing on the theme of fairness, Nick emphasised how important it was to tackle excessive pay as well, particularly in cases where the highly paid don’t do well by their companies. Action on this front would be welcomed by those who’ve long believed that excessive pay distorts company performance and is grossly unjust.

Encouraging though these remarks are, they point to an overarching priority Ia meta-priority, if you will) that Nick hinted at in his interview. Acknowledging the electoral difficulties the party faces – difficulties that Mark Pack discussed in an earlier Today Programme segment, Nick said ‘we must constantly explain to people what we are delivering in this government.’ This need applies in particular to those policies which are clearly Lib Dem in nature and provenance, as recent press reporting of the measures to tackle high pay in particular demonstrate.

This Financial TImes story (£), for instance, cites both Danny Alexander and Vince Cable as key personalities in the government drive to control excess pay – and yet the headline and allied reporting credits the Prime Minister as the one who’s tightening the screw on top pay. Of course we would expect that in grown-up politics – the Tories are more than likely to take credit for such things, that’s the nature of being in coalition.

But it does point to an additional priority that Nick should keep front and centre in 2012 –  it isn’t enough just to get the right policies in place, we have to ensure that the Liberal Democrats take ownership of the issues involved. This way we can work for the benefit of the nation and be given due credit for significant Lib Dem wins in power.

Seeking to assess the support amongst the party membership for reforms to how alcohol, tobacco and currently illicit drugs are regulated, the latest LDV members survey has thrown up some interesting results – we’ll start by looking at what respondents make of the current regulatory regimes for alcohol and tobacco.

Most LDV readers back status quo on regulation of alcohol an tobacco

LDV asked: In general, do you think existing regulations and taxes on the sale and use of alcohol…
Go too far: 10.8%
Are about right: 51.1%
Don’t go far enough: 34.8%
N/a – it should be illegal: 0.2%
Don’t know / No opinion: 3.2%

Asked the same question in relation to tobacco sales and use, the readers’ responses were as follows:
Go too far: 9.8%
Are about right: 53.0%
Don’t go far enough: 32.8%
N/a – it should be illegal: 2.3%
Don’t know / No opinion: 2.1%

There is remarkable consistency between the responses, with a significant minority saying the regulations on both alcohol and tobacco sales don’t go far enough (3 times as many as those who say they go too far already) whereas a clear majority say they’re both about right.

As the Prime Minister recently asked for minimum alcohol pricing proposals to be explored, these results are a timely indicator of the party’s position on the matter. It appears that current levels of regulation are considered appropriate by LDV readers, although admittedly there wasn’t a specific question relating to minimum alcohol pricing – it would be interesting to determine readers’ response to the current proposals (as advocated here by Ewan Hoyle), the Scottish minimum price policy that’s imminent, and the kind of proposals put forward by drugs expert Prof. David Nutt.

Majority of LDV readers support legalisation of possession of cannabis, with significant support for reform regarding other drugs

LDV asked: Which, if any, of the following drugs do you think should be legalised (ie, permit both possession and regulated sale)?
Cannabis: 69.7%
Amphetamine (“speed”): 31.0%
Cocaine powder: 27.8%
Ecstasy: 38.3%
Magic Mushrooms: 37.8%
LSD: 29.1%
Ketamine: 20.7%
Crack cocaine: 17.4%
Methamphetamine (“crystal meth”): 16.8%
Heroin: 23.1%
Other drugs: 4.8%
None of them: 18.3%
Don’t know / No opinion: 11.0%

There is significant support for reform of the way drugs are regulated, with a clear majority of respondents backing the decriminalisation of cannabis possession and its regulated sale. Interestingly significant numbers of LDV readers also back a similar regime for drugs that are currently ‘Class A’.

This support for drug law reform, affirmed at Lib Dem Conference in Birmingham, is mirrored by overwhelming support for the way that the harms from drug use is dealt with.

LDV asked: Assume that at least some drugs remain illicit, and that supply would continue to be punishable as now. How should possession for personal use typically be treated?

A huge majority of LDV readers (85.8%), when asked how possession for personal use of those drugs that remain illicit should be dealt with, backed alternatives to the current criminal sanctions (backed by just 7.5%). Such scant support for the status quo is mirrored by opinion in the Conservative party, where ConservativeHome readers backed changes to the way drugs are regulated – albeit with significant support for what many see as a tougher stance.

The party’s progressive stance on drug law reform comes in the context of ambivalence about the electoral consequences thereof:

LDV asked: On balance, do you think the Lib Dems would benefit or suffer electorally if the party’s MPs and/or manifesto were to vocally support substantial drug policy reform?
Benefit a lot: 7.5%
Benefit a little: 24%
No significant difference: 19.7%
Suffer a little: 29.4%
Suffer a lot: 14.7%
Don’t know / No opinion: 4.8%

So currently there are more LDV readers who think that the party would suffer to some extent if we vocally supported drug law reform than those who consider a reforming stance a potential benefit. It may be that as voters become more familiar with the arguments in favour of evidence-based reform of the failed ‘war on drugs,’ and as Lib Dems own the reform agenda more clearly, the responses to the last question may change. 2012 is likely to be a pivotal year in the effort to secure drug law reform, as the Home Affairs select committee conducts an inquiry into drugs policy. Of course the party’s policy is for an independent panel to conduct a full Impact Assessment and review of the 1971 Misuse of Drugs Act, but the HASC inquiry does represent an important staging post on the way.

What’s clear is that LDV readers are fully engaged with the movement to ensure that the UK has robust, evidence-based policy to control the harms that stem from drug use – the debate as to the details of such policy continues apace.

• Over 1,200 Lib Dem paid-up party members are registered with LibDemVoice.org. Some 564 responded to the latest survey, which was conducted between 9th and 13th December.
• Please note: we make no claims that the survey is fully representative of the Lib Dem membership as a whole. However, LibDemVoice.org’s surveys are the largest independent samples of the views of Lib Dem members across the country, and have in the past accurately predicted the winners of the contest for Party President, and the result of the conference decision to approve the Coalition agreement.
• The full archive of our members’ surveys can be viewed at www.libdemvoice.org/category/ldv-members-poll

Criticising the Tory right’s approach to the EU, he says:

I am worried there is a tendency on the Conservative right wing, a significant part of its parliamentary party, that does not appreciate the importance of being at the table in Brussels when it comes to negotiating the rules for the single market – and does not understand the strength the EU gives us globally in tackling problems like climate change.

In a strong re-statement of his pro-European stance, reflecting that of the Liberal Democrats, Chris says:

We need to make that case more positively. The case for our membership of the EU is not a case for ending national sovereignty but for delivering an age-old, historic objective of our foreign policy.

You can read the full interview here, in which an unfavourable contrast emerges between the Prime Minister’s strategy in Brussels and Huhne’s own at the climate summit in Durban.

It seems Europe is an issue on which the Cabinet remains divided along party lines.

Anticipating Chancellor George Osborne’s formal announcement today, Vince told the BBC’s Andrew Marr that the  separation of retail and investment banks –  ’something I and the Liberal Democrats have pushed on for a long time’ – will go ahead, indicating that the ‘angry heckling by banks’ (Marr’s words) had failed to blow the Government off-course.

Indeed Vince went as far as  to say that the necessary primary and secondary legislation would be completed within this Parliament – ‘we’re getting on with it.’ It’s likely that banks will be given until 2019 as recommended by the Vickers report to fully comply with said legislation, a timeframe that has disappointed senior Lib Dems. Nonetheless we have here a clear example of Lib Dem influence on government policy – from Conference to Cabinet to  legislation it would appear – that goes some way to making Britain’s banks safer and more effective.

So far so good, now for the nuts and bolts to fall into place.

Hasan pointed out five areas in which the Lib Dems had (in his view) “sacrificed their distinctive beliefs and principles and received little in return.”

I responded with my own 5 points, including:

1) Ask the nearly 1 million low-paid workers who have been lifted out of paying income tax altogether thanks to a Lib Dem manifesto commitment delivered in government. With the prospect of further significant reforms to come to make our tax system fairer and more progressive, this policy makes people hundreds of pounds better off in difficult times. Consider the counterfactual too – a Tory-only government cutting inheritance tax and the 50p rate for its rich pals whilst doing nothing for the low-paid. Not with Lib Dems in government.

2) Ask the millions of children, parents and teachers who are benefiting from the pupil premium & expanded childcare provision as part of the government’s investment in crucial early-years facilities. Another Lib Dem manifesto commitment, delivered in government, making a real difference to the worst off and those in need of support.

You can read the other three here, and dive into the comments thread if you dare – be warned, it isn’t for the fain-hearted…!

It’s heartening to see such a clear-cut call for a more humane, evidence-based drugs policy as part of a widening debate on the matter. As we reported recently the government has taken positive steps towards reviewing the UK’s stance on drugs, and this type of discussion will only bring forward the day when the failed ‘war on drugs’ is replaced by liberal and effective policies that reduce the harms that drugs cause.

The Lords debated Conservative Peer Lady O’Cathain’s motion to have new regulations on civil partnerships delayed because of fears that equality campaigners could use the Equality Act 2010 or the Human Rights Act 1998 to force religious organisations into honouring their civil partnerships against the organisations’ will. These concerns were comprehensively dismissed by, amongst others, Lib Dem peers who gave assurances that nobody would be forced to perform same-sex civil partnerships should they not wish to. The assurances given were enough for the motion to be withdrawn.

Commenting, Lord Rennard said

The debate today made clear that there was no real merit in the argument advanced that religious organisations could be forced against their will into allowing civil partnerships to be conducted on their premises. It is probably not a co-incidence that those peers who tried to construe a legal argument to this effect seemed to be those most opposed to the principles of civil partnerships.

While Lynne Featherstone also welcomed the withdrawal of Lady O’Cathain’s motion, which was restricted to the rules on civil partnerships, she made it clear that she wanted the government to go further:

I look forward to working equally constructively with all interested people and organisations as we move ahead with the Coalition Government’s plan to open up marriage to same-sex couples. Our commitment to equality runs deep, as next year’s consultation on equal marriage will show.

A heartening episode for those interested in the equal treatment of same-sex couples who want to celebrate their love for each other, and another example of Lib Dem Parliamentarians standing up for freedom and equality.

I’m hardly a fan of the ‘blame Labour’ rhetoric used by many Coalition Ministers, but a look back at the jobs market over the last few years reveals that Labour must take responsibility for the steep rise in unemployment under its watch. From a pre-crash floor of 5% in November 2007, the ILO unemployment rate jumped in the space of 19 months to 7.9% in June 2009. Of course this was the result of a deep, long-lasting recession originating in an unprecedented financial crisis and accompanied by a ballooning budget deficit – which is precisely why Labour needs to acknowledge their role in presiding over a disastrous crash in the jobs market.

This does not, however, absolve the Coalition of responsibility to any real degree. The heated exchange over the latest figures at PMQs between Ed Miliband and Cameron showed that whilst the latter’s ‘we won’t take lectures from Labour’ line still works, the former is increasingly right to ask why the current administration isn’t able to reverse the rise in unemployment which has now hit 8.3% of the workforce, or 2.64 million.

Both Labour and the Coalition promote(d) policies aimed at getting people back to work – misguided though some of them may have been, there’s little doubt that both the current Coalition and its predecessor administration have had some positive impact, as I’m sure will the Youth Contract will to some degree. But will any of these policies revive the demand for good and services that underpin net job creation? Will the jobs, and in many cases the public good that those jobs provided, be adequately replaced by private sector recruitment? Are we as a country sufficiently preparing our young workforce to navigate the fluid jobs market where chopping and changing will be the norm? Serious questions remain over how this Coalition deals with an increasingly troubling feature of the UK economy, not least when we consider the squeeze on living standards for those in work as a result of stagnant wages falling far behind inflation.

For many on the left, this latter problem in particular calls for stronger and more activist trade unions – and there is a liberal argument for this in that often strong unions do the work that legislation is forced to do elsewhere. However, as the latest Tube strikes demonstrate, unions don’t always aid the cause of even those they represent, let alone the wider public interest. There is also much talk of a return to the co-operative movement, not only so that workers can group together to run ailing public and private organisations, but to revive the friendly societies of the late 19th/early 20th Century that provided much more than today’s unions do.

So what does the esteemed LDV reader make of government proposals to boost employment? To what extent should full employment be an aim of government policy?Was scrapping he Future Jobs Fund a mistake or was the Fund ineffective? Will the Regional Growth Fund and the Youth Contract boost jobs? What role can unions, co-operatives and friendly societies play in ensuring security, decent wages and training? The comments thread beckons!

[Declaration: for the last nine years I worked in an academic research laboratory, developing therapies for inherited disorders that cause blindness. During this time I worked with animal models to help our improve our understanding of disease mechanisms and to act as a test-bed for new therapies].

The sparsely-attended adjournment debate on Wednesday secured by Conservative MP David Amess, saw a rare thing – a genuine discussion based around the merits of peer-reviewed scientific research and a robust defence of an evidence-based approach to translational medicine from Lib Dem Home Office Minister Lynne Featherstone. For a biology nerd interested in the application of scientific knowledge to public policy it had all the ingredients of a pre-Christmas gift – I can fully recommend the Hansard transcript for a full picture (yes, I am that sad…).

Mr. Amess has some track record of Parliamentary campaigning against animal cruelty, and he reviewed his contributions before getting to the core of the issue – an EU directive adopted last year that, according to Mr. Amess, threatens the high animal welfare standards found in UK scientific laboratories. In responding to these concerns, Lynne Featherstone sought to reassure the house that no such threat was posed by the Directive. Indeed the Economist article cited by Margot James MP in an intervention is, as Lynne pointed out, incorrect when it says that “the strict laws that require British scientists to consider alternatives to animal tests may be partially relaxed as a result of European reforms.” On the contrary, to quote the Directive itself,

this Directive represents an important step towards achieving the final goal of full replacement of procedures on live animals for scientific and educational purposes as soon as it is scientifically possible to do so. To that end, it seeks to facilitate and promote the advancement of alternative approaches

and that if anything the flexibility afforded to EU states regarding welfare would be to impose stricter standards above the floor set by the EU.

Mr. Amess relied on two central arguments in his speech – one entirely reasonable, and one that he claims arises from the first but that in truth is simply inconsistent with it.

The MP for Southend West rightly pointed out that adverse drug reactions (ADRs) in clinical trials and when drugs are approved for use are a real concern, and that his Safety of Medicines Bill has garnered cross-party support which indicates the depth of said concern. There’s little doubt that the medical profession should endeavour to minimise adverse drug reactions and should consider all relevant avenues for doing so including scientifically valid tests of drug safety based on human biology/tissue, as the Bill calls for – however this reasonable position is spoilt by what follows. Mr. Amess wrongly ascribes the extent of ADRs to the use of animal models in pre-clinical research, and makes a logical leap in suggesting that the use of animals to assess drug safety is inappropriate.

The Bill appears to have originated with the Safer Medicines Trust, which describes itself s

an independent patient safety organisation of doctors and scientists whose concern is whether animal testing, today, is more harmful than helpful to public health and safety.

I don’t know enough about the Trust to judge its funding, remit and merit – but I can dispute many of the straw men that Mr. Amess raised in his speech, and can support the line that Lynne took.

Mr. Amess argued that animal models lure scientists into a false sense of security over the safety of drugs, and that because compounds found to be safe in rodents can be toxic when taken by humans that animal testing should be replaced by computer modelling, in vitro tests using human tissue and ‘micro-dosing’. He failed to grasp that the pre-clinical animal trials are an additional test, not an alternative one, to human testing; that the use of animals can be informative if scientists exercise caution in extrapolating their findings; and that thousands of successful drugs have been developed through regulated, judicious use of animal-based pre-clinical testing. These are issues I raise with post-graduate students in my lectures on the relevance of animal models in developing new drugs; Lynne made a point of reminding Mr. Amess of these facts and more in stating that

animal studies are considered to be an indispensable component in the assessment of the safety and efficacy of a new medicinal product. Without animal testing, it is highly likely that a large number of potentially dangerous medicinal products would have to be tested in healthy volunteers and patients in clinical trials. That would be quite unacceptable.

He also failed to understand that there is no single test for how well a drug will be tolerated, that the extent to which a drug will provoke ADRs when widely used cannot be predicted with any certainty even after human clinical trials.

Lynne also rightly praised the work of The National Centre for the Replacement, Refinement and Reduction of Animals in Research (NC3Rs), which works with researchers, regulators and animal welfare campaigners to ensure that animal research is only carried out when justified, in ways that minimise the numbers and suffering of animals, and supports the development of viable alternatives to animal models. The work of the NC3Rs ensures that the UK strikes the balance between animal welfare and medical benefit when it comes to animal research.

Ultimately, I’m afraid Mr. Amess’ objection to the use of animals in research stems from a misunderstanding of how medical research works. He seems to think that we use animals to determine with certainty which compounds will be both safe and effective, and that the use of animals is designed to eliminate ADRs in humans. In truth, as Lynne hinted in her response, there is an element of Knightian uncertainty when it comes to individuals reacting adversely to drugs, and even if we abandoned animals as our shibboleth we’d still face that uncertainty – indeed we’d probably have more adverse reactions tests of human cells in dishes will likely bear even less relevance to how intact humans will tolerate new compounds. Whilst the development of in vitro and in silico drug safety tests should continue, regulated and judicious use of animals will continue to be a valid method of developing safe and effective medicines for clinical use.

need for all banks to fundamentally restructure their remuneration practices.

This follows on from the independent High Pay Commission’s report into executive remuneration, which emphasised the need for shareholders to play an activist role in setting top pay – the letter appears to be a first step towards a large number of shareholders in UK banks taking just such a stance.

The ABI’s concerns relate to both the payment of high salaries and bonuses in an environment where banks’ profitability has fallen, and the structural distortions that such remuneration causes. Using diplomatic language to condemn what are commonly referred to as ‘rewards for failure,’ the ABI calls for banks to

reduce variable awards in the context of outcomes that significantly reduce profitability or impact the underlying financial strength of the bank or its risk profile.

The letter also raises concerns that as banks are required to hold more capital as regulation is tightened through the likes of the Basel III agreement and the imminent implementation (we hope) of the Vickers reforms, that such higher capital is held at the expense of some the salary bill as well as the return to investors in the shape of dividends.

In addition, they debunk the myth that high pay is justified by the need to retain ‘talented staff’ who would otherwise be poached by other banks, possibly abroad.

This strong call for ‘fundamental shifts in remuneration practice,’ which means ABI members ‘expect to see significantly lower bonus pools and individual awards given the current market circumstances,’ echoes Deputy Prime Minister Nick Clegg’s insistence that unjustified boardroom pay will be clamped down on. As I argued recently, Lib Dems in government should be pushing for measures that curb excessive pay, and its good to see the DPM and the ABI flex their muscle on this issue.

The ABI’s intervention could be significant as there is concern that shareholders are either not empowered enough to hold remuneration committees to account, or are simply disinterested in social justice because they see their shares as an ephemeral trading commodity rather than a stake in the business. It may be that such concerns, expressed by Professor Prem Sikka in the Guardian, will prove to be unfounded if the ABI’s concerns are taken seriously. Nonetheless there is a need to keep a watchful eye on excessive pay in banks and the financial sector as a whole – with bonus season approaching, I for one will be hoping that the ABI is listened to. If not, it may be time for shareholders institutional and individual to escalate the battle to control top pay.

There is now widespread recognition that the UK’s drugs laws are ineffective and expensive, with MPs of all parties signing Tom Brake’s recent Early Day Motion that called for evidence-based drugs policy and encouraging noises from the likes of Conservative MP Mike Weatherley, member of the All Party Parliamentary Group on Drug Reform.

One of the APPG’s Vice-Chairs, Lib Dem MP for Cambridge Julian Huppert, has long supported the calls for more rational, scientifically robust and evidence-based policies on drugs, and there’s little doubt that the presence of this leading advocate for reform on the Home Affairs Select Committee will have helped bring about the inquiry.

Emerging from the woodwork then are ‘current’ members of government willing to tackle this difficult but essential area of public policy, joining the chorus of ‘formers’ and ‘exes’ who have spoken out recently in favour of reform. As Julian told the BBC’s Mark Easton, Parliament may have held inquiries of this nature before, but since then there’s been a shift in public opinion regarding our drug laws – there’s considerable backing for significant reform:

Public opinion has changed. Lots and lots of people think that the current policy is not working. The mood has changed and there is far more evidence of the effectiveness of alternatives to the current policy.

So following the sterling work that Ewan Hoyle, Adam Corlett, Duncan Stott and others at the Liberal Democrats for Drug Policy Reform put in to getting Conference to back their brave motion, we have a welcome first step on the road to better drugs policy. As I said in the heartening Conference debate on drugs policy, we must also insist that such policy as is enacted be based on robust, independent scientific advice and evidence.

Should you wish to make a submission to the HASC inquiry, you should note the terms of reference and send your thoughts to the Committee by email, in no more than 2,500 words. With outstanding Liberal Democrat campaigners on this matter both within the Parliamentary Party and amongst the membership, we can be hopeful that such submissions will help bring about the much-needed reform of our outdated and ineffective drug laws.

These statistics and many more come from the High Pay Commission’s final report [PDF], and together they paint a very stark image. Divorced from measures of corporate performance, executive remuneration across all sectors of the economy has risen exponentially and now poses a clear and present danger to the stability of our political economy – that’s the salient lesson to be learned from the Commission’s findings.

Having set out the evidence of the accelerating increase in top pay, the Commission argues that there are grounds for action on excessive pay at the very top that cover three broad areas, all of which point towards radical reform of executive remuneration.

The business case for fair pay states that company performance is dampened by reduced employee motivation resulting from unfair executive pay settlements. Independent studies verify that companies with more engaged employees perform better on a host of indicators. When added to the reduced trust that the public places in business (the Commission reports this as falling) and the harm to particular companies’ reputation, there is a real case for reforming pay on the basis that it would benefit companies to do so. I would point out, however, that the continued rise of top pay indicates that serious though these considerations may be for companies themselves they clearly haven’t played heavily on the minds of those who matter; the business case at the level of individual firms alone won’t be enough to curb excessive remuneration.

Hence the Commission presents a macro-level case for fair pay from the systemic perspective. They argue convincingly that soaring high executive pay discourages the entrepreneurial risk-taking that drives stable economic growth (the incentive to take capital risks is lower when money’s easier to come by in corporate boardrooms), as well as introducing greater economic instability and ‘sectoral imbalance’ within an economy by skewing rewards towards particular avenues. When juxtaposed with the stagnation of wages for the vast majority – detailed in a report also published this week by Professor Kenworthy for the Resolution Foundation – sky-high pay at the top prevents most people from benefiting from the proceeds of growth and from participating fairly in the market economy. The economy’s foundations are weakened when incomes are concentrated at the top.

Finally the Commission sets out the social case for fair pay, followed by 12 recommendations as to how to make pay at the top fairer. I’ll return to the former after discussing the latter – what should government and business do to make top pay fairer?

The 12 recommendations aim to improve transparency, accountability and fairness with regards executive pay – and expressly do not aim to set arbitrary limits to remuneration by State diktat, something worth emphasising. They seek to make top pay more transparent through standardised reporting of executive pay, and the simplification of executive pay packages to allow better public scrutiny. They seek to increase accountability on top pay, giving employees and shareholders a greater voice in how executive remuneration is set, as well as making non-executive appointments to boards less of a closed-shop. Finally, the Commission calls for publicly listed companies to produce fair pay reports along the lines of those recommended by Will Hutton in his public sector fair pay review, as well as the institution of an official High Pay Commission to monitor trends and enforce sectoral agreements in high pay.

Critics of the Commission’s approach will argue that these measures are unnecessary – that the debate over high pay is either a distraction from the more pressing matter of raising the fortunes of those at the bottom of the pay scale, or worse still an attempt by the Statist left to exploit the politics of envy and deny the deserving rich their due rewards. To refute these claims, let’s return to the social case for fair pay.

For me, excess executive pay is a marker of the inequality of arms that underlies it, a symptom of the imbalance between the interests of the few at the top of a company and those who work within it. When executives appropriate bigger and bigger shares of a company’s turnover as pay for themselves, it indicates their growing alienation from the rest of their co-workers – and hence from society as a whole. Such alienation is a key driver of psychosocial stress and is a way for those lucky enough to have made it to the top of capturing the means for others to do so; there’s a great deal of evidence that inequality of income reflects underlying inequalities of power and responsibility, that the payment of barely-credible pay packages stems from the immunity from scrutiny that great power without accountability brings.

With excessive pay and power comes the ability to alter the rules of the game in favour of the rich – meaning that far from being a distraction from solving abject pay and conditions for many at the bottom, soaring high pay actively harms our attempts to do so by allowing a rich minority to dominate the debate. In truth it’s talk of ‘bashing job creators’ (leaving aside record levels of unemployment) and the like that’s the distraction as it misses the point – concentrations of pay reflects the trickle-up concentration of power that prevents the creation of a fair economy that we should focus on.

It pains me to have to state this so plainly, but I am a liberal. I believe in social arrangements that make more people free to achieve the aims and ends that they have reason to value, and as such I am suspicious of the concentration of power in the hands of a few at the expense of the many. It is because I am a liberal that I won’t tolerate the accumulation of unjust remuneration in the hands of a tiny minority of executives whilst millions see their livelihoods ruined. It’s my liberalism, social liberalism if you like, that convinces me that true prosperity is co-produced by labour, management, finance and the State, not just the so-called talent of the richest 0.1%. It’s because I’m a liberal that I find it heartening to see Vince Cable taking this report seriously, and this Lib Dem for one won’t rest until we see fairer pay in public and private sectors based on the principles of due desert for discretionary effort.

For more on the Liberal Democrat reaction to the High Pay Commission, see Stephen’s post from earlier.