Here is the full text of Ed Davey’s speech, given at 1pm today.
Good afternoon friends.
It was an enormous privilege to represent our party, and my Kingston and Surbiton constituents, at the funeral of Her Late Majesty Queen Elizabeth II.
Beneath the splendour of Westminster Abbey, surrounded by dignitaries from nations around the world – It was a beautiful memorial to a life of faith, devoted to our country and our Commonwealth. And a poignant celebration of values we all hold dear:
Patriotism. Compassion. Service. Values embodied by Her Majesty.
We thank her again. And we welcome her son, King Charles III, to the throne. This speech was, of course, originally scheduled for September. In Brighton. But we rightly cancelled our conference, so we could properly mourn Her Majesty.
That does of course mean that I’ve had to postpone this speech for 47 days… Or, to use the modern unit of measurement, approximately one Liz Truss. And that says it all, doesn’t it?
The chaos and incompetence that these Conservatives have inflicted on our great United Kingdom – All their squabbling, their scandals, their sleaze. It’s shameful.
This would be unacceptable at any time. But when our country is in the grip of a cost-of-living crisis – When local health services are on their knees – When war ravages our continent – It is nothing less than a betrayal of the British people.
Has there ever been such a chasm between the duty and dedication needed for public office, and the appalling dishonesty and disregard of this Government?
Over the last few months, I’ve listened to countless people, in my constituency and all over the country – People, struggling, just to make ends meet. Pensioners, shivering at home, scared to turn on the heating. Pub landlords, seeing their overheads skyrocket. Parents making difficult cut backs, trying hard not to let their children see how worried they are.
People need a Government in control. With a plan. With a fair deal. But what have we got instead?
Chaos. From Conservative clowns, who either don’t get it or just don’t care. The Conservatives try to blame their chaos on everyone else.
The BBC, the civil service, the “wokerati” – whoever they are. They’ve blamed the Bank of England, British businesses, and even British workers. But it won’t wash. We all know who’s responsible. The blame for this chaos lies squarely with the Conservative Party.
But we also know that the cost-of-living crisis has been made worse by the evil hand of Vladimir Putin. Just as he is waging war by tanks and missiles against the heroic people of Ukraine, Putin is waging an energy war against the whole of the western world. We stand with all Ukrainians as they bravely and brilliantly resist the Russian war machine. Tens of thousands of British families have opened their homes and their hearts to people fleeing for safety.
The UK will continue to aid their fight for their country, their democracy and their freedom. Ukraine’s fight is our fight. But we must resist Putin as he wages his energy war too.
It’s a war that threatens a different kind of misery and destruction, right across our continent. And it’s a war we must win. The UK must fight back – not just by arming and training Ukrainian soldiers, but with a wartime effort at home, to protect the British people from Putin’s aggression.
We must fortify our nation – not just with troops and submarines, but with wind turbines, solar panels and tidal power. And we must insulate every home – not just from the cold, but from the cost of Putin’s gas war.
We must protect the British people – not just from bombs and bullets, but from soaring energy bills today and climate change tomorrow. So I am proud that it was we Liberal Democrats who built up our country’s defences – when we were in Government. Investing in cheap, renewable energy. Building Britain’s clean energy defences. Walls of wind turbines in the seas around our islands.
And I am proud that, again, Liberal Democrats are leading the charge for new defences for Britain. To protect our families and pensioners from Putin’s energy war. Paid for by a windfall tax.
More than a year ago, Liberal Democrats were the first party to argue for a windfall tax on the record profits of the oil and gas giants. And since then, the case for our windfall tax has only got stronger, as those profits have soared even higher for one main reason: a brutal dictator spilling innocent Ukrainian blood. There are no arguments left. The right thing to do – the fair thing to do – is to tax those blood-oil profits. But Chancellor Rishi Sunak said no.
Sunak chose to pass on high energy costs – not to those profiteering from Russia’s energy war, but to those suffering from it – Britain’s struggling families and hard-pressed businesses. And Sunak waited another six months before introducing his so-called “Energy Profits Levy”.
A tax so ineffective, do you know how much Shell paid out on its £26 billion profits? Not a single penny.
My friends, the Conservatives are both totally incompetent and morally bankrupt.
And the Conservatives almost bankrupted Britain too. With their unfunded tax cuts for the super wealthy. Instead of tackling the cost-of-living crisis seriously, they chose to treat the British economy as their own personal playground – Using people as playthings in their reckless game of fantasy economics.
Just look at the damage. For our country: billions of pounds extra on the national debt. Pension funds at risk. Inflation through the roof. Exports through the floor. Predictions of the longest recession in history.
And for struggling families across Britain: A mortgage crisis, with people’s monthly payments up by hundreds of pounds. Millions of families struggling to pay a Conservative Property Penalty, every single month.
Never again can the Conservatives claim to be the party of homeowners. Never again can they claim to be the party of business. Never again can they claim to be the party that balances the books.
The Conservatives are the party of chaos. And now what worries millions of people is what happens next.
After inflicting so much chaos, the Conservatives want the rest of us to pay to clear up their mess. They are already talking about more unfair tax rises. More cuts to pensions and benefits. More cuts to schools. The police. Even our NHS. All to fill the hole they themselves created.
It’s like they’ve robbed our bank, and now they’re asking us for a loan to buy their getaway car!
Well, we say “No.” Rishi Sunak and Jeremy Hunt – Instead of inflicting even more pain on struggling families and pensioners, it’s time to start helping. Put a proper windfall tax on the blood-oil profits of the fossil fuel giants. Reverse your tax cuts for the big banks – they are unfair and unnecessary. And use those extra billions to give people real help with energy bills. To protect pensions and benefits from inflation. To safeguard schools, hospitals and councils from cuts. And to help homeowners struggling to pay that Conservative Property Penalty.
Liz Truss and Kwasi Kwarteng were rightly kicked out of Downing Street for their disastrous policies. But no one else should lose their homes because of them. So today, I’m proposing a new Mortgage Protection Fund, To cover the extra costs for those families seeing their payments rise most sharply. To protect them from falling into serious arrears or even facing repossession.
And it’s not just homeowners who need help. The Conservative Property Penalty is making it even harder for young families to get a mortgage in the first place. So we will keep campaigning too for stronger rights for renters, to give them security in their homes and protection from unfair rent hikes. People and businesses need help now – just to survive inflation this winter.
But they also need a plan to end this recession. To end the chaos and the pain. A plan to get our economy growing strongly again. To create opportunity and prosperity for all. And that plan can’t be the cut-to-the-bone, race-to-the-bottom, trickle-down nonsense we always hear from the Conservatives.
The real answer – the Liberal Democrat plan – is about innovation, investment, trade and people. Innovation: from batteries to biotech. Investment: in every part of the UK. Trade: on our high streets and with the world. Backing local businesses with rate reform. And tearing up the Conservatives’ red tape that’s strangling trade with our closest neighbours – with Europe.
But above all, the Liberal Democrat economic plan is about people. Because you can’t get the economy growing again without the right people, with the right skills, in the right jobs. From construction to care, from hospitality to health, the British economy is being held back by a lack of staff and a lack of skills. So let’s tackle the health crisis, that keeps hundreds of thousands of people off work as they wait for treatment. Let’s offer more training for young people and adults alike. And let’s make the jobs we need, jobs people want to do. By giving people more flexibility, greater security and better conditions at work. So those in work want to stay there. And those who left work after lockdown want to go back.
That’s how you grow our economy. But the Conservatives are doing precisely the reverse.
Neglecting local health services. Threatening more cuts to schools and colleges. And tearing up hard-won employment rights.
All because Rishi Sunak doesn’t understand the reality of most people’s daily lives. He doesn’t get what it’s like for the mum and dad working shifts, who gets told their hours just days in advance. How hard it is to find someone to look after the kids, or to check in on their frail gran. Who don’t know how much they’ll get paid next month. How hard that makes budgeting for the weekly shop.
Rishi Sunak is so out of touch, he even appointed a Work and Pensions Secretary who wants to roll back hard-won maternity and paternity rights.
To grow our economy again, we need a plan for innovation, investment and trade. We need a Government that puts people first. And gives workers a fair deal.
The Conservatives are incapable of doing that. The Liberal Democrats will.
And it’s not just the economy where the Conservatives are failing the British people. It’s just about everything. I have never known our country so badly governed.
Need to renew your passport in time for your holiday? Under the Conservatives: good luck.
Need an operation to stop that dreadful pain in your hip? Under the Conservatives: stack up on painkillers.
Need an ambulance in an emergency? Or an NHS dentist? Under the Conservatives: many people are resorting to DIY.
What has happened to our country under the chaos Conservatives?
I know Conservative MPs were saying everything would magically get better once Liz Truss was gone. Just like they said everything would magically get better once Boris Johnson was gone. That went well, didn’t it? The faces at the top may change, but all the same problems remain.
One of Rishi Sunak’s very first decisions as Prime Minister was to reappoint the awful Suella Braverman as Home Secretary. Less than a week after she’d been forced to resign for breaking the rules. Truss-like judgement, with Johnson-like integrity. Nadhim Zahawi said it was time for Boris 2.0. With Rishi Sunak, it looks like he got his wish.
In fact, the only real shift in Conservative policy has been on the consumption of baked goods. Namely, cake. Under Boris Johnson it was having his cake and eating it. With Rishi Sunak it’s “Let them eat cake”. The Conservatives are still hopelessly out of touch with the everyday lives of British people. They’re still letting you down and taking you for granted.
And it is still our job to hold these Conservatives to account – and get them out of office at the next General Election. At that election, millions of voters will be asking a simple question:
“How do we get rid of our awful Conservative MP?”
And we’ve shown time and time again, that’s something the Liberal Democrats are pretty good at. Take our three historic by-election wins. Sarah Green in Chesham and Amersham, overturning a Conservative majority of 16,000. Helen Morgan in North Shropshire, overturning a majority of 23,000. And this summer, in Tiverton and Honiton, Richard Foord, overturning a Conservative majority of 24,000!
Fantastic. And we didn’t just beat the Conservatives in Devon – We showed Boris the door! But that’s not all. In May, we also secured a fantastic set of local election results. Defeating Labour, the Conservatives and Plaid.
And making big gains in Scotland, taking on the Nationalists, who threaten to tear our precious family of nations apart. And whose obsession with breaking up the UK – at the expense of all else – is causing real pain. But my favourite result of May’s local elections was in Blackmoor Vale, in Somerset.
Where Sarah Dyke and Nicola Clark beat a Tory councillor – the head of a special unit in Conservative HQ. We Lib Dems beat the Tory running the Tory unit dedicated to beating the Lib Dems!
Afterwards, someone asked me if we have our own crack squad specialising in beating the Conservatives. I said yes… It’s called the Liberal Democrats! We win by really listening to people.
Listening to your concerns. Your frustrations. And showing we hear you. Showing we care about the things you care about… Making sure you can afford a decent home, pay the bills, and save for retirement. Access to high-quality local health services, without waiting for weeks. Good schools for your children, where your child’s needs are met. Safe communities, where you and your neighbours are free from the threat of crime.
Clean local environments, where you and your family can enjoy open green spaces and blue rivers. That’s why we launched our campaign to stop water companies pouring tonnes of raw sewage straight into local rivers. Conservative MPs have utterly failed to stand up for their constituents. They have let water companies make vast profits – while getting away with dumping their filthy sewage.
And the regulator Ofwat has been the accomplice in their crime. So I’m calling on the Government to abolish Ofwat, set up a proper watchdog with real teeth, to do whatever it takes to stop the sewage. Steal the Liberal Democrat idea for a sewage tax. Borrow our ban on bonuses for water bosses. And make them finally clean up our rivers.
That’s the sort of fair deal I’m talking about. That’s the fair deal you expect and deserve. And that’s the fair deal we Liberal Democrats are fighting for.
And let me tell you why this fight matters so much to me – personally. Like so many others, my life has taught me about care. About coping with the challenges of family illness. And the importance of our NHS.
I come originally from Nottinghamshire, the youngest of three brothers. Both of my parents were taken from us when we were still young – my dad died when I was four, and mum when I was 15.
That’s why I campaign so much on bereavement. How we should care – more – for bereaved families. And why improving cancer services is so close to my heart. As both my parents died from cancer.
And I’ve spoken before about how I cared for my mum in her final years, my Nanna in her autumn years, and how Emily and I now care for our disabled son, John. I know a little about caring for loved ones. The mental health challenges at school when you’re a young carer. The financial challenges of keeping a deeply loved grandmother in a care home. And the emotional challenges of juggling work and care as a parent.
This week, Emily decided to talk about her own challenges with MS. I am in awe of her. And all the carers who manage their own ill health while looking after others. We know how hard every day can be for family carers – the millions of family carers across our country.
How important their work is to our society and our economy – And yet how forgotten they so often are. So when I look at the challenges facing our country, I do so through a carer’s eyes. And I see a lot that needs to be fixed.
But I want to start by ending the national scandal of millions of people waiting for weeks to see a doctor. The blame for this crisis is clear. It’s not our overworked GPs. It’s the Conservatives. They promised 6,000 more doctors, at the last election – but the number of qualified GPs has actually fallen by 500. And our solution is clear too.
Give everyone a new right to see their GP within seven days. And within 24 hours if they need to. Not an ambition. Not an expectation. Not a target. But a right.
And we know that you don’t deliver on that right by copying the Conservatives’ failed approach. Just setting the targets. Then cutting GP numbers. Then blaming the doctors when the targets are missed. This is about the Government stepping up. To train, retain and recruit 8,000 more GPs. To fix the broken pension rules forcing many doctors to quit. To reduce the pressure on GPs, with pharmacists, nurses and paramedics helping wherever possible. To give doctors the time and the tools to do the job. So everyone can get the care they need.
And there’s one more change we must fight for. A crucial part of our fair deal: A fairer politics.
If there’s one thing the last year has shown us, it’s that our political system is not fit for purpose. First Past the Post distorts democracy. It denies voters a real choice. It incentivises political parties to do exactly what the Conservatives do now: Focus on a small number of voters. In a small number of marginal seats. Ignoring everyone else. And so taking millions of people for granted. We have to stop that.
In the end, for us, as liberals, it comes down to power. And a proportional electoral system would give every voter equal power. And with fair votes, everyone could make their voices heard. Everyone’s vote would have real power.
Voter power to hold every MP to account. Putting power in people’s hands. Holding the powerful to account – that is our liberal mission.
So, Liberal Democrats, let’s make the next General Election the last one to use First Past the Post.
Speaking of General Elections… Why haven’t we had one yet? It’s obvious we need one. The British people demand one. Even that well-known constitutional scholar – Nadine Dorries – now says it’s “impossible to avoid” an election.
So why hasn’t Rishi called one? We know why. Because he knows he’d lose.
He saw what Liberal Democrats did to the Conservatives in true-blue Buckinghamshire, in Shropshire and in Devon. And he knows we will do it again – in seats along the Blue Wall. And right across the country.
Well, being scared of the Liberal Democrats isn’t a good enough reason to deny the British people their say. This is the guy who, two years ago, was telling us all “eat out to help out”.
Well our message to the Conservatives is this: Help out by clearing out.
Rishi Sunak: Your Government does not have a shred of credibility left. It does not have a shred of legitimacy left. If you had a shred of integrity left, you would call a General Election. Now.
But whenever that election comes, Liberal Democrats will be ready. We are the party that will end the chaos. The party that understands the challenges people are facing. We’ll show that we are the party that cares. The party that has a plan. The party that offers a fair deal.
And that’s why we will win.
* Mary Reid is a contributing editor on Lib Dem Voice. She was a councillor in Kingston upon Thames, where she is still very active with the local party, and is the Hon President of Kingston Lib Dems.
Follow @LibDemVoice on Twitter
Like us on Facebook
Subscribe to our feed
Sign-up for our daily email digest
Latest voting intention and leadership ratings opinion polls
Urban ReLeaf Dundee
Welsh Labour hospitality row
Morecambe and Wise and Leonard Rossiter
Joseph Bourke
Colin Brown
Steve Trevethan
Jenny Barnes
David Warren
37 Comments
Good to be able to read it. The link I was sent didn’t work, but I caught part of it on Sky News.
The Libdems have just lost my support again, assuming that the BBC report that Ed Davey is proposing to grant struggling mortgage borrowers £300 per month is correct: https://www.bbc.co.uk/news/uk-politics-63514047
Such a policy might cynically win a few votes but would pour petrol onto a fire that is consuming our country in many ways, which the BoE is doing little more to resist than merely turning down the gas a mark or two. Any borrower who cannot pay more than low single figures percent is frankly a chancer who has not looked at mortgage rate history over a similar timescale as their mortgage will last, and has not allowed themselves a sufficient safety margin, so deserves to have their property repossessed if they cannot pay. And it should not be forgotten that in paying more for a house than they could afford, may well have outbid some other would-be buyer who was more prudent.
I am a natural supporter of the Libdems, but resigned my membership over a similar issue in the early noughties, when the party was supporting a local income tax to replace council tax (while I would prefer LVT, at least council tax is a tax on on-going occupation encouraging economising use of our constrained property supply). My support for the party had recovered to the point that I helped out with canvassing in Chelmsford in 2019. But with such an economically irresponsible, populist proposal, the party has just lost my goodwill again.
The idea of mortgage relief for homeowners experiencing severe financial distress is perhaps a pragmatic response to rising interest rates; and possibly negative equity and repossessions if interest rates rise further. It was always, however, going to be the case that house or more specifically land prices inflated by ultra-low interest rates since 2008 would eventually leave many house buyers with payment problems.
Relief for both mortgage borrowers and tenants is best financed by a Land Value Tax on mortgage lenders based on survey values and the proportion of the land value that is financed by lending.
Council tax would be assessed by local authorities proportional to house values. The element related to land would be paid by landlords/homeowners and mortgage lenders based on their proportional interest in the land. The element related to buildings would be paid by homeowners or split proportionally between Landlords and tenants for rented properties.
A 300k house with a 50/50 land/building value split and 80% mortgage subject to a 0.5% council tax might be assessed as follows:
Council tax £1.5k split – Homeowner £900 and Lender £600; or for a rented property Landlord £450, Lender £600, Tenant £450.
The benefit for the homeowners in this case is a reallocation of 40% of the council tax assessed (which may increase for above median value properties) to mortgage lenders. The benefit for tenants is a 70% reduction in council tax reallocated to Landlords and lenders.
The Land Value Tax approach allocates housing costs relief not solely to mortgagees, but crucially to tenants in the rented sector where it is also sorely needed.
Tim Young 6th Nov ’22 – 2:42pm……The Libdems have just lost my support again….. Any borrower who cannot pay more than low single figures percent is frankly a chancer who has not looked at mortgage rate history over a similar timescale as their mortgage will last, and has not allowed themselves a sufficient safety margin, so deserves to have their property repossessed if they cannot pay……
“Chancers who, if they can’t meet a massive increase in morgage payments, deserve to be put, with their children, onto the street???.. I think this party is better off without you!
Taking on a morgage (or even renting, is ‘taking a chance’.. How many jobs are safe in today’s Britain? Back in the low rates of 2020 a survey showed that in “Insecure Britain – we are two and a half pay cheques away from homelessness on average (A survey found three quarters of us worried that, if their financial situation changed in just one way, they might end up losing their home, or evicted.)
High rents mean that taking on a morgage is no more risky than that of your landlord upping your rent to unaffordable levels..
I struggled to pay my first morgage; and that was back in 1967..
.“approximately one Liz Truss. And that says it all, doesn’t it?”
“High rents mean that taking on a morgage is no more risky than that of your landlord upping your rent to unaffordable levels..”
expats got there before me.
Tim Young – what do you propose to do about all these people likely to end up on the streets? How are they supposed to keep a roof over their heads? Or don’t they matter?
@ Joe,
I can’t see the point of charging lenders LVT. This is £600 p.a, in your example. Won’t they just add it on in fees or the interest charged on any loan? Landlords will pass on any extra costs. Homeowners and renters will still end up paying what is effectively the council tax one way or another.
I can see the appeal to Lib Dem “blue wall” target voters of a mortgage subsidy, but what about renters whose landlords pass on the increased cost of their buy-to-let mortgages?
Where has this policy come from? Has it been discussed before today?
Might it better to oppose the B o E’s socially – economically damaging moves by explaining the realities of the current inflation problems, the causes and socially-economically sounder approaches?
In short, this excessive inflation is particular and not general and so would be better managed fiscally rather than monetarily.
Not a word from Ed about the elephant in the room i.e Brexit. The silence is so frustrating and I wonder if it is time to start thinking about potential successors?
Peter Martin,
Lenders cannot pass on their tax costs to borrowers. The same argument is made that increases in corporation tax will result in increased consumer prices, even though there is no historical evidence to support the assertion. As with any business, lenders compete for mortgage customers on the basis of price and their volume of lending (and hence profits) is determined by what borrowers can afford and are willing and able to pay from their income. Repossessions are a loss of a customer and future interest income for lenders. Lenders and housebuilders do benefit directly from subsidies like help to buy via inflated house prices and the associated interest income from larger loans.
Likewise with taxes on landlords. Landlords compete for tenants and charge what the market will bear based on supply of rental properties in any given location. Rents are not determined by property costs (in many cases properties bought several years ago), but rather by the income profile of a local area. That is why rents for similar size properties can vary so much from one area of a town to another and rents don’t go down when interest rates fall to low levels. Two landlords with the same type of property in the same street will charge similar rents even if one is paying interest on a mortgage and the other has no mortgage. If the rents are too high for the area there are no takers, rents will begin to fall until a level of equilibrium between supply and demand is restored while growing numbers of adults remain living with parents or living in temporary council accommodation and on the housing waiting list. Landlords don’t want to lose paying tenants when rents are starting to decline in a recession and cannot easily pass on extra tax or increased interest costs to their tenants.
No mention of the government’s callous and inhumane treatment of asylum seekers. No mention of the terrible conditions at Manston. No mention of the horrific plan to deport vulnerable people to Rwanda, which Suella Braverman has said is still her “dream”. Ed did criticise Suella Braverman, but only in the context of mentioning that she “broke the rules”, by which he is presumably referring specifically to the email. No criticism of her disregard for human rights.
Just one obliquely coded reference to Brexit “… tearing up the Conservatives’ red tape that’s strangling trade with our closest neighbours – with Europe”, yet Brexit is at the root of much that is wrong in UK politics today.
Economic problems are worse for the UK than other European countries. The UK is falling further behind Germany as a result of Brexit. Only the UK amongst G7 countries has failed to catch up on the drop in economic activity caused by CoVid. Braverman’s fanning of the flames of xenophobia, demonising those seeking refuge from persecution also has its roots in Brexit and the Brexit campaign. The political dysfunction of the Conservative Party (and why Braverman is a minister) stems from the irreconcilable promises of Brexiters.
Ignoring reality never wears well. Reality always comes back with a vengeance. The consequences of Brexit are a reality that our leaders should have the courage to confront directly. I agree with Marco.
@ Martin,
” The UK is falling further behind Germany as a result of Brexit. Only the UK amongst G7 countries has failed to catch up on the drop in economic activity caused by CoVid. ”
I can understand why you want to make this kind of claim. But is it true? Do you have a reference?
I have just Googled {GDP UK} and {GDP Germany}
The figures for the UK are $2.879 trillion in 2019. $3.187 trn in 2021. This is an increase of 11%
For Germany, they are $3.888 trn in 2019. $4.223 trn in 2021. An increase of 9%
So not only has the UK actually recovered in GDP terms, contrary to your claim, it has recovered faster than Germany.
@ Joe.
Thank you for your reply. However, we are both saying the same thing albeit is slightly different ways. You’ve put it that:
” [the lenders] volume of lending (and hence profits) is determined by what borrowers can afford and are willing and able to pay from their income”
and you also are saying that it works the same way in the rental market.
“Likewise with taxes on landlords. Landlords compete for tenants and charge what the market will bear based on supply of rental properties in any given location.”
In your example you have shifted £600 of what would be council tax currently paid by homeowners and tenants on to lenders and landlords. So, if the former are now £600 better off they will now be considered able to afford to pay higher rents and higher interest payments.
Theoretically, we could make landlords responsible for all council tax payments. It wouldn’t make any real difference – unless the tenants defaulted. The tenants will still have to pay via their increased rents.
@ Martin “The consequences of Brexit are a reality that our leaders should have the courage to confront directly”.
Completely agree with Martin. Bland timidity on Brexit by the current leadership convinces nobody and is in fact counter productive……. especially for a self evidently small party with no realistic prospect of forming a government on its own. What’s needed is the courage demonstrated by Charles Kennedy during the Iraq War (and which did boost the party’s standing and self respect at the time).
Pursuing soft Tory votes in the Home Counties by not offending anybody is to build castles in the sand…… eventually the tide will come in and wash it all away.
I thank expats and nonconformistradical for their responses.
I would approve of providing relocation assistance to expedite the repossession process, and protection of those forced into default by unforeseeable bad luck, such as ill-health. But to maintain the natural stabilising force, where people reject high prices that they are not reasonably confident of being able to pay, it is essential that those who have got themselves into that position at least do not gain from it. And, on the other side, spending tax revenue on bailing out defaulting mortgage borrowers adds, for those they outbid for a house, the insult of having to contribute something to the bail out, to the injury of having been frustrated in their ambition to own their own home.
I would urge anyone critical of my view to put themselves in the position of those would-be buyers who stood aside when they felt that the price was too high. I am fortunate to now own a paid-up house, but I have not forgotten how I felt in the would-be buyer’s position in the late-1980s as the Lawson boom was allowed to generate inflation over 10%.
Since repossession and resale does not destroy any housing, it is not going to have a net effect of putting anyone on the streets without a roof over their heads. What repossession does mean is that someone else, who is without their own housing perhaps because they were commendably prudent, gets their chance at home ownership.
@Martin…
Average inflation rate in the EU currently runs at 10.7%..
The unemployment rate amongst many EU countries is significantly higher than GB …
Asylum seekers are held in terrible conditions in Greek jail’s .
Only last year they met with razor wire , batons , shields, & water cannon . 19 froze to death on the borders of the EU…
The EU pays a dysfunctional Libyan government with an appalling human rights record to police its waters & return asylum seekers to its shores where they are held in awful conditions…
Britain should take no lessons from the EU when it comes to asylum seekers welfare…
Peter Martin:
https://www.theguardian.com/politics/2022/oct/20/trade-from-uk-to-eu-16-lower-than-if-brexit-had-not-happened-report-finds
and
https://www.esri.ie/news/brexit-reduced-overall-eu-uk-goods-trade-flows-by-almost-one-fifth
Peter Martin:
For recovery from COVid: https://www.theguardian.com/business/2022/sep/30/uk-is-only-g7-country-with-smaller-economy-than-before-covid-19
Also Mark Carney (FT report – I know some say the measure tends to exaggerate, but even half as much would be very significant) https://www.ft.com/content/f1f0a66a-fa2c-4d70-9874-8003bdb3fb53
Martin Gray:
You miss the point.
It is not ‘the EU’, you are referring to particular EU states where xenophobia has also been weaponised for political advantage. Italy is an obvious example. It is a fact that France and Germany take in more than twice and more than thrice the UK intake of refugees.
Unemployment? – Not really true because the comparison is not like for like, not all countries have the political need to exclude many unemployed from the official figures.
Inflation can be mitigated by growth. Prospects for growth are generally better in the EU.
@ Martin,
I don’t know if it is my scientific training but I do like graphs. I don’t see any of those in your references. Comparing quarterly results is just like cherry picking two points on a noisy graph. The first quarter of 2021 is particularly suspect because of stockpiling in the previous quarter in anticipation of actually leaving the EU. It’s the sort of tactic used by climate change deniers to try to claim that the earth isn’t warming or that the polar ice sheet isn’t contracting.
There were graphs in my references and annual rather than quarterly figures in the points that I highlighted. Even annual figures aren’t enough to conclusively prove the point but nowhere near as bad as quarterly figures.
Surely the years since the Brexit vote and the series of incompetent ill thought out policy decisions by our right-wing government would make the most ardent of Brexiteers think again about whether it was wise to believe the politicians who told us we would ALL be so much better off outside the EU?
@Martin….
https://www.amnesty.org/en/latest/news/2022/01/libya-eu-conditions-remain-hellish-as-eu-marks-5-years-of-cooperation-agreements/
Supported by France & Germany…
Unemployment rate in the EU is double the UK rate ..
In some countries Spain/Greece it’s four times the UK rate .
Sorry Barry,
That’s not the way it works.
Just as one ex PM could never own up to being a liar, a philanderer and a cheat and one ex President could never admit that he was a liar, a philanderer and a rabble rouser (putting that bit politely), their followers could never admit that they themselves might be the problem.
C’est la vie.
Indeed Martin (Gray), Our government’s Brexit incompetence has led to too few workers!
Which, if you give it a bit of thought is even worse than having an excess.
@David Evans – Our government’s Brexit incompetence has led to too few workers!”
Unfortunately, Brexit has simply made what has been going on for decades obvious.
It was obvious in the 1980’s (when I was founding start-up IT businesses) that traditional British business and the Conservatives didn’t in general believe in investing in people who actually lived in the UK. Combine this with a disregard for working conditions and it becomes obvious why we have a shortage of HGV drivers, GP’s, other clinical professionals, teachers etc. and why the building regulations are so many years (decades even) behind the curve (bringing them up to date would have required the major builders to actively invest…).
Personally, it is one of the few benefits of Brexit, another is an economy with some slack and so room for the transformational change necessary to achieve our climate change and environmental obligations.
Interesting article. https://www.newstatesman.com/quickfire/2022/11/mps-help-for-renters-housing
This is a typically LibDem speech, combining a selection of policy proposals with attacks on the Tories but rooted in the established Overton Window and with only modest hints at a different analysis of the issues.
And that’s a problem.
Politics advances though ‘regimes’ which offer an overarching analysis of issues and corresponding policy solutions. In my lifetime there have been two, a Labour-dominated ‘regime’ from 1945 which broke down in the 1970s and subsequently a Thatcherite/neoliberal ‘regime’ advocating for ‘free’ markets and hence deregulation, privatisation, etc. That regime has now decisively collapsed leaving us rudderless in a storm. Endlessly rearranging the policy deckchairs isn’t going to work.
In politics, as in Tech, key innovations come from the margins.
Hence the Tories have dominated the last 40+ years because in the early 1970s a small group of activists developed the ideas that eventually became Thatcherism.
Similarly, the multiple metastasising crises the country now faces are a once-in-a-generation opportunity for LibDems to smash the glass ceiling with a credible plan based on an insightful analysis of the issues.
Even better – that new thinking exists in outline, is profoundly Liberal IMO, and is struggling to find political expression.
But it’s not clear that the formal policymaking process can help – it’s all about centralising and building consensus, an approach that inevitably overweights established thinking at the expense of innovation from the margins.
Is anyone else interested in finding a way round this impasse?
@ Roland – Exactly.
The things you list are all examples of what Daron Acemoglu & James Robinson describe as ‘extractive’ approaches to governance in their book ‘Why Nations Fail: the Origins of Power, Prosperity and Poverty’.
Countries with ‘extractive’ approaches fail as we are seeing in real time in the UK. Unfortunately, it could get a lot worse if we don’t get some proper national leadership soon.
Peter Martin,
perfect self-equilibrating markets exist in theory only. Given time, rents and house prices may eventually adjust to lower levels of disposable income leaving sufficient for bare subsistence in many cases. They have been stagnant in Japan for 30 years after their financial crash of 1991. However, rapid disruptions of the kind we have seen in the UK mortgage and rental markets does not allow time for supply and demand to adjust to lower levels of real income. What we get instead is increased homelessness, repossessions and increasing unemployment. Escalating mortgage and rent payments make housing payments (rent/mortgages, utilities and council tax etc) from current income levels unaffordable for many and disrupt the workings of the housing market.
To correct these imbalances requires a market intervention that returns part of the economic rents/super profits earned by lending institutions and/or landowners with low borrowings to the occupiers of properties that are paying the significantly increased mortgage and rental payments on top of existing council taxes and much higher utility costs.
Landlords do pay council tax directly in the case of student accommodation and the increasingly common feature of houses in multiple accommodation. These costs are incorporated in the rents charged and the rents charged are driven by demand for the accommodation (i.e. supply of tenants that can afford the rents) rather than costs plus mark-ups. The main element of housing costs is the price paid for land. Land is a naturally produced resource that has no produced costs just like oil and gas which is not sold on the basis of production costs but market prices. The price of Land is ultimately based on the market forces of supply and demand where it is located i.e. the price at which title changes hands when bought and sold.
Good stuff attacking the worst government ever and stuff for headlines, but at some point we need a serious set of policies.
We are in a new era. Globalisation is sharply in reverse. Long supply lines no longer work, China is being sanctioned on high tech and will not longer be able to assemble planes or products and arms that require medium to high end semi conductors (chips). Huwawei Telecoms have been extracted from the west. USA is reshoring manufacturing at a phenomenal rate and is planning to retain the vast majority of it’s sourcing,energy and manufacturing within NAFTA.
The extreme free market idea of Global Britain will never work, ever.
We will need to rely on near neighbours and ourselves as much as possible, which makes the EU & EEA more vital, not less. We may also need more of a Navy as USA becomes less and less interested in policing the oceans.
John 7th Nov ’22 – 7:21pm:
We are in a new era. Globalisation is sharply in reverse.
In the real world global trade is at record levels…
‘Global trade hits record $7.7 trillion in first quarter of 2022’ [July 2022]:
https://unctad.org/news/global-trade-hits-record-77-trillion-first-quarter-2022
It would be be even higher if there was more capacity…
‘Surge in container freight rates choking global trade’ [February 2022]:
https://thehaulagenews.com/surge-in-container-freight-rates-choking-global-trade/
Consequently, orders for new container-ships are at record highs…
‘Container-ship building spree not over yet; new orders still rising’ [June 2022]:
https://www.freightwaves.com/news/container-ship-building-spree-is-not-over-yet-new-orders-still-rising
Global trade is likely to continue to grow, albeit at a slower pace, helped by cheaper freight rates as shipping capacity is expanded.
NAFTA
Was replaced by the USMCA from 1st. July 2020.
@Gordon. The formal policy process may try to produce a consensus view but it still manages to produce more radical and coherent platform than our parallel policy making process of leaders’ speeches and bye-election leaflets.
@ Peter Davies.
It depends on what one sees as ‘radical’. For me it means getting to the root of problems – finding their causes and addressing those; not just treating symptoms.
For example, some might think UBI ‘radical’ because it represents a novel approach to reducing the unacceptable levels of poverty so many experience. Well, perhaps it will do some good and perhaps there is a place for it BUT the real question is surely why is there so much poverty and why is it so intractable?
Those questions lead naturally to asking why our economy isn’t generating enough good quality jobs (and hasn’t for a long time) for everyone from top professionals to skilled trades to labourers.
Part (just part) of the answer to that is training, again at all levels. For example, we aren’t training enough doctors and nurses, so we import them thus denying our own people those good careers. When it comes to trade skills the situation is arguably worse.
Yet there is no proper system of providing QUALITY training despite the old saying about ‘teach a man to fish…’ and even though we know the availability of skilled labour is one of the top motivators for inward investment.
Only this year have Lib Dems belatedly set up a working group to look into training and skills. Hopefully it will do more than just commit to, in effect, doing the same as before but better.
As I wrote above, high UK housing costs ruin the UK economy in many ways (too many to mention), and I would say that one of them is lack of skills training.
That is because, while our wages may appear to be inadequate for those looking to build their lives in the UK, they make the UK an attractive place, especially for single men, to come and work, because high housing costs drive up our wages in international terms, making them look quite good if you intend to live extremely cheaply in the UK, and remit most of your earnings abroad, where they can support, including housing, a family quite comfortably. That makes it more attractive for UK employers to source ready-made skilled, flexible workers from abroad, rather than training local hires. I dare say that resentment about UK natives being undercut by such workers contributed to the Leave vote in the EU referendum too.
You could of course simply decree a halt to such immigration, and force UK employers to bear the costs of that training in addition to indirectly bearing some of the UK’s high housing costs, but that would put UK business at an international competitive disadvantage. It is hard to exaggerate the ruin that high housing costs cause to the UK economy. High housing costs which Ed Davey seems to be trying to outbid his political rivals in supporting.
In his seminal work “Progress and Poverty” Henry George sets out to answer the question of why poverty tends to increase, rather than decrease, as societies progress and build wealth. He asserts that all wealth is the product of labor applied to land. Capital can be used to multiply the productivity of labor, but it is not essential to produce wealth.
Thus, George argues, the limiting factor preventing people from generating wealth is not a lack of access to capital but a lack of access to land. The landowner who charges rent for the use of land, takes the wealth generated by labor applied to land without doing any work himself. This leads him to the conclusion that poverty amid progress is due to the private ownership of land, which leads to the monopolization of access to land and the charging of rent to anyone who would wish to use it.
Much of the lifetime earnings of working age people and the self-employed today is absorbed by rents or Mortgage interest on borrowings to acquire land. The extraction of these economic rents on top of taxes on earnings leave only sufficient to cover the bare necessities of life from the economic value produced by the general population. George’s answer to poverty was to shift taxes from earned income and profits to the economic rents derived from land and relive the working population of the burden of heavy taxation on their income.
Re-affirming commitment to proportional representation is great. But why not mention how you intend to implement the motion passed in 2020 on rejoining SEM & CU on the path to rejoining the EU? This is the most unique aspect difference between the LibDems and the rest.