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Archives for June 2010

Budgeting for austerity?

Patrick Burns | 05:42 UK time, Monday, 21 June 2010

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Cabinet meeting

In a week that's seen George Osborne present his austerity budget aimed at keeping Britain off "the road to ruin", the government finds itself accused by its political opponents, including the unions, of putting the fragile economic recovery at risk.

They warn cutting the public sector also impacts on jobs in private sector firms who supply goods and services to bodies including local authorities.

It is important to bear in mind that the public spending cuts and tax increases are the "stick" element of the government's "stick and carrot" approach. The "carrot" part is a series of incentives to kick-start growth and create jobs: the National Insurance "holiday" would save firms in regions like ours 5,000 for each of up to ten new jobs they create in regions like ours. But the "stick" part is the tax rises, notably VAT up to 20% and the new top rate of 28% Capital Gains Tax.

So is this austerity budget "unavoidable" as George Osborne says, or is it "reckless" as the acting Labour Leader Harriet Harman insists, pointing to the risk of that dreaded 'double dip' recession?

This is the debate we'll be taking up live on the Politics Show (Sunday BBC One at 11am) with her husband Jack Dromey, formerly of the Unite union and now the Labour MP for Birmingham Erdington; while the coalition government will be represented by the newly-elected Conservative MP for Stafford, Jeremy Lefroy and by the Chair of the Liberal Democrat MPs, Lorely Burt, re-elected as MP for Solihull.

So what's the background to the debate here in the Midlands?

Our region has just seen its seventh consecutive monthly fall in unemployment, down by 9,000 to 240,000. This compares with a figure of over 280,000, equivalent to a city the size of Wolverhampton when the recession was at its worst.

It also contrasts sharply with the national statistics which show unemployment rising again, prompting Labour's Shadow Chief Secretary, Liam Byrne MP to warn ministers their austerity measures could trigger the dreaded "double dip" which his government had fought hard to stave-off.

And despite the generally more encouraging picture on jobs, his Birmingham Hodge Hill constituency remains near the top of the national league table for people claiming unemployment-related benefits.

Birmingham Ladywood's Job Centre is also constantly one of the busiest in Britain. Its manager Jean Harborne told me earlier this year that her staff have been able to find increasing numbers of vacancies. The problem was keeping up with the new job-seekers landing on their books all the time.

So a rather patchy picture starts to emerge: chronic deprivation and long-term joblessness in some places, but clear signs of recovery in others. After the dark days of 2008-9, Jaguar Land Rover report their biggest jump in sales in 60 years.

When I met the firm's new Chief Executive Dr Ralf Speth recently at his first media briefing since taking-on the job, he was extremely bullish. Despite the firm's plans to close one or other of their Solihull or Castle Bromwich plants he was adamant that it was not his intention to "let anyone go". On the contrary, he hoped JLR would employ more people here, not fewer.

But he did have one big concern: that our universities and colleges needed to step-up the supply of skilled young people, especially engineers. JLR work closely with Warwick University's manufacturing group but overall there's still a dearth of top talent.

How ironic, I always think, that a region which for most of the 20th century was world famous for its skilled workforce now finds itself short of this most precious commodity. And how does this square with the Government's plans to scale-back Labour's planned increases in higher education places? Back to those public sector cuts again.....

For a different perspective I turned to another private sector firm where business is booming. It's an ill wind....! Personal Career Management have just celebrated the opening of their swish new offices in the centre of Birmingham.

They aim to help everyone from anxious young graduates to increasing numbers of senior professionals who find themselves looking for work. The firm's boss, Corinne Mills is the author of "You're Hired", the best-selling guide setting out how to sell yourself in that all-important CV

She speaks movingly about the top HR executive who'd been dealing with challenging personnel issues in a major employer only to find the biggest challenge was his own redundancy.

The starting point for Corinne Mills was the vision, originally set out by Professor Charles Handy of the London Business School, of the 'portfolio career', Like him, she aims to empower people to take control of their own destinies. How I'd love to see one of those "Apprentices" stand up to Alan Sugar and tell him that 'He's' fired because they've found a job somewhere else which better suits their long-term career design.

However, sadly, she admits that's simply not the way things look for many of the people her firm deals with, struggling to make their way in the most challenging jobs market in living memory.

We'll be taking up these challenges on this Sunday's Politics Show (BBC One at 11am).

And we'd like to hear you views on that question whether the Budget is "unavoidable" or "reckless". Email your comments to bbc.co.uk/politicsshow, remembering of course to click on the West Midlands link.

New hospital, new politics

Patrick Burns | 11:02 UK time, Tuesday, 15 June 2010

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Storer.jpg
"We didn't just mend the roof. We built the whole hospital!"

Launching Labour's election manifesto on April 12, Gordon Brown summed up the significance of the gleaming new building in which he was joined by his cabinet colleagues.

So this is what you get for half a billion pounds. The gigantic Queen Elizabeth superhospital dominates the South Birmingham skyline for miles around.

How ironic, then, that this compelling symbol of Labour's 13 years in power, should open just a few weeks after the party's defeat.

That's just the latest in the series of political twists and turns that have surrounded the mammoth construction, known affectionately by locals as "the three commodes": it is at least a remarkable example of contemporary architecture!

The Private Finance Initiative, or PFI, which delivered the funding was the invention of the last Conservative government, fiercely contested by Labour in opposition: bringing private investment into the NHS was tantamount to privatising the NHS, like mortgaging our hospitals' future.

Then came the u-turn. Enter Alan Milburn as a health minister in the New Labour government to declare: "if it's new hospitals you want, it's PFI or bust!"

And Birmingham's Superhospital was one of the biggest. And just to compound the highly-charged politics, it happens to be in the Birmingham Edgbaston constituency of Gisela Stuart, which had been the first marginal seat to declare Labour's 1997 election landslide.

Ms Stuart was a health minister herself during the early stages of the project to replace both the old Queen Elizabeth and the neighbouring Selly Oak hospitals.

She was at Tony Blair's side during the 2001 election when the then prime minister was famously confronted by Sharon Storer, whose emotional attack on the cancer treatment being given to her partner at the old QE became one of the defining moments of the campaign.

It reinforced Labour's determination to press ahead with the construction which at its height was crowned by the tallest free-standing cranes in Europe.

Meantime the Conservatives had ambitions of their own in Edgbaston: before 1997 it had been one of their safest seats. They'd narrowly failed to win it back in 2005, but surely 2010 would be their year.

Gisela Stuart had other ideas. No longer in the government and she used the freedom of the backbenches to attack Gordon Brown over his refusal to hold a referendum on the Lisbon Treaty. Even Edgbaston's "instinctive" Tory voters in Edgbaston gave her their grudging respect.

But boundary changes had squeezed her already slender majority into a "notional' knife-edge of just 1,500.

Of all my memories that dramatic election night on May 6th, the one that stands out is of Labour supporters at the Edgbaston count in Birmingham's giant National Indoor Arena suddenly cheering and doing high-fives! High fives?

When all around them was despair and disappointment! Not for Gisela Stuart. She had confounded many a confident prediction, by hanging-on in Edgbaston by 1300 votes. If the rest of her party had done anything like this well, the story of the 'New Politics' would have been very different.

So, as the superhospital opens, she speaks with renewed personal authority in a party beginning a reconstruction project, not of a superhospital, but of its own rehabilitation unit.

So who's she backing for the Labour leadership? She's one of just 3 Midlands MPs who've so far kept their powder dry on the question. Until this coming Sunday morning that is!

Gisela Stuart will join me live on the Politics Show at 11 o'clock on BBC One, when she'll exclusively reveal her choice. With us will be a panel of her party colleagues to debate the merits (and demerits!) of the challengers.

Which leads to our final political twist. Having "invented" the PFI, the Conservatives signalled they'd cooled off the idea during their election campaign; that it offered a far better deal to the private investors than the taxpayer. And that was before the dawning of the "Age of Austerity" ushered in under the 'New Politics'.

Make the most of that superhospital. It'll be a while before we see its like again.

You're fired!

Patrick Burns | 10:49 UK time, Tuesday, 8 June 2010

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Fire engine

Suddenly it's no longer just Alan Sugar's catchphrase.

Thousands of people working for private companies were first to feel the flak as the recession took its grim toll over the past 18 months. But now the public sector is in the firing line with a vengeance.

And as the government prepares to sharpen its axe, anything with the word "regional" attached to it seems particularly at risk of being chopped.

Two weeks ago my blog examined the uncertain future awaiting the region's biggest quango, the regional development agency Advantage West Midlands.

Rather less attention has so far been paid to the outlook for a network of regional fire control rooms planned under Labour. This is probably because no one actually works in them!

The introduction of a system of regional call centres is running at least two years behind schedule and the Fire Brigades Union reckon the West Midlands centre near Wolverhampton will not be ready for at least ANOTHER two years! (Though the Labour Government disputed this).

What isn't in dispute is that the main cause of the delays is (surprise surprise) a problem with the new IT system.

The Politics Show (BBC One, Sunday 14th February 2010) carried exclusive first pictures from inside the Midlands' call centre on the Wolverhampton Business Park. Its gleaming interior and high-tech data screens looked futuristic enough. But not a human being in sight.

The big idea behind the £420 million network of nine regional centres including this one was to bring a coordinated, "joined-up" approach to the fire and rescue services: to make sure they all used compatible digital technology and that in the post 9/11 environment, they were more resilient to the threat of terrorism than the current patchwork of five county fire and rescue call centres across the Midlands.

The then government pointed not just to major fires but also to the epic floods of three years ago. Gloucestershire's call centre was overwhelmed. Its so-called "buddy" call centres in neighbouring shire counties were themselves fully-stretched. How much better to have an integrated national system where less hard-pressed regions could help their embattled colleagues elsewhere.

But the Conservatives in opposition, were scathing. Yet another Whitehall IT project was running out of control they said. If they came into office, they stop throwing good money after bad and scrap it. Instead they proposed county-based centres bringing together nerve-centres for all three emergency services under one roof.

Enter the coalition government, which pledged to accelerate still further the pace of public sector cuts. It would surprise no one if the fire and rescue centres were high on the list.

Though the previous government disputed the figures, the Fire Brigades Union reckoned the cost of finishing the West Midlands Regional Centre was running at a staggering £5,500 per day!

All this at a time when Fire and Rescue services in counties including Warwickshire are considering closing fire stations and making firefighters redundant. So how does this tally with the government's oft-repeated determination to concentrate Britain's scarce resources on front line services?

Sounds as though we have the makings of a debate doesn't it. And you'll be able to see it for yourself on The Politics Show this Sunday, June 13, at the earlier time of 11am on BBC One. Perhaps you have your own views about this already. Let us know what you think. Send us an email at bbc.co.uk/politicsshow


Who needs a heavy-hitter?

Patrick Burns | 10:04 UK time, Tuesday, 1 June 2010

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Lord Mayor of London


"A city like Birmingham needs a heavy-hitter at the top of whom even Cabinet ministers are just a little afraid". So said the then Local Government Minister Nick Raynsford in the early days of the New Labour Government.

He had come to the city to promote his vision of a directly-elected mayors in a long list of towns and cities the length and breadth of England.

Almost a decade has passed since Birmingham's voters overwhelmingly rejected the idea in a referendum. Stoke-on-Trent is the only Midlands city to have taken the Government up on the offer, only for voters there to reverse their decision and scrap the elected mayor after just two terms.

The city's second elected mayor, Labour's Mark Meredith, left office last year after a storm of protests on the streets and bitter recriminations within the council itself.
So why has the argument surfaced yet again?

Answer, because David Cameron's Conservatives have named Birmingham and Coventry on their list of 12 major cities where they are prepared to force a referendum on the issue, over the heads of generally reluctant local councillors.

The Conservatives are also the senior partners in Birmingham's ruling "progressive partnership" with the Liberal Democrats. Its leader, Mike Whitby has been one of the most implacable opponents of elected mayors from the start, arguing that it would concentrate too much power into a single pair of hands.

He also points out that we do not have a presidential system in this country: as at Westminster, the leader is elected from within the body of the council rather than directly by the voters.

To which the instant riposte is of course: where have you been for the past 30 years? Politics locally and nationally IS, in fact, increasingly presidential, whatever the constitutional niceties may suggest. Just look at what heavy-hitting Ken and Boris have done for London!

It should certainly keep things interesting during the run-up to the Conservative Party Conference in Birmingham in October when Councillor Whitby will play host to Mr Cameron's first conference as Prime Minister.

Inevitably, speculation is already rife about likely runners and riders. The former Labour MP for Birmingham Erdington Sion Simon stood down at the election, he said, specifically to prepare his campaign for the elected mayorship.

He said his experience as a junior minister had shown him just how unequal the relationship was between central and local government. For the Conservatives, the Sutton Coldfield MP Andrew Mitchell was the Shadow Minister for Birmingham in the last Parliament: but would the International Development Secretary to consider leaving his seat at the Cabinet table to throw himself at the mercy of Birmingham's voters?

And the Liberal Democrat MP for Birmingham Yardley John Hemming was his party's group leader on Birmingham City Council when that partnership was formed with the Conservatives six years ago.

But perhaps voters will want to depart from conventional party politics. There is no shortage of possible independent contenders. It's nearly four years now since the then Sir Digby (Now Lord) Jones (of Birmingham) told me in an exclusive interview that if a vacancy existed he'd consider throwing his hat in the ring.

The former managing director of Birmingham City Football Club Karren Brady always gets a mention on the rumour mill, and so does Birmingham University's high-profile history professor Dr Carl Chinn.

As for the likely timescale, the Conservatives said when they first mooted the idea that they would commit to the local referendums being held within a year of Mr Cameron taking office, which would mean May next year.

But that was before the scale of the public spending cuts had emerged, and now hard-pressed local authorities are lobbying ministers furiously behind the scenes against any headlong rush. They say the cost of the reorganisation that would follow a "yes" vote, to say nothing of the referendum itself, would be an extra burden which they could do without for the time being thank you very much.

Stand by for a confrontation: the Communities and Local Government Department told us today they're preparing for "early legislation"!

What do you think? It's our main talking point on the Politics Show next Sunday in our usual slot of 12 midday on BBC One. Let us know your thoughts by emailing through the website bbc.co.uk/politicsshow, remembering of course to click on the West Midlands link.

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