BBC News (2001-Present)

[Blakesley]

Public appointments bill fails to pass Commons



The Public Appointments Comprehensive Reform Act, a joint initiative of the Conservative Party and Liberal Democrats, failed to pass second reading in the House of Commons today. The vote was 302 in favour and 352 opposed. The Labour government was joined in opposition by the Scottish National Party, Plaid Cymru, the Ulster Unionist Party, and Social Democratic and Labour Party.

Early hopes inside the Conservative Central Office were that enough members of the Socialist Campaign Group would support the legislation that they would be able to prevail and pass it over the objections of Dr MacAndrews and her government. However, while some members of the Socialist Campaign Group did back the legislation, it was an insufficient number to change the outcome.

Parties generally favouring devolution opposed the legislation, which could have resulted in a Westminster-based body gaining more authority over devolved institutions. In particular, the Ulster Unionist Party opposed the legislations, despite a rumoured personal plea from the Leader of the Opposition, William Croft, to back it. "We view legislation that may transfer oversight powers from Stormont to Westminster, or prevent the future devolution of those powers, to be in violation of the Good Friday Agreement," said David Trimble, the UUP leader. Mr Trimble and John Hume, the SDLP Leader and MP for Foyle, agreed on a position in support of devolution in Northern Ireland ahead of the vote.

The failure of the legislation coincides with the creation of a Royal Commission on appointments reform, announced by Dr MacAndrews recently in Parliament. The commission is to be chaired by Lord Norton, a Conservative peer and professor at the University of Hull. Lord Norton previously chaired a commission advising former Conservative Leader William Hague on the constitution and now chairs the House of Lords Constitution Committee.

Said one political commentator, "Hopefully we can shelve this issue until the Royal Commission reports back. The public are increasingly looking at this debate and seeing politicians focused more on appointments than public services. Political advisors in party HQs across Westminster need to emphasize to the politicians just how little the public cares about this."

[Blakesley]

Markets react positively to Chancellor’s budget
November 2001



Markets reacted positively following the release of details surrounding Chancellor of the Exchequer Sir Jack Anderson’s first budget.

Details of the fiscal plan resulted in a noticeable rise for the FSTE 100 during trading after the announcement. One analyst noted that, “It’s the size of the surplus, in part. A number of companies are expecting the cost of borrowing and debt to decline in the near future.”

Activity on gilt markets saw rising prices, an expected outcome as the sale of debt declines as a result of the size of the surplus. The rising price of gilts corresponds with an overall decrease in their yield. “British debt, right now, is viewed as being an incredibly safe investment. The fiscal discipline imposed by the Chancellor is paying off macroeconomically.”

As gilt yields decrease and gilts cycle, the amount of interest paid on the debt decreases over time. This is impact is combined with the decreasing amount of overall debt, which results in lower debt interest payments as debt is retired.

Other commentators noted that, "The surplus probably could have been smaller and achieved the same result. This was a tight fisted budget, no way around it. The positive macroeconomic effects would still be seen had the Chancellor opened the taps more. Being conservative with tax and spending doesn't always pay off, it just happened to this time."

Sources close to the Bank of England’s Monetary Policy Committee suggest that there may be an interest rate cut in the coming months. “The Bank of England is seeing global economic headwinds abroad and a budget that is designed to keep spending in check at home, that’s going to lead them to think it’s safer to pursue interest rate cuts now. Had the Chancellor gone for a bolder investment package, that move may not have been in the cards.”

In an official statement, a spokesperson for the Bank of England said, “The Governor and the Monetary Policy Committee are monitoring the fiscal situation, the state of the global economy, and economic indicators constantly and will reach a decision on interest rates based on that.”

[Blakesley]

Commons endorses Section 28 repeal
December 2001



The House of Commons backed the repeal of Section 28 by a wide margin following a spirited debate over the government's legislation. The legislation passed by a vote of 478-169, with over 70% of MPs voting in favour of the legislation.

The debate in the House of Commons covered issues ranging from morality to crime and child abuse to education and support for students. The debate featured a question as to whether Scottish MPs should be eligible to vote on this legislation. The Scottish Parliament repealed Section 28 in Scotland last year. The votes of Scottish MPs ultimately did not provide the margin of victory necessary for the legislation, which commanded the support of a large number of English and Welsh MPs.

Our political analyst summarised the passage of the legislation as a win for the government, but not one that would likely see significant changes in public opinion. "Public services and the economy are the issues on voters' minds right now and that cannot be overstated, for both parties." Despite a rebellion of nearly a quarter of their parliamentary party, the debate may have a benefit for the Conservative Party. "The reality is that polling was starting to show core Conservative voters as wavering. This debate may have helped solidify their support for the Conservative Party or at least turned them off of the Liberal Democrats a bit. This isn't a gain, but it may help stop the decline the Conservatives saw in the polls."

The legislation now moves to the House of Lords where it faces a more united Conservative opposition than in the House of Commons. However, insiders commented that blocking the legislation would be a violation of the Salisbury convention, which prevents the Lords from blocking legislation that fulfills government manifesto commitments. It is unknown whether the Prime Minister, Dr MacAndrews, is entertaining the use of the Parliament Acts to pass the legislation.

[Barclay A.A. Stanley]

William Croft Resigns

William Croft, leader of the Conservative and Unionist Party, resigns as leader today. The Tories will begin the process of electing a new leader.

DECEMBER 2001

Just 6 months after being elected leader, the beleaguered Tory boss, William Croft, has today announced his resignation pending the election of a successor. The 38 year-old Member of Parliament for Chipping Barnet failed to connect to the public, leading the Tories to some of their lowest polling levels in the party's history with experts projecting a result worse than the Tories' 1997 election.

Mr. Croft faced near constant in-fighting within his party which sources from inside Conservative Central Office say distracted the leader from the work he needed to be doing to secure a stronger poll position for his party. "The fact is that Will had it all against him from day one," says one source on the promise of anonymity. "Dylan MacMillan, John Baker, Cosette... they all contributed to a toxic atmosphere that detracted from the important policies that Will was elected to represent."

In a short statement released to the press, William Croft said that "it has become clear that I am not the right person to lead our Conservative movement forward. As a result I am officially announcing my intention to step down as leader of the Conservative Party, and to allow for a new leader to continue the work that must be done.

" that we act boldly, never shy away from expressing our views frankly, and remain deeply passionate about guaranteeing Britan's best days lie ahead," said Croft. "I look forward to supporting our party [. . .] and wish our next leader all the best in the world."

His Shadow Chancellor, who it is believed emerged from a meeting with the Leader of the Opposition shortly before his decision to resign was announced, Sir Nicky Mountstuart, said of the outgoing leader "He [William Croft] has taken this decision entirely of his own volition, and I think that speaks to the character of the man: Will Croft's political career has been about service to his party and to his country [. . .] I do not believe it is appropriate to offer any further comment, other than I wish William well."

Welsh Conservative MP Owain Jones, whose marginal seat is at significant risk if things don't change for the Conservatives according to some pollsters, said "we need to continue focusing on holding the government to account and bringing our message of a Conservative Party of prosperous and strong Britain."

Finally, Shadow Environment and Energy Secretary, Iris Appelle said that she thinks "William served the party honourably" and that she "will offer [her] support for his future choices."

Monday Club MPs were asked for comment but refused.

It is expected that the Conservative Party will soon announce its plan to replace Croft quickly so as to be able to refocus its efforts on making back the losses incurred since the general election.

[Blakesley]

Germany 'already in recession'; France 'on the brink'
December 2001



Germany is already in a recession, and things will get worse later this year, a leading economic think-tank has said. "Germany is in recession, there is no doubt about that," said Hans-Werner Sinn, president of the influential Ifo economic institute.

During the July to September quarter, German gross domestic product (GDP) fell by 0.1%, and Mr Sinn said he expected a further reduction in the last three months of the year. Mr Sinn's remarks come the day after the Bundesverband der Deutschen Industrie (BDI), Germany's leading industry association, also admitted that a recession was a reality. And they came as industry association BVB said the German construction sector had shed 150,000 jobs this year, with a further 80-90,000 set to disappear in 2002.

Concerns in the eurozone

While the declaration of a formal recession will wait until early 2002 when the final figures of the fourth quarter of 2001 are available, economists hold out little hope that Germany will avoid recession. The economy remained flat in the second quarter of 2001, before declining by 0.1% in the third quarter of 2001.

"The economy is heading downhill and the business climate is clouded over for a sustained period, but the German economy is standing on solid foundations," the BDI said in a statement. The government of Chancellor Gerhardt Schröder is actively preparing a set of economic reforms to restore competitiveness to the Germany economy. A spokesperson for the German Chancellory said, "We are preparing to respond robustly to whatever the data may be."

Much like Germany, French economists anticipate that France will enter recession in the first quarter of 2002. "The growth situation is worse in France than Germany. France is likely already in a recession, but certainly on the brink."

Trouble across the Atlantic

Economists at the National Bureau of Economic Research (NBER) predicted that the United States would remain in recession through at least the first quarter of 2002. "President Bush's tax cuts have helped a bit, but growth just isn't rebounding to where we want it to be," said an economist associated with NBER and the Bush administration.

Canadian economists are also preparing to record Canada's first quarter of negative growth in the fourth quarter. The Canadian and US economies are intertwined and a prolonged recession in the US will have a knock on effect on Canada eventually.

(Parts of this article were adopted from this BBC article)

[Barclay A.A. Stanley]

TORY LEADERSHIP DECIDED BY ACCLAMATION

Sir Nicholas Mountstewart, the sixteenth Baronet Mountstuart, was acclaimed leader of the Conservative and Unionist Party by the party's MPs, foregoing the need for a party membership vote.

DECEMBER 2001

The Conservative and Unionist Party's parliamentary caucus has, controversially, agreed to select their new leader by acclamation. The Chairman of the 1922 Committee announced the results last night to a mixed reception with some party members apparently "upset and annoyed" that the party MPs selected the former Shadow Chancellor of the Exchequer, Sir Nicholas Mountstuart, without so much as a courtesy vote for its more than 100,000 rank-and-file members.

The Shadow Chancellor who, by virtue of his father's recent passing, is now the Baronet Mountstuart, was a strange choice, according to some Conservative Party members, after what most experts considered an "unreserved disaster of a shadow budget process." Mountstuart, known affectionately by friends as Nicky, failed to make a single intervention in Parliament against the government's budget and this has raised the ire of Conservative constituency association chairmen across the country, especially in marginal seats.

The Chairman of the Bradford West CCA, Ahmed Ali, reached out to the BBC to comment. "I can't fathom it," he said. "The arrogance of our Members of Parliament to elect anyone, let alone some Baronet, to the leadership of our party without so much as consulting the membership. And then add on to it that he has done precious little of note up to this point. I'm very concerned that we will lose our MP when the government calls an election." Bradford West is a Tory marginal that, based on current polling, is likely to flip to the government if an election were called today.

Not all Conservative Party members were disappointed by the appointment, however. Sir Tom Bowling, Chairman of the Arundel and South Downs association, said that Mountstuart was a "sound man, raised and educated in a model of public service," and that what he may have lacked in experience, he made up for in "bottom." Bowling said that "with Nicky at the helm, I'm confident as ever that we will begin to recoup our losses under Croft."

As a result of the acclamation, which has been exacerbated by the new leader's unwillingness to be part of the budget debate while he was shadow chancellor, there is a growing clamour for reform within the Conservative Party. Tory supporter, Jacqueline Heatherstone, told the BBC that "it is incredibly emblematic of our party, that a decision was made in a smoke-filled room, to appoint a nobody just because his father was a Baronet. For God's sake, he couldn't even be bothered to do his job as Shadow Chancellor. Why do we think he'll be an effective leader? Well, I guess the answer to that is 'we don't' but the grandees do. This flies in the face of the free, egalitarian, meritocratic party that our party's grassroots has been trying to establish and it really is the last straw. We need democratic reform of this party, and we need it now."

Despite the swelling of grassroots discontent, the Conservative Parliamentary Party was quick to support their new man. Frederick Sackville-Bagg, the controversial and outspoken Tory MP, said that he was "very pleased to hear that Sir Nicholas is now leader of the Conservative Party [. . .] With Sir Nicholas, we will fight for what is right for this nation, and we will win." Mr. Sackville-Bagg's enthusiasm and confidence in the new leader highlights the chasm which stands between the Parliamentary Party and the Membership of the party. If Sir Nicholas is to reassure the waverers and discontents in the Conservative Party's rank-and-file, he will need to quickly outline his vision for the country.