1. CARILLIONS OF CASH
It’s the end of the line for HS2 contractors Carillion. The construction firm involved in the massive rail project, as well as lots of other public contracts, announced just after 7am it was going into liquidation. Talks between the debt-laden company, its lenders and the government failed to reach a deal. It’s the second largest construction firm in the UK, but in the end it was not ‘too big to fail’ and no bailout was given. The pro-EU group Best for Britain even blames the B-word, claiming part of the problem was “a Brexit-related slowdown in orders”, though that is far from clear.
Unions have expressed worries over the jobs and pensions at risk, particularly for the agency workers involved. It appears that some of the contracts will be passed to other firms, but some may be ‘renationalised’. What’s strange is how one big firm can have been allowed to dominate so many contracts, from schools to hospitals to prisons (the Guardian’s Amelia Gentleman reported when she went to Wandsworth jail she spotted lots of broken cell windows and was told the job had been outsourced to Carillion). Former Cabinet Office minister Francis Maude had spent years calling for smaller contractors to be given more work, but Labour says the problem is a fundamental one with public-private contracts.
A Commons statement or Urgent Question (Stella Creasy has blogged for us) had been expected even before the liquidation announcement and one at 3.30pm now looks certain. The Times pointed the finger at Transport Secretary Chris Grayling for handing the firm a £1.4bn contract just days after its profit warning last July. The paper says he has failed to get a grip of contract failures by Stagecoach and Virgin and now Carillion. “Theresa May needs to consider whether it is time this transport secretary left the station.” Cabinet Office minister David Lidington revealed on Today that departments had been “drawing up contingency plans” since the profits warning, adding there were legal constraints to pulling out of some contracts.
Ministers are ultimately responsible of course, but the lack of civil service expertise in dealing with private contractors has been raised repeatedly by some critics. Flawed defence projects, IT contracts, NHS and schools PFIs, all suggest the public sector has lacked the business and legal expertise to avoid getting trapped into deals on poor terms. Maybe that’s something Cabinet Secretary Sir Jeremy Heywood will want to address today when he makes a rare public appearance, before the Public Administration Select Committee at 3pm.
2. BREXIT BUS BOY
‘Please hold on, the bus is about to move’. Londoners have been irritated by a new automated announcement this weekend that tells them they’re on their way, even after they’ve left a bus stop. For many Eurosceptics, it may sound like the perfect metaphor for a capital city in denial that the Brexit bus is about to move. But there was flurry of excitement among Remainers when former London Mayor (and £350m-a-week-for-the-NHS bus driver) Boris Johnson hinted the UK could actually stay in the EU.
Yes, the Sun reports that the Foreign Secretary has told confidantes that he shares Nigel Farage’s worries that Brexit may not happen. He told friends that continuing to be a ‘rule-taker’ from Brussels would leave the UK as “just another Norway” and turn the EU referendum result into “a total waste of time”. “I’d rather us stay in than leave like that,” Boris even said. I’d rather us stay in. You read that right. Is this Boris preparing us all for a Cabinet walk-out if Theresa May opts for a bespoke deal that’s closer to Norway than Canada? Why didn’t he say he’d rather us quit without a deal than leave on the Norway model? Or was Boris just indulging in verbal pyrotechnics?
Labour too has its internal semantic rows over Brexit. “The single market is dependent on membership of the European Union,” Jeremy Corbyn told Robert Peston yesterday. That was flatly contradicted by Labour Remainers like Chris Leslie (who along with Anna Soubry and other pro-EU MPs is meeting Michel Barnier in Brussels today). The Labour hokey-cokey over being ‘in’ or ‘out’ or ‘participating in’ or ‘having access to’ the single market is not a fun dance at the best of times. Owen Smith tells the Guardian he finds it all “slightly puzzling, because it is clearly possible for us to be outside the EU and inside the single market, as is Norway and other countries.” Is that the Shadow Cabinet’s official position now?
Meanwhile we report that one arch Tory Brexiteer is already being written off for the party leadership. Backbench 1922 Committee chairman Sir Graham Brady told students that while he liked Jacob Rees-Mogg, it was unlikely he could ‘connect’ with the country. “I don’t see it happening,” he said. And he made clear Gavin Williamson should not have been moved to Defence Secretary: “Gavin’s a capable person. I wasn’t asked for advice. Had I been asked for advice, my advice would have been, ‘he’s doing a good job as Chief Whip, keep him there’.”
3. NEC SEA CHANGE
At noon today, Labour announces the results of its three extra local party reps for the ruling NEC. A clean sweep for the Left is expected, with Momentum founder Jon Lansman achieving a long-held ambition to get to the top table. In online one-member, one-vote elections like this, Momentum have proved they can out-mobilise their Labour First (and Progress) rivals and even the star-appeal of Eddie Izzard isn’t enough to defeat a well-run slate of candidates.
The election (which costs money, some insiders grumble, not least as all posts are up for grabs again later this year) means the NEC will shift decisively even more to a pro-Corbyn majority. With the Young Labour seat already set to change, plans for BAME Labour to go to OMOV (see our story on Friday for how Keith Vaz’s slot is under threat) and Richard Leonard replacing Kezia Dugdale, that’s how it looks. But trade unions still have a big say and any radical internal changes could now lie in their hands.
Unions like the GMB and Unison could be decisive as the debate over mandatory reselection of MPs reignites. Lansman told BBC Five Live yesterday: “There’s no reason for any hard-working MP who campaigns hard with their constituents and the members of their local party to feel nervous about anything.” Which may not quite reassure his PLP critics.
Lansman also said he wanted the threshold for the next leadership contest nominations lowered, if not scrapped altogether. “I want a fair contest in which not just people who supported Jeremy this time, but people who supported Liz Kendall all the other candidates will feel that they’ve got a candidate. Liz Kendall only got four and a half per cent but I still think people who voted for her deserve to have a candidate flying the flag for what they believe in, in the next leadership election..” Kendall supporters yesterday pointed to another statistic. The latest Opinium Research poll putting both the Tories and Labour on 40%. Given how dysfunctional the Government often appears, just why Corbyn is not miles ahead is a question he and his party still have to answer.
BECAUSE YOU’VE READ THIS FAR...
Watch this giant bird photobomb the weather news in San Francisco.
4. BOLTON WANDERER
UKIP’s slide from historic changemakers (that EU referendum would never have happened without them) to irrelevant pantomime repertory company continues. Leader Henry Bolton went on the breakfast shows to announce he was no longer in a relationship with a former glamour model who had made racist remarks about Meghan Markle. “The romantic element of the relationship is over,” he told BBC Breakfast, as if we cared for the details. It’s not obvious why he should be held responsible for his girlfriend’s appalling views, but it looks like he’s caved to demands from MEPs that she goes or he does.
Speaking of racists, Donald Trump says he’s “the least racist person you have ever interviewed”, which is not exactly a denial that he said African states were ‘shitholes’. Our US colleagues have a reminder of all the racially charged things he’s ever said. Some will just thank the Lord that he was playing golf when the real fake news about Hawaii coming under missile attack emerged.
5. STUDENT LOANS
The Guardian splashes its new tabloid with a story that Keele University medical students are being asked to volunteer to help out hard-pressed hospital A&E units and GP surgeries. NHS England stresses the plea comes from the university not from them, pointing out “there have been no instructions for medical students to act in any clinical professional roles and they do not work as doctors”. There’s a more worrying nugget in the Guardian story: specialist nurses are being diverted from looking after patients with dementia to help on general wards
Still, the Guardian has a crumb of comfort for Jeremy Hunt. Polly Toynbee today says ’two cheers to [Jeremy] Hunt for remaining [in post]. She’s not a fan but accepts he’s put long-term funding of the NHS on the agenda. As it happens, on Radio 4’s World this Weekend Andrew Lansley yesterday agreed with Hunt that cash was the real solution to the service’s woes.