The Waugh Zone Monday November 27, 2017

The five things you need to know about politics today.

After being pleased overall with the way the Budget landed, Theresa May will be hoping to once more regain control of the political narrative with today’s publication of the Government’s long-awaited ‘Industrial Strategy’. Some ministers worried that the rumoured Royal engagement of Prince Harry and Meghan Markle would knock the item off the news agenda and some media have downplayed it. But the FT has splashed Greg Clark’s plans and so far this morning it has led the BBC news (possibly the first time in weeks the No10 media ‘grid’ has actually worked out). The strategy will focus on four big areas of medical tech, artificial intelligence, driverless cars and clean energy.

The good news for the Business Secretary (who is due to make a Commons statement today at 3.30pm) is the warm reception for the announcement that two big life science firms are Merck and Qiagen are creating 1,700 jobs with nearly £1bn in investment in London and Manchester. The message is that big pharma is coming back, after Pfizer’S plans to close two UK sites last year. The bad news comes in the shape of falling investment in our car industry (the BBC says it ‘fell off a cliff’ in the past two years, Clark said it was ‘very lumpy’ and figures ‘go up and down’) amid uncertainty of the wider impact of Brexit.

And on Brexit, Michael Heseltine told Radio 4 last night that the most obvious solution was ‘to stop the Brexit initiative’. Many, not just Tory MPs, will think that’s politically naïve and underlines how some ‘Remoaners’ just won’t accept the referendum result. Yet some ex-Remainers hope Clark has repeated to Big Pharma the (alleged) private nods and winks that he gave to Nissan and others: that Brexit will be fine because in the medium term we would keep the same EU regulation and trade deals, as well as high-skilled immigration. The trick to dealing with business’s chameleon-like approach to investment is self-interest. If the self-interest of firms, like Brussels, can be aligned with the Government’s interest in delivering a ‘smooth’ exit from the EU (while not infuriating Leave voters), a path can be forged through the thicket.

It’s clear that the NHS’s sheer buying power, plus our world class medical research, is a draw for overseas firms. And Hammond’s 33% increase in R&D spending to £12.5bn by 2021 will help tackle the productivity gap that undermined his growth forecasts that generated so much gloom last week. The wider issue is whether today’s strategy will tackle what the Bank of England’s Andy Haldane called ‘the long tail’ of UK firms, often based in our small towns, that have seen no rise in productivity for years. That’s why localism is another key feature of the strategy today. A review of local enterprise partnerships is included in the document, but councils and businesses are expected to lead the way. Meanwhile, a new Northern Powerhouse Parliamentary group launches today. And Theresa May’s U-turn on Manchester terror funding at least halted another row not meant to be on ‘the grid’.

John McDonnell has spent days since the Budget arguing that Philip Hammond’s biggest mistake was in not using record low interest rates for a ‘borrow-to-invest’ strategy. On Peston on Sunday, the Shadow Chancellor again refused to say how much he expected Labour to pay in interest payments under his plans (he also cheekily said Peston’s new book could guide Labour policy). He did however seem to semi-apologise to Today’s Mishal Husain, saying he was “sorry if people thought I was arrogant” when accusing her of “trite journalism” for asking the same question last week.

The Tories have seized on the candour shown by Shadow International Trade Secretary Barry Gardiner, who told Marr yesterday that it would be “foolish” to say Labour would clear the deficit by 2031. McDonnell’s spokesman swiftly insisted however the party would stick to its manifesto pledge to clear the deficit within five years. Labour MP Emma Dent Coad is not to be outdone in the candour stakes, laying bare what she really things of Theresa May by retweeting an image of the PM suggesting she is ‘ugly’ because she has ‘ugly’ thoughts. (She was citing Roald Dahl’s The Twits, but as the Shaun Bailey row showed, quote marks don’t absolve you from controversy).

Under pressure from Labour, Channel 4’s FactCheck has now amended a post criticising McDonnell for his claim on Today that the extra debt interest costs would be ‘minimal’ because of a ‘one-to-one multiplier’ that every pound spent on investment would result in a pound of extra GDP. One version of the piece has been cached HERE, the final amended version is HERE (at one stage readers just saw THIS). FactCheck’s initial tweet said: “It seems the shadow chancellor doesn’t understand some key elements of government finances”. But it has now changed the piece ‘in the interests of clarity’. Labour has done some digging of its own, pointing out Osborne’s planned “Google tax” aimed at multinational corporations will have raised £700m less than forecast by 2020-21. Hammond vowed a review of this whole area, but kept quiet about that little black hole.

This Thursday, NHS chief Simon Stevens and his colleagues are due to hold a meeting working out just where they start rationing treatment after the Budget’s failure to give them enough money. One of the most extraordinary post-Budget stories came in Saturday’s Guardian, which reported that the real reason the NHS got only £2.8bn was because Stevens had gone public with his £4bn demand. Philip Hammond viewed it as ‘very, very unhelpful’ and sources said he couldn’t be seen to give in to ‘overt public blackmail’. “If Stevens hadn’t intervened the NHS would have got more,” one source familiar with the pre-Budget negotiations said.

Now this is quite a claim. Did Hammond really deny the NHS funds in a fit of pique with Stevens? Or is this just convenient ‘stealth scapegoating’ when many suspected Hammond just wasn’t going to ever give more funds than the £2.8bn? Stevens was already irritated he’d been kept out of private talks with the Treasury (Jeremy Hunt led for the NHS instead), so how could he be blamed for going public? Whatever the real reason, NHS England’s board meeting this week could be very difficult politically for the Government.

Two front page stories underline health cost pressures today. The Guardian reports that the General Medical Council believes patient safety is being put at risk because inexperienced trainee doctors are too often left in charge of A&E and other units. The Mail splashes that some ambulance chiefs in England are cutting costs by sending technicians instead of paramedics to 155,000 of the most serious 999 calls.

Watch this New Zealand cop recruitment video that’s gone viral.

It’s taken some time but it’s finally dawned on many people that the issue of the Northern Ireland border is pretty crucial to Brexit. On SkyNews’ Sunday with Paterson, Liam Fox dug in, declaring “We can’t get a final answer to the Irish question until we get an idea of the end state”. Note that he said ‘final’ answer, so maybe there’s an interim answer that will be cobbled together for the EU summit next month.

It remains to be seen just how much Dublin wants to push this right now, given its veto and leverage, or will wait until later. With the DUP resisting an Ulster-only single market, and the Irish government demanding one, London is indeed in a difficult position. Damian Green (whose fate could yet ensure this is not a quiet week for the PM) and chief whip Julian Smith were at the DUP conference this weekend, in a symbolic show of support. What doesn’t lower the temperature is Twitter chat like this from UKIP’s Gerald Batten: “UK threatened by Ireland. A tiny country that relies on UK for its existence…” and “Ireland is like the weakest kid in the playground sucking up to the EU bullies.” The backlash started last night and will continue today.

Those who have only a vague awareness of ‘Black Friday’ will be even less aware that today is ‘Cyber Monday’ (the day in the US when online retailers expect to do most business). But the phrase is given another twist in the Mirror’s splash which reports state-sponsored Russian cyber units are spreading false information about flu and measles jabs in the UK. NHS chiefs have had emergency talks about the spread of the so-called “fake news”.

Meanwhile, the Telegraph reports that National Security Adviser Mark Sedwill wants to boost cyber warfare funding rather than increase conventional armed forces. Defence Secretary Gavin Williamson has his first Defence Questions in the Commons today and he wants an extra £2bn in cash. One of his predecessors, Liam Fox yesterday admitted there were ‘tensions’ within Government over a fresh round of planned cuts that could see marines, the Navy or fighter jets cut. The Times reported on Saturday that defence minister Tobias Ellwood was ready to quit if cuts went ahead.


Had a lie in? Got a life? Don’t worry, here’s all you missed from the Sunday shows in one place.

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