The Institute of Economic Affairs has just launched the Richard Koch Breakthrough Prize.

First prize of £50,000 will be awarded to the best and most innovative entry outlining a ‘Free-Market Breakthrough’ policy to tackle poverty in the UK.

There will be runner up prizes of £7,500 each, and a student prize of £2,500. Judging panel includes former Liberal Democrat MP Jeremy Browne (chair) and the Rt Hon Iain Duncan Smith.

The deadline for entries is Monday, 9 January 2017.

To learn more about the Richard Koch Breakthrough Prize and the entry requirements, click here – and watch the video below!

OECD OMG GDP! Brexit Recession Forecast Reversed


“Not a single serious economist does not think Brexit will be bad for the economy” was the message from George Osborne when he cited the OECD, IMF and the OBR to back up his arguments that Britain would require an emergency budget and that there would be a worldwide economic shock if Britain voted to Brexit. Yesterday the OECD said it got it got the recession forecast wrong and the ONS confirmed none of the latest data suggests the recession that was predicted by 71% of City economists after the referendum vote. That is worse than astrology hence the Sun’s cracked crystal ball. It is actually worse than just flipping a coin.

All this proves once again that economists are as prone to fashion as any other artists. Economic forecasting is not a mathematical hard science, despite the complicated formulas of which they are so fond. It is a question of judgement. Another area which similarly has too many variables to forecast with confidence yet has almost unanimity among those who claim expertise in the subject is “climate science”. The expert practioners in this area also predict doom and disaster. Do you think they could be related?

Centrist Think-Tank Concludes There’s No Progressive Majority


This morning the centrist, cross-party Social Market Foundation held a well attended seminar headlined by Chuka Umunna, Nicky Morgan and Nick Clegg. It felt like a wake for the Labour Party. SMF claims – on the back of research from Opinium – that there’s no progressive left-leaning majority in the country – the majority of voters hold “traditionally right-wing views” that will guarantee a “healthy majority” in the future for the right-wing parties.

The wonks categorised voters’ attitudes into eight political tribes/parties that share very distinctive political views. Despite the majority of voters self-describing as “centrist“, most voters actually identified with centre-right and right-wing political attitudes.

From the report:

On the whole, our analysis makes more cheerful reading for those on the right, than on the centre or the left. The two largest tribes, making up around 50% of the population, hold a range of traditionally right wing views, ofering a solid foundation on which to aim for the 40-42% of the vote which normally guarantees a healthy majority under our electoral system. These groups share a desire to see immigration reduced to below 100k a year and were both solidly pro-Leave in the EU referendum.

The progressive tribes are fragmented, disagreeing on openness to the world and attitudes towards the welfare state and taxation. This is bad news for the current Labour Party as the think-tank finds massive differences between so-called “Democratic Socialists” and “Community” party voter blocs – traditionally known as Labour supporters – while both tribes agree on socialist policies towards capitalism, they diverge on supporting the EU or having an internationalist approach.

SMF also implies that the centre-ground is now being occupied by traditional right-wing politics. So did Cameron succeed in occupying the centre-ground or did the Conservative Party’s modernisers end up pulling the centre-ground rightwards?

City Boys Staying in London


Mark Carney is up in front of the Treasury Select Committee this afternoon where he is going to have to explain why he cut rates and re-started QE prematurely to Jacob Rees Mogg, who thinks “He acted too early in my view. There was not sufficient evidence at that point that further monetary stimulus was needed and there are adverse consequences of abnormally low interest rates as well as beneficial consequences.” As the Citigroup surprise index (above) shows, most City expert economists got it wrong on a Brexit recession. In the last week alone Morgan Stanley, JP Morgan and Credit Suisse have reverse-ferreted on their Brexit recession predictions. None have accepted Guido’s £1,000 wager offer…


On a similar theme it is worth reading the Centre for Policy Studies analysis out today on the pros and cons of Brexit for the financial services. Just as the consensus on a Brexit recession was misplaced (even Remain campaign financing investment bank JP Morgan has now conceded they were wrong) so too will the “City will lose out to Paris / Frankfurt / Dublin” consensus soon dissolve.  The above chart from Prequin shows that not many Masters of the Universe are keen to enjoy the Frankfurt nightlife…

What the City does want is “passporting”, assurance that the Square Mile’s firms will still be able to trade across the EU. The majority of the City’s exports in financial services (60%) go to countries outside the EU – not surprising when not one of the top 10 financial centres is in the EU. China and India are already choosing to do their capital market transactions in London, these are the growth markets of the future. In reality it is likely that if “passporting” obstacles were to be deliberately constructed, they could if necessary be circumvented by booking trades through EU based subsidaries. Zurich is the biggest financial centre on mainland Europe, it has bilateral deals with the EU, the City will want the same…  

IEA: Osborne’s Living Wage Hits Poor, Young, Minorities, Consumers, Taxpayers


George Osborne’s Living Wage is likely to see those it is supposed to help lose out, according to a new report from the Institute of Economic Affairs. The IEA finds that modest minimum wage increases may not cause higher unemployment, but large increases will. Who are the losers? The young, unskilled, minorities and those in the regions:

“Minimum wage increases are always potentially a trade-off, between raising pay for those fortunate enough to keep their jobs and hours against the potential reduction in labour demand. Any significant reduction in demand will hit young and unskilled workers, particularly those from minority groups, hardest. It is also likely to have a bigger impact in some parts of the country than others… the ‘bite’ of the National Minimum Wage has been considerably deeper in Northern Ireland and the East Midlands than in London.”

Higher unemployment is a long-term consequence:

“the longer-run impact of the minimum wage might be to generate larger reductions in employment”

And low-paid earners don’t actually benefit as they lose out in other ways:

“firms such as B&Q and Waitrose have been accused of lowering premium pay for weekends and other ‘unsocial hours’, while Caffe Nero staff seem to have lost the perk of free paninis – showing that minimum wage increases are no ‘free lunch’. Those gaining from pay increases therefore lose out in other ways than jobs or hours lost”

The report concludes that someone ultimately has to pay for any sharp minimum wage increase:

“the cost can only be borne by consumers paying more, shareholders getting reduced dividends, or taxpayers paying more”

The Living Wage might make political sense – it leaves Labour with nowhere to go – but the evidence is it hinders those it is supposed to help…

Vote Leave Chief Launching New Brexit Site, Taxpayers’ Alliance Reshuffles

Vote Leave chief Matthew Elliott is back at Business for Britain post-referendum, and Guido hears he will be setting up a new website called BrexitCentral. Former Lobby journalist Jonathan Isaby is leaving the Taxpayers’ Alliance to join as editor. It sounds like the site will offer plenty of comment and analysis – there is a gap in the market for some proper wonkish insight making sure Brexit means Brexit. It launches in September and Guido wishes them well, readers of this site will no doubt await with interest…

Isaby’s departure from the TPA means a reshuffle in wonk world. Tufton Street veteran John O’Connell, who has been at the TPA since 2009, will be the new CEO, another well-deserved appointment. They’ve also hired Tom Banks, who ran Vote Leave’s ground operation in Yorkshire, as their new grassroots campaign manager. More jobs created by voting to Leave…

May Hires Top IoD Wonk


Theresa May has hired Institute of Directors wonk Jimmy McLoughlin to lead Downing Street’s business relations. McLoughlin, who worked on May’s leadership campaign, will replace Cameron’s arch-Remain SpAd Dan Korski. It’s a smart hire – May’s ‘reforming capitalism’ shtick means she’ll need help bolstering relations and McLoughlin is one of the most likeable people in SW1. Here’s the SpAd list as it stands:

Send any further updates to

Long-Term Rise of Anti-Politics

This morning in Portcullis House researchers from the University of Southampton are presenting findings from a project funded by the Economic and Social Research Council on the rise of anti-politics, Tristram Hunt and Isabel Hardman are going to stick their tuppence in during an audience discussion. The conclusion is that those of us who want to see our lives de-politicised, and the politics-free space in our culture and society increased, are winning…


Since 1945 and the expansion of the welfare state, the popular general dissatisfaction with government has risen 50%. Bigger government increases dissatisfaction…

Politicians are seen as more out for themselves than they were in the past. Whereas during the Second World War over a third of MPs were seen as doing the best for their country, now only 1 in ten are seen as doing so, and nearly half are seen as merely out for themselves.


The academics see the rise of anti-politics as a problem. The inherent premise being that more politics will be good for us. Therefore the low popular opinion of politicians makes political action more difficult. Guido thinks this is a good thing, that the low esteem in which politicians are held is reasonable, people have made a more realistic appraisal of the nature of those who seek to rule over us. Politicians complain that they feel beset by the media and hostile voters because 72% of people see them as self-serving. Good. People should not be afraid of politicians, politicians should be afraid of the people…

Owen Jones’ Think Tank Helps Pay Off Deficit

The union funded CLASS think tank Owen Jones helped found has been fined £1,000 by the Electoral Commission. Unite veteran Steve Hart was stung with the bill after the Centre for Labour and Social Studies failed to deliver not one but two donation reports on time.[…]


Brexit Debate Live Streaming

Tonight’s debate at the Institute of Economic Affairs (above) is an example of the civil war on the right – two IEA wonks Ryan Bourne and Diego Zuluaga are on opposite sides of the argument, Douglas Carswell and former Tory MEP John Stevens are bolstering the wonks.[…]


More EU Sockpuppetry From IPPR


The Institute for Public Policy Research (IPPR) has today released a pro-European briefing outlining the minor renegotiations on Britain’s EU membership that it thinks would warrant staying in the EU. Titled “Unlocking the EU Free Movement Debate”, the document suggests small reforms in EU policy in five key areas are more than enough to stave off Brexit.[…]


Glottal Mobility is Social Mobility


Clare Foges, “the woman who put words in David Cameron’s mouth” when she was his speechwriter, reckons if we all spoke like the Prime Minister the problem of declining social mobility would be solved. Like a modern day Professor Henry Higgins she thinks a veneer of gentility will do more for social mobility than tax credits.[…]


Osborne Jokes About Leadership Coup

The Chancellor has been caught joking about bringing down the PM.

Steady on Gideon…[…]


IFS: Osborne Has Deviated From His Long Term Plan


This morning Guido highlighted several of the Chancellor’s Budget porkies, this afternoon the IFS twists the knife. Osborne told the House that “we shouldn’t go faster, we shouldn’t go slower” on the rate of deficit reduction. Yet Paul Johnson from the IFS confirms we are indeed now going slower:

“the long term plan did change again.



Digital Government Boss Regrets Lack of Women

mike bracken

The biggest mistake Government Digital Service has made in recent years is failing to hire more women according to Mike Bracken, the head of GDS. Speaking to an audience at Policy Exchange yesterday, Bracken repeatedly refused to say what GDS should have done differently during his four year tenure other than to have diversified its workforce more.[…]


Gordon’s Tax and Benefits Mess


According to an ONS release today the mythical average household is £31 better off after taxes and benefits are taken into account. Think about all the complexities of tax collection collection and benefit calculation, the bureaucracy and time wasted. It really is time for a lower, flatter, simpler, single income tax…

The statistics also confirm that after 5 years of “we’re all in it together” that Osborne has raised taxes on the richest 20% and reduced the burden on the poorest 20%.  […]


Tip offs: 0709 284 0531

Quote of the Day

Trump supporter Raheem Kassam responds to Suzanne Evans calling him “far right”:

“We’re going to rise above it. When she goes low, we go high, to quote Michelle Obama.”

Guidogram: Sign up

Subscribe to the most succinct 7 days a week daily email read by thousands of Westminster insiders.


Walkers Factory Was Raided For Illegal Immigrants Walkers Factory Was Raided For Illegal Immigrants
UKIP Leadership Latest UKIP Leadership Latest
Is This Our New Parliament? Is This Our New Parliament?
Japan’s Single Market Trade Japan’s Single Market Trade
Prezza For Jezza Prezza For Jezza
Man On Sun’s Front Page Is Not Interpreter Man On Sun’s Front Page Is Not Interpreter
Was it Davis or Davies? Was it Davis or Davies?
Multi-Millionaire’s “Hipster Begging” Multi-Millionaire’s “Hipster Begging”
Six Figures For Baroness Scotland’s Friends Six Figures For Baroness Scotland’s Friends
Sadiq Tree Policy Chop Sadiq Tree Policy Chop
Marmite Round-Up Marmite Round-Up
Watch Theresa May Burn Emily Thornberry Watch Theresa May Burn Emily Thornberry
Cameron: Brexit Means Leaving Single Market Cameron: Brexit Means Leaving Single Market
Runners & Riders Runners & Riders
Shami Stories Round-Up Shami Stories Round-Up
Masked Glitterballs Masked Glitterballs
Momentum Kids Momentum Kids
Slug-on-Thames for Parliament? Slug-on-Thames for Parliament?