Guido recalls when Labour dangled the prospect of “the dream of owning their own home” to capture the hearts and votes of young people. Yet, like most of their pledges, that promise has swiftly been dashed. After Reeves’ high tax-and-spend budget, house prices are set to soar nearly twice as fast as inflation over the next five years, leaving wages in the dust. JLL‘s latest forecast predicts a staggering 20% jump in house prices by 2029. The lofty days when Labour claimed they’d deliver the “biggest boost to affordable housing in a generation” are already over…
Meanwhile, homebuyers are bracing for a staggering 148% hike in their stamp duty bills, courtesy of Reeves’ stealthy property tax grab. The average stamp duty bill in England is projected to rocket from £2,979 this year to £7,391 by the end of this parliament. Labour pulling up the housing ladder behind them…
Reeves trashed the gilt market last week by pushing up UK 10-year gilt yields to peaks much higher than the 3.47% seen the day after Kwasi’s budget in 2022. The fallout hasn’t stopped there…
At this morning’s auction UK bonds saw the weakest demand since December last year. 10-year yields are still high at 4.496%. Investors’ concerns haven’t been assuaged by Reeves’ special post-budget media round – the bashed market limps on…
Ed Miliband is busy this morning boasting about a new report from state-owned National Energy System Operator on the government’s Clean-Power-by-2030 target. He says “Expert analysis backs our policy and its benefits for the country. Defeatist critics should take note”…
What proposals is he actually talking about? The report is very careful in its wording and makes clear that Clean Power targets will only be reached with:
- A four-to-fivefold increase in ‘demand flexibility’ from 2.5 gigawatts today to at least 10.4 gigawatts. That means millions of households co-operating when the government tells them to use less electricity at short notice…
- Sustained rollout of offshore wind at over double the highest rate ever achieved in Great Britain. Which means tripling capacity…
- A tripling of solar power is required, as well as a doubling of onshore wind capacity.
- A four-fold increase in battery capacity.
- A lifetime extension for at least one old nuclear power plant. Which no-one believes will happen by 2030…
Wind power is known to falter in Britain – at which point blackout prevention systems come into place. This occured as recently as last month. Relying on wind generation for half of all power in the UK and demand will have to be forced very low indeed…
Neso is clear that “a dramatic acceleration in progress compared to anything achieved historically” is required and “failure in any single area – generation, flexibility, networks – will lead to failure overall; all parts need to deliver to achieve clean power.” Success in any single area is unlikely enough…
If enough households don’t voluntarily agree to keep the kettle off to save electricity in high-demand periods they will have to be compelled. Good that Net Zero won’t help to generate GDP growth either…
Kemi Badenoch has officially unveiled her Shadow Cabinet ahead of its inaugural meeting today, and it’s a staggering show of loyalty—20 out of 25 appointments were her supporters during the race. Only two, Victoria Atkins and Ed Argar, threw their lot in with Robert Jenrick, while three former leadership rivals—Jenrick, Mel Stride, and Priti Patel—managed to snag a spot. Tom Tugendhat, on the other hand, was left out in the cold, though his allies claim he chose the backbenches of his own accord…
It was slim pickings for Kemi, having to choose 21% of the Tory MPs to fill her Shadow Cabinet – all with an eye on avoiding the Tory big beasts who helped secure the party’s disastrous electoral defeat. Still, only five members have been MPs since 2010, while four were elected in the 2019 wave. Meanwhile, the Shadow Cabinet is only just on the pro-Brexit side, with 14 ministers firmly in the pro-Leave camp and 11 who backed Remain in 2016. Guido gives you a breakdown of when the MPs were first elected, alongside their 2016 EU stance:
- Laura Trott, Shadow Education Secretary: 2019, now Brexit. Though she was a SpAd to Cameron in 2016…
- Andrew Griffith, Shadow Business Secretary: 2019, Brexit.
- Claire Coutinho, Shadow Energy Secretary: 2019, Brexit.
- Gareth Bacon, Shadow Transport Secretary: 2019, Brexit.
- Alex Burghart, Shadow Chancellor of the Duchy of Lancaster: 2017, Brexit.
- Andrew Bowie, Shadow Secretary of State for Scotland: 2017, Remain.
- Julia Lopez, Parliamentary Private Secretary: 2017, Brexit.
- Chris Philp, Shadow Home Secretary: 2015, Remain.
- James Cartlidge, Shadow Defence Secretary: 2015, Remain.
- Ed Argar, Shadow Health Secretary: 2015, Remain. A Jenrick backer…
- Kevin Hollinrake, Shadow Housing Secretary: 2015, Remain.
- Victoria Atkins, Shadow Environment Secretary: 2015, Remain. Another Jenrick backer…
- Alan Mak, Shadow Science Secretary: 2015, Remain.
- Nigel Huddleston, Co-Party Chairman: 2015, Remain.
- Mims Davies, Shadow Wales Secretary: 2015, Brexit.
- Richard Fuller, Shadow Chief Secretary to the Treasury: 2015, Brexit.
- Helen Whately, Shadow Work and Pensions Secretary: 2015, Remain.
- Robert Jenrick: Shadow Justice Secretary: 2014, Remain.
- Mel Stride, Shadow Chancellor: 2010, Remain.
- Priti Patel: Shadow Foreign Secretary: 2010, Brexit.
- Stuart Andrew, Shadow Culture Secretary: 2010, Brexit.
- Rebecca Harris, Opposition Chief Whip: 2010, Brexit.
- Jesse Norman, Shadow Leader of the House of Commons: 2010, now Brexit. Though he won’t say how he voted in 2016…
- Dominic Johnson, Co-Party Chairman: Brexit.
- Lord True, Shadow Leader of the House of Lords: Brexit.
Enough to unite the party?
OBR personnel are currently before the Commons Treasury Select Committee to answer questions about their budget forecast. Labour MP Jeevun Sandher, who was busy parroting Labour budget lines on the airwaves last week, was confused that Reeves’ injection of £22.6 billion extra to the NHS won’t boost potential output. He claimed that output was revised down under the Tories thanks to ‘declining public health’ and complained that the OBR doesn’t think extra cash will now help…
OBR Chairman Richard Hughes slapped Sandher down:
“Myself and my predecessors have revised down our views of potential output pretty steadily since the aftermath of the financial crisis. Every country in the world has suffered a big hit to potential output, including those like the US who’ve continue to spend lots and lots of money on healthcare. The idea that there’s a direct link between how much are spending on healthcare and the potential output of the country is not demonstrated by the data.”
That is – chucking more money for day-to-day NHS spending won’t help growth. Hughes also pointed out no further plan has been spelt out by the Treasury: “We know very little about what the government’s plans are for healthcare spending after.“ So much for “Reform or die“…
At the same time MPs were shocked that it would only take a 0.3% increase in interest rates to entirely wipe out Reeves’ “fiscal headroom.” It’s not just the gilt market coming to terms with the scale of Reeves’ spending…
“A 1.3% increase in the interest rate… that actually results in the current balance in five years being in deficit by £11 billion, so you’re actually missing the rule by £11 billion… To get the current balance down to essentially zero so to take away all the current headroom, we have point three.“
The budget has already prevented faster interest rate cuts according to economists and boosted future inflation. Reeves’ pretend “fiscal stability” is a house of cards…
The Tory Party membership has taken a nosedive, plummeting by almost a quarter in just two years, with numbers now down to a paltry 131,680. Meanwhile, Nigel Farage’s Reform Party is riding high, surging to over 95,000 members. Farage was quick to thank new Tory leader Kemi for the recent membership boost, saying:
“There’s going to be no change whatsoever [with Kemi]. We’ve gone up 1,500 in the last three or four days. And these are Conservatives who are hanging on to see whether the party could change direction. For us as a party, it’s very good news.”
Reform are now dangling a tempting prize for their 100,000th member: a pint with Reform MP Lee Anderson. At this rate, it’s only a matter of time before Reform leave the Tories in the dust…
Speaking on Times Radio, former Home Secretary David Blunkett spoke about overdiagnosis of mental problems:
“Let’s distinguish those who are really severely mentally ill, diagnosed with things that require prolonged medical and diagnostic treatment. My wife and I talk about this a lot, because she’s a retired GP, about the fact that you can be sad without being ill. You can be momentarily depressed because your boyfriend or girlfriend’s just thrown you and you’re not mentally ill. You can even have mild issues, which can be dealt with with the right kind of support, but it doesn’t make you mentally ill. So we’ve got a real task, I think, to get the psychology, if you like, of this over. But there are things where you definitely need medical intervention, and there are other things where you need good friends, you need good connectivity, and you need a job.”
