1-0 down

Keep out the Italians but concede to the Faroe Islands.  Bang head off desk moment. UPDATE 1-1 come on we need the three points. UPDATE Draw, standard NI cliche do well against the better teams mess up against the also rans.

Plans B and C

Following the debacle that was the half-way house of UCUNF, there is an ongoing discussion between the Conservative and Ulster Unionist Parties about what its future relationship should be.  Unsurprisingly for a partnership that has been dysfunctional from the beginning, the respective Plan B's for the relationship are heading in entirely different directions.

The Conservatives wish the relationship to move towards full-scale merger.  As Ian Parsley points out, this was always the direction the Conservatives wanted the relationship to move towards.  It would also tackle the problems over selection etc that the Tories believe contributed to the poor performance.  However, there are two obvious issues with that. Who would opt to be the Ulster equivalent of Annabel Goldie and Scottish Tories?  The swiftness with which party resources were cut here after the election does cast further doubt on what level of commitment the Tories genuinely have.

Meanwhile, the Ulster Unionist preference appears to be long-fingering merger and instead of the half-way house they'd prefer a single foot in the Tory camp with a return to the old relationship of taking the Tory whip (presuming they can manage to get someone elected).  Yet this option retains many of the risks of a link with even less of the benefits. 

Three Thousand Versts points to the Conservatives working quietly on a Plan C.  However, creating a party from near scratch that can find credible candidates and run good campaigns is no easy task.  The Tory operation has had difficulty grasping that the political culture of Northern Ireland has distinctive elements.  This means a carbon copy of approaches used elesewhere do not provide the same results.  Nationally, Tory membership has been falling for years and to try to recruit and expand here while going through the largest budget retrenchment in generations is an immense task.  For example, how well will pensioners (and their families) react if the NIO leaks that PMS savers will receive only a % of their money proves to be true.   Also in this Owen Patterson may be more of a hindrance than a help, he has a whiff of colonial attitudes about him that the average Unionist voter can spot and doesn't like.

Considering all this, the problems at the UUP Executive may have been a welcome distraction for Tom Elliott.  However, it also gives him his first challenge to act on his demand for discipline and it isn't as if one of the participants doesn't have form.

Inflation

The introduction of water charges has become the answer easiest to some people's lips in terms of the Northern Ireland's budget issues.  However, it is not surprising that 64% of the population opposes their rapid introduction.  Beyond the fear for the future driving this view there is hard economic reality that inflation is hammering household budgets.  For the 10th month in a row inflation is above the government target of 2% with it stuck at 3.1%.  With many having salaries cuts or frozen then this is a significant decline in disposable income.

Quote of the day

"...she pulls out two sets of lingerie from a bag: a bright red cape, bra and matching knickers along with some devil's horns and a tail on the one hand, and a bride's veil, a garter, and a fluffy white bra and tanga on the other. "I was given these by a woman who owns a lingerie shop in Copiapo," she tells me. "I wasn't sure at first whether to wear them or not, but then I mentioned it to Claudio, and he seemed really keen on the idea, so I will."

I'm shocked and stunned that a man trapped down a Chilean mine for months would be so keen on such a suggestion.

Who'll get the 2.25 million jobs?

Fraser Nelson continues his focus on the ability of the British Labour Market to a) create jobs but b) for that demand to be met by foreign workers.  This dysfunction he predicts is a long-term danger for Cameron and the Coalition.  Its economic vision is based upon a significant expansion of the private sector providing more than two million jobs.  However, who gets the jobs will impact upon the feel good factor voters will feel?  

Nelson expects Labour's Ed Balls to focus on the issue to maxmise Coalition discomfort and pins his hopes on the impact of welfare reform to deal with it.  However, the desire for foreign labour isn't solely driven in the private sector by how much the welfare system instills or inhibits a desire to work.  There are also issues of work readiness and work ethic.  Even if the welfare reforms lead to more seeking to become active participants it doesn't necessarily follow they can compete within it.  This is were we need to look at what are called Intermediate Labour Markets to ensure people can.

Tell me why I don't like Mondays

This came to mind on reading the latest depressing data from the Ulster Bank PMI survey about the state of the local economy.  Private business sector business activity is down for the 10th month in a row with construction, retail and services all suffering while even more worryingly private sector employment is down for the 31st month in a row.  The conclusion is that:

"...the local economy is in a much weaker state than any other UK region"

This places a highly significant question mark over the ability of the private sector to absorb any reduction in the public sector.  Beyond the general economic difficulties and reliance on the public sector, the Northern Ireland economy has two further problems that differentiate it from other parts of the UK.  First, the differential impact of the significant decline of the Irish economy.  Second, the issue of the private sector's access to credit.  The greater presence of Irish banks in our financial sector, who are taking an even bigger pasting than the UK banks, is interfering in our credit flow.  While some attention is being given to the Treasury paper on growing the private sector, it is probably worth the effort to ensure the Banking reform paper also addresses this particular circumstance of Northern Ireland. 

Lifting from Obama?

The core reasons why I didn't like Cameron's Conference speech was he was trying to be someone else (namely Blair) and he used a number of devices what seemed to me to be from the culture of American speech-writing.  An inauthentic voice comes through in a speech.  The Mail of Sunday has confirmed the latter, arguing the Tory activist bit was lifted from a 2008 Obama speech.  Although the device is commonly used for example it is a regular feature of the State of the Union address.

Cuts Plan B

Whilst chatting to a friend last night he reminded me of Michael Portillo's comment that the cuts would prove much harder in reality to deliver than the Tories seemed to imagine after the election.  The Financial Times (registration required) this morning made a similar point:

"Confronted with the difficulties of quickly cutting spending – including financial penalties for breaking contracts and redundancy costs – ministers have been forced to consider delaying some of the big savings until later in this parliament."

This means Treasury officials are developing a Plan B for the cuts programme:

"The Treasury is working on plans to “reprofile” spending cuts next April, spreading the pain of deficit reduction more evenly over the next few years, senior Whitehall officials have told the Financial Times."

The same amount gets cut but less now more later. The danger of such a step is twofold. First is market reaction.  Will it be interpreted as a loss of political will thus leading to a more neagtive market perspective on the future of the British economy?  A Goldman Sachs analyst argues how it is explained to the markets will be key:

"If people were clear about the reasons for any delay [to spending cuts] rather than suspecting a political wobble ... I don’t think [investors] would change their mind about the risk premium on gilts,"

Although the wobbling over child benefit earlier this week will increase suspicions.  Second, in the short-term, the Labour Party could try to do a partial victory lap.  They could argue it is a de facto adoption of what they planned to do in the next couple of years at least. However, if they do do this it limits their ability to object to try and ride any anti-cuts sentiment.

It may also mean that the appeal for a change in approach from the devolved institutions may not fall entirely on deaf ears.

Cameron's Conference speech

In the immortal words of Bart Simpson

"I didn't think it was physically possible, but this both sucks and blows. "

He needed to pull out an impressive one and he failed to do it.

Oh dear - Updated

It's well seen Alex Kane has left the UUP press office, I doubt if this would have seen the light of day in his time even on a bad news day like today.  Denial mixed with a blame game over a unhelpful narrative rarely works.

UPDATE Meanwhile up on the hill the UUP garden is rosy with an MLA briefing of their unhappiness over a vice chairmanship.

Wobble Wobble

The backlash over the child benefits announcement has the Conservatives wobbling all over the place and sidetracking their conference.  Cameron was sent out to defend but he unwisely added some dissipation of saying other reforms would help those affected.  The single/dual income issue makes it a sticky wicket especially on the issue of fairness but anything further muddies the water.  This has been followed up with a leak to the BBC that the marriage allowance measures will be introduced in 2015. 

Presentationally this is a mess.  This now means the government position can be boiled down to we'll take something off you in 2013 and give it back to you in 2015 by a different route. It seems to be another example of how the core problems with strategic communication that dogged their election camapign have continued in government.  To wobble so quickly over measures that are 3 years away also does not smack of firm government.

Jens Henriksson's essay on the Swedish cuts programme stresses:

"Never say that it won't hurt. Never say that it is peanuts...This will help ordinary people to plan ahead and to limit shocks."

Wobbling on cuts comes close to an implicit breach of that.  He also highlights the pointlessness of dissipating measures.  They introduced a small tax cut.  The result was:

"...when the government came out with a bonus, they just became puzzled."

Quote of the day

Why Ed reminds women of every bad ex-boyfriend.

Scrabbling around for rationality

Eamonn Mallie seems to think that blowing up a bank and hotel has something to do with marking the anniversary of a civil rights march in 1968.  Just as likely to be marking the anniversary of an event a year later - the first showing of Monty Python's Flying Circus.  Or perhaps the anniversary of Dr No being released in 1962.

Free Beer

The US electoral cycle continues to provide us all with entertainment from Dale Paterson's all out assault while Basil Marceaux provided a media masterclass.  Now we have the candidate with a name in the tradition of the bands that have called themselves 'Free Beer'.  The Republican candidate for Alabama State Treasurer is called Young Boozer and unlike the others is odds on to win.

To help you through your day...

...a picture that warms the heart.

Mixed bag

George Osborne gave a speech on welfare reform yesterday with one good idea and one bad idea wrapped in a mistake.  The idea of capping the welfare levels is an interesting one that has a basis in the principle of fairness.  However, you do wonder if it is a means of exporting the unemployed from nice Tory areas of London etc.  The cut to child benefit is the bad idea.  It undermines the principle of universality which the Tories themselves made the case for during the election. 

The mistake was presentational.  Should it have been the Chancellor making such a speech?  Does it not make the context all about money rather than reform to our welfare system?  Would it not have been wiser coming from Iain Duncan Smith?  He has spent years building up his personal and party's credibility on the issue, would it not have been time for him to spend some of that capital rather than a Chancellor with none.

Scary Biscuits

At the time of the election it was claimed too much was made of David Cameron's Newsnight interview (7 minutes 35 seconds in) comments about cuts in Northern Ireland and the North-East of England.  However, the news that the Tory Chancellor George Osborne intends to tear up the capital investment programme agreed as part of the St Andrews Agreement is sufficiently grim that it now makes the attacks look positively tame. 

The cuts programme has been a consistent theme of this blog, almost to the point of obsession.  However, this sort of cut takes it from the realm of painful to debilitating. First and foremost cutting capital is the easy option but it is not strategic - a pound on capital provides a greater long-term return than a pound on revenue spending.  Plus a deferred capital cost has a nasty habit of becoming even more expense the longer it is delayed.  Second, there is a legacy of under-investment in our infrastructure.  Capital budgets were the usual victim when extra security resources were needed.  Third, the construction sector is being kept alive by what public capital projects are out there and proposed.

The original proposals for capital cuts could have been just about managed.  If an asset sales programme were agreed then a significant part of the hole could have been filled (provided the mandatory coalition government would have signed up to such a programme.)  Deeper capital cuts simply can't be.

Owen Patterson didn't do a very good job of trying to blame Labour and trying to slide away from those parts of the St Andrews Agreement. This also sets a precedent that he will have difficulty living with as Secretary of State.  These are also the party that Ulster Unionists were queuing up to be photographed with, told Northern Ireland voters to trust and back their joint manifesto and tried to run interference over Cameron's comments.

Ministerial Choices

In an exclusive interview for Farm Week, Tom Elliott has held out the prospect of the UUP taking the Agriculture Ministry after the Assembly election. 

"The suckler and beef farmer from County Fermanagh even held out the prospect of an Ulster Unionist Agriculture Minister..."

The nature of the ministerial appointment system means only one choice can be guaranteed - the very first one and that falls to the largest party.  After that choices are shaped by the decisions of others.  Basil had prioritised education as the UUP's preferred first choice of ministry (assuming it was still available) is Tom going to make Agriculture the UUP's first choice (assuming it is still available)?

Critcal and Slugger

My Critical Reation essay has been picked up by slugger.  The debate is here.

Eleven

Hat Tip W.