“‘Behind-closed-doors, secret stuff’: council leader slams devolution deal-making”

“A COUNCIL leader who has spearheaded devolution for the Tees Valley has condemned the “behind-closed-doors, secret” nature of the deal-making process.

Sue Jeffrey, chair of the new Tees Valley Combined Authority (TVCA), said she “absolutely agreed” with a National Audit Office (NAO) report’s finding that English regional devolution needed to be more transparent.

“We’ve all said that the deal-making process is very ad-hoc and all this behind-closed-doors, secret stuff isn’t very helpful at all,” the Redcar and Cleveland Borough Council leader said.

But she insisted the TVCA would deliver democratic accountability.

Ten English devolution deals have been agreed in the past 18 months, covering 16.1 million people across Greater Manchester, Cornwall, Sheffield City Region, the North-East, Tees Valley, Liverpool City Region, the West Midlands, East Anglia, Greater Lincolnshire and the West of England, and a further 24 proposals are being discussed.

The Tees Valley’s five councils, Darlington, Stockton, Middlesbrough, Redcar and Cleveland and Hartlepool, and the TVCA which brings them all together, have backed a package handing powers over transport, economic development and skills and planning to a new mayor to be elected in May 2017.

Negotiations with Whitehall are continuing, ahead of public consultation later this year.

But there has been criticism of the lack of public involvement to date and in the North-East the process has been riven with problems. Last month, Gateshead Council rejected the offer outright, while the other six members of the North-East Combined Authority (NECA) voted to postpone a final decision.

Last week, six County Durham Labour MPs wrote to every Labour member of Durham County Council urging them to reject or delay the deal until further details were confirmed.

A NECA spokeswoman said discussions with Government were ongoing and good progress had been made. An update is expected when the NECA meets on Friday, May 13.

The NAO said devolution deals offered opportunities to stimulate economic growth and reform public services but were untested and Government could do more to “provide confidence that these deals will achieve the benefits intended”.

A Government spokesman said the report recognised the “huge progress made in our revolutionary devolution agenda”, but added: “We agree there is much more to do and we will continue to talk to areas so everywhere that wants to take part in the process can do so.”

http://www.thenorthernecho.co.uk/news/14455516._Behind_closed_doors__secret_stuff___council_leader_slams_devolution_deal_making/?ref=rss

“Local government is a failed state” and devolution is ” unresearched and unconsulted”

“George Osborne knows it, Theresa May knows it, the Hillsborough families know it. We all know it. Britain’s national government may be a democracy, but its local government is a failed state.

There were plenty of moments in the Hillsborough saga when local accountability could have lanced the boil. Local pressure could have forced the Sheffield police chief to resign after the Taylor report, not to wait until his successor resigned. A district attorney could have prosecuted the police for gross negligence. An elected mayor of Sheffield could have sacked the police chief or, if need be, been voted out of office.

Such customary processes of democracy do not obtain in Britain. Instead, we must wait for a shambolic quarter-century of bumbling and costly inquiries, inquests, lobbying and lawyers. Still they leave a lingering sense of justice unfulfilled. No one has been properly blamed and punished.

Some ministers, we thought, had got the point. In 2012 Theresa May introduced locally elected police and crime commissioners. Their impact has been derisory. Voter turnouts have been between 10 and 20%. The police commissioners have dispersed electorates and minimal powers.

The concept works only in London, where the mayor is also commissioner and can bring the political weight of his mandate to bear.

Osborne seized on Manchester as the base for his northern powerhouse, and showered it with powers and money, provided it accepted his newfound fascination with elected mayors. In Manchester, at least, this made sense. Soon other cities were clamouring and were told to reorganise themselves into city regions and accept elected mayors. Osborne was forced to offer everyone more power, until England is on the brink of reordering itself into mini-regions, run by a third tier of local government under mayors, however inappropriate the political geography.

Osborne told Bristol to merge with Bath and Suffolk with Norfolk.

In doing so, the chancellor was reviving the various attempts at sub-regional government that have started and failed since 1974. Britain hates provinces. It knows and prefers cities and counties. Regions may reflect Whitehall’s bureaucratic convenience, but they are poor substitutes for local identity. The former local government secretary, Eric Pickles, understood this. He wisely said he “kept a pearl-handled revolver in my drawer to use on the first person who suggests local government reorganisation”.

Despite his good intentions, Osborne’s bid to restore local accountability to English government has hit trouble. It is unresearched and unconsulted, advancing in fits and starts.

Above all, he lacks a consistent concept of distributing power. His new planning regime obliterates local opinion. He intends, so far, to seize local councils’ most prized institutions, their schools, declaring local councillors unfit to run them. He is dumping NHS services on to local care authorities, with no extra money.

The result has been a fierce reaction from within the Tory party, from an alliance of county leaders, such as Kent’s Paul Carter and Norfolk’s Cliff Jordan, with disgruntled Tory backbenchers and peers. They see a prime minister and a chancellor in thrall to green-belt speculators and academy chains, careless of the countryside and of local people.

Now these county leaders are told they are to be overruled by “strategic” mayors for whom few will bother to vote. The Norfolk MP Sir Henry Bellingham compared the mayors to central government gauleiters. This alliance is now strong enough to veto Osborne’s reforms; it is torturing his budget aftermath and is rendering Cameron a minority prime minister in all but name.

Whenever asked, Britons say one thing loud and clear: they want more local accountability, not less. Their faith in modern government diminishes the closer it gets to the centre. An Ipsos Mori poll three years ago put trust in local government at 79% and in central government at 11%.

When offered more local devolution in the past, the public has tended to say no, thank you – as with John Prescott’s elected regional authorities in 2004. Locally elected mayors have won scant support in referendums, for instance in Birmingham, Manchester, Sheffield and Leeds, which remain firmly under party control. But people are keen on mayors where city government is seen as failing in the past, and where there is a strong sense of civic identity. Bristol’s George Ferguson, Middlesbrough’s Ray Mallon and Leicester’s Peter Soulsby stand out in this respect.

Next week London voters go to the polls to choose a successor to Boris Johnson. London’s two elected mayors have been an undeniable success. Johnson and Ken Livingstone may have fumbled reform of the capital’s police and transport unions. Johnson has left a metropolis forever scarred with planning disasters. But everyone knows whom to blame. London’s rash of luxury high-rises will forever be Johnson’s follies. No one wants the capital to go back under the control of a junior environment minister, as under Thatcher and Major.

Local government makes most sense when rooted in locality, in coherent communities used to running their own affairs. The cities and county boroughs inherited from the 19th century were such bodies. They attracted good local people to serve their councils, as happens today in Germany, France and the US. Local turnouts in the first two are between 60 and 80%. In Britain it is nearer 35%, a sure sign of democratic failure. Osborne’s random scatter of mayoralties is unlikely to stir the juices of accountability.

Proper democrats want someone local to hear and act on their complaints. They do not want to be perpetual supplicants at the gates of Whitehall, as the Hillsborough families have been. They want someone to blame, someone to sack, someone they know. Only in England is that someone denied them.”

http://gu.com/p/4tyx5

Tax avoidance isn’t the only problem …

“The Guardian has calculated that Green and his family collected £586m [from BHS] in dividends, rental payments and interest on loans during their 15-year ownership of BHS. Over the same period, the group’s pension fund went from a surplus to a deficit of £571m.”

http://gu.com/p/4tjzf

So, basically, Green robbed the pension fund, avoided tax, got a knighthood from Labour and was appointed “Waste Czar” by the Coalition!

Interestingly, Journalist Will Straw spotted this anomaly in August 2010 when he wrote an article entitled “Philip Green is an odd choice for efficiency tsar” in which he wrote:

Philip Green is clearly a savvy businessman, but his avoidance of tax raises questions about his suitability:

Earlier this week, David Cameron wrote in the Sun: “Cutting benefit fraud is a no-brainer. That’s why benefit fraud is the first and the deepest cut we will make.” Launching his one-sided crusade there was no mention of the tax gap, which dwarfs welfare and tax credit fraud by a factor of more than 10 to one. Cameron has now added insult to injury by appointing Sir Philip Green – a tax avoider – as his efficiency tsar.

David Cameron’s focus this week on tackling “welfare cheats” has underlined his priorities. The coalition is committed to an ideological programme of spending cuts worth £83bn by the end of this parliament – 60% more than planned by the Labour government. But, as the Guardian reported, there is just £1.5bn in benefit and tax credit fraud – the rest is due to system failure. Compare this with the £17bn on tax avoidance, evasion and non-payment identified in HMRC’s Protecting Tax Revenues report and you get a sense of whether we’re really “all in this together”.

Tax avoidance is not a crime, but it is certainly a poor qualification for taking on a new role as head of an “external efficiency review”. In 2006, using figures calculated by campaigning accountant Richard Murphy, the BBC’s Money Programme reported that Philip Green and his family had saved themselves nearly £300m the previous year living partly in Monaco, where residents do not have to pay income tax. …”

Devolution: Conservatives reject idea of mayors for rural parts of England

Scared they might get an Independent or worse (for them)? Scared a Mayor coming from Somerset might neglect Devon or vice-versa? Or a Mayor who doesn’t like Hinkley C? Or just plain scared of all these things happening over which they have no control whatsoever?

And this “bottom up” devolution – where exactly IS its bottom?

Plans for new elected mayors announced in the Budget by the government should be abandoned, Conservatives have said.

Local councillors and some MPs say mayors for three rural parts of England will add an expensive and unwanted extra tier of government. Councils could reject the idea and opt out of new authorities in Lincolnshire, the west of England and East Anglia, North Somerset MP Liam Fox said.

The government says it wants to help the local economy and devolve power.
Some Conservative councillors in the rural areas intend to try to block the policy, which will not be imposed on unwilling areas.

In his Budget in March, Chancellor George Osborne announced plans for elected mayors in the three areas.

Local authorities will vote on whether or not to accept detailed proposals by the end of June.

MPs dilemma

North West Norfolk MP Sir Henry Bellingham, said people would feel no affinity to a new authority and elections for a new mayor would attract a “pathetic” turnout.

He told the Today programme on Radio 4: “Now I don’t want a regional leader coming along and saying ‘look Henry you’ve been a bad boy, I gather you don’t want this incinerator, you don’t want these houses, well actually the region do want it and I’d like you to have it’.

“That is going to put MPs in a very difficult position and change their constitutional position.” While he supported the idea of devolution, he said plans for a new mayor should be put on hold.

‘Unstoppable momentum’

A spokesman for the Department for Communities and Local Government (DCLG) said it was making “huge progress” in making local areas more powerful by devolving power from Whitehall.

A source close to the chancellor said: “The devolution revolution taking place across the country has unstoppable momentum behind it.” Six new authorities, which will have elected mayors, have been established in mainly urban areas, with another expected this summer.

Conservative sceptics argue the plans will not work in rural areas. Passing extra powers to large authorities with accountable, high-profile mayors is one of the Mr Osborne’s central aims.

‘Bottom-up process’

Privately, some Conservatives have compared it to the government’s attempt to turn all English schools into academies, accusing it of forcing the plan on reluctant councils. One said councils had been “bribed and bullied” in a bid to make them accept the idea.

But a DCLG spokesman said: “The government is making huge progress towards rebalancing the economy and empowering local areas through the devolution of powers and resources away from Whitehall to local people.

“Ministers have been repeatedly clear that devolution is a genuinely bottom-up process – all proposals are agreed by local leaders, and the government will not impose an arrangement on any area.”

Chris Skidmore, the Conservative MP for Kingswood near Bristol, said he supported the idea, and a new West of England mayor would create a “powerhouse in the south”.

Directly-elected mayors would be put in place, he said, even if some authorities chose not to take part. He said: “If one council decides they don’t want to do a deal, the other three will go ahead with the same pot of money given to those three councils.”

Huge cost

Peterborough MP Stewart Jackson, who has secured a House of Commons debate on the topic, said politicians would not give the government a “blank cheque” to sign up for more local government with a weak mayor.

He said: “It’s not something when you’re talking of spending hundreds of millions of pounds over the next 30 years that any responsible elected politician accountable to their electorate can sign up to.”

North East Somerset Tory MP Jacob Rees-Mogg is also opposed.

The leader of the Conservative group on Norfolk County Council, Cliff Jordan said he thought the council would reject the policy.

The Labour leader of the Council George Nobbs supports the idea of devolution but also opposes the policy in its current form.

Cambridgeshire County Council, which has a Conservative leader, has already voted to oppose the plan as it stands.

The Local Government Association wants local areas to be able to accept new powers and extra funding offered by the Treasury without having elected mayors.

A spokesman said: “People should be free to choose the appropriate model of robust governance for their community.”

http://www.bbc.co.uk/news/uk-politics-36147593

“Blow for Pope as audit into Vatican finances forced to halt”

“… The first external audit of Vatican finances by an internationally respected accountancy firm has been halted.

In what will be seen as a blow to Pope Francis’ reforms, a letter on 12 April was sent to Holy See departments informing them the work of PricewaterhouseCoopers has been “suspended immediately”.

The letter, reported by Crux, was written by Archbishop Giovanni Angelo Becciu, one of the top officials at the Vatican’s Secretariat of State. It explains that any permission to hand financial data to PwC has now been revoked.

Australian Cardinal George Pell, Prefect of the Secretariat for the Economy, had commissioned PwC to review the Vatican accounts, work which had previously been done by an Italian firm. The audit by PwC was the first of its kind and was going to provide a complete picture of Holy See finances, including a valuation of all its assets.

But in his letter Archbishop Becciu said that Cardinal Pell’s instruction for Vatican bodies to co-operate with the firm had been overruled by “superior provision”. A spokesman for Pell said he was “surprised” by the suspension of the audit and expects it to resume shortly.

It leaves open the question as to whether this came from the Pope, his advisory body of cardinals or the 15-body council for the economy, led by German Cardinal Reinhard Marx, which oversees the work of Cardinal Pell’s department.

Crux reported that the point of contention by those opposed to the PwC audit was not transparency but a concern over the nature of the contract with the firm.

There has, however, been sustained resistance to the Pope’s reforms of Vatican finances which blew up when documents were leaked showing mismanagement of money. Those who leaked them, and the journalists who reported the material, are now being prosecuted in what is known as the “Vatileaks 2″ trial.

Cardinal Pell has also become something of a lightning rod for opposition with accusations of dirty tricks being made when the cardinal’s expenses were leaked.

Some of the strongest opposition to Pell’s work has come from within the Holy See’s Secretariat of State, traditionally the most powerful body in the Vatican, and APSA (Administration of the Patrimony of the Apostolic See), which manages Vatican assets. Both are believed to have resisted attempts to come under the oversight of Pell’s department.

The position of the cardinal, who reaches retirement age of 75 in June, is under pressure – things were made worse for him following four days of uncomfortable cross-examination by an Australian inquiry into clerical sexual abuse.

Pope Francis met with Pell this morning.”

http://www.thetablet.co.uk/news/5453/0/blow-for-pope-s-reforms-as-audit-into-vatican-finances-forced-to-halt

Maybe they need the South West Audit Partnership …

Guardian editorial slams devolution secrecy and lack of democracy

You can’t devolve powers to local people if they don’t know anything about it. The Tories need to come clean on what powers are on offer and how they will pay for them”

“Is the government’s “devolution revolution” stalling? The National Audit Office’s new report on English cities’ devolution deals, published last week, suggests it could be. The report makes clear what council leaders have been telling the government for months: many councils don’t know what powers are on offer to them, when they may get them, or how they will pay for them.

All these concerns should have been addressed much earlier in the process. Last year, the Tories blocked Labour amendments to the cities and local government devolution bill that would have made devolution work much better.

We called on the government to let areas choose whether they wanted a mayor or not, to publish a full list of services available for devolution, and to devolve resources alongside powers, so local areas aren’t just left to take the blame for government-imposed cuts. We also called for more devolution, beyond town halls to communities, giving people more control over the services they use.

Despite demands for more transparency, government ministers have become ever more secretive. In the past month alone, the communities secretary Greg Clark has refused two parliamentary questions and a Freedom of Information request to publish a list of which councils he’s talking to about devolution.

Transparency matters because you can’t devolve powers to communities if they don’t know anything about it. Involving communities will lead to better devolution deals because local people understand their own communities better than Whitehall does.

Polling by Ipsos Mori demonstrates a close link between awareness of devolution and positive attitudes towards it. Being open about devolution builds support, while doing deals in secret breeds opposition. That’s why the most successful transformations in public services are coming from local, not central, government. Plymouth council, for example, has set up more than 30 energy co-ops working with their community; Rochdale has recently mutualised its housing stock to give tenants a real stake in ownership, and Oldham council has improved care for older people and better conditions for care staff in its ethical care company.

Rochdale joins staff and tenants together as biggest mutual in housing
As leader of Lambeth council until 2012 I learned that giving communities a bigger voice leads to better public services. A tenant management board gave residents the power to lead the transformation of Blenheim Gardens housing estate in Brixton, improving repairs and rent collection, and cutting crime. A community-led youth trust is creating new opportunities for young people and tackling gang crime in some of the south London borough’s most disadvantaged communities.

This is real devolution – people getting the chance to influence decisions that affect them, and making the professionals who run those services listen more carefully to the people they serve.

The NAO raises concerns that devolution has been so tightly controlled by the chancellor, George Osborne, excluding even other government ministers, that it could go into reverse if there is a change of chancellor. How ironic that an agenda based on letting go is being so tightly gripped by a single over-controlling individual. And there is no consistency to the government’s approach. At the same time as the devolution bill was going through parliament last year, the government was pushing through a housing bill that centralised more than 30 powers in Whitehall.

Labour has argued for more ambitious devolution that shapes a new relationship between citizens and the state and redefines the relationship between local and national government.

We believe in devolution by default. That means a new approach that assumes powers will be devolved unless there is a compelling reason not to. We want to see resources devolved alongside powers, with fiscal devolution that ensures funding follows need. And we want devolution to mean something more than a transfer of power from one set of politicians to another – communities need a new right to request control.

Last week’s NAO report backs Labour’s charge that the government’s approach is too limited, too centralised and too controlling. This is a moment to be bold, to let go and let communities shape the devolved future they want for themselves.

http://gu.com/p/4tj35

BHS fall out

“As the clothing chain BHS goes bust with the loss of nearly 11,000 jobs, it’s worth recalling the hand of Sir Philip Green, the man who will share a part of the blame for its bankruptcy.

Green bought BHS in 2000 for a sum of £200 million and controlled it for 15 years, though it was registered under the name of his wife Tina, who lived in Monaco.

When he bought BHS, its pension scheme was in surplus. By the time he sold it – it was in deficit. It is estimated that his family received more than £400m in dividends from the company.

In 2004 alone, Green’s family got a £40m dividend from BHS.

A year later, he collected a £1.2 billion dividend from Arcadia – the group that owned BHS – making it the biggest paycheque in British corporate history. It was more than four times Arcadia’s profits, and Green claimed the company was in great health and BHS had plenty of opportunities to grow.

To add insult to injury, the £1.2 billion payout wasn’t taxed, since it went to his wife in Monaco. The couple were accused of tax avoidance.

All this came after Sir Philip Green was appointed by David Cameron to ‘lead a review of government waste‘, in 2010.

And just a few weeks ago – as BHS teetered on the edge of bankruptcy and a pensions scandal was about to erupt – Sir Philip Green bought himself a third luxury yacht.

By that point it was no longer his concern – he had washed his hands off BHS a year earlier for just £1.

He said at the time:

“The business is handed over in a sound financial position with significant cash balances and banking facilities in place.”

If BHS goes bankrupt, it likely won’t meet pension commitments to 20,000 people. Clearly, Green doesn’t care now.

What advice on spending money did the government get from this man?”

https://politicalscrapbook.net/2016/04/the-man-accused-of-driving-bhs-to-bankruptcy-was-appointed-by-cameron-as-a-waste-watchdog/

“Anywhere but Westminster” newspaper column want to hear from us

Worried about the ever-widening democratic deficit in East Devon? Enraged by the secrecy and vagueness of our devolution deal? Fed up with an MP who will not speak about his constituency in Parliament and won’t even live in it? Celebrating the rise of independents at every level of local government in the district? Here is how you get it to a wider audience:

“Anywhere but Westminster is travelling the country to get a sense of British politics away from the Westminster bubble. During this period old fashioned two-party politics has been diminished and a palpable sense of unrest with the status quo has emerged.

For their new series, the pair are back on the road, hunting out radical new politics in some unlikely place. We would like you to tell us where you think they should go?

Share your views in the form linked on the webpage below or get in contact with John Harris (@johnharris1969) and John Domokos (@JohnDomokos) via Twitter.”

http://www.theguardian.com/politics/2016/apr/25/anywhere-but-westminster-where-should-we-go?CMP=Share_iOSApp_Other

Devolution – the warts and dangers

Interesting talk by Professor Bob Hudson of Durham University who shares the fear of the type of devolution being forced on us in England.

Why was the LEP allowed to become business-heavy?

LEPs only have to have one-third business people, which would then leave councils in the driving seat of devolution. Ours ended up with two-thirds business and education (just another business these days) with councillors very much in the minority and in the back seat, or possibly even the boot.

How was that engineered and by whom?

We know that Paul Diviani has been an LEP board member since 2014 ( even though he did not tell other councillors about the LEPs role in devolution until September 2015), so he had to have been aware what was happening.

The selection process for ALL LEP members is shrouded in mystery … not a good way to conduct publicly funded business.

A mainstream newspaper finally sees flaws in devolution

“Bernard Jenkin’s new inquiry into the civil service doesn’t even mention devolution – yet it will determine the size and shape of Whitehall
Bernard Jenkin isn’t only the chair of a busy Commons committee, he is also a leading light of the out campaign to leave the EU – which isn’t going to pack up and go home, whatever the outcome on June 23. And now the public administration and constitutional affairs committee has just announced a mega inquiry into the civil service – structure, effectiveness and all – and is collecting evidence double quick, by early June.

Maybe Jenkin and fellow MPs will remedy this when they sit down to deliberate, but already they seem to have fallen prey to Whitehall’s chronic disease – myopic departmentalism. That’s odd because under Jenkin, the former public administration select committee singled out lack of strategic co-ordination as one of the centre’s besetting faults.

In 2016, to see the size and capacity of the civil service you have to look at what is happening to the rest of the public sector, including the devolved administrations. If English devolution goes further, Whitehall’s numbers, function (and culture) will be affected – yet the terms of reference for the Jenkin committee inquiry don’t mention the D-word.

Of course devolution isn’t a given. Localists have taken umbrage at the sceptical tone adopted in the National Audit Office’s (NAO) progress report on the devolution deals, especially its observation that there isn’t a great deal of rhyme or reason to some of the arrangements. The money being passed out to the (unaccountable) local enterprise partnerships far exceeds the supplementary investment grants going to the consortia of councils. Even in Greater Manchester, the most advanced and best favoured deal, the NAO can’t fathom what influence, if any, the new combined authority and mayor are going to have on NHS budgets. As for schools, the NAO notes dryly that proposals from councils to retain their role “have not been accepted by central government”.

Without clarity and local scrutiny we risk the prize of devolution
Here’s a paradox of devolution and one that really does get the localists foaming: handing over power (and even just promising to hand over power) requires the centre to have more bodies. The cities and local growth unit, run jointly by the communities and business departments, has 155 civil servants plus another seven in the Treasury dealing with devolution. All those departments are losing numbers, raising concerns about capacity to negotiate and implement deals.

There’s also accountability. When Lord Bob Kerslake was permanent secretary for the department of communities and local government, he asked some wide-ranging questions about who was in charge, as public services are contracted out and fragmented. The NAO comptroller and auditor general, Amyas Morse, recently refused to sign off the accounts of the Department for Education due to his opinion that “the level of error and uncertainty in the statements to be both material and pervasive”, which bears out Kerslake’s concern: Morse says he simply does not know whether academy schools are spending public money well enough.

The newly appointed permanent secretary for the Department of Education, Jonathan Slater, will have his work cut out. It’s not clear whether his previous experience as a senior officer in Islington council will be a help or hindrance. But his boss, education secretary Nicky Morgan, is adamant that forcing all schools to become academies will cut central interference – which ought to mean Slater will need even fewer civil servants.

The NAO poses a big question for Jenkin: what effect will devolution have on Whitehall’s departmental structure?

Another big question is what happens to the wider field of public management? If city regions and combined authorities are now doing things formerly dealt with in Whitehall, will their managers need different skills; will they be a different breed? To find out about the future of the civil service, the MPs will have to look outside Whitehall.”

http://gu.com/p/4thgx

Are we REALLY all in it together? Tell that to 11,000 BHS workers

2005:
The retail entrepreneur Philip Green has banked £1.2bn after awarding himself the biggest pay cheque in British corporate history. The huge dividend has come from the Arcadia fashion business, which has 2,000 outlets and spans high street names including Top Shop, Wallis and Burton. It is more than four times the group’s pre-tax profits of £253m.
http://gu.com/p/9d7v

2015:
The highest paid director at Sir Philip Green’s Arcadia Group received a 38% pay rise, to £1.55m, last year as the group cut 2,000 jobs.

The director, thought to be Ian Grabiner, Green’s right-hand man, was paid £1.55m in the year to 30 August 2014 according to accounts filed at Companies House. Total payments to directors rose to £4.22m, up from £4.05m a year before, despite board members dropping from five to three.

The payouts came as sales at the group, which owns the Topshop, Topman, Miss Selfridge, Evans and Wallis outlets, remained steady at £2.71m but operating profits (before exceptional items) slid to £172.3m against £204m.

http://gu.com/p/49jhg

2016:
Over the past 16 years, the BHS pension fund has fallen from a £5m surplus into a £571m deficit. More than £25m was paid from BHS to its [new] owner, Retail Acquisitions, in the 13 months between the department store’s sale and it collapsing into administration, the Guardian understands.

The man behind Retail Acquisitions is Dominic Chappell, a former racing driver who has been declared bankrupt twice. Chappell owns 90% of Retail Acquisitions, which bought BHS for £1 from Sir Philip Green in March 2015.

http://gu.com/p/4tjvn

Philip Green [domiciled in Monaco] buys third super-yacht and has a fortune estimated at £3.5 billion
http://www.dailymail.co.uk/news/article-3510128/A-100m-floating-gin-palace-pension-scandal-scupper-Sir-Topshop-Philip-Green-faces-calls-stripped-knighthood-buys-yacht-BHS-teeters-brink-bankruptcy.html

I doubt if Sir Philip was aware the twice-insolvent businessman’s Retail Acquisitions vehicle would use BHS money to pay off his dad’s mortgage. Or that it would be taking big “professional fees” and salaries out of the business for Chappell’s crew.”
http://www.standard.co.uk/business/jim-armitage-bhs-staff-needed-more-than-chappells-prayers-a3232901.html

More than £25m was paid from BHS to its owner, Retail Acquisitions, in the 13 months between the department store’s sale and it collapsing into administration, the Guardian understands.”

Guardian

Broadband (orlack of) for East Devon – the never-ending story

Recall that EDDC decided to pull out of the Devon and Somerset broadband bid citing the reason that the bid was not transparent!!!  They then applied for funding from another government source, assuring us that this would be successful, and it was refused – because, in part, it duplicated the bid that EDDC had decided to withdraw from!

Scrutiny Committee Minute 14 April 2016:

“The Portfolio Holder Central Services and the Portfolio Holder Finance continued to work with a number of providers to encourage as many as possible to come forward in filling the gap of service that phase 2 of the CDS project would leave , even though this authority does not control the budget for broadband delivery.

…..

RESOLVED

  1. That the committee supports the Portfolio Holder Central Services [Councillor Phil Twiss]  in his endeavours for alternative solutions to meet the needs of the areas not covered by the CDS project;
  2. That a progress report and revised timetable is requested from CDS;
  3. That the committee receives a further update from the Portfolio Holder Central Services in approximately six months time or as soon as there are further significant developments.

http://eastdevon.gov.uk/media/1674827/140416-scrutiny-minutes.pdf

 

 

Community Hospitals: the more you raise to improve them, the more rent the NHS will charge …

Sidmouth GPs are outraged about what they call the Catch 22 on community hospitals: the more the community has raised to improve the facilities, the more the commercial rent will be; so the less affordable it will be for health providers; so the owner (ie Jeremy Hunt) will be required by law to close it down and sell it off as real estate.

Meanwhile Mr Swire is delightfully rattled. Until he started to protest too much most people did not really care where his family’s £250 million income last year came from or how much tax was paid on it. Claire [Wright] is right… this one will run and run.


Robert Crick

Another voice on the unreliability of party politics

“… Our electoral system reliably herds voters through the old party gates at general election time, regardless of where we graze mid-term. Traditional allegiances have proved resilient enough in the past that the safe bet is on their endurance. We probably won’t get a grand political realignment out of this referendum, but we might learn how much we need one.”

http://gu.com/p/4tf69

“Academy plans pose ‘significant risk’ to government finance” says National Audit Office

… “In a critical assessment, the Department for Education’s annual accounts have been rated as “adverse” by the National Audit Office, which said there was no clear view of academies’ spending. Adverse is the most negative opinion that an auditor can give.” …

http://gu.com/p/4tfn6

Claire Wright continues to fight for tax transparency

“LAST week the Echo revealed that out of four local MPs asked about their tax affairs, only one (Ben Bradshaw) answered the questions put. And one (East Devon’s MP, Hugo Swire) wrote an extraordinary furious letter to the paper in response.

While steadfastly refusing to address the queries put to him, Mr Swire embarked on a furious tirade against those of us he sees as intruding into personal issues.

Tax avoidance by big business has been a hobby horse of mine since I campaigned in the general election last year.

I find it shocking that there is one rule for super wealthy oligarchs and multi-nationals – which have the potential to make massive contributions to public services, and another for the rest of us. Last year, despite its monumental profits, Facebook paid just £4,000 corporation tax in this country!

Of course, such financial contributions to the treasury are especially vital at a time of austerity when public sector budgets are subjected to crippling and swingeing cuts.

Those with the least are always hit the hardest when this happens, as they rely more on public services, such as benefits, buses and care, than the wealthy, who can afford cars, private healthcare and have access to plenty of cash.

I organised a demonstration against aggressive tax avoidance outside the Sidmouth Conservative club, in February, where Mr Swire often holds his surgeries.

I also lodged a motion (which the Devon County Council Conservative leadership hopes they have kicked into the long grass) aimed at clamping down on tax avoidance by county council contractors.

The final debate on this will be on May 12 at full council.

Mr Swire dislikes that the prime minister and chancellor have published their tax returns, describing the move as a “difficult precedent.”

But Mr Swire, didn’t the prime minister publicly pillory Jimmy Carr for his tax avoidance activities?

And doesn’t Mr Osborne say how keen he is to get big business such as Facebook and Google to pay tax more equivalent to their income generated in the UK?

Mr Swire suggests that if MPs are to be asked about their tax affairs people in public life should also be scrutinised, including newspaper editors, BBC journalists and councillors.

This is perhaps an issue for discussion, however, as I see it there are two big distinctions between MPs and newspaper editors or BBC journalists. A journalist’s job is to report the news. But an MP’s job is to make decisions, pass laws and act for their constituents. They are in a position of trust and are paid very well for that position… with money from the British taxpayer.

The taxpayers who pay the East Devon MP’s generous salary deserve a bit of openness about his tax affairs, now the public interest has understandably rocketed in the ongoing scandal that is tax avoidance.”

No doubt we haven’t heard the last of this story.
http://www.exeterexpressandecho.co.uk/letter-Claire-Wright-right-MPs-reveal-tax-returns/story-29143814-detail/story.html

Devolution – not all it is cracked up to be

There are significant accountability implications arising from ‘devolution deals’ which central government and local areas will need to develop and clarify, the National Audit Office has said.

In a report, English devolution deals, the spending watchdog said these implications included “the details of how and when powers will be transferred to mayors and how they will be balanced against national parliamentary accountability”.

The NAO noted that the ten deals agreed so far involved increasingly complex administrative and governance configurations.

It stressed that, as devolution deals were new and experimental, “good management and accountability both depend on appropriate and proportionate measures to understand their impact”.

The watchdog said that to improve the chances of success, and provide local areas and the public with greater clarity over the progression of devolution deals, central government should clarify the core purposes of the arrangements as well as who will be responsible and accountable for devolved services and functions.

Central government should also ensure it identifies and takes account of risks to devolution deals that arise from ongoing challenges to the financial sustainability of local public services, the NAO added.
HM Treasury and the Cities and Local Growth Unit are responsible for managing the negotiation, agreement and implementation of devolution deals on behalf of central government as a whole.

Amyas Morse, head of the National Audit Office, said: “Despite several iterations of deals, the Government’s approach to English devolution still has an air of charting undiscovered territory. It is in explorer mode, drawing the map as it goes along.

“Some of the opportunities and obstacles are becoming clearer, but we still do not have a clear view of the landscape or, crucially, an idea of the destination.”

Morse added: “Devolution deals provide important opportunities to reform public services. As with any experiment, some elements will work better than others. As we have said before, it is in the interests of both local areas and the government to know which programmes have the biggest impact for the money invested. Localism is not a reason for failure to learn from experiences or to spread best practice.”

Responding to the NAO report, a Local Government Association spokesman said: “Councils are working hard on implementing agreed deals and are working with government to finalise those deals which are still to be signed.

“It is imperative that the momentum is maintained to secure deals, especially in non-metropolitan areas whose economic potential is just as significant as that of big cities.”

“In terms of accountability, devolution has the potential to improve the democratic process by allowing decisions to be made closer to local people to best meet their needs. But councils should be free to put in place the appropriate model of governance for their communities and not have a ‘one-size-fits-all’ model imposed on them where significant new responsibilities are devolved.”

The LGA spokesman added: “The report rightly recognises the possible complications arising from differing geographies for service delivery and councils, particularly for the recently announced sustainability and transformation plans. Councils and their partners will continue to take a pragmatic approach to designing and delivering services that best meet the needs of their communities.

“We support the study’s findings that devolution needs to be accompanied by fair and sustainable funding by Whitehall to manage risk and ensure devolved areas can run services successfully.

“This will help to ensure that the opportunities provided by devolution – delivering economic growth, building more homes, creating jobs and a skilled workforce, and joining up health and care services – will be actively embraced by both local and central government.”

http://localgovernmentlawyer.co.uk/index.php?option=com_content&view=article&id=26690%3Aspending-watchdog-warns-on-devolution-deals-and-accountability&catid=59&Itemid=27

“Britain’s two-party political system isn’t working” – more Independents needed says former Conservative spin master

“Voters are disillusioned with a malfunctioning democracy. The system must change so independent candidates have a fair chance of election:

It doesn’t have to be this way. It’s clear that people are looking for a new kind of politics that goes beyond traditional party lines: a politics first and foremost of engagement and transparency, not reducible to the old left-right divide. …

… Change is long overdue. In the 1950s, politics was simpler. Workers voted Labour, the middle class and the wealthy voted Conservative. About 90% of votes went to one of these two parties. But by 2015, the combined total had dropped to just over two-thirds. Voters today are searching for new options beyond the two-party model. …

… In today’s age of nearly unlimited information, our world views are nuanced and sophisticated, but our creaking democratic processes struggle to reflect this. Where do you go if you are a Conservative on the economy, a Green on the environment, Labour on social justice, Liberal Democrat on human rights? That is not an unusual combination. But Westminster politics still pushes a false, binary simplicity. …

… Even if an independent candidate does get on the ballot, it’s next to impossible for voters to discover that there might be someone outside the two-party system who genuinely matches their views. …

… In today’s age of nearly unlimited information, our world views are nuanced and sophisticated, but our creaking democratic processes struggle to reflect this. Where do you go if you are a Conservative on the economy, a Green on the environment, Labour on social justice, Liberal Democrat on human rights? That is not an unusual combination. But Westminster politics still pushes a false, binary simplicity.

This is where the corruption comes in, because the principal barrier to a more open and diverse politics in the UK is money. Thankfully, it plays a far lesser role in Britain than America – where money from fundraising Super Pacs dominates campaigning. But even here, you need cash to stand for office, to run a campaign, to get elected. Who can afford to do that? Only the centralised party organisations. And where do they get their money? The same old sectoral interests – the financial industry on the right and the unions on left. …

… Even if an independent candidate does get on the ballot, it’s next to impossible for voters to discover that there might be someone outside the two-party system who genuinely matches their views. …

… If we’re ever going to see the kind of modern, responsive and open-minded politics that people are crying out for, we have to break the grip of the party machines and get more independent, and independent-minded, candidates elected to office, at every level of government. But such candidates face enormous obstacles. Only parties have the muscle to win most elections, and party insiders control candidate selections tightly.

The barriers to political participation must be removed and the stranglehold of the big party machines broken, so that the power can be taken out of the hands of the insiders, the moneyed interests and the Westminster power brokers – and put where it belongs: in the hands of the people.

http://gu.com/p/4tezd

‘One in four executives believes ‘corruption and bribery is rife in UK’ ‘

“More than one in four business leaders believe bribery and corruption is rife in the UK, according to survey conducted by accountants EY.

Twenty-eight per cent of UK respondents said corruption was widespread – an increase from 18% a year earlier – although lower than the 39% average of respondents to the survey conducted in 62 countries.

“Our survey finds that more than one in four executives in the UK believe that bribery and corrupt practices happen here, a worryingly high number in a country that prides itself on its strong corporate governance,” said EY’s Jim McCurry.

Ninety-eight per cent of UK respondents to its 14th annual global fraud survey also said they recognised the importance of being able to establish the ownership of entities with which they are doing business – a factor highlighted in the publication of the Panama Papers earlier this month.

Overall, 91% of the 3,000 senior executives from 62 countries who took part in the survey supported enhanced beneficial ownership transparency.
Last week in Washington, George Osborne and his counterparts from France, Germany, Spain and Italy announced new rules that will lead to the automatic sharing of information about the true owners of complex shell companies and overseas trusts.

The chancellor said the enhancing regulations were “a hammer blow against those that would illegally evade taxes and hide their wealth in the dark corners of the financial system”.

The survey, conducted before the details of 11.5m files from the Panamanian law firm Mossack Fonseca were made public, also found that half of all respondents were prepared to justify unethical behaviour to meet financial targets. This was a greater proportion than the 36% that could justify such behaviour to help a company survive in an economic downturn.

The EY report said: “Worryingly, deeper analysis of our survey results identifies that many respondents who are [chief financial officers] and finance team members, individuals with key roles in protecting companies from risks, appear ready to justify unethical conduct. The apparent willingness of these respondents to act unethically when under financial pressure is concerning. Could certain compensation arrangements be encouraging such behaviours?”

The survey found that respondents, though, believed that bribery and corruption did not take place in their own sectors. While 39% globally said they believed it happened in their country, only 11% said they thought it was the case in their sector.

“Bribery and corruption continue to represent a substantial threat to sluggish global growth and fragile financial markets,” the report said. “Despite increased regulatory activity, our research finds that boards could do significantly more to protect both themselves and their companies.”

Respondents in the UK also regard cybercrime as a high risk, with 80% of respondents citing it as a concern – more than elsewhere in the world.
“With the continuing enforcement of anticorruption measures, coupled with recent revelations about the misuse of offshore financial structures, business leaders here need to be focused on securing a deeper understanding of their clients, partners and suppliers. Enhanced transparence is only likely to rise up the political and public agenda, both here and in the rest of the world,” said McCurry.

He said EY, which itself has a tax practice, complied with ethical standards.

EY conducted 2,825 interviews 62 countries with executives responsible for tackling fraud – 50 of them were in the UK.”

http://www.theguardian.com/business/2016/apr/19/one-in-four-executives-believes-corruption-bribery-rife-uk