Cameron/Orban press conference - Summary
- David Cameron was told by his Hungarian counterpart, Viktor Orban, not to treat Hungarians in the UK as migrants. Orban said this was very important to people in his country.
For us it is very important that we are not considered as migrants. Words matter here ... We would like to make it quite clear that we are not migrants into the UK. But we are the citizens of a state that belongs to the European Union who can take jobs anywhere freely within the European Union ... We do not want to go to the UK and take something from them. We do not want to be parasites. We want to work there, and I think that Hungarians are working well. They should get respect and they should not suffer discrimination.
Orban said there were 55,000 Hungarians working in the UK. They paid more in taxes than they claimed in benefits, he said.
According to our estimates, the Hungarians working in the UK altogether pay more contributions and taxes than the benefits that they get. So we belong to the world of the fair working people.
- Orban said that Hungary and other countries in the Visegrad group (the Czech Republic, Poland and Slovakia) were open to doing a deal with Britain over changes to welfare rules. At one point he said there was a “good chance” of a deal, and at another point he said the Visegrad Four (V4) would be able to agree. But he did not say what form this agreement might take.
I’m sure that we will be able to find a solution which is going to be suitable for the Hungarian employees, for the Hungarian citizens, and that is also going to serve the requirements the government of David Cameron set for itself.
- Cameron said he was still pushing his plan to stop EU migrants claiming inwork benefits in the UK for four years. But he stressed that he was open to alternative proposals that might reduce the immigration “pull factor”.
- Cameron signalled that he was prepared to introduce a tax on sugary drinks. Previously the government has ruled this out as an option. But in response to a question about a Times story saying the government had changed his mind, he confirmed a rethink was underway. He said:
I do not really want to put new taxes onto anything. But we do have to recognise that we face potentially in Britain something of an obesity crisis. When we look at the effect of obesity on not just diabetes, but the effect on heart disease, potentially on cancer, we look at the costs on the NHS, the life-shortening potential of these problems, we do need to have a fully worked-up programme to deal with this problem. And we will be making announcements later in the year.
Of course it would be far better if we could make progress on all these issues without having to resort to taxes. That would be my intention. But what matters is that we do make progresss. I think we need to look at this in the same way in the past we’ve looked at the dangers of smoking to health, and other health-related issues.
That is my commitment. We need a fully worked-up strategy. We shouldn’t be in the business of ruling things out. But obviously putting extra taxes on things is not something I aim to do. It’s something I would rather avoid.
That’s all from me for today.
Thanks for the comments.
Here is the Guardian’s Politics Weekly podcast, with Polly Toynbee, Rowena Mason, Toby Helm and Tom Clark discussing the Labour reshuffle and the EU referendum.
Updated
Don't treat us as migrants, Hungarian PM tells Cameron
Q: Have you been talking about reducing the four-year ban to three years? Or imposing a residency test?
Cameron says he has set out his proposals. If he does not achieve those goals, he rules nothing out.
He says his idea remains on the table until something as good takes its place.
Q: Will you, and the Visegrad four, accept some restrictions on benefits?
Orban says there are four areas where Cameron wants reform.
He says he supports three of them. In some of those, Hungary would go further.
He says he is grateful to the UK for raising these issues. It helps to have the UK raising these issues, because it is a bigger country.
But benefits are more difficult. He says “it is very important that we are not considered as migrants”.
We would like to make it quite clear that we are not migrants into the UK.
Orban says Hungarians do not want to take something from the UK. They go to work. He says they should not suffer discrimination.
But Hungary is open to reasonable suggestions that could eliminate abuses, he says.
He also says he will consider how the British could set up a system not involved discrimination.
He says the Visegrad four take the same position. But they will be able to agree, he says.
- Don’t treat us as migrants, Hungarian PM tells Cameron.
And that’s it. The press conference is over.
I will post a summary shortly.
Updated
Cameron signals that he is willing to impose a sugar tax
Q: Will you compromise on your four-year benefits plan?
Cameron says the welfare system provides something of an artificial draw.
It is complicated and difficult. But progress is being made.
Q: Are you considering a tax on sugary drinks?
Cameron says he does not want to put new taxes on anything. But we have to recognise we face an obesity crisis. Look at the costs on the NHS caused by obesity. We need a fully worked-up programme, and announcements will be made later this year.
He says he would rather make progress without taxes.
But we need to make progress.
Putting up taxes is not something he wants to do, he says again.
- Cameron signals that he is willing to impose a sugar tax.
Hungarian prime minister says Hungarians in the UK pay more in taxes than they claim in benefits
Q: How complicated were you talks today? How close are you to an agreement?
Cameron says these are complicated issues; not just on benefits, but on the other demands too.
Q: Is your demand for a four-year ban on benefits still essential?
Cameron says Britain has a different welfare system from other EU countries. It is not contributory, so people can claim straight away. His four-year plan is still on the table. But he is open to other proposals, he says.
He says he is confident they can make progress.
Britain brings a lot to the European Union. With goodwill and creative thinking they can find solutions, he says.
Q: What do you make of Cameron’s benefit plans?
Orban says the British statistical office says there are 55,000 employees in Britain who are Hungarian. There are 300,000 Germans, and 790,000 Poles.
The Hungarians in the UK pay more in taxes than they claim in benefits, he says.
He says his duty is to protect the interests of Hungarian.
- Hungarian prime minister says Hungarians in the UK pay more in taxes than they claim in benefits.
This is from the BBC’s Ben Wright.
Hungarian PM avoids saying anything about Cameron's 4 year benefit ban. Instead points out Hungarians contribute to UK economy.
— Ben Wright (@BBCBenWright) January 7, 2016
They are now taking questions. There will be two from Hungarian media, and then British questions.
David Cameron says it won’t be another 10 years until a British prime minister, this British prime minister, returns to Hungary.
David Cameron is speaking now. He says he came to Hungary in the 1980s as a student.
He says Britain and Hungary share the same perspectives on Europe. They want a Europe that works. And they want subsidiarity to apply.
He says he and Orban discussed Cameron’s proposals in some detail.
He does not want an ever closer union, he says.
He wants a Europe that adds to our competitiveness, not that takes away from it.
He wants a Europe with fair rules for countries in the eurozone, and those outside. This is an area where the UK and Hungary can make “common cause”.
On welfare, Cameron says he supports the free movement of people.
But he wants to deal with the pressures that movement creates.
There have been “good discussions”, he says.
But he says he is confident that he can try for an agreement at the February EU summit. If it takes longer, so be it, he suggests. What matters is the substance, he says.
Orban says he is not satisfied with the competitiveness of Europe. He supports the measures to improve it.
(Cameron has made demands for EU reform in four areas; one of those is competitiveness.)
He says most Hungarians are working hard in the UK. They contribute to the UK economy. If the UK wants to change something in this area, he will need the support of the four Visegrad countries. He says he thinks they would offer support.
David Cameron's press conference
Viktor Orban, the Hungarian prime minister, opens the press conference.
He says a UK prime minister lasted visited Hungary 10 years ago.
The UK is the fifth largest investor in the country, he says. Around 50,000 people work in Hungarian companies owned by British firms.
He says he will speak about the easier topics that came up, Syria and Iraq, and he will leave the harder topics for Cameron to talk about.
The Commons foreign affairs committee has published two transcripts, here and here, of conversations Tony Blair had with the Libyan leader, Muammar Gaddafi, in February 2011 when Blair was trying to persuade Gaddafi to stand down. Blair discussed the conversations in evidence to the select committee before Christmas.
My colleague Nicholas Watt is in Budapest to cover David Cameron’s meeting with Viktor Orban.
Here is his preview story.
And here is an extract.
Orbán is not a natural ally for Cameron. But he could be vital as the prime minister battles to win support for the most contentious proposal in his EU negotiation package – a four-year ban on EU migrants claiming in-work benefits.
Hungary is a key member of the Visegrad group of countries in central and eastern Europe whose admission to the EU in 2004 marked the high point in their journey away from the cold war Soviet grip as members of the Warsaw pact. The Visegrad group, whose largest member is Poland, share a determination to avoid restrictions on the millions of their citizens who have used the EU’s rules on free movement to work in the UK.
Yet, British officials are confident that Orbán could be a friend to Cameron as he seeks to broker a compromise with EU leaders on the four–year ban.
As a first step, the prime minister will need to avoid using the term “EU migrants” in Orbán’s company to describe eastern and central Europeans working in Britain. “To consider Hungarians in Britain as migrants is painful to our hearts,” Orbán said at a joint press conference with Cameron last month.
British officials say that Orbán, with whom Cameron enjoys good relations, is quite sympathetic to the UK. If Cameron can show that the UK is not taking him for granted then Orbán is expected to offer help in moving towards a deal at the next EU summit in Brussels next month.
Here is David Cameron being welcomed by Viktor Orban earlier.
Cameron's press conference in Hungary
David Cameron will soon be holding a press conference with his Hungarian counterpart, Viktor Orban.
There is a live feed here, on the Reuters website.
Lunchtime summary
- Labour HQ has insisted that that the party’s defence review will not consider the option of leaving Nato. The party was forced to issue a clarification after Ken Livingstone, the co-chair of the defence review, told the Daily Politics that it would consider the case for withdrawal from Nato. Livingstone said his own view was that it didn’t “really matter whether you are in Nato or not terribly much because the cold war is over”. In the same interview, he said he hoped the review would conclude before the Commons votes on Trident renewal.
- Livingstone has dismissed those Labour MPs who resigned from the party’s frontbench as a “disaffected little group of old uber-Blairites”. He said MPs like them did not have the right to overrule the party membership.
What we have got to remember is Jeremy has inherited a Parliamentary Labour Party well to the right of the membership. That is because during the four general elections under Blair and Brown, local Labour parties weren’t allowed to choose the candidate they wanted, they had to select from a list approved by the party bureaucracy. People who were critical of American foreign policy or wanted to crack down on the tax avoidance of big corporations never got onto the list. What these MPs can’t now do is say ‘We have got a right to override the wishes of the party membership’.
- David Cameron has said, following talks in Germany, that he is “even more confident” of getting an EU deal. (See 12.09am.) Separately Mark Rutte, the Dutch prime minister has also said he is “relatively optimistic” that there will be a deal on the UK demands in time for the EU summit in February.
- Lord Rose, leader of the Britain Stronger in Europe campaign, has accused those who want to leave the EU of indulging in “an impossible fantasy”. In a letter to the Vote Leave and the Leave.EU campaigns, he challenged them to explain what would happen if Britain left the EU. He said:
You claim that Britain can have all the benefits with none of the costs. You promise to simultaneously end free movement, end all contributions to the EU budget, opt out of economic rules and regulations, whilst still retaining full access to the single market.
This is nothing short of an impossible fantasy. If you can demonstrate otherwise, I’m more than happy to have that debated. But it’s simply not acceptable for your campaign to continue to duck questions about what ‘Out’ looks like. You must produce hard evidence to back up your assertions and be realistic about the economic consequences.
I therefore challenge your campaign to outline precisely the new trade deal you propose to secure that would replicate the benefits of full access to the single market with proof that it is both credible and achievable.
- Boris Johnson, the Conservative MP and mayor of London, has said Britain could have a “great, great future” outside the EU. (See 11.24am.)
- George Osborne, the chancellor, has said Britain should be ready for an interest rate increase. (See 9.03am.)
Labour HQ corrects Livingstone and says Nato membership not part of defence review
That was quick. Ken Livingstone has been slapped down. Labour HQ has put out a statement saying Nato membership will not be part of the defence review. A spokeswoman said:
The terms of the defence review are still to be agreed but will not look at our membership of Nato.
Six of the best comment articles on the Labour reshuffle
There is some good comment around today about the Labour reshuffle. Here are six of the best articles I’ve seen.
- Damian McBride, Gordon Brown’s former spin doctor, writes for the Times’s Red Box saying Corbyn’s reshuffle has united Labour’s various factions against him.
For the first time in two decades, the Blairites, Brownites and neutrals within the parliamentary Labour party are fully as one.
It helps that Corbyn managed to sack or sideline one of each in the only substantive moves of his reshuffle: Dugher, Pat McFadden and Maria Eagle all made to walk the plank; the first two with the frankly disgraceful accusation that they had been incompetent in their jobs.
Accusations of disloyalty are always in the eye of the beholder and can be taken on the chin, but to be accused of incompetence is a mortal insult in politics, let alone John McDonnell’s further jibe that those shadow ministers who resigned in protest at the McFadden sacking were right-wing.
So we are left with an unprecedented alliance between the two branches of the Labour party who have been at each other’s throats for 20 years, combined with the centrists who always refused to join either camp, all of them in a state of disillusionment or disgust at Corbyn’s leadership.
- James Forsyth in the Spectator says the reshuffle has left Corbyn more powerful.
There have been few more pathetic displays of political impotence than the tweets sent by shadow cabinet members paying tribute to Michael Dugher after his sacking by Jeremy Corbyn. Dugher, a classic northern Labour fixer, had taken on the role of shadow cabinet shop steward. He spoke out against Momentum, the Corbynite pressure group, warned against a ‘revenge reshuffle’ and criticised negative briefings against the shadow cabinet from the leader’s office.
But rather than protesting at his sacking through a walkout, shadow cabinet members confined their solidarity to a 140-character gesture. Their tweets, rather than looking like brave defiance of the boss, actually showed just how cowed they are.
It is important to understand that while the era of New Labour might be the crucial period as far as younger supporters of Corbyn and his supportive commentators are concerned, for the major players both around the leadership in Westminster and in the country, it is Neil Kinnock’s leadership of the party that is marks Labour’s fall from grace, not the Blair-Brown years.
“It was emblematic of Neil Kinnock’s turn to the right,” Diane Abbott told me recently, “that he abandoned his lifelong commitment to nuclear disarmament.” Corbyn and his allies now have a golden opportunity to undo Kinnock’s apostasy over the next year – with a policy change at party conference next year and with more full-throated opposition to the deterrent now that Eagle, who favours retaining Trident, is no longer in the Defence brief. While “revenge” for the battle gone over Syria may have been delayed, Corbyn is a better place for the one to come over Trident.
For once, I am on Jeremy Corbyn’s side. His shadow cabinet reshuffle makes sense. So do many of the other things he has been criticised for doing in recent weeks: backing Momentum as a grassroots campaign to support his leadership, seeking to reduce the power of Labour’s national Policy Forum, wanting Labour MPs to heed the views of party members and working with other left-wing groups in the Stop The War coalition.
(But Kellner’s article isn’t all positive for Corbyn. He also says that Corbyn’s politics are “ideologically mad, intellectually absurd and electorally disastrous”.
The first is to believe that the party is now divided into two warring tribes, in which only one can triumph. War to the death - or decisive split - is the only option. From Labour’s right, this is what former Blair advisor Peter Hyman has recently argued. From Labour’s left, it drives the grass roots movement to deselect Labour MPs. Plenty of those close to the leadership, like Momentum’s organiser Jon Lansman, have spent their political lives wanting to reduce MPs to delegates of the members.
The other route is to recognise that no one would have chosen to be here, but we have to make the best of it. A fight to the death will simply mean that we all die together. There is no reason to assume Labour will always bounce back; not when the social and economic conditions that created mass labour parties are disappearing right across Western Europe. Good will and hard work, could produce a Party more radical than in recent years, and a party in which most of the PLP and the membership can be comfortable. No one will get everything they want, but common ground might make progress possible.
What’s clear from the past two weeks is that Jeremy has not decided which route to follow. The choice between a uniting compromise and a fight to the death clearly haunts him. Much of his personal rhetoric suggests a desire to bring people together. Most of his actions point to the opposite. His chosen media voices are amongst the most divisive and confrontational figures in the party. Key staff appointments are people from the left’s Leninist fringe.
On what planet is it a good idea to start briefing about a reshuffle and it’s potential casualties over the period more commonly dedicated to peace, goodwill and a slow news cycle?
On what planet is it a good idea to then hold that reshuffle on the day your activists got up super-early, in the cold and the rain to leaflet stations across the country thus stepping all over your own fares campaign? ...
I haven’t finished. Because the other lot are just as bloody bad.
You are not entitled to a Shadow Cabinet position. When you get sacked, take it like a grown up and act with some dignity. Particularly if you know in your heart you’ve given the Leader every reason to do it. Yes, the crowing on the left is hideous. Don’t fight hideous with hideous.
If you want to coordinate a revolution, it will take more than three junior MPs with similar politics. If Corbyn is as unelectable as you think and should be got rid of, stop bloody serving in his Cabinet. Don’t idle up to saying so, resign and get it on a bloody t shirt. If you aren’t going to do that – en masse – then shut the hell up.
This is what Ken Livingstone said on the Daily Politics about Labour’s defence review considering the case for leaving Nato. He was responding to a question from Andrew Neil, who asked Livingstone if he favoured leaving Nato. Livingstone replied:
That’s one of the things we will look at. Many people want to do that. I don’t think it’s a particularly big issue because in the cold war it was, it isn’t now.
When Neil asked him to clarify that leaving Nato would be part of the defence review, he went on.
There will be people making those suggestions. We are looking at the entire defence review. My main view on this is it doesn’t really matter whether you are in Nato or not terribly much because the cold war is over. If we are to stay in Nato, the question is what’s it’s role going to be? Invading more countries in the Middle East? I’m not in favour of that.
Labour's defence review will consider case for leaving Nato, says Ken Livingstone
Ken Livingstone, the former Labour mayor of London, a key Jeremy Corbyn ally and co-chair of Labour’s defence review, has been on the Daily Politics. He said two significant things.
- Livingstone said he hoped the Labour defence review would be completed before the Commons vote on Trident.
Ken Livingstone says he hopes Labour will have a new position on Trident before Commons vote or by the summer. #bbcdp
— George Eaton (@georgeeaton) January 7, 2016
- He said the Labour defence review would consider the case for leaving Nato.
"That's one of the things we will look at. I don't think it's a particularly big issue" - Ken Livingstone on UK leaving NATO #bbcdp
— Sam Macrory (@sammacrory) January 7, 2016
In the past Jeremy Corbyn has backed leaving Nato, but during his leadership campaign he shied away from making this case, saying that there was no public appetite for leaving and focusing instead on the case for limiting Nato’s role.
John McDonnell, the shadow chancellor, has issued a statement saying George Osborne has himself to blame for the problems facing the economy. McDonnell said:
This chancellor has mixed his own cocktail of rising consumer debt, an over reliance on borrowing from overseas, with a lack of sustained investment, while failing to support manufacturing, and topping it all off with lighter regulations for the banks. The problem is that the rest of us taxpayers will be the ones left with the hangover.
Labour has consistently warned that George Osborne has to wake up and stop being complacent about the warning signs that the global economy could be slowing, but instead he has chosen to play political games with fiscal targets that would simply tie his hands.
We all know that the Tories have given up on an export-led recovery with manufacturing in a downturn and a trade deficit at worrying levels. Instead this chancellor has delivered a fragile, unbalanced recovery built on sand due to his austerity policies and he is now trying to get his excuses in early.
But just as the flooding over Christmas exposed that his cuts are hurting not helping, this speech today only tells the public what they already know - George Osborne has warnings but no solutions.
Cameron says he is 'even more confident' of getting EU deal following talks in Germany
David Cameron was in Germany this morning, in Bavaria, where he was attending a conference of the CSU (Christian Social Union), the Bavarian-based sister party of Angela Merkel’s conservative CDU (Christian Democratic Union). In a clip for broadcasters he said his talks had made him “even more confident” that he would get a deal on the demands he is requesting for his EU renegotiation. He said:
We believe that all these issues [the British demands] can be dealt with. The discussions are going well, they are hard, they are tough. These are difficult issues. But I am confident, with goodwil - and there is goodwill, I think, on all sides - we can bring these negotiations to a conclusions and then hold the referendum that we promised.
I’m even more confident after the excellent discussions I’ve had here in Bavaria with colleagues in the CSU that these things are possible, not just good for Britain, but good for Europe ... I have been very heartened by the goodwill I have felt from the fellow sister party members in the CSU here in Bavaria today.
In a written statement, Michael Gove, the justice secretary, has announced that Peter Clark, the former Met counter-terrorism chief, has been made chief inspector of prisons, and that Dame Glenys Stacey, the head of Ofqual, has been appointed chief inspector of probation.
Boris Johnson says Britain could have 'a great, great future' outside the EU
Talking of mayors, the current mayor of London, Boris Johnson, has been talking about the EU referendum. And he has been fuelling speculation again that he could back an Out vote.
Johnson refused to say whether or not he would be campaigning for Britain to remain in the EU. He hoped Britain would stay in a reformed EU, he said, but he needed to see if David Cameron would secure the appropriate reforms.
Then he went on:
If we cannot get the reforms we need, then Britain has a great, great future elsewhere, outside, in a different relationship.
Sadiq Khan, the Labour candidate for London mayor, is increasing his lead over Zac Goldsmith, his Conservative rival, according to the Evening Standard’s Joe Murphy.
Sadiq Khan ahead by seven points in mayoral race - up five pts since November. Source: New @YouGov poll coming out on LBC
— Joe Murphy (@JoeMurphyLondon) January 7, 2016
Khan gave a speech to the Resolution Foundation this morning. In it, he reaffirmed his desire to make London a living wage city. (The living wage, £9.40 an hour in London and £8.25 outside London, is the voluntary rate set by the Living Wage Foundation, and not to be confused with the “national living wage”, the new, beefed-up statutory minimum wage for over-25s coming in in April at £7.20.) And he called for the formula used to calculate the living wage to be adjusted to make more allowance for the very high living costs in London.
Before housing costs are taken into account, London has an equivalent – even lower – rate of in-work poverty than other regions. When you factor housing costs in, London has a far bigger problem.
Khan said he would use “carrots not sticks” to try to encourage employers in London to pay the living wage, including a procurement code that helps living wage employers and possible business rate discounts for small and medium-sized employers paying the living wage.
I’ll do what I can to make the case for the London living wage, but I’ll also seek to make it a far easier choice to take.
With the right financial devolution package, the mayor will be in a stronger position both to raise finance and to offer incentives for businesses to take choices that support the fairer sharing of the rewards of growth.
So first and foremost, I’ll seek to offer SMEs [small and medium-sized enterprises] business rate incentives for becoming living wage employers.
If the chancellor won’t give me that power – though I hope he will – then I’ll work with local authorities to spread the example already set by Brent and Lewisham Councils.
The Spectator’s Isabel Hardman has written a blog exploring why George Osborne is sounding so gloomy this morning. Here’s an excerpt.
Perhaps the chancellor is just covering himself in case the economy takes a turn for the worse. He’s acutely aware that crises tend to blow up out of things everyone has been ignoring at a time when everyone least expects it.
Or perhaps he’s worried about the real opposition he’s going to face over the next few years, which is from members of his own party both in Parliament and local government, as cuts to services like social care come in. Making the point that the bountiful and safe times aren’t here yet is one way of stopping those Tory critics from causing the chancellor trouble.
The Telegraph columnist Dan Hodges (Guardian readers least favourite journalist, if comments BTL are anything to go by) has been “streaking” down Whitehall this morning to honour a promise he made when predicting Ukip would do badly in the election. The Press Association have filed a story.
Political journalist Dan Hodges braved the rain as he streaked in Westminster after losing a bet.
The 46-year-old ran from Trafalgar Square in London and down Whitehall in nothing but trainers and a pair of black Calvin Klein underpants as a forfeit for underestimating the Ukip’s influence during last year’s general election.
In May 2015 he tweeted: “If Ukip break 6% I’ll streak down Whitehall” - but the party managed a share of the vote of more than 12%.
True to his word, Mr Hodges completed the run in 3.37 minutes, despite a bookmaker taking bets on where he might get arrested along the way.
Arriving at Parliament Square he said: “I actually feel invigorated, more people should consider naked running. Perhaps next time we can turn it into a mass charity flash streak.”
The sponsored feat raised more than £1,000 for Terence Higgins Trust and Elizabeth’s Legacy of Hope, through donations from Ladbrokes and an online page.
Hodges is not the first person to do this. In October last year the Lib Dem blogger Stephen Tall ran down Whitehall (almost) naked after saying he would do so if the Lib Dems lost more than half their seats in the general election. That was a very good example of why it is important for Lib Dems to learn to distinguish between promises that it is important to keep (tuition fees) and promises that are mere figures of speech.
George Osborne's Today interview - Summary
Here are some more lines from George Osborne’s Today programme interview. I have already quoted what he said about interest rates. (See 9.03am.)
- Osborne rejected claims that David Cameron’s decision to allow ministers to campaign for Britain to leave the EU marked a U-turn. Cameron had for a long time thought that ministers would have to be allowed a free vote, Osborne claimed.
Well [Cameron] hasn’t changed his mind actually. But again, I think most people accept that you know, I’m close to David Cameron and we work very well together and we’re good colleagues. And I know that for a very considerable period of time he’s thought it is right that when the moment comes and the question is put to the British public about whether we remain in the European Union, a reformed European Union which is what we’re looking for, or we leave, the individual members in the government, just like members of the public, should in a personal capacity should be able to express their opinion even though the government will have a taken an opposing view.
John Humphrys, the interviewer, pointed out that this was wrong, and that Cameron had said in January 2015 on the Andrew Marr Show that ministers would not get a free vote, but Osborne just brushed this aside, claiming Cameron had not changed his mind. Osborne implied Cameron was talking about something else in the Marr interview.
- Osborne rejected Lord Heseltine’s claim that allowing ministers a free vote in the EU referendum would make Cameron a global “laughing stock”. Osborne said: “I respectfully, on this occasion, disagree with Michael.”
- Osborne insisted he was not responsible for the Financial Conduct Authority’s decision to drop a review into the culture of banking.
That was a completely independent decision that I had no foreknowledge of, no advanced warning of. It’s got to be an independent decision for our banking regulator.
He also claimed there had already been an investigation into banking.
I would say that we did have that investigation; it was a cross-party parliamentary commission that included people like the Archbishop of Canterbury on it. We’ve implemented its recommendations, including, for example, a new regime where senior bankers have to be properly certified, held to account, can be found guilty of misconduct.
- He defended the decision not to keep Martin Wheatley as head of the FCA. And he said that Tracey McDermott, the acting chief executive of the FCA, would not get the job full time.
Martin Wheatley did a good job setting up the organisation but I think it needs new leadership to – and by the way this is a brand new consumer regulator that I have set up, which didn’t previously exist – but I think it needs new leadership to take it into its more mature phase where it has been established and we’re looking now for the very best candidate. To be fair there is a very effective interim leader in Tracey McDermott [who] has been doing a good job – she doesn’t want the job full time.
Updated
Labour junior frontbench appointments announced
Finally, the Labour reshuffle is over. This morning the party has released the names of six junior frontbench appointments.
Kate Hollern - shadow defence minister
Jenny Chapman - shadow education minister
Jo Stevens - shadow justice minister
Andy McDonald - shadow transport minister
Angela Rayner - shadow work and pensions minister
Fabian Hamilton - shadow Foreign Office minister
Economic policy making is partly about expectations management and today George Osborne, the chancellor, is out trying to shape our view of what 2016 is going to be like. He is giving a speech this afternoon, heavily trailed in advance, in which he will warn that the economy faces a “dangerous cocktail of new threats”. As Larry Elliott reports, he will say:
Anyone who thinks it’s mission accomplished with the British economy is making a grave mistake. 2016 is the year we can get down to work and make the lasting changes Britain so badly needs. Or it’ll be the year we look back at as the beginning of the decline. This year, quite simply, the economy is mission critical.
A further warning of sorts came when he appeared on the Today programme to talk about the speech. Asked if he wanted the Bank of England to put up interest rates, he said it was up to them. But then he went on to drop a very strong hint that he does expect rates to rise at some point. Britain had to be “ready” for an increase, he said.
The Bank of England is completely independent ... and it would be wholly inappropriate to put put any pressure [on it] and, by the way, people like Mark Carney [the governor of the Bank of England] would not respond to that kind of pressure because they are more than capable of making their own decisions.
But can I make this point. Just before Christmas the United States saw a rise in interest rates, the Federal Reserve put interest rates up. That was the beginning of the exit, if you like, from the very, very low interest rates in the so-called ultra-loose monetary policy that was put in place during the crash. Of course there will come a point where that happens in Britain, a decision made by our independent central bank. Rising interest rates can be a sign of a strong economy, and that was of course the justification the Federal Reserve used.
We’ve got to make sure in our country, and this is a responsibility of the government, not the Bank of England solely, that we are ready for whatever the interest rate environment is; that this time, for example, in a way that we didn’t do seven or eight years ago, we monitor overall level of indebtedness in our economy, that we take action to deal with particular booms or asset price bubbles, and things like buy-to-let mortgages, and I’ve taken action in that space. So we’ve got to be ready. But ultimately, if and when interest rates go up, that will be a sign of a stronger economy that is normalising after the extraordinary crisis of seven or eight years ago.
I will post more from the interview later.
Here is the agenda for the day.
9.30am: Sadiq Khan, the Labour candidate for London mayor, gives a speech to the Resolution Foundation on the “national living wage”.
1pm: Gordon Brown, the former prime minister, gives a speech at the Labour movement for Europe in Scotland campaign.
Early afternoon: David Cameron is due to give a press conference in Hungary after a meeting with his Hungarian counterpart Viktor Orban.
2.20pm: George Osborne gives a speech in Cardiff, where he will warn that 2016 has opened with a “dangerous cocktail of new threats”.
As usual, I will also be covering breaking political news as it happens, as well as bringing you the best reaction, comment and analysis from the web. I will post a summary at lunchtime and another in the afternoon.
If you want to follow me or contact me on Twitter, I’m on@AndrewSparrow.
I try to monitor the comments BTL but normally I find it impossible to read them all. If you have a direct question, do include “Andrew” in it somewhere and I’m more likely to find it. I do try to answer direct questions, although sometimes I miss them or don’t have time. Alternatively you could post a question to me on Twitter.
