Beware of what you wish for

Jeremy Corbyn has managed to get onto the final ballot to become the next leader of the Labour Party and succeed Ed Miliband. Perhaps fittingly for an MP first elected in 1983, unlike others in that generation like Tony Blair and Gordon Brown, he looks like he believed every word of Labour’s 1983 manifesto (“the longest suicide note in history”) and still does. Unsurprisingly championed by the likes of Owen Jones, he’s a supporter of:

Despite twitter being much more vocally left than right wing even on my feed (!), interestingly there have been a lot of right wing tweeters gleefully suggesting taking up Labour’s offer of affiliating for £3 to vote for him as being a sure-fire way of killing off Labour’s chances in 2020. After all, in 2010, the total number of Labour members and affiliates voting was less than 300,000 (and many of those will have had more than one vote by being both a member and an affiliate), so it would only take perhaps 30-40,000 carpet-bagger anti-Labour affiliates to join and be able to get him to win. If you’re not planning on standing as a councillor, MEP or MP, perhaps that would even be worth risking expulsion if you’re a Tory member!

Or would it?

While Corbyn looks like a stereo-typical Bennite far left candidate of the sort that must surely be unelectable, things aren’t necessarily so straightforward. There are a few things today which mean that it isn’t certain that a revival of Tony Benn’s Alternative Economic Strategy of 75-76 would be rejected so clearly as it was back then. Writers like Owen Jones have made a popular career out of reviving much of it for the generations who, like him, weren’t even born when it was a live issue. Lots of people this year found Labour not properly left wing enough and preferred to vote for the Greens or in Scotland, the SNP. The protectionist core of that line would also be likely to appeal to many who supported UKIP. It is also noticeable that the front-running three candidates, Andy Burnham, Yvette Cooper and Liz Kendall, are all pretty uninspiring, either being in Burnham and Cooper’s cases, cabinet ministers from the Brown years or a robotic Blairite like Kendall. In trying to learn the lessons of defeat in 2015 each has awkwardly tried to use the language of aspiration but ineptly like someone speaking in a foreign language and hilariously missing the nuances that would make them sound genuine.

I wrote a couple of years ago that Miliband could, consistently with the policy, ambition and philosophy he had set out have moved towards favouring EU exit and that had he done so, he would have given himself more room to expand on his policies as well as define himself in a cause which would have hurt his Conservative opponents (even if a 200 seat majority might have been over-optimistic).  It wasn’t really a serious suggestion as it would have been a very big move away from the consensus in Labour since Kinnock had started the hard job of making them electable again after 1983, particularly for a politician who had only ever seen those times. However, Corbyn doesn’t have to worry about this. He could, as a long term left wing rebel within Labour easily position himself on the EU back on the platform he first won his seat on. With a referendum on EU membership in a couple of years, he could gain a decisive victory against a Cameron led “In” campaign. Regardless of the policies (and interestingly there was an article in the New Statesman last week reminding readers that the strongest anti-EU arguments were left wing ones), all those Tory rebels and UKIP supporters who believe in leaving the EU on the grounds of protecting or regaining national sovereignty would have a dilemma if Labour campaigned for exit. And only Corbyn of the four hopefuls could do so without it being seen as purely partisan.

If this happened and there were to be a referendum vote in favour of exit, it would be very likely to bring down the present government. A large slice of the Tory party might be encouraged by it to defect to UKIP. There would also be little point in those UKIP MPs and supporters campaigning against Labour in any ensuing General Election because they’d be united in keeping out parties who supported staying in the EU. Which might make Corbyn rather more likely to become PM than he might look today.

So, if you’re a Tory thinking of joining Labour to support Corbyn so that the policies you like can continue through to 2025 and beyond, beware of what you wish for. A bit of Schadenfreude at Labour’s pickle today could lead to the stomach ache of a government to make Tony Benn’s ghost smile*.

* Although it is also worth mentioning that it is possible that Corbyn could do all this and fail through being seen as proposing so much rubbish and with so little likelihood of having the competence to see it through that not only does he discredit his broad far left policies but also the whole idea of leaving the EU as being in any way desirable- the question is, do you feel lucky?


Too Shy Shy

I didn’t write much about the General Election campaign beyond a comment on Labour’s Zero Hours Contracts proposals. I’d felt for a long while that somehow, despite Ed Miliband’s oddness he was probably going to hobble somehow into Number 10 and that if he did, he’d probably be weak enough not to do anything too radical or harmful – most of his policy announcements or statements of general philosophy were pretty vapid and consisted of criticising the effects of market based policies but only replacing them with a temporary fix to hit a particular failing rather than to strike at the cause of that failing (eg by fixing energy prices- hastily amended to read retrospectively as capping them when in fact they fell regardless of intervention and those who’d fixed their rates ended up paying more than those who stayed on variable tariffs).

Since the surprise result last week of a clear Tory majority there has been a lot of speculation about what went wrong. Why did the polls stay level pegging even up to the eve of the election? Innumerable Labour MPs and pundits suddenly announcing that they knew their campaign and leader were duds all along (which struck me as deeply unfair – if they thought that, why not do something about it rather than let poor Ed, an obviously decent man, carry the can before circling to fight over the remains?).

The most interesting line has been about the phenomenon of the “Shy Tory” to explain why there were many more Conservative votes in fact than would have been predicted by the opinion polls. The first General Election I could vote in was in 1992 where the Shy Tory first came into view. I’d been a rather lackadaisical student Tory activist and my recollection is that nobody even in the student Conservative Association thought Major had much chance (perhaps skewed by fruitlessly trudging the streets of safely Labour Oxford East, perhaps because the Association’s membership included more right wing luminaries like Mark Reckless) so the overall result was a surprise.

The day before the election, on my train home from London I had the chance to read an interesting (if very long!) statistical analysis of opinion polling for the last 50 years of elections compared with the actual votes. I recommend reading it if you have time. The striking conclusion that it came to was that in 10 of the previous 12 elections, the opinions had understated the Tory vote share (now 11 of the past 13). It doesn’t go into the psychological or political reasons why this might be the case in any detail but rather looks at the methodology of polling (which was changed after 1992 because of how wrong it had got that result). Most strikingly of all, on its final page it suggests a Tory lead of 6 points for 2015, which is pretty much spot on. After reading it I was tempted, in the face of everything else coming out of the media, to put a bet on a Tory majority (which would have stymied it!).

From a personal perspective I can well see that there may be a Shy Tory effect. Those who read this blog regularly or know me well in real life (and in some cases describe it/me as rabidly right wing- though I’d prefer to think I’m at least reasonably measured and rational about it!) will not perhaps see me as particularly shy. However, I tend not to talk politics much with people I don’t already know well. At least not on a party basis. Curiously, I’ve found that often if you just talk about particular things that are happening or could be done, the discussion is more interesting and friendly. Until the point at which it transpires that what you’ve just said is Tory policy. Whereupon it gets taken down for being a sham or a front for some corporate conspiracy theory or a misdirection away from something else. Which makes further discussion redundant.

I was rather mortified last week when Mrs B told me she’d told the mum of one of OMB’s school friends, who I get on with well and who is also a local Labour councillor, that I’m a Tory member (fortunately she didn’t seem to hold it against me!). Even good friends of mine will accept it only generally in the context of it being an eccentricity that years of friendship makes just about tolerable. Memorably after the 2010 election one friend said she’d assumed I was a LibDem as it was as right wing as would fit with her idea of people she’d spend time with. So, I didn’t join with the rest of my facebook timeline in bombarding everyone with political messages (largely Labour, some Green) ahead of the election or indeed gloating about the result afterwards. It just isn’t worth the bother.

I think the phenomenon of Shy Tories will continue to exist until either there is an acceptance that not everything (or even most things) which might be proposed by the Tories are by definition evil or uncaring, or when many of those things are accepted and proposed by others so that you can support them without having to mention or be one of the Tories (the Blair effect). The reality is possibly that at least some Tories aren’t so much shy as just more introverted than those who want to shout their moral crusades on marches and placards, sound off on social media campaigns or to dominate a dinner party or pub night by chivvying everyone up to agree with them. We can find the campaigns run by The Sun and the Daily Mail to be cringeworthy without having to support those they are aimed against or be drawn into defending them and their proprietors.

Conspiracy or cock up – why couldn’t Thameslink buy British?

The £1.4bn contract to provide new Thameslink trains has been awarded to Siemens in Germany. Over a thousand jobs will be lost at Bombardier’s Derby plant. Something must have gone horribly wrong, someone must be to blame for all those jobs being lost when some of them might have been saved if only Britain bought British trains. Or so the argument goes.

British trains now just for museums?The boring fact is that all large contracts for the supply of goods, works or services which are bought for the public sector in the EU are subject to the EU Public Procurement Rules. These grew up to prevent EU countries from distorting their local economies by favouring domestic businesses over those from other parts of the EU – regulating the terms on which the private sector does business with itself turned out not to be enough to do this because the state everywhere is one of the largest customers around.

The rules set out in great detail how purchasing by the state has to be carried out to make all contracts contestable by all suitable businesses around the EU and to ensure that all bids are judged on the same criteria in the same way without giving an unfair advantage that could not be justified on economic grounds.

So, the Thameslink contract went out to tender and after applying all these criteria, the only decision that could be taken on the basis of the bidders’ responses was to award the contract to Siemens. Making the decision on any other, undisclosed criteria which would have disqualified Siemens would simply have led to an easy legal challenge by Siemens which would have resulted in the award to Bombardier being overturned or substantial damages being awarded to Siemens. Perhaps as the Transport Secretary said it would have been possible to have designed the particular process so as to give more weight to other criteria which might have given Bombardier a better chance, but the scope for doing that in a fair way would still have been limited.

All that has happened is that the rules of the EU have been implemented. Maybe the French and the Germans are “better” at designing their procurement processes to favour local businesses, but there’s no strong evidence of this. Eurostar, majority controlled by the state-owned SNCF has not bought French but gone with Siemens. SNCF also recently awarded a contract to supply the whole French railway network with that most iconic French product, the baguette, to a British manufacturer. SNCF has bought a lot of trains from Bombardier, as has the German railway, Deutsche Bahn – albeit that Bombardier manufactures trains in both France and Germany.

There are easy political points to be scored and they’re being scored all over the place – the unions say that somehow the evil Tories would rather buy from Germany than look after British union members, the Tories say that their hands are tied by the bad criteria chosen by Labour in 2008 and everyone says that Europeans don’t bother complying with inconvenient rules so why should we.

However, as with many EU issues, there’s a distinct lack of hard fact. It is implausible that the government would want to give a contract to a foreign manufacturer if it didn’t have to. The extent to which broader local economic impact can be taken into account in public procurement is fairly limited. We don’t know how much more economically advantageous the Siemens bid was than the Bombardier one. We don’t know that Bombardier would have put in the winning bid even if the criteria had been different and differently weighted – bidding is complex and technical and there is a competitive advantage to having a good bid preparation team. A parallel might be drawn with things like the Olympics and World Cups (FIFA corruption aside…) – objectively a country like ours will have much stronger underlying infrastructure and ability to deliver such projects than less developed countries but that doesn’t mean we can present a pitch that is always more appealing. At least in the trains scenario it is unlikely that there would be backhanders and bribes involved.

Finally, there’s no solid evidence that the UK is somehow too much more scrupulous in applying the procurement rules than its EU neighbours. One of the arguments put by pro-EU campaigners is that access to European markets for British business is worth the cost of opening up our markets. If in fact EU markets are closed, it begs the question why we should be part of the EU. Are there other benefits that make protecting British jobs and direct interests worth giving up? Closing up our markets in response would not be a solution because it would involve defeating the key underlying feature of the EU, the opening up of a huge, single market.

It would be nice if one day we could argue rationally about such real impacts of EU membership rather than have our politicians take the easy way out and the easy and unfounded arguments based on prejudice, whether it be about evil Tories, inept Labour, or vicious foreigners fooling us into giving away what they wouldn’t give us.

UPDATE – facts about the actual process

Part of the confusion in the media and political debate over the Thameslink train procurement has come from the use by Philip Hammond, the Transport Secretary of the term “value for money” in describing the reason for selecting Siemens. This was seen in Jeremy Paxman’s interview with him on Newsnight on 5th July where he was pressing the Secretary of State for a figure on the saving that was being obtained by going with Siemens over Bombardier. The unions and others have also criticised “value for money” as the award criterion by saying that crude comparisons of lowest cost would necessarily ignore the huge economic impact on Derby both for Bombardier employees and more generally for Bombardier’s local supply chain.

This is misconceived. I have now had the chance to do some quick research and have found the DfT’s own documents explaining the process and detail of the project. These are readily publicly available at the DfT’s Thameslink rolling stock page . The most interesting document is the set of presentation slides used to provide information to potential bidders ahead of the procurement process being launched back in April 2008 which can be found at Slide 80 makes it clear that the procurement was being conducted on the basis of selecting the most economically advantageous tender (colloquially known as “MEAT”) – that is, not the lowest price bid but the bid which offers the best combination of price and quality. Slide 77 sets out the weightings to be given to different features at the pre-selection stage, 40% going to “Business excellence and approach” and 60% on “technical capability and experience”. Having been tested at this first stage, these two elements would not generally be capable of being tested at the final evaluation stage.

The rest of the presentation gives a strong flavour for the key issues being considered by DfT as fundamental to the project. There is nothing there that would suggest that any thought had been put into preserving employment in the UK or maintaining a base of train production capacity. It would be interesting to see if a journalist could dig further into things to get hold of the documents for the next stage, the Invitation to Tender (“ITT”). The ITT will contain the actual detailed criteria on which the ultimate decision to award was to have been based upon.

A further feature of the Thameslink procurement is that it was not just a contract for a train manufacturer to build a load of trains. The DfT presentation shows that the project split into two interdependent parts – first, the building and maintenance of the trains, and second, a financing structure for leasing the trains to the train operating companies. This points to the strong possibility that even if Bombardier was able to put a good case for its ability to do the first part, it might have failed overall because Siemens found a better partner to provide the financing side of the deal.

At least on an initial inspection it looks like Philip Hammond was right that the terms of the procurement process put in place by the previous government made it difficult if not impossible to consider the broader economic impacts of letting the contract go out of the country in selecting the winning contractor. This cannot be seen to be a mere oversight. The detail of the publicly available information I’ve linked to gives a flavour of how much work went into the project from the DfT and ministers – added to this is the fact that the procurement process followed after in depth public consultation in a long-term project.

The procurement process started in the first half of 2008, before Lehman Brothers’ collapse but after Northern Rock. Unemployment was still low at what would subsequently be seen to be the end of a long period of growth and prosperity. Keynesian stimuli hadn’t been thought of as relevant to the British economy by any mainstream politician for decades. Being charitable one could say that the government at the time rightly concluded that designing the procurement of trains for Thameslink ought to be done on the basis of the best deal for the project rather than protecting Bombardier and jobs in Derby. We need to beware of the risks of hindsight.