Miliband backs a National Investment Bank

The Labour's leader proposal is good economics and smart politics.

Ed Miliband's speech on banking this morning received little media attention, largely since the main points were previewed in his Mail on Sunday interview. But one story that few have noticed is that the Labour leader has come out in support of a National Investment Bank.

In an interview with the New Statesman last September, Miliband said: "It's an interesting idea. It's something Ed [Balls] and I have talked about. It's definitely an idea worth exploring." He went on to commission Nick Tott, a former partner of Herbert Smith LLP, to examine the case for such an institution. Toot's report has now been published and has concluded that "there is a strong case for a British Investment Bank." In his speech, Miliband said:

Partly because it’s always cheaper for banks to lend to big companies than small ones.

We don’t believe the banks we already have will be equal to the task of lending enough to small businesses.

That’s why we believe there is a case for a British Investment Bank.

Government recognising its role to guarantee lending to small business to provide the long-term finance it needs.

It was a similar institution in the United States which gave a young entrepreneur a loan in the early eighties when nobody else understood his sector.

His name was Steve Jobs.

And he founded Apple.

Every other major country understands that government needs to act to tackle this problem of financing.

It’s time that British business stopped having to compete with one hand tied behind its back.

As Robert Skidelsky argued in our special "plan B" issue last year, a National Investment Bank, with the power to borrow [unlike the coalition's Green Bank], and a mandate to invest in infrastructure, would both stimulate recovery and support long-term growth.

Miliband's decision to support the proposal is also smart politics. Vince Cable, who called for part of RBS to be converted into a National Investment Bank in a private letter to David Cameron, is growing increasingly frustrated with the coalition's failure to stimulate growth. In his interview with Andrew Marr yesterday, he accused the banks of "throttling the recovery" through their obsession with obsession with "short-term trading profits". It is precisely this problem that a National Investment Bank is designed to address. But the constraints of the coalition mean Cable is unable to say so. In coming out for an Investment Bank, Miliband is reminding the Lib Dems that they are, in many respects, closer to Labour on economic policy than the Tories.

Labour leader Ed Miliband said a National Investment Bank would provide "long-term finance". Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

Photo: Getty
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Rising crime and fewer police show the most damaging impacts of austerity

We need to protect those who protect us.

Today’s revelation that police-recorded crime has risen by 10 per cent across England and Wales shows one of the most damaging impacts of austerity. Behind the cold figures are countless stories of personal misery; 723 homicides, 466,018 crimes with violence resulting in injury, and 205,869 domestic burglaries to take just a few examples.

It is crucial that politicians of all parties seek to address this rising level of violence and offer solutions to halt the increase in violent crime. I challenge any Tory to defend the idea that their constituents are best served by a continued squeeze on police budgets, when the number of officers is already at the lowest level for more than 30 years.

This week saw the launch Chris Bryant's Protect The Protectors Private Member’s Bill, which aims to secure greater protections for emergency service workers. It carries on where my attempts in the last parliament left off, and could not come at a more important time. Cuts to the number of police officers on our streets have not only left our communities less safe, but officers themselves are now more vulnerable as well.

As an MP I work closely with the local neighbourhood policing teams in my constituency of Halifax. There is some outstanding work going on to address the underlying causes of crime, to tackle antisocial behaviour, and to build trust and engagement across communities. I am always amazed that neighbourhood police officers seem to know the name of every kid in their patch. However cuts to West Yorkshire Police, which have totalled more than £160m since 2010, have meant that the number of neighbourhood officers in my district has been cut by half in the last year, as the budget squeeze continues and more resources are drawn into counter-terrorism and other specialisms .

Overall, West Yorkshire Police have seen a loss of around 1,200 officers. West Yorkshire Police Federation chairman Nick Smart is clear about the result: "To say it’s had no effect on frontline policing is just a nonsense.” Yet for years the Conservatives have argued just this, with the Prime Minister recently telling MPs that crime was at a record low, and ministers frequently arguing that the changing nature of crime means that the number of officers is a poor measure of police effectiveness. These figures today completely debunk that myth.

Constituents are also increasingly coming to me with concerns that crimes are not investigated once they are reported. Where the police simply do not have the resources to follow-up and attend or investigate crimes, communities lose faith and the criminals grow in confidence.

A frequently overlooked part of this discussion is that the demands on police have increased hugely, often in some unexpected ways. A clear example of this is that cuts in our mental health services have resulted in police officers having to deal with mental health issues in the custody suite. While on shift with the police last year, I saw how an average night included a series of people detained under the Mental Health Act. Due to a lack of specialist beds, vulnerable patients were held in a police cell, or even in the back of a police car, for their own safety. We should all be concerned that the police are becoming a catch-all for the state’s failures.

While the politically charged campaign to restore police numbers is ongoing, Protect The Protectors is seeking to build cross-party support for measures that would offer greater protections to officers immediately. In February, the Police Federation of England and Wales released the results of its latest welfare survey data which suggest that there were more than two million unarmed physical assaults on officers over a 12-month period, and a further 302,842 assaults using a deadly weapon.

This is partly due to an increase in single crewing, which sees officers sent out on their own into often hostile circumstances. Morale in the police has suffered hugely in recent years and almost every front-line officer will be able to recall a time when they were recently assaulted.

If we want to tackle this undeniable rise in violent crime, then a large part of the solution is protecting those who protect us; strengthening the law to keep them from harm where possible, restoring morale by removing the pay cap, and most importantly, increasing their numbers.

Holly Lynch is the MP for Halifax. The Protect the Protectors bill will get its second reading on the Friday 20th October. 

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