How the UK Border Agency nearly blew Robin Hood Airport "sky high"

A calamity at the "Twitter Joke Trial" airport of which you will not have heard

The security managers of Robin Hood Airport are well known for their zeal in searching Twitter while off-duty for tweets containing supposed "bomb threats" which are nothing of the kind

But while those responsible with the safety of the public and of staff at this South Yorkshire airport were concerning themselves in January 2010 with the now infamous tweet of Paul Chambers, a infinitely more dangerous incident had recently occurred, about which there appears to have been no publicity until yesterday.

 

A dangerous load

On 10 November 2009 an aircraft carrying anti-tank ammunition landed at the airport. It appears the manager of the UK Border Agency (UKBA) based at the airport decided that his staff were to carry out checks on the packed ammunition. It was evident that this was a hazard, but the manager proceeded with the idea and even directed the plane to a separate part of the airport for the exercise to take place.

The pilot warned the manager that the crates of ammunition were explosive. The pilot added that the crates should not be examined by any unqualified staff. But the warnings were ignored. The UKBA manager had determined that unqualified staff were going to unpack live ammunition from its casing. (One presumes all this was also to be done on a concrete floor and in the near proximity of a fuelled aircraft.)

The UKBA staff did as they were told and opened the five crates, each of which contained five rounds of anti-tank ammunition.  The staff then partially removed some explosive devices from protective packaging. We are told that this entailed the staff removing three separate layers of packaging, including opening the protective tubing and exposing live rounds of the anti-tank ammunition.

It was about a stupid decision as such a manager could make, and a decision putting the lives of staff and many others at genuine risk.

 

A matter of Health and Safety

When this incident came to the notice of the Health and Safety Executive (HSE), there was an immediate investigation. It was clear that there had been a breach of Sections 2 and 3 of the Health and Safety at Work etc Act 1974

As the HSE later stated:

The HSE investigation found that UKBA had failed to carry out a suitable risk assessment to enable them to complete the checks safely. Had they done so, they would have recognised several problems.

There was a significant risk that the ammunition could detonate if it was dropped which could have detonated the whole cargo. As a result, members of the public, airport workers and nearby aircraft were all put at risk on that day.

This was an understatement.  Although ammunition is (of course) not designed to explode easily, unpacking such materials is rightly the job of trained professionals.

In normal circumstances, there would have then been a prosecution of UKBA for its fundamental breach of health and safety law.

 

Censure, not prosecution

But UKBA was not to be prosecuted. This is because, as a Crown body, it cannot be prosecuted. This constitutional oddity means that UKBA - and other such bodies - escape the processes of the criminal justice system even when there has been a clear breach of the legal obligations which nonetheless still apply to them.

So instead of a public prosecution, the HSE had to follow a closed process called "Crown Censure". This is, in effect, a sequence of meetings where culpability is discussed and eventually determined. The meetings are not public, and the minutes of the meetings are not provided to the public. (Indeed, the HSE press officer laughed down the phone when I asked if the papers could be made available.)

Eventually, UKBA "accepted" the censure. The HSE said:

Our investigation into the details of the cargo verification by UKBA staff at Robin Hood Doncaster Sheffield airport found that the failings by the Agency were serious enough to warrant this course of action.

The evidence brought to light by the HSE investigation would be sufficient to provide a realistic prospect of conviction of UKBA in civilian courts. This Crown Censure is the maximum enforcement action that HSE can take and should serve to illustrate how seriously we take the failings we identified."

We are then told:

Mr Paul Darling, Corporate Director, Resources and Organisational Development, of the UK Border Agency attended the Crown Censure meeting on 19 December 2012 at the HSE premises in Sheffield and accepted the findings on behalf of UKBA.

But this cannot be a satisfactory process for matters of public safety. A number of people were put at risk that day by the sheer irresponsibility of a UKBA manager.

 

Tweets and ammunition and "Security Theatre"

UKBA has now had two years and a bit to get its act together after almost blowing a good part of Robin Hood Airport sky high. A press statement put out today said:

We deeply regret this incident. As acknowledged by the Health and Safety Executive, we have already made significant changes to the way we manage health and safety to avoid a similar incident occurring in the future.

UKBA, however, did not tell what these "significant changes" were. 

The contrast of superficial and and sensible approaches to safety has been called by the great Bruce Schneier as "Security Theatre". In airports and elsewhere, a lot is done just for show, and the elaborate gestures do little or nothing to actually achieve improved security. 

It would seem Robin Hood Airport is a case study of such a misconceived policy. In the space of a few months between November 2009 and January 2010, one security manager there almost caused a disaster while another concentrated on a harmless jokey tweet. 

And only the latter led to the criminal process even being engaged.

 

David Allen Green is legal correspondent of the New Statesman and was defence solicitor in the "Twitter Joke Trial" appeal at the High Court

 

Robin Hood Airport, safe from menacing tweets at least. Photograph: B Doon

David Allen Green is legal correspondent of the New Statesman and author of the Jack of Kent blog.

His legal journalism has included popularising the Simon Singh libel case and discrediting the Julian Assange myths about his extradition case.  His uncovering of the Nightjack email hack by the Times was described as "masterly analysis" by Lord Justice Leveson.

David is also a solicitor and was successful in the "Twitterjoketrial" appeal at the High Court.

(Nothing on this blog constitutes legal advice.)

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We're racing towards another private debt crisis - so why did no one see it coming?

The Office for Budget Responsibility failed to foresee the rise in household debt. 

This is a call for a public inquiry on the current situation regarding private debt.

For almost a decade now, since 2007, we have been living a lie. And that lie is preparing to wreak havoc on our economy. If we do not create some kind of impartial forum to discuss what is actually happening, the results might well prove disastrous. 

The lie I am referring to is the idea that the financial crisis of 2008, and subsequent “Great Recession,” were caused by profligate government spending and subsequent public debt. The exact opposite is in fact the case. The crash happened because of dangerously high levels of private debt (a mortgage crisis specifically). And - this is the part we are not supposed to talk about—there is an inverse relation between public and private debt levels.

If the public sector reduces its debt, overall private sector debt goes up. That's what happened in the years leading up to 2008. Now austerity is making it happening again. And if we don't do something about it, the results will, inevitably, be another catastrophe.

The winners and losers of debt

These graphs show the relationship between public and private debt. They are both forecasts from the Office for Budget Responsibility, produced in 2015 and 2017. 

This is what the OBR was projecting what would happen around now back in 2015:

This year the OBR completely changed its forecast. This is how it now projects things are likely to turn out:

First, notice how both diagrams are symmetrical. What happens on top (that part of the economy that is in surplus) precisely mirrors what happens in the bottom (that part of the economy that is in deficit). This is called an “accounting identity.”

As in any ledger sheet, credits and debits have to match. The easiest way to understand this is to imagine there are just two actors, government, and the private sector. If the government borrows £100, and spends it, then the government has a debt of £100. But by spending, it has injected £100 more pounds into the private economy. In other words, -£100 for the government, +£100 for everyone else in the diagram. 

Similarly, if the government taxes someone for £100 , then the government is £100 richer but there’s £100 subtracted from the private economy (+£100 for government, -£100 for everybody else on the diagram).

So what implications does this kind of bookkeeping have for the overall economy? It means that if the government goes into surplus, then everyone else has to go into debt.

We tend to think of money as if it is a bunch of poker chips already lying around, but that’s not how it really works. Money has to be created. And money is created when banks make loans. Either the government borrows money and injects it into the economy, or private citizens borrow money from banks. Those banks don’t take the money from people’s savings or anywhere else, they just make it up. Anyone can write an IOU. But only banks are allowed to issue IOUs that the government will accept in payment for taxes. (In other words, there actually is a magic money tree. But only banks are allowed to use it.)

There are other factors. The UK has a huge trade deficit (blue), and that means the government (yellow) also has to run a deficit (print money, or more accurately, get banks to do it) to inject into the economy to pay for all those Chinese trainers, American iPads, and German cars. The total amount of money can also fluctuate. But the real point here is, the less the government is in debt, the more everyone else must be. Austerity measures will necessarily lead to rising levels of private debt. And this is exactly what has happened.

Now, if this seems to have very little to do with the way politicians talk about such matters, there's a simple reason: most politicians don’t actually know any of this. A recent survey showed 90 per cent of MPs don't even understand where money comes from (they think it's issued by the Royal Mint). In reality, debt is money. If no one owed anyone anything at all there would be no money and the economy would grind to a halt.

But of course debt has to be owed to someone. These charts show who owes what to whom.

The crisis in private debt

Bearing all this in mind, let's look at those diagrams again - keeping our eye particularly on the dark blue that represents household debt. In the first, 2015 version, the OBR duly noted that there was a substantial build-up of household debt in the years leading up to the crash of 2008. This is significant because it was the first time in British history that total household debts were higher than total household savings, and therefore the household sector itself was in deficit territory. (Corporations, at the same time, were raking in enormous profits.) But it also predicted this wouldn't happen again.

True, the OBR observed, austerity and the reduction of government deficits meant private debt levels would have to go up. However, the OBR economists insisted this wouldn't be a problem because the burden would fall not on households but on corporations. Business-friendly Tory policies would, they insisted, inspire a boom in corporate expansion, which would mean frenzied corporate borrowing (that huge red bulge below the line in the first diagram, which was supposed to eventually replace government deficits entirely). Ordinary households would have little or nothing to worry about.

This was total fantasy. No such frenzied boom took place.

In the second diagram, two years later, the OBR is forced to acknowledge this. Corporations are just raking in the profits and sitting on them. The household sector, on the other hand, is a rolling catastrophe. Austerity has meant falling wages, less government spending on social services (or anything else), and higher de facto taxes. This puts the squeeze on household budgets and people are forced to borrow. As a result, not only are households in overall deficit for the second time in British history, the situation is actually worse than it was in the years leading up to 2008.

And remember: it was a mortgage crisis that set off the 2008 crash, which almost destroyed the world economy and plunged millions into penury. Not a crisis in public debt. A crisis in private debt.

An inquiry

In 2015, around the time the original OBR predictions came out, I wrote an essay in the Guardian predicting that austerity and budget-balancing would create a disastrous crisis in private debt. Now it's so clearly, unmistakably, happening that even the OBR cannot deny it.

I believe the time has come for there be a public investigation - a formal public inquiry, in fact - into how this could be allowed to happen. After the 2008 crash, at least the economists in Treasury and the Bank of England could plausibly claim they hadn't completely understood the relation between private debt and financial instability. Now they simply have no excuse.

What on earth is an institution called the “Office for Budget Responsibility” credulously imagining corporate borrowing binges in order to suggest the government will balance the budget to no ill effects? How responsible is that? Even the second chart is extremely odd. Up to 2017, the top and bottom of the diagram are exact mirrors of one another, as they ought to be. However, in the projected future after 2017, the section below the line is much smaller than the section above, apparently seriously understating the amount both of future government, and future private, debt. In other words, the numbers don't add up.

The OBR told the New Statesman ​that it was not aware of any errors in its 2015 forecast for corporate sector net lending, and that the forecast was based on the available data. It said the forecast for business investment has been revised down because of the uncertainty created by Brexit. 

Still, if the “Office of Budget Responsibility” was true to its name, it should be sounding off the alarm bells right about now. So far all we've got is one mention of private debt and a mild warning about the rise of personal debt from the Bank of England, which did not however connect the problem to austerity, and one fairly strong statement from a maverick columnist in the Daily Mail. Otherwise, silence. 

The only plausible explanation is that institutions like the Treasury, OBR, and to a degree as well the Bank of England can't, by definition, warn against the dangers of austerity, however alarming the situation, because they have been set up the way they have in order to justify austerity. It's important to emphasise that most professional economists have never supported Conservative policies in this regard. The policy was adopted because it was convenient to politicians; institutions were set up in order to support it; economists were hired in order to come up with arguments for austerity, rather than to judge whether it would be a good idea. At present, this situation has led us to the brink of disaster.

The last time there was a financial crash, the Queen famously asked: why was no one able to foresee this? We now have the tools. Perhaps the most important task for a public inquiry will be to finally ask: what is the real purpose of the institutions that are supposed to foresee such matters, to what degree have they been politicised, and what would it take to turn them back into institutions that can at least inform us if we're staring into the lights of an oncoming train?