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Cameron's Achilles' heel

Can the Conservatives handle the economy? The current opposition front bench is the least financiall

Every few months an invitation arrives on my desk to a meet a member of the shadow cabinet at an event organised by the "Conservative City Circle". These events, held in distinctive City locations such as the Mansion House, are designed to introduce movers and shakers in the Square Mile to David Cameron, George Osborne and other senior Conservatives.

The "cocktail parties", as they are engagingly described on the group's website, are a direct descendent of the "prawn cocktail offensive" conducted by Tony Blair and Gordon Brown in the run-up to the 1997 election. The Blair-Brown approach was designed to demonstrate to the world of finance that Labour had changed. Not only had new Labour taken on the trade unions and faced them down, but a new Labour government would recognise the importance of finance to Britain's economy. The free-market reforms and privatisations of the Thatcher era, which had been so bitterly opposed, would be left intact.

What is curious about the Conservative City Circle's 1950s-style cocktail parties and working groups is that they are needed at all. Historically, the idea of the Tories having to reach out to business and the City would have been risible. Business flocked to the party's doors and few self- respecting FTSE 100 companies would have omitted their hefty donations to the Conservative Party or think tanks with Tory connections.

Conservative frontbenchers didn't need to reach out to the City to be known and trusted, because they were of the City. The old merchant banks, such as N M Rothschild, were hothouses of Conservative talent. Not because they were inherently political, but because a City training in bids and deals, trading, privatisations and the like was considered an excellent education for future politicians. The idea was to establish a career, make enough money if possible and then put those talents to use in the House of Commons and government.

How much things have changed. When Peter Buckley, chairman of the publicly quoted Cayzer family vehicle Caledonian Investments (which owns a big stake in the investment bank Close Brothers), chose earlier this year to attack Labour and support the Tories, he attracted a torrent of criticism from corporate governance mavens.

In a note to shareholders, Buckley wrote: "Shorn of integrity and economic competence, rooster Brown has even less feathers than rooster Blair and lacks the latter's knack of preening himself." He backed up his words with the promise of a £75,000 corporate contribution to the Conservatives.

In fact, one of new Labour's greatest achievements - or betrayals - has been its seduction of business and the City grandees. In the Blair-Brown era, the succession of top business leaders willing to serve as policy advisers was stunning. And it hasn't stopped under Brown and Darling,

It was no coincidence that the rescue of Halifax Bank of Scotland (HBOS) by Lloyds TSB was partly cooked up a City grandee - Sir Victor Blank, chairman of Lloyds - in a "chance meeting" with the Prime Minister at a reception hosted by Citigroup, one of the world's largest banks. Nor that the top figures at both banks - Blank and Lord Stevenson, chairman of HBOS - are both regarded as business pals of Labour.

Indeed, the former chief executive of Halifax, Sir James Crosby, is the person Labour is counting on to deliver groundbreaking reforms to Britain's creaking mortgage market.

The remarkable fact is that the current Tory front bench, which within 18 months could be assuming the reins of political power at a moment of unprecedented economic turbulence, is among the least City-savvy in a generation. This is why it needs to go out and look for financial and business experience through the "City Circle".

"The problem for the Conservatives is that the front bench is largely made up by a new breed of professional politicians who know very little about anything except PR and politics," remarks Dr Andrew Hilton, director of the independent think-tank, Centre for the Study of Financial Innovation (CSFI).

Hands-on experience

Hilton is scathing about the current Conservative leadership. "The lack of financial experience is a big lacuna. The route now is straight out of Oxford and Cambridge, into PR or political research and, before you know it, they've made it on to the front bench," he says. Asked to name a prominent Tory with the requisite financial experience, he could only suggest David Gauke, MP for South West Hertfordshire, who worked for a leading City law firm, but hardly registers among the top-ranking Conservatives.

Among the new Tory frontbenchers, David Cameron, the son of a stockbroker, is one of the few who can claim that knowledge of the financial world courses through his veins. His hands-on business experience stems from his short period as communications director of the tele v ision franchise Carlton, now part of ITV.

His time at Carlton stored up troubles for Cameron among the notoriously hard-to-please financial press. The BBC's influential former business editor Jeff Randall, now an editor-at-large for the Daily Telegraph, is among his sternest critics. "In my experience," he noted in the paper, "Cameron never gave a straight answer when dissemblance was a plausible alternative."

The shadow chancellor, George Osborne, also has a "trade" background. The quoted family firm Osborne & Little is a favourite among interior designers for its catholic collection of wallpaper and soft furnishing designs. Osborne is thus familiar with the travails of medium-sized firms in a globalised world and, to his credit, he has surrounded himself with informed thinkers such as Matthew Hancock, formerly of the Bank of England.

When the Northern Rock crisis first broke a year ago, Osborne was quick to embrace the idea of an old-fashioned Bank of England-organised rescue, where City banks would offer a lifeboat to a failing bank. This is precisely what has happened with Alliance & Leicester, Bradford & Bingley and, most recently, HBOS. Osborne was also supportive of Mervyn King's proposals for a strengthened deposit insurance scheme at a time when Labour has dithered and delayed.

But there is no hiding the fact that, unlike previous Tory shadow and real chancellors, his experience and knowledge of finance is negligible. Oliver Letwin, shadow chancellor under Mich ael Howard, may have lacked political gravitas, but he came with the stamp of N M Rothschild. Ken Clarke was a heavyweight political operator with commercial experience gained as a lawyer, and John Major had climbed through the ranks at Standard Chartered, one of the nation's most successful banking concerns. Even Norman Lam ont could boast a career at N M Rothschild from 1968 to 1979.

As PM, Margaret Thatcher was surrounded with people with serious City and business experience. Peter Walker was a junior partner in the asset-stripping bank Slater Walker, William Waldegrave was a Dres dner Kleinwort Benson veteran, Michael Heseltine an entrepreneur who founded one of the UK's most successful private companies, Hay- market Publishing, and so on. Thatcher also had her late husband Denis, a former senior executive of his family business Burmah Oil (since swallowed up by BP), to whisper in her ear.

David Davis, a senior executive at Tate & Lyle, was one of the few business heavyweights in Cameron's shadow cabinet, but he now adorns the back benches after his decision to seek re-election on an erosion of freedoms platform. The shadow trade secretary Alan Duncan boasts a period as an "oil trader" on his CV. But one would been hard-pressed to judge, from his performance on the BBC's Question Time a week ago, what his understanding is of the scale of the financial crisis facing Britain.

Among the leading City figures now at Cameron's elbow is Michael Spencer, the extrovert chief executive of Icap, an electronic broker and City derivatives trading firm which has been suggested as a potential merger partner for the London Stock Exchange. As treasurer for the Tories, Spencer has been in perpetual motion in recent times.

When I visited him at his offices in the months after the credit crunch hit, he was entertaining an exclusive group of high-street bank chairmen whom he was seeking to persuade of the wisdom of supporting Cameron and his team. His success in the City, in one of the most volatile periods of recent times, has won him credibility among his fellow financiers. He is also one of the City's most accomplished philanthropists, with a particular devotion to Africa. But because of recent personal problems, it is unlikely that he will play a very prominent role at conference.

At a time of unprecedented financial turmoil, almost certainly the greatest banking crisis since the Great Depression, Tory expertise in the increasingly complex and globalised world of finance seems thin on the ground. Vince Cable, the Liberal Democrat economic spokesman, demonstrated throughout the current crisis that it is possible constructively to oppose and come up with credible ideas without talking the economy down. But Cable has hands-on knowledge of business from his period as chief economist of Shell.

The Conservatives' failure to say anything significant about the current catastrophe is unsurprising, when it falls so far outside the comfort zone of their present front bench.

This article first appeared in the 29 September 2008 issue of the New Statesman, The crash of 2008

Chris Ball/UNP
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The fish-eaters and the fasters

With a population split between whites and Asian Muslims, in some ways Nelson in Lancashire feels like similar-sized towns in Ulster: two communities separated by a gulf of non-communication.

In the late afternoon of local election day this month, the chairman of Nelson Town Council was working the terraces of old cotton weavers’ houses on his patch. Sajid Ali was wearing a red rosette and a navy blue cardigan over his capacious white shalwar kameez, and what looked like his dancing shoes.

This was not the forlorn ritual of unanswered doors, blank looks and curt responses habitually experienced by Labour canvassers even in more promising political times. Along these streets Sajid is a figure of some consequence: a jolly fellow and, as one opponent put it, an “interesting character”.

Almost everyone was in; Sajid knew almost all of them; and they in turn understood what was required. Sometimes a quick burst of Lancy Punjabi did the job: “Salaam alaykum, yoong maan, how yer doing? What time yer coomin’ to vote?” To older voters his spiel would be entirely in Punjabi and the response would often be a head-wobble, that characteristic south Asian gesture, which, when given to Westerners, can be baffling, but in these cases clearly signified solid intention.

The Labour candidate in the Brierfield and Nelson West division of Lancashire County Council, Mohammed Iqbal, held his seat comfortably on the day his party lost control of the county. And he did so on a poll of 58 per cent: a far higher turnout than in any of the other, whiter areas of Pendle; the highest in Lancashire; and higher than wards with these demographics would usually expect even at a general election. The average across Lancashire on 4 May was 37 per cent. It seems reasonable to conclude that the votes from those of ­Pakistani heritage, marshalled by Sajid, were wholly responsible.

Nelson is a strange, sad, divided, forgotten old cotton town, not without beauty. The weavers’ houses are stone not brick, which, elsewhere, might make them rather chic. A few minutes from town is wonderful Pennine countryside, and to the north the view is dominated by Pendle Hill itself, brooding like some sleeping sea monster.

Pendle is both the borough council and the constituency, where the mix of urban and rural has delivered it to the winning side in seven of the eight general elections since its creation 34 years ago. (Labour took it, five years prematurely, in 1992.) No one seriously believes the 5,400 Tory majority is in play. Nonetheless, Nelson can explain a lot about British politics in 2017.

“This was a cracking town,” said John Bramwell (“John the Fish”), who has been purveying cod, haddock and non-stop banter to Nelson for 41 years, first on the market, now from one of the last white-run, independent shops in the town centre. Nelson had a football team that played fleetingly (1923-24) in the old Second Division, what is now called the Championship. And in 1929 the Lancashire League cricket team, flashing cash in a manner that baffled the national press, signed Learie Constantine, the most gifted and thrilling West Indian all-rounder of his generation.

“When he arrived, no one in Nelson had ever seen a black man close-to,” said Derek Metcalfe, the club’s historian. “People would cross the road when he passed by. But he grew into their affections. He was a highly intelligent man as well as a great player.” Constantine, after a post-cricket career in the law, Trinidadian politics and diplomacy, finished life in the House of Lords as Baron Constantine of Maraval and Nelson, Britain’s first black peer. In July 1943 the Imperial Hotel in Bloomsbury accepted his booking but not his presence, and he promptly sued. His victory at the high court the following year was an early landmark in the fight against racial discrimination.

It was the 1950s before Nelson would get used to seeing non-white faces again, when the mill owners, battling labour shortages and overseas competition, turned to Pakistan to find biddable and affordable workers. They found them in Gujrat District, which is not one of the more worldly places, even in the rural Punjab.

“The first group were young men who in many ways integrated better than they do now. There were no mosques. They went to the pubs with their workmates and knocked around with local women. Then they had to go to the airport to collect the intended wives they hadn’t met yet,” recalled Tony Greaves, the Liberal Democrat peer who is deputy leader of Pendle Borough Council.

The mills disappeared, gradually but inexorably, but the Pakistani community kept growing and has now reached its fourth generation. The young men do not normally spend time in pubs; indeed, in a town of 30,000 people, there are only two left, plus a couple on the outskirts. It is hard to imagine anywhere that size in Britain with fewer. There are, however, at least a dozen mosques. The 2011 census recorded 40 per cent of the population as Asian, but on market day in the town centre the proportion seems much higher. The most prominent retail outlets are two bazaars: the Nelson (the
old Poundstretcher) and the Suraj opposite (the old Woolworths). Few white faces are seen in either: the saris and hijabs are beautiful but of little interest. They are all imported to this textile town from south Asia.

The white people have retreated, either out of the town altogether or to the semis of Marsden, on the hill. In the visible life of Nelson, they are clearly a minority. Population change on this scale can be accommodated, if not always easily, in large cities. It is a different proposition in a small town that was once tight-knit and, despite its closeness to larger places such as Blackburn, Accrington and Burnley, largely self-contained.

Even after 60 years, hardly anything has melted in the pot. The early migrants were villagers who placed little value on education. Recent history has led Muslims all over the world to turn inwards, to their own religion and culture. This is being exacerbated by white flight and by the advent of religious free schools, a disaster for anywhere in search of cohesion. The old Nelsonians have turned away. “Nelson is not multiracial or multicultural. It is biracial and bicultural,” says Greaves. “I would love to tell you that I go round to Abbas’s house to have chicken jalfrezi and he comes to mine for steak pudding and chips,” says John the Fish. “It’s just not like that.”

Unemployment is high at 18 per cent; there is no shortage of taxis. Educational attainment is patchy. Teachers at the two high schools fear their best pupils will be creamed off further by the promised grammar-school boom.

The vicar of Nelson, Guy Jamieson, and at least some of the local imams do their utmost to make connections between the communities. In certain respects Nelson feels like similar-sized towns in Ulster: two communities separated by a gulf of non-communication. In other ways, this description is unfair. When Burnley, just four miles away, suffered riots in 2001, Nelson stayed quiet. I could sense no threat, no active tension, merely resigned indifference on both sides. “There’s a poverty of confidence,” Jamieson said. “They don’t know how to sit down and engage.”

***

A modern English town council, subordinate to Brussels, Westminster, county and district, is an improbable power base, but Sajid Ali seems to be making Nelson’s work. Its precept is only £330,000 a year but this is not capped, so it suits both district and town if Pendle offloads smaller assets: parks, play areas, community centres. It is a minimalist form of devolution, but harks back to the days when Nelson was a borough in its own right, and looks forward to an improbable future when our towns might again be allowed to take their own decisions as they do in more grown-up countries.

But the council votes on party lines, Labour’s 16 councillors trumping the Tories’ eight. “They won’t work with us,” Sajid says flatly. “They don’t run it fairly for the town itself,” says the Conservative Neil McGowan. “If we put something forward for Marsden, we are always outvoted. One council official told me they’d never come across a town like it.” In Tony Greaves’s words, “The
politics in Nelson were always sour.” In the 1930s it was known as Little Moscow.

When I first met Sajid, however, he was outside a polling station doing a stint as a teller and laughing merrily along with his blue-rosetted counterpart, Arshad Mahmood. Yet things were not quite as they seemed. Mahmood was part of a mass defection of Pakistani Lib Dems to the Conservatives which appears to have nothing to do with Brexit, extra taxes for the NHS or Maymania. What it does have to do with remains elusive even to local politicians: “clan politics” and “personal ambition” were mentioned. It may be even more complicated than that. “So you’ll be voting for Theresa May next month?” I asked Mahmood. “Oh, no, I like Jeremy Corbyn. Very good policies.”

Perhaps this helped Sajid maintain some enthusiasm for the bigger campaign ahead, though he was daunted by one fact: the general election coincides with Ramadan, and dawn-to-dusk fasting comes hard in these latitudes when it falls in summertime. Still, he was impressed by all the new members Corbyn had brought to Labour: “The way I see it is that each new member has five, ten, 15, 20 people they can sell the message to.”

This seemed a bit strange: it implied he thought politics in the rest of Britain worked as it did in these streets. He had boasted earlier that he knew everyone. “All over Nelson?” “Oh, no,” he had backtracked. “In the English community nobody knows their next-door neighbour.” Which was an exaggeration, but perhaps not much of one.

There were no posters along Sajid Ali’s streets – not one. The information about which house to choose was on the canvass return and, more significantly, in his head. Just once he got it wrong. A little white girl opened the door and then a tattooed, muscular figure in a singlet barrelled towards the door. He wasn’t aggressive, just brisk. “Naaw. I doan’t vote.” End of. It was a sudden reminder of the norms of modern British politics.

***

Another norm is that, at any local count, no one ever thinks much of the big picture. The rise and fall of prime ministers, earthquakes and landslides are no more than distant rumours, of surprisingly little interest to the principals; what matters is the here and now. Where did that ballot box come from? How big is the postal vote? Any chance of a recount? When the five seats for Pendle were counted the next day at the leisure centre in Colne, one stop further up the clanking branch line from Nelson, no one was talking about the Tory takeover at County Hall.

Here there was something for everyone: Mohammed Iqbal won, just as Sajid predicted. Azhar Ali took the other Nelson seat even more easily for Labour. Both results were greeted with more effusive male hugs than would be considered seemly in Berkshire. In Pendle Central the Tories knocked out the sitting Lib Dem, but – heroically, in their eyes – one of the Lib Dem candidates grabbed a seat in the rural division.

But the most interesting result came in the most trifling contest: a twinned by-election for two vacancies in Nelson Town Council’s lily-white ward of Marsden, so electors had two votes each. The seats were won by a Conservative married couple, the Pearson-Ashers, who got 426 and 401; the single BNP candidate had 359 votes, with one Labour candidate on 333 and the other on 190. The first of these was called Laura Blackburn; the second Ghulam Ullah. This suggests a good deal of vote-splitting that Labour might find rather unpalatable.

In fact, Marsden already has one far-right relic: Brian Parker, who sits on Pendle Borough Council, is the last survivor in the top two tiers of local government of the BNP mini-surge that took them to 55 council seats across the country by 2009. Of Parker, two opposing councillors told me: “He’s actually a very good ward councillor.”

Curiously, Ukip has made little impact in Nelson or in Pendle as a whole. So there is not much scope for the party to fulfil what appears to be its immediate destiny: as a way station for Labour’s historic core voters to catch their breath on the arduous journey into Theresa May’s arms. According to John the Fish, whose shop functions as a kind of confessional for white opinion, they may no longer need a stopover: “I’m getting plenty of people, staunch Labourites, telling me they can’t stand Corbyn.”

I asked him how many Pakistani regulars he had. He broke off from chopping hake and held up five fingers. On 8 June the fish-eaters of Marsden can be expected to rouse themselves more energetically than the Ramadan fasters across town.

***

Seedhill, the cricket ground graced by Constantine, is pretty Nelson rather than gritty Nelson, even though a chunk of it, including the old pavilion, was lopped off years ago to form an embankment carrying the M65. Upstairs in the pavilion is a wonderful picture of the great man, eyes ablaze, down on one knee for a full-blooded cover-drive. It would have made a better monument in the town centre than the 40-foot weaving shuttle that has dominated Market Street since 2011. I thought it was a torpedo; children think it’s a giant pencil.

The packed houses that watched Constantine lead Nelson to seven league titles in nine years have dwindled now: there were only a couple of dozen to watch his successors play Accrington recently. But it was a drab day with a chilly breeze and Burnley were at home to West Brom in the winter game down the road.

And generally the club thrives better than the town. Given the lack of hotels and pubs, the pavilion is much in demand for functions, and the team remains competitive. Nelson fielded four local Asians for the Accrington match, which suggests that, in one activity at least, integration is just about where it should be.

It seems unlikely that a similar situation would apply at the crown green bowls or the brass band, or any other of the long-standing recreations in Nelson (though small but growing numbers of Pakistanis are now taking allotments). The knee-jerk liberal reaction might be that this is somehow the fault of the white Nelsonians. I think this attitude is a grave oversimplification that has done much damage.

In one respect the incomers have re-created the old life of Nelson. In the hugger-mugger stone-built terraces, the neighbourliness, the power of extended families, the external patriarchy and the internal matriarchy, the vibrancy, the sense of communal struggle . . . that is exactly what this cotton town must have been like a century ago. 

This article first appeared in the 18 May 2017 issue of the New Statesman, Age of Lies

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