We read that the Chancellor is being told there is no scope for tax cuts in the budget because debt interest continues to leap upwards.

I do agree the government needs to reduce the deficit and control state debt in future. The best ways to do that are to control public spending better, and to grow the economy faster to increase tax revenues. Tax cuts are essential to a growth strategy. The decision to cut HS 2 is an important first step in controlling public spending. This blog has identified plenty more.

The debt intertest figures being used to terrify the Chancellor are a muddle of three very different things.

There are the payments actually being made in cash on all the past government borrowings. These are going up a bit as a result both of the increase in debt, and the increase in interest rates meaning that when some of the debt matures the replacement borrowings are at higher rate. These are still affordable.

There is the payment being made to the commercial banks for holding reserves at the Bank of England. This is a  new torture for taxpayers introduced as part of the Bank’s ill advised Quantitative Tightening policy familiar to readers of this blog. Money deposited at the Bank by commercial banks as reserves used  not to attract interest, then attracted a reduced amount of interest based on a weighted calculation. The European Central Bank has recently announced they are going back to no payments on required reserves. Why doesn’t the Bank of England resume its old policy to save the taxpayer some money? Interest paid to commercial banks has soared as the Bank has hiked interest rates and passed it all on to them, a direct gift from taxpayers.

Then there is the real killer in the figures, the inflation cost on the indexed part of the debt. Around one quarter of the state debt has been borrowed offering the lenders reimbursement for inflation on the income and capital they are owed. The main capital enhancement is not paid as a  cash sum each year as inflation mounts. At the maturity of the debt which may be 10 or 20 years away then the inflation is added to the sum to be repaid. In practice the state just borrows the extra sum as it rolls over the debt. It is wrong to treat this as an annual cost affecting the running deficit as the current accounts do. This gives alarming figures for debt interest when inflation is high. In June debt interest was said to be £13.6bn but £9.3bn of this was inflation provisions where no cash was paid out.

The row over what kind of car led to the Luton car park fire reveals a deep divide over what cars people want to buy and which they think are good. I have  not posted items from people who claim the car was an EV or was a diesel as clearly this is an important contested fact. Some assumed it was an EV, some countered it was a diesel and some now say  it was a hybrid with a lithium ion battery. Let us have the truth from some independent authority.

The reason for the row is of course the fact that the establishment wants people to love electric cars, whilst many people do not want one for all sorts of reasons. They are looking for any more bad news to try to put the establishment off its huge support for EVs. If cars with lithium ion batteries do self immolate more often than petrol or diesel then that would be a big negative. Bringing down a whole new car park is not a good look. We must be thankful no one died in the fire. There are worries about newsworthy vehicle fires and about the difficulty in putting out a battery fire, and issues over how common these disasters are.

The underlying problem is the insistence of net zero governments that we should buy or accept products we do not want because we think they are dearer, less convenient, not so fit for purpose. Indeed in one case government wants us to accept a product, the smart meter, which is offered free. We all of course are paying heavily for this through our tax and energy bills. Despite the free offer, years on half of us refuse one. Huge money and effort is being expended on trying to get us to take one. They will not take No for an answer. They should  try instead to understand the wide disagreement with these products and produce better ones we do want.

Too many people see EVs as dear, with too limited a range posing big problems to recharge. The refusal of government to say how lost petrol tax will be replaced is also a major worry. Too many people think heat pumps are far too expensive even after a subsidy, and worry they would be dear to run and let us down on temperature on cold days. Smart meters are thought to be a change designed to overcharge or switch off power if supplies become too irregular.

The green revolution needs to take consumers with it to make faster progress. That will require improved products and services that people can afford.

Much has been written and spoken about Labour this week as they met for Conference. I will today give one of my rare critiques of the leading Opposition party’s policy approach.

It is difficult to square their analysis which wrongly claims public services  have been starved of money in recent years, with their proposal that there should be an iron discipline against more spending, taxing and borrowing save for a very few limited changes paid for by VAT on school fees, and an extra tax on Non Doms. They ignore the £350 bn increase in annual cash spending this Parliament so far, an increase well above inflation. They ignore the collapse of public sector productivity.

Were they to win office they would soon be subject to many spending pressures from the public sector Unions and some of their own MPs to tear up the iron rules and go for a higher taxing, higher spending, higher borrowing model. They have no ideas for getting productivity back to even 2019 levels. Their attack on waste centres on getting back more of the wrong claims on covid relief monies,  where the present government’s policy is to maximise the repayments. Labour would be using the same officials to pursue the same policy. Savings on private planes will be tiny in a £1.1 trillion budget and many Ministers will doubtless still be flying around the world in expensive seats on commercial flights.

Their views on migration favour making faster decisions on applications,. The danger is they will allow or encourage flagging many more people through. The safest and quickest thing to do for the official is to say Yes. This avoids criticism from the applicant and legal challenge and means they could rush the weighing of the evidence or skimp the need for proper documentation seeing the Ministerial imperative to get a fast time for processing. Putting on  more safe routes of entry and speeding consideration could be similar to offering an amnesty to all who are here in the queue, and is closer to having open borders. The wish to do a deal with the EU to try to get more co-operation from France would come at the cost of accepting more migrants from the EU. The EU  are keen to spread the large numbers coming across their southern and eastern frontiers through as many states as possible.

The policy of wanting to force through more planning permissions to build homes and new towns whatever the local view of the desirability and feasibility of this policy is at least consistent with a migration policy likely to boost numbers of newcomers. The housing shortage is partly the result of up to 600,000 additional people coming to the UK and needing homes in a single year, when the homes build rate has neve been anywhere big enough to cope with such arrival  numbers on top of domestic demand.  The planning policy is not a good idea. Communities have been asked to take a lot of  new homes in many parts of the country, and have seen homes built before the extra roads, hospitals, schools, utility provision has been completed. It is also very difficult to hit CO 2 targets for reduction if the country invites in many more people and  needs to build many more homes for them, as this is bound to increase the CO 2 output substantially.

Pauline Jorgensen is doing a great job as Leader of the Opposition on Wokingham Borough and is also the prospective Conservative candidate for the new Parliamentary seat of Woodley and Earley.

She keeps people informed and keeps in touch through her website     paulinejorgensen.uk which residents of Earley and Woodley will find interesting.