On Friday I did an interview with Mark Dolan on GB News in which I discussed the Northern Ireland Protocol, tackling illegal cross channel immigration and growing the economy – particularly on ways to assist small businesses and the self-employed.

You can find my interview below between 17:20 and 29:30 minutes in.

It looks as if some at the heart of government thought a trade agreement over red and green lanes would be sufficient to fix Northern Ireland and EU issues. It seems that the meeting with Unionists pointed out to the Prime  Minister that the application of EU law in Northern Ireland was the bigger matter where the EU had  not made the changes required.  Under the Protocol itself parties are meant to give priority to the Good Friday Agreement which needs  the consent of both communities to any changes . The Unionist community does not agree to the EU approach to the Protocol and to lawmaking for NI.  As a result the Prime Minister doubled down on his words that there was still no Agreement to publish. He required his negotiators to return to the EU to sort out the issue of law making and enforcement in NI.

The Protocol was meant to be a temporary or holding arrangement. The EU needs to reconsider it position on these matters to assist in restoring  Stormont and the tradition of working through the agreement of both communities.

One of the main arguments ahead of the budget is the one about what changes you get in revenue if you put tax rates up and if you cut tax rates. This is especially important and hotly contested over business taxes. UK corporation tax revenues increased as George Osborne cut rates. The Republic of Ireland collects proportionately much more tax from business by having a much lower rate than us and attracting many large businesses to locate more in the Republic. Indeed, in 2022 Ireland collected  24.4% of its total tax revenues from corporation tax with a 12.5% rate. The UK only managed 9% of tax revenues with a 19% rate.

There are also studies showing that if tax free shopping is allowed for visiting foreigners the UK will collect more tax overall, as it will boost  taxation on shop profits and shop employee incomes and on the hotels and other facilities the visitors use. UK revenues have been very sensitive to overall economic growth rates. rising more than official forecasts when times are improving, and producing less revenue than expected when growth falls away.

I noticed in the recent Sunday Times survey of economic forecast outturns the official OBR performed relatively badly in the table for 2022, reminding us how difficult it is for Chancellors to  make  the right policy  judgements when the supporting forecasts can be well off.

Angered by the cost of living squeeze and sky high energy prices, many people are  now hostile to the whole idea of company profits. It is encouraging them to demand ever higher windfall taxes to confiscate more or less the whole profit, and leads on to demands for  nationalisation. It is perhaps time to remind ourselves what profit making enterprises have achieved to raise our living standards, to provide well paid jobs and drive growth. It is also time to ask why countries like Venezuela that went the whole way in nationalising and imposing price controls ended up in poverty with large shortages. Many Venezuelans  are fleeing the country to live somewhere where profits are allowed and  living standards are higher.

The UK’s own experience with  nationalisation was poor. A nationalised steel industry put in five large integrated plants but could never sell enough of the steel given their cost levels and spent the  next two decades arguing over how many people to sack and how many plants to close. The nationalised railway had a poor record on safety, punctuality and service. It sacked many staff as its market share of the travel market plunged downwards. It lost a fortune for taxpayers who had to pay the bills. A nationalised phone company fell years behind the USA where competing private sector companies leapt ahead with better service and newer technology.  In the UK  there was little choice of phone, long waits to get a line and rationing including having to share a line with the neighbour for many customers. The electricity industry relied on coal power stations when cleaner and more efficient gas was available. The industry leapt ahead driving costs and emissions down by putting in combined cycle gas plants as soon as it was privatised. The coal industry was in long term decline, with bitter disputes about job losses and mine closures.

Wherever price controls have been tried investment falls and supply reduces. This makes the problem worse. Rent controls seem like a great and popular idea, but as rent controls come in so people withdraw properties from rental and shelve plans to build more. This usually makes the property shortage worse and results in higher rents in the medium term than if controls had not been introduced.

The combination of double corporation tax, a planned rise in the rate of business tax by 31%, and windfall taxes that will be imposed for several years whether there are windfalls or not is putting companies off investing in UK oil and gas production. These taxes will not only mean we import more and become ever more dependent on high and volatile world prices, they will also mean we collect less revenue in future. We will lose out on taxing good cashflows from oil and  gas fields under UK control, and watch as we pay high taxes to foreign governments to import their energy instead.

Profits are used to pay for investments in extra supply, which in turn sustains more and better paid jobs. No profits, means no investments. Fewer investments means lower living standards.

Facts4eu have published an updated version of my analysis of the Protocol issues on www.facts4eu.org/news/2023 feb redwood on independence.