The MoD is letting a contractor cartel rip Britain off

Defence procurement is a mess. Most new equipment seems to be delivered late, over-budget, and partially defective. So why does the government keep going back to the same failed contractors?

Bad procurement has left big gaps in Britain’s defences. As the Sunday Times revealed yesterday, we have spent billions on drones that can’t fly, ships that can’t sail, and tanks that can’t be transported.

But are the contractors penalised for ripping Britain off?

Quite the reverse. After every fiasco, they get another, bigger contract. No failure goes unrewarded.

This isn’t just incompetence. It’s the result of bad policy.

Every government favours a tiny contractor cartel with operations in Britain. That oligopoly knows it can hold the government to ransom. It’s called producer capture.

The supposed argument for protectionist procurement is that it maintains a strategic industry. But that’s a myth.

Most British defence companies have long since been merged into pan-European conglomerates. Almost no equipment is produced solely in this country.

So when ministers talk about “buying British”, they actually mean buying from across Europe – requiring the permission of half a dozen different governments. So much for industrial sovereignty.

But perhaps even protectionism doesn’t tell the full story.

President Trump is not only the foremost protectionist in the Western world but the loudest supporter of bottomless defence spending – and he leads the country with the world’s biggest defence lobby. Yet even he has called out price gouging by major contractors – and actually got them to cut costs.

It’s depressing that our government can’t summon the courage to do the same.

What is the point of economic forecasts?

The Bank of England has revised up its forecast for the UK economy again. So much for the post-referendum recession they told us would definitely happen. But it does make you wonder: are economic forecasts worth anything at all?

Many pundits seem to treat social sciences as no different from the hard sciences. Economic predictions are reported as facts. But that’s a mistake.

Empirical science is based on testing hypotheses. Experiments are controlled. Variables are isolated.

But a social science, like economics, can’t possibly work that way. There are far too many variables. Instead, broad principles about economic growth are inferred from broadly similar experiences.

Yet economic predictions are based on the premise that those principles can be turned into universal equations. A few assumptions are seen as sufficient to make specific forecasts for future growth rates.

No wonder those forecasts are invariably wrong. How could they not be?

In the last 500 years, human knowledge has expanded enormously. The rate of progress has been extraordinary – so much so that ‘experts’ are often expected to know.

But there are many things we can’t know. It will never be possible to predict the behaviour of millions of people accurately. It’s a conceit to think it could be.

Yet forecasters trade on that conceit. Like oracles in the ancient world, they claim prophetic knowledge that no one else possesses.

Calling out these so-called experts isn’t about dismissing science. It’s about recognising the real limits of knowledge

 

Parliament needs to stop refighting the referendum

Three cheers for TheCityUK! Its latest report anticipates post-Brexit opportunities, instead of rehearsing yesterday’s arguments. If only MPs could do the same.

TheCityUK isn’t the only lobby group to perform a volte face on Brexit. The CBI has too. Project Fear pessimism is gradually being replaced by optimism.

I suspect the lobbyists are now playing catch up with their clients. Public-affairs folk may have bought into George Osborne’s narrative, but businesspeople are pragmatic. Now that Brexit is happening, they’re interested in the potential gains, not the spin.

But that positive attitude still hasn’t spread to all of the House of Commons. In the Article 50 debates, many MPs seemed to be stuck in a pre-referendum time-warp, repeating talking points from the Remain campaign. Many others supported Article 50 through gritted teeth.

That approach is counterproductive. Not just because it doesn’t help the government going into Brexit negotiations. But because a forward-looking Parliament could be remarkably effective.

Taking back control from the EU is a big job for legislators. This Parliament and the next will have more influence on Britain than any has had for decades.

As TheCityUK says, this is a once-in-a-generation chance to shape our future. If only MPs could see it.

Developing nations need trade not aid

Stephen Crosby.

Meanwhile, Shanghai Shenhua is paying Carlos Tevez £615,000 a week. It is estimated that this £3m would pay for meals on wheels for 800,000 elderly people in the UK at a time when the social care budget is suffering from severe cuts. British foreign aid spending is doing nothing to help the economic or political freedoms of people in the countries who receive the cash. One of the most frequent criticisms of foreign aid is how it fuels corruption in the countries that receive it. Money which the UK government markets to the electorate as being destined to help the destitute in the Third World actually ends up creating and supporting bloated and unnecessary bureaucracies in the form of both the developing country’s government and the donor-funded NGOs. The significant burden of debt in less developed countries have often occurred as a result of the foreign aid packages pushed by wealthier countries and pursued by corrupt and greedy politicians and business people in recipient countries. Most people don’t realise that loans are usually embedded n aid packages, either directly or as a condition of foreign aid donations being given in the first place. As aid flows in, citizens of the developing country effectively become helpless as increasingly all their government needs to do to stay in power is to court and cater to foreign donors. Such governments have less of a need to raise taxes, and as long as they pay their army and security they can be relatively relaxed about the views and opinions of their disgruntled people. Foreign aid has largely encouraged Third World governments and their populations to rely on hand-outs instead of on themselves for development. Foreign aid has a tendency to create poverty through economic institutions which block the incentives and opportunities of poor people in order to make things better for themselves, their neighbours and their country. Foreign aid fails to stimulate trade and wealth creation; there should be a focus of foreign assistance to shift from aid to enterprise, from poverty alleviation to wealth creation, from handouts to investments, from seeing the poor as consumers or burdens to seeing them as creators and from encouraging dependency to integrating the poor into networks of productivity and exchange. The popular understanding of international assistance programmes is that they deliver immediate needed disaster relief, or enhance the well-being of people through economic development. Surely we should change the focus of our nation on trade not aid, and the money reserved for Western governments’ foreign aid budgets should be put back into the pocket of the Western taxpayer, thus leaving less developed countries free from the harmful effect of foreign aid and allowing more capital to be accumulated by those in the West who produce goods and services and who are better able to enter into mutually beneficial trading relationships with the Third World. UKIP’s foreign aid policy is very simple; we will ensure that our aid is concentrated on life-saving programmes, inoculation, clean water and emergency disaster relief. Once we are finally free of the EU’s protectionism, which has adversely affected international development, the UK will be better placed to help the world’s poorest people by giving them free access to the British market. We have a foreign aid budget which at the moment is costing the British people £30 million every single day, UKIP believes that this funding should be reduced and that additional money should be put into our NHS, social care and flood prevention within the UK.

Stephen Crosby

Let’s just get on with Brexit

It’s now 224 days since a majority voted Leave on June 23rd. It’s 4,237 days since I first called for Britain to leave the EU in Parliament – in my maiden speech. We’ve talked about Brexit enough. Now it’s time to implement it.

Today Parliament will vote for the first time on beginning the Brexit process. It’s a day that I’ve been waiting for my entire political career.

I know most of my constituents feel the same. Indeed, I’m acutely aware that many are aggrieved that the process hasn’t started already.

With a few notable exceptions, yesterday’s speeches on the Article 50 Bill were striking for their lack of content. There are no new arguments to be made that weren’t put before the people last year.

Instead, the debate centred around process, as the last few MPs set on blocking Brexit came up with ever more sophistic excuses for ignoring the decision of the electorate.

But the grandstanding is just for show. Continuity Remainers don’t seem to be prepared to force the issue – and settle it in a general election. Their delaying tactics serve no purpose whatsoever.

So let’s just get on with it. Brexit is about restoring Parliament’s legislative sovereignty, after all. MPs should be jumping at the chance.