Peter Kenyon

Labour unity preserved - 42-days shelved

Labour Party unity has been further consolidated by yesterday evening's announcement by Home Secretary Jacqui Smith to shelve plans to detain terrorist suspects for up to 42-days. I opined a week ago that this could be the first test of new-found unity post-Conference. My suggestion was:

Government can maintain its concern on the record, so that in the event of the need for longer powers of detention emergency legislation can be put before the House.

The Home Secretary told Parliament:

I have prepared a new bill to enable the police and prosecutors to do their work – should the worst happen, should a terrorist plot overtake us and threaten our current investigatory capabilities. Some may take the security of Britain lightly. I don’t. The Counter Terrorism (Temporary Provisions) Bill now stands ready to be introduced if and when the need arises. This would enable the Director of Public Prosecutions to apply to the courts to detain and question a terrorist suspect for up to a maximum of 42 days.

Quite so. Honour all round. Now the banking system has been rescued from systemic failure, it's time to focus on (among other things) reviving the economy, cutting taxes for low and middle-income families, building council houses, buying up abandoned private housing developments and pressing energy companies to pass on wholesale price cuts to retail customers.

Executive pay, reward, failure: Pandora's box

I wonder if our Labour Party Leader Gordon Brown numbers any senior executive remuneration experts among his friends and acquaintances? My immediate reaction to the bank bailout story was to ask on Robert Peston's blog if he could do a sidebar on severance packages for humbled British bankers. This blog has taken an astonishing number of hits since 0800 this morning. Then I spotted Nick Robinson goading the government about other nationalisations. Cheap political points when the global banking system faces systemic failure seem inappropriate in the circumstances. I asked him whether he shouldn't be taking a closer look at senior executive service contracts.

As always in life the devil is in the detail, and this one escaped the box long before anyone anyone could write at all, let alone draft an employment contract.

In his speech at Reuters earlier, Gordon said:

As you would expect the government will protect the taxpayers interests at all times. So as part of this plan we are laying down clear conditions to ensure that the taxpayer gets a fair deal.

· no rewards for failure.
· no cash bonuses this year for the boards of banks receiving public money
· no dividends paid until the government’s preference shares have been fully redeemed

And future remuneration will be based on performance and long-term value creation.

All I would urge, prime minister, is proceed with caution - what you are proposing amounts to the re-writing of every single senior executive service contract currently in operation. I have never come across a single one that didn't make reward for failure pretty much a foregone conclusion. If anyone has a pro forma service contract that avoids such perverse outcomes, please let me know.

42-days: first test of Labour's new found unity?

MPs returned to Westminster today and already rumours are circulating about the 42-day detention provision of the Counter Terrorism Bill. I am not up to speed on the precise timetabling of remaining Parliamentary business. But I am aware this could be the first test of the Labour Party's new found unity. On the one hand there are the stories of Nick Brown's (re-)appointment as Chief Whip threatening tighter control on backbench MPs, on the other is the appointment of Jon Trickett as the PM's PPS. I am presuming Jon will be saying in private: Prime Minister, we need to drop this. (Yes, I know he voted for the provision at 3rd reading in the Commons. But there are lots of MPs who vote for a government policy against their better judgment.)

We have got to focus on the economy. If that wasn't screamingly obvious, a quick look at the FTSE 100 today (down over 5%) is a salutary reminder. We are not going to get the economy moving again wasting political capital on a theoretical possibility that even law officers, the police and the security services can't agree on. Government can maintain its concern on the record, so that in the event of the need for longer powers of detention emergency legilsation can be put before the House. And we can all get on flushing out the next issue that government ministers have set their hearts on without thinking through the political ramifications thoroughly in the context of Labour values.