Poor management and under-investment - what's wrong with UK businesses

Foreign-owned businesses in the UK are at least 50% more productive than British owned ones. The issues home-grown businesses struggle with are low productivity, poor management and under-investment.

If we leave the EU then our own businesses are going to have to up their game, both to fill the gaps left as the foreign-owned businesses shut up shop here, and in order to compete on the world market.

What do they need to do?

Skills

Two-thirds of employers say they are suffering a skills shortage, but even so only 40% intend to recruit more skilled staff - the lowest since the first survey in 2013. 43% of young workers (18 to 34-year olds) believe that career opportunities in high-skill areas will be better overseas post-Brexit. - almost half of those are considering moving abroad to chase such jobs.

Productivity and investment

The UK's low productivity means it takes us a week to produce what our neighbours make in four days. Automation and training are the solution to the productivity gap, but investment would be needed - and isn't happening. The imminent prospect of Brexit under a weak leader, undermined by a split party, is discouraging companies from making any firm plans. It is far safer to simply employ more unskilled staff who can be shed when Brexit happens and times become harder.

The lack of investment is most obvious in manufacturing where total capital assets have fallen by £30 billion since 2012 - a 10% reduction. When compared with staffing levels this is a fall of 4% per employee. Other sectors have increased their total assets, but as they have also increased staffing they too show a reduction in investment per employee. This is not due to reduced profitability, which has remained at around 12% since 2010 and increased to 15.3% this year, instead the firms are sitting on cash piles waiting to see what happens in a few months' time.

Businesses aren't even investing their cash in other assets or stocks. Asset and share prices are so high now that they don't offer good returns, and there is also the concern that there will be a serious slump after Brexit, with asset values tumbling.

Keeping cash instead of putting it into productive investments means that the firms are not making money from it, in fact with interest rates so low the cash is losing value every year.

Overseas investors

So why are asset prices so high? Simply because interest rates all around the world are low, so overseas investors are looking for places to put their money. The large drop in sterling's value since the referendum has made UK investments look very cheap when bought in dollars or yen. This has also allowed foreign buyers to snap up assets such as property - almost all (94%) of London property sold in the last quarter was bought by overseas investors.

However, business investment in the UK by overseas companies has dropped by 9% - and far more in some industries. For example, the car industry is very exposed to Brexit risks (mainly tariffs). Investment there has dropped from £2.5 billion to around £0.7 million.

This is the wrong way round - we shouldn't be selling up our assets in some sort of national fire sale. Instead, we should be pulling in overseas investment, increasing the value of UK businesses and their profits, which will in turn increase the value of our own shares in them, the tax paid by them, the wages paid to their employees and the knock-on economic boost to their local area.

How do we convince investors that they should invest?

We need to have a coordinated business policy. This requires us to sort out Brexit right now. It would be best to stay in the single market (as Leave promised) but even a clear decision to jump off the cliff edge together with intelligent policies to deal with the fallout would be better than the current fog.

We cannot afford to lose the confidence of investors just when we are putting barriers up between ourselves and the largest market in the world.

Soft power, hard power and Brexit

Britain is home to four of the world's largest law firms. Our legal industry earns £25 billion a year - £5 billion from overseas. A lot of the business is done with Europe - British lawyers can represent clients in EU courts and interpret EU laws. However after Brexit they may lose this privilege. Clients may also disappear - a lot of the work (44%) is related to financial services. If we lose 'passporting rights' then a proportion of this will disappear.

With the drop in business and restrictions on overseas students meaning fewer studying English law, our 'soft power' will be reduced.

Furthermore, as one of the largest economies in the EU we had a lot of influence over policy, and the EU is the largest economy in the world. That has let us leverage our influence very effectively, granting us much greater hard (military and economic) and soft power than we will have once we are out.

Already our growth is falling behind that of the world's leading economies. We are now in the 'second tier', ranked with Japan and Italy, and by next year the IMF predict we will be the bottom of the league with growth of 1.5% against the US/Eurozone's 2.5%. As a consequence, this year we have already fallen from being ranked as the fifth largest world economy to the seventh.

Economists blame high inflation, weak investment and poor productivity. All caused or aggravated by the uncertainty around Brexit.

Worse, we are squabbling amongst ourselves. In England the two leading parties are both deeply divided. Mrs May is briefed against by her own cabinet ministers and appears unable to hold any 'red line' at all. Her government is hostage to a small NI party with very different interests from hers. In Scotland there is still a prospect of another independence referendum: The Scottish parliament has overwhelmingly voted against the EU Withdrawal Bill due to concerns about a Westminster power grab - the bill grants complete control of certain areas to Westminster, not even granting a veto to Holyrood. Even sentiment in Northern Ireland is swaying towards a union with the south as the border issue remains unresolved - crashing out of the EU will be hardest by far on Northern Ireland.

We are still a nuclear power (though Mr Corbyn will change that if he ever can), we still attract overseas investment (though it has already fallen 9% since the Brexit referendum), we have some of the best fintech in the world (though those firms are being tempted to relocate to the Continent as Brexit nears).

What we lack is a decisive leader, backed by her party, with clear objectives aimed at improving UK productivity, attracting more foreign investment, and encouraging innovation and investment in our own companies. Someone who will at the same time ensure that the wealth generated is shared around rather than captured by the richest 1%.

Once Brexit is settled, however it is, our political parties need to put the current divisions behind them and find that leader.

Free trade and the USA

Where are those trade deals we were promised? According to the Brexit cheerleaders we would have a queue forming at our national door, hoping to strike an agreement with us. The EU would be first - Mr Davis said it would be the easiest deal ever done. Then the USA, followed by everyone else. The gold at the end of the Brexit rainbow was increased trade and reduced immigration.

So they were wrong - but worse, the reality for trade post-Brexit is the opposite of what they promised us (and we still don't know what is going to happen about immigration).

The president of the European Council, Mr Tusk, has said "Ireland first" - before talks can progress the Irish border arrangements must be sorted out. The EU won't accept a hard border between North and South as part of the deal. It isn't even a ploy - clearly we can't make any real progress in trade arrangements when we don't even know how the land border between the UK and EU will operate.

OK, so maybe while we scratch our heads about Ireland we can at least suck up to the US. We have already invited the President over, and gave him the royal treatment. Maybe we should appoint Mr Farage as our US ambassador.

If only Mr "America First" Trump could be so easily won over. Mr Trump is not a big fan of free trade. We have already had to fight protectionist tariffs of 292% (yes, two hundred and ninety-two percent - turning a £10 component into a £40 one) that he wanted to put on aircraft imports, threatening the future of at least one large factory in Northern Ireland. Mrs May repeatedly pleaded with him to reconsider but he ignored her. Fortunately for us his own US International Trade Commission ruled the tariffs to be illegal.

Now he has imposed punitive duties on imported steel. We export around 15% of our steel to the US, exports worth £360 million. Mrs May has again appealed to him to reconsider but he has simply responded that if we retaliate then he will put tariffs on cars too.

Government analysis shows that around half of the trade benefits of leaving the EU would have come from a US-UK deal. A deal that is looking more and more remote by the day.

Fortunately, the Brextremists are nothing but adaptable. As they haven't put any real thought into how to turn any of their promises about 'sunlit uplands' into actual deals it is simple enough for them to change the words while singing the same tune. A leading Brexiteer minister, Mr Raab, is now saying, "The real opportunities for the future will be those emerging markets", though he is careful to avoid stating exactly which countries we should target.

Let's hope those opportunities really exist, as all the Brexiteer economic hype and promises depend upon them. Let us hope, as the US and China gear up for a trade war, that those countries don't say "Me First" too.

Would Mr Davis make a good PM?

When he first took on the role of Brexit secretary David Davis promised a great EU deal by March last year followed by the signing of equally advantageous trade deals with countries around the world.

Maybe he believed his promises. He has difficulty in telling his wishes from reality, which makes him a poor boss and a poor negotiator, as the following observations about him show:

• "hates to listen to advice"
• "delusions of grandeur"
• "vain and quixotic"
• "all noise and bluster"
• "He has no practical sense of the realities [of Brexit]."
• "He is not interested in evidence when it doesn't suit him."
• "All the evidence of economic benefits that he uses to justify new trade deals is the same evidence that he dismisses when it comes to the effects of leaving the EU."
• "He doesn't know the dossiers well. His style is arrogant. He is full of bluster."

These are comments from people who worked with him, but he himself said (about being the Brexit secretary): "What's the requirement of my job? I don't have to be very clever. I don't have to know that much."

We can also see his incompetence writ large in his actions.

This was the chief negotiator who arrived at the negotiations without briefing papers, who would only turn up to the start and end of the talks until his counterpart opposite (Mr Barnier) complained that the UK were not taking negotiations seriously.

He is the leader of the negotiating team that achieved nothing in initial talks until Mrs May flew in and introduced some realism to British demands.

He is also the government minister who claimed that we had detailed analyses of the effect of Brexit on 58 economic sectors, and when he was forced to release them denied that they had any economic analysis. Not all that surprising given that he said, "I don't actually believe economic forecasts."

When Mrs May managed to concoct an Irish border fudge that satisfied the interests of all opposed parties, Mr Davis announced the next day that it was only a "statement of intent" and not legally enforceable. Unsurprisingly, his statement torpedoed that trust-based arrangement and meant that the EU negotiators now require legally enforceable commitments.

He has recently stated that a face-off with Brussels and a no-deal Brexit is better than Mrs May's deal, and a further 10% drop in the value of the pound would be a good thing, even though it will mean higher living costs for us.

Now this clown wants to be prime minister.

Why we need a transitional deal

The leaked government analysis of Brexit is sobering. In particular it challenges the buccaneering claims of the Brexiteer lobby, showing that free trade deals will only add around 1% to UK economic growth. This is in the long-term, and using the most positive assumptions.

Overall, growth will be 5% less than what was projected pre-Brexit, with the north hit particularly badly, slowing by up to 11%. Government borrowing will increase by up to £120bn, and large industrial sectors such as cars and chemicals will slow down by up to 12% ,while costs will go up by  up to 20%.

The Leavers' will be happy at least to hear that EU immigration may fall by up to 90,000. The report doesn't say anything about Brits fleeing abroad.

All the analysis above depends upon applying a rosy tint to our glasses - it assumes the US will not become more protectionist; that we will make advantageous trade deals with the biggest global players; and that we will continue to benefit from the trade deals we currently have via the EU and any it strikes in the near future.

High-profile Brexiteers such as Mr Rees-Mogg say the conclusions are wrong as the report does not consider the extreme Brexit they favour: dropping as many tariffs and safety regulations as necessary to encourage imports. What they omit to mention is that - according to the originator of the strategy - this would mean entire industries collapsing with massive social disruption. Not that Mr Rees-Mogg would actually notice, of course.

Meanwhile the drop in the pound - now only worth $1.27 - hasn't given us the export boost we were promised. Our current account deficit is up another £7 billion to £27 billion (Germany has a surplus of £250 billion). A large part of this is due to more expensive imports and a failure to export more. The trade deficit is now at £8.8 billion - up by nearly £2 billion.

Right now we are a full member of the EU, the largest market in the world, with no trade barriers slowing trade, no tariffs to put up prices, and yet we still have not managed to cash in. In three months we will be leaving. Let us hope that Mrs May manages to get that transitional deal, and that we use the extra time more effectively than we used the last couple of years.

Tariffs and trade deals

How will Trump's steel tariffs affect us?

The Bank of England is worried. It isn't the tariffs themselves, it is their effect on the trade policies of other nations. They point out: "A major increase in protectionism worldwide could [increase] global inflation."

This is exactly what we don't need with Brexit uncertainty already hitting UK growth.

Meanwhile we still don't have those 'roll-over' trade deals that Mr Davis promised. Currently, as part of the EU, we have free-trade deals with 70 countries outside the EU. Not one of them has yet agreed to continue trading with us on the same terms as at present. Mr Davis's letter explaining why we are leaving the customs union didn't even mention free trade, instead talking about  a wish to "build deeper links" and "tap into fast-growing markets".

In fact, in March next year those 70 countries can terminate our current agreements despite the transitional deal. The EU has suggested that they wait until the transitional period finishes in 2020, but it isn't up to the EU. Clearly we might need to make some concessions to help persuade them to agree to 'roll-over' the agreements.

Given that we will be desperate, expect some hard-nosed negotiations, especially around immigration. For example, India wants 12,000 UK visas a year - something we denied them in 2010 and refused again this year. The EU itself is already angling for a special deal for EU businesses. Do we sacrifice control of immigration to economic necessity?

This is happening just as our merry band of trade negotiators are meant to be scouring the rest of world for deals (so far with a complete lack of success - so admittedly things can't actually get worse). We are leaving the sheltered waters of a frictionless customs union to battle our way through the stormy seas of cut-throat international trade, being forced into unpalatable concessions to ensure our economic survival.

Make no mistake, no-deal will be brutal for many employees, and the Devil take the hindmost. We could end up returning to Victorian values with Mr Rees-Mogg at the helm, tearing up rules and regulations, with industrial barons exploiting the workers, industrial safety a fading memory, and widespread poverty.

No doubt we will weather this, as we have far more serious crises. I just would prefer not to have to live through it myself. This has been inflicted on us by the self-interest of a small band of politicians and business people exploiting the serious discontent of a minority - a numerous minority, but still a minority. 17 million voted Leave, out of an electorate of 47 million, and a UK population of 67 million. Yet this is called "the will of the people"? No wonder the Brexit club don't want another referendum.

No-deal contingency plans

The EU makes up 15% of the world's total imports/exports. It is the top exporter of commercial services and the second biggest for merchandise. Only China beats the EU in merchandise, no one else even comes close.

Britain has the seventh largest economy in the world (we were fifth before the Brexit-effect started kicking in). This is reliant on being a big exporter. We sit right next to the rest of the EU, the largest market on the planet, so it is hardly surprising that half our exports go to the EU27.

This make a no-deal Brexit a bit of a concern. The EU27 have published their plans - and they don't seem to have based them on Brexiteer promises ("easiest trade deal ever", "they need us more than we need them", "we can do sector deals with each country separately", etc, etc), unsurprisingly the plans are designed to protect the EU27's vital interests.

Under the EU27 plans we would not be allowed to make 'mini-deals' with individual countries; British airlines could only over-fly EU27 countries - no landing, thank you - and airlines majority owned in Britain will count for this, so Iberia and Aer Lingus will be under the hammer; full border checks will be required - so ports will be overwhelmed (expect the motorway lorry parks to be operating); firms providing financial services in the EU27 will need to set up a branch in one of the EU27 member countries; other financial services (e.g. Euro-clearing) will have to move completely to the EU27; road haulage firms will be under threat of having to apply for new licences for their trucks under the international quota system - it is estimated that firms could lose up to 95% of their current licences.

The government is making emergency plans - drug stockpiles and rationing, the army on standby, motorways ready to be turned into lorry-parks.

Some UK firms are also making plans. FreestyleXtreme is an online business which makes 60% of its sales in the EU27. It has a turnover of £17 million and is featured as a case study on the Department of International Trade's website. So how will Brexit affect them?

Actually, the company is firing most of its staff and relocating to Germany, having already spent hundreds of thousands of pounds preparing for Brexit.

The Federation of Small Businesses says only one in six of our small businesses have even started planning for Brexit. Given that our own government has no idea what is going to happen in a few weeks' time, can you blame them?

If you want to make deals you have to accept rules

Manufacturing output in the UK is dropping while our trade deficit is growing (£1.9 billion and counting). For example, Jaguar Land Rover has started moving more production to Slovakia. Manufacturing only makes up a fifth of the UK economy, but where is the promised export-led recovery? Right now we are at the bottom of the international growth league, with the Eurozone comfortably ahead of us. Worse - we are only ranked 60th out of 136 countries for openness to trade.

UK construction activity also fell by 2% in the same period. Overall UK growth is at its weakest for 70 years and is expected to remain in the doldrums for some years.

So why was manufacturing expected to expand with Brexit? Ironically it was based on our weak economy. The crash in the value of the pound (and its expected continued fall) makes our exported goods much cheaper than they were, while the growth in the Eurozone means people in our biggest export markets have more money to spend (last year 49% of our exports went to the EU).

However, to increase exports we need to go out and sell to new markets. This isn't happening. Instead the fall in manufacturing output is matched by falling investment. Both are due to the uncertainty about what deal we will strike with the EU. Manufacturers and exporters are holding back until they know what is going to happen. Why chase new customers when no-one knows what rules will apply next year?

We still don't know what trade deal we will have, with departure only weeks away. Will we still have access to our largest and closest market? If we tumble out of the single market and end up trading under WTO rules then our exports will suffer under large tariffs. Worse, if we refuse to keep regulatory alignment with the EU, our biggest trading partner, then we won't even be able to sell into the market at all.

The irony is that Brexit hard-liners talk up trade, but don't seem to understand it. They want the bare minimum of WTO rules and a regulatory bonfire. They have yet to understand (as Mrs May has already admitted) to trade with other nations it is not enough to strike down our own rules to allow imports, we also need to accept their rules so we can export to them. Remove regulations and we can import more cheaply, but it would actually reduce our exports.

For example, some of our most successful - and lucrative - exports are services not manufactured goods, in particular we are internationally famous for financial services. Shoddy financial services can have a serious impact on people's lives, so they are heavily regulated. If we are to sell overseas we need to ensure that our companies adhere to overseas rules.

Exiting the EU, we need to choose whether to become rule-takers or not. We can be deal-makers either way.. However, rule-takers can make bigger deals.

Why is Russia destabilising Europe?

The Russian military exercises earlier this year were notable for a number of reasons. First, the Russian invasions of Georgia and the Ukraine were both preceded by military exercises in the nearby area. This time Russia ran the exercises near the Baltic states. A heavy hint to them not to get in trouble with Russia.

Second, under international agreements any exercise involving more than 13,000 personnel must have international observers. Each exercise did stay under this figure but neighbouring exercises were run in parallel, adhering to the letter but not the spirit of the agreement. This allowed Russia to practise large-scale war-making without giving away their tactics.

Third, the Russians demonstrated that their forces are more effective than analysts expected, having modernised thoroughly both in equipment and command capability. This indicates that stopping them would require more force than previously assumed or planned for. The head of German foreign intelligence advised that western governments need to increase their military spending to keep up. The former UK head of Joint Forces Command says the British Army is 20 years behind Russia and would not survive a Russian assault.

Fourth, the Russians have helped install a pro-Russia US president and they have supported European breakaway movements such as the Brexit referendum and Catalonia's referendum, helping them financially and by providing propaganda on social media and conventional media.

Mr Putin's intent is clear - destabilise Russia's neighbours, sow discord, break up alliances, encourage factionalism and extremism, so that they pose no threat to Russia, and if Russia did decide to grab a bit more lebensraum then there would be no coordinated response.

That said, even with nuclear weapons backing up their troops, it is unlikely that Russia wants to invade Europe. Afghanistan was an object lesson and Iraq another. It is one thing to invade, it is quite a different thing to hold the ground. The Crimea has a Russian speaking majority so there is a lot of popular support there for the annexation. Poland would be a different story.

Why does Putin want to destabilise his neighbours? Essentially it is fear of change.

The Ukraine was about to sign an economic agreement with the EU. Its president, under pressure from Russia, rejected the agreement and signed one with Russia instead - which led him to be thrown out by the electorate. After this setback, Putin decided that if bribes didn't work then force would - Putin's money, propaganda and undercover troops between them fomented a civil war in the Crimea (which sits on the Russian border and has many ethnic Russians) giving him an excuse to annex the area - saying that he was protecting the Russians living there.

Russia once wielded immense power over most of eastern Europe. After the break up of the USSR Putin watched former satellite states won over to Western economic and political models. Russia itself was experimenting with a version of democracy and capitalism (though the oligarchs managed to commandeer and corrupt it). Putin was working for the KGB in East Germany when its government collapsed and reunification started - he saw how quickly the Communist system could be destroyed. In 2005 he said the collapse of the Soviet Union was the "greatest geopolitical catastrophe of the Twentieth Century... Moreover, the epidemic of disintegration infected Russia itself."

Once Putin was in power he made it his mission to ensure that the Russian state would not suffer the same fate. His first task was to deal with Chechnya, a strategically important satellite state which had fought for and achieved independence from Russia in 1997. In 1999 Putin started a new war which ended with Chechnya capitulating and once more giving up their independence.

Then he moved on to the oligarchs, first making a 'grand bargain' with them, allowing them to maintain their power-bases as long as they supported him. Once he had them under his thumb he started to pick them off one by one. He started with the richest, Mikhail Khodorkovsky, president of the Yukos oil and gas company. Putin arrested Khodorkovsky and nationalised Yukos. He then moved on to  Boris Berezovsky (owner of the TV network Channel One - seized and nationalised - who fled to Britain and was later found hanged in an apparent suicide) and Vladimir Gusinsky (imprisoned until he agreed to sell his media empire to the state). The remaining oligarchs decided it was best to support Putin unquestioningly.

Having secured Russia internally, Putin is now trying to maintain a buffer between itself and the West. Russia is still very weak economically, so his destabilisation strategy makes a lot of sense. It is relatively cheap, and eminently deniable.

Does this mean we shouldn't worry about Putin? Is he just an annoyance rather than a threat? The problem is that he sees us as a threat, and may not understand where to stop, even ignoring the fact that true Communists see the simple existence of democracy as an existential threat.

Russia under Putin is similar to the Branch Davidsons compound that was at Waco, arming themselves up for fear of what is around them, with a belief system seeing themselves as persecuted, at risk, with unbelievers all around them, their own members escaping, and a leader who is using these beliefs to make himself unassailable. Waco was a disaster - but at least they didn't have nuclear weapons.

Rust belt

The American mid-west is known as the 'rust belt'. Free trade meant that Chinese imports (in particular) undercut the products of industries in the mid-west, causing them to fail. Chinese imports explain 40% of the decline in American manufacturing. US manufacturers reduced wages to compete - every $1 million worth of imports in their sector leading to them imposing a wage bill reduction of $500,000. A third of all manufacturing jobs were lost.

Death rates went up sharply - mainly due to increases in suicide and drug/alcohol poisoning - social problems increased, living standards plummeted.

On the other hand, consumers all through the USA benefited from lower prices, allowing them to have a higher standard of living without any increase in their wages.

So free trade is good for many people, but there will always be some losers. Allowing free trade means allowing other countries to undercut your own industries. This is where the benefits - and the costs - actually come from. The benefits are from cheaper goods, meaning higher living standards for the general population, the costs are to the people who worked in the local industries that are now uncompetitive.

North Americans on average have one of the highest standards of living in the world. The US also has one of the highest levels of inequality in the developed world.

Cutting our regulatory ties with the EU would give us the chance to emulate the US. The Brextremists say they want to leave so they can cut tariffs and promote free trade. The don't mention that this will mean redundancies and poverty for workers in the exposed sectors. The irony is that Leave supporters will be hit harder on average than the Remain voters when jobs disappear.

Furthermore, this is the best-case scenario, and how free trade is intended to work (trading countries specialise in what they are best at and trade for the rest). Whether we can achieve that is another question.

We are dumping a free-trade agreement with one of the biggest economies in the world, one that is right on our doorstep, and aim to replace it with piecemeal agreements with smaller and more distant countries.

Our most lucrative exports are of financial services, and the process of the UK drawing more and more such business from the EU followed the free trade formula perfectly. Without Brexit we would have continued using our leverage to crack open the services market further.

Maybe we can somehow continue to capitalise on our expertise if we lose single market access, however many sectors are going to suffer, many people are going to suffer. Mr Hammond and Mrs May are right to try to keep our access for as long as is possible.

Brexit and farm subsidies

As Brexit comes closer a lot of people who voted Leave are starting to consider the consequences. For example pro-Brexit Cornwall wants to keep its EU subsidies and Grimsby wants to be forgiven  import duties.

However, with UK growth being downgraded once more, and our Chancellor being forced to borrow even more money just to pay current bills, it seems unlikely that there will be any money available for feather-bedding.

One group that are likely to suffer across the country are farmers. Currently the EU pays landowners according to how much land they own. Clearly this is great for the richest landowners. For example, the billionaire Brexiteer Sir James Dyson received £1.6 million last year. In total, UK farmers receive subsidies of £3.1 billion a year.

Mr Gove, the environment secretary, says that he won't be continuing the current policy, but it isn't clear what he can change. The problem with cutting subsidies is that, although subsidies to small farms are much smaller than to big farms, such farms depend upon them far more heavily. One possibility is means-testing, a sort of social security for farms.

Mr Gove anyway is not too fussed about farming, he is into 'soil health' rather than producing food. That may be why he isn't concerned about the crops that had to be left rotting in fields due to the lack of seasonal workers. Given that the UK is already a big food importer and that prices are going up due to the weak pound, giving up on growing food ourselves seems an odd policy.

The Scottish are far more canny, with targeted support and special grants. This is why they (and the Welsh) want control over their own farming policies - something they should have anyway under the devolution settlement - rather than having Mr Gove telling them what to do.

.Mr Gove is a conviction politician, and - as his stint as education secretary showed - this means that he believes his way is the only right way. He implements policies without consent, without even consultation or discussion (he is the source of the quote about Britain having had enough of experts). UK farming is facing a serious challenge in Brexit, and once we leave Mr Gove will be in sole charge.

Farming is in for an interesting time.

Who is going to do the heavy work post-Brexit?

In the past five years only one Briton applied for work as a fruit picker at Tuesley Farm. The pickers start at 7am and work 8 or 9 hours, for £8.50 - £9.50 per hour. They have one day off a week. The Brit lasted a day before deciding the work was too hard and that the other pickers worked too fast.

The number of seasonal agricultural workers coming over to British farms each year has dropped by 17%, and we haven't even left the EU. If the threatened immigration controls come in then a crisis will become a disaster. 70% of Tuesley Farm workers come from Romania, Poland and Bulgaria.

Farmers could manage if that was the only issue. Pay more, expect less: It would mean prices would go up, but if it means keeping out foreigners then surely Brexit supporters would willingly pay.

If only it were that simple. We already have full employment, so any workers attracted to picking will be leaving other jobs unfilled. Meanwhile the Brexiteers justify leaving the EU by talking up free trade. However free trade will mean British farmers being priced out of the market by cheap imports - they won't be able to afford to pay pickers more. Boris Johnson may want to have his cake and eat it, but its ingredients won't be grown in Britain.

Mr Gauke, the justice secretary, has suggested one possible solution - letting criminals out of prison to do work in construction, catering and agriculture. Quite how they would be managed is hard to imagine - in the USA 'chain-gang' prisoners are literally chained together and their guards carry heavy rifles. We barely have enough prison officers as it is, and they don't carry weapons. Maybe Mr Gauke is thinking of asking convicted gang bosses to keep an eye on things? Interestingly, Mr Gauke says that it is inevitable that the prisoners will commit more crimes while on release - it is not clear that their prospective employers would be similarly relaxed about this.

This brilliant idea is possibly even worse than the clever wheeze Ms Leadsom borrowed from revolutionary China.

No wonder the owner of Tuesley Farm now regrets voting for Brexit.

Deregulation

To maintain the trade that we currently have we need to re-establish 750 agreements, ones which can't just be rolled over. Non-tariff barriers will also increase post-Brexit (unless we stay under the ECJ umbrella and become an EU rule-taker).

Our chief trade negotiator, Mr Falconer, is very keen to scrap current regulations in order to improve our chances of making deals post-Brexit. Mr Falconer is Special Trade Commissioner for the Brextremist Legatum Institute and wants a hard Brexit.

A no deal with the EU means he can put current UK regulations 'on the table' in any trade negotiations. An example would be to allow the import of chlorinated chicken, hormone-treated beef and GM (genetically modified) foods from the USA. EU regulations do not allow these to be sold in the EU. However, if we wish to trade with the US they will want to sell us these products.

Leaving the EU completely would allow us to alter food regulations. It looks like an easy win. We get a trade deal and we get cheaper food.

Of course, if our own farming industry wished to compete then farmers will need to use the same methods to reduce costs. If they do so, however, then they will no longer be able to export their products to the EU. So UK producers will have to make a choice - sell to the EU or sell to the UK.

It would be possible for some farmers focus on one market and others to concentrate on different markets. Australia already facilitates both - they track beef to ensure that hormone-treated meat isn't exported to countries where it is banned.

If we do that then we will need all the compliance machinery in place - inspectors, product tracking and dispute resolution, and we need it as soon as possible.

Clearly it is vital therefore that the government is talking to businesses, finding out what would suit them best and what problems they predict. The US, for example, produces an annual 500-page document on barriers US businesses face when exporting.

We don't. In fact UK businesses complain that the government isn't communicating at all. Information on government plans for Brexit can only be accessed by senior officials using highly secure 'Rosa terminals'. Their juniors ask business representatives questions. They even seem to listen, but nothing come back. Of course, the evidence is that there are no plans to communicate.

Even worse, the government hasn't yet talked to all those small businesses which export only to the EU. Businesses that have never yet had to fill in a customs declaration. Nor have officials explained to larger firms how they are going to be supported. One freight firm will have to fill in half a million extra declarations each year, requiring them to find an extra 100 staff, just when everyone else also wants more staff to fill in custom forms.

Mr Barnier wants to know what model we favour. If only we knew, Mr Barnier.

The problem with freedom

The siren song of the Brexiteer lobby is freedom - freedom to make trading agreements, freedom to control immigration, freedom to decide imports tariffs.

The problem with giving people freedom is that most normal people don't want too much of it. Anarchy is the epitome of freedom, but when politicians want to boost their ratings they don't say they will disband the police and close the prisons, they do the opposite - they promise more law and order - less freedom.

That is why the term 'red tape' is so useful when someone wants to deregulate a market. Red tape just means 'laws and regulations', and 'reducing red tape' means getting rid of laws and regulations. Of course, when someone uses the term 'red tape' what they are talking about are "laws and regulations that hinder me or my business and I want rid of". They call them 'red tape' to imply is that they are unnecessary bureaucracy.

They hope that by saying 'red tape' people won't even think to ask why the laws were made in the first place, and will instead assume the laws really are unnecessary.

So what laws do the Brexiteers want to be shot of? And what are the likely effects?

Tariffs
While we are in the EU we have to charge non-EU importers a fixed tariff on their imports. Outside the EU we can choose what to charge, if anything.

Reducing tariffs on imported goods that we also produce ourselves would lower prices in the shops by at most 1%. It would also mean our industries would have to reduce their own trade prices to compete, so people would have to work harder, work longer or work for less money. Any government that caused that would be out on their ear.

Of course, ewe could just drop tariffs on goods we don't produce - netting less than half a percent drop in overall prices. However once we have done that then we don't have anything to offer when we want other countries to reduce tariffs on goods we are exporting to them.

Keeping tariffs, on the other hand, means we will need to police all imports to ensure importers pay the correct duty. Currently EU goods just sail through customs, as there are no tariffs on them. Once we leave the EU we will have to check them, including those crossing the Irish border. That means more customs infrastructure and staff - the financial and political costs of all that has yet to be worked out (we still don't know how the Irish border will work, even now, with 14 weeks to go). Our exports to the EU will also need to be checked at the EU border - the total cost to our exporters will be £29 billion a year.

The only real power of tariffs is in keeping out imports, as President Trump is attempting. The 'free trade' Tory Brexit-brains don't want to do that, the irony is that their socialist nightmare, Mr Corbyn, would love to be able to do that - and the Brexit-inspired chaos in the Tories may give him the chance to have a go.

So, rather hard to see the benefit of controlling tariffs (unless you want a re-run of the protectionist stagflation of the 1970s).

Trade deals
In the EU we have only the trade deals that the EU has negotiated. Outside the EU we can make any deal we want.

Sounds great! However, another way of putting it is:

In the EU we have every trade deal that the EU has negotiated using all the leverage of being one of the biggest economies on the planet, without us having to do a thing. We also have free and frictionless trade with the whole of the EU - one of the biggest economies on the planet (as just noted) - customs-free and tariff-free. Outside the EU we will have to negotiate every single deal separately ourselves, starting from scratch (and with a protectionist in the White House, and having mightily annoyed one of the biggest economies on the planet - see above).

Oh, dear.

Immigrants
In the EU we have to allow free movement of EU citizens. Outside the EU we can choose exactly who can come in.

Now this is a clear win... Well, you would think so. Isn't it?

The Leave campaign credit their anti-immigration campaign with tipping the balance of votes their way. Leave-voting friends and relatives of mine say controlling immigration is a key benefit, and not for racist reasons either (they quickly added). One said it will prevent Syrian terrorists from coming here (honestly, he did), another said it will reduce the demands on social services in some areas.

On the other hand, a lot of our economy depends upon immigrants. The NHS is an obvious example, as is farming. A lot of other sectors are also now asking to be given special treatment - from fish canneries to advertising firms. Not to mention education - overseas students are a big earner for the UK, but Mrs May insists on counting them as immigrants that need to have numbers cut..

The government's record is not reassuring either. Even ignoring the civil service's incompetence - exposed by Windrush and evident in many smaller but equally nasty incidents before that - immigration won't be managed any better than before. With the economic hit of Brexit we won't be able to afford to step up enforcement.

Mrs May never managed to reduce immigration in her time at the Home Office despite creating the 'hostile environment' policy. She counted students into her totals, despite being advised not to, and still couldn't bring down the numbers. Ms Rudd couldn't even manage to stay in post, let alone reduce immigration.

Blue passports

Actually, we could have had EU passports in blue (or any other colour) if we chose

Sovereignty

Yes - we will have lots of that. Sorry, I'm just not very excited about it. Albania had total sovereignty. The USSR had total sovereignty. We can isolate ourselves or we can follow international rules.

With the Brextremists wanting shot of the Court of Human Rights, I am not convinced that giving all the power to our rulers and removing any oversight is really such a wise idea.

As Mr Lee said when he resigned his ministerial post, "I could not look my children in the face in 20 years' time and try to explain why I did nothing when I knew that this government was taking the wrong course and sacrificing important principles of parliamentary sovereignty and human rights in the process."

That - and for the sake of Great Britain and her people - is why I am still fighting against Brexit.

Do we want a socialist society?

When will the hard-line Brextremists in the Tory party start to wake up to reality? Their incompetent plotting to  replace Mrs May with their self-interested selves has achieved nothing except to further weaken her and the Conservatives, just at the moment we need strong leadership.

We desperately need a trade deal with the EU. The Brexiteer windbags have demonstrated how difficult it is to make trade deals. Their entire platform was based on trade and immigration, yet since the referendum they haven't even managed to make deals with countries we already trade with. If they can't get current partners to agree to 'roll over' existing deals, how are they going to manage to make new deals? Send Boris "Gaffmeister" Johnson in?

It isn't only the Brexit negotiations that should worry them. Their constant undermining of their party leader, Mrs May, is a gift to the opposition. If they stampede her into an unplanned Brexit with no trade deals and the sudden imposition of tariffs on trade then the electorate will punish them, and we could end up with Mr Corbyn as PM.

I have voted  Labour in the past, and hope to do so in the future, but right now the Labour party is in the hands of extremists and disconnected with reality as the Brexiteer chorus line. The shadow chancellor, Mr McDonnell, has stated,"I want a socialist society", and says that to do that he must overthrow capitalism. I have seen the effects of too many revolutions to vote for his. In particular, his support for the socialism experiment in Venezuela is deeply worrying.

More worrying still is that his views are echoed by the Labour shadow home secretary, Mrs Abbot, their strategist, Mr Milne, who said Venezuela held “lessons to anyone interested in social justice and new forms of socialist politics”, and of course Mr Corbyn himself.

What lessons are to be drawn from Venezuela? There are many: fixing the price of basic goods (such as bread) leads to shortages; printing money leads to inflation (expected to hit 13,000% this year);

However the most important lesson is Mr McDonnell's reaction to the disaster that is Venezuela. He now says, "I think in Venezuela they took a wrong turn, a not particularly effective path, not a socialist path."

In other words, Venezuela was a socialist state when socialist policies were being implemented, but once things went off the rails it was no longer socialist - even though the same policies were still in place.

Of course, if only they had taken the right path all would have been fine. So what was the right path? Mr McDonnell again: "All the objectives of Chavez […] would have been successful if they had mobilised the oil resources to actually invest in the long term".

In other words, keep throwing money at it. Maybe that really would have made it all work. In the UK we have a minimum wage and social security, and some (democratic capitalist) countries are experimenting with a universal basic income. Money can certainly make or break policies.

Which is why I don't want Labour to take control after a disastrous Brexit. Our economy will be damaged - possibly badly damaged - and the one thing we won't have is any spare money.

I am a socialist who is aware of history. Together with Venezuela, other socialist states have been the Soviet Union, Cuba, China, Yugoslavia, Vietnam, Tanzania and Nicaragua. Not one of them is a place I would rush to live in or wish to copy.

The art of the deal - trade and Brexit

The promise of Brexit was that when we left the EU we could make trade deals with other countries. Currently have a free trade deal with one of the largest markets in the world and trade deals with 60 or so other countries - all of which we will lose when we leave the EU. So how we are likely to fare if we do cut ourselves loose, can we do better?

Before you make a deal you have to ensure your own side is in agreement on what is wanted and what is on offer.

Yet Mrs May failed to do that. She fronted up to the Irish border negotiations promising the DUP was happy with the talks so far. Which they promptly denied, and she had to halt talks to go back and negotiate with them before she could return to the EU negotiators.

When you make a deal you need to know that what you are getting is worth having.

The fabled 'sector analyses' turned out to be no such thing - and we only know that because the government were forced to publish the documents. We still has no idea what the real consequences of Brexit are going to be - with it only a few weeks away.

A deal is a promise and relies on trust and honesty. You are expected to do what was agreed - to keep your word. What you don't do, especially if you are actually in charge of the negotiations, is make a public repudiation of the agreement your side has just signed.

Mr Davis (the Brexit secretary - referring to the Irish border agreement): "This was a statement of intent more than anything else. It was much more a statement of intent than it was a legally enforceable thing.”

Mr Gove (environment secretary): “If the British people dislike the arrangement that we have negotiated with the EU, the agreement will allow a future government to diverge.”

The message is clear: if we decide we don't like some agreement we will simply change it - and you just try to sue us, Sunny Jim. Hardly a surprise if the EU aren't interested in giving us wriggle room on the backstop.

Ineptitude and farce. We need competent negotiators, but who do we have?

We have Mr Davis, who was in charge of our side in the negotiations and who over six months only spent four hours talking to his opposite number. This is the negotiator who turned up without his homework on the first day. Mr Davis doesn't even understand what EU members can offer. He said we would be able to strike a unilateral deal on cars with Germany - apparently not realising that we are leaving so we can make such deals, but Germany will still be in the EU...

He said we would start trade negotiations around the world on September 9th 2016 and two years later we still haven't started. He even said we would have a 'Canada-type' deal ready to sign as soon as we have officially left the EU. That option isn't even mentioned now.

We haven't negotiated our own trade deals for 44 years and even so Mrs May has felt constrained to use Brextremists to head up negotiations - politicians full of empty promises and no ideas. Vote Leave ran on a platform of reducing immigration and sovereignty. The campaign's cake-ian economics promised EU+, keeping our free trade with Europe and adding more deals for ourselves. Reality didn't come into it.

Why should they care? Crashing out of the EU and defaulting to WTO rules is a preferred option for many of them.

They should care because this unprofessional and insincere approach to the negotiations will make post-Brexit trade deals far harder to secure. Those fabled global trade deals they promised us would await us in the sunny uplands of Brexit can only happen if we can negotiate effectively.

The jokers we have clearly can't.

Farage should donate his pension to the Treasury

People are taking fewer sickies, dragging themselves in to work fearing that otherwise they will lose their jobs.

Inflation is at 3% but pay remains flat. Food costs have gone up 4%, forcing people's spending on non-essentials to drop by 3.8%.

Rough sleeper numbers increased by 15% last year - despite the government talking about halving it by 2022 (only three years away). Britain has around 18,000 homeless, with half of those sleeping in some sort of shelter (such as a car) and the rest sleeping rough.

Millions of people are not able to save enough for a comfortable retirement, while the official pension keeps being pushed up and up, meaning many will have to keep working into their 70s or retire in poverty.

At least Mr Farage is alright, Jack. He is all set to take his EU pension of £73,000.

His pension is part of our financial agreement with the EU - a large chunk of our Leave payment will be to cover pensions such as his. Given that Mr Farage says the settlement is too big (what we will pay to the EU - not what they are paying him), it would be a nice gesture if he donated his EU pension to the Treasury in order to bring down the cost slightly.

Daily Mail warns of the financial cost of Brexit

The owner of the Daily Mail has warned that profits will be down by almost ten percent this year due to falling circulation and Brexit. The company explained that economic risks had been increased due to Brexit, so companies are not buying adverts.

The Daily Mail saying that Brexit is bad for the economy?! Wonders will never cease.

This may explain why the previous editor, Paul Dacre - a virulently doctrinaire Brexiteer - has been replaced by Geordie Greig, who seems more aware of the damage Brexit has already caused and what a disaster 'no deal' would be.

An example of the economic risks is seen in the UK car industry, which employs over 850,000 people and relies on free movement of goods between the UK and the rest of the EU. Industry investment has already fallen from £2.5 billion to £1.1 billion, and production is also falling, in contrast to previous industry predictions of continued growth. Car-makers explain that they are holding back investment until the uncertainty around Brexit is sorted out.

Jaguar Land Rover - our biggest carmaker - is reassessing its manufacturing plans. It has recently bought a new car factory in Slovakia while its electric vehicles will now be produced in Austria. Most of its British-made vehicles have diesel engines - diesel sales have dropped 30% since the recent attacks on diesel's environmental safety record. Jaguar is also holding off on deciding whether to build electric cars here - the chief executive says the decision awaits clarity on the Brexit deal. He added, "You hardly see inward investment anymore."

His comment was echoed by the chief executive of PSA (owners of Vauxhall and Citroen) who said, the company "cannot invest in a world of uncertainty", while Ford (12,000 UK employees) is considering stock-piling vehicles before next year in anticipation of customs delays and large import duties.

Nissan, Toyota and Honda are all big employers in our car industry, with a total of 142,000 UK employees. The Japanese ambassador recently warned Mrs May that they would require tariff-free access to European markets post-Brexit, otherwise the companies would have to relocate: "If there is no profitability ... no private company can continue operations."

When such a large industry has such concerns about Brexit, even the Daily Mail has to take notice.

Funding for social care - the care home crisis

Care home fees are rising faster than ever, and are now standing at an average of £33,000 a year nationally - 10% up on last year. Prices in London and the south-east average £40,000. The average pension is £14,522.

The rise is driven by many factors:

• more people are living for longer creating greater demand
• physically disabled people and people with learning disabilities - people in their 30s and 40s - are also taking up places, as councils find that cheaper than providing sheltered housing
• care home staff costs are going up 
• councils are cutting what they will pay, meaning private payers have to pay even more to subsidise the council-funded residents.

Despite this rise in demand and in fees, care homes are closing because they can't make money. 

How is this possible? Essentially it is the difference between fixed costs and marginal costs. A care home needs enough residents to cover the costs it will have even if no-one is resident (e.g. maintenance, heating, rates, basic staffing). Once you have enough residents to cover those costs then every extra resident is a bonus

Of course, each resident still does cost money - food, nursing care, laundry, and so on. So once your fixed costs are covered an extra resident doesn't mean an extra £40,000 in profit, it might only mean an extra £10,000.

This is the standard way to make these businesses work, and it is why losing only a few residents can quickly lead to serious problems.Why doesn't it work in care homes? The difficulty is that the councils pay fees below the cost of care, so the council-funded residents actually cost the care homes money. The difference comes from private payers - their fees subsidise the council-funded residents.

This seems odd, but it can make sense to take council-funded residents. If you want private payers then you need somewhere for potential customers to visit - no-one buys expensive care for their nearest and dearest 'off plan'. People want to see what the home is like, meet the staff and test the atmosphere. So when you set up a home you start with guaranteed council-funded residents, budgeting for a loss in the first few years and then slowly draw in the real money.

Previously this worked, as care homes could attract enough private payers to cross-subsidise the rest. But as prices rise and incomes stall, fewer and fewer people can afford to pay privately, so the number of private payers is reducing and the subsidy isn't there.

It  is no use taking in more council-funded residents - the fees don't cover the costs. You can go upmarket and focus entirely on private payers - or go under. So homes close and elderly people become 'bed-blockers' in their local hospital because there is nowhere else for them to go - and a hospital bed costs a lot more than a care home place.

The market failure here is in who pays the costs. A person in a hospital bed is paid for by the NHS - i.e. from national funds, the care home has to be paid for by the local council. Given how stretched they already are, it is no wonder that they don't want to take on the costs of care. In poor areas councils have even less money and a lot more pensioners who can't pay for their own care, so those councils can't even afford to pay.

One possibility is for the NHS to pay for the care home places - they already pick up the tab for any specialist care needed by residents. However, this would be resisted by local councils as it would mean their funding being cut even further.

The fact is that something does need to be done, and done soon. Mr Hunt, the health secretary, has managed to lever an extra £20 billion for the NHS this year from Mrs May, though she has not said where the money is coming from. His next target is social care, which needs at least another £10 billion this year - rising to £20 billion by 2030. Doing nothing is what Mrs May is best at, but this issue is at the heart of a fair and caring society. She does believe in that, this is her chance to show it.

Is there a doctor in the house?

Probably not - you would be lucky to find a nurse.

Currently there are 38,000 NHS staff vacancies. There is a hard limit on issuing visas for non-EU skilled professionals, currently set at 20,700 a year. Last year 2,360 doctors were refused entry because until this month the limit included health workers.

It isn't just that we are preventing people coming. European nurses are fleeing the UK as Brexit looms. In the last year 3,962 left and only 805 arrived. In 2015-16, before the referendum, 9,389 EU nurses came. That's a downswing of 12,000 - Mrs May should be happy, as that must make a reasonable dent in the immigration figures.

So are we replacing disappearing healthcare professionals with home-grown staff? No. Last year 21,931 UK nurses started while 25,400 left the profession. So not only have we lost over 3,000 EU nurses we have also lost 3,500 UK nurses. That is a total of 6,500 nurses lost in the last year alone.

A third of all the nurses who are still working are also thinking of leaving the profession - often because the growing lack of staff means increasing pressure on those remaining. This pressure can lead to serious personal consequences for them and their patients. For example, Dr Bawa-Garba was struck off for mistakes that led to the death of a patient - she was still being trained and yet was left in sole charge of  an emergency department and acute Children’s Assessment Unit. There was not a single consultant available. The nurse monitoring the boy was given a two-year suspended jail sentence for manslaughter on the grounds of gross negligence; Dr Bawa-Garba was struck off the medical register - out of a job and barred from her chosen profession.

The recent government-led Windrush pogrom won't have helped either.

The British Nationality Act was passed in 1948 and gave British citizenship to all people living in Commonwealth countries. The government wanted people to help rebuild Britain after the war. People came with young children, settled, worked, contributed to their local and wider communities.

In 2010 the UK Border Agency, under Mrs May, destroyed their registration slips - the evidence that they had arrived legally. Then in 2014, as part of her 'hostile environment' policy for immigrants, Mrs May passed a bill allowing the government to take away people's citizenship. These two steps allowed her to begin deporting the Windrush generation, since they could no longer prove they were in the UK legally.

Mrs Rudd took the fall for that nasty stitch-up, leaving its originator, Mrs May, still in charge. Astonishingly, the home secretary, Mr Javid, has persuaded Mrs May to allow more doctors and nurses to come here by issuing more visas. It is amazing she agreed - it isn't just the numbers of visas for staff, they will bring their families too - however the concession is temporary.

Whether enough doctors and nurses will actually apply is the next question: Come to Britain - until we don't need you any more, and just hope you don't get kicked out, sent to prison or ruined.

You may be best advised to learn some First Aid. I did a course last week, so I'm OK.

Agreements depend upon trust

Imagine you were Mrs Merkel. You are trying desperately to hold together a coalition of political parties in your own country while providing leadership to an equally wobbly coalition of European neighbours.

To your east you have a powerful country run by a kleptocratic elite which has interfered in the politics of some of the biggest global nations, which has invaded a neighbour and which has been running war games on your borders.

To your south you have a continent largely in the hands of corrupt and incompetent politicians or mired in war, leading tens of thousands of people to migrate towards your more stable lands. However your own people don't want them to come in.

Meanwhile some members of the European coalition have serious structural economic problems and nationalist parties are becoming popular.

A contributing member nation of the coalition has decided to jump ship, taking its contributions with it, after repeated concessions made to it (for example a rebate on its contributions and the option of not joining an 'ever closer union').

That nation has a government which is split into two factions vying for supremacy and has had to buy in support from a fringe party in order to stay in power. Populism, nationalism and even anti-democratic threats (such as demonising judges for upholding the law) are the common currency of the anti-EU media and politicians. The politician leading that nation's exit negotiation team is a member of that anti-EU group, a group that want to "have their cake and eat it", that talk about going into competition with their former allies. Many of the group are even Cabinet members - and the prime minister is captive to them.

You need to decide how to manage the exit, causing as little damage as possible. Would you give up all the goodies they demand and hope to sort out the hard things later? Would you even believe the promises of such a government?

If you look at Brexit from the EU's point of view it is no wonder they want to leave the trade deal till everything else is sorted.

The pound in your pocket

The pound is slipping again. Inflation is above 3% for the first time in six years. Mrs May looks weaker and more unstable by the day. Two cabinet ministers recently resigned within days of each other. Inflation is still high, affecting food prices in particular.

GDP fell by 0.1% per capita this year. Mortgage approvals are down, investment is down. Is this the new normal, or just a blip? What is the outlook over the next few years?

Growth forecasts are being revised upwards for most rich countries - including the euro zone. Meanwhile UK growth has been revised downwards again, creeping up to only 1.3% in 2020. Even more of a concern is that even that 1.3% assumes that we will continue to have high levels of immigration and will remain in the single market. Neither seems likely right now.

So we need to tighten our belts. Consumer spending is at its lowest in five years, with a third of people expecting their finances to worsen. Five million households will be paying another £5 a month for their energy, as Ofgem raises the price cap by 5.5%. More and more families with at least one working member are now living in poverty - 8 million people at the last count. Put another way, that is 57% of all Britons who are living in poverty.

Austerity also means havinng to accept a shorter lifespan: Austerity kills people. 120,000 more people than expected died between 2010 and 2017 due to NHS cuts.

Mrs May hasn't fulfilled her promises to help the 'just about managing' (JAMs), instead they are quickly becoming the 'not quite managing' (TOAST). Instead of fighting the 'burning injustices' she has speechified about, she is making them worse. Her board of social mobility commissioners have recently resigned en masse - every member - because all they hear from the government is rhetoric and they see no action being taken.

We still don't know how leaving the EU will affect the economy in detail, even after the government was forced to release its studies. After much dragging of feet Mr Davis finally released them - admitting that his department had spent three weeks blacking out all "market and negotiation-sensitive information".

Studies by pro-Brexit economists assume other countries will give us everything we want and that extreme policies can be imposed in the UK without a parliamentary approval. It is telling that their favoured model is authoritarian Singapore.

The only reasonable predictions we have say the economy is going to suffer a long-term loss of growth no matter how leaving is managed, while the IMF expect the pound to drop another 15% if we don't sort the details out pronto, with the pound likely to fall to parity with the euro.

The good news is that the EU no longer worry that we will slash taxes and regulations in an attempt to win trade.

We can't afford to.

Policing immigration

Overall there are now 2.29 million EU citizens working here, and 1.25 million from other countries.

Net immigration has dropped to 230,000 - down 106,000 from the previous year. Most of this fall (82,000) was due to more EU citizens departing than coming over - 123,000 EU citizens decided to leave while only 230,000 arrived, mostly due to the declining value of the pound and the uncertainty around Brexit.

This reduction in arrivals is very good news for our Border Force, which can't even cope with our non-EU visitors. A recent inspection report said, "We are alarmed about the impact that inadequate resources are having on Border Force. This is a system which has not functioned properly for years, in large part due to insufficient staffing."

The number of full-time staff has been reduced year on year. Border Force now relies upon partly-trained seasonal staff at Gatwick and Stansted airports. The Irish border is policed by a total of 57 officers, who have to cover four sea ports, three airports and the land border. If a hard border is created then who is going to police it?

Meanwhile Mrs May is insisting on not one but two separate systems for registering EU citizens - one for the ones already here, and one for any new arrivals. She wants the new, parallel systems to be up and running by March next year. Oh, and the Home Office also needs to create a post-transition immigration system - its details haven't even been specified yet.

The Home Office has said that work on this new system has barely begun and it will almost certainly not be ready in time. They already have their hands full with preparing for a tripling of visa applications once free movement is banned. Last year they issued 164,000 visas to non-EU citizens. Once EU citizens need visas then the Home Office will have 400,000 to deal with each year.

Looks like the NHS won't have a chance at the £350 million the Brexiteers promised.

What are we rushing into?

What are we rushing into? Does Mrs May know?

Security
We have been paying the French £62 million a year to provide security at Calais. The Home Office has now agreed to increase the payments by tens of millions of pounds. We are also negotiating a new contract for Channel Tunnel security - the likely cost is £80 million a year.

These agreements allow British police to work in Calais, preventing illegal immigrants from even travelling to the UK, so overall they should still give us a net saving. Mr Macron has considered scrapping the deal but is willing to continue with it if Britain pays more.

Medicine
The European Medicines Agency has left London for Amsterdam, the European Banking Authority has gone to Paris. That's over 1,000 highly-paid jobs gone already - and we have to pay for moving them, including £500 million to sort out a botched rental contract. Not only that, we need to sort out our replacement for the agency - or do we just accept EU regulation?

Finance
The UK deals with 90% of all clearing of euro-denominated derivatives. European regulators want to in-house this once the UK leaves the EU. Frankfurt's Eurex is their alternative. The European Central Bank has already tried this once in 2015 but EU judges stopped them. Post-Brexit all the European Commission need do is make clearing houses legally obliged to reside in the EU.

Frankfurt has managed this once before - in the 1990s they took over managing German bond futures from London.

Regulated financial companies can't wait any longer to find out what will happen in a few months time. Over half are starting to put their contingency 'no deal' plans into action. This will mean up to 10,000 jobs moving abroad.

Advertising
The UK exported £5.8 billion worth of advertising services in 2016 making it a magnet for overseas talent, which in turn drives more exports. This positive feedback will be lost unless we remain open to talented workers settling here. And it isn't just advertising - all export-heavy industries compete on the world stage and need top talent to do this.

Industry Investment
Unilever has announced it is upping sticks completely - it is moving its legal home to Holland after nearly 90 years. Other companies are holding off on investment in the UK - and it is the most successful that are the most pessimistic. Without investment the UK's productivity - already woefully low - will keep falling, which will mean wages will be squeezed.

Exports
The UK has around 70,000 small companies which export only to the EU. They have never had to deal with customs forms or delays. If we end up under WTO rules (as Brextremists want) then customs red tape will cost £27 billion a year. Even a customs union will impose costs of £17 billion a year. The companies' best strategy is to improve their productivity so as to cover the increased cost. Employees will have to make more if they want to keep their jobs, but there won't be any pay rises.

* * *

We can deal with these issues. It won't be easy and we will be poorer, at least for a while. However if we are going to make it long-term then it is vital that the government gets its act together, decides what Brexit will actually look like and then prepares the UK properly for it.

Mrs May's Fear of Commitment

Mrs May has laid out what she wants from Brexit. She has demanded that the agreement with the EU meets five requirements - respecting the referendum; protect jobs and security; be consistent with our values; not weaken Britain's ties; and be durable.

All sensible goals, but it is hard to see how to satisfy all them strictly.

Leaving 'just a little bit' would make things comparatively easy, if the Brextremists would face reality. A faint hope.

A hard Brexit would certainly be durable, but even the Brexit believers agree that jobs will be lost, and let's not get started about the Irish border.

Mrs May also said, "I want the broadest and deepest possible agreement - covering more sectors and co-operating more fully than any Free Trade Agreement anywhere in the world today."

She then contradicted herself by dropping her offer of a "binding commitment" to follow EU rules. The Brextremists watered it down to making "strong commitments".

So the believers in 'cake' are still calling the tune, leading Mrs May to a Brexit that can never satisfy her stated requirements.

Mrs May is a little dog being pulled along on her lead, straining against it but unable to resist. When asked recently if leaving the EU would be worth it for the UK her answer was: "the British people voted for Brexit".

She knows we will be worse off economically, she knows that any new deal would be worse than our current one, she knows that we will have to keep paying into the EU but will have no influence.

Even our shiny new blue passports are going to be printed in France.

Potholes

One thing I remember vividly from a visit to Chicago some years ago was the awful state of the main highway that followed the shoreline of Lake Michigan. I thought to myself that in the UK we would never let a city road fall into such disrepair, leaving it so full of potholes.

Soon it will be US visitors who will despair at the state of British roads. Right now local roads need £9.3 billion to bring them up to scratch. The number of times the RAC has been called out for vehicle damage due to potholes increased by 11% last year, with 3,565 call-outs in just three months. With the government budgeting just £1.2bn a year towards maintenance things are set to get far worse - as the condition of a road surface worsens the damage builds up faster. Local councils need an extra £0.5bn just to keep things deteriorating further.

And things are deteriorating. 12% of local roads (a total of 24,500 miles) need essential maintenance before the end of this year. 20% will reach the end of their life in the next five years - up from 17% in 2017, and 12% in 2016. On average local roads are only resurfaced every 78 years.

Councils filled 2.7 million potholes in 2015 - last year it was only 1.5 million. Often now they will only repair potholes which are at least 4cm deep. In Bury the council has changed even that rule and only promise to 'investigate' potholes which are 4cm deep or more.

Just last month a cycle race with 550 entrants was cancelled - the organisers decided the risk of injuries due to potholes was just too high.

Roads are a very visible sign of the state of a country. Before EU funding helped Ireland to kick start its economy you would instantly know when you crossed the border from Ulster to Eire. A well-maintained road would suddenly became a crumbling pastiche of potholes. If you visit Bulgaria now you will find that the main roads are kept in good repair, but the B-roads look as though someone told an enthusiastic army of treasure hunters that there was gold under them. Driving on them is only possible at a crawl - and you still risk a puncture or worse.

How long before the UK road network is reduced to the same state?

Saving the pennies

A basic expectation in rich countries is law and order. Yet the UK is cutting police funding every year.

The Bedfordshire police force are so up against it that they are asking to be spared further cuts. They have already made cuts of £35 million and are expected to cut another £12.5 million. Suggestions about how to do this include not investigating thefts from cars as the car will be insured - it's your own fault as you shouldn't be leaving things on view. Another possibility is only bothering to investigate shoplifting of goods worth at least £100.

Another basic service developed countries offer is health care - even the USA has a public health service.

Yet our health service, like our police, is being starved of funds. Again, there are some bright ideas. One that is being tried is to pay host families to put up patients in their spare room. At £50 a night there have been a lot of applicants, and it would certainly save a chunk of cash for the NHS. The company, CareRooms, says the hosts will be trained, though it is unclear exactly what they will be trained to do or how post-operative complications will be managed.

What about local services?

Northamptonshire county council has had to ban all new expenditure. The council will continue to fund any current contracts but otherwise they will only fund services they are legally required to provide. No council has had to do this in the last twenty years, and yet already there are warning signs that at least four more councils are in danger of following Northamptonshire into the morass:

• Surrey - £100 million shortfall
• Lancashire - £97 million shortfall
• Somerset - £15 million overspend this year, following overspends in the previous two years (it is now closing two thirds of its children's centres)
• Norfolk - has overspent its budget for the past three years

In fact, in the next three years an entire tenth of all councils are at risk of running out of money. The government has cut funding in half in the last eight years, meanwhile the number of people needing care keeps going up - 14% in the past six years. Social care now takes 55% of council spending (it was 45% in 2011). Note that that means the actual money being spent is going down - which explains why social care is in such a parlous state.

It is tempting to poke fun at the cost-saving ideas above, but councils are currently cutting services everywhere they can - reduced bin collections, reduced food safety checks, reduced services for the young, bus subsidies cut by 50%, 10% of libraries closed, housing budgets halved (leading to homeless households increasing by 34%). It will only get worse - the government is slashing funding by another £5 billion next year.

Of course, we really do need to sort out Britain's finances. Mr Hammond's target is a balanced budget and he has now achieved it three years ahead of schedule. With the Brexit effect already chilling economic activity in the UK, and worse to come, we are not going to have a lot of spare cash to throw around.

However, while the government tells councils to pinch pennies they themselves squander millions of pounds on poorly costed infrastructure projects. Projects like HS2 and the Hinckley Point nuclear power station. Meanwhile homes, roads, social care, the NHS and the police are cut savagely.

Mrs May is like a householder who puts down parquet in the best room but scorns to mend the holes in the roof.

Is democracy working?

"Is democracy working?" asked Mr McDonnell. Clearly he doesn't think so. He continued: "It didn't work if you were a family living on the 20th floor of Grenfell Tower."

Mr McDonnell is a Marxist. His touchstones are: "the fundamental Marxist writers of Marx, Lenin and Trotsky". He openly states that membership of the Labour Party is a tactic to help him to gain political power and thus allow him to subvert the establishment and give the proletariat control. He regards this ('the dictatorship of the proletariat') as 'real democracy'.

Fittingly, it was a democratic plebiscite which focused on sovereignty that may well give him his chance. Ironically it was the arch-capitalists of the Conservative party that backed Leave, even though it was always Labour that was the most suspicious of a European superstate.

Post-referendum Conservative party membership has fallen below 100,000 - and the remaining rump has an average age of 70. In the Lower House the government is riven by discord, the party divisions over Europe deepened by Brexit and the unappetising choices we face, ministers openly briefing against their own leader as well as each other.

Meanwhile the left wing of the Labour party is tightening its grip, deselecting centrist candidates and enforcing strict party discipline with the aim of presenting a strong and united front at the next general election.

Is the prospect of street-level democracy so bad? Haven't we had enough of elites and market forces, rising house prices and zero-hours contracts? Why vote for party candidates when we can vote directly on the policies that affect us? Why have rich, out-of-touch bosses when we can have workers' collectives deciding on strategies that benefit the whole factory workforce rather than just the shareholders' interests?

If you don't actually think that having capital is in your future, what's the point of anything in a capitalist society?

Some will point to all the failures of Marxism to fulfil its promises when actually attempted. The states either collapse into anarchy or end as a dictatorship - and not a dictatorship of the proletariat either. China has been comparatively successful economically, but it isn't the classless, stateless society Marx was aiming for. The Chinese state directs industry far more than do governments in capitalist economies. Furthermore, the country is run by a unelected elite headed by a man who cannot be removed democratically, even by his own minions.

It may be that it isn't Marxism's fault. After all, Marx stated that the first step "is to raise the proletariat to the position of ruling class, to win the battle for democracy". In countries such as the UK, which have strong democratic institutions, this could be achieved without revolution. Violent revolutions may allow dictators not the people to take control. The revolutions and dictators last century were mostly funded by the Commie-phobic USA, but with Mr Trump and the Russian state in charge they may stop interfering in foreign affairs.

Should we join Mr McDonnell on the barricades? When I consider conditions even in peaceful Marxist countries (such as China and Cuba) - the economic conditions, social conditions and political conditions - and compare them with what we have here... it seems pretty obvious why their citizens flee those countries to settle here rather than vice versa.

So let some other nation have a run at it first. If it works for them then I will be happy to form an industrial collective and march into our communist future. Until then I will do my best to frustrate Mr McDonnell's plans.

Carillion's collapse - who's fault was it really?

Carillion has been put into compulsory liquidation, leaving debts of over £1 billion and a pensions deficit of £1 billion. 20,000 people may lose their jobs directly, and tens of thousands will be put at risk indirectly as suppliers write off millions of pounds.

How did the darling of PFI, with millions of pounds of government projects on the books, fail so spectacularly? The select committee who took evidence call the directors "a series of delusional characters maintain[ing] that everything was hunky dory until it all went suddenly and unforeseeably wrong." They said, "Everything we have seen points the fingers...to the people who built a giant company on sand in a desperate dash for cash."

The directors must have known something was up. Until last year their bonuses could be clawed back - in 2017 they changed the rules to make that almost impossible. They also stopped paying into the company pension fund. This was the year that they and the auditors, KPMG, signed off the company with a clean bill of health, despite knowing of £180 million in unpaid bills and that £1.57 billion of the companies total assets was 'goodwill'. Astonishingly, even though Enron took its auditors with it (Arthur Andersen, one of the 'big five' global accountancy firms), KPMG (one of the four now left) seem to have learned nothing - they are now being investigated.

How could this collapse happen? In part it is due to the government's obsession with PFI. When large contracts are put out to tender the bids will include an internal bid. However figures are skewed to favour the contractors - often the assumed risk is adjusted until the external bid comes in under the internal one. If this wasn't done then the public sector bid would always win, as the government can borrow at a much lower rate than private companies.

For example, one evaluation projected risks of £105 million if the public sector took the contract, but only £18 million for PFI - handily making the PFI option £0.6 million cheaper than the public alternative. In another contract the PFI bid was given a 15 percent "optimism bias" adjustment, which handily took it a sliver (0.03%) under the public sector bid.

In part Carillion's collapse is due to the company's culture, seemingly unable to take lessons from Enron's collapse. Believing that simply moving money around is the same as earning it, using the income from one contract to pay the bills outstanding from the previous contract - and the directors creaming off a nice chunk for themselves.

The government has clearly been complicit in allowing this to happen. To ministers' credit, when the collapse came they stood aside and didn't try to rescue the company. Carillion's directors had put together a last-minute 'rescue plan', demanding a bailout of £160 million from tax-payers' pockets, they were rebuffed.

Will ministers be able to tough it out again if Virgin Care goes belly up? Virgin Care has most of the NHS PFI contracts (worth £1 billion last year), but is running at a loss and most of its assets are 'intangibles' (e.g. software).

What about the outsourcing specialist, Capita, which has 50,000 employees and 292 public service contracts? It has expanded in exactly the same way as Carillion, with its own increasing pension deficit - even as dividends and bonuses are being handed out. Capita has just lost 48% of its value after announcing a second profit warning, its capitalisation is down by 75% since 2013 (a loss of £5.7 billion).

Of equal concern are the knock-on effects of Carillion's meltdown. Someone will have to take over Carillion's contracts, the UK economy will have to absorb a debt write-down of £1 billion, and Carillion's ex-employees will need to adjust to losing their pensions. All this and Brexit is only months away with no trade agreement in sight.

Food security

At the same time that Britain is gearing up to leave the single market we are also steadily increasing our food imports. Already, half of what we eat is imported - and the imports even include crops that we grow ourselves. In 1984 our home-grown crops met almost the entire domestic demand for them - 95% were grown here and only 5% had to be imported. Today the split is 76% / 24%.

Our food trade deficit is a record £22.4 billion, and it can only get worse. The slump in the value of the pound has already pushed up import prices - every percentage devaluation of the pound means another quarter of a billion pounds on the food bill. Even the Brexit lobby admits that food is going to be more expensive post-Brexit.

However, the pound's fall is just the first shock to food prices. Already farmers are reporting that they cannot get picking and harvesting crews, so crops are left to rot in the fields. The crews are mostly made up of eastern Europeans who are willing to work hard for low pay in all weathers. The crash in the pound's value, the rise in racist behaviour by UK locals and the uncertainties around the status of EU workers in the UK makes Britain more and more unattractive to such people. Of course, if we leave the EU then the workers won't be able to come even if they wanted to.

This is already pushing food prices up in two ways: wages will have to go up to tempt local workers, and we will need to import more food to replace the crops left to rot - and those imports will cost more than the local produce.

If we fail to get a trade deal with the EU and have to fall back on WTO rules then food prices would be pushed even higher. Agricultural goods attract high tariffs under WTO rules.

Of course, WTO rules don't have to be imposed by an importer, we don't have to charge the tariffs if we don't wish to, meaning that we could keep food prices down. However if we eliminate food tariffs then other countries will undercut our farmers, driving them out of business, so instead of growing merely 50% of our own food we could end up relying almost entirely on imported food.

Even keeping the tariffs in place won't necessarily protect our farmers. They will be hit by the tariffs imposed by other countries (under WTO rules), which will make their exports uncompetitive. Further falls in the pound could counteract this, but then of course the price of imported food goes up.

The best case scenario is to retain as good a trade deal with the EU (our main market) as we possibly can. British farmers are still going to hurt, but we may be able to slow the slide into complete reliance on food grown in other countries.

The Gove scenario, on the other hand, seems to be to pay farmers to give up growing food, with him suggesting they "plant woodland" or turn their fields into "wildflower meadows or other more natural states".

Of course, his very generous salary means that he won't ever have to worry about putting food on his own table.

Keep calm and move to Berlin

After the Brexit referendum a van toured London with a billboard saying, "Dear start-ups, Keep calm and move to Berlin."

Right now UK start-ups are investors' darlings. They attracted £3 billion in investment last year - double what they received in 2016, and four times what French and German start-ups received.

There are worrying signs though. The number of funding rounds has decreased by 20% a year for the past two years, and rounds average about $1 million - half the size of French and German rounds. Our funding rounds focus on seed-corn funding for experimental start-ups, with generous tax breaks for investors, while on the Continent the money tends to go to businesses that have already proved their business model.

It is arguable which method is better - fund a lot of nascent start-ups and hope a few make it big, or help successful start-ups to grow into real businesses. It is unarguable that both strategies require a talent pool of skilled workers.

Germany now has more developers than the UK. The number of science, technology, engineering and maths graduates is rising rapidly in the Germany and France while the UK has a shortfall of 40,000.

Only a couple of years ago we could have shrugged our shoulders - if we need them they will come. Talent from all over the EU would fill the jobs, boosting our GDP and paying taxes without costing us a penny in training. Investors would want to join the gravy train, and funding would keep going up.

Instead, post-referendum the UK government - and Mrs May in particular - is intending to clamp down on immigration. We will no longer be able to make up our staffing shortfalls - in nursing, in agriculture, in technology firms - by poaching from overseas.

The immediate irony is that we have nearly full employment, so this is a political policy rather than a practical or economic one. However, if we don't want foreigners coming over here and taking our jobs, then we need to do them ourselves. That is all very well if we can find 40,000 people with the necessary technical skills, otherwise those start-ups will have to go where the talent is.

Keep calm and move to Berlin - who says the Germans don't have a sense of humour?

Regulations and red tape

One of the biggest problems facing us if we leave the EU is regulation or, as Brexiteers would say, "red tape". Those red tape bonfires we were promised are receding into those fabled sunny uplands as Brexit becomes a veritable tape machine.

The Irish border is the biggest headache. The Good Friday agreement has given us peace in Northern Ireland, but it depends upon free movement of goods and people. Brexiteers wish to prevent the free movement of people and - by dropping EU regulations - will also prevent free movement of goods.

Mrs May has attempted to fudge this, hoping that she can get a Brexit deal first and then sort out the border afterwards. If only she could - Border Force and Customs both need a lot longer than a few months to get in shape to deal with what is coming. However, the Republic wants to know right now what we intend so they can plan themselves. Fudge is no good for them.

Even worse, part of Mrs May's fudge has been to promise contradictory things to different people. She promised the DUP regulatory alignment with the rest of the UK, promised her own Brextremists regulatory divergence from the EU... and promised the Republic that Northern Ireland will retain full regulatory alignment with the EU.

Her get-out clause was that EU regulatory alignment would be temporary. When we work out how to police the border without physical border controls then divergence could begin.

One hope is that the rest of the EU will put pressure on the Republic to accept a hard border so that Brexit is not a complete shambles. However, France in particular strongly supports the Republic's position as they too want to know what the UK is aiming for. Forcing clarity over Ireland will force the UK government to lay out their real plans.

If they have any.