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There's a lot of chatter in the media today about this:

ConservativeHome's ToryDiary: Lowering and simplifying tax for small business

George Osborne is giving a speech to the Chartered Institute for Personnel and Development and the British Chambers of Commerce today, about simplifying the administration of income tax, national insurance and VAT.

Here's the original:

Liberal Democrat Manifesto for Business (2005)

Liberal Democrat top policies for business:

• Carry out the biggest act of deregulation by scrapping the DTI.
• Carry out independent impact assessments on new regulations.
• Introduce a sunset clause on new regulation.
• Reform business rates with an allowance for small businesses.
• Simplify the tax system to ease the burden on small businesses in particular
• Focus on increasing skills of the workforce.

You can read the rest on the Lib Dems' publicly accessible policy pages. Cut and paste as much as you like George!

There used to be a rather insulting saying about PR systems that "if the Irish could understand it why shouldn't we". The Times' leader article today proves they still can't:

Vote of No Confidence -Times Online:

This is the nub of the issue. The current electoral system has the drawback of giving the largest single minority at Westminster an extremely large share of political power. Yet proportional representation would mean that much smaller minorities would wield undue influence, as without them it would not be possible to form a stable administration. Would this constitute progress?

It is not surprising, therefore, that the official Review of Voting Systems could not work up any enthusiasm for overhauling the current system. What is more intriguing is why the 110-page report has not seen the light of day until this morning. There has to be the suspicion that Labour, aware that at some point it might need the assistance of the Liberal Democrats to survive in office, is unwilling to offend its potential partners by publishing a document which is so damning of their pet project. Sustaining a dubious deal at a later date is surely the worst argument for PR.

Drawback? Drawback? It's a fecking democratic outrage, that's what it is! How can anyone vest so much power in an individual like a Blair, a Brown, a Cameron or, one day again, a Campbell on the mandate, at the last count, of just a quarter of the voting age population? It's almost as repugnant as that other scenario that sees a Chavez, Mugabe or Hussein elected on huge rigged votes. Come to think about it, even Mugabe is more sophisticated than that, allowing his opposition to win seats in parliament but reserving a presidential right to appoint as many more as will give him a decent majority (but then Blair had his peers I suppose, just to make sure). No, I take it back, Mugabe would just love the British system.

As to whether any particular form of PR would produce a situation in which "much smaller minorities would wield undue influence" that's so much tommy rot too. They cite Scotland's teething problems with PR, but it hasn't prevented a minority government being formed at Holyrood, and looking abroad, is Germany some unstable state? The Netherlands? Or that economic powerhouse of the EU, Ireland? Or any of the other big democracies that use fairer voting systems? Italy is corrupt from top to bottom it seems and Israel's very birth as a state almost made sure that certain minorities would hold undue influence.

Let's not forget that when "we" had the opportunity to sit down and draw up constitutions and electoral systems for two effectively new countries after the war, Japan and Germany, we didn't choose to foist our decrepit system on them, and look at how they have by and large shone since then.

But for me, the irony of this sort of whining from organs like the Times is that surely they would normally be crying out for less government. If PR delivers a legislature in which little can be done wouldn't that be a good thing, especially for lovers of the status quo? No more far reaching change wreaked by a minority party with a huge majority in the legislature and total control of the executive. A situation where all parties would need to agree in order to do anything significant - that's real democracy, surely.

For me, there is the tantalizing prospect, most of all, that we would see the bigger parties dissolve into their constituent parts - Cameron Tories and the Libertarian Right, Old and New Labour, Orange Liberals and Social Democrats and we would all get a chance to prioritize the traits we want in individual candidates. Of course I simply loathe Westminster and the overbearing presence it has in our lives, but for me, second only to dissolving Westminster and Whitehall altogether would be a system that makes it as hamstrung and impotent as possible, only able to do something when all our various persuasions of politicians actually agree on it.

I've just been watching Prime Minister's Questions, something I rarely get the chance to do, but I'm off work not very well in this heat so I happened across it today.

Is Blair always so patronizing towards Campbell? It's a good job Ming's one of those polite well-bred advocates - though I dislike PMQs as a rule, even I would say Ming could be a bit more pugilistic against the arrogance of Tone. Anyway, Ming was of course right to ask about mid-east ceasefires and about why, in particular, the rest of the world is not being terribly forthright in demanding one of Israel.

But Blair's response gives me the hook for something I've been pondering about writing since the latest Israeli attacks on Lebanon began last week. Blair was responding to the notion, implied by Campbell, that Israel's response to Hezbollah's kidnapping and subsequent rocket-bombing of northern Israel is "disproportionate".

Set aside for the moment the question of "which came first" (because although it's clear that this immediate inflammation is ostensibly a reaction to the kidnapping of the two Israeli soldiers it' not at all clear for example that Hezbollah would have been shelling northern Israel quite so strongly - 1600 rockets according to Blair - if they themselves were not now under attack). The big problem I have with Blair's response was that it appeared to place Hezbollah and the Israeli government on a level of moral equivalency they simply do not share.

What's happened is that a more or less maverick and self-selecting group, which yes, has some influence at the government level of the country (Lebanon) in which they base themselves, but over whom the civil government of that country is hopelessly ill-equipped to exercise control, has taken it upon themselves to commit criminal acts against citizens of the neighbouring country.

Hezbollah is a terrorist organization under any definition of that word. Ehud Olmert heads an elected government. Moreover he heads a government whose forces are amongst the best armed in the world, in quantity and technology, and whose intelligence services have, or at least had, a reputation second to none for the most part. A government that is fairly elected. It can be said to be better representative of the people of Israel for example than Tony Blair's can of Britain's. Much moreso than representing merely their idea of political policy, they stand as representatives of the moral conscience of their citizens.

So, in the red corner, we have a bunch of criminal thugs. They may or may not have a real grievance against Israel over their perception of justice that has put dozens of their colleagues in Israeli prisons, but they go about addressing that using criminal means - kidnapping on some kind of tit-for-tat basis. But they are criminal, immoral, or at best amoral.

In the blue corner, we have one of the most advanced and sophisticated nations on the planet. One would have thought that even if they were so frustrated by the inability of the neighbouring government to exercise control over the criminals harrying their citizens from the other side of the border, and having concluded that diplomatic efforts were a waste of time (if they genuinely tried, which I doubt, given the reaction of clear surprise around the world), and so deciding to do something about it themselves, a surgical strike of some kind against the criminal organization itself would not be beyond the bounds of their capabilities.

But what route do they in fact take? They aim to "set Lebanon back twenty years". They cut the country off from the rest of the world. And far from any technologically surgical attack they lob shells from T-17 tanks and motorized artillery all over the place, destroying civil infrastructure. They kill countless of for all we know totally innocent and Hezbollah-hating ordinary civilian citizens of the Lebanon. Of course the destruction of the infrastructure has the pretense that it is used by those criminals or their supporters on occasion, but that does not mean it's justified to so affect the ordinary lives of ordinary Lebanese, to terrorise them, trapped by blown up bridges, ports, airports and expecting their homes to be shelled any minute.

This has all the morality and justice of hanging any ten men, women and children in in the village square because you believe some insurgent might have operated from there. It is not the action of a moral state. Iain Dale at the weekend mentioned that Olmert was never a military man and had to prove his credentials, but when that assuredly involves killing civilians, turning their world upside down in a foreign country, it is just as evil as any terrorist. It is the politics of the old testament - "Saul has killed his thousands, David his tens of thousands" - immoral.

Yet the rest of the world's reaction is what really gets me. We sit here scribbling in the media and so on about whether the response is justified, proportionate, yet do very little about it. We are too comfortable. We have four million counsellors counselling people affected by reading about the London bombs in their newspaper the next day; we cannot imagine what life is like when everything is suddenly taken away and there's no help on offer. It's bad enough when such a tragedy is inflicted by nature, and we all jump to help with aid appeals and so on, but when it's inflicted by other humans, humans moreover that are the moral agents of their countryfolk, and the world does so little to help, it's sickening.

Quite by chance, as if on order to make the local elections more exciting in my ward, two local planning issues have suddenly popped up (not entirely unexpectedly it has to be said) that are likely to cause a deal of controversy when they get to decision-making time. I don't want to talk about their planning merits or otherwise on here. But I do want to use them because they are very good examples of why I am so passionate about land reform.

The first, in the ward in which I am standing is an application for new student residences adjacent to the site on which I am a warden proposed by my employers, Oxford Brookes University. To be fair it will make more of an impact on residents in the neighbouring ward, but it is the economics of it all I want to look at not the planning, to show why land value tax would be such a benefit to the community.

The second, just over the main road in the neighbouring ward but which will make a significant impact on neighbours in both wards one way or another is the news today that Tesco have bought up a local former pub building from a local bar/restaurant entrepreneur who had seemingly been knocked back in the early stages of planning such that he no longer felt it worth fighting for his ideas for the site. Here I want to look at how the planning system seems to favour the bigger developer with the financial clout and how this affects the fairness of land law.

But first, the new proposed halls of residence. This site is approximately quarter remaining of a site the university acquired from the Department of Social Security about seven years ago now. When I was last on the council, just at the end, they had owned the site for about six months, if I remember correctly having bought the whole thing for either eight or eleven million pounds through a charitable trust set up for the purpose and were just getting outline planning consent.

The entire site had been only about a quarter used for several years since most parts of the DSS had moved out. And even when at "full capacity" it had been an egregiously inefficient use of a piece of prime inner suburban land - even for offices - since it was half car park and half single storey nissan hut type buildings.

Since it had been government owned, effectively there was no income to the public purse from this land. Once it was owned by a charity the empty land has generated no receipts to the public purse in the form of business rates. The charitable trust sold off about a quarter of the land to the adjacent Oxford International Centre for Islamic Studies, first for use as a contractors car park and now it lies more or less empty. A hectare of prime city centre building land. The university built nearly seven hundred student rooms in new halls on half of the original land and these were opened five years ago now. But it is the effect of this last quarter of of the site I want to examine and show how failing to encourage optimal use of land where it is available is a disaster for the rest of us.

The site is about a hectare. So if the original purchase price for the entire site was the higher of the two figures I remember hearing at the time - eleven million pounds, its share would be two and three-quarters million. The current application is for 335 study bedrooms and since the student halls market has changed out of all recognition in those seven years, commercial firms are willing to pay it is rumoured up to £45,000 per room for suitable land, as a site alone it would be worth more like fifteen million pounds.

Point one: whilst the local authority has received virtually nothing for this land in rates, the owners, either the university or the charitable trust, have effectively got a book profit of £12 million - a four hundred per cent return in seven years.

335 study bedrooms would, if theory, allow some 83 four bedroomed family homes to be freed up from the current student private rented market somewhere in the city assuming student numbers overall remained static. That's 83 largeish families who have been otherwise excluded from the housing market in Oxford for seven years because these halls did not exist. At its worst, that means that the tax-payer, through housing benefit, has spent upwards of ten million a decade supporting those households in private rented accommodation while they wait for "affordable housing".

Point two: the cost to the tax-payer of that piece of land laid idle and not producing any local taxation has been at least ten million in housing benefits to private landlords while the owners have made that massive book profit.

Now imagine if that land were taxed on its value at its most productive use - that's currently the £15 million or so a commercial halls of residence developer would pay for it. A ten percent land tax would now be yielding the public purse £1.5 million a year, and more importantly would have been liable for that tax all the while it has been so underused. No owner with any financial sense would have kept that land out of productive use with a tax bill like that. The land would have been brought into its best use long ago, either as housing itself or freeing up those equivalent 83 units for family use instead of student private lets, and the tax-payer would not have had to support 83 families to the tune of that £10 million pounds a decade in supported housing.

Now, don't get me wrong, I am neither criticising my employer nor demanding ten storey blocks of flats on every vacant site. But I am illustrating the cost to society of holding land out of use, and the unfairness where, in doing so, the owners have made a vast profit at the direct expense of the tax-payer. It's the system that causes this, not the participants in that system who are only following the rules everyone else plays by.

Now to the "Tesco pub". Some time ago this down at heel local pub was closed, its future uncertain. A well known local restaurant and property entrepreneur bought it up and a few months ago publicized his idea for turning it into a row of three shops and some flats above in a "landmark" new building. But with an ambivalent local reaction and, it seems, less than enthusiastic reception from the city's planners to the idea, this chap pulled his plans and decided to look around for a buyer. The land registry records show that the property had cost him £400,000 and that it was mortgaged so he had financed it empty for seven or eight months developing his ideas and the prospect of a long uphill struggle into the unforeseeable future in the planning system means he would be financing it empty for many months, if not a couple of years to come.

It is opposite a long established and not so long ago refurbished and extended local Co-op store (where I joined as a member of the Co-operative and where I shop several times a week in preference to all the other supermarkets around I could potentially choose from) and a less long established Costcutter store that houses the local Post Office and a similarly aged Chemist shop that replaced a locally owned and well patronized cycle and fishing tackle shop and an electrical retailer. It is, to put it mildly, on an awkward site, at a very odd junction just at the point the Marston Road becomes a dual carriage-way "boulevard" and buses turn right against the traffic whilst the off-road cycle lane comes to an end, the road splits into two lanes prior to a busy and slightly awkward double roundabout junction. There is just enough parking in the lay-by outside the existing shops for their customers and nowhere else for cars to park.

The site might have been viewed as ideal for shopping or catering uses complimentary to the existing neighbouring shops. Extending the range of goods and services people could get in a single visit to the local shops. All very sustainable. And contributing to the local economy and the success of local entrepreneurs - all of which tends to keep more money in circulation more locally in Oxford, making us all better off.

But now Tesco have the site. Obviously, they are in competition with two of the existing local stores. For many, they will do a better job of supplying their grocery needs and at lower prices. That too is good for peoples' pockets and therefore local wealth retention. But since, if they've borrowed to buy it at all, as opposed to taking the purchase price out of the weekend's take from the nearby Tesco out of town superstore, it's probably a tiny dent in their current income rather than a major liability as it would have been to the local entrepreneur who had borrowed to buy it as a significant chunk of his portfolio. And they can afford to sit on it until the planners give in, until attrition of any opposition to the idea gives them an easier ride in the planning process.

At the moment I wouldn't dare to have made up my mind about the idea of Tesco Express there. On the one hand, competition is good for the consumer. On the other, Tesco has such financial clout that it could send its competition to the wall and leave it eventually and open field to increase prices because of its local monopoly. And there again, whilst as a member I would be very sad to see either of the two existing competing stores fail, they would almost certainly then be occupied by some other, and probably local, entrepreneur with another great idea that would compliment rather than compete in its turn with the Tesco store. Again, this increases the range of goods and services a person can get in one trip to the local shops.

But all I am highlighting is that because the planning system causes a proportionately greater opportunity cost to fall on the smaller businessman it actually favours the big financial muscle of large corporates who can afford to take the risk for longer. It is not a level playing field. But, as in the previous story, it's the playing field on which all would be developers have to play. On the other hand again, it would be quite wrong for the planning system to become a tool of protectionism, benefitting one business or businessperson over another by preventing competition. Perhaps in an LVT based system the tax payable on a site should be suspended for the time during which the planning bureaucracy was deciding on a proposal to concentrate the minds of planners on getting the best deal for all parties in the minimum time possible and enabling people to get on with running their businesses, extending their homes, or whatever the application was for.

Anyway - all that was a bit of a marathon use of two local and serendipitously current issues illustrate quite well some of my hot button issues on land reform, free trade and anti-protectionism and localism.

I was at the Not-the-first-hustings yesterday at the South Central Conference at Newbury and was impressed by both Nick Clegg and Chris Huhne. I saw nothing to make me change my loyalties away from Chris, but one thing in particular Nick said (twice at least) was worth flagging up I thought.

I think the first reference was in his speech when talking about how to re-engage voters in an era when so many people say "what does government matter when the global conglomerates have all the power" he seemed to say that government should seek to control (as in rein in not own I presume) big business. Then again, when one of the questions was about how to sell Europe, he suggested that one of the benefits of Europe was the ability of governments to club together to control such global corporations.

I'm don't recall whether these were the only references to what one might call "economic" policy but they stuck in my mind because, whilst the media seem to talk about Nick being on the "economic liberal" (code for "right wing" in the economically illiterate media) part of the party, these are the sort of anti-corporate slogans that characterize Caroline Lucas or Naomi Klein more than they would Milton Friedman. Further, in reference to his past role as an EU trade negotiator, he seemed to believe that this in fact meant Euro-protectionism rather than freeing global trade.

On the other hand, Chris, who I think it is generally accepted is more grounded in economic theory, cited yesterday Hobhouse and the early twentieth century liberal reformers as his heros and today on Andrew Marr's program Lloyd-George. These guys knew all about the best mechanisms for helping the poor working classes - free trade and anti-monopoly.

I can't say whether Chris shares my view that the welfare state as conceived by these reformers was a necessary but essentially temporary measure only needed in an economic system that favoured the land-owner, capitalist and banker. But as a land value taxer, I would identify Chris with an "economic liberalism" that in a sense supersedes what many call "social liberalism". That believes that if we get the economic system more equitable, by reducing protectionism and monopolistic advantage, we create greater opportunity for the "little guy" than we can do by state led intervention in people's lives and wealth and consequently need a smaller safety net as a result.

Economic liberalism is "of the left" not the right. Its aim is to break the class and wealth based advantages enjoyed by the privileged and give the working person a greater share of the value of his or her production. Chris, I think, understands this. But Nick does not seem to be the "economic liberal" the press portrays him as, at least judging by those comments yesterday, but rather takes a protectionist and interventionist stance. A position which also has a big following in our party to be sure; this is not a value judgement, but it is a position I do not personally support (any longer).

All it goes to show really is that we cannot put any credence on the media who mischaracterize "economic liberalism" as something of the right and "social liberalism" as something of the left, and, having failed to understand either put our two candidates in those false categories. Nick might be on the "right" in the sense that he is apparently a protectionist, but it's not the sort of "right" the meedja seem to understand!