VZCZCXRO8631
PP RUEHFL RUEHKW RUEHLA RUEHNP RUEHROV RUEHSR
DE RUEHLO #3042/01 3391657
ZNY CCCCC ZZH
P 041657Z DEC 08
FM AMEMBASSY LONDON
TO RUEHC/SECSTATE WASHDC PRIORITY 0586
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY

C O N F I D E N T I A L SECTION 01 OF 03 LONDON 003042 
 
SIPDIS 
NOFORN 
 
E.O. 12958: DECL: 12/03/2018 
TAGS: PGOV ECON PREL PINR UK
SUBJECT: (U) QUEEN OPENS PARLIAMENT WITH A THIN LABOUR 
LEGISLATIVE AGENDA, BUT POLITICAL AND MEDIA FOCUS REMAINS ON MP RAID UPROAR  Classified By: PolMinCouns Greg Berry, reasons 1.4 (b/d).  

¶1. (C/NF) Summary. The Queen laid out Gordon Brown's legislative plans for the coming year in the annual Queen's Speech at the December 3 State Opening of Parliament, but most of the political and media attention was not on PM Brown's legislative agenda (much of which had been released already) but on the future of the Speaker of the House of Commons Michael Martin.  Martin was forced to read a statement to his colleagues, immediately following the Queen's departure from Westminster, in which he explained why police were allowed to conduct a November 27 raid of Conservative MP Damian Green's parliamentary offices as part of a Scotland Yard investigation into the unauthorized disclosure of confidential government documents that had embarrassed the government.  Despite the Queen's announcement that 13 new bills would be introduced to help stabilize the rapidly declining UK economy, including a plan to allow homeowners to defer mortgage payments for up to two years if they lose their jobs or become severely ill, MPs from all parties were focused on the search of Green's office and what they called an infringement of the ancient parliamentary privilege of confidentiality; the future of Speaker Martin dominated much of the media reporting following the speech. Tory leader David Cameron criticized PM Gordon Brown's legislative agenda for focusing on short-term political gain rather than the long-term national interest.  There were no foreign policy announcements in the speech, although Cameron in his statement after the speech noted President-elect Obama's intention for a "troop surge" in Afghanistan and surmised the Prime Minister will come under pressure to provide more troops.  Cameron pressed Brown to obtain further troop commitments from NATO members before agreeing to increase Britain's troop presence.  Labour's emphasis on populist, short-term economic measures, at the expense of what political critics of Labour claim is broader economic and social needs, suggests to many observers that Brown is considering calling a general election earlier than May 2010.  End summary.  

A Slimmed Down Legislative Program... 
-------------------------------------  

¶2. (SBU) Prime Minister Gordon Brown had already revealed much of the content of the Queen's Speech in an unprecedented release of a draft of the speech last summer.  The speech, however, had required almost wholesale re-working in the last several weeks to address the global economic downturn and as the UK prepares for recession.  The government pared down its agenda significantly to focus tightly on the economy, and the previously announced 18 draft bills were replaced by a mere 12 draft pieces of new legislation in what is the slimmest legislative program since Labour took power in 1997.  Some controversial legislation has been put on hold, such as the Communications Data Bill, which would have allowed a national database of phone calls and e-mails to be established, and the Constitutional Renewal Bill, which Brown trumpeted as increasing powers for MPs, specifically giving them the final say over the country's decision to go to war.  Also postponed was a "UK Bill of Rights," a proposal Brown had given much attention to upon becoming Prime Minister last year.  These measures will now, however, only be introduced "when time allows."  The Political Parties and Elections Bill, which aims to introduce greater transparency in political party donations, will be carried over into this year's legislative agenda from last year.  There were no foreign policy announcements in the speech, although Opposition Leader David Cameron noted President-elect Obama's intention for a "troop surge" in Afghanistan and surmised that the Prime Minister would likely come under pressure to provide more troops. Cameron pressed the Prime Minister to obtain further troop commitments from other NATO members before agreeing to increase Britain's troop presence.  

...With a Focus On the Economy 
------------------------------  

¶3. (SBU) The Queen told Parliament that "fighting the economic downturn" was the government's "overriding priority" for the year ahead.  A Banking Bill, which has already been introduced by the government and was carried over into this session, will seek to improve financial stability through measures to minimize existing liabilities in the banking sector by allowing the Treasury and the Financial Services Authority to intervene earlier if banks find themselves in difficulty, as well as strengthening protection for depositors if banks do fail.  The headline proposal in the Speech was the government's proposal to allow homeowners who fall behind on mortgage payments due to a loss of job, sickness, or a large fall in income to be able to request a  LONDON 00003042  002 OF 003   two year hiatus on their mortgage payments, with the deferred payments guaranteed by the government.  Details of the program have yet to be worked out, but Britain's eight largest mortgage lenders representing 70% of the mortgage market have agreed to support the new program, according to Downing Street. Under the program, deferred payments will be added to the principal with the borrower paying this off when his/her financial circumstances improve, maintaining an affordable monthly payment by extending the term of the mortgage.  Deferred amounts not repaid would be reimbursed to the lenders by the government.  The program, entitled the Homeowners Support Mortgage Scheme, requires no primary legislation and officials estimate government guarantees may amount to about 1 billion of which perhaps 100 million would be paid out.  The program will also have the effect of eliminating many non-performing loans from the lenders, portfolios, thereby freeing up reserves to support new lending.  The announcement received positive media coverage and was welcomed by opposition parties.  

And Other "Populist" Measures 
-----------------------------  

¶4. (SBU) Many of the measures on the government's legislative agenda have a populist tone and reflected what several political observers suggested was "positioning" by the Brown government to hold a general election in 2009, rather than wait till May 2010, the deadline for an election.  A welfare reform bill will aim to crack down on those cheating the benefits system and get more single parents back to work once their children pass the age of one.  Migrants wanting to settle in the country will face more legal obstacles if they have committed crimes or failed to integrate into UK society under the proposed "Borders, Immigration and Citizenship Bill."  Police accountability will be stepped up with the creation of directly elected representatives to police authorities; and lap dancing establishments will face tighter controls under the Policing and Crime Bill.  All these issues are hot-button for Middle Britain and give Labour some deliverables to campaign on, especially if the economy remains in the doldrums at the time of any election.  

The Spotlight Turns to the Speaker 
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¶5. (C/NF) On a day normally preoccupied with high ceremony followed by intense debate over HMG's legislative agenda, the media and political spotlight was, however, quickly turned toward Speaker of the House of Commons Michael Martin, who has faced a flurry of sharp and increasing criticism for his decision to allow police to conduct a November 27 raid of Tory Shadow Minister for Immigration Damian Green's parliamentary offices.  Martin attempted to deflate criticism from Opposition MPs and calls for his resignation by reading a statement, immediately following the Queen's departure from Westminster, on his role in the incident and by allowing Members to debate the Green affair.  In his statement Martin blamed House of Commons Sergeant at Arms Jill Pay for allowing the search, which was part of an investigation into Green's disclosure of confidential information that had embarrassed the government.  Martin claimed he did not know that the police did not possess a warrant for the search, but did admit that the police had told him a week earlier that they were considering a search of Green's parliamentary offices.  Members of Parliament from all parties expressed outrage at what they called an infringement of their ancient parliamentary privilege of confidentiality and an attack on their independence; Opposition MPs called for the Speaker's resignation.  One shadow Tory secretary told Poloff that Martin was notoriously thin-skinned and unpredictable, and that Opposition MPs have begun questioning his independence from the Government (Embassy comment.  Unlike his U.S. counterpart, the Commons Speaker's role is non-partisan -- he/she routinely does not vote on legislative matter as a reflection of this tradition -- and the job is seen as requiring strong independence from the Government in order to reflect the interests of the Commons as a whole.  End comment.) Home Secretary Jacqui Smith is reportedly preparing a statement on the Home Office's role in the raid, which may keep the issue in the press for the next day or two, and Speaker Martin is clearly not out of the woods yet, but Labor MPs remain loyal.  Several political pundits have said they doubt the Speaker will be forced to resign.  

What About Green? 
-----------------  

¶6. (SBU) Parliamentary outrage over the raid on Green's office has taken attention off the reason the raid occurred. Police arrested MP Green as part of an investigation into  LONDON 00003042  003 OF 003   leaks of sensitive information from a junior Home Office civil servant, Christopher Galley, who had been feeding information to Green.  Green released information to the press and in the process had embarrassed the government.  One of the leaks highlighted that more than 5,000 illegal immigrants were working as security guards, with one employed in Parliament.  Police say they arrested Green, who was later released after questioning, on suspicion of "conspiring to commit misconduct in a public office" as well as "aiding and abetting, counseling or procuring misconduct in a public office."  Such a raid and arrest of a member of parliament was unprecedented and MPs are arguing that leaking information embarrassing to the government, as long as it was not damaging to national security, is a vital way of holding the executive to account.  In comments after the Commons debate on the raid and the Speaker's actions, Tory leader David Cameron expressed "shock" that police were allowed into the Commons without a warrant, and said he was "disappointed" that Gordon Brown was reportedly not certain whether a warrant was even necessary for the search to occur.  Cameron reasserted his support for Green and underscored the role of Her Majesty's Loyal Opposition to hold government to account, dismissing government and police claims that the unauthorized disclosure of Home Office information had contained anything of a national security nature.  

Comment 
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¶7. (C/NF)  In part because of the Martin affair, and because there were few surprises in the Queen's Speech, there has been little media or political debate over Labor's rather light legislative agenda.  Some insiders have suggested to us that Labor has slimmed down its plans and focused on populist, short-term economic measures in the hope of keeping options open to call a general election earlier than the June 2010 deadline.  One Tory MP tells us that this would be possible only if Brown saw polling figures tip Labor's way definitively in the spring of next year.  If there were to be an early election, Brown wants to avoid previewing the move publicly to avoid embarrassment should it not then occur and would share the decision only with insiders such as (Secretary of State for Business) Lord Mandelson and (Secretary of State for Children, Schools and Families) Ed Balls.  For now, both are mum about any such plans when asked by the UK media.  Visit London's Classified Website: XXXXXXXXXXXX
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