Speaking to the Financial Times in a personal capacity, Conservative party treasurer Michael Spencer, has said that he is “hopeful” that a Conservative government would deliver even bigger corporation tax cut after the next election. He also said that he things George Osborne could axe the 50p top rate of income tax.

“He expressed optimism that a David Cameron-led government would scrap Labour’s forthcoming increase from 40p to 50p in the top rate of income tax – a key bone of contention in the Square Mile. “I believe and I hope and I expect that that will be reversed in the foreseeable future,” he said.

Mr Spencer said he expected a Tory administration to go far further than the party’s existing pledge of a cut in the main rate of corporation tax from 28p to 25p, which will be funded by axing reliefs and allowances.

“I am hopeful that, over the next parliament . . . we will get corporation tax down towards the 20 per cent level.”

Last week David Cameron told business leaders that his party “aim to go further” in cutting the corporation tax rate below 25p, as a “long-term target” and George Osborne has said that reducing the tax breaks for debt could “potentially fund a significant reduction” in corporation tax.

Unlike the Labour Party, who are ideologically opposed to a strong financial sector, the Conservatives recognition the importance of the Square Mile to Britain’s overall position in the world, as well as the role it plays as the engine room of the economy.

Just day’s after Margaret Thatcher unveiled a new portrait of herself at Number 10, the first official portrait of David Cameron as Conservative leader has been released.

Painted by Jonathan Yeo, son of the Tory MP Tim Yeo, the oil on canvas portrait depicts Cameron looking relaxed and assured with hands in his pockets and no tie.

Yeo is no stranger to immortalising the great and the good, having previously painted Tony Blair, Prince Philip and Rupert Murdoch.

In 2007 Yeo caused something of a controversy when he produced a portrait of then President Bush made up of images from pornographic magazines. Yeo, who was a vocal opponent of the Iraq war, told the Sun at the time that he produced his ‘porn-trait’ for fun and not to offend, saying “I’m pleased with it.”

Earlier this evening Ben Brogan, the Daily Telegraphs newly promoted Deputy Editor, Tweeted that we should expect a “fascinating poll” of Labour marginals in its northern heartland.

Though the full poll is yet to be published the Telegraph has but up al little teaser on their Telegraph View page, and reading this reveals that the poll that will be published tomorrow is indeed a fascinating. Most importantly its will be encouraging for the Conservatives.

“The YouGov opinion poll that we publish today is very encouraging for the Conservatives: it shows that the party leads Labour by 42 per cent to 36 per cent in northern marginal seats. Indeed, the Tories appear to be doing better in marginals than they are nationally: the results reveal a swing in these seats of eight per cent since the 2005 election, as opposed to 6.5 per cent nationally. But we suspect that, for David Cameron and his strategists, the most interesting statistic might be the only one that shows Labour ahead. Working-class voters in these seats favour Gordon Brown’s party by a margin of 40 to 38 per cent. In other words, Labour’s lead among its core voters in battleground seats has shrunk to only two points. That is tantalising indeed, for it suggests that Mr Cameron is close to replicating Margaret Thatcher’s greatest electoral trick: poaching the votes of people who were previously regarded as the Labour faithful.”

The Telegraph poll will cause alarm on the Labour back benchers, as it shows that all 32 northern marginal seats currently held by Labour would fall to the Conservatives if this lead can be maintained or extended.

YouGov also found that the Conservatives are regaining the trust of the northern working class voters. Among those voters in the marginals, the two parties are almost equal: Labour scores 40 per cent and the Tories 38.

According to the poll, it would appear that Brown’s attacks on the Conservative’s economic policy and his message that Labour is the only party that can fix the economy is not working as well as he hoped.

A total of 40 per cent of marginal voters think Brown’s economic policies will either make no difference or make things worse. Only 16 per cent believe Government policies have started to work.

In discreet offices that occupy the elegant Georgian buildings of Mayfair and Belgravia, the heartlands of London’s hedge fund industry, there are a lot of nervous people.

But its not the state of the markets or their exposure that’s making them nervous. No they’re nervous because Gordon Brown refuses to see just how important these financial institutions are to the British economy.

Not only is Brown not fighting their corner as European legislation tries to clamp down on their activities, but recent British tax hikes have also spurred funds to consider leaving the city that has long been Europe’s undisputed financial capital.

The hedge fund industry is worth $250 billion ($377 billion) in Europe, and has boomed in recent years largely free of government regulation.

The sector didn’t cause the global financial crisis, but it has caught the eye of European governments and regulators looking to clamp down on the excessive risk-taking that brought many Western banks to the verge of collapse last year.

European union proposals would require hedge funds and private equity funds to register in Europe and to inform regulators about their trades and strategy.

EU lawmakers and governments are also suggesting that hedge fund managers be subject to the same kind of restrictions and bonuses currently being imposed on regular banks to limit rewards for short-term success.

Criticising the governments actions Shadow Foreign Secretary William Hague said: “[The] financial services are a vital British economic interest and, while we want to coordinate regulation internationally, the European Commission’s proposals have the potential to do serious harm to our financial services industry.”

Now some funds are considering swapping London for the less-regulated alpine air of Switzerland or the emerging markets of Asia. If this were allowed to happen it would be disastrous not only for London’s status as the financial capital of Europe, but also Treasury coffers.

The hedge fund industry says nearly half of the 40,000 people it employs in Europe are based in the British capital, along with 80 percent of the continent’s hedge fund assets.

International Financial Services London, a government-backed body, says London’s share of the hedge fund market doubled between 2002 and 2008, to 18 percent of the global total. The industry says it pays 5.3 billion pounds in tax to the British government every year.

There have already been signs of flight since Alistair Darling announced the higher rate of tax for people earning more than £150,000 would increase from 40 percent to 50 percent in April 2010.

Anthony Bolton, one of London’s most distinguished fund managers, this week announced he plans to move to Hong Kong to focus on the Chinese market.

Brown may have wanted his man to become the EU’s first High Representative for Foreign Affairs, but the real prize was the post of economic and monetary affairs commissioner. Instead of campaigning to get David Miliband into a senior European post, Brown should have been more concerned with protecting Britain’s economic interests.

Instead we now have Finland’s Olli Rehn in charge of reviving Europe’s economy.

Im sure Rehn is competent and will do a good job, but one thing is for sure – the British economy will not be at the forefront of his mind. And unlike Brown or Darling the Finnish finance minister Jyrki Katainen sees the power that this high-profile position gives his country.

Speaking to the Finnish News Agency Katainen said: “Finland’s voice will be heard better than before through Rehn,” adding “”The better the shape of EU countries’ economies the more Finnish products [they] can buy. That has a direct impact on Finland in the shape of tax revenue and jobs.”

Commenting on the appointment of Rehn and the UK’s lack of representation when it comes to the formulation of European economic policy Hague said: “We repeatedly warned the Government that going for the High Representative post and not a senior economic brief in the Commission could have worrying results. Once again Gordon Brown has put the next day’s headlines ahead of the long-term British national interest.
 

Giving evidence before the Iraq inquiry, Britain’s man at the UN said that attempts to win international authorisation for the invasion were deliberately undermined by the United States.

Jeremy Greenstock, the UK’s Ambassador to the United Nations at the time testified that President George W. Bush had no real interest in winning a U.N. resolution, which Britain and others had hoped would provide global backing for the conflict.

The ex-diplomat, who later served in Iraq as Britain’s envoy after the invasion, said that serious preparations for the war had begun in early 2002 and that the United States was little troubled by Britain’s hopes of forming an international consensus to justify military action.

In a written statement to the inquiry Greenstock said: “The United States was not proactively supportive of the U.K.’s efforts and seemed to be preparing for conflict whatever the U.K. decided to do,” adding the U.S. stance was “decidedly unhelpful to what I was trying to do in New York.”

Greenstock said that in his opinion the U.S.-led invasion of Iraq was legal, a view rejected by critics who say it violated international law because there was no second U.N. resolution specifically authorising the use of force.
But he acknowledged the unpopular war may have lacked legitimacy because the decision to invade did not have broad-based public support in Britain and in many other countries.

“It did not have the democratically observable backing of the great majority of member states, or even perhaps of the majority of people inside the U.K.,” he said.

According to Greenstock British officials, both at the UN and at the Foreign Office, worried about Bush’s private assurances to Blair. Bush insisted he supported work to try to win the support of key allies, including France, Russia and Germany. But when attempts to agree on a second resolution specifically authorising the use of force failed in March 2003 the invasion began just days later.

“President Bush’s words on this subject in public were rather less warm and specific than those he had used with the prime minister in private,” Greenstock wrote in the statement.

Greenstock told the inquiry that the U.N. process also was dented because the Bush administration failed to use sympathy for the United States in the wake of the Sept. 11, 2001, attacks to develop stronger relationships with international partners.

“It was the policy of the Bush administration to seek allies only when they needed allies for a particular piece of policy. If they could do it on their own, they would do it on their own,” Greenstock testified to the panel.
In a sign of just how frustrated Greenstock was at dealing with the US he told the five members of the panel that he threatened to resign his post if no international backing was agreed.

On Thursday Christopher Meyer, Britain’s former ambassador to the U.S told the inquiry that he believed Bush and Blair had used a private meeting at Bush’s Texas ranch, in April 2002, to “sign in blood” an agreement to take military action on Iraq — a year before Parliament approved Britain’s involvement.

Greenstock said that following the Crawford meeting, he realised Britain “was being drawn into quite a different discussion.” But, like Meyer, he said the talks were secretive and the conversation between the British and top U.S. officials were not disclosed to diplomats.

“That discussion was not totally visible to me,” Greenstock said. “I was not being politically naive, but I was not being politically informed either.”

Greenstock said that, by early 2003, the U.S. was unwilling even to consider delaying the Iraq invasion until October 2003, which would have allowed U.N. weapons inspectors more time to search for evidence that Iraq had weapons of mass destruction — the key justification for the war.

“The momentum for earlier action in the United States was much too strong for us to counter,” he said in his written statement.

Donations to the Conservative Party continue to roll in ahead of the next general election, with the party raising more money than all other parties combined, according to the latest update from the Electoral Commission published today.

Between July and September 2009 the Tories received £5,269,186 while Labour donors gave the party just £3,045,377. The Liberal Democrats were given £816,663.

Overall, donations to political donations for the quarter stood at just over £9.5 million, meaning that Conservative donations accounted for 55 percent of all donations in the third quarter of 2009.

Unsurprisingly out of the £3 million donated to the Labour Party, £2.3 million was donated by trade unions, while only £194,543 was given by companies and £202,557 in the form of individual donations.

Such dependance on a single sauce of financing reinforcing the fact that the party has become dependent on trade unions for its continued survival. It also shows that the hard work undertaken by Tony Blair and Lord Levy to wean the party of union subs has been total reversed by Gordon Brown.

Labour’s biggest donors were Unison (£760,825), and Unite’s Amicus (£601,053) and TGWU (£305,150) sections.

The Electoral Commission figures also show that Labour’s debts stood at £9,768,122 at the end of September compared with Tory loans totalling £4,153,939.

For the last month speculation has been growing in Westminster and amongst those who follow politics, that Gordon Brown may call the general election earlier than thought, in March to be precise.

Speculation that Brown may be planning a snap election was first sparked when civil servants noticed government planning after the end of January is remarkably light. This started to fuel rumours that No 10 intends to go to the nation much earlier than the expected date of May 6.

Then came an interesting little story from the Yorkshire Post’s Tom Richmond, who pointed out that by opting for a May election Brown would be in a stronger position to capitalise on any economic upturn, “a move that would make it easier for the Government to attack George Osborne’s record as Shadow Chancellor, and how, rightly or wrongly, he has positioned the Conservatives on the wrong side of the economic argument.”

Not wanting to be caught off guard by a snap election, David Cameron put the Tories on an “election war footing,” with 200 senior party officials being ordered not to take holidays after January.

According to Chris Buckland who broke the story, this is because “David Cameron wants all his top advisers at the party HQ to be available at a minute’s notice – including policy, research and campaign team staff.Shadow ministers will also step up talks with senior civil servants, who will brief them on what to expect if they win.”

With March 6 been muted as a potential date for the election, the BBC’s Political Editor Nick Robinson pointed out that with the Pre-Budget Report scheduled to be published on December 9, a March election is highly unlikely: “Now George Osborne’s backroom team have found a reason to stop worrying unless, that is, Gordon Brown wants to go to the country without having a Budget.

The date of the Pre-Budget Report was announced today as 9th of December. The Code for Fiscal Stability which Gordon Brown put into law in 1998, states that there must be “at least three months” between the Pre-Budget Report and the following Budget.

Thus, the earliest possible date for a 2010 Budget is the 9th of March. That is after the latest possible date – 1st of March – on which Gordon Brown could call a March election.

The Treasury civil servants are all working towards a spring Budget and Brown would be pilloried if he went to the country without telling voters what economic horrors might lie ahead.

So, it looks like we’re back to May which is, incidentally, where I’ve always assumed we’d be.”

While the announcement of the PBR date may have allowed Cameron and the Conservatives election team the opportunity to breath a collective sye of relief, it now appears that they once again think Brown will indeed go to the country in May.

Andrew Grice, the Independent’s political editor, reports that senior conservatives believe that Gordon Brown is looking at a March general election in a bid to head off the prospect of bad economic statistics scuppering his claim that he had guided Britain safely out of recession. “There is a real possibility that, after one quarter of growth, Britain slips backwards,” one Tory frontbencher told Grice. “If that happened, there would be fears about a double-dip recession. It would blow Brown’s credentials as the man who steered us through the storm out of the water.”

While Labour officials may discount the the prospect of a March election there is a clear advantage to going early for Brown, namely if he waits until May people will have received much smaller pay cheques than expected. This is because last year’s tax rise announcements will come into force in April 2010, including a higher 50p top rate on earnings over £150,000.

As Robinson pointed out, holding the election in March would mean that Alistair Darling would not be able to present a Budget, because of the three month rule in the Code for Fiscal Stability. This would mean holding an election without a Budget. Politically this would be highly dangerous, it would open up a clear line of attack for the Conservatives, giving them the opportunity to accuse Labour of running scared and afraid to hold a budget for fear of revealing the true state of the economy.

But as Brown struggles to keep his party united behind him, head off any bad economic news, make inroads into the Conservatives substantial poll lead and motivate grassroots activists who are struggling to promote his policies on doorsteps up and down the county, he may think such brazen election strategy is worth the risk.

Following the resignation of Conservative MP David Curry as head of the Commons select committee on standards and privileges last week, Veteran Labour MP and former minister Chris Mullin has been named as the interim chairman of the committee.

Curry was forced to resign charge from the committee tasked with supervising Commons expense claims on Friday following revelations in the Daily Telegraph over his own expenses.

The paper revealed that Curry claimed £30,000 for a constituency property which his wife had banned him from using after an affair.

The news that Curry is to stand down from one of parliaments most high profile select committees is just the latest instalment in a series of stories that have rocked the committee in recent days.

Another Labour member of the committee, Andrew Dismore, has faced calls for him to step down after questions were raised over his expenses.

He reportedly ‘flipped’ his second home designation in order to claim £65,000.

Dismore claimed £34,000 in second home expenses for a west London flat which housed his girlfriend’s homeopathy surgery, while designating a north London flat as his main home.

He then switched his second home designation to the north London property and claimed a further £31,000.

Defending his actions Dismore said: “It was my intention when I bought the Hendon flat for it to be my main home. After about 18 months it became clear to me that with increasing parliamentary demands on my time I was spending more time in London than in Hendon, so it was the right thing to do to designate the Hendon property as the second home and the London property as the main home,” adding “The Hendon property was cheaper to run, which was also an important consideration to me, and my claims progressively and rapidly reduced year on year since then.”

Stephen Byers has announced that he will quit Parliament at the next general election.

Mr Byers is one of the most prominent Blairites on Labour’s backbenches and has been a critic of Gordon Brown’s performance as Prime Minister, openly discussing the prospect of challenges to his leadership.

He said he was standing down as MP for North Tyneside “in order to pursue other interests and look to fresh challenges”, but insisted that he would continue to support Labour in the months and years to come.

He was forced to resigned from the Government in 2002 when it was revealed that his adviser Jo Moore suggested that the September 11 terror attacks made it “a good day to bury bad news”.

On the backbenches, he joined with a small group of high profile Blairite ex-ministers, including Alan Milburn and Charles Clarke, to push for the Government to stick to New Labour policies.

Earlier this year, Mr Byers was once again disgraced when the Daily Telegraph revealed that he had claimed £125,000 in second home expenses over five years for a flat wholly owned by his partner.

More to Follow.

David Cameron is planning to move Prime Minister’s Question Time from Wednesdays to Thursdays in a Commons shake-up, according to the Dail Mail.

Tim Shipman, the papers Deputy Political Editor, suggests that the move would be to ensure more MPs were in Westminster for more of the week. A “senior Commons official” is quoted by the Mail, who says that Shadow Leader of the House Sir George Young has already discussed the matter with Speaker Bercow:

“Sir George Young has made it clear that he is keen to move PMQs to Thursdays. He thinks it’s necessary to lengthen the working week and make sure MPs don’t knock off quite so early on a Thursday. He thinks the best way to do that would be to move PMQs since most MPs would want to stay around.”

If the move goes ahead then it would constitute the biggest shack up in MPQs since 1997 when Tony Blair moves it to Wednesday. Until then PMQs lasted 15-minute and was held on Tuesday and Thursdays.