Elsewhere in today’s TFI bulletin my Downtown colleague and fellow blogger Jim Hancock has, far more ably than I could, explained the political pressure that this week saw Prime Minister David Cameron take the rather reckless decision to offer an ‘in or out of Europe’ referendum if the Conservatives win an outright majority at the next election.

For most businesses I have spoken to, the uncertainty that this presents is far from helpful at a time when we live in a very uncertain world anyway – and the general view is that it makes the UK look a little immature, and more than a little parochial.

However, whether you are pro Europe or anti, the one thing that a vast majority of business owners will agree on is that many of the rules and regulations that surround employment law and the wider health and safety agenda that emanates from Brussels are an absolute minefield.

The cost of implementing and complying with such complex bureaucracy is nothing short of scandalous. It not only encourages poor staff to adopt a ‘where there’s blame, there’s a claim’ culture when they are dismissed for legitimate reasons; but it discourages business owners from recruiting for fear of being taken to the cleaners by unscrupulous employees, aided and abetted by state financed advisors.

As the son of a Trades Union activist, and as someone who became a politician to promote equality, fairness in the workplace and social justice, I am now disappointed to have to say that the pendulum has swung too far in favour of employees.

I support the minimum wage, equal pay for women and the rights of workers to be protected from genuine cases of unfair dismissal. However, it is simply a fact that sometimes a member of staff doesn’t fit the role they were appointed to, doesn’t have the skills they claimed to have, or fail to demonstrate the level of dedication and commitment that a job requires. In such cases dismissal should be an option, without the necessity of consulting with a Philadelphia lawyer.

And what protection for the business owner when a member of staff who you have invested time, energy, resource and money simply decides they have had enough, walk away, without the courtesy of working their notice period or having the professionalism, not to mention loyalty, of providing a smooth transition and handover? The answer, of course, is NONE!

However, on the point of EU inspired red tape, I have to say that I am of the opinion that it’s not them, it’s us.

I have visited pub play areas in Spain, seen building work taking place in Italy, observed how the Irish interpret the rules governing European funding programmes. None of them abide to the letter of the law to the nth degree as we in the UK do.

Our civil servants from Westminster to Westmoreland insist on every European I being dotted and T being crossed before they will approve a contract; issue a licence or provide a safety certificate. The word ‘advice’ is confused with ‘legally binding’ – but only here.

The French, the Germans, the Italians and our other euro partners are baffled by the UKs obsession with accepting every piece of advice Brussels throws at us. It’s not a renegotiation or a referendum we need. It’s a dose of common sense injected into the jobs-worth brigade, so that legislation is implemented flexibly and in the spirit in which much of it was meant.

The latest Populas opinion poll for the Times shows that Labour is 15 percentage points ahead of the Conservatives, 45% to £30% - unsurprisingly the Liberal Democrats are lagging way behind on just 10%.

Great news for Labour, as it is the biggest lead recorded for any party in this parliament, and so at their Manchester conference next month, Ed Miliband can tell delegates to go back to their constituencies and prepare for government. Well, perhaps not...

Further scrutiny of the poll showed that a huge number of those questioned see David Cameron as a much more credible Prime Minister than Ed. In a General Election campaign, where we will be subjected to a series of ‘Presidential’ style debates, and have endless advertising campaigns and party political broadcasts about the ‘leading men’, then Labour strategists must fear that the 15% lead will disappear quicker than a large glass of red wine when placed in front of Downtown events manager Roger Jonas.

I recently had the pleasure of interviewing the other Miliband, David, at a Downtown Liverpool event (click here for video). His confidence and charisma shone through as he dealt with issues ranging from Hillsborough through to the forthcoming American election and the global economy.

His reluctance to return to front bench politics and take a position within the Shadow Cabinet is understandable. He must, whatever he says, still be wounded by the fact that he lost his party’s leadership because of the idiocy of Labour’s union bloc vote.

His reason publicly for not taking a front bench post is that there would be constant speculation about when he was going to make his move to dispose of Ed. I don’t buy that; particularly as such speculation already exists anyway.

For Labour though, the issue is this. Can they really afford to have their most talented politician on the backbenches?

Ed Miliband will not win in a head-to-head contest with Cameron – and certainly not against Boris Johnson should the Tories get jittery between now and 2015. It is essential that the opposition make a case based on a strong team. Without David Miliband in the first eleven, Labour is Man United without Rooney, City without Yaya Toure.

However they do it, Labour must persuade David Miliband to put his personal feelings aside and take a frontline role if they are to have any chance of returning to government next time around.

Not for the first time a UK government and Prime minister chose political expediency over the national interest this week.

Troubled by back bench rebellions, low poll ratings and a fall out with his Liberal Democrat partners, David Cameron chose to reshuffle his cabinet pack, rather than tackle the much more worrying issue as far as the country is concerned, that of a flat lining economy.

A rethink of economic strategy, which I have been calling for since early 2011, is now desperately required. As I have consistently pointed out, this recession is like no other in that it is both global and deep. The idea that old political dogmas can be used as remedies for very new and different problems is a mistake the chancellor has made, but will not admit.

Similarly, it would be wrong to believe that spending our way out of trouble is the answer, but a sustained period of the austere measures the coalition has in store for the next three years will simply see the country borrowing more as the tax take declines.

A combination of strategic spending on the likes of housing, roads and other infrastructure projects, and a more flexible and targeted public sector cuts programme has to be considered. This more balanced approach is what the government must embark upon if they are to regain credibility and confidence.

The idea that making it easier for us all to build a ‘lean to’ or a conservatory is going to kick start the economy would be funny if it had come from anyone other than the Prime Minister. If this is his ‘big idea’ then lord help us all.

Cameron is not the first Prime Minister to put party politics before the country’s needs. John Major put up with the destabilising of his government and our relationship with Europe by trying to placate his ‘bastards’ for far too long. Tony Blair allowed an intransigent chancellor to block the transformational changes he wanted to make to our public sector. Both lived to regret their failure to act.

I think Cameron will look back on this week and see it as an opportunity missed. He may have bought some time with his own right wing MP’s, but the general public are not so easily bought. And nor, apparently, is Boris!

Earlier this year I predicted that the Tories would win an outright victory at the next General Election. The austerity programme that had been outlined by the coalition appeared to be accepted wisdom from the vast majority in the country, David Cameron had put his foot down with our European partners, and the leader of the opposition was performing like Wayne Rooney in an international tournament.

Fast forward six months, and Ed Miliband must believe that he is back in the game. The UK economy has drifted back into recession. Cameron looks isolated, rather than strong, on the international stage. 99 U-turns since the pasty tax budget have done little for the coalition’s credibility. And the Tory-Liberal Democrat squabbles appear to be getting more regular and far bitterer by the day.

This week, quick on the heels of the Prime Minister’s crass intervention on the personal tax arrangements of Jimmy Carr, the government have found themselves once more lagging behind public opinion, and the opposition, on the LIBOR crisis.

The mistrust of banks is now at an all time high. Whether this is fair or not is beside the point on the political battlefront that is Westminster. People’s instincts tell them that there is something rotten in the higher echelons of our financial institutions. They see their wages being frozen, or in some cases cut, public services being axed, and unemployment figures, particularly among the young, climb to unacceptable levels.

In short, the British people do not see the current ‘arrangements’ as fair. And the British are great believers in fairness.

Cameron may disapprove of the banker’s behaviour in relation to LIBOR, but he fails to demonstrate enough anger, concern and pro-activity in dealing with the problem. 

Miliband, ably supported by Labour rising stars Rachel Reeves and Chuka Umunna, have been quick to call for action, and in the end they may well force a Public Inquiry.

For those who suggest that there is danger in this for Labour, as the last government were at least partly culpable for the problems that are now emerging, is to miss the point. Like banker’s, politicians are not liked, nor trusted. But when things go wrong, we expect our political leaders to be as determined to uncover the truth as we are. This week, Cameron has just looked like he is protecting his mates. Miliband has been on the front foot, wanting to highlight wrongdoing even if it does mean embarrassing some of his former ministerial colleagues.

Odds are that Cameron will recover before the next election and regain some of the Midas touch that got him through the doors of number ten a little over two years ago. But his chances of winning an overall majority are looking far less likely. 

Apparently the coalition government have made over thirty U-turns on a whole host of issues during the past year, from scrapping the idea of a pasty tax through to abandoning the notion of taxing charitable donations.

As a headline, this doesn’t look good, and it looks particularly shabby against a backdrop of robust statements from the chancellor, the Prime Minister and the Deputy Prime Minister, who have all steadfastly refused to contemplate changing any of their suggested policies – before doing just that.

But rather than condemning our political leaders, perhaps we need to pity them and recognise that, like business, politics is now a very different place to what it was three or four years ago.

The iron lady may have been able to boast with some conviction that ‘the lady’s not for turning’. During her period in office her government had a significant amount of power and influence over the direction of the UK and its economy.

However, globalisation now means that something that happens in Greece can throw George Osborne’s best laid plans into chaos – and he needs to acknowledge this and fast if he is to survive as chancellor.

It is difficult for politicians to do many things, but two in particular. Firstly, to admit a mistake. This, they believe, is a sign of weakness that will undermine the public’s confidence in them. Second, and even more difficult, to admit that whatever they do will have little or no difference on what is happening in the country or the wider world.

Osborne’s austerity programme as presented two years ago may have been the answer. But the economy we are in means that economic strategy must be under review weekly, if not daily, such is the uncertainty and the power of the global market. A policy outlined to tackle economic turmoil in June 2010 was probably out of date by July 2010 – never mind June 2012.

Had the coalition said at the outset that they recognised the changing world order and that they would respond accordingly when they had to do so, then u-turns and changes in policy direction would have been seen as part of the plan, rather than blind panic and political opportunism.

It is not too late for Osborne and Cameron (Clegg is finished). But, they must do the third most difficult thing a politician struggles with. They must trust the voters and be honest with us. The austerity programme must at least be tweaked because of the Euro Zone crisis. And the idea that a business friendly agenda will be adopted whilst Vince Cable is a cabinet member, ironically with responsibility for business is, unfortunately, not an achievable goal.

C’mon Dave and George, be bold. A bit of straight talking can go a long way. Just ask your mate Boris!