Andy Street: The Commonwealth Games will leave a Levelling Up legacy for the West Midlands

22 Mar

Andy Street is Mayor of the West Midlands, and is a former Managing Director of John Lewis.

The countdown is almost over. Just 129 days remain until the Commonwealth Games begin in Birmingham. Across the globe, 72 nations will send teams to compete in the UK’s second biggest ever sporting event. More than 5000 athletes are taking part in 283 events across 20 sports. Those talented individuals are finishing their personal preparations, with their sights set on gold.

As the final touches are applied to the venues, with excitement building for the Queen’s Baton Relay’s arrival, we in the West Midlands are working hard to ensure that the region’s businesses are also match fit. We want to take full advantage of the huge opportunities the Games are bringing.

I’m proud to have played my part in securing the Games early in my Mayoralty. The people of the West Midlands are embracing the opportunity of hosting such a massive event. I’m proud that successive Conservative Governments – first with Theresa May and Philip Hammond’s support and now with the Boris Johnson’s – has made it happen.

Our Government-backed strategic approach has been preparing the ground to ensure that, alongside a wonderful sporting spectacle, the Games also delivers an economic legacy that benefits local people in future decades.

Central to this is a £24million Business and Tourism Programme, built around four key objectives – creating a resilient and diverse economy, shaping the region’s reputation and profile , generating jobs, and positioning the West Midlands as an epicentre for Net Zero ambitions. Crucially, built into this strategy are ways to evaluate its progress, from the immediate benefits of engagement with investors to medium-term goals to shift international perceptions of our region.

Ultimately, we want to see not only investment and tourism that drives jobs and growth, but also export opportunities for local businesses, and to attract further major events. While it is early days – the Programme runs until 2023 – there are already encouraging indicators that it is delivering against the targets we set.

We have landed two more major events. During the Games, the first ever Commonwealth eSports Championships will be held at Birmingham’s International Convention Centre, giving out medals to the best in virtual sport. Then, in 2026, our region will host a world conference on Women in Sport. This is apt: the upcoming Games will be the first to offer more medal-winning opportunities for women than men.

Early signs also show that hard work to bring inward investment on the back of the Games is bearing fruit, with the strategy targeting markets in places like Australia, India, Malaysia and Singapore. This goes hand-in-hand with our push to shift perceptions of the West Midlands.

The West Midlands Growth Company, which, along with the Department of International Trade and VisitEngland, has reported an 817% increase in traffic to its inward investment website from India in the last six months. More than 640 media hits have been secured in primary markets of India, Australia, Canada, Malaysia and Singapore, spreading the word about our ambitions.

Regarding trade, DIT figures show 293 unique businesses have been engaged so far. Central to this has been a clever link-up with the Queen’s Baton Relay. As the Baton has journeyed across the Commonwealth towards England, we have delivered a targeted sales mission for each milestone, including one-to-one investor meetings and seminars

There are also the economic benefits that the Games’ exposure brings us, alongside the visitors. Birmingham is truly a global city, with people from over 180 countries. We have tried to shape this summer’s event as the ‘Games for Everyone’. The world is coming to us, with 1.5 billion people estimated to tune in globally, and huge numbers of visitors expected. So, the programme helps our businesses prepare to exploit this spotlight.  Our Getting Ready for the Games scheme supplies an e-Learning course to 7,000 businesses, providing insight and information to ensure the region delivers an outstanding visitor experience and showcases the West Midlands’ best.

Finally, the Global Growth Programme provides free support for companies wishing to enter UK markets via the West Midlands, while selecting 25 local businesses for targeted help in boosting exports. The exposure provided by the Games is proving to be a powerful conduit for trade. All of these economic benefits come in addition to more than a billion pounds of inward investment in preparing for the Games. Procurement has ensured that 70% of contracts have gone to businesses with West Midlands bases.

Training has also been boosted during preparations. For example, bootcamps organised though our Skills Academy to train people in broadcasting for the Games has given them skills for life. It’s my hope that many will look back and say that the Commonwealth Games in Birmingham provided them with a life-changing opportunity. All of this should translate into jobs, starting with 35,000 projected across the city this summer.

Along with the investment we have seen in our transport system, housing, skills and town centres, the Commonwealth Games has provided another powerful tool in ‘levelling up’ the West Midlands, backed by successive Conservative Prime Ministers.

We have anticipated this summer for a very long time, and we are ready for the world’s eyes to fall on us. The indications are that the Games will still be benefitting the people of the West Midlands economically long after the medals have been handed out.

Richard John: Monmouthshire is leading the way in delivering high quality public services

18 Mar

Cllr Richard John is the Leader of Monmouthshire County Council and a councillor for the Mitchel Troy Ward.

In a quiet and largely rural corner of Wales, the flame of a compassionate Conservative vision for Wales burns brightly. At the last local elections in 2017, Monmouthshire went from no overall control to become the only Conservative controlled council in Wales with 25 Conservative members, 10 Labour, five independent and three Liberal Democrats.

We are the lowest funded council in Wales because the Welsh Government’s funding formula fails to adequately recognise the additional costs and challenges associated with delivering services in a large rural area. But we have not let this hold us back. Monmouthshire receives just £1,176 per head of population, yet some neighbouring urban councils receive as much as £1,881 per head. If we were funded at the Welsh average, we would receive an extra £40million every year.

Despite these challenges, we deliver high quality public services at the forefront of innovation. We set up an investment portfolio both as an income stream and a policy lever and despite the uncertainty of the pandemic, it continues to return a surplus which directly funds frontline services. We purchased Newport Leisure Park in Spytty with £21million of borrowing. The rental income minus interest payments has delivered up to £500,000 a year to help fund core services. We’ve also used our investment portfolio to secure benefits for our communities even in areas that aren’t the responsibility of local government. We agreed a £2million investment with broadband provider Broadway, which has enabled them to put in place a fibre rollout plan to 17,000 Monmouthshire properties, which would not otherwise have access to high-speed internet.

The pandemic has demonstrated the importance of individuals and councils taking greater responsibility for mental and physical wellbeing. We decided not to transfer our leisure services into a trust, but to reform in-house. While some Welsh councils have struggled with plans to close leisure centres, our approach has been more commercial – to modernise our sites so they’re more financially sustainable. Monmouth was the first leisure centre we refurbished with a brand new gym, dance and spin studios, new kit, a 25m pool with spa facilities, a three storey soft play area with an open plan café and a beauty salon. Until it was forced to close due to the pandemic, the site was returning a small surplus, which is unheard of for council-run leisure centres.

This commercial approach lends itself to a close working relationship with chambers of commerce in our towns. We have a business resilience forum to ensure a close working relationship between our Sara Jones, Deputy Leader and Economy Cabinet Member, her officers and business owners across the county. Through the pandemic, this close working relationship has enabled us to better respond to the challenges facing our high streets. During the pandemic we distributed £41million of Covid grants and got the money to businesses before we even received it ourselves because we recognised that cash flow was a more serious concern for businesses than for us.

In social care, we’ve won awards for the innovative approach we’ve taken to help older people retain their independence through community-based services, which are focussed on the individual rather than an institution. This approach has enabled hundreds of older people to have their care needs met in their own home, where they can continue to live independently. We’re also one of the very few councils in Wales to pay our carers a starting salary £1 above the real living wage.

Our overriding priority has been to offer children and young people the best possible start in life and accordingly, education has been our top budgetary priority for both revenue and capital spend. We’re working with Welsh Government to build new state of the art new schools, having recently completed two new secondary schools in Monmouth and Caldicot and a new school in development in Abergavenny. Although an anglicised part of Wales, we’re ensuring parents have a meaningful choice in education between English and Welsh-medium schools by doubling capacity over the next decade. Our school system is in a strong place as one of the few authorities in Wales with no schools under monitoring by the schools inspectorate Estyn and no schools in a red category under the Welsh Government’s most recent categorisation of schools. We’ve also set up an innovative scheme with the Compass for Life Foundation to mentor primary school pupils from more deprived backgrounds to focus on their dreams and aspirations because there’s nothing as powerful as ambition for the future.

We’re also at the forefront of the green agenda with bold ambitions to improve the connectivity between our towns and villages for cyclists and pedestrians as well as motorists. Working with Welsh Government, this year we’re rolling out more 20mph zones than anywhere else in Wales to improve air quality and road safety. We have one of the highest recycling rates in Wales and we’re decarbonising our fleet with investment in electric and hydrogen vehicles.

Monmouthshire is strategically the best placed county in Wales for growth and our local economy performs second only to Wales’ capital city. Our towns are often considered some of the best places to live in Wales and ranked amongst the best in the UK.  We play a full role in the Cardiff Capital Region and the Western Gateway, keen to secure the economic benefits of partnership working for our residents. We still have challenges of inequality both within and between our communities and we welcome the decision of UK Government to work directly with councils on levelling up and shared prosperity funding to continue to tackle this because nothing is as strong as local knowledge and trusted relationships.

We are doing well, but we are ambitious for more. With continued Conservative leadership, a shared vision and a sense of urgency to deliver for our residents, we can make our county an even better place to live, work and visit.

John Redwood: My critique of the Chancellor’s Mais Lecture, and what the Government should do next

7 Mar

Sir John Redwood is MP for Wokingham, and is a former Secretary of State for Wales.

Amidst all the harrowing reports from Ukraine and the deaths and destruction wrought there by Russia, the Chancellor has sought to chart a course for the economy for the next couple of years.

In his Mais lecture he echoed his predecessor, Philip Hammond, in seeking a productivity breakthrough. He also reaffirmed the Maastricht rules approach to economic management, wanting tax rises to get the deficit down first. The Treasury should note that its role model the EU has abandoned these rules for the time being, and is pursuing monetary and fiscal expansion.

The lecture was wrong to deny that lower tax rates can bring in more revenues. The Republic of Ireland has been a shining example of this, boosting its per capita GDP far higher than ours or the lower level of the  EU by attracting huge investments through a 12.5 per cent Corporation Tax rate.

Their business taxes offer a higher percentage of total tax take than our higher rates. The Chancellor ignores the findings of Margaret Thatcher and Nigel Lawson who he praises. They produced a surge in revenues from higher paid people by major cuts in income tax rates.

The Government should take the cost of living crisis more seriously. In accordance with the Mais lecture, it needs to create the conditions for private sector investment in creating more better-paid jobs and in producing more of the goods and services we need at home.

Levelling up needs to be private sector led, and offer people the chance to set up and run their own businesses, be trained for better paid employment, and find ladders of opportunity in the areas attracting the projects and businesses.

The Government should not take the fast growth rate of 2021 for granted. It was a one-off based on removing Covid restrictions and on an unprecedented injection of money by the Treasury and the Bank of England. In the end, they overdid it in scale and duration, triggering a nasty inflation. The new investment has to take place against a less supportive public sector background.

The rise of prices well above wages will cut growth, as people spend more of their money on such basics as food and energy. That will leave them with less to spend on leisure and pleasure – on items that are nice to have. The huge rise in energy bills alongside tax rises including National Insurance will sap spending power further. The economy will slow. The lecture did not tell us how the extra private sector investment will be attracted in these conditions, particularly with the planned rises in Corporation Tax to come.

These troubles will be compounded by the Government’s import promotion policies, which are most pronounced in the Business and Agriculture departments. Business is busy allowing the rundown of big energy using manufacture like steel, ceramics, aluminium, and glass in the name of Net Zero.

The trouble is that we then import the products from abroad, meaning that more C02 is created in their production and transport to us. The Business Department is busy reducing our oil and gas output so that we need to import more energy. Again, this adds to our CO2 production worldwide.The Environment Department is developing big subsidy incentives to remove land from food production and to encourage older farmers to give up. That will make us more dependent on imported food.

So why does the Government not like products made or grown at home? Why doesn’t it want more home output to boost jobs, incomes and lifestyles? Any sensible programme of levelling up should be cutting taxes and making it easier for local businesses and farms to set up and grow.

This year, revenues have come in much higher than the Budget forecast, thanks to higher growth – and way higher than the £12 billion that the Government says it needs for a tax rise. The Treasury did not put up rates of tax, so revenue grew. During the next financial year, higher tax rates and frozen starting levels will hit taxpayers hard. Revenue is likely to underperform as growth stutters.

An energy shortage is a big part of the problem. The government should ease the shortages of gas, oil and electricity. They should invite in the oil and gas producers in the U.K. and help them increase production straight away from current fields. They should offer licences for new production from all those new and extended fields that have already been discovered. That’s more jobs, better paid jobs, and plenty of extra tax revenue. It is also less CO2 generated globally, as our own gas produces under half the CO2 of imported LNG gas. We will have much more productive industry if we have cheap or competitive energy.

The Government should work with the electricity industry to keep the lights on. We  will need more capacity than is planned to cover the electric revolution. We need more power for when the wind does not blow and the sun does not shine. We should abandon the current policy of putting in more and more interconnectors to allow us to import more from an energy short continent.  They should produce schemes to promote more home-grown food.

Johnny Thalassites: Cafe society is here to stay in Kensington and Chelsea

4 Mar

Cllr Johnny Thalassites is the Cabinet Member for Planning, Place and the Environment on Kensington and Chelsea Council.

The outdoor cafe culture that has sprung up during the pandemic is set to stay in Kensington and Chelsea. We are proud to become the first place to commit to new local policies to make al fresco dining an ongoing attraction across our borough.

From Sloane Square to Westbourne Grove, and from Bute Street to Golborne Road, businesses will be able to continue offering outdoor dining after temporary national legislation ends in 2022. Our new policy will see businesses offered licenses to operate from March to October, in line with British Summer Time. New licenses make it easier to trade on pavements, suspended parking bays, and pedestrianized streets. They may also be granted for up to five years.

The standard conditions associated with new licenses include commentary on the visual appearance of new terraces (all sides of new terraces must be open above waist height, not blocking shopfront views), on management and operational matters (structures must be demountable, so as not to frustrate essential highway maintenance; there must be consideration of minimum footway widths and accessibility; and waste management plans must be agreed), as well as regular operating hours (8am-10pm; 8am-8pm on Sundays).

New licenses must also contribute towards the borough’s air quality and climate emergency goals. We require applicants to include new greenery in site plans, and we will accept neither plastic and/or perspex, nor electric heaters. Adjusting our long-term policy around licensing means we can take successful interventions from the pandemic forward to benefit our businesses, residents, and visitors. More people visit Kensington and Chelsea every day than any other borough or district in the country, and we want to enhance our status as a place of culture to visit and explore.

This policy gives certainty to business, residents and visitors. Individual applications made by businesses are assessed on a case-by-case basis against guidance and conditions. Good operators will win new customers. Bad operators may have licenses refused, reviewed, or revoked, if local people identify persistent breaches of guidance or conditions.

As we do not know the contours of Government’s post Covid-19 approach to outdoor dining, the policy framework applies to the existing planning, licensing and street-trading regimes. It also features in the Council’s draft New Local Plan, so as to become a material consideration at committee hearings. But we are confident its principles can be applied to a fast-changing national context.

Since the start of the pandemic, the Council has granted 114 outdoor licenses on temporary footway extensions and more than 450 pavement licenses in streets and public spaces. Some residents may have feared poor quality terraces and antisocial behaviour would plague new street structures. In a minority of cases, they have been right and we have refused applications. Indeed, we know street closures to support the hospitality sector have presented challenges in some places. For example – motor traffic has been reintroduced and al fresco dining rolled back somewhat from its pandemic-era high-watermark in Soho, just over our eastern boundary in Westminster.

However, a large majority of residents in our central London borough – the capital’s smallest and one of its most densely populated – have embraced the changes. 74 per cent of residents polled in our (demographically weighted) Citizen’s Panel supported making outdoor dining permanent. Around 70 per cent of respondents backed our plan in a recent formal consultation. And local people have been voting with their feet: you have to book early to get an al fresco table on newly pedestrianized streets – such as Portobello, home to a world-famous market, and Pavilion Road.

Although the past two years have brought about many challenges, there have been some unique opportunities to look at new ways of utilizing our high streets and supporting local business. The introduction of pavement licenses in the borough has been examined by researchers at the Centre for London, whose work has helped to inform our approach. Nearly three-quarters of residents in Kensington and Chelsea live within 200 meters of a high street – and the importance of local centres has been brought into sharp focus by the pandemic.

Now our goal is for high-quality public realm interventions to follow the new al fresco dining policy, so that we produce healthy and vibrant places. It is our job to consider the longer-term trends that will change people’s habits, many of them accelerated by Covid-19.  The Council recently launched a public realm design competition to improve Notting Hill Gate. Place-shaping schemes have been approved at Chelsea Green and St. Helen’s Gardens, involving single-surface feature paving, more greenery, and new tree-planting. A Placeshaping Investment Strategy will follow.

Seeing our streets buzzing with people enjoying our world-class bars and restaurants has been a real positive during a difficult couple of years. We want it to be a lasting legacy following the pandemic.

It’s a no-brainer to keep outdoor licensing on the menu when it’s proven so popular with restaurants, residents, and visitors. This is a way to support our businesses to get back on their feet, whilst adding to Kensington and Chelsea’s reputation as a destination.

David Gauke: Sunak’s big speech. Intended to move on from crisis management. Made just as there is a new crisis to manage.

28 Feb

David Gauke is a former Justice Secretary, and was an independent candidate in South-West Hertfordshire at the 2019 general election.

Imagine, for a moment, being Rishi Sunak. One day you went to work as Chief Secretary to the Treasury expecting a routine working day. By lunchtime, you had become Chancellor of the Exchequer and had to deliver a Budget in six weeks’ time. At this point, you were aware of concerns about a new virus, but had little idea what an extraordinary impact this was going to have on society and the economy, and how it was going to dominate your first two years in office.

The challenges you faced were immense but, by and large, the consensus is that you handled this period of crisis management with some aplomb. Even when you got things wrong (opposing restrictions in autumn 2020) this has not done you much damage, and the polling suggests that you are the most popular politician in the country. There is even a very good chance that you could become Prime Minister within a few months.

The worst effects of Covid-19 appear to be behind us, and you can now focus on the simple matters of being Chancellor and becoming Prime Minister. There is even a big speech to deliver which will give you an opportunity to set out your thinking on the economy.

And then Putin orders Russian troops to invade Ukraine.

One relatively small consequence of this action was that the Chancellor’s Mais Lecture on Thursday attracted little attention. It also meant that the lecture had little to say about the economic issue of the day – what are the consequences for the economy of Russia’s invasion of Ukraine and our response to it.

The invasion of Ukraine is an era-defining moment not just geopolitically but also economically.

At a time of already high energy costs, we are seeing an oil price shock that is drawing comparisons with 1973. This means that inflation will peak at an even higher level and the squeeze on living standards will be all the greater.

There is rightly a consensus that economic sanctions must be powerful enough to hobble Russia’s ability to wage war on its neighbours. We should not kid ourselves, however, that sanctions will be immediately effective or painless for us. Our objective with Russia must be the removal from office of Vladimir Putin, but sanctions – if they are to have any effect at all – are only likely to do so over time. (The most important factor in removing Putin is the effectiveness of the Ukrainians in resisting the Russians and, specifically and bluntly, inflicting casualties on the invading forces.)

Reducing trade and interaction between Russia and the West has negative consequences for both sides. It will be worse for Russia than the West as a whole because the West has a much bigger economy (size matters when it comes to trade disputes as we should all know from another context), but there will be damage to the UK economy from, for example, Russia’s exclusion from SWIFT.

The cost of living squeeze and the cost of sanctions will all add to economic uncertainty which may damage economic confidence. This will likely feed through to economic growth over the next few months.

Lower economic growth will mean lower tax receipts, whilst pressures on public spending on measures to mitigate cost of living pressures or increase defence spending will be immense. We may also have to accelerate investment on energy generation. The chances were that the Office for Budget Responsibility was going to have good news on the state of the public finances when it sets out its next forecasts on 23 March, but that is now less certain, even before we see higher spending plans announced.

It is a gloomy prognosis, and there must be some concern within Government that the public has not yet understood that the appalling events in Ukraine will have real consequences for the British people, and that this is not a short term issue. The likely outcome is still that Russia will conquer Ukraine but that, over a period of years, the Ukrainian people will make it impossible for the Russians to continue to occupy it. That, combined with the long term impacts of sanctions, will force Putin out. It may take years, as Liz Truss rightly warned yesterday.

There is a lot to digest and, unsurprisingly, Sunak’s lecture – delivered hours after the invasion – does not attempt to do so. It was a speech that was designed to move on from crisis management and address the long term challenges of the UK economy. The irony is that he delivered it on the day that it became clear that crisis management was, once again, going to be the order of the day.

This is a pity on many levels. It was a serious and thoughtful speech and had much to commend it. The politics of it are also interesting.

To the extent there has been much pick up, it was on Sunak’s remarks about tax. This was an unashamedly fiscally conservative speech arguing that tax cuts can only be delivered when there is fiscal space for it. He corrects the mythology of the Thatcher years in pointing out that taxes were only cut in the 1980s when it was affordable and that, in 1981, taxes went up. The lazy thinking that cutting taxes automatically pays for itself was rightly dismissed.

If there is a leadership campaign in the next few months, this argument will be important. It is more than likely that other candidates will make lower taxes part of their platform and there is already talk of an “axe Rishi’s tax” campaign from Liz Truss. The Chancellor is doubling down on his position. He is right but there are risks for him in defending a tax increase whilst running for the Tory leadership.

He also sets out a moderate and pragmatic argument about the role of the state. He praises the market and the sets out the limits of what the state can do but also recognises the areas where state intervention is necessary. He makes the case for a contraction in the size of the state but also acknowledges the demographic challenges that stand in the way.

He raises the question of how we increase productivity and makes the case that the key considerations are capital, people and ideas. This is the right question and these are the right factors, even if there are criticisms that can be made of the Government’s approach.

On business investment, Sunak rather brushes away the impact of Brexit (he says that ‘the cloud is lifting’ of Brexit uncertainty but that is not entirely true and some of the damage done to business investment due to Brexit will be permanent) and I still hold the unfashionable view that increasing corporation tax rates is a retrograde move.

On innovation, we should exploit the fact that we have two of the world’s greatest research universities with booming technology sectors located near them and have ambitious plans for the Oxford-Cambridge arc. Sunak refers to his experience of living in Silicon Valley and we could have our own version. Instead, we are dropping these plans to focus on levelling up other regions. Politics is trumping economics.

These criticisms should not obscure the overall assessment of a speech which reveals a little more about what kind of Chancellor of the Exchequer he would be in normal times. Unfortunately for us all, including Rishi Sunak, we are not going to be in normal times for some little while.

Liam Fox: Spurred by industry expertise, the Government is ready to unleash the power of Global Britain

11 Feb

The Rt Hon Dr Liam Fox MP is former Defence and International Trade Secretary. He was the UK’s Nominee to be Director-General of the World Trade Organization (WTO) in 2020

When the Global Britain Commission was launched last October, its purpose was clear. Utilising the expertise of British business leaders, the Commission was designed to offer a dialogue between business and government about how a truly Global Britain can be achieved, supporting growth and providing the high value jobs on which our prosperity is dependent as a result.

Such a purpose encompasses working with the Government to define, shape, and make a reality of Global Britain, drawing on the experience, reach and expertise of the businesses involved to do so and thereby support the Government in creating a blueprint for making the most of global economic opportunities. After all, government does not create jobs or prosperity but can set the framework in which businesses can do so.

Fast-forward four months and, with the Commission releasing its first of three reports today, initial steps have been taken to achieve these aims. The report, focusing on what Global Britain means to business and what businesses understand by the idea, also reaffirms why this policy is so fundamental to the future of the UK, both on a domestic and global level.

Post-Brexit, there is a new trading reality, and British and global businesses can grasp these new opportunities to penetrate new markets to the benefit of the economy, business and workers. However, our future trading relationships, now that we have left the EU, will only succeed if business and the Government work together to deliver for British interests around the world. As the UK also recovers from the Covid-19 pandemic, now is therefore the time to focus on our strengths and comparative advantages to ensure maximum returns for the UK in the future.

Moreover, there is space for British business to innovate and lead the world in particular industries. For example, with the Government viewing its business goals and its target of Net Zero by 2050 as intertwined, British businesses can be at the forefront of a Green Industrial Revolution, exporting its products globally and leading other countries in the battle against climate change (just as we did at COP26). Tom Samson, CEO of Rolls-Royce SMR, reaffirms this point in the report when he states that “the global decarbonisation challenge presents an unprecedented opportunity for the UK to bring leading new clean energy technologies to the world stage.”

The Global Britain policy is also vitally important because of the increased amount of debt caused by the pandemic, coupled with the recent rise in inflation. With costs rising faster than wages, inflation always hits the poorest in society the hardest. Naturally, one key way to combat this is to create more secure and better paid jobs, something that will be done through penetrating new and emerging markets for the export of British products. A key focus of the Commission – increasing British exports – will see tax receipts rise and debt decrease, ensuring we do not pass on this mounting problem to future generations.

Furthermore, the fact that global trade was shrinking before the pandemic should raise alarm bells; protectionism, especially among the wealthiest countries, does no favours for anyone. Thus, it must be tackled with a healthy dose of British free trade enthusiasm and the willingness to work with like-minded partners. If we are to enable developing countries to trade their way out of poverty, open markets with appropriate investment strategies by government and business will again be crucial.

The Government therefore needs the very best advice from leaders in British industry which, in turn, will combine their unrivalled knowledge of the UK and global business to establish how best to harness and deliver a more resilient economy that creates jobs and levels up Britain. In the most part, this will involve turbocharging British exports, with the Global Britain Commission focused on how we as a country can maximise the exports of the products and services that we excel in, how we turn the UK’s ability to make products into selling and making money for the UK, and how we put political might behind British business and products to champion both at home and abroad.

To businesses, Global Britain means all these points and more. Fundamentally, it is about openness, international connectivity, encouraging greater investment into the UK, promoting innovation, productivity and skills, and creating opportunity equally throughout the nation.

Were all this to be achieved, the benefits to Britain would be clear. Raising per capita exports of goods and services to the level of Germany, for example, would generate an additional £474 billion of UK exports annually. This £474 billion export boost could then create up to 5.5 million export-supporting jobs, of which are seven per cent higher paying than the UK average.

Backed by business leaders and this data, the Global Britain policy therefore represents a real opportunity to do things better, more efficiently, more strategically, and to tailor our economy to our strengths as a nation as well as ensuring that we create prosperity across the UK, especially for those who need it most.

Working with the Government, the right focus on a truly global Britain can thus reap huge economic benefits for everyone in the UK.

You can read the full report on the Global Britain Commission website here.

Stephen Booth: The Government’s regulatory reform plans. We know a lot about the principles…but not much about the practice.

10 Feb

Stephen Booth is Head of the Britain in the World Project at Policy Exchange.

Regulatory reform tends to receive far less attention than government policies on taxation and spending, but it is just as vital to the UK’s economic success and the country’s post-Brexit future.

Last week, the Government published The Benefits of Brexit: how the UK is taking advantage of leaving the EU to mark the second anniversary of the UK’s withdrawal from the EU. The document sets out how the Government is using post-Brexit freedoms to implement new policies in different sectors. From immigration to trade, and agricultural policy to government subsidies.

The White Paper also identifies future opportunities to develop distinct post-Brexit regulatory and policy approaches across a range of headings including: science, data, and technology; business and industry; infrastructure and levelling up; climate, the environment and agriculture; and Global Britain. Many of the opportunities identified correspond to those outlined in last year’s Policy Exchange report Post-Brexit freedoms and opportunities for the UK.

Critics have a point when they note that, so far, the Government’s rhetoric has been appreciably more ambitious than its actions. Regulatory reform is complex and individual reforms, be it to data protection or agricultural land management, are always likely to be politically contested.

Fundamental changes require a strong political focus because there are inevitably tensions between industry, consumers, government, and regulators. The pandemic and the fraught negotiations over the Northern Ireland Protocol have understandably used up much of the political oxygen and impetus required to drive changes through.

For example, in the financial services sector, reforming the Solvency II regime for insurance regulation has long been seen as an opportunity to diverge from EU rules for competitive advantage and to free up more capital to invest in long-term infrastructure projects.

However, the industry has warned that the Treasury and the independent regulator have been pulling in different directions. There is a risk that the UK ends up being less ambitious and less competitive than the EU, which is pursuing its own reforms of the rules.

Aside from individual rules, the major post-Brexit opportunity is to improve how the UK regulates, through reforms to the wider regulatory regime. This includes looking at the relationships between industry, customers, elected politicians and regulators. The impact of regulation on the UK’s global competitiveness is another crucial factor.  For example, the Treasury has proposed giving the UK’s financial regulators a greater focus on growth and competitiveness in new statutory objectives.

Systemic and cultural change takes time. However, the prize on offer is a regulatory system that is more –

  • Agile and dynamic, allowing regulators to act quickly and decisively, as we saw in the development and authorisation of covid vaccines;
  • Proportionate, sensibly weighing consumer/citizens’ welfare against innovation and investment;
  • Responsive and accountable to UK interests, without the need for qualified majority voting among EU nations or co-decision with the European Parliament.
  • Focused on the challenges and opportunities of the future, on new technologies and new consumer realities.

The Benefits of Brexit paper provides the Government’s response to a wide-ranging consultation on reforming the better regulation frameworkand sets out five new regulatory principles to make the UK the “best regulated economy in the world”.

There are several welcome statements of intent outlined under these principles: regulating only where absolutely necessary, ensuring regulators have the right powers and duties, working more collaboratively with businesses to ensure there is a clear feedback loop between the regulated and the regulators, a target to cut the cost of EU inherited red tape, and a greater focus on reviewing the real-world impact of regulation that has been implemented.

However, there is little detail about how the Government intends to put these principles into practice. Ministers announced over a year ago that the current Business Impact Target, which measures the costs of regulation to business, would be replaced. But we still have little sense of what the new system to measure the impact of regulation will be.

Meanwhile, the White Paper’s £1 billion target to reduce the costs of inherited EU red tape to business appears relatively unambitious. But the real problem with such a target is that there is no agreed baseline of total regulatory costs against which to even assess the level of ambition. Last year’s consultation raised the prospect of measuring and baselining the total regulatory burden in the UK, as Canada, Denmark and the Netherlands have done, but there is no mention of such an exercise in last week’s White Paper.

The Government has also ruled out a return to the ‘one-in, two-out’ policy adopted by previous governments. The case for such a regime is that it enforces regulatory discipline by requiring departments to identify regulatory savings before introducing new rules.

However, it can also be argued that ‘one in, two out’ is a blunt instrument. Poor regulation should be identified and amended or repealed as a matter of course, rather than overlooked or deliberately kept until an offset for a new regulation is needed. The central question is how to ensure that departments and regulators are incentivised to routinely root out poor or overly burdensome regulation.

This poses another fundamental question, which is one of political oversight and application. Lord Frost was the driving force for this agenda across government from the Cabinet Office and, in the weeks after his departure, it was unclear where responsibility for regulatory reform would reside. This week Jacob Rees-Mogg has been given the responsibility in a new Cabinet Office role as Minister for Brexit Opportunities and Government Efficiency. Such an agenda requires long-term commitment throughout government and, ultimately, strong support from the Prime Minister.

The Government has set out principles which promise a more coherent and modern regulatory regime. The challenge now is to move from these statements of intent to implementation and tangible reforms. Over the next six months, Policy Exchange’s Re-engineering Regulation Project will take evidence from those in the private and public sector, and provide the concrete policies required to turn such a vision into a reality.

Andrew Griffith: It is ultimately outputs that matter. My priorities as the Prime Minister’s new Director of Policy.

7 Feb

Andrew Griffith is the Prime Minister’s Director of Policy, and is MP for Arundel.

With the benefit of the strong mandate that the Prime Minister obtained at the last general election, and building on the Government’s leadership during the Covid pandemic, the Number Ten Policy Unit has a vital mission to deliver policies that reflect the priorities of people across the UK.

You would not know it from the media headlines, but families want to hear about our plans to grow employment, tackle the NHS backlog, control our borders, make their streets safer, bring down the cost of living and return rapidly to the point when we can cut taxes to let everyone keep more of their own money – all policies that are rooted in strong Conservative values.

As the Prime Minister’s Director of Policy, these are my top priorities together with delivering the tangible opportunities from Brexit that will allow our economy to be more competitive and the reform of government to deliver better public services. Whilst the Policy Unit’s remit is to advise the Prime Minister across the widest breadth of government policy, we will be unafraid to ruthlessly focus on the key issues. It is ultimately outputs that matter.

I bring to the role my personal experience of growing up in the early 1980s, when an unconventional Conservative Prime Minister built an unusually broad coalition of support, secured successive large election majorities, confounded pessimists and radically improved the way that the world and its own citizens perceived Britain. From a comprehensive school in south-east London, I was the first in my family to go to university, where campaigning to keep the UK out of the Exchange Rate Mechanism turned me into a lifelong Conservative.

I stood for election in both the 2001 and 2005 general elections, reducing an initial 12,000 Labour majority. Corby, after the closure of its steelworks, was very much a target ‘red wall’ constituency of its time. It taught me the vital importance of policies being clear, relevant and simple to communicate on the doorstep.

More recently, having entered Parliament from business, I know first-hand that prosperity is created not by government but by the ‘fly wheel’ of enterprise and entrepreneurship creating jobs and providing the tax revenue to finance high quality public services. A competitively regulated, low tax and high skills economy trading globally has always been the right combination for economic success.

As we formulate and deliver policy it is vital that we harness the energy, experience, and insight from Members of Parliament, Parliamentary candidates and supporters, including the readers of ConservativeHome. Our Party represents voters across the whole of the UK and every generation, gender and religion. We have the opportunity to be a ‘hive mind’ of centre-right policy development.

It is important that we do so. In the battle of ideas, we remain an insurgent force: outgunned by the hegemony of left-wing orthodoxy that often lurks without challenge within swathes of the cultural and education establishment and in the state supported media.

One way we will do this is through Sir Graham Brady and the 1922 Executive’s ambition to re-establish backbench policy committees. The Prime Minister and I warmly support this, and we are committed to make them work. Covid has suppressed proper policy discussion for too long – indeed, for the majority of the time that I and my 2019 colleagues have sat in Parliament.

A large majority is a poor substitute for proper engagement between Ministers, Number Ten and backbench colleagues who in many cases possess decades of relevant experience. The 1922 backbench policy committees – one covering each major government department – will form just one part of changes in how a sleeker Number Ten operation engages with Members of Parliament.

Ministers, too, will notice a difference. In today’s complex, competitive and dynamic environment it’s a fallacy to control everything too tightly from the centre. Decisions are usually taken best close to where their impact is felt, and high-performing departments should expect a light touch approach, freeing up bandwidth for deeper interventions elsewhere.

Just as the strongest steel is forged in the hottest fire, constructive engagement makes for good policies that last the test of time and that colleagues can unite around. The things that make the largest differences to the most people tend, by definition, to be challenging. It is not simple to reverse 40 years of EU ‘muscle memory’ overnight as we move to more competitive regulations. We will have to make brave and bold choices as we reform an asylum system that pre-dates the existence of mobile phones and the global internet. Getting Brexit done was not easy. But this is a Government that consistently takes tough decisions. In bringing forward plans to reform social care we have shown the courage to grasp a nettle that our predecessors had long shirked.

This Government has much in its favour. Clear leadership, an ambitious programme and political fuel in the tank in the form of our largest majority since Margaret Thatcher. But the yardstick of long-term political success is real action making a difference to the real experience of electors across the UK.

The British people understand that results take time, particularly as we emerge from an unprecedented global pandemic. So long as they see that we are focussing on them and their needs rather than fighting amongst ourselves, I believe that they will continue to place their trust in us. As I start my role as Policy Director today, it is time for we Conservatives to unite, to support the Prime Minister and to get on with the job.

Tony Danker: Now is the moment for the Government to go for growth

3 Feb

Tony Danker is Director-General of the Confederation of British Industry

For business leaders, the past few weeks have felt like peak politics. But this week has marked a shift back to economics. And it is most welcome.

Yesterday saw the publication of the long-awaited Levelling Up White Paper, with its transformational aspirations. Today there are energy price announcements and an interest rate decision. Economics is coming to the fore once more.

For me, the biggest takeaway from yesterday’s PMQs is that the debate about long term growth has now reached primetime. Here at the CBI, we’ve been banging this drum for a while now. We partnered with the Campaign for Economic Growth at Conservative Party conference back in the Autumn because we wanted the government to focus more on business investment to drive the economy. And today I was joined by the brilliant Robert Colvile from the Centre for Policy Studies at a joint CBI-CPS event to answer the question: are we actually serious about growth?

The UK currently has the fastest growing economy in the G7, but it doesn’t tell the whole story. V-shaped recoveries around black swan events are no time for credit or blame. The downward nosedive is not an accurate judgement of economic performance; and nor is the climb.

The truth of the matter, as set out in black and white by the OBR, is that we’re looking at post-recovery growth of just 1.3-1.7 per cent. For a country that has demonstrated it can do growth at around 2.5 per cent, this is not ambitious enough.

And let’s be honest, without higher, sustainable growth the ambitious, levelling-up goals set out yesterday, from improvements to public services and much more besides, will be all the harder to achieve unless we can get growth going again.

Let’s look a little closer at the bind we’re in – and importantly – how we can escape being caught in a trap.

Lumping more onto the UK’s tax burden – already at the highest sustained level seen in peacetime – cannot be the answer. The evidence is clear that raising taxes stifles growth, and cutting them drives it.

We’re not talking growth at any cost and by any means. And we’ve not lost sight of the need for fiscal responsibility. We’re talking sustainable, long-term growth stemming from greater investment, innovation and productivity.

Just as companies can’t afford not to invest in growth, nor can countries. It’s not just about money – it’s about ambition and imagination too.

And there’s never been a better time to go for growth, because right now we’re at a unique moment: when once-in-a-lifetime events have coalesced to create a burning platform for change.

One of those is Brexit. I am a big believer in the opportunity of post-Brexit Britain. I think it gives us the platform we need to push the UK’s huge economic potential and the freedom to make big bets. It can awake us from the flatlining productivity that took hold after the financial crisis.

Another is the pandemic, which has driven huge acceleration in tech and digital adoption.

And finally, we have the opportunity that flows from our world-leading position on decarbonisation. There is a wall of investment to fund decarbonisation – backed by firms with over $130 trillion in assets. British businesses are begging Conservative politicians to see the enormous economic prizes available go to those who move fast.

All this means this is our moment.

So how do we seize it? By harnessing the creativity and initiative which birthed the Super Deduction, new skills bootcamps and offshore wind investment – measures which spurned orthodoxy in public policy and showcased the boldness and vision we need.

The first step should be a permanent Investment Deduction, succeeding the Super Deduction and mitigating the looming Corporation Tax rise. It would act as a long-term incentive to invest and grow enterprise, with businesses acting across many fronts in service of the nation.

Achieving the Prime Minister’s vision of the UK as a science superpower requires nurturing a workforce fit for the future. So, how about building on the Apprenticeship Levy with a new Skills Challenge Fund to invest in the high-value skills businesses really need.

We also need to get serious now about generating more of the skills we need at home – so we’re less reliant on immigration. Nadhim Zahawi is onto something with his new Unit for Future Skills, examining where skills gaps exist. Let’s supercharge that and build an independent Council for Future Skills. It could optimise training towards future economic demand and recommend visas to overcome shortages in home-grown talent, setting the Shortage Occupation List.

On energy, ending uncertainty on hydrogen and schemes like carbon capture and storage will enable the UK to lead in global green markets.

Meanwhile, let’s build on Monday’s Benefits of Brexit paper by establishing a new Office for Future Regulation to allow a post-Brexit UK to become the smartest and most future-focused regulator in the world, with a clear remit to target competitiveness, investment and innovation.

The focus of this new body should be the big bets for our economy. Set free to be agile, now we are no longer bound by EU-wide consultation and compromise. Proportionate, so that it strikes a better balance between investment and consumer protection. And more dynamic, allowing regulators to act quickly and decisively, as we saw with the vaccine, when the MHRA saw the UK lead worldwide.

This is not all on Government. Business has a key role, and the CBI will be promoting serious growth to firms across the country. We will ask them to increase business investment. In net zero. In innovation and digital transformation. In exports. In skills. In workforce health and wellbeing. And we will gather them in clusters around the country to deliver levelling up the only way it can be done – by the private sector through better skills, jobs and wages.

Business leaders – of all sizes and sectors – will respond because they are serious about growth.

So let’s get serious, together. Let’s unite, creating sustainable growth – the only real answer to our cost-of-living crisis, rising energy prices and high inflation. Growth that propels the UK beyond recovery to a new era of prosperity.

After a disappointing decade for UK investment and productivity, this is our second chance. Let history show that, this time, we seized the moment.

 

Lord Ashcroft: Parties aren’t Johnson’s only problem – his voters are awaiting real, positive change

27 Jan

Lord Ashcroft KCMG PC is a businessman, philanthropist, author and pollster. For information on Lord Ashcroft’s work, visit www.lordashcroft.com

The front page of Wednesday’s Daily Mail bewailed “a nation that’s lost all sense of proportion”. The paper remains a good barometer of opinion for a large chunk of the population, and many people will have nodded with approval at the headline.

The splash cited a political class fretting over the Prime Ministerial birthday cake while Russia prepared for war, but this was not the only incongruity at hand. Readers might also have wondered whether a lengthy investigation into alleged Downing Street parties was the best possible use of the Met’s time, especially given that this news emerged on the day a woman was murdered in broad daylight on a London street by a man who by all accounts ought to have been in its custody.

Perhaps they also considered it curious that the fate of a leader who owed his position to nearly 14 million votes and an 80-seat majority in parliament seemed to depend so heavily on the judgment of a civil servant. If Boris Johnson survives it, the last few weeks might look quite bizarre in retrospect.

But that is not to dismiss the charges against the Prime Minister. Many will be understandably aghast at reports that Johnson and his entourage ignored rules they had imposed on the rest of the country – or, to look at it from the other end of the equation, imposed rules on the country which they themselves evidently considered unnecessary.

Even leaving aside the rights and wrongs, the political blunder is extraordinary: the government otherwise has a reasonably good story to tell on Covid. After one of the most successful vaccination programmes in the world, Britain is the closest of any country in the northern hemisphere to being out of the pandemic, according to Professor David Heymann of the London School of Hygiene and Tropical Medicine (and if that doesn’t sound like something the government should get the credit for, imagine who would be blamed if the opposite were true).

Yet the party saga is only one reason for the slump in public approval for the Prime Minister and his administration.

People’s relief and appreciation for the vaccines translated into double-digit Conservative poll leads that were never likely to last. During the crisis people were willing to suspend judgement and give ministers the benefit of the doubt, but the ebbing tide of the pandemic reveals what else is on the government’s agenda – or rather, what isn’t.

“Get Brexit Done, Unleash Britain’s Potential” was the crisp and effective slogan of 2019. No-one can deny that the first part was achieved in short order. We are still waiting for news on the second.

Things were inevitably derailed by Covid, but the Levelling Up White Paper – promised “later this year” in May 2021 – has yet to appear. The excellent aim of spreading opportunity and prosperity has been the driving force of the most successful Tory governments – promoting home ownership, encouraging new businesses, giving more people the chance to invest in industry, expanding university education and reforming welfare to make work pay all fall under that heading. What it means to Johnson remains an open question.

Meanwhile, we see lavish spending on unreformed public services, higher taxes, and rocketing living costs spurred by the government’s own energy policies. The air of at least comparative competence that traditionally helps keep the Conservatives in office seems to have taken a sabbatical.

All these complaints are real and justified and help explain Johnson’s predicament. But at the same time, it’s important to recognise what isn’t happening. For the Prime Minister’s many detractors, the last few weeks have seemed a vindication. “See? Told you so” has been the theme. But disgruntlement with a leader is not the same thing as wishing you had never voted for him.

Given the choice that was before them, vanishingly few will regret having helped send Johnson to Number 10. Still less will they repudiate the reasons why they did so. They really did want to get Brexit done, whether to see their own referendum vote honoured or to climb from the quagmire that politics had become. For many he represented a view of Britain that they shared, and which was a million miles from that of his opponents (he seemed to like it, for a start). Even Jeremy Hunt, whom I backed for the leadership, has said that only Johnson could have produced the amazing result.

Two years later, as the Prime Minister continues to give his many opponents the ammunition to eject him from office, they would do well to remember how and why he attained it.

Some of them might also reflect that for all their talk of probity in public office the thing they can’t forgive him for is that, by delivering Brexit, Johnson did what he was elected to do. But for his voters, that achievement was banked long ago. If they decide it’s time for him to go, it won’t just be because of warm Chardonnay in the Downing Street garden – it will be because there was so little else to remember.