Industrial Strategy — House of Lords, 2018-01-08
Topic: Macroeconomics
Jennifer Elizabeth Randerson (Liberal Democrats, Centre to centre-left): My Lords, when I heard that we were to have an industrial strategy, I very much welcomed the news because I felt that it built on foundations laid during the coalition, not least by Vince Cable in his work at the Department for Business, Innovation and Skills, and because industrial strategies—for example, the one produced by the noble Lord, Lord Heseltine—have a good name among business. It was a hint of long-termism in the Government’s view at a time when inevitably, because of the Brexit challenges, the Government were taken up with fighting day-to-day issues However, when I came to read the Industrial Strategy, although it was very thorough in the number of words used to cover it, I felt that it lacked that sense of purpose and unique commitment that Governments must have if a strategy is to be workable in practice—if it is to turn out to be more than, yes, another document The Minister referred in his introduction to the Government’s commitment to new transport technology and to transport and future technology in general, but I am firmly of the view that if we are to heal our broken economy, we need, first, to tackle the problems of today. I make no apology for concentrating in my speech on transport and transport technology, because if we do not get transport infrastructure right, the rest will not follow When I travel abroad, I get an immediate impression when I arrive back on these shores of the intense traffic congestion, outdated infrastructure and sheer unreliability of travelling long distances in the UK, whether by road or rail. My sense chimes with that of other people who have talked to me about this issue—the contrast between Britain and neighbouring countries in the stage we are at in solving these problems. All this fundamentally undermines our economy. To put it right, there are no quick fixes: it requires long-term investment and farsighted political commitment We could argue that we would not be in this Brexit mess if successive Governments had not paid too little attention to areas outside the south-east of England. That lack of attention has gone on for many decades. When you analyse the anti-EU vote of the year before last, you see that the heaviest vote to leave the EU was in those areas where the economy had declined furthest and where people were poorest. That is fundamentally linked with the issue of transport infrastructure. Putting this right depends to a large extent on improving those transport links. Tackling economic imbalances and driving growth more evenly across the whole country will not be simple, and I see nothing in the Government’s industrial strategy to convince me that they accept the radical challenge that they face or the amount of money that it will cost to fix it. It is important to remember that our transport infrastructure has relied over many decades on EU regeneration funding. It is important that the Government urgently reassure local authorities and businesses that there will be a firm and reliable replacement for that funding, and how it will be provided I would argue that there is a need for a number of things. First, we need close working relationships with local authorities, which have too often been seen by the Government almost as competitors, with a lack of trust. They obviously hold a key role in terms of planning and infrastructure development. The issue of devolution, which I welcomed strongly, has been linked by the Government to the existence of mayoral authorities. I have never understood why elected mayors are regarded as the key to all political problems and why other authorities cannot be treated on a par. There is a key role on these issues for universities and, of course, business. The Government have to develop real and trusted partnerships with universities as a source of inspiration and research that provides skills for the future and a real partnership with business Then, of course, there is the unsolved problem of how to deal with the free movement of people in the future, on which our economy has relied for hundreds of years. The Local Government Association calculated that by 2024 we will have 4 million too few highly skilled workers in comparison with our needs. That is equivalent to affecting 4% of economic growth. That skills gap must be dealt with in one way or another. I welcome the Government’s commitment to increasing the national productivity investment fund to £31 billion, but I fear that even that will not be adequate. I welcome the Government’s commitment to new technologies in transport as I am an enthusiast for new technologies. I welcome their comments on developing electric vehicles and their take-up, but I looked in vain for the clarity that we need on the long-term issues in relation to this. For example, how will the recharging of electric vehicles be provided in a way that works within the market? It is one thing to say that all local authorities will set up charging points but another to ensure that they are maintained properly. The devil is in the detail I fear that if too much funding is going into local infrastructure projects that are reliant on short-term competitive funding, we will not get certainty for the future of transport investment. In England, 97% of roads are classified as local roads, so the Government deal with a very small percentage of the total. Local roads suffer from terrible congestion as much as the long-distance links There is a massive maintenance backlog on our roads in general, but it amounts to £12 billion worth on our local roads. We need a much more coherent, co-ordinated and cohesive approach to maintaining and developing our roads. There is, of course, an urgent need for investment in public transport infrastructure to reduce air pollution. The Liberal Democrats always prefer rail and road public transport to be developed rather than private transport because of air pollution. However, the Government have not yet produced any adequate detailed plans on how to tackle the air pollution problems As a Liberal Democrat, I looked for something very ambitious in the Secretary of State’s railways strategy; instead, I saw a miserable lack of ambition. The decision to abandon the electrification of the Great Western line beyond Cardiff and the trans-Pennine line sends the wrong message if we are to solve the problem of overcrowded railways. Last week’s 3.4% increase in rail fares did not send out the message that the Government are committed to improving the country’s transport and linking up our cities. We need HS2 but it should not soak up all the investment; it should be just one part of the jigsaw. We need a much more ambitious approach to bus services. There is a dwindling number of bus services, especially in rural areas, which leads to increased congestion. There is the danger that the Government’s announcement on clean air zones might drive buses off the road as local authorities choose to impose much higher standards on buses than on cars in this respect. However, buses are the solution to the transport problem Finally, the challenge the Government face is that the industrial strategy, if it is to work, needs to face up to the fact that after Brexit we will need more than fine ambitions. We need to look at the reality—namely, we cannot lead the world in new technologies by tinkering at the edges and spraying around a handful of pilot projects, sprinkled with a little seed corn money. We cannot be a world leader in this field simply by constantly claiming that we are already, as we hear so often from this Government. We cannot be a world leader by cutting ourselves off from our main market within the EU and discouraging the skills and the immigrants who bring them, on whom we have relied for so long. I do not see in this industrial strategy the answers to those serious challenges that our country faces at this time.