UKPOL.CO.UK

Blog

  • PRESS RELEASE : £15 million investment in satellite communications from UK Space Agency [October 2022]

    PRESS RELEASE : £15 million investment in satellite communications from UK Space Agency [October 2022]

    The press release issued by the Department for Business, Energy and Industrial Strategy on 17 October 2022.

    Science Minister Nusrat Ghani has unveiled a new £15 million fund for UK businesses to revolutionise satellite communications technology.

    The competition, running until next spring, is open to organisations developing ambitious technologies across the satellite communications ecosystem. It will prioritise customer needs, support sustainable growth and catalyse further investment into the UK space sector, which already employs 47,000 people.

    Ideas can focus on creating entire new satellite constellations, ground systems, or delivering new services to customers, and will be funded through the UK Space Agency’s leading role in the European Space Agency (ESA) Advanced Research in Telecommunications Services (ARTES) programme.

    This new funding package is announced as the Science Minister travels to Rome, Italy, in her first space-focused visit overseas to meet ESA Director General Josef Aschbacher.

    The meeting comes ahead of the ESA Council of Ministers (CMIN22) next month where the UK and other member states will negotiate their future contributions to ESA for priority space projects and missions.

    Science Minister Nusrat Ghani said:

    I am proud to be representing the UK space sector as we discuss our ambitions ahead of the ESA Council of Ministers next month. There are a series of important programmes on the table and I want to harness opportunities in space to grow the UK economy, create jobs and inspire young people into STEM careers.

    We’re also making new funding available now to strengthen the UK’s position as a world leader in the satellite communications market, and I look forward to seeing the results of the competition.

    The £15 million fund comes as a new report shows every £1 invested in ESA generates an overall return of £11.80 for the UK economy.

    The Impact Evaluation of UK Investment in the European Space Agency also shows the UK is in the top three nations in terms of scientific output, with the USA and Germany. This is a measure of the publication rate per every £1 invested among key space-faring countries.

    The UK’s role in ESA is an important part of delivering on the government’s ambitious National Space Strategy. The UK committed £374 million per year over five years to ESA in 2019 and this report looks at the impact of that investment in 2020 and 2021.

    The ARTES programme is one of the UK Space Agency’s key commercial drivers for UK space sector growth and includes projects such as Eurostar Neo. UK involvement, which is expected to bring a 20:1 return on investment, will see new geostationary satellites developed by UK-based Airbus launched into space to provide better broadcast, internet and communications services around the world.

    Dr Paul Bate, Chief Executive of the UK Space Agency, said:

    Our ESA membership delivers huge advantages to the UK, by catalysing investment into the sector, backing innovative companies, and providing access to new missions and capabilities such as the James Webb Space Telescope.

    As a founding member of ESA, UK space organisations benefit from access to world-class facilities in the UK and Europe, the expertise of ESA’s 3,000 staff, and close links to the wider international space community, including other space agencies like NASA.

    This new report demonstrates how our participation in ESA translates into real results for the UK economy and continues to play an important role in meeting our national space ambitions.

  • PRESS RELEASE : Avian influenza – Prevention Zone declared across Great Britain [October 2022]

    PRESS RELEASE : Avian influenza – Prevention Zone declared across Great Britain [October 2022]

    The press release issued by the Department for Environment, Food and Rural Affairs on 17 October 2022.

    Following an increase in the number of detections of avian influenza (bird flu) in wild birds and on commercial premises, the Chief Veterinary Officers from England, Scotland and Wales have declared an Avian Influenza Prevention Zone (AIPZ) across Great Britain to mitigate the risk of the disease spreading amongst poultry and captive birds.

    This means that from midday on Monday 17 October, it will be a legal requirement for all bird keepers in Great Britain to follow strict biosecurity measures to help protect their flocks from the threat of avian flu.

    Implementing the highest levels of biosecurity measures on farm is the most effective way in reducing the risk of disease spreading and is the best way to protect flocks. The introduction of the AIPZ comes after the United Kingdom has faced its largest ever outbreak of avian flu with 190 cases confirmed across the United Kingdom since late October 2021, with over 30 of these confirmed since the beginning of the month. The East of England has been particularly badly hit with outbreaks in poultry and captive birds. There have also been outbreaks in the south west and in wild birds at multiple sites across Great Britain.

    Avian influenza circulates naturally in wild birds and when they migrate to the United Kingdom from mainland Europe over the winter they can spread the disease to poultry and other captive birds. Maintaining strict biosecurity is the most effective method of protecting birds from the virus.

    Keepers with more than 500 birds will need to restrict access for non-essential people on their sites, workers will need to change clothing and footwear before entering bird enclosures and site vehicles will need to be cleaned and disinfected regularly to limit the risk of the disease spreading. Backyard owners with smaller numbers of poultry including chickens, ducks and geese must also take steps to limit the risk of the disease spreading to their animals.

    The UK Health Security Agency (UKHSA) advises that the risk to public health from the virus is very low and the Food Standards Agency advises that avian influenzas pose a very low food safety risk for consumers. Properly cooked poultry and poultry products, including eggs, are safe to eat.

    In a joint statement the Chief Veterinary Officers for England, Scotland and Wales said:

    Bird keepers have faced the largest ever outbreak of avian flu this year and with winter brings an even more increased risk to flocks as migratory birds return to the United Kingdom.

    Scrupulous biosecurity and hygiene measures is the best form of defence, which is why we have declared an Avian Influenza Prevention Zone (AIPZ) across Great Britain, meaning that all bird keepers must take action to help prevent the disease spreading to more poultry and other domestic birds.

    The introduction of an AIPZ means regardless of whether you keep a few birds or thousands, you are legally required to meet enhanced biosecurity requirements to protect your birds from this highly infectious disease.

    The introduction of an AIPZ follows a decision to raise the risk level for avian influenza incursion in wild Birds in Great Britain from ‘medium’ to ‘high’. For poultry and captive birds the risk level has been raised from ‘medium’ to ‘high’ at premises where biosecurity is below the required standards, and from ‘low’ to ‘medium’ where stringent biosecurity measures are applied.

    The nationwide AIPZ builds on the additional biosecurity measures that were brought in last week as part of the regional housing order which covers Norfolk, Suffolk and parts of Essex. The AIPZ, now in force across Great Britain, does not include a nationwide requirement to house birds. However, this is being kept under constant review.

    There has been a prolonged season of avian influenza this year and with the now increased risk during the winter, the need to include a mandatory housing requirement in the AIPZ may arise. Further disease control measures will be based on the latest scientific evidence and veterinary advice.

    The AIPZ means bird keepers across Great Britain must:

    • Keep free ranging birds within fenced areas, and that ponds, watercourses and permanent standing water must be fenced off (except in specific circumstances e.g. zoo birds).
    • Clean and disinfect footwear and keep areas where birds live clean and tidy;
    • Minimise movement in and out of bird enclosures;
    • Reduce any existing contamination by cleansing and disinfecting concrete areas, and fencing off wet or boggy areas
    • Keep domestic ducks and geese separate from other poultry.
    • Ensure the areas where birds are kept are unattractive to wild birds, for example by netting ponds, and by removing wild bird food sources;
    • Feed and water your birds in enclosed areas to discourage wild birds;

    Keepers should familiarise themselves with our avian flu advice and report suspicion of disease to APHA on 03000 200 301.

    The avian influenza prevention zone will be in place until further notice and will be kept under regular review as part of the government’s work to monitor and manage the risks of bird flu.

    Dead wild birds may be infected so don’t touch them unless wearing suitable protective clothing.  When found on publicly owned land and a decision is taken to remove them, it is the local authorities’ responsibility to safely dispose of the carcases as animal by-products.

    Poultry keepers and members of the public should consult our latest guidance to check the latest threshold for reporting dead wild birds to the Defra helpline on 03459 33 55 77 and not touch or pick them up. Where not required for testing they should be disposed of safely.

  • PRESS RELEASE : Energy Markets Financing Scheme opens today [October 2022]

    PRESS RELEASE : Energy Markets Financing Scheme opens today [October 2022]

    The press release issued by the Treasury on 17 October 2022.

    • The ‘Energy Markets Financing Scheme’ opens today to help support viable energy firms with major operations in the UK from the unprecedented volatility triggered by Russia’s illegal invasion of Ukraine.
    • These firms will be able to apply for government-backed guarantees to secure commercial financing and meet large margin calls from energy price volatility.
    • Following a rigorous approval process, a 100% guarantee will be issued to commercial banks on additional lending for approved firms. The Government will only be liable if a firm defaults on their repayment.

    Russia’s brutal and illegal invasion of Ukraine has led to unprecedented volatility in wholesale energy markets. Over the past month, natural gas futures prices have been changing by more than 15% a day.

    This backstop scheme will help firms facing temporary short-term financing problems.  The EMFS will allow commercial banks to provide larger credit lines to approved energy firms that are unable to meet extraordinary margin calls due to large moves in energy prices.

    This vital intervention will help support wider confidence in the energy market and could help reduce the eventual cost of energy for businesses and consumers.

    The scheme will be open to firms of good credit quality playing a significant role in UK energy markets, as generators, shippers or suppliers. They must currently operate in the UK energy market and must be, or have an entity which is, Ofgem-licensed. Firms will need to demonstrate they are facing large liquidity needs from margin calls when hedging their energy price risk. The EMFS is broadly similar to schemes launched in Germany, Finland and Sweden.

    Chancellor of the Exchequer, Jeremy Hunt, said:

    “A resilient energy market is vital as we all grapple with the consequences of Putin’s horrifying invasion of Ukraine and his decision to weaponise Russia’s energy reserves.

    “Today we are continuing to act to ensure the market itself is secure, significantly reducing any risk of market failure.”

    Governor of the Bank of England, Andrew Bailey, said:

    “The volatility in energy markets we have seen in recent months, caused by Russia’s invasion of Ukraine, has resulted in a number of energy firms facing extraordinary liquidity requirements.

    “This scheme will provide short-term financial support for these firms so they can weather this period, while also supporting the wider resilience of energy markets in the UK.”

    From today, the Bank will screen initial applications for eligibility. HM Treasury will then robustly assess the credit risks and limits before giving final approval. The Bank will then issue a 100% guarantee to the energy firms’ existing commercial bank or banks they use for additional lending. Whilst using the scheme, energy firms will be required to comply with a set of policy conditions, such as restrictions on the use of funds, executive pay, and capital distributions.

    Firms have three months to apply and once approved will be able to benefit from a guarantee for a further 12 months.

    State owned firms and energy firms owned by financial institutions and commodity trading houses will not be eligible for the scheme.

    The ‘Energy Markets Financing Scheme’ was announced on 8 September 2022 alongside the Energy Price Guarantee, with further details confirmed as part of the Government’s Growth Plan on 23 September 2022.

  • PRESS RELEASE : Launch of the Energy Markets Finance Scheme [October 2022]

    PRESS RELEASE : Launch of the Energy Markets Finance Scheme [October 2022]

    The press release issued by the Treasury on 17 October 2022.

    The EMFS was announced by the Prime Minister on 8 September, and in The Growth Plan the then Chancellor confirmed that it will provide a 100% guarantee to commercial banks to provide additional lending to energy firms.

    Delivered with the Bank of England, this scheme addresses the extraordinary liquidity requirements faced by energy firms operating in UK wholesale gas and electricity markets as a result of margin calls.

    Energy prices have been high and volatile in recent months. As a result, large amounts of collateral are required to enter into contracts firms use to effectively insure themselves from price fluctuations, or otherwise firms must accept large credit exposures to their counterparties.

    The details of the scheme are being announced today, and firms can start to apply via the Bank of England. Applications will be accepted for a period of three months.

    The scheme is aimed at providing a backstop to support energy firms facing large and unexpected margin calls. Pricing and conditions will reflect this objective. The scheme will provide resilience to energy markets and therefore help to reduce the eventual cost for businesses and consumers.

    Further details on the structure of the scheme can be found on the Bank of England’s website and the market notice published today. To apply to the scheme please contact EMFS-Applications@bankofengland.co.uk

    Scheme Eligibility
    As part of the application process, firms will need to demonstrate that they meet the eligibility criteria.

    The EMFS is intended to support energy firms who are facing short term liquidity challenges but would be otherwise in sound financial health. Eligibility will be considered based on the following criteria:

    Firms must demonstrate they are in sound financial health (firms must be otherwise solvent and solvency will be assessed through robust due diligence processes)
    Firms must be Ofgem-licensed (or have an Ofgem-licensed entity), and have a pre-existing relationship with an approved commercial bank or banks;
    In addition, firms must also demonstrate they are making a material contribution to UK energy markets through meeting one or more of the requirements outlined below:

    They make material contribution to the UK electricity or gas markets and can demonstrate that they are likely exposed to large margin calls;

    They are heavily inter-connected and the loss of activity would have a significant impact on markets or other energy firms.

    Eligibility will be assessed by the Bank of England and an Advisory Committee convened by HMT, who will make a recommendation for the Chancellor to make a decision to approve or reject each application.

    Eligible firms who wish to apply for a guarantee will be required to comply with a set of policy conditions, such as restrictions on executive pay and capital distributions. For the full list of conditions, please refer to the market notice.

    Financial institutions, state owned enterprises or commodity trading houses are not eligible for this scheme. State owned enterprises should seek to access alternative support from their relevant governments before approaching the Government.

    Application process
    Firms can apply to the scheme for the next three months. Each loan facility agreement will last up to 12 months and will begin from when the guarantee is issued by the commercial lender.

    Applications will be assessed initially by the Bank of England, and then by Advisory Committee, who will make a recommendation for the Chancellor to decide whether to approve or reject an application.

  • PRESS RELEASE : £6.4 million boost for employers to support disabled people [October 2022]

    PRESS RELEASE : £6.4 million boost for employers to support disabled people [October 2022]

    The press release issued by the Department for Work and Pensions on 17 October 2022.

    • Drive to create more inclusive work environments and equip employers with advice on how people from all backgrounds can thrive at work and grow the economy
    • Businesses and disability groups invited to test and shape new service which supports employers to employ more diverse and inclusive workforces

    Thousands of businesses across the UK will benefit from a new £6.4 million online service to help employers better support disabled people and those with health conditions in the workplace.

    The early test version of the Support with Employee Health and Disability service provides essential information about supporting and managing employees with disabilities or health conditions at work.

    Any employer can access the service, which provides free advice on how to manage staff who may be in or out of work with a disability or long-term health condition in a user-friendly online Q&A format.

    The service is aimed at smaller businesses, many of which do not have in-house HR support or access to an occupational health service and will help them to build more diverse and inclusive workforces.

    The new service also covers potential changes an employer could make to help them return to and stay in work, supporting a government drive to boost numbers of people in employment and ensuring everyone has the opportunity to benefit from being in work.

    Minister for Disabled People, Health and Work, Claire Coutinho said:

    Since 2017 we have seen one million more disabled people in work, beating our target by five years. Now we want to go even further by giving more employers the tools and information they need to ensure disabled people and those with health conditions can succeed in the workplace.

    As the new Minister for Disabled People, Health and Work, there is no end to my ambition to build on the success of the Department by making sure disabled people have the same opportunities as everyone else to start, stay and succeed in work.

    The site is currently in test mode, with businesses and disability groups invited to have their say through a short online survey, to help shape the future of the service.

    The site will be constantly updated and improved over the next three years, informed by feedback given from the survey

    The service has been designed to give employers easy access to the advice they need to create the best environments for their staff with disabilities or long-term health issues, so that anyone from any background can start, stay and succeed in work.

    Once fully developed, the service will also help employers understand their legal obligations, including how to make adjustments for disabled people and those with health conditions.

    Over the next three years, the government will invest £1.3 billion in employment support for disabled people and people with health conditions. This money will go towards building up existing provision, including expanding employment support, to grow the economy and help people with the cost of living.

  • PRESS RELEASE : Chancellor statement on the Medium-Term Fiscal Plan [October 2022]

    PRESS RELEASE : Chancellor statement on the Medium-Term Fiscal Plan [October 2022]

    The press release issued by the Treasury on 17 October 2022.

    The Chancellor will make a statement later today, bringing forward measures from the Medium-Term Fiscal Plan that will support fiscal sustainability.

    He will also make a statement in the House of Commons this afternoon.

    This follows the Prime Minister’s statement on Friday, and further conversations between the Prime Minister and the Chancellor over the weekend, to ensure sustainable public finances underpin economic growth.

    The Chancellor will then deliver the full Medium-Term Fiscal Plan to be published alongside a forecast from the independent Office for Budget Responsibility on 31 October.

    The Chancellor met with the Governor of the Bank of England and the Head of the Debt Management Office last night to brief them on these plans.

  • PRESS RELEASE : Chancellor brings forward further Medium-Term Fiscal Plan measures [October 2022]

    PRESS RELEASE : Chancellor brings forward further Medium-Term Fiscal Plan measures [October 2022]

    The press release issued by the Treasury on 17 October 2022.

    The Chancellor of The Exchequer Jeremy Hunt has today, Monday 17 October, brought forward a number of measures from 31 October’s Medium-Term Fiscal Plan.

    • Changes designed to ensure the UK’s economic stability and provide confidence in the government’s commitment to fiscal discipline
    • Basic rate of income tax to remain at 20% until economic conditions allow for it to be cut, IR35 and dividend tax rate reforms no longer going ahead
    • Treasury-led review of energy support after April 2023 launched

    Following conversations with the Prime Minister, the Chancellor has taken these decisions to ensure the UK’s economic stability and to provide confidence in the government’s commitment to fiscal discipline. The Chancellor made clear in his statement that the UK’s public finances must be on a sustainable path into the medium term.

    Today’s announcement represents another down payment following the reversal of the corporation tax cut announced on Friday 14 October by the Prime Minister. The Chancellor will publish the government’s fiscal rules alongside an OBR forecast, and further measures, on 31 October.

    In his statement the Chancellor announced a reversal of almost all of the tax measures set out in the Growth Plan that have not been legislated for in parliament. The following tax policies will no longer be taken forward:

    • Cutting the basic rate of income tax to 19% from April 2023. While the government aims to proceed with the cut in due course, this will only take place when economic conditions allow for it and a change is affordable. The basic rate of income tax will therefore remain at 20% indefinitely. This is worth around £6 billion a year.
    • Cutting dividends tax by 1.25 percentage points from April 2023. The 1.25 percentage points increase, which took effect in April 2022, will now remain in place. This is valued at around £1 billion a year.
    • Repealing the 2017 and 2021 reforms to the off-payroll working rules (also known as IR35) from April 2023. The reforms will now remain in place. This will cut the cost of the government’s Growth Plan by around £2 billion a year.
    • Introducing a new VAT-free shopping scheme for non-UK visitors to Great Britain. Not proceeding with this scheme is worth around £2 billion a year.
    • Freezing alcohol duty rates from 1 February 2023 for a year. Not proceeding with the freeze is worth approximately £600 million a year. The next steps of the Alcohol Duty Review announced in Growth Plan 2022 will continue as planned. The alcohol duty uprating decision and interactions with the wider reforms to alcohol duties under the Alcohol Duty Review will be considered in due course.

    This follows on from the previously announced decisions not to proceed with the Growth Plan proposals to remove the additional rate of income tax and to cancel the planned increase in the corporation tax rate.

    Taken together, these changes are estimated to be worth around £32 billion a year.

    The government’s reversal of the National Insurance increase and the Health and Social Care Levy, and the cuts to Stamp Duty Land Tax, will remain benefitting millions of people and businesses. The £1 million Annual Investment Allowance, the Seed Enterprise Investment Scheme and the Company Share Options Plan will also continue to further support business investment.

    Energy bills support review

    The government has announced unprecedented support within its Growth Plan to protect households and businesses from high energy prices. The Energy Price Guarantee and the Energy Bill Relief Scheme are supporting millions of households and businesses with rising energy costs, and the Chancellor made clear they will continue to do so from now until April next year.

    However, looking beyond April, the Prime Minister and the Chancellor have agreed that it would be irresponsible for the government to continue exposing the public finances to unlimited volatility in international gas prices. A Treasury-led review will therefore be launched to consider how to support households and businesses with energy bills after April 2023. The objective of the review is to design a new approach that will cost the taxpayer significantly less than planned whilst ensuring enough support for those in need. The Chancellor also said in his statement that any support for businesses will be targeted to those most affected, and that the new approach will better incentivise energy efficiency.

    The government is prepared to act decisively and at scale to regain the country’s confidence and trust. The Chancellor stated in his speech that there will be more difficult decisions to take on both tax and spending. This means doing what is needed to lower debt in the medium term and to ensure that taxpayers’ money is well spent, putting public finances on a sustainable footing.

    In light of this, government departments will be asked to find efficiencies within their budgets. The Chancellor is expected to announce further changes to fiscal policy on 31 October to put the public finances on a sustainable footing.

  • David Howell – 2022 Speech on the Growth Plan (Baron Howell of Guildford)

    David Howell – 2022 Speech on the Growth Plan (Baron Howell of Guildford)

    The speech made by David Howell, Baron Howell of Guildford, in the House of Lords on 10 October 2022.

    My Lords, I welcome my noble friend Lady Neville-Rolfe back to the Front Bench and I congratulate the noble Baroness, Lady Gohir, on her maiden speech. I am sorry that the right reverend Prelate the Bishop of Birmingham is leaving us.

    I begin by reminding your Lordships of something they probably do not need reminding of, but the media and many critics of the Government certainly do. After the two years of shutdown of the entire economy during Covid, plus now a war in Europe, after a huge swelling of public spending to cope with all that, and now the enormous energy cap finances and subsidies to stop the bleeding, it cannot be any surprise at all that we are in a very tight public finance situation.

    I cite the Office for National Statistics in saying that public sector debt, excluding public sector banks, at the end of last month was running at £2.428 trillion. That is a couple of hundred billion more than this time last year. That puts net public debt at 96.6% of GDP. That is a net level last seen here in the 1960s and just slightly lower than at the end of the Second World War, or some of the levels experienced in the 1930s. This is not the highest in the world by a long chalk. In fact, it is the 11th highest in Europe. I see no harm and some good in judicious tax cuts, especially those that would bring down the CPI, which has an enormous effect downwards on government finances, or those that actually increase revenue, such as lowering fuel tax or going back to the income tax top rates the country enjoyed under Tony Blair, Gordon Brown and Alistair Darling, which were quite happily accepted then but now seem to cause such agitation.

    But when all that is done, it is obvious that very big steps are now needed on the spending side. I beg Ministers to understand that the sane and effective way of bringing public finances into some sort of reputable balance is to identify and remove functions from the public sector, rather than slashing budgets all round by 10%. That is the classic Treasury style. The functions approach, which is questioning systematically the objectives of endless departmental activities and why they need to be in the state sector at all, was what we tried in the 1970s and later in the 1980s when I worked with John Hoskyns, as has been mentioned, which eventually led to taking most major industries out of state ownership, a healthy restoration of the balance between the state and the market, a real reduction in civil service manpower and a major contribution to growth.

    I take my last minute to argue on another point: to make the real case for levelling up. By that, I mean by universal capitalism, rather than trying to do it by universal income redistribution. Assets and savings in the bank are what every family in the land needs for their security and dignity. Measures to bring about a capital-owning democracy and a much fairer and more widespread form of social capitalism than we have now are what Governments of the last 50 years have shied away from again and again. Now is a much better time to approach this. This is the real levelling up—the capitalism working for everyone everywhere that Theresa May used to speak about. It is time for serious action on that front to make a real difference to people’s prosperity, certainty and prospects.

  • John Birt – 2022 Speech on the Growth Plan (Lord Birt)

    John Birt – 2022 Speech on the Growth Plan (Lord Birt)

    The speech made by John Birt, Lord Birt, in the House of Lords on 10 October 2022.

    Announcing unfunded tax cuts in the Government’s mini-Budget was all but universally condemned. There was no advance consultation, no leaning on expertise. The Permanent Secretary to the Treasury was summarily fired, the OBR’s offer of a forecast waved away. This appeared a back-of-the-envelope, “we know best” plan.

    The immediate consequences of course were dramatic. The Bank of England was selling UK debt one moment and buying it back the next. It had to mount a massive and costly rescue of pension funds. We experienced a rapid rise in interest rates, impacting both individuals and business. The estimates of the future level of government debt ballooned and the cost of financing that debt rose to 4% and is still rising.

    The impact of all these factors on redistribution will be chaotic; the full consequences ahead for public services are still unknown. The rationale, of course, was growth, and we all want more growth. The World Bank published a league table of growth rates for the G7 countries from 2008 to 2021. Is Britain in the relegation zone? No. In fact, we are near the top; we are third, behind the United States and Canada, and ahead of Germany, France and the rest—hardly a crisis.

    The US is clearly top of the tree with a 1.9% average annual growth rate versus our 1.1% over that period. So, yes, it would be nice to be up there with the US—but how? Where is the analysis: not another back-of-the-envelope plan but a deep and evidenced diagnosis to help us understand what really stands in the way of higher growth in the UK? The notion that stimulating the economy at a time of full employment and high inflation will do the trick sustainably is widely condemned and wide of the mark.

    One requirement for growth is clearly investment, yet we have now spooked the markets. Investors have a global perspective: they look for opportunity but will shy away if we fail to offer them reliability and stability too. Beyond that, what can government do?

    We know that we have vast labour and skills shortages across the economy: crops unpicked, short-staffed restaurants unable to open on the days they used to, and too few doctors and nurses. I know from my own exposure to the real economy that we are short of many more skills—for example, data scientists, digital marketeers and engineers. The Institution of Engineering and Technology estimates a current shortfall of 200,000 across the economy. We need a massive drive to bring our system of education and skills into line with the UK’s economic needs.

    Moreover—I experienced this very strongly myself—modern workers no longer live just down the road. Executives and specialists often fill jobs hundreds of miles from home, travelling huge distances each week to reach their work, crashing locally mid-week. Other workers commute long distances daily, and all travel to and from work unproductively in our crowded country, on the worst road and rail infrastructure in the developed world.

    Addressing these and other problems will improve the trend line of UK growth, but problems largely ignored for decades will take decades to put right. The notion that we can suddenly accelerate beyond the US to a sustainable annual growth rate of 2.5% is manifestly unachievable. The sooner the Government come back down to earth and face reality, the better for us all.

  • Joan Walmsley – 2022 Speech on the Growth Plan (Baroness Walmsley)

    Joan Walmsley – 2022 Speech on the Growth Plan (Baroness Walmsley)

    The speech made by Joan Walmsley, Baroness Walmsley, in the House of Lords on 10 October 2022.

    My Lords, the Chancellor’s special economic operation was not as tragic as Mr Putin’s appalling special military operation, but it was pretty tragic for the economic prospects of ordinary people. Since the Budget that was not a Budget, I have met a small business that has shelved its expansion plans, a person with two jobs who is now looking for a third, and a mother of four who got extra blankets from the charity shop to avoid putting the heating on.

    Planning to cut taxes for top earners shows whose side the Conservatives are on, and I am glad that they have decided to reverse that idea. In their defence, they say that they will reduce the basic rate of income tax by 1p next April—that is if we all get through the winter. However, 5 million people earn too little to pay tax, and the freeze on the tax threshold means that the average family will be £290 worse off next year anyway, and the tax cut is worth only about one month’s mortgage payment increase for some people.

    Then there are energy bills. The Government have intervened to cut bills but they are still double what they were a year ago. The Prime Minister and the Chancellor, with their bungled Budget that was not a Budget, caused a massive increase in mortgage rates, connected exactly to the timing of the Chancellor’s statement. They spooked the money markets so badly that the Bank of England had to intervene to prevent pension funds going bust. All this adds up to ordinary families struggling, and then the Chairman of the Conservative Party tells them to go out and get a better paid job—shades of “Get on your bike”.

    The Prime Minister has invented a new fantasy enemy: the anti-growth coalition. She even said in her conference speech that green issues are anti-growth—no; it was Brexit that was anti-growth. We on these Benches are not against growth but we are in favour of growth that works; growth from the bottom up rather than from the top down. We are in favour of the growth of well-paid jobs in science and technology industries, particularly green technologies to reduce emissions. That is not anti-growth; that is a vision for saving the planet.

    Telling companies that they can keep more of their profits rather than increasing corporation tax is telling them that they can spend it on whatever they like—perhaps increasing CEO salaries. They should instead be saying that companies can keep more of their profits but must spend it on innovation and research and development to increase productivity and increase the skills of their workers. This can be done by various measures, including more tax credits.

    The Lords Science and Technology Committee, in its latest report, heard evidence that growth comes from investing in science and technology. We welcomed the new national Council for Science and Technology, chaired by the previous Prime Minister, and recommended that it should meet more often—but the first thing the current Prime Minister did was to abolish it. Now all government departments are being asked to make cuts. What cuts will be made to the Chancellor’s former department, BEIS, reducing its ability to fund innovation and R&D?

    I recognise that the Government have provided a significant amount of money to subsidise energy bills, but I have heard nothing about how they plan to reduce energy demand, thus improving energy security and cutting the amount needed for the subsidy and the cost of borrowing money for the subsidy, as well as ordinary people’s bills. Where, in the noble Baroness’s opening speech, was an emergency programme to insulate houses? Where are the improvements to building regulations and, importantly, enforcement to ensure that all new buildings are energy efficient? It saves families money, saves the Government money and creates jobs. What is not to like?