Showing posts with label Business. Show all posts
Showing posts with label Business. Show all posts

Monday, 4 June 2018

The Northern Powerhouse is a smoke-and-mirrors sales pitch to sell the North and it's assets. The North needs something real.

Photograph: Northern Rail train at Manchester Oxford Road by Mikey. (License) (Cropped)
The chaos caused by the mess Northern Rail has made of it's timetables, has led to commentators calling into question how committed the government really is to the vaunted Northern Powerhouse - it's plan to rejuvenate the North.

Perhaps this mess would have been containable for the government, if it wasn't for the fact that the collapse of the rail network in the North comes not in isolation, but on the back of big promises that been ever further downgraded until they have been all but scrapped.

Tory ministers had pledged major upgrades and major new links. But the big pledges were watered down. Last summer, the transport minister announced that Electrification for the North were cancelled, even as he confirmed more investment in London.

And the ambitions of the TransPennine railway upgrades have been severely contracted - originally pitched as work from Liverpool to Newcastle, the latest focus is just on speeding up links between Bradford, Leeds and Manchester.

Even in the face of the current crisis, the Transport Secretary has been reluctant to talk punitively of how the rail services are being run - even as they are effectively curtailed, cut down to something approximate to an emergency schedule.

It isn't hard to see why the Northern Powerhouse now looks to have been all smoke and mirrors.

Part of the problem is that it was. In essence, the government plan for devolution was constructed around a branding exercise - the "Northern Powerhouse", the "Midland's Engine" - the semantics of which give away the broader aim of gearing the regions towards serving the corporate interests of UK PLC.

In practice, devolution reflected Conservative interests. It cut money from local services, only to return it, in part, through the Metro Mayors - executive figures, alienated from local government and accountability - whose role seems mostly intended to spend the funds on easing the way for business.

The focus was on building a framework, an infrastructure, that will encourage inward investment into a transport hub that would have most Northerners at most an hour away from most major Northern cities and their employment opportunities.

But the plan has also effectively cut local people out of the loop - developing plans for them, to impose on them. And the focus is still on the cities, and not post-industrial towns, where people have been left feeling abandoned.

Recently speaking at a Manchester Business School event on the Northern Powerhouse, Vince Cable delved into how the Powerhouse plans that he and George Osborne developed unfolded.

Cable said that the Northern Powerhouse was supposed to achieve two things: balance out the lure of London and address previous failures to get people and jobs in the same place - which he referred to as the "work to the workers, or workers to the work" dilemma. Transport would be key to Powerhouse's "workers to the work" approach.

Cable argued that efforts were however undermined by budget cuts - the Liberal Democrat said that he protested cuts to capital spending, and that the local government minister failed to protect local government budgets.

The result was a collection of cities, still poorly connected, that have become more vibrant and dynamic, but are still surrounded by impoverished suburbs - already stripped of opportunities, now cut off and drowning amid cuts.

In these conditions, of course, any investment for the North is welcome. And needed. But is tailoring the whole region purely for business the right way to go about it?

The Conservatives have sought to rebrand the North and prepare it's assets - including Northerners themselves, presented as a pool of workers and customers within easy reach and ready to scramble - for sale. Regional devolution becomes a sales pitch, all show and no substance.

But where are Northerners themselves fitting into this? People in the North are struggling to make ordinary journey's to work, that they really can't afford to lose. With competition for jobs so overwhelming, expensive journeys and cancellations are a direct threat to the ability of the lowest earners to get by.

There's only so much that an influx of business investors and new jobs could fix - even job security would unlikely be improved if the amount of work available better matched the demand for employment, such is the direction working conditions are headed in.

The North need more that is rooted there. Affordable housing. Affordable and reliable public transport. Career opportunities for the least well off, and least skilled, with the longevity and security around which to build a life.

Was any of this ever on the cards with the Northern Powerhouse?

The North needs public investment in public infrastructure and work deeply rooted in it's own communities - the means to make use of it's own resources. Achieving that from the outside, from distant Westminster, would be hard.

But from well organised and funded local government, taking seriously civic engagement, giving people a real voice and involvement? In that there is hope.

Wednesday, 16 March 2016

Budget 2016: Osborne's Sugar Levy will get the headlines, but he's presiding over a weak economy and a fractured society

Osborne's budget will grab headlines, but there is more moving beneath the surface. Photograph: Pound coins from Pixabay (License) (Cropped)
If there is anything you can take away from the UK government's 2016 budget statement, it's that the Chancellor George Osborne knows how to tick boxes. There was support for small businesses, a levy on sugary products and government help for savers (BBC, 2016).

The Chancellor gave these policies, gathered together, a budget for the next generation. Yet as ever, the headlines are only what Tim Farron called the 'political theatre' (ITV, 2016). There is much more to be found in the details - not least a revealing look at the Chancellor's approach to government.

Osborne admitted that economic growth forecasts suggest the economy is growing more weakly, and that the government has missed its own debt and deficit targets (BBC, 2016). Yet room was still found for cuts to corporation, raising the highest tax band and making cuts to capital gains tax.

Jeremy Corbyn's response was hostile. From the off he called the Chancellor's budget a legacy of failure, that was poor on equality (BBC, 2016{2}). The Labour leader argued that the breaks for the wealthy were being paid for by those who could least afford it.

Corbyn said that tax breaks for the wealthy were disgusting when they were accompanied by cuts to disability support. The poor attitude towards equality was epitomised in the continued existence of the tax on 'women's products', as in essentials like tampons and sanitary towels, and the patronising plan of distributing the proceeds to 'women's' charities.

As for the next generation, there was little in the budget to offer a tremendous amount of hope. Under-25s won't benefit from minimum wage rises - or increasingly from any kind of social security at all (BBC, 2013) - and savings help for under-40s won't do much to help deal with rising housing rents, let alone house prices.

There was also little information on how the Chancellor intended to find the funds to cut the deficit. Beyond the previously announced changes on tax credits and ESA, there were no other major spending cuts were outlined, beyond a vague commitment to finding around £4bn in government 'efficiencies' - and apparently raising an, astonishing, £12bn from closing tax loopholes.

From a progressive perspective, one thing that the budget did reveal was Osborne's attitude to government. The Conservatives have felt comfortable pitching themselves as supporters of limited government, the private sector and even pitching themselves as rendering the Liberal Democrats obsolete.

But the Chancellor's decisions reveal something different, highlighted in the way that he framed tax cuts for small business. In his statement, Osborne said they were made possible by higher revenue coming in from big business.

But what Osborne could not resist was to also take higher receipts as a signal to cut taxes. What this highlights, and the Chancellor himself alluded to, is the Conservative view of taxation as an incentive or disincentive. A mechanism to be used to manipulate social behaviour toward the governing party's interpretation of the 'national interest'.

What hasn't been asked by those handing out successive tax cuts is whether tax in itself has a role to play as a civic contribution, that goes towards the serving of the public good. Whether there is a contribution that ought to be made, back into the community, for the extraction of wealth in your own interest.

As Osborne cuts back government spending and the public sector he reveals something else. A vision of a small state, one that does little itself but interferes a lot: meddling and social engineering through the tax system, trying to shape society through supply and denial of small but crucial funds to devolved institutions largely bereft of funding.

The sum so far of Osborne's approach is an increasingly divided and unequal society. Taxes have come down but the economy remains weak. Burdens continue to pour onto the more vulnerable. Osborne will get the headlines, but they are only a mask that disguises a weak economy and a fractured society.