On the face of it, the Chancellor’s big growth speech tomorrow could be one of this government’s most significant interventions yet. If Rachel Reeves is serious about starting the building process for a third runway at Heathrow – she is expected to endorse the idea formally tomorrow – she will be single-handedly overturning more than a decade of Nimby consensus under the Tories that such projects simply were politically impossible to carry out.
The same goes for her pledge to finally get some homes built, and to ‘take on regulators, planning processes and opposition’ to the growth consensus. These also seemed like an impossible task for the governments that came before her.
But here’s the catch: this is not the government’s first speech about growing the economy (see last October). It’s not the first promise for change (see the ‘Plan for Change’ speech last December). Nor is it anywhere near the first attempt to pivot towards a more positive narrative (you can go back to August last year, and the Prime Minister’s ‘fixing the foundations’ speech for that one).
Indeed, talk of a ‘brighter future ahead’ has been in some iteration of every ministerial intervention since the run-up to the Budget, when the government realised that repeatedly talking down the economy had the unfortunate effect of terrifying businesses, investors and consumers. They’ve painted a rosier picture since, but one that has been outweighed by some rather heavy-handed policy-making: particularly the hike to the tax on jobs, which just this week has rustled up warnings about employers getting ready to make job cuts to avoid a higher National Insurance bill.
This is the tricky bit: connecting the rhetoric with the action. The Chancellor’s tour to meet and speak with the country’s top CEOs this morning is no doubt an important exercise – if they think these major growth reforms are really about to be implemented. Otherwise it’s not significantly different from last year’s Investment Summit – or the countless conversations had between the now-government and business leaders in the run-up to the election – when a growth-friendly vision was voiced but, still, not acted upon.
Give the new government time, will no doubt be the retort. Yes, sure, let politicians warm up, but the definition of ‘new’ is doing a lot of heavy lifting these days. Under the most generous circumstances, Labour is a tenth of the way through its Parliament, and the kinds of reforms and growth it’s talking about are going to take years, if not a decade, to see through. That means making the reforms yesterday, or at the very least, right about now. Yet so much, from housing to healthcare, has remained in the hypothetical stage; pledges regarding vast reform watered down to simply meet existing targets.
‘Over the past six months as Chancellor,’ Reeves is expected to say tomorrow, ‘my experience is that government has become used to saying “no”. That must change. We must start saying “yes”.’ It’s a simple and effective message, but it also suggests that ‘government’ is something else, made up of anyone else, besides the Labour party. These regulations the Chancellor wants overhauled, this pivot towards a pro-growth attitude – the prioritisation of new tunnels over bat homes, to sum it up – these are the decisions for politicians to make and then instruct institutions and agencies to carry out. They’ll be difficult and controversial, which is why the UK has been so restrained in the past. Most critically, they’ll require some action.
