Boris Johnson's new deal sounds depressingly like the old deal

Ben Chu
·4-min read
POOL/AFP via Getty Images
POOL/AFP via Getty Images

On Saturday, Michael Gove deplored the tendency of politicians to “go for the sugar rush that comes from announcing radical initiatives, unveiling dramatic overhauls, launching new spending programmes, ramping up this and rolling out that.”

Today Boris Johnson responded to that sage observation by the Chancellor of the Duchy of Lancaster by declaring himself a new Franklin Roosevelt for re-announcing £5bn of infrastructure spending.

This “new deal” from the prime minister feels uncannily like the old deal, both when it comes to the substance and the cynically overblown political presentation.

Five billion pounds might sound like a significant amount of money but the reality is that it represents less than a twentieth of what the government was already due to spend on infrastructure in the current financial year.

If this is how the government intends to fund its “infrastructure revolution” then the gates of the Bastille of chronic UK under-investment are unlikely to be troubled.

Yet what’s odd about the prime minister’s speech in Dudley is that he failed to point out that his Government did implement a genuinely significant increase in planned state infrastructure spending earlier this year.

The March budget pencilled in public sector net investment by 2023 of 3 per cent of GDP, up from 2 per cent previously. That will take public infrastructure spending to the highest sustained share of the economy since the late 1970s.

One might reasonably argue that it should have been higher still but it did represent a pretty historic change of direction.

Perhaps the prime minister thought it would look complacent to cite a decision taken before the Covid-19 pandemic struck. More likely he simply wanted a fresh-sounding spending announcement to grab some favourable headlines.

Aside from the money, the speech itself was mainly slogans – “build back better”, “double down on levelling up”, “infrastructure revolution” etc.

While Johnson may want to spend more money on road, rail and transport infrastructure we still don’t know which projects around the country will actually be funded.

We’re informed that a new National Infrastructure Strategy in the Autumn will fill the gaps. But the Government has been publishing these documents for many years now.

George Osborne’s National Infrastructure Plan way back in 2014 outlined £460bn of projects that merited investment from a garden city in Ebbsfleet to a Swansea Tidal Lagoon.

The odds on the Autumn document outlining many of the very same projects – from road widening schemes, to flood defence repairs – as worthy of funding must be as short as the prime minister’s estimate of the public’s attention span. There comes a time when a government needs to move on from building up piles of infrastructure documents to actually building infrastructure.

Johnson’s pledge that there will be no return to austerity in the wake of this crisis sounded pretty categoric. This is of course a recognition of reality in the wake of a decade of severe public service spending cuts. Yet declarations like this are the easy part. How will he fund his talk of higher spending on elderly social care?

Higher taxes are the screamingly obvious solution but the Conservative manifesto in December ruled out any hike in Value Added Tax, income tax and National Insurance. We have yet to hear how this particular circle will be squared.

Perhaps the biggest gap between the government’s rhetoric and its actual plans is the question of giving power away. Gove’s speech at the weekend talked of the benefits to be gained from “relocating government decision-making centres to different parts of our United Kingdom”.

The Conservative manifesto promised an English devolution White Paper this year but we have heard little about it since.

The government’s handling of the pandemic – right up to the new lockdown in Leicester ordered by the Health Secretary – does not suggest an administration that is particularly keen to cede authority to local decision makers, whether elected mayors or local councils.

The opposite in fact. Ministers may speak the language of devolution, but their actions show the same old centralising instinct of the past forty years.

This government – like others before it – will find that unfulfilled promises of new deals get old pretty quickly.

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