About time too – government recognising public money sometimes needed to get private money flowing
Posted on 31 October 2011 | 8:10am
No cliche is being left unturned to emphasise the Prime Minister’s determination to kickstart the sluggish economy. He is straining every sinew. He has found his passion (er … again). He is on an all-out mission. He is tackling red tape. Unblocking the system. He has an ‘obsession’ with ‘shovel-ready’ projects. He is determined to deal with the ‘infrastructure deficit’ which is every bit as serious as the other deficit they keep talking about.
And on and on and on they go, trying to make today’s announcement of a billion pounds worth of infrastructure projects sound like a natural progression of the economic policy they have been pursuing. Which it isn’t.
It is not exactly plan B. But it is an admission of sorts that plan A isn’t working, that their hope that the private sector would fill the gap left by their huge cuts in the public sector (most of which are yet to be felt incidentally) was exactly that – a hope.
Now that the hope has been shown to be largely hopeless, their magic wand having failed to deliver, and more bad figures due this week, they are having to turn back to good old-fashioned public money kickstarting. And about time too.
I will particularly welcome the go-ahead for the £8m Todmorden Curve rail link project, which will link Burnley directly to Manchester, and help drive investment and housing into the Burnley area. This will include huge private sector investment in the £100 million development in the 3.9 hectare Weavers’ Triangle project. It will take public money for the rail link to unlock it though.
and shows once more that a lot is happening there to challenge the caricature.
But above all I welcome the acknowledgement that government has a major role in creating jobs, taxation, and spending power. It is unfortunate that it has taken them so long to realise this, and that their attempts to defy gravity coincided with such a calamitous period in the eurozone. Also the projects in themselves will not be enough to drive away the general gloom which DC is straining every sinew to dispel in his FT article today. But it is a belated start of sorts.