First published in Infrastructure Intelligence, Copper’s John Twitchen, Martin McCrink and Sam Cranston take a look at what the election of the new Labour Party leader will mean for UK Infrastructure.
On Saturday Jeremy Corbyn was given a mandate from Labour voters and the appointment of John McDonnell as Shadow Chancellor was a stamp of authority on the party. But what does it all mean for infrastructure?
Well, what do we know? Jeremy Corbyn has made three clear statements on infrastructure. Firstly, a National Investment Bank for infrastructure which the public sector could use for financial support.
Corbyn said in his manifesto (The Economy in 2020) he would “establish a ‘National Investment Bank’ to invest in the new infrastructure we need and in the hi-tech and innovative industries of the future. To invest in infrastructure also requires a clear strategy in the construction, manufacturing, and engineering skills to build and maintain that new infrastructure so vital to sustainable economic growth.”
Secondly, people’s Quantitative Easing will be used for building homes and infrastructure. This means the state should play a greater role in financing and running infrastructure projects.
Thirdly, he has stated he wishes to renationalise certain infrastructure, including railways and the National Grid.
Investment in infrastructure is, therefore, a priority for Corbyn’s Labour Party.
He represents a departure from the Labour Party’s position, especially since 1995 and the updating of Clause IV – Labour’s decision to promote socialism through a set of values, rather than state ownership of industry and services. Many see this as the definition of New Labour.
Broadly speaking, there has been consensus and consistency across the main political parties about the general direction for infrastructure, both financing and planning, over the last 20 to 30 years. On Saturday lunchtime, that consistency was interrupted in dramatic fashion.
What does industry do now?
Whether Labour party members chose Corbyn because of his policies, his style or his messages about the Government, one common theme that shines through is his challenge to the status quo and the questions he has asked about current policies and how our society is financed and operated.
The infrastructure industry needs to answer those questions. Dismissing the questions that Corbyn’s victory asks would be a mistake. Staring down and mumbling at our shoes is not an option.
There are now two clear choices for how Britain’s infrastructure works: stick to the plan or do something different. Corbyn’s victory shows that the ‘do something different’ option appeals to some.
It is industry’s job to explain the benefits of maintaining the current path. Never has the need to demonstrate the social, economic and environmental benefits of infrastructure been under more of a spotlight.
We are in for one of the most interesting political periods in recent times. So is the infrastructure sector.