The government announced £63 bn of investment following a one day event at the Guildhall. Much of it was familiar projects that companies have been working on for some time. Almost 40% of it was Scottish Power plans for more grid and a power cable link from Scotland to Yorkshire. Almost two thirds of it was investment in renewables and grid in pursuit of net zero.
Scottish Power is down for £24 bn over four years. Last year it invested £1.8 bn, well up on the previous year. To do so and to pay a £1.25 bn dividend to its Spanish owner it added to its net borrowings. We are invited to believe it can treble its investment rate over the following year and sustain that for four years. How does it pay for that?
The problem with this heavy investment in green transition including £8 bn in carbon capture and storage is it will not add much to GDP after the build activity, as the extra power is needed to replace closing nuclear and gas stations. Renewables need extra grid and storage but as the government tells us they will be cheaper than gas or nuclear that would reduce GDP.
The government looked very unprepared for this Investment Summit though it was an idea the previous government started and the new government has been talking about it for months.If you want a growth strategy you should as a government have drawn up a bigger list of key infrastructure items we need where government plays a big role. Where were the road schemes, the new reservoirs, the new and larger water and sewer pipes, the broadband capacity, the new rail capacity, the flood schemes , the advanced all weather fruit and vegetable schemes and the rebuilt U.K. fishing fleets? Where is all the extra housing and infrastructure needed to provide for hundreds of thousands of new arrivals every year?
There are so many more opportunities to grow where government is needed to offer planning permissions, licences and in some cases part of the investment finance. The £64 bn is a very limited list, with a few good private,y financed data centres as a welcome addition.
October 16, 2024
Good morning.
Spanish jobs for Spanish workers.
Tow tier crime and punishment. Sleeze scandals. Removal of OAP Winter Fuel Allowance. Giving away British Sovereign Territory, and then making an agreement to lease them and pay a foreign country that has never owned them. And now the above.
As someone said to me yesterday about a client company – “They are a real s***show !”
October 16, 2024
“If you want a growth strategy you should as a government have drawn up a bigger list…”
They don’t want growth, other than in the size and power of government and the public sector/NGOcracy. It’s difficult to see this as very different from our governments in the last few decades or so. They’ve been burning through taxpayers’ money and interfering in people’s lives at an increasing rate and have lost sight of light touch, “don’t mend it if it ain’t broke” rule.
The summit was there to get some headlines and sound bites. Meanwhile what’s left of Britain looks and feels ever more like a third world country. Such is the legacy of PPE, and the long march through the institutions.
October 16, 2024
Indeed, if they want a growth strategy they should ditch net zero, frack, drill and mine, cut taxes, ditch VAT on school fees, not abolish Non Dom status, cut the size of Government by 50%, ditch the war on landlords, motorists, businesses, hard working people, the wealth, the self employed… ditch soft loans for useless degrees 75% of them, stop low skilled immigration… not a single one of their policies – other than relaxing planning makes any sense whatsoever. Rather like the Tories for the last 14 years but even worse.
October 16, 2024
+1
October 16, 2024
Surely you’re aware John that Net Zero is the only game in town. This is designed ti bankrupt us and the money pledged will ultimately do just that. Carbon Capture and storage will add about 2o% onto our electricity bills. The standing charge will be increased to pay for the unsightly pylons.
We have lunatics incharge and we are about to see the biggest transformation in history when the government of regions is implemented. Very similar to the EUs idea of carving up the country to lose our identity.
It’s sheer vandalism perpetrated by a minority government enabled by the stupid tory government of the past 14 years.
October 16, 2024
+1
October 16, 2024
+1
England is to be broken up into regions which are very similar to the kingdoms of Alfred the Great’s time: the latest “application” for devolution is to be called The Heart of Wessex and will cover Dorset, Somerset and Wiltshire.
Of course the citizens of those counties haven’t been consulted or given their agreement …. in case they say no, like Northumberland did under the Blair/Brown regime.
Labour wants to federalise the UK and England is “too big” ….. so it must be broken up.
October 16, 2024
@ I Wraggg
Sadly, you are right! The council of Nations and Regions have already had their first meeting, last Friday!
October 16, 2024
On The Conservative Woman yesterday, Mat Brown (writer and former investment banker) wrote about a document quietly produced. It describes the Nations and Regions set up; the Citizens assemblies that can bypass Whitehall. He says it’s unclear who would be in charge of the country. There’s too much to easily précis here, so I have copied the link.
https://www.conservativewoman.co.uk/the-future-is-gray-brown-and-anti-democracy/
October 16, 2024
You have your doubts about its effect on GDP, I question what it will do for personal GDP.
Where is the investment in SMRs from UK sources. Reliable power that puts money in the pockets of UK workers, wheras windmillls serve the chinese economy.
I think we all suspect that our future should be with lower taxes and much less government spending, but I await the budget wirh little expectation.
October 16, 2024
Nuclear is not very good for renewable back up you need a power source that can be ramped up and down which means gas, coal, oil, wood at drax (though wood (young coal) at Drax is far worse in CO2, for the environment and in cost to burning old coal. For renewable you need gas or coal backup. Batteries are far too expensive.
October 16, 2024
Expensive and hugely energy wasteful too.
From Matt Ridley in the spectator:- Electricity prices have doubled in Britain since 2019. They are 46 per cent above the International Energy Agency’s median for industrial and 80 per cent above the median for domestic electricity. As the independent energy analyst David Turver points out, British business pays almost four times as much as American business for each unit of power and British consumers pay almost three times as much as Americans.
Almost the most expensive energy in the world and yet they expect growth!
October 16, 2024
https://www.spectator.co.uk/article/how-ed-miliband-plans-to-conjure-electricity-out-of-nothing/
October 16, 2024
I’m sure I read somewhere that rolls Royce had sold its buildings that they were going to use for developing SMR’s because they were fed up of government dithering on the subject.
October 16, 2024
There was much talk of “growth”. The only “growth” on offer appears to be more national debt and more taxation “invested” in net zero returns and worse.
October 16, 2024
Define investment. Define hate. Define racism. Words are now weapons of ideological power and have lost all meaning.
October 16, 2024
You ask ‘Where is all the extra housing and infrastructure?’, Sir John. A lot of the housing will be in your former constituency. As for the infrastructure, that will lag a long way behind as usual, because the developers will be allowed by local authorities to do as they please, also as usual.
October 16, 2024
The simple solution is to cut personal and business taxation, then the investment and personal effort to increase productivity will follow.
People and companies work for themselves, their shareholders, and their own families NOT the Government.
Two Big decisions are needed by the Government, scrap net Zero, and stop immigration, no need to hold a conference and try to bribe businesses with promises which can then be undone.
October 16, 2024
“Renewables need extra grid and storage but as the government tells us they will be cheaper than gas or nuclear that would reduce GDP” – which points to what a doubtful measure is GDP but energy expense overall may easily increase to then boost GDP and give the government an illusory triumph.
October 16, 2024
The Eco Zealots are firmly in charge and Intermittent Energy is the only “investment” the Government is interested in.
The WEF’s Great Reset is about rationing, restrictions and reducing demand. Why would they invest in infrastructure which might damage the WEF’s objectives?
October 16, 2024
And at a practical level on flood preventon, where is the river dredging? It is not difficult, and essential. It was done years ago until ‘environmental’ extremists in management stopped it. A lot is now needed, urgently. The water can no longer get away but climate politicians are blaming extreme climate change. It suits their cases.
I live in a small village. We are at the foot of a hill and the start of a big river. Silt in the small water route through was causing flooding on a road and close to some houses. It was on private land further on but was cleared and the problem was solved.
Just get on with it in the rivers, dammit.
When are common sense people going to take over again?
October 16, 2024
Each item you list Sir John is needed as a consequence of grown or growing population.
Perhaps Ms Reeves idea to raise Employers’ NI is a way to make business pay for their addiction to cheap imported labour. Shame that as with everything government touches the little people ultimately pay.
October 16, 2024
Hmmm. So we are allowed nothing cheaper because it will reduce the holy grail of GDP. No wonder everything in this country is so expensive. As well as making nothing, we all charge each other high prices so we have high GDP. Sounds like lunacy to me. Where is the fabled ‘GDP per head’ in this madness?
Reply I was using irony. The power will not be cheaper but to grow you need to do more than replace