Wednesday, March 19, 2014

Getting HS2 on the Right Track

And so, with the ConDems struggling to fill legislative time, much parliamentary attention is turning to the building of the controversial HS2 rail link, and quite rightly. On the surface, developing a railway network that brings us up, in part, to standards that in the rest of Europe and most developed economies met almost a quarter of a century ago seems like a no-brainer. Indeed, anything that makes the UK smaller, the centralised capital less far away, and invests serious cash into our still struggling economy is certainly a good thing. Much of the debate now centres on the cost, with Labour showing real fiscal credibility on scrutinising promises to keep to the £50bn spending limit (not to mention the fact that our Olympics guru, who delivered 2012 on time and on budget, has been tasked with doing the maths).

Despite this, the polls show only 30% support for a project that seems so appealing, so a charm offensive has begun, with Vince Cable intervening to emphasise the benefits of the project for regional economies in the north and midlands. This is very much a return for form for Vince – the Liberal Democrats long claimed to be the party of localism, although in government they have voted for an agenda that is bankrupting local councils, and presided over the forced centralisation of schools. This is what comes from a party that cares about nothing than electoral success and personal glory – the party of localism when they are running local councils, the party of the centre when they’re in power in Westminster.

There is another layer of painful irony to Cable’s comments, however. The very reason for scepticism outside of London is because there is a fear of the effect of making the capital closer across the regions. Our experience of the electrification of the Birmingham/London train line was to lose Midlands HQs for a number of businesses, most notably Lloyds bank. Making London closer, with an attempt to turn the rest of the UK into a glorified suburb is an unconvincing answer for ordinary people living in market towns and inner cities alike. It’s patronising, with the end result being regional workers moving to London, not wealth and prosperity to the workers, it’s transparently an equation for further growth in jobs and investment in central London.

Of course, as pointed out by the leader of Newcastle City Council, we remain reliant on a largely Victorian railway network; a network that once encouraged prosperity, spread wealth and empowered communities, and it is clear that this network needs modernising. However, it is a category error to say that this network brought that prosperity in the first place, especially to the major urban centres.

Anywhere outside of the M25 suffers from a two-dimensional opinion of its socio-economic heritage – mostly a caricature that these were industrial cities, with economies built on manufacturing alone. This may have become true in the hit-and-miss policies following the 1950s, but the truth of the birth of our great cities is a tale of commercial, social and political innovation, as well as industry. Birmingham’s raw materials came from the Midlands, as did the skills to make guns, jewellery and motorcars – but so did the finance, from regional banks, intertwined with the regional economy. It was the ability of local leaders like Joseph Chamberlain to begin to provide proper education for populace, bring them clean water and eradicate corruption that supported and fed these dynamic powerhouses of not just the UK, but the world. This dynamic environment came from the grassroots, too – local people innovating and investing so much more than money in their own cities and towns. They were not built, and did not survive on, London’s patronage (economic or otherwise).

The alternative to the model which reached its peak in the 19th century has been the centralising of British economic policy, political power and social capital in London since the late 1950s, with any attempt to redistribute economic success from the capital being largely token. This is painfully clear to the communities who continue to be decimated by cuts in central government budgets. Moving jobs from London to the regions and nations did not decentralise them at all – in fact it made these regions even more dependent on subsidy and political grace of the centre. The structure of the civil service remains highly centralised, which means when cuts are made, they are disproportionately made away from London – whether that be in HMRC call centres or professional tax advisors. The perversity of the weighting of employment toward the public sector in so many regions is not that the work is in the public sector, but that this employment is in no way meaningfully ‘regional’. Perhaps the most perverse example is the attempt to ‘de-Londonise’ the BBC, which seems to mean centralising in Manchester, but still dependent on directives from London. At the same time, Pebble Mill is shut, and there are no major centres of BBC production in the East of England at all. Perversely, as with the London-centric nature of the service industry’s headquarters, that means that wealth is created in the regions, and then shipped off back within the M25, feeding a vicious circle of wealth drain.

This all sounds as if this is great for Londoners; manifestly it is not. Property prices soar, population density increases, the opportunity of living community is limited and competition for all levels of employment is disproportionately cruel. As per my earlier ‘blog in January, ordinary Londoners stand to gain as much, if not more, from decentralisation, as do people in the regions.

So am I opposed to HS2? Absolutely not, I’m in favour of a well-costed scheme of public investment that is part of a national strategy to improve our public transport, fast. It’s mad that Manchester and Leeds are as far apart as one end of the London Underground’s Central Line, but seems an age away. But it has to be part of a bigger vision – and I’m not just talking about transport.

What we need is effective devolution of political and economic power, and the state has to lead the way. Putting schools back under the control of local councils would be an excellent start, not to mention removing restrictions on local authorities owning and controlling infrastructure and purchasing land. But this isn’t a real alternative, it’s a modest request for a little less of what we have now, and a little more of what we had before.

Further, we need to look at rebalancing our constitution in favour of regions, counties, cities and parishes. Each division should have the requisite rights, responsibilities and funds to manage set areas of affairs. Why can’t parish councils set their own planning policies? Why shouldn’t regional assembles organise policing, health, fire, and transport priorities for the constituents they are elected to represent? Why should you have more democratic representation if you live in Greater London than in a unitary authority like Birmingham or Doncaster? We need an equal constitutional settlement that allows innovation and co-operation, where the principle of subsidiarity gives the most effective ‘local’ level of government dignity and autonomy over a policy area.

More on the advantages of such localism are to follow on this ‘blog – from the benefits of empowering experienced local activists and creating more competent legislators, to the benefits for health and social policy. However, on the topic of HS2, as great as it would be, it’s not worth any price, as Labour is right to say; and if it does happen, we need to make sure the wealth heads in the right direction up the tracks.