I CAN’T quite recall who said it but I love the quote that in leadership “the most important thing is to make the most important thing the most important thing”.
So at the risk of being rude for a Sunday morning, I have to ask you to stop what you are doing and repeat after me: “The national debt and the deficit that’s feeding it is not the most important thing, growth and jobs are the most important thing”.
Well done, now tweet, repeat and tell all of your friends.
Don’t get me wrong, the public finances are in a grave state and have got materially worse in the last nine months. Resolving that is mission critical if we are to be able to look the next generation in the eye as we hand on the baton.
But we have three ways to fix the gap between what we spend and what we earn so that we can reduce our debt. One is to cut spending, the second is to raise tax. Both of these matter but it’s the third that matters most. If we grow the economy and the tax base (the people who pay tax) then that is the most sustainable way to fix our future. Growth means more wealth creation which in turn means more revenues and less need for welfare.
Focusing on fiscal restraint as the only strategy is like a football team fielding 11 strikers because all that matters is scoring the most goals or 11 defenders because we mustn’t concede. Growth must be our focus, fix that and the goals will come. Fail to focus on it and we risk squeezing ourselves to death.
In his autumn statement last week, the Chancellor signalled he is holding his nerve and sticking to his current strategy. Brave and bold he is, no doubt. Snag is, for us all the strategy isn’t working.
For me, blame and point scoring is irrelevant right now when what matters is reconciling all to the task in hand. And it is the sort of colossal challenge the people of these islands have proven well up to facing down in the past.
No Stone Unturned in Pursuit of Growth, the report launched in October by Michael Heseltine, was to my mind a superb start and deserves much more attention than the screeds we read on the public finances right now. Much of the political noise is but “the crackle of thorns beneath an empty pot”. Lord Heseltine is right on many things and on the first that growth should be our focus.
The other major insight of his work is that is that Britain is hugely ill-divided as an economy to our great cost. The gap between the richest area of the UK and the poorest is – by a country mile – the largest of any country in Europe. Five times larger in fact than countries like Sweden and Finland and much larger than other large economies like Germany or France.
London and the South-East have not had the double (soon to be triple) dip recession of the UK which, it is argued, goes some way to explain why the metropolitan chatter often comments that it “doesn’t feel like a recession”. Tell that to the population of Teeside, Northern Ireland, the West Midlands or too many parts of Scotland.
Heseltine’s report makes the same observation. Interestingly for Scotland it makes clear that after London and the South-East, Scotland is clearly the “best of the rest” proportionately in terms of economic contribution (excluding North Sea oil). Heseltine also observes that Britain is hugely centralised in terms of policy and power. Even small (but successful) countries like Denmark, Sweden and Switzerland have more power much closer to the people.
So you don’t have to come all the way with me to my conclusion on Scotland to recognise two things; firstly that the UK needs to get the regions and nations growing faster if it is to grow faster overall, and secondly, that the current centralised model is part of the problem.
I am for leaving “no stone unturned” to kickstart growth but it seems almost self-evident that getting more power to more people across the UK is an over-arching imperative. It is irresponsible for us to just accept the idea that London does the growth and the rest of us live off the trickle down. It’s not fair on London and it’s certainly not fair on us. The symptoms of the failure of this model can be viewed in real time in everything from youth unemployment and suicide rates to the ultimate test, life expectancy. The intent of the post-war model may be pure but the human cost of the outcomes is foul, unacceptable and unsustainable. We have the capacity to do much better for ourselves if only we took the responsibility for our own growth.
Self-reliance, self-respect and the means to self-improvement are what we need in every community in the land. The sound and fury of Westminster budget debates should be background noise against the din of the industry of the rest of us getting on with creating the wealth we need to improve lives and life chances.
We shouldn’t have to hang on every word from Westminster politicians waiting for the hope that should be in our own hands. That really is the “most important thing”. So it’s time we all did something about it.