The UK’s fiscal and economic model is broken

Mebyon Kernow’s sister party in Wales, Plaid Cymru, has an impressive economic advisor called Eurfyl ap Gwilym. He famously got the better of Jeremy Paxman during one interview, even challenging him to do better research when preparing questions.

Mr ap Gwilym has produced another article which focuses on how the “UK’s fiscal and economic model” is broken.

What he has to say is as relevant to Cornwall as it is to Wales and, in particular, he has focused on how investment in three areas (research and development, transport and the arts) is still “heavily skewed to the South East” of England.

In terms of research and development, he has shown that “business is by far the biggest source of R&D expenditure and this tends to be concentrated in certain sectors (defence and pharmaceuticals) and geographically.”

Looking at the actual figures: “Of the £6.5bn spent on R&D by the higher education sector 59 per cent, or £274 per person was spent in London and the Home Counties. This compares with £83 per person in the rest of England, £86 in Wales and £196 in Scotland. The differences are even more marked in the case of R&D spending by the UK Government and the research councils: of the £2.2bn spent in 2016: £54 per person was spent in London and the Home Counties; £5 per person in Wales and £30 per person in Scotland.”

It has been the same with transport. Mr ap Gwilym has detailed how London has been the “recipient of a disproportionate share of public investment … over decades.” He has also shown how “cumulative spend per person in real terms since 1999-00 has been £7,500 in London compared with £4,100 in Scotland, a mere £3,000 in Wales and £3,700 across the UK as a whole.”

And in his assessment of arts funding, he notes that “despite the fact that private sponsorship of the arts is overwhelmingly concentrated in London,” it is a reality that “public spending is heavily weighted in favour of London as well.”

Mr ap Gwilym’s main reason for, once again, pointing out the inequities of regional funding, was to raise concerns about the repercussions of Brexit and how this would be “likely to push regional policy even further down the list of priorities of the post-Brexit UK Government.”

He is also right to point out that without a fundamental shift, we will see “little improvement in the relative performance” of regional economies outside London and the South East. And that would be a disaster for Cornwall.

[This is my article in this week's Cornish Guardian].

Conservative austerity needs to end and now!

At the Conservative Party Conference in Birmingham, the Prime Minister announced that the austerity of the last decade is to end and “support for public services will go up.”

I have to admit that I am somewhat sceptical about what has been said, and Theresa May’s announcement has been widely derided as a “soundbite” or positioning for short-term political gain. Indeed, she has couched her pledge as a future action, linked to the outcome of next year’s spending review while also being dependent “on a good Brexit for Britain.”

It was followed within a few days by a cynical appeal by the PM to likely Labour voters, asking them to consider changing their allegiance to the Tories.

Quite rightly, journalists and commentators have been quick to critique the lack of detail behind the rhetoric and how it contradicts what the Conservatives have been saying in recent months, weeks and even days.

And they have not been afraid to point out how it does not reflect the Chancellor of the Exchequer’s financial plan which, while honouring the recent commitment to increase funding for the NHS, would still lead to what one newspaper has described as yet more “eye-watering” cuts in “every other department of state.”

Political opponents have also rubbished the pronouncements from the occupant of No. 10, especially when other leading Conservatives such as the Party Chairman Brandon Lewis have refused to consider rethinking planned reductions in funding to local councils and other public services.

Make no mistake, austerity has done great damage to public services across the United Kingdom, hurting individuals and families and communities in the process.

Senior Conservatives may be making shallow statements about some future cessation of austerity, but local councils such as the unitary authority in Cornwall are still having to grapple with the implications of dealing with savage, unjust and ongoing cuts in central government funding.

And it is to be welcomed that the planned merger of the “Devon and Cornwall” and Dorset police forces looks like it is not going to happen, but such a proposal would not even have been put forward if the promised levels of funding for the police had actually been delivered.

If Theresa May is serious about ending austerity, her Government needs to reverse the cuts to local government, the police and other public services right now; and deliver a whole new approach to government finance through enhanced and fair taxation with the wealthy and big business paying their fair share.

[This was my article in the Cornish Guardian on 10 October].

Housing for local need

The Campaign for the Protection of Rural England has just published a new report about the housing market. It is critical of the extent of planned developments and the amount of countryside that is being lost, and it is also pointing out that the housing needs of local people are still not being met.

The document has been widely welcomed and there was even an editorial in the Western Morning News under the heading “All new homes should be built to meet local need.”

In preparing this week’s article, I looked back at some columns on planning and housing that I have written over the past eight years or so, and it really is saddening how central government has time and time again refused to act on legitimate criticism of its failed policies.

As a local councillor, I have been involved with numerous planning battles – both in terms of policy and actual planning applications – and, on many occasions, it has been so dispiriting.

It is particularly galling when housing developments do not have enough affordable housing or, on occasions, no affordable housing at all.

Many young people will not remember but at the turn of the millennium it was possible to buy a new two-bedroom house in mid Cornwall for under £50,000, or a three-bedroom house for under £60,000. Rents in the private sector were also much more reasonable.But since then, the housing market – both for purchase and rent – has become truly dysfunctional. House prices pretty much tripled in the decade after 2000 and the cost of renting in the private sector also exploded.

At the same time, wage increases have been very modest and the gap between household incomes and basic housing costs has become so much greater.

Housing ministers in the UK Government have acknowledged that house prices in Britain are "too unaffordable" but they have done nothing to reduce the cost of renting or purchasing a house, which is so needed in low wage areas like Cornwall.

They have even redefined what can be termed “affordable housing” and made it more expensive, while cutting funding and discouraging the provision of less expensive social rents that have traditionally been provided by councils and housing associations.

This all needs to change and there is so much that the UK Government should be doing. Here are a few suggestions for starters – (i) increased investment in a public rented sector with rents kept as low as possible, (ii) legislation to control prices in the private rented sector, (iii) action on second homes, and (iv) the devolution of all aspects of planning and planning policy to Cornwall.

[This was my article in the Cornish Guardian on 17 October].