This week the man of the moment and the hot favourite to lead the Conservative Party in to the 2020 election, George Osborne, spoke at the Conservative Party conference in Manchester. In what was a less showy speech, Osborne instead of pulling a rabbit out the hat he decided to deliver a speech that was rather more technical than usual.
Throughout his speech to conference was the phrase ‘we are the builders’ and to underline that, he announced the National Infrastructure commission, and reform to local government funding, which will see the abolition of the local government grant and in return councils will be able to keep all the rates they collect, with local authorities getting 100% of their rates by 2020. Osborne will also give each authority freedom to set their own rates, as he announced plans to abolish uniform business rates.
Once in place newly elected mayors would have the power to raise business rates by 2p in the pound with the approval of the majority of businesses on the local enterprise partnership. The idea being that businesses will in return gain greater investment in local infrastructure. Councils will also be given the ability to lower business rates to compete with other areas for trade.
If a lot of that sounds familiar to you, then that well be because it is from Labour’s 2015 general election manifesto and was designed by Lord Adonis, who is soon to become a cross-bench peer and chair of the National Infrastructure Commission.
The poaching of such a high-profile New Labour figure - the driver of Blair’s academy school programme and HS2 - will be seen as a highly political move as the Conservatives seek to adopt Blair’s “big tent” approach as a way of occupying the centre ground of politics.
The new commission, which will be modelled on the fiscal watchdog the Office for Budget Responsibility, will advise the Government on which infrastructure projects should be prioritised. These will cover roads and rail, including HS3 (an east to west rail line), Crossrail 2 and energy projects.
Continuing on the infrastructure theme was Osborne’s announcement that he will look to encourage 89 local authority pension funds to invest in infrastructure projects by pooling their resources into half a dozen British Welfare Funds.
It remains to be seen what role the Infrastructure Commission will play, whilst its main goal will be to take politics out of infrastructure decisions (for example Heathrow) that is easier said than done, particularly when Osborne and the Conservatives have built up a narrative that has centred on this Government (the first Conservative government in 18 years) delivering the investment in housing and infrastructure the country needs.