Stability, investment, infrastructure and skills (response to the Kings Speech)

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Following the Kings Speech which sets out the agenda for the the Government, there is a series of debates in both the Commons and Lords. Each day takes a different area of public policy. Earlier this week nearly 80 peers put their names down to speak on the business and finance debate. Opening for the Government was the new minister for science Sir Patrick Vallance. He had an impressive debut. I was first off for the Liberal Democrats and after the opening niceties, here is what I said.

After years of an out-of-touch Conservative Government who took people for granted and left so many things needing to be done, this King’s Speech is very much being portrayed by the Government as a start to putting things right. The people who voted either Labour or Liberal Democrat crave these changes, so we welcome the intentions articulated in this King’s Speech and agree that the commitment to uniting the country is vital.

Given the paradoxically marginal nature of the Government’s overwhelming?majority, unification should come, wherever possible, by reaching across the aisles. We have to reach agreement and work for the stability that we all crave. These Benches will work with the Government where we can to help deliver the changes that our voters so eloquently articulated, in that election.

I will focus briefly on stability, investment, infrastructure and skills, and leave it to others to talk about the important need to better facilitate trade with the European Union, and some technology issues.

The Government have quite rightly made growth their primary objective, and recognise that stability is needed to create the ground on which this can flourish. With the Budget Responsibility Bill, the Government are seeking to anchor economic responsibility into law.

However, stability is more than just a law. Stability is projected by how the Government behave, how they make decisions and how they co-operate in the public and private spheres. That is where stability will come

We very much welcome the news of a statutory industrial strategy council to oversee industrial policy. At the same time, this King’s Speech tacks very much towards bigger government, with state?intervention?on energy, transport and planning. As I am sure Ministers opposite recognise, success will depend on getting the balance of government involvement right because, in the end, it is private investment that will deliver the growth that we need. For all the potential money in the National Wealth Fund, meaningful growth will come only if private investment flows. Unlocking that flow of investment is absolutely crucial.

Given we already have a?UK Infrastructure Bank?and the?British Business Bank, and the Government say that they will start by operating through one of these anyway, I would be grateful if the?Minister?can explain why a third institution is needed to focus what is going on. Can the Minister say what, typically, will the national wealth fund be used for? How will its investments be decided?* Will decisions be purely commercial or will strategic issues be included? Will the fund take stakes in businesses? How will those stakes be used—passively or actively?

As we have heard, infrastructure is crucial to delivering growth. To date, much of the commentary around the planning and infrastructure Bill has focused on housing. Of course, housing is vital, but when it comes to national productivity it is going to be transport, energy and digital infrastructure that will drive that productivity.

Past Governments have made similar, perhaps less ambitious, plans to tackle the infrastructure challenges we face, but inevitably there is a big time lag before things start to happen. For all the talk of shovel-ready projects, these are few and far between. Ironically, the one shovel-ready project with a proven positive effect on national productivity is the northern leg of?HS2, which the Government seem to have decided not to revive. Perhaps the Minister can explain why.

On a wider point, the Government’s planning proposals will be challenging to put in place, and we believe that planning must properly involve in some way the communities it affects. The delivery of big infrastructure projects is also an issue, as I am sure all of us in your Lordships’ House note. It was surprising that the Government decided not to give the?National Infrastructure Commission?a statutory role in overseeing national projects. Can the Minister explain how the commission, the UK Infrastructure Bank and the national wealth fund will work together, first in the creation of the long-term plan that was discussed during Questions today and then to improve project delivery once these projects are undertaken?

Finally, I turn to skills. The central question I have on the whole government agenda is: for all the Government’s targets, who will lay the bricks, insulate the houses and bring the electricity grid into the modern era? The Skills England Bill seems to lack urgency. Can the Minister explain the timetable for the development of both a plan for skills in this country and its implementation? When will we see any effect from it on the actual workforce?

In coming from the cafeteria today I caught sight of the?Prime Minister?talking about a migration strategy around skills. It seems clear that, at least in the short term, a sector-based migration strategy will be needed. It would be helpful if the Minister could explain what the Prime Minister intends.

I have one other quick win for the Government: they could turn the apprenticeship levy into a wider, more flexible skills levy straight away. We do not need consultation. Everybody who comments on this knows that this is what needs to happen, so why not do it now, and start the process of retraining a broader group of people? There is money left over from the apprenticeship levy that is not being used for skills.

It remains for me only to repeat that uniting the country requires a broad approach to deliver both benefits and stability across our country. We on these Benches will engage positively in all the discussions from this King’s Speech and beyond to assist in delivering the stability that this country needs.

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*In the main the questions in this speech remain unanswered. But in an answer to an oral question made subsequently the Minister said that the National Wealth Fund will decide on investments in the same way that the UK Infrastructure Bank does. Which further begs the question as to why a new Fund is needed at all.