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Artillery Row

The Tories have a nostalgia problem

Modern leaders must focus on modern problems

With the Conservative Party leadership contest well under way there has been a striking similarity between most of the candidates: a preoccupation with icons of the past. Take the candidates, for example, who have sought to emulate Margaret Thatcher — even going so far as to promise that they will govern like her.

Some candidates have pointed to the size of the public sector as a problem while others have taken shots at trade unions. Again, these are not really issues anymore. Perhaps we could reduce staff numbers in the civil service, and the train strikes were certainly inconvenient, but they are hardly the biggest problem facing our country right now. This is not the 70s with a massively bloated public sector, nationalised industries, and powerful unions holding the country hostage.

In short, the people vying to be our next Prime Minister seem to be obsessed with fighting the battles of the past. In many ways this is understandable. They are hoping to lead the Conservative Party and so it is convenient for them to point to impressive figures from the past such as Thatcher and Churchill, who the (predominantly older) membership so admire.

Although it may be understandable, it is the wrong approach to take. For all their flaws, Churchill and Thatcher were successful because they identified the main problems and dangers facing Britain at the time and took decisive action. As such, Churchill helped to rid the world of fascism and Thatcher transformed the UK from the Sick Man of Europe into a thriving and open economy.

The fact that the candidates keep referring to the past should worry us all. It suggests that they have very little understanding of the issues facing the country today — and if they do then they are lacking credible solutions. 

We need leaders

This is deeply concerning. The UK is in decline with rampant inflation and a productivity crisis. We have already experienced one lost decade, where real incomes have failed to grow and we look set for even more stagnant economic growth. As such, we need leaders who not only grasp the dire situation the country is in, but also understand why, and who have an ambitious and workable plan to fix it in order to deliver economic growth.

As I have pointed out for this magazine before, the main thing holding our country back is the housing crisis. The restrictive planning system has meant that supply has failed to keep up with demand. As a result, people — especially the young — are paying a fortune in rent without a realistic prospect of ever owning their own home. This is causing huge problems and has latched a devastating chokehold onto our economy.

The next Prime Minister needs to realise the scale of this problem and the damage it is causing. They also need to understand the solution: build more houses. They will have to take on the rent-seeking NIMBYs who seek to stand in the way of progress and development. It will be a tough fight, but it is one they must win.

Then there is childcare. The country needs more children, as they have the potential to devise innovations which will grow our economy and enrich our culture. In more mundane terms they will also pay the taxes we need to fund the care of the elderly. 

Unfortunately, we make this difficult due to housing shortages and the fact that childcare is prohibitively expensive. Not only does this mean that young people have fewer children, it also means that our economy is missing out on the skills and talents of the women who are shouldering a disproportionate burden of childcare. As such, not only are we making it more difficult for 50 per cent of the population to flourish but our businesses are not as productive as they could be.

The government needs to be bold

Again, the government needs to be bold here. It should spend more money to subsidise childcare. It should also look at ways to increase the supply of childcare providers by liberalising the system and encouraging migrants to come to the UK to do the job.

We also have to look at the support we give to parents. The two child limit on benefits is as cruel as it is pointless. While there is little evidence that it has impacted fertility rates, it has plunged families into poverty. It is not acceptable that children are going hungry. Not only is it immoral, it impacts their development and ability to learn, thereby stifling their ability to learn skills they need to contribute to society.

The idea of spending more money will go against the instincts of officials and politicians with “Treasury Brain”. It is obviously right that taxpayers’ money is spent carefully, but this doesn’t mean that we shouldn’t be prepared to spend money on things which have the potential to improve all our lives.

Take education for example. Children are the future innovators, scientists, and leaders of our nation. Our teachers do a great job and they are dedicated to educating our children. Unfortunately their work is stressful and low-paid so it is difficult to attract and retain high quality teachers. We should be prepared to pay teachers – especially those in key subjects such as Science and Mathematics — a lot more money. We should also spend more money providing lifelong skills training so that adults can be more productive and equipped for the jobs of the future.

We should also look at technology and innovation. The UK is a world leader in terms of technology, with some of the smartest and most innovative people in the world working on major challenges. However, we spend less as a proportion of GDP on research and development than the US, Germany, France, or the Netherlands and less than the OECD average. What is more, despite our universities being among the greatest in the world, they are often vilified by the government, including some of the leadership candidates. We should recognise and appreciate just how great many of our universities are and what an asset they are to our nation. As such, we should dramatically increase public spending on R&D.

We could improve the life chances of young people

Finally, let’s invest in transport infrastructure. We are embarrassingly far behind compared to much of Europe when it comes to high speed rail. We could improve the life chances of young people, especially in more deprived parts of the country, while also massively increasing productivity if we linked their towns and cities with high speed rail.

To address this “Treasury Brain” approach to public policy, Kemi Badenoch’s suggestion that the Treasury be broken up and replaced with an Office for Economic Growth is interesting. However, she is wrong to say it should be run from Number 10. We should follow the proposal set out by Stian Westlake, executive director of research at the National Endowment for Science, Technology and the Arts, and have a Department for Economic Growth merged with BEIS, with all the prestige of the Treasury and a focus on bringing about economic growth. The Treasury’s other functions could be implemented by small new departments or subsumed by existing ones.

We can learn a lot from history, but we do not want leaders who are living in the past or obsessed with fighting old battles. Our country is in decline and we need forward-looking leaders who understand our issues and have ambitious and workable solutions.

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