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Graham's latest column for The Journal
Autumn is a time of top telly – the X-Factor and Strictly are back, but it is also the great campaigning season in politics; the time politicians set out their wares ahead of elections in the spring. This autumn the two major parties are doing battle on the economy and the cost of living. It starts with the Party conferences; l was one of over a hundred people from the North East who attended the Conservative conference. Frustratingly, I wasn’t in the hall at the moment Boris Johnson asked if there was anyone from Darlington. He was, quite rightly, pointing out that Darlington firms had being involved in the manufacture of his new London buses. But I did tell the Business Minister about the North East Chamber of Commerce’s “50 reasons to invest in the North East” campaign!
North East business is in the midst of an investment blitz. Companies from most sectors are buying equipment, training staff, promoting new products and services. The economy is picking up and the effects of growth are not leaving the North behind. In the automotive sector, Nissan and its impressive supply chain has new products and a growing workforce. In the services sector, firms are reporting increased activity. Even my own modest sized business is investing in a new office building and new people.
All the respected business organisations in the region - the Chamber of Commerce, the Institute of Directors and the Entrepreneurs’ Forum - are hearing positive news from their members. The recent Entrepreneurs’ Forum survey found that two thirds are positive about the future.
This upturn has not happened by accident. George Osborne needed to hold his nerve as he was goaded by Ed Balls about a ‘flat-lining’ economy. But George has proved his point; the reduction in business taxes, personal taxes and changes to public spending have fired up the private sector, leading to job creation and investment.
Now Labour has changed the conversation. No longer is there a need for ‘plan B’. Now it is about the cost of living; never mind that the cost of living has gone up because we have all been landed with the bills for Labour’s time in Government, when it racked up this highest public spending deficit in history.
Ed Miliband had commentators salivating over his promise to punish utility companies with a price freeze. But who was the Energy Minister that passed the 2008 Climate Change Act that added hundreds to family bills? It was Ed Miliband who, when in Government, said: “There are upward pressures on energy bills, and that makes life difficult for people, including those in fuel poverty, but it is right we go down the low-carbon energy route.” He, knowingly, passed the laws that led to the expensive bills he now complains about.
Ed Miliband’s price freeze is really a price con. The worst news is that it could lead to a damaging investment pause. The big energy companies are investing billions in upgrading the infrastructure and in building offshore wind farms to fulfil their renewable obligations under Ed’s laws. The up side is that, because our region is at the very heart of the energy supply chain, this investment is now creating thousands of jobs in the North East. The Journal has an energy supplement each week, so our readers are familiar with the growth of this vital sector to our regional economy. Is the Labour leader really saying to the North’s energy supply chain that it is worth putting jobs at risk in order to generate short-term popularity?
I like price freezes as much as the next man but politicians should only promise to freeze what they can freeze: everything else is hot air. David Cameron and George Osborne can promise to freeze fuel duty; and they have. They can promise to give funds to freeze council tax; and they have. They can promise to increase the amount of tax-free income you can earn to £10,000 a year; and they have. They can offer a tax cut to married couples; and they have. These promises are within the power of politicians in a free country and they are worth much more to the average family in cash terms than a 20-month price freeze on gas & electricity.
So this autumn, as we settle down to watch TV, voters will consider Strictly X-Factor Policies. Initially, they’ll support the joke act, but by the time of the final, they’ll get serious and go for real talent. My guess is that will be Cameron and Co.