Rock, paper, scissors

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The Chancellor and Prime Minister seem to be increasingly fond of telling us that nothing will stand in the way of their ambition for growth. According to Reeves, “Growth trumps other things”, including the commitment to a net-zero economy. Leaving aside any questions about whether a commitment to net zero actually hinders growth in any event (there are reasonable arguments to be made that it can change the nature of economic growth rather than inhibit it, but that’s a subject for another time), the government’s own actions make it clear that there are some things which growth does not trump. The most obvious example concerns the UK’s relationship with the EU. One of the easiest things that a UK keen on economic growth could do would be to re-enter the customs union and single market. It's something which could be done without ‘betraying’ Brexit, given that prominent Brexiteers argued at the time that Brexit didn’t mean that we had to leave them in the first place. However, growth might trump net zero, but Brexit trumps growth. If only net zero could trump Brexit, we could play a sort of rock, paper, scissors game. A neat closed circle into which Starmer and Reeves could quietly disappear. But Starmer's much-vaunted 'reset' of relationships with the EU appears to be little more than a Labour version of cakeism, under which the EU gives the UK a better deal without the UK conceding anything.

It is being widely reported that Reeves will announce tomorrow that, in pursuit of that magical growth, the government will give the go-ahead to building a third runway at Heathrow. Or rather, they will give the go-ahead to starting a process which means that the third runway might be in place in about 10 years from now, assuming that the project goes rather more smoothly than any large UK infrastructure project in recent decades. In terms of her self-imposed and arbitrary fiscal rules, the operational ‘benefits’ from Heathrow expansion will start to flow only a decade hence, well outside the 5 year timescale of those rules, and only after at least two general elections have taken place. Since the planning phase is going to take a minimum of 2-3 years, there’s unlikely to be any sort of boost to the economy, even in terms of the relatively short-term construction phase, until after the current government has faced the electorate.

The argument for expansion is usually presented in terms of showing that the UK is open for business. It conjures up images of businessmen jetting off to far-flung places to sell their wares to grateful foreigners, or of rich foreigners jetting in to invest their fortunes in UK businesses (preferably without anyone enquiring too deeply about the source of those fortunes), and encourages us to believe that, if only there were an extra runway, more of both of those things would happen. It isn’t quite the reality though. Estimates of the proportion of business traffic passing through Heathrow vary. This one suggests it’s around a third of all passengers; other estimates put the figure as low as a fifth. Despite its carefully cultivated image, Heathrow is, first and foremost, an airport used for leisure travel. And many of the travellers come from elsewhere in the UK, not exclusively from the London area, even if that’s where the majority come from. There’s another aspect to that last part as well. Whilst it’s obviously true that an airport contributes to GDP in a variety of ways, including shops and restaurants as well as the jobs involved in processing passengers and planes, an airport which sucks in passengers from further afield than the local catchment area also concentrates GDP geographically around itself.

Like so much else of what the current government is doing, a decision to expand Heathrow looks largely performative. Taking – or, rather, being seen to take – tough decisions (a phrase which seems to be a euphemism for decisions which will upset as many potential Labour supporters as possible) has become an end in itself. The belief that doing so will somehow magically lead rich foreigners to pour their zillions into the UK is more an act of blind faith than anything else. But it’s not the sort of faith likely to survive contact with economic reality.

Of mice, men, and politicans

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"Tough decisions".  It’s one of those phrases politicians in power love.  It generally seems to mean that they want to do the opposite of what they said that they would do before they were elected. It’s a very macho thing; apparently doing the opposite of what they promised shows great strength whilst keeping a promise is a sign of weakness.

At least, that seems to be the interpretation of a number of prominent Tories.  According to Tim Yeo and an increasingly vocal group of Tories, keeping to the promise which both the Tory party and the Lib Dems made prior to the last election not to build a third runway at Heathrow makes the Prime Minister a mouse.  To become a man instead, he has to do the opposite and build the runway. 

And to listen to some of them talk, once would think that sacking the minister who’s implementing the party’s pre-election promise is somehow enough to free the PM of any responsibility to keep to his word.

Another of his alleged ‘supporters’, Nadine Dorries has accused the PM of being a sheep in wolf’s clothing.  Again, it seems that she wants him to take decisions which run directly contrary to what he’s said he’ll do, and contrary to the agreement which he signed with the Liberal Democrats.

On the specific issue of the third runway, with his Chancellor of the Exchequer apparently wavering on the issue as well, David Cameron certainly looks to be losing the support of his own party, other than those who won their seats on the basis of that specific promise.  (Even his party’s leader in Scotland – somewhat bizarrely I thought – last week claimed that a third runway at Heathrow would be good for Scotland.)

But the question that strikes me is this.  Which is the greater sign of weakness – sticking by a clear and explicit promise, or rolling over at the first sign of internal criticism?

Just passing through

Tweet Interesting article in today's Western Mail by Martin Evans, of the Wales Transport Research Centre at the University of Glamorgan. He's picked up on a letter from a number of business leaders to The Times this week, in which it became clear that the battle lines over the third runway at Heathrow are nowhere near as clear cut as they had seemed.

There are some pretty influential business leaders here arguing that building a third runway is the wrong thing to do – and that's a long way away from the impression given previously that business was very much in favour.

There was a similar story in the Business Section of the Sunday Times. For me, perhaps the most interesting sentence was the one that talked about the need for extra capacity being "driven by transit-passenger growth, rather than improving Heathrow as a hub for the UK". In short, rather than serving the needs of the UK for good links, much of the extra capacity would be swallowed up by people who are simply using Heathrow as a convenient place to switch from one aeroplane to another.

In terms of jobs at the airport itself, of course, that may not make a vast amount of difference. Extra flights means extra jobs, although the type of job might vary. More catering, less car hire, for instance.

But there are three major issues.

The first is that investment diverted into a transit-passenger hub is investment which is not available for other purposes. And, as I've commented before, investment in high-speed rail links would be much more useful to us here in Wales. And a great deal less damaging in environmental terms.

The second is the environmental costs and impact on the local area. Even supposing one accepts a need for a transit hub (and there is room for some scepticism at least), then is Heathrow really the right place to put it?

And the third is about the business case. Certainly, the businesses directly involved will gain major benefits – but from the perspective of UK plc, wouldn't we really be better off trying to plan capacity around the needs of those who are actually coming to or going from these islands, rather than those who are just 'passing through'?

To fly or not to fly

Tweet It seems certain that the UK Government will today give its stamp of approval to the scheme for a third runway at Heathrow, and that the scheme will include a new rail hub at the airport as well.

I think that the reference to a rail hub first surfaced in The Sunday Times, the week before last. The idea was being floated by the Transport Minister, Lord Adonis. His argument included the idea that such a hub would link the north of England and Scotland to the European High Speed rail network, so that some travellers could use the opportunity to avoid air travel completely for short haul flights to the continent. In short, it was an attempt to put something of a green spin on the Heathrow announcement.

I've argued before that we should be planning to connect Wales to the European network of high speed trains, so my initial reaction to the article was quite favourable. On further reading however, there did seem to be two significant pieces of the jigsaw missing.

Firstly, it was not at all clear to me how exactly the hub would be linked into the high speed network at St Pancras, on the east side of London, which seemed to be the plan. The implication was that it would be by tunnel under London - and a different tunnel from the CrossRail project which has already been approved. But CrossRail has taken many years to get to this stage, and it's not just cynicism which left me wondering whether a second East-West tunnel under London is really going to happen.

Secondly, there is absolutely no intention as part of this plan to build a high speed link from Heathrow to South Wales. That would have to be a separate future project. Despite the Western Mail headline, the government is not about to announce a high speed link from South Wales to anywhere.

Without answers to those, pretty fundamental, questions, I have to say that it looked to me that what we were left with was a diversion of the existing 125 trains from South Wales to Paddington onto a new track which allowed them to make an additional stop at Heathrow. And the main function of that has nothing to do with connecting South Wales to the European high-speed network, and a great deal to do with enabling passengers to use the extra capacity planned for Heathrow without having to travel there by road. In short, it's more to do with 'selling' the third runway and the Heathrow expansion plans.

Yesterday, the Assembly government announced its support for the plan. From the terms in which they were talking, it seems quite clear that they understand the weaknesses outlined above, because they seem to have been talking solely in terms of the advantages of Wales having a direct link to Heathrow airport.

I'm not as convinced as the Assembly government seems to be that connecting South Wales to Heathrow will have a significant effect on economic development. If the scheme is genuinely part of a wider scheme, albeit long term, to provide high speed rail links to Europe, then I'd certainly support the rail hub idea – but as an alternative to air travel, rather than as a means of facilitating it. I'm not convinced about the idea that the planned expansion of capacity at Heathrow is the right thing to do, and I have real concerns that linking the two issues means that we still aren't taking a sufficiently strategic view about the relative importance of rail.