Five hundred million here, five hundred million there: pretty soon you're talking real money
Tata snags a billion quid from a government desperate to avoid negative headlines
The UK government wants the UK to have a ‘gigafactory’. These places are expensive, and need cheap energy. China is miles ahead of the rest of the world (maybe with the exception of Japan and Korea). The UK has eye-wateringly expensive energy, but doesn’t have blanket subsidies for industry to shield it from the cost.
The UK doesn’t want steelworks to shut down because, well, the UK wants to have zero net carbon emissions by 2050. Not only doesn’t it want to have them, it has enacted legislation to this effect. Steelworks, especially ones using blast furnaces, produce a lot of CO2. Oops.
What is the government to do about these problems. There is no magic money tree, but there is a cynical ‘stop bad headlines’ money tree. Tata is being bribed to open a battery factory and to not close the steel works in Port Talbot. Jingye Group, the Chinese owner of British Steel, is being bunged a similar sum to keep Scunthorp open for a while. Nobody is sure how long, but presumably the deal is that no announcement of redundancies must be made before the election.
I am reminded of the story of two blokes on a camping holiday. They see a hungry grizzly bear approaching. One starts to put his running shoes on. The other says “You’ll never outrun that bear. Grizzlies can get up to a speed of thirty miles an hour;” the first says “I don’t need to outrun the bear. I just need to be able to outrun you.”
The blokes are Labour and the Tories. They know they can’t fix the economy, or reverse the rise of inequality, or bring UK school students up to the level of our OECD peers, or stop the NHS killing people, or build enough houses that ordinary workers can afford them, or, frankly, stop the bloody boats. They just like to make some anodyne statements that makes each of them sound a bit less incompentent than the other.
The lack of seriousness in governing the country properly is highlighted by the decision of the prime minister to appoint Grant Shapps as minister of state for defence. I think that the ministry largely exist to provide lucrative jobs with defence contractors for retiring generals and would secretly like to abolish it. But even I know that in the realpolitik world in which we live this is impossible and that we do need someone with a deep understanding of conflict, diplomacy, the armed forces and international relations to do this job. I find it extremely hard to believe that the current minister has that understanding, but more importantly, I find it hard to believe that the senior civil servants and top brass will find Shapps remotely credible in the role.
I may be completely wrong. It may be that Shapps will tap into the stream of free-flowing billions that were found to propping up our lame duck industries. Nowadays, the success of a minister seems to be measured by the extent to which he can resist the Treasury’s attempts to cut his (or, increasingly, her) budget. We will see.