We need more than buildings and bridges for an inclusive recovery

30 June 2020

By Charlotte Alldritt

5 minute read

How to solve the Brexit Irish border problem? Build a bridge between Northern Ireland and Scotland. How to avoid the politics of a third Heathrow runway? Build an island airport. How to secure the UK’s friendship with France as we leave the EU? Construct another 22-mile crossing between Dover-Calais – this time over one of the world’s busiest shipping lanes. Our current Prime Minister has long been obsessed with physical infrastructure.

In his latest speech today on levelling up the regions and nations of the country, the Prime Minister returns to a familiar theme: schools, hospitals, roads and prisons are each expected to receive a massive injection of capital spending. But we’ll need more than buildings and bridges to create an inclusive recovery.

The Prime Minister’s heavily trailed Rooseveltian ‘New Deal’ is partly about reaping long-term economic returns on £5bn investment. It is also intended as a job creating public works programme designed to mitigate against unemployment feared to hit 10-12% of the workforce once the Job Retention Scheme is phased out. But such schemes can only be a partial and temporary solution. Many people have rested hope in a green recovery, creating up to 700,000 jobs in retro-fitting housing to meet zero-carbon environmental standards. But who will get these jobs and when do they materialise? Who will train the workforce? How long will these jobs last? Will they allow for progression within or across the construction industry or wider green infrastructure sector? We must use this time to make a step change for clean growth. But my experience of the Green Deal during the Coalition makes me sceptical that the government can deliver this kind of programme on any scale.

Addressing the capability of the civil service to deliver major projects has been trailed as a core component of No.10’s levelling up strategy. But its purpose goes far beyond this. Politically, Boris Johnson’s government is desperate to demonstrate competence. The civil service are convenient scapegoats, but it is also true that most officials are not trained or rewarded for policy delivery. Institutional reform of the kind Michael Gove outlined at the weekend – with data, evaluation and admission of failure as a source of improvement and innovation – must be the direction of travel.

But we must also put existing evidence into practice. For example, the last thing we need are new hospitals. Covid taught us what we already knew on that score. If we are to have a sustainable, world-class National Health Service we need to prioritise investment in services in the community helping people to avoid and manage long term conditions such as obesity, smoking and loneliness. Tackling the backlog of high and mounting (pre- and post-Covid) waiting lists will be a huge operational task, and one that will take time to clear. The more difficult challenge will be to double down – in finance and policy terms – on NHS England’s commitment to integrate local services and look beyond its own institutions to reduce health inequalities.

Mental health must also be front of mind for No.10, supporting children and young people as well as adults to emerge out of this crisis unscathed as possible. Children’s and Adolescent Mental Health Services (CAMHS), for example, were already under acute demand pressures before Covid-19 and much of the extra funding government had previously committed was used to backfill other budget gaps. Local government has already received additional funding to support communities during the pandemic, but there are too many cracks in the system through which people are left to fall.

Dealing with the demand on employment support services will also require a huge scaling up of local and regional capacity, as well as that within the Department for Work and Pensions. Signing millions of people onto Universal Credit within a matter of weeks is one thing, helping them to access the tools they need to find new employment or training opportunities is quite another. This will need to be accompanied by a revolution in access to skills. Next week the Centre for Progressive Policy will set out how the Conservative’s ‘Right to Retrain’ manifesto pledge can be enhanced to meet the potential scale of structural unemployment ahead and take advantage of lockdown shift to online learning.

Last week the former Chancellor, Sajid Javid, in a joint paper with the Centre for Policy Studies, made a plea to Boris Johnson not to swell the size of the State with higher taxes to pay for his building spree. Instead, they argued, government must create the conditions for a dynamic private sector to lead the economic revival out of lockdown. But if the last recession showed us anything, it is that public sector cuts do not crowd-in quality jobs. They do not drive up productivity, wages or living standards. They do not address persistent social or spatial inequalities.

But neither does investment in physical infrastructure alone, as the evidence shows. Skills, employment support, community public and mental health services will be the new frontline in the fight against the impact of Covid-19. Prioritising investment in these services is the way we create a dynamic private sector and a thriving, clean, inclusive economy.