It is an odd fact of UK life that we are home to the biggest and most sophisticated international financial centre in the world, but it seems unable to meet the demand from the British public for home loans at prices they can afford, and it is equally bad at providing loans for small businesses. It is notoriously reluctant to finance the start-ups and early-stage ventures on which our future prosperity depends, and on the other side of the balance sheet it is totally unable to deliver a reasonable return to savers, either on an individual level or via pension schemes.
However adept it may be at trading international securities and selling its services round the world, when it comes to meeting the needs of the UK non-financial economy, the system does not deliver. meanwhile, society suffers because so much of the City forgot that finance exists to meet the needs of the real economy, not to be an end in itself.
One could say something similar of politics, for that activity also appears increasingly to have forgotten what it is there for. The purpose of politics should be to find ways to reconcile irreconcilable differences between people and power groups. Increasingly though, as Parliament and its environs have come to be dominated by career politicians with limited-to-no experience of the working world outside Westminster, politics has come to be seen as an end in itself.
Hence the alacrity with which politicians have become obsessed with the EU and the potentially disastrous distraction of a referendum. It is so much easier to rant about Brussels, than it is to knuckle down and find workable solutions to real problems elsewhere. Outside Westminster it is hard to find anyone who believes renegotiating the relationship with the EU is the number one problem. But it is likely to be all we are going to hear about in Westminster for the next few years.
All of which brings us to infrastructure, the blanket term for the mix of transport, communications, energy, utilities and education which form the backbone of the economy and on which our competitiveness and quality of life depends. It needs investment for expansion and renewal – some £300bn over the next 15 years, to quote a much-touted figure.
Unfortunately, little to nothing seems to be happening. Spending has fallen under this government; the construction industry has laid off tens of thousands of people through lack of work; and in so doing has added to the stagnation in the wider economy.
At a private dinner in the rector's house of Imperial College on Tuesday, industry leaders lamented the inability of politics and finance to take a long-term view of the country's needs. It is the misfortune of those who work in infrastructure that decisions about its future require bold thinking from politicians and financiers, the two most dysfunctional sections of British public life. The result is inertia.
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