Outlook: Hard hats may be en vogue, but be wary of Alexander’s insurer-investors


Here’s a Westminster fashion tip: hard hats and dayglo jackets will be so 2014. Ministers will be dressing up like that bloke out of the Village People on a near weekly basis for their photocalls as the Coalition plugs its infrastructure spending plan investments.

Danny Alexander, the Treasury Secretary, grimly condemned the dismal legacy of low infrastructure investment in this country earlier in the week, and was parroted by the Chancellor, George Osborne, yesterday.

I’d say such statements take some bottle. For it was this administration which slashed government infrastructure spending as one of its first acts when it came to power. The Labour government brought spending forward in the immediate wake of the financial crisis as the Keynesians ruled the roost back then. But that policy was dramatically reversed after the election.

An indication of such spending is public sector gross investment as a percentage of GDP. On that measure, in 2008 and 2009, Labour’s was 4.8 per cent. It plunged as low as 1 per cent in 2012-2013 under the Coalition. Now they are planning to bring it back up to 3 per cent.

Even at the new upwardly revised figure this week, that is broadly in line with the spending of the previous decades, which Mr Alexander himself this week condemned as having been a period of “underinvestment”.

With the absence of Government spending, the slack is being taken up by the private sector. Nothing wrong with that, as long as the private investors don’t run rings around the taxpayer – a recurring theme under numerous Labour PFI scandals. But that aside, we should be sceptical about the promises – repeated in the Autumn Statement – for the insurance industry’s £25bn investment pledge.

As anyone who’s tried claiming on an insurance policy can testify, these companies seldom make promises without the legal wiggle room to avoid paying out. Furthermore, they are, understandably, going to be seeking only lucrative, and safe, returns for their cash – hence Legal & General’s enthusiasm to invest in the one-way bet of property.

While any increase in infrastructure spending should be applauded, we should not be fooled by photo-op politicians’ pledges.

Chill economic winds take  a turn south to Australia

In case you’d missed it: the economic downturn is catching up Down Under. Having gracefully avoided the worst of the financial crisis thanks to its mineral wealth and supply ties to China, the dramatic end of the commodities boom this year has hit the country’s economy hard.

This slowdown is now catching up in the consumer side of the economy. Qantas’s shocking announcements yesterday were as bleak as they come: 1,000 job cuts, a warning of “immense” challenges and a profit warning. The largest airline in Australia predicted a half-year loss of up to A$300m (£165m in our money).

The chief executive Alan Joyce wants to blame much of it on the subsidy being granted to Virgin Australia, which has received A$350m. He’s got a point, although Sir Richard Branson, of course, has wasted no time in declaring such  talk nonsense, arguing that Qantas is just badly managed.

Neither want to talk about the economy, though, as that would damage the valuations of their businesses. But the chill economic winds blowing in from Asia are surely the nine-foot kangaroo in the room.

Don’t pity the young too much – they’ll live longer

Being the wrong side of 40 and smack bang in the middle of the age-range to be clobbered by the new State Pension Age, I have to say, the change in policy was about as predictable as the ageing process itself.

Nobody I know of my age expects to be retiring until we’re well into coffin-dodging territory.

Then again, none of us seriously takes into consideration the State Pension when pondering what our perilously small incomes are going to be like in our dotage. Being children of the Thatcher era, we have grown up not to trust long-term pledges on state benefits.

We in our 40s, if we’re lucky, just managed to hop on board the property chairlift before it shot up the mountain and out of reach, so we have our pensions built up in the roofs over our heads. But as for savings, forget about it: the mortgage eats any spare cash at the end of the month.

Pity those in their 20s and 30s, then, who have similarly missing savings (due to exorbitant rents they pay for their homes) and also no property to their names.

But there is, of course, a trade-off. The 40-somethings will be expected to work well into our 70s, but in what jobs? Most employers already seem only to be seeking whippersnappers barely out of school with low wage expectations and an unquenchable enthusiasm for long hours. As the commercial world becomes increasingly tech-heavy, by the time we, ahem, lower middle-aged, computer illiterate Luddites are in our 60s, the average working age will probably be down in the low 20s. We will be unemployable, even at silver-surfing B&Q.

So there it is, then. Come the middle of the century, my generation will have no jobs, no pension and dwindling health. The latter is the main argument in our favour, of course: the younger generations accuse us of stealing their futures, but at least they’ll still be alive. e Al-Faw peninsula. His colleagues recalled constant skirmishes on the road to Basra; on one occasion a rocket-propelled grenade bounced off the armoured car  in which he was travelling.

Blackman received a highly favourable end-of-tour report and was recommended for promotion. He undertook two more tours of Iraq and more in Afghanistan. It was during his final deployment, with 3 Commando Brigade, that he carried out the killing which landed him in the dock.

The brigade suffered many losses on the tour, with seven killed and 40 wounded, and the court martial heard that the Taliban had hung body parts of members of the British military from trees as “trophies”. But as the tour neared its end in the autumn, the security situation was calming down in most areas under the brigade’s supervision.

Indeed, the sergeant made a considerable effort to build up relations with the local community, attending shuras – village meetings. But then came the death of the prisoner: cold-blooded murder, according to the prosecution, or, say his comrades, the snapping of a man who had spent too long in a world of violence and strife.

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