Saving Britain's industries - one U-turn at a time

Posted on: 05 December 2011 by Alexander Hay

Coming to the rescue of beleaguered train manufacturer Bombardier, the government admits that the UK needs to start selling and making more than just hot air and expensive money

A working factory - an increasingly rare sight in the UKThe clumsiness that costs people their jobs is scant compensated by the clumsiness of a u-turn:

Provision has been made for the Government to contribute £80m towards the cost of providing 130 new carriages for Southern Railway to improve services on the London to Brighton line.

The Government hopes the generous subsidy will persuade Bombardier to keep the threatened Derby plant open.

The Canadian owned group, dismayed after losing a £1.4bn Thameslink contract to Siemens of Germany, has slashed the 3,000 strong work force by 1,400...

There is much that is revealing here. Apart from the obvious attempt by the government to undo the PR damage done by not favouring a UK-based business in a major contract, there's the small matter of that British factory being owned by a foreign company.

How did it come to this? Britain's altogether more influential (and perhaps too government-friendly) arms industry has never had to face losing a contract, despite not always providing the best value for money. The main difference for Bombardier is that it specialises in a kind of heavy industry that is treated with disdain or misunderstanding by government due to its being so rare and unfashionable these days.

It is this cultural shift, from Britain seeing itself as an industrial power to a post-industrial country that scampered as far away from manufacture and towards the service sector and high finance as it could, that has defined the UK most of all during the last 25 years. We don't make things. We buy them.

Naturally, this is profoundly short-sighted. Our balance of payments are dysfunctionally weighted against exports and we are at the mercy of worldwide supply chains.

We have also learned nothing from history. Britain's industrial decline began due to our over-reliance on four staples - coal, shipping, steel and textiles. Other countries, meanwhile, expanded into new areas as quickly as they were developed, leaving Britain behind.

Now we over-rely on new staples; banking and business, and the service sector. Much has been written on how the UK ended up selling hot air and abstract notions, but these do not provide mass employment beyond creating the need for call centres, barristas and shop workers, all dependent on the vagaries of selling a mirage and keeping consumer demand high. The decay of the high street and falling consumer demand ought to be enough to revise this attitude.

Manufacture also helps provide jobs and employment. Britain remains overly wedded to the notion of academic qualifications while technical training and apprenticeships are treated like the booby prize.

The truth of the matter is that a diverse economy is a healthy economy. There is a reason why Germany is now the most important country in the EU - it has both a successful financial and industrial sector. It values education of all kinds and it has not pursued one avenue to the exclusion of all others.

Working in a supermarket, meanwhile, provides neither sufficient dignity nor remuneration. The decline of the old working class into unemployment and social dysfunction is down to the fall of industry. Social mobility is only possible with social stability, and decent job opportunities for all.

Perhaps, belatedly, the government is beginning to realise this. Bankers of today find themselves in the same onerous position as trade unions in the 1970s, blamed - rightly or wrongly - for national malaise. With youth unemployment at 20% and the exchequer in sore need of more tax revenues, a return to a mixed economy is an idea whose time has surely come.

[SOURCE: The Telegraph]

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Alexander Hay

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