The Lib Dem leadership — as I noted here yesterday — is determined to get on the front foot on the economy. This autumn will see a leadership-proposed motion backing further capital investment (“within the fiscal envelope”) while retaining the commitment to deficit reduction. Nick’s letter this week is coordinated with that message, and in particular the importance for growth throughout the regions of the UK. Here’s what he has to say…
On Thursday I visited the Toyota and Rolls Royce factories in Derbyshire to announce the latest round of the Regional Growth Fund: 102 new projects that will create or safeguard 77,000 jobs.
I remember first making the case for the £3.2 billion RGF back in May 2010. We knew we had to take decisive action to get control of government borrowing. But I remember also being crystal clear that cuts would not be enough to get our economy going again. We couldn’t let our industrial heartlands pay the price for the economic mess we had inherited from Labour. We had to invest where it mattered to create jobs.
That’s as true now, as we start to emerge from the worst of our economic difficulties, as it was three years ago. Cutting the deficit is vital but it’s just a foundation. We need to be creative if we want to build on that foundation: and that’s what Danny Alexander, Vince Cable and I have been relentlessly fighting for.
It’s not just the Regional Growth Fund.
In the Treasury, Danny has pioneered government guarantees to back £50bn of investment in infrastructure and housing. At the Business Department, Vince has created the new Green Investment Bank and the Business Bank to channel money to people who can create jobs.
We’ve enabled over a million new jobs, and growth is slowly returning to our economy but we cannot be complacent. The budget deficit is still likely to be among the largest in the EU. Youth employment remains stubbornly high. House building remains well below historic averages. And small businesses continue to tell us they are struggling to access the finance they need to grow.
I know the party – its members and supporters – prioritise jobs and growth above almost everything else at the moment. You are rightly looking to me, Vince and Danny to give the party strong sense of purpose and direction on the economy. So the three of us have come together over the past few months to discuss the economic choices ahead with our Parliamentary colleagues, with our councillors, with our members and with our supporters.
We’ve agreed this autumn is the right moment to set out a clear, Liberal Democrat vision for Britain’s future economic growth and prosperity. We are putting a motion to our party conference that will move us beyond the sterile Plan A versus Plan B debate and onto distinct liberal territory. Not abandoning for a moment our commitment to fiscal discipline. But not wavering, either, in our determination to find new ways to support growth and jobs.
In that motion, we’ll be setting out the Liberal Democrats’ commitment to fight in government:
- to help young people find work and training
- to get more credit to small businesses through our Business Bank
- to make the Green Investment Bank independent so it can borrow in the markets and expand
- for a creative approach to the state owned banks to ensure they lend, and banking competition increases.
Importantly, we’ll also be setting out ideas to give local councils new freedoms to invest in building the affordable homes their communities need: a plan built on the liberal principles of localism, innovation and social justice. I know just how important housing – and especially affordable housing – is to the whole of our party, across the country.
And of course, in our Million Jobs campaign we’re working to double the number of companies that take on apprentices.
We will remain committed to balancing the budget, now and in the future. Labour’s fantasy that you could eliminate the deficit by borrowing billions more is just that: a fantasy. But we can be more creative and innovative in the drive for growth, and with your endorsement at conference, we will do so.
I hope to see you there.
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* Stephen was Editor (and Co-Editor) of Liberal Democrat Voice from 2007 to 2015, and writes at The Collected Stephen Tall.