King’s Speech (4th Day)

Lord Petitgas Excerpts

Monday 22nd July 2024 Lords Chamber

[Lord Petitgas (Con) (Maiden Speech)]

My Lords, let me start by congratulating my fellow maiden speaker, the noble Lord, Lord Vallance of Balham, on an excellent maiden speech, which obviously sets up a hard act to follow. Already, as a commoner from Brittany, I must confess to a twinge of imposter syndrome as I stand here today. According to the House Library, which I completely trust, there is no record of a Frenchman in the peerage since the 13th century. For me, this truly is a case of reality exceeding fiction.

I am very grateful to my noble friends Lord Hill of Oareford, who unfortunately is absent, and Lord Johnson of Lainston for acting as my supporters back in March when I was introduced to your Lordships’ House. I have forgiven them—just—for lingering perhaps a little too long in front of Maclise’s magnificent canvases in the Royal Gallery. When de Gaulle came on a state visit in 1960, they were covered up to spare his blushes, but I got both barrels. I am also grateful for the outstanding work of the Library staff, who are every bit as efficient as the research unit of a global investment bank but with much better books, and to the doorkeepers and Black Rod, who have kept me on the straight and narrow since my introduction.

It was Bagehot who distinguished in Government the efficient from the dignified. I posit that this House unites both qualities. I believe that many countries would or should give their right arm for such an institution. The quality of debates today is astonishing, and of course we provide the long perspective; Edmund Burke’s arc of time is my personal inspiration, linking

“the dead, the living and the unborn”.

I was born in Nantes from Breton and Norman stock. My claim to being a bright student was skipping an academic year on account of being too rowdy and tall for my age. I was the first to go into business in a family of academics and fishermen. After a brief stint in the French Foreign Office, I joined SG Warburg in London, then spent 30 years at Morgan Stanley and ran global investment banking. From there, I went on to serve the former Prime Minister Mr Sunak as his chief business adviser. It is from this perspective that I will share three observations about the UK economy, before I get on to the growth dilemma.

First, let us stop talking the UK down. Our economic outlook stands out in the G7, bar the US. Growth has been coming back. I believe history will show that Mr Sunak and his Chancellor were starting to get the country back on a more than even keel. Secondly, the special relationship with the US is a massive asset as we move forward with the AI revolution. To quote Musk, outside the west coast the only other place to develop AI is the UK. We count four out of the top 10 universities. We totally outmatch Europe on technology and IP. Thirdly, I will concede—and I think it is true—that a clear political mandate typically should unlock fresh investment and economic momentum.

Let us be clear, though, that, as we have heard today, not everything is rosy. The number one issue is lacklustre growth and low productivity. We are not alone in the West—bar the US again. I therefore support this Government’s focus on growth, even though we will debate and are debating the best way to get there. The proposed top-down drive on housebuilding, industrial strategy and net-zero infrastructure may stir up the economy, but we should not forget that durable growth ultimately rests on a bottom-up liberal economic philosophy encouraging risk-taking, innovation and wealth creation.

When thinking about growth, I find it useful to go back to basics and the canonical three-factor equation of “investment x innovation x skills”. On investment, we are not short of capital, either foreign or domestic. In fact, my noble friend Lord Johnson of Lainston was formerly Minister for Investment, and last year the UK had its highest-ever FDI. The dilemma, as has been said today, is that neither UK plc nor our pensions are deployed enough in our economy. Let us keep up the reform momentum to unlock better returns for savers and deploy capital for growth.

On innovation, the second factor, we are not short of IP in healthcare or AI that gives us real edge in capturing the productivity upside, but we need to be strategic around government procurement, capital allocation for pensions and regulation. As for skills, perhaps noble Lords will forgive me if I do not go into too much technical detail and become a bit French and philosophical. In my view, happiness derives from an individual’s sense of autonomy and self-worth or dignity. The French economist Thomas Piketty is right, despite being Marxist, about capital taking the elevator while labour goes up the stairs. Inequality and imbalances in society need redressing. We certainly need more economic efficiency, but we also need social justice. This House is a place of balance, and it is a great honour as the first French Peer in 800 years to have the chance to serve here in the cause of my adopted home.