Debates between Lord Ravensdale and Lord Adonis

There have been 1 exchanges between Lord Ravensdale and Lord Adonis

1 Thu 11th June 2020 Covid-19: Recovery Strategies 2 interactions (777 words)

Covid-19: Recovery Strategies

Debate between Lord Ravensdale and Lord Adonis
Thursday 11th June 2020

(8 months, 3 weeks ago)

Lords Chamber

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Lord Ravensdale Portrait Lord Ravensdale (CB) [V]
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My Lords, I congratulate my noble friend Lady Hayman on securing the debate and declare my registered interests. Over the past few days, we have heard the forecasts of the scale of the hit that the UK economy could take this year. Investment is needed on a massive scale to rebuild the economy post Covid. It is essential that this investment focuses on building back better.

We have seen the devastating effects of one ecological crisis in Covid. This must surely focus minds on working to avoid another, in the form of climate change. We must use post-Covid investment to focus on key recovery and our net-zero targets. The macroeconomic case is rock solid, with the Government able to borrow at negative real rates to invest in clean industries with high rates of return.

A key gap is investment in nuclear. Nuclear is currently the only mature low-carbon technology that can provide large quantities of firm, non-variable power into the grid. To mitigate the risk of no firm power alternative being available to meet the 2050 targets, the build rate of nuclear needs to expand significantly. The key issue remains the cost of capital, and the Government urgently need to clarify their approach to funding new nuclear. Will the Minister clarify in what timescales a decision and announcement will be made on the model for funding new nuclear?

Fairness must also be a priority of the recovery. Thousands of new high-skilled jobs are needed to rejuvenate and level up the regions of the north and the Midlands, where I live. We need an evidence-based plan for recovery that fits these regions. Data must play a key role in how government policy is targeted. I highlight the excellent work of the Midlands Engine Economic Observatory’s independent economic review; it provides a unique dataset on the Midlands economy, which should be a key reference point for designing a recovery plan that fits the Midlands. Does the Minister agree on the importance of this data, collated at a regional level, to government policy-making regarding the levelling up agenda?

Lord Adonis Portrait Lord Adonis (Lab)
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My Lords, I congratulate the noble Baroness, Lady Hayman, on her excellent speech, and indeed on her starring role in this House last week. I also congratulate the noble Lord, Lord Forsyth, on his following speech, which linked the potential problem of mass unemployment after this crisis with meeting the green agenda. It is stark staring obvious that we need a Keynesian boost after this crisis, linked directly to providing green infrastructure, which we will need as a society for the next generation. We also need what the noble Lord, Lord Forsyth, mentioned: an opening up of the economy, so that people can get back to those companies that are working at the moment in as safe and speedy a way as possible. We need to put the two together.

Having been in government and seen these situations before, particularly in the aftermath of the 2008 and 2009 crisis, I know that it is one thing to say that we need a big programme of public works and quite another to have shovel-ready projects. There is one massive shovel-ready project ready to go: HS2, the biggest infrastructure project in Europe. The Government have already let £16 billion-worth of contracts for the first phase of HS2 from London to Birmingham. More than 10,000 people are employed. More than 200 construction sites are in operation, with HS2 staff on them. That is almost all of the construction sites for HS2—they have been specially prepared with social distancing and the other measures needed to ensure that the work can proceed.

It is very clear what we need to do: we should accelerate the building of HS2 north of Birmingham. Legislation is before your Lordships to take the line up to Crewe. The detailed route planning has been done through to Manchester and Leeds. We should take the advice of Martin Sandbu, the FT columnist, in his excellent new book The Economics of Belonging. He argues that we should take a leaf out of Franklin Delano Roosevelt’s book of the 1930s and have an equivalent approach to that of the Tennessee Valley Authority. We should accelerate the building of HS2 to Manchester and Leeds; legislation should come before this House to get the line all the way up to Manchester and Leeds by 2030. We should get on with it.

At the end of this debate, the Minister has a golden opportunity to agree to that, and to unleash the huge constructive potential of HS2 to generate tens of thousands of jobs across the country, and, ultimately, even to take it up to where the noble Lord, Lord Forsyth, lives, in Scotland.