If there is a soundtrack to the current events in the United Kingdom, if would almost certainly be Frank Sinatra’s My Way. It just seems so apt.
Why? Well, for starters, no one but the British can take the blame for the current economic mess they are now deeply mired within.
Take the HS2 project, as an example. It’s the high-speed rail network that originally supposed to link much of northern England to London and was the pet project of former prime minister Boris Johnson. As with all such mega infrastructure projects, there was a hefty price tag to match, but heck, what are multiple billion pounds overruns to hard-pressed taxpayers anyway!
The sum of £30 billion was first floated as the cost of linking Manchester and Leeds to central London is just under two hours. Then it became £50 billion. And what the costs now are anybody’s guess. Except that it won’t be going to Manchester or Leeds. No.
Massive ground and excavation works
It terminates at Birmingham, allowing commuters to get to offices in London in under 70 minutes. That was the plan — and much of the area around Euston Station had been ripped apart in massive ground and excavation works in anticipation of the arrival of the HS2 services sometime — maybe 2026, maybe not — sometime down the road.
Ah yes, that was indeed the plan. But things are bad in the UK right now — so much so that senior officials in charge of the HS2 project had the temerity to suggest that the line might not actually go to central London.
That would mean that commuters trying to get to London would be left in the northern suburbs and would then have to transfer to another rail line — and then the Underground — just to get to work. And that kinda defeats the whole object of the vanity project anyway: “Euston, we have a problem,” as it were.
Common sense of sorts prevailed, with Jeremy Hunt, the Chancellor of the Exchequer, entering the row to say that billions of pounds more would be available to ensure that the HS2 would indeed reach Euston.
A cash-strapped UK
These billions come at a time when the UK is very cash-strapped indeed. Regular readers of this column will know about the long list of industrial disputes underway, the chronic state of public services, social care — anything and everything upon which the British public rely on for education, health, welfare, water, safety, policing — all are short of funds, broken by a decade of funding cuts, and are maned by staff who are sick to the teeth of poor conditions and poorer pay.
The costs for HS2 have doubled, and there
is growing unease over how much they will
eventually cost those hard-strapped British
taxpayers. Or indeed why?
But somehow, the government of Prime Minister Rishi Sunak will find more money to pump into HS2. Basically, they can’t abandon the project or have it terminate short of the truncated line from Birmingham to London. To do that would be extremely embarrassing indeed and say a lot about the UK’s inability to complete such infrastructure project that seem so normal everywhere else around the first world.
But the UK economy isn’t like others in the leading club of nations. According to a report from the International Monetary Fund, the UK economy will be the only one in the G7 group of nations and those associated with the club, to fall into recession in 2023.
All have the same basic conditions to overcome. Inflation is a problem for central bankers and governments trying to use
interest rates and other economic levels to balance between higher costs and keeping their economics growing.
All have endured the fallout brought about the coronavirus. All borrowed huge sums of money to ensure that when the lockdowns were over, there would be businesses and companies to revive again.
Shock waves of higher energy prices
And all have endured the shock waves of higher energy prices brought about as a result of the conflict currently underway in Ukraine.
But none of the others have had to contend with the effects of Brexit — a self-imposed body blow to their internal political economy
According to Bloomberg Economics, Brexit has delivered a £100 billion a year hit to the UK economy. Just think of the HS2 routes that could have built!
Since officially leaving the European Union three years ago this week, UK investment has grown at 19 per cent less that the G7 average. That equates to a 4 per cent forfeiture of growth.
The timing of the Bloomberg data came on the same day as Sunak marked — “celebrated” seems wholly inappropriate — marked 100 days in office.
On the plus side, that a good 56 days more than his predecessor.
On the negative side … For starters, having to fire Nadhim Zahawi, the chairman of the Conservative party for not one, but seven, separate breeches of the ministerial code for been less than economic with the truth over his tax affairs — including a stint when he was the Chancellor of the Exchequer and responsible for all tax affairs in the UK — didn’t make for a good week.
The costs for HS2 have doubled, and there is growing unease over how much they will eventually cost those hard-strapped British taxpayers. Or indeed why?
Mick O’Reilly is Foreign Correspondent at Gulf News. Source: Gulf News
