The UK is a poor country masquerading as a rich one. Anyone who read the FT several weeks ago would have picked up on a story of how Britain could now be as a poor as Mississippi, the US’s poorest state.
Recent data showed the UK grew just 0.2 per cent during the second quarter of the year and inflation, while falling, is still persistently above the US, at 6.4 per cent. We’re not quite with Mississippi yet largely thanks to London and bits of the southeast but we’re not far off.
Why are we in the doldrums? Years of underinvestment is part of the answer but what drives the underinvestment. It is of course NIMBYISM unleashed by the UK planning system. Every wiggle costs us, every project be it road, rail, air or shelter that doesn’t happen impoverishes us.
Look at HS2. It’s coming in at an eye watering £396mn for each mile. In neighbouring France its latest 188-mile stretch of its own high-speed network in 2017 cost £46mn per mile in today’s money. It’s the same with our roads. The UK is an outlier compared to other countries.
A roughly 0.01 mile increase to a planned piece of infrastructure comes with an additional $9.7 million price tag as calculated by a recent study by American economists well worth reading.
So, for every pork barrel deal we have done to appease backbench MPs who have HS2 running through their constituency and for every concession on road building brought about by Nimbys, we the nation pay the price. And these are the projects that actually make it off the drawing board.
Britain’s infrastructure is in a sorry state, way behind most other countries for urban rail systems. Only 8 of British towns and cities have tram systems, we sit far behind even laggards like the US on this count. How many times have we heard about Leeds getting a metro system? It’s not just transport. When was the last time we built a reservoir in this country: 1992.
Investment doesn’t happen because the UK planning system leaves us all quaking in our boots. The planning system offers us little certainty but guarantees high cost. It deters investment rather than encourages it. It has slowly throttled our rail expansion, road construction and is in the process of sealing off housebuilding in many parts of the country. The result is we are all weakened.
