Britain must believe in itself if it is to win the confidence of the world
The UK has so much to offer global business – but must be sure to make the most of its advantages
Ispend a good deal of my time these days travelling overseas, in America, Asia and Europe. Wherever I go, given my past roles in government, people ask me about the condition of the United Kingdom. It has to be admitted that the combination of events over the last year has not made a good impression on the rest of the world. Most foreign governments and international businesses could not understand why we voted to leave the European Union, having not experienced themselves its disadvantages. But it is the outcome of this month’s general election that has produced feelings ranging from frustration to pity, that a great democracy can tie itself into such knots.
Viewed from afar, Britain now looks to many people to be a lot less stable than most of supposedly crumbling Europe. It has voted for Brexit but refused to give greater authority to anyone to negotiate it. At the same time, a hard-left form of socialism that was assumed to have been killed off in the Blair era is back and rampant, with the prospect of a nationalising, high-taxing, bigspending, crypto-marxist ministry coming to power in the next instalment of this unpredictable electoral sequence.
Terror attacks and the tragedy of the Grenfell Tower fire have only added to the gloom. Read the headlines around the world and the UK seems suddenly to be unlucky, uncertain and divided. A British speaker at international conferences is greeted with anxious questions, addressed as if to someone who has just been given leave from a battlefield.
It would be easy to go along with these demoralising perceptions and tell everyone that we are indeed in an irretrievable mess. Yet I find that I just can’t do that. Partly, this is the simple patriotism of someone who has been Foreign Secretary – however bad things get, I am not going to tell other countries to lose confidence in the UK. But in addition, I still genuinely believe we have a lot going for us, and that our long-term prospects are, or can be, better than those of most countries. Showing we are able to make the most of that is the way for my old colleagues in the Cabinet to get through Brexit, defeat Jeremy Corbyn, impress the world and unite more of the country in the process. The more difficult the situation, the more selfbelief and reasonable optimism are required, along with some noticeable demonstrations that we mean it.
Self-belief does not involve being blind to our own faults. We now have an excessive level of household debt, fuelled by interest rates being too low for too long, but we have that in common to varying degrees with many other economies. We have clearly failed to integrate different cultures into our society, but that failure is apparent across most of Europe. We face the growing issue of a young generation being worse off than their parents, but young people in Italy, Spain, and France have similar issues with much higher unemployment at the same time. These and many other problems of advanced Western societies are important to deal with but are not remotely unique to the UK.
What is unique to us is having to negotiate a reasonable exit from the EU. There is no escape from that bogging down Parliament, preoccupying many ministers and worrying businesses. The precise details will make a big difference to large numbers of families and firms. What I tell people overseas, however, is that in 20 years’ time, those details will not be the main determinant of our success or failure as a country.
A country can be in the EU and still be an economic wreck, like Greece. It can be outside and still very successful, like Switzerland. The decisive factors for long-term prosperity are having a tax system that favours enterprise, being a centre of creativity and ideas, being open to trade and investment, having good education, and building infrastructure and housing for the future.
On most of these matters, Britain has many advantages, which is why we have three million more people in work than only seven years ago. This has become one of the easiest countries in Europe to start a small business or to invest from abroad as a big one. Business taxes are low. We are a centre of new ideas, from film-making to new technologies to finance. Four of the top 10 universities in the world are here. We are about to complete, in Crossrail, one of the greatest of all infrastructure projects. There are many reasons not to walk around looking depressed.
When I mention all these things, my foreign friends give approving nods. But what will really impress them, as they ponder their next investment, and voters at home as they watch Corbyn get over-excited at Glastonbury, is seeing a clear strategy to make the most of all Britain’s advantages.
The first step in making that possible is making a minority government more secure, and that has just been done through the agreement with the DUP. Such a deal was essential, whatever the abuse that will be directed at the Government as a result.
Then the big step is to show that, while Westminster is mired in Brexit for the next few years, and even though other legislation is difficult to pass, much will be done to project confidence for the future. Put some renewed political drive behind the third runway at Heathrow and rail projects in the Midlands and North. Create a national, cross-party plan for house-building that cuts planning delays, encourages build-to-rent schemes, and releases more state land. Reaffirm that corporation tax will keep going down. Expand the proposed new “T-levels” for technical education. Announce we will use all the freedoms of leaving the EU with innovative policies that attract particular industries, create enterprise zones and freeports, and encourage research and development. Show how we will attract foreign talent, not keep it out.
It is often said that the main or only test of this government will be the outcome of the negotiations with the EU. In my view, however, the most crucial test of all is whether it can convey that Britain will succeed over decades to come. Then, the optimism that millions of us still want to express about our country will truly be justified, not just by hopeful assertions, but by a real, visible and identifiable plan.