We need action, not more reviews
EVERYONE is agreed that Britain has major problems with transport infrastructure, whether it be the knotty problem of increasing London’s airport capacity or the dreadful state of the railways.
But the endless reviews never seem to help.
The Airports Commission, led by Sir Howard Davies, is expected to produce its recommendations next week and the government is expected to make a decision on where to build new capacity by the end of the year.
But the issue dates back to 1968, when a commission headed by Lord Roskill was set up to come up with recommendations for a four-runway airport in the South East. Its proposal was canned.
No doubt Sir Howard, who always seems to know which way the political wind blows, wants to wrap up and move to his new job chairing RBS, which may seem like light relief in comparison.
When his commission began in 2012, all the bets were on Heathrow, but Gatwick has sprinted up out of nowhere.
The review has to some extent been overtaken by developments in the market including the rise of low cost air travel for leisure and business. One indication is that Gatwick passenger numbers are already heading for 40m this year, a figure they were not expected to reach before 2025.
Many predict Heathrow will be recommended by Sir Howard but Gatwick will be praised to the extent that the government could go that route and not lose face.
But in any sort of sane world, both airports would already have been offered an extra runway – both would be winners.
As for those of us who travel by rail, Dame Colette Bowe will pub- lish a report on ‘lessons learned’ from the Network Rail fiasco, with £2bn of planned improvements being shelved this week.
She commands the highest respect but another review is unlikely to do that much good.
The energy sector is facing a big milestone early next month when the Competition and Markets Authority presents provisional findings of its investigation into the power suppliers.
The origins of this review date back to Ed Miliband’s pledge to cap consumer bills in 2013, as the coalition government tried to seize back the moral high ground from the then Labour leader.
Since then, the market has evolved at pace. Smart metering and new technology allowing people to manage their consumption better could transform the relationship between the big energy companies and their customers.
Innovation and the mass arrival of the smartphone may do more to restore trust in the industry than the constant stream of reviews since 2007.
Of course, where there are abuses in any industry, then there should be investigations. But these need to be timely, proportionate and effective and too often they are not.
Reports, reviews and commissions are a lucrative line of work for peers, knights and dames and can provide cover for politicians. Whether they bring great benefit to consumers is open to doubt.
Quadropobia
THE new holy grail in the telecoms and media industry is ‘quad play’. Executives have convinced themselves customers want a bundle of fixed line telecoms, mobile, broadband and television. This is driving mergers, with Vodafone expected to be the next to unveil a big deal. But the received wisdom seems shaky to me.
There is not much cultural compatibility: people used to running a telecoms infrastructure business might not be much good at managing a creative ‘content’ company and vice versa.
And the quad play idea seems to be driven more by what companies want to sell than what consumers want to buy – never a great idea, because the only way to induce customers is to offer freebies. For an example of how it can go wrong, look at the banks. Their efforts to package accounts and services have produced a terrible tangle of cross-subsidies.
Summer for savers
GEORGE Osborne has done some great things for savers including the pensions freedoms – which despite the ructions are a huge improvement on the discredited annuity regime.
But low interest rates and stagnant household incomes are a discouragement. The concept of building a nest egg for large goals such as a deposit on a home has lost traction because the sums involved are just so enormous.
For smaller projects, easy credit often appeals more than the thought of putting cash aside.
Anything the Chancellor can do in next month’s Budget to restore a savings culture, particularly among the young and the less well off, will be very welcome.