An anti-Corbyn Labour member put it to me the other day that the Government must have a grid, full of carefully placed missteps and own goals, designed to keep the Leader of the Opposition in office until 2020. That or there was no grid at all.
How else to explain the fact that the looming closure of the Tata steelworks in Port Talbot seems to have come as a complete surprise to the Government?
The strategic challenges facing British steelmaking, a combination of high domestic energy costs and cut-throat international competition, haven’t been kept secret. Even before the Chinese began dumping steel, Tata has been cutting UK jobs and publicly blaming electricity prices.
Even if the Department for Business, Innovation, and Skills somehow slept through all that, surely the closure of the Redcar steelworks last autumn should have put this industry’s woes on the radar?
If the Government is going to end up propping up the plant, which seems to be the consensus view, then why did BIS not work quietly with Tata to make Port Talbot more economically viable, for example with some kind of rebate on energy costs?
Alternatively, the Government could have had a proper plan in place for the closure of the steelworks, with a credible blueprint for helping the surrounding community transition successfully into the modern economy.
The arguments for keeping the British steel industry going at all costs are scarcely compelling. It’s very hard to imagine a scenario where the UK can’t import steel but can import the raw materials needed for steelmaking, such as iron ore, which we don’t produce either.
As others have pointed out, if anybody seriously believes we need to be able to withstand a total drought of steel imports it would be far more cost-effective just to import Chinese steel whilst it’s still cheap and store it.
Sajid Javid, who has been arguing against nationalisation, clearly recognises that simply deferring an inevitable reckoning between heavy industry and the high-cost, high-wage economy of modern Britain is a poor use of public funds which could be better spent building a sustainable future for the area affected.
But because he doesn’t appear to have had forewarning that this was coming, confusion reins. Different ministers give different answers as to what is or is not on the table, and the Secretary of State was out of position – in Australia – as the story developed.
Panic or inertia may lead to a response rooted in expedience rather than strategy, and against the instincts of the Business Secretary. How did the Government end up with its eye so far from the ball?
Part of the answer is surely Europe: as Paul Goodman explained earlier this week, Downing Street is fixated on the referendum. This is scarcely something eurosceptics can complain about, but it seems apparent that this clogging of the Prime Minister’s limited bandwidth is hindering the Government’s effectiveness in other areas.
It may also be a symptom of the decline of proper Cabinet government that the Secretary of State was less willing or able to take the initiative and engage in contingency planning within BIS. Perhaps in modern Departments the capacity or instinct to do that without central direction has eroded.
One doesn’t need to be a member of the “Bring back industrial policy!” brigade to recognise that this ‘steel crisis’ illustrates a serious lack of strategic awareness on the part of the Government.
Even those of us who believe in letting unsustainable industries go recognise the Government’s role in helping communities to transition and find a new role in the economy. That means you need to know when these events are coming in order to pre-empt them and soften their impact.
The Government shouldn’t plan the economy, but it does need to plan around the economy. Its failure to do so must be addressed.