The whole brouhaha has reinforced my scepticism about these kinds of announcements regardless of who is making them. They are almost always a triumph of presentation over substance that involves wrapping up projects that have already been announced with those that were going to happen anyway, tying it all together with a bow and pretending it’s shiny and new.
Sure enough, dig a little deeper into the figure of £50bn in investment pledges due to be made on Monday and you will find that it includes £24bn of green investment unveiled last week.
What’s more, a good chunk of the money unveiled last week included projects that had already been announced. It’s hard to know whether some of this stuff is being double, triple or even quadruple counted.
The impressive-sounding number apparently also includes a £20bn investment from Australia’s Macquarie group, which will go towards building an electric car-charging network and offshore wind projects.
That certainly rings a bell. Back in March 2022, then prime minister Boris Johnson proudly announced that leading Australian businesses were pledging new investments totalling £28.5bn in projects across the UK.
Johnson claimed this demonstrated that Australia’s leading businesses recognised the opportunities “in our dynamic and forward-looking economy”. In a nod to Brexit, he claimed this was “global Britain in action”, suggesting that such investment wouldn’t have been possible when the UK was still part of the European Union.
The “fantastic schemes” announced that day would, Johnson claimed, “turbocharge the Government’s efforts to create jobs and growth in every part of the country and put the UK at the cutting edge of the green industrial revolution”. The main commitment was Macquarie’s pledge to invest £12bn by 2030, including in offshore wind in Lincolnshire and north Scotland.
Sound familiar?
This is, of course, the same Macquarie that got dubbed the “Vampire Kangaroo” for its reputation of taking over UK infrastructure assets, loading themselves with debt and gorging itself on the dividends.
The announcement pointed out that the Aussie firm had invested £50bn in the last 15 years. But my issue with the announcement was less ideological than it was mathematical.
Anyone capable of dividing 50 by 15 and 12 by eight (which might even include a few business journalists) could have spotted the problem. Johnson appeared to be announcing that Macquarie was planning to halve the rate at which it was investing in the UK from £3.3bn a year to just £1.5bn (even before you take inflation into account).
Taken at face value, that sounded like bad news not good; evidence of an international investor’s scepticism in the growth prospects of the UK rather than a ringing endorsement of the country’s potential. But the broader point is, of course, you shouldn’t take such announcements at face value.
They’re nonsense. The reality was that Macquarie might have invested more than it originally announced and might have invested less. No one would check. Macquarie invests in stuff if there’s stuff that’s worth investing in.
What businesses really need from this Government is a period of stability and an end to the endless speculation about the conditions under which they will operate in the future. That’s why this summit has struggled even to deliver on the presentation side of things.
The start time and the venue were only confirmed five days ago. Executives have expressed frustration over the lack of detail about the agenda. Those seeking clarity apparently received out-of-office replies from organisers just last week. An email sent to delegates in recent days also inadvertently contained the email addresses of over 100 invitees.
This has all added to a strong suspicion that the event was rushed in order to fulfil a pre-election pledge to hold it within 100 days of Labour taking power. The Government didn’t even have an investment minister until last Thursday – when Darktrace co-founder Poppy Gustafsson was finally appointed.