It's time to rebalance our economy

What are the real issues that are affecting our country and prosperity?

We are going through a very difficult time with Brexit, but is Europe really the problem? Have we missed the real issues which are disillusioning the people and indeed people in many other world countries?

The reasons we are failing are because we have given too much power to the financial system, have exported jobs to low wage nations, have a small manufacturing economy, not training our young people in the range of skills necessary to be successful and allowing the burden of tax to hit the average person unfairly.

The banks and financial wheeler dealers have been given power to move investments anywhere in the world without being questioned about their motives. This allows them to avoid their responsibilities for communities, while making themselves rich at the expensive of the average person. This practice has led to underinvestment in UK jobs, lack of opportunities for our children and limited hope which leads to despair, particularly in the north and the Midlands. It is interesting to reflect that the two countries which led the deregulation of financial services, the UK and USA, now have the smallest manufacturing economies of the G7 nations.

Clearly we got it wrong: the UK set out to weaken manufacturing to defeat the industrial unions. The unions have been weakened, but investors have not built up industry again – letting the people down for their own wealth reasons. Ironically the Japanese, so far, have been successful with automotive manufacturing in the UK by having a modern approach with unions and long-term investments plans. Was UK management the real problem or the unions?

Going forward we must address these serious issues to get the UK up and going again.

Firstly we need to tackle the freedom of movement of capital. More of our capital needs to be invested in the UK with a range of jobs to suit the skills of the people, pension funds must invest at home not abroad – how can we ensure the future wealth of the nation by investing more and more abroad? Instead of fighting about tariffs we should be concentrating on trade balancing – producing more of what we consume in the UK, such as goods, food and energy.

To achieve the better future we need to improve skills, particularly apprenticeships, technical skills. There should be no youth unemployment – all youth should have to work, with continuous training managed by local authorities. As part of this improving of the skills of the nation, we critically need to train more doctors and nurses, and provide the incentives to do this. We should aim to train more than we actually need at any given time so that we have a surplus for when we need it. Once they complete their training, they should be guaranteed a jobs, with any spare capacity used to retrain others.

On energy the UK needs to concentrate on solar power both in consumption and the manufacturing of the installations for solar power as imported energy will become more expensive due to the weakening pound. We need to set targets – why not set a target of 75 per cent solar power by 2040? This would be UK energy not imported energy.

Food production is another example of us slipping. Forty years ago we produced about 85 per cent of the food we consumed, now we are down to only producing 55 per cent. This is far too low, and makes us vulnerable to future instability in the markets, costly and taking away UK jobs.

Similarly our manufacturing base is far too small. In the 70s our manufacturing economy was more than 30 per cent, today it is only a pitiful 10 per cent – one of the lowest in the major nations.

How do we make these changes and drive the way forward?

Working with other nations to change the consensus. Taking back control from the financial sector, more planning and devolution of power to communities.

Taxation has created many of these problems. Since the 70s the rate of tax on the top has been reduced, corporation tax has been greatly reduced, pensions have been weakened and now business wants business taxes reduced. There is no thought for the funding of the communities where the workers live and are educated. For example corporation tax was 52 per cent in 1979, but in 2017 it was only 19 per cent.

Tax for the average person since the 70s has seen VAT increase, tax on vehicles increased to more than five times what we spend on the roads. We have taxes on energy and insurance policies, all aimed at the average person while allowing the top one per cent to own more and more of the country. The unfairness can be quantified – the bottom fifth of families pay 28 per cent of their income in VAT, duties and levies will the top fifth only pay 13 per cent. No fairness there: only reducing the opportunities for families to improve their lot.

We must get the UK growing again, shift the level of taxation in favour of the average person and give hope for a better future to our children and grandchildren.