London Chamber of Commerce and Industry Transport Dinner
This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government
Explains how modernising Britain’s transport infrastructure will improve the UK economy and make London globally competitive.
Thank you for that introduction Willie (Willie Walsh, LCCI President) - it’s an absolute pleasure to be with you this evening
I am deeply honoured that the Prime Minister has entrusted me with the job of Transport Secretary.
I’m also hugely excited about my new role. And that’s because I know just how much high-performing transport systems matter.
They matter to our economy, our society and our environment.
They matter to our collective well-being and our individual quality of life.
And they matter because they make a difference not just today, but for generations to come.
So I am looking forward to the task ahead immensely.
This is actually my first speech as Transport Secretary.
And, at a time when the economy and the future of business is front and centre of all of our thinking, it is perhaps appropriate that I should be speaking to the LCCI - the respected voice of London business. I have met many of you before.
Now, while no minister ever wants to disappoint an audience, you’ll forgive me if I don’t use tonight as an opportunity to set out my entire transport manifesto chapter and verse.
What I will say though is this: as Transport Secretary I will have a laser focus on ensuring that transport remains right where it should be - at the top of this government’s agenda.
As wealth creators and business leaders you, the members of the LCCI, will know better than most the 2 big challenges facing Britain.
A global economy under severe strain
And of course, here at home, the coalition inherited a deficit as bad as any in this nation’s peacetime history.
So - challenges both home-grown and international.
Challenges for London too:
- as a capital city whose population is projected to grow by nearly a million people in the next 20 years
- as a city where 24 million journeys take place every working day on our transport system
- so often a gateway into our economy but also out to the global market-place
- and as the 2012 host to the greatest show on earth - the Olympic Games
Beyond any question we are living in testing times.
So how do we confront those challenges and meet those tests?
How do we sharpen Britain’s competitive edge - improve our productivity, become the best place in the world to do business?
How do we harness London’s power to drive the UK economy - to generate growth and create jobs?
Tonight I want to argue that modernising Britain’s transport infrastructure is the key to answering these crucially important questions.
Strong foundations, economic stability
Investing in our transport infrastructure means a better connected society and, if we invest it wisely, a cleaner and greener environment.
It is also good economics.
Cutting commuting times and speeding up journey times.
Moving people and products in a more reliable way.
That’s how I want to see my role, one of backing British business.
But you can only build a modern transport system on strong foundations - and that means ensuring economic stability.
When the coalition was formed nearly 18 months ago, we knew we faced perhaps the toughest agenda of any government in modern British history.
But from day one, we have been absolutely clear about our priorities - tackling, first and foremost, the record budget deficit inherited from our predecessors, and rebuilding our economy after a long and deep recession.
Our resolve has been vindicated by Standard and Poor’s recent confirmation of Britain’s “Triple A” credit rating.
We are also focused on jobs and growth.
That’s why we’ve launched the growth review and announced a “credit easing” scheme to help small businesses.
It’s why, in the wake of the Thameslink rolling stock award, we’re taking a long, hard look at public procurement policy - I believe in the free market, but I also believe in a level playing field for British firms.
It’s also why we are reforming our employment laws, modernising our planning regulations, and easing the burden of regulation - policies to give businesses the room to grow and the conditions to invest.
A clear break, a different choice
Nevertheless amongst the tough choices, there are some extremely positive ones. We have made a clear break from past governments by supporting capital investment at a time of fiscal retrenchment.
Under previous administrations, capital investment was always first to suffer when cuts needed to be made.
Short-termism became the British disease.
Well, no longer.
By putting in place strong foundations for long-term economic stability we are making a different choice - to invest in our transport infrastructure.
Last year’s ‘Spending review’ was a statement of our intent - a bold commitment to invest over £30 billion in road, rail and local transport projects across the country.
And, to further support infrastructure investment and other development projects, we have also just announced £500 million Growing Places Fund.
The fruits of our focused investment are becoming clear to see, not least in London.
Because if we want London to be globally competitive, it’s absolutely vital that London has a world class transport infrastructure.
To support a labour productivity rate here in the capital that’s more than 31% above the national average.
To maintain the city’s position as the financial capital of the world.
And to fuel an economy that accounts for around 19% of UK GDP.
London is Britain’s economic engine.
And, by investing in the transport infrastructure that serves and supports the capital, we can keep that engine powered up - for the benefit of the whole country.
Investments modernisations boosting London
So we’re cutting congestion on key strategic roads, like the M25, through innovations such as hard shoulder running and managed motorway technology.
My predecessor rightly won plaudits for shutting down the much derided M4 Bus Lane.
And he also announced a review of the decades old 70 mph motorway speed limit to speed up journey times and support economic growth.
In the run up to the 2012 Olympics, £6.5 billion has been invested to modernise transport systems in and around London.
The first ever domestic high speed train in Britain taking passengers from St Pancras to the Olympic Park.
More tube trains and, more seats for passengers.
Line extensions and new stations.
An incredible transport legacy for London.
Beyond the Olympics our Thameslink programme will double capacity on one of Europe’s busiest stretches of railway and make travelling across London and the south east faster, easier and more reliable.
We are pushing ahead with a multi-billion pound upgrade of the Tube as well as the transformational Crossrail project.
Together they will add 30% capacity to the region’s rail network and provide an estimated £78 billion boost to the UK economy.
London will also benefit from investment in national transport infrastructure.
Not least from our proposals for a truly national high speed rail network - HS2.
HS2 has the potential to transform the entire country’s social and economic geography.
But think also of the potential positives for London.
Better connectivity and faster journeys.
Our major cities and regions brought closer to the capital.
New opportunities, new markets and new customers.
So we have consulted widely on our HS2 proposals, we are considering the many thousands of responses carefully and we will publish our response towards the end of the year.
London’s key transport infrastructure doesn’t begin and end with its road and rail links, however.
For centuries, shipping has been instrumental in bringing prosperity to London and the south east.
And today is no different.
By the end of 2013 there will be a new deep sea container port and business park at London Gateway, with DP World’s very welcome recent announcement of a £1.5 billion investment in the port.
Driven by private finance, this project will mean the world’s biggest container ships can call at the heart of Britain’s capital.
It will also help create 32,000 jobs and add £3.2 billion to the national economy each year.
Another vote of confidence in the future of London, and in UK Plc.
Heathrow aviation - transport is not a zero sum game
But it’s another vital international gateway that is grabbing all the headlines during my first week as Transport Secretary.
And I accept that the government’s decision on Heathrow’s third runway has had its share of critics - not least in this room tonight.
But while it’s no secret that, in the past, Willie and I have been on different sides of the aviation fence on this one, we both inhabit the same world of political reality.
And the political reality is that the runway decision has been made, it’s done.
But let me also say this. The decision we took on the third runway does not make this government anti-aviation.
And it certainly doesn’t make me anti-aviation. Far from it.
I know just how many of my constituents rely on an efficient, effective and successful Heathrow - for work and for travel.
So, as far as I am concerned transport is not a zero-sum game.
Economically, socially, environmentally every mode has an impact, every form of travel is a crucial part of the total mix.
And that includes aviation.
I passionately believe that the success of our airports and airlines is critical to the success of London and Britain.
The transport choices I make and the decisions I take will only ever be informed by the long term interest of this city, and this country.
So Willie, what I want to do is work with key players like you, and with the wider aviation industry, to change the nature of the aviation debate - to move forward constructively.
Indeed, I want to build on the work my department has already carried out engaging with the LCCI, listening to your views on the future of aviation.
I honestly believe we can leave behind the polarised opinions that have dominated the discussion in the past. That we can find common sense, common ground - an inclusive consensus for change.
If we do that then I am certain we can improve and reform airport regulation and we can develop a new aviation strategy for the long term - one that supports economic growth while addressing the environmental impacts of airports and flying.
That’s precisely why, through our scoping document, we have asked questions and engaged widely on a range of aviation issues - such as the economic benefits of aviation and the role of a UK hub airport.
I am absolutely confident that, if we change the nature of the aviation debate, then we will be able to generate a little less heat and shed a lot more light on the big challenges facing the industry.
Tonight I have argued that we are facing challenges which are in many ways unprecedented.
I have also argued that, to meet these challenges, requires a stable economy and focused investment in our transport infrastructure.
This government is working hard to deliver both.
That’s a policy approach which makes sense for London - helping to cement its position as a competitive, productive, wealth-creating global player.
But it also makes sense for the rest of the country.
Because, when you have an economic engine as powerful as London’s then, for the sake of the entire national economy, you need to make sure it can fire on all cylinders.
And that’s exactly what our policies are doing.
So yes - these are testing times.
But, you have a government determined to rebalance our economy and modernise our transport networks.
We are blessed with a capital that enjoys advantages which are the envy of cities around the world - from the global reputation of its financial sector, to the rich diversity of its cultural life.
And I believe we can boast a business community with the dynamism and determination to out-compete and out-produce any company and any nation any where.
That’s why I know we can meet this moment and show the world why London is a great city and Britain is a great country with a great future.
Okay: in my first speech as Transport Secretary the last thing I want to do is keep an audience from their dinner - that’s no way to build a future working relationship with Britain’s businesses.
So I thank-you for listening and I look forward to working closely with you all in the months and years ahead.