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by Aris Roussinos
Friday, 29
January 2021
Aris Roussinos
Idea
14:51

Why the Government should lobotomise its ‘Treasury Brain’

by Aris Roussinos
So close and yet so far. Credit: Getty

We should give credit where it’s due: throughout its Covid debacle, the Government’s done one thing very well indeed. Its concerted, well-managed and innovative programme of vaccine research has vastly outpaced our erstwhile European partners, holding out the prospect that, if we get this right, we can be one of the first Western economies to forge a path out of the crisis.

But there’s a flaw, and it’s a major one: as the EU’s threats to confiscate our vaccine consignments from Astra-Zeneca’s continental warehouses show, by being dependent on the open market for vital supplies, the nation’s security is placed at risk. Outbidding competitors and signing contracts early may work in a normal situation, but in a period of major crisis even the largest transnational corporation can be brought to heel by a government exercising its sovereign power.

Looked at this way, the UK is worse off than most countries. No other advanced economy has sold off so much of its vital national infrastructure, and no other political system has dared to leave its people so at the mercy of events beyond its control. By doing so, successive British governments have, over the past 40-year car boot sale of our industrial patrimony, placed the entire nation’s survival at risk. And it could be even worse. As Nick Timothy noted on Twitter, in 2015 the then-chancellor George Osborne refused to get involved when Pfizer tried to buy Astra-Zeneca, waving away concerns about Britain’s vital strategic needs.

That has to change, now. As we enter a period of international turbulence greater than anything experienced in any of our lifetimes, the age of the unfettered free market is over. Britain needs an industrial policy geared towards the nation’s survival, where the nation retains control of essential strategic industries and assets. Moreover, the state must retain the capability to direct and boost production in a time of crisis.

One underreported project, the UK Vaccines Manufacturing and Innovation Centre (or VMIC) is an excellent start. It promises to provide Britain with a genuinely innovative and strategic capacity to research and produce vaccines for the waves of pandemics heading our way thanks to an age of global travel. But it’s not enough. As Declamare (a must-follow Twitter analyst) observes, the £141m granted to VMIC by the Treasury to speed up its launch is a pitiful amount compared to the vast sums spent on dealing with the virus’s baneful effects. It is an absurd case of penny-pinching in the middle of our greatest crisis since the war.

Declamare notes, the Treasury funding to VMIC is:

“The same amount as it cost to run the furlough scheme for just over 2 hours last month … even the total amount spent on vaccine purchasing and manufacture (£6 billion) is only the equivalent of 4 days of furlough!”
- Declamare, Twitter

The government needs to shake itself free of its self-defeating “Treasury Brain” worldview and start funding vital Biotech infrastructure like VMIC properly, getting it up and running sooner and getting the nation out of this crisis faster. VMIC should be the start of the urgent re-shoring of vital strategic infrastructure under state control: too many of our fellow Britons are already dead because our state sold off all its capacity to keep us safe, and that number’s rising every day. We must never let a government put us in this position again.

Join the discussion

  • COVID-19 has shown that “national security” in the widest sense of that term needs to be re-examined and an appropriate policy drawn up. However selling off the national infrastructure is not the issue. Railway lines and power stations cannot be packed up and carted offshore by hostile corporations or foreign governments. Short of military submission a nation state is sovereign in its own territory and can do whatever is necessary to ensure its security. Infrastructure assets can be seized and in times of national emergency the British workforce of that infrastructure is unlikely to down tools in support of the hostile foreign entity.

    No, the national security concerns are to do with supply. A detailed study will need to be done but the kind of “assets” that need to be secured can be glimpsed by asking the question “what might bring the country to its knees if we had to go without for say 3 months?” Not cars, not avocados, not even toilet paper (though I would make the case for the soft variety!). It is basic food stuffs; wheat, potatoes, fruit, vegetables, salad and meat. It is energy; oil and gas. It is medical supplies; equipment, consumables, drugs and vaccine. Casting the net wider, it is the supply of raw materials and components for the continuation of activities that form a substantial part of the economy (historically vital but less so now because of our largely service based economy).

    These are the assets that need to be secured and to do so is not as difficult as it has been regarded historically. Scientific and technological advances should make it possible for even these crowded islands to produce enough basic foodstuffs to feed the population. The “greening” of our economy almost incidentally brings with it energy security . The case for self sufficiency in medical supplies has more than been made and will be demanded by voters. The supply of raw materials and components is more problematic but appropriate policies in this area would help create a much needed true long term international strategy.

  • On the eve of WWI, Winston Churchill bought a controlling stake in the struggling Anglo-Persian Oil (later renamed to British Petroleum) on behalf of the UK government, because he wanted to guarantee supplies, to secure national stretegic interests rather than make a profit. The very same British Petroleum that Margret Thatcher re-privatised in the 1980s. EU level playing field rules would prevent any EU nation from doing what Churchill did. Which I guess is the convoluted point – if no EU nation can get a jump on the others, they are less likely to attempt to roll the tanks in on their neighbours.

    Which of course, leaves China and the US rubbing their hands with glee in anticipation.

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