to think that spending £30 billion on the UK's infrastructure is a stupid idea?

[belledechocchipcookie]

10 billion from the government, 20 billion from private companies. Isn't it a better plan to invest in people so that it will filter down?

1000 more nurses and teachers (or whatever) would pump more money into the economy as they will need somewhere to live (bonus to house building) and have money to spend in the shops (bonus to shops and manufacturing).

Improve the roads means people will get from A to B quicker. It's pointless going from A to B if you don't have a job and you can't afford the petrol. It seems very ill thought out and stupid to me. Could someone explain it to me please

The thing is, the government can't just 'create' jobs (well, this has been tried....but not particularly effectively, and at a time when we had a lot more money to slosh around.) What the government can do is create the environment where businesses want to invest in the UK and create jobs. One of the ways to do this that will be of benefit in years to come - not just short-term for the construction industry - is by investing in well-chosen infrastructure schemes.

So you think a load of nurses and teachers should be employed for a couple of years with the 10billion and then fired? I don't really see how that would help anything.

Spending on infrastructure is time limited, there's no ongoing cost, indeed it most likely reduces ongoing costs (ie build a new road that road won't need much maintenance for quite awhile, and you won't need to endlessly patch up the old roads) so you're not committing to spending the money in the future.

And builders and building material suppliers etc. all also spend on houses etc. so the money trickles down just the same.

I find it quite alarming the standard of financial understanding shown on this thread 2billion a year forever is very different to 10 billion once.

YABU

It has been shown, time and time again, that investing in infrastructure during a downturn is a good idea.

1. Create more jobs - not just construction jobs, but a lot of industry around it (e.g. cafes to provide food, admin staff etc.)
2. Despite all the "oh it's only going on the south" calls, there is actually a lot of investment going on outside of the south - Tyne and Wear Metro (helps people get to and from work), Manchester airport link, Transpennine rail route. There's been a massive gap for decades between the amount of economic activity in the south east and the rest of the UK; this may help bridge that gap, by encouraging people to stay local (for the jobs being provided).

Not all the money is coming from the government - they're looking to encourage foreign investment to make up most of it.

The UK's infrastructure is aging rapidly and is in a bad state; let it fall further behind and the UK loses out even more.

I'm not sure yet if I agree with this or not.

But it has been shown that certain kinds of Govt spending does help turn around recession. Plus, building these projects will create jobs in the building - as AbsofCroissants puts very well.

Bottom line is that the recovery needs jobs and confidence. This scheme won't bring enough of either to a broad cross section of the population.

This scheme will bring massive benefits to the country. In terms of jobs, investment and improving confidence. What you can argue is that the results won't be realised in the short term.

It'll take a while to get companies interested, people hired, all the planning permissions approved. Then the actual building and only at the end will the general population benefit.

But then it's been the whole short termism which has caused us massive problems. We need to stop looking at quick fix plaster solutions and focus more on plans which will benefit the nation in the long run. And this scheme ticks that box for me.

Do the unemployed have access to a car and can they afford petrol?? In the short term, people are losing jobs and are struggling to feed their families. This scheme isn't going to help people to do this, it's just going to enable them to drive from A to B a little quicker.

It sounds like a good way to spend money to me. Better infrastructure will improve quality of life for residents and businesses and could create jobs, increase house prices and keep jobs in that region.

I don't understand the argument that it's not an investment in people. People will work on the project and businesses have to supply materials and labour which is positive all round.

erm..Belle. The idea is that the workers which will be needed to build the infrastructure (including all the admin/HR/IT/management staff) will mean that more people are employed than otherwise may have been. Not including the knock on effect of having people employed.

In other words, less people will be struggling and can feed their own families. Then at the end, yes people can travel from A->B quicker. Therefore be more productive, more business will happen as a result. Everyone's a winner.

No as I said it wont happen in the short term but as a medium/long term thing I think it's great.

YABU... To give you an extreme reason why, suppose no-one had ever built a canal, railway or motorway in this country. Whole towns like Milton Keynes would not exist because they would not be accessible. When a road or railway cuts through a location, suddenly it makes sense to build homes and start businesses along that route. When the USA was in the grip of the Depression of the 1930's Roosevelt's 'New Deal' included a mass programme of building dams, railways and bridges.. employing thousands and opening up new areas for development.

This isn't new money being found, it's being reallocated from elsewhere. Question of making the budget we have work as hard as possible for us.

I am not pro the government, but I am pro infrastructure spending, despite today's strikes (which I support and am only not striking because I have a newborn and a still-sore recent CS scar).

Of course spending money on infrastructure has an impact on jobs.
I am a public sector civil engineer, infrastructure schemes have paid my salary for the last 10 years. This work won't just employ civil engineers, but planners, ecologists, project managers, geologists and others as well as the site personnel needed.

There is always a "wishlist" of public infrasctructure schemes needing funding. These are all highly considered, the need proven and the economic, social and environmental impact assessed before they even see a single penny spent on them. They have not just been invented for the sake of sound bites, many of those schemes will have been waiting in the wings for ten years or more.

Infrastructure is more than just roads and rail though. There is all sorts of other stuff you don't think about but would notice if it wasn't there; flood defences, sewers, cable networks (OK, these are mostly privately owned now)...

But Belle - how would you suggest that the country/government helps people who are losing their jobs? Give them a cheque? Pay for them to all employed by 'the government' ? How is that sustainable? (and I speak as a public sector worker who was re-organised out of existence job-wise last year...)

The government needs to do everything it can afford to do to encourage businesses to take on new staff and for businesses to locate in the UK. This will create new jobs for unemployed people. It has consistently been shown that one of the key factors businesses use when deciding where to locate is the infrastructure. So no, unemployed people may not be driving everywhere, but their potential employers will be. Not sure what your point is tbh .

We need to put more money into public services. The money will filter down into manufacturing, shops, house building etc as the new staff will have money to spend.

Sorry I disagree. We can't afford to - and if we are seen to be spending more money in this way then it is likely that our (realtively good) credit rating will be downgraded and the cost of our borrowing will rise massively....thereby leading to more draconian measures to service the debt. The hole Italy is in at the moment is partially caused by their inability to cut back on public sector spending and services and hence the cost of their credit soaring.

Now the government should start building nuclear generators, and stop fiddling around with windfarms, the follies of the early twenty-first century.

We can't afford to invest in road improvements either though.

niceguy2 - In the short term I need a job that pays enough after my petrol cost to make it viable. I'm a skilled worker with a wide range of experience and the jobs just aren't there. Temping in a warehouse for £6 an hour just isn't viable. At this moment the medium and long term aren't something I am bothered about at all.

Cut VAT, freeze fuel duty, and tax the crap out of financial services and bankers bonuses.

The problem is that public sector workers, by definition, are paid for out of taxes. Even though they are tax-payers and even though their wages go to pay for goods and services, they are not bringing any money directly into the economy with what they do. A nurse does an essential job but he/she isn't making something that can be sold for a profit or exported to another country to be sold for a profit. And without a profit, there's no corporation tax paid in to pay his/her wages... vicious circle and precisely where we are at the moment.

How would the country look if we neglected our profit-making industries and just kept shelling out millions keeping public services in tip-top shape and paying out wages?.... I tell you. Like Greece.

I understand Curly and that's the biggest downside with this idea. But the simple fact is that there is very little we can do in the short term which is sustainable and affordable.

Government's cannot magic sustainable jobs out of thin air, as much as we'd like it. Even now if they decided to slash corporation tax to 0% today to attract multinationals to invest, it would still be at least a year before you saw any benefits.

Like I said, we need to invest in the right things for the long term success of the country. Not throw money at something which is not sustainable and gets a few good headlines for a week or two.

Without reiterating too much what has been said previously, I think the infrastructure improvements are necessary to assist the country in economic growth. It is one of the only schemes which benefits every facit of society - including unemployed folk - as everyone idea transport to get from A to B at some point.

Business will benefit hugely from cheaper logistics costs, especially SME's who struggle with economies of scale on current unit shipping prices and the projects themselves will create jobs for all manner of people. It will also serve us excellently in future decades with having an infrastructure system which makes us comparable with other countries.

Oh, and them duty has been frozen so this should have a profound impact on my families petrol bill and reduce my shopping bill.

Spending money on the public sector gets beyond sustainable when significant swathes of people work in a 'spend culture'. I was a public sector worker up until 3 months when I was made redundant and the exorbatant waste of money on meetings in London which were NEVER done via telecon (when they should have been) are part of the problem why ee serving this mess. Inefficiency needs to be cut and the private sector needs to expand to be able to pay for public services we need.

Cutting VAT would be the stupidest thing ever. If the £12bn that the previous VAT cut cost had been spent this way instead, then we would already be feeling the benefit of those jobs and some of this infrastructure would be nearly ready.

Increasing the public sector wage bill is not 'investment', it is a cost. We need more private sector jobs to increase tax receipts, which can then support the public sector.
Labour tried to get us out of the economic shit by putting more money in people's pockets to spend, and what a surprise it hasn't worked. You cannot prop an economy up with shopping.

Wrong. Every economic commentator over the last few weeks are quick to point out that over 70% of our GDP comes from consumer spending. 70%!

The only way to recovery is getting people spending again.

Well that is the point isn't it? If it didn't then we might not be in such a position as we are...

Curleyboy I don't think people have stopped spending. Where does the other 30pc of GDP that these economists come from, just out if interest?

And expenditure naturally flows from produce which have to be transported. Increasing infrastructure will naturally lead to better economies of scales for all of us - transportation costs decrease as less is spent on fuel (better provisions for current road users and less traffic jams).

The Labour govt made it much too easy to borrow and take out credit and had no provisions in place for when people racked up massive cc bills and couldn't pay them. I think we ALL have to take responsibility for the problems we have collectively caused and get our country out of this friggin mess.

Well technically you are right Curly but that's a bit like telling a man stuck in a desert that all he needs is a drink of water. The problem is where he gets the water from.

Same here. How do you get people to spend money they simply don't have?