Boris Johnson brushes off UK's woes, vows high-skill economy

Topics Boris Johnson | Britain | UK economy

Johnson told the Conservative Party's annual conference that he'd end decades of drift and dither and tackle long-term structural weaknesses," especially a reliance on low-cost labour from abroad.

This is an autumn of inconvenience in Britain, marked by empty gas pumps, worker shortages and gaps on store shelves.

None of that got a mention from Prime Minister Boris Johnson on Wednesday, as he brushed off the economic bumps and said the U.K. would emerge from Brexit and the coronavirus pandemic as a more productive and dynamic nation.

Johnson told the Conservative Party's annual conference that he'd end decades of drift and dither and tackle long-term structural weaknesses," especially a reliance on low-cost labour from abroad.

Relaxed and ebullient in front of a friendly crowd, Johnson did not note that much of that drift and dither came under Conservative governments. The party has been in power for two-thirds of the past four decades.

Johnson extoled the Brexit freedoms brought by Britain's exit from the European Union, even as shortages of truck drivers and other workers cause economic hiccups. Brexit ended the right of EU citizens to work visa-free in Britain and has left growing gaps in the economy.

We're embarking now on a change of direction that has been long overdue in the U.K. economy," Johnson said, vowing "not to use immigration as an excuse for the failure to invest.

Delegates at the conference in Manchester, northwest England, gave a standing ovation to a speech that was long on optimism but short on concrete policies, and seemed well insulated from the world outside.

Britain has been through a turbulent time since the Conservatives last met in person two years ago. Then, Johnson vowed to get Brexit done after years of wrangling over Britain's exit terms from the EU.

That promise won Johnson a huge parliamentary majority in December 2019. He led Britain out of the EU last year, ending the U.K.'s seamless economic integration with a trading bloc of almost half a billion people. Britain also has been hammered by the coronavirus pandemic, registering more than 136,000 deaths, Europe's highest toll after Russia.

The pandemic, which put much of the economy on ice, and Brexit have combined to throw Britain's economy out of sync.

While not as dire as Britain's infamous Winter of Discontent in 1978-79, when thousands of striking workers crippled essential services, a crisis that ultimately led to the election of Conservative Prime Minister Margaret Thatcher, the country is experiencing the most widespread economic disruption in years.

A truck driver shortage, due partly to a testing backlog and partly to an exodus of European workers, has snarled British supply chains. That has left supermarkets with some empty shelves, fast-food chains without chicken and gas pumps dry.

This week the government called in the army, getting scores of soldiers to drive tanker trucks. It also says it will issue up to 5,500 short-term emergency visas for foreign truckers.

Other struggling parts of the economy say they aren't getting the same quick action. Pig farmers protested outside the Conservative conference, saying a shortage of abattoir butchers means thousands of hogs may have to be slaughtered on farms, ending up in landfills.

It's a complete and utter waste, said farmer Meryl Ward, who urged the government to recruit European butchers to ease the crisis.

Johnson says businesses will have to tough it out by improving pay and conditions to get British workers to fill the empty jobs.

He said the move to a high-wage, high-skilled, high-productivity economy will take time, and sometimes it will be difficult, but that is the change that people voted for in 2016 when they opted for Brexit.

Some economists say Johnson's argument that immigration pushes down wages is misleading, and that his economic plan is incomplete.

The prime minister is right to say that the U.K's economic model is broken, but his lack of policies to remedy this speaks volumes, said George Dibb of the Institute for Public Policy Research, a center-left think tank. Labor market shortages alone won't lift wages and working conditions across the U.K. economy.

Many Conservatives too are worried the winter could bring a hit on voters' pocketbooks due to a new health care tax, rising prices, soaring energy costs from a global surge in natural gas prices and a cut to welfare benefits.

Starting Wednesday, the government is withdrawing a 20 pound ($27) a week welfare boost that helped more than 4 million families make ends meet during the pandemic.

Danny Sriskandarajah, chief executive of Oxfam GB, said many people who rely on the benefit are low-paid workers.

It cannot be right to take away a lifeline that analysis shows will push half a million more people into poverty, including 200,000 children, he said.

The squeeze on living standards could make it harder for Johnson to meet his key goal of leveling up the U.K. by spreading economic opportunity beyond the south of England, where most business and investment is centered. That promise helped him win working-class votes in areas that long were strongholds of the center-left Labour Party.

It is also pushing the Conservative Party out of its comfort zone as the champion of small government and low public spending. Johnson's ambitious and expensive list of promises ranges from new railways and roads to slashing carbon emissions and reintroducing beavers to Britain's landscape.

Voters will eventually judge whether the Conservatives have delivered on their promises. But for now, with most opinion polls giving the party a lead over a demoralized Labour, delegates in Manchester were as buoyant as their famously irrepressible leader.

They packed meeting halls and sipped warm white wine at sweaty receptions, as if Britain's pandemic-plagued months of lockdowns, masks and social distancing were a bad dream. The delegates were visibly younger, more diverse and less dominated by affluent residents of southern England than they had been for years.

You wouldn't have seen this even 10, 15 years ago, the north turning out in such droves to support the Conservative Party, said Max Darby, a delegate who was born in the northern England town of Scunthorpe. I think Boris has to be doing something right if people like me are more than happy in fact proud to vote Conservative.


(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)


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