King's Speech: Too much regulation and too much hope?

“There was nothing unexpected in today’s King’s Speech. The new Labour Government has laid out an ambitious programme of change. There is rather a lot of change here and the key will be delivery. The civil service will be challenged to deliver on the scale and reach of this change. This Labour Government’s strategy is based around regulations and there will be a dramatic increase in government regulation. This is not always welcome as over-regulation can constrain economic growth. The plan to accelerate housebuilding comes with major challenges that are outside the control of the UK government and this includes persuading investors to invest. There is then the question of skill shortages in the construction industry. There is a paradox in this speech in that this Government likes some types of private sector business, but not all. For example, it is anti-private sector railway companies and the plan to take the train operators into public ownership severs this country’s railway infrastructure from private sector investors. This is also a government that dislikes independent schools and believes that taxing the provision of education services comes with positive benefits. 

There is perhaps too much regulation in this King’s Speech and too much hope. Thus, it is hoped that alterations in the planning system will result in 1.5 million new homes being built over the next five years. But what about the over 700k homes that are vacant. It is also hoped that the new tax on independent schools will fund 6,500 new teachers. This remains to be seen as the danger is that rather too many independent schools will close, and this will place an additional burden on state-maintained schools. One should be wary of too much change as this produces uncertainty. This is a government who plans to deliver economic stability but based on making many strategic changes. There is a real danger that all these changes, these unknown knowns, will enhance uncertainty. It is important to remember that this government has inherited a strong economy and one that is forecast to grow over the next 16 months. This growth comes from the activities of the former Conservative Government, and it will be interesting to see if all these changes will lead to additional economic growth. Only time will tell.”