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Speaker 1: Bloomberg Audio Studios, Podcasts, radio News. Welcome to voter Nomics,

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Speaker 1: where politics and markets collide. This year, voters around the

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Speaker 1: world have the ability to affect markets, countries and economies

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Speaker 1: like never before, so we've created this series to help

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Speaker 1: you make sense of it all.

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Speaker 2: I'm alegra Stratton, I'm Adriam Woodbridge.

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Speaker 3: And I'm Stephanie Flanders.

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Speaker 4: Right here it is.

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Speaker 1: We've finally got here, actually all three in the same place. A,

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Speaker 1: we're all together and B what a momentous week to

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Speaker 1: be all together.

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Speaker 4: It's the week of the UK election.

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Speaker 1: In this episode, we're looking beyond polling day, if you

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Speaker 1: can believe that, to the administration's first one hundred days,

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Speaker 1: and we'll be asking what can the next government really

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Speaker 1: do given the economy it's inheriting, and can it create

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Speaker 1: the necessary conditions for investors and firms to thrive in

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Speaker 1: the So to help us explore those questions, Stephanie, you

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Speaker 1: spoke to Douglas Flint, chairman and asset manager Aberdeen.

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Speaker 3: I thought Douglas would be an interesting voice to have

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Speaker 3: from the business community, and particularly from financial services, one

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Speaker 3: of Britain's most important service sector industries, and he's had

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Speaker 3: very senior positions at HSBC and KPMG, as well as

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Speaker 3: being on the advisory panel for Labour's Financial Services Review.

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Speaker 3: He's sort of a thoughtful observer as well as a

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Speaker 3: serious player in that world. And I was particularly interested

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Speaker 3: with the support he offered, not just to Labour's focus

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Speaker 3: on growth, which of course most people in the business

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Speaker 3: community want them to focus on growth, but the potential

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Speaker 3: need to raise taxes or borrow more to support that agenda.

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Speaker 3: He was remarkably open to that.

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Speaker 1: Okay, well, we're going to look at that in a

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Speaker 1: bit more detail. And second, we do also have in

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Speaker 1: the studio with us Phil Aldrich, who is going to

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Speaker 1: help us unpick what we can expect out of the

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Speaker 1: first hundred days. But first of all, Adrian column today

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Speaker 1: is fairly punchy on the possible new labor government.

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Speaker 2: My worry is that we are about to elect a

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Speaker 2: labor government with all the power that that entails, because

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Speaker 2: we have a very centralized system with no real checks

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Speaker 2: and balances, and a prime minister with a big majority

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Speaker 2: has enormous power, much more so than the American president

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Speaker 2: in the sense of being no constraints, obvious constraint on

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Speaker 2: that power. And I think we're electing the Labor Party

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Speaker 2: and Starmer to this position without any real scrutiny. This

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Speaker 2: has been an election entirely dominated by the awfulness of

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Speaker 2: the Tories. It's a rejection of the old order, and

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Speaker 2: we haven't really asked difficult questions of the new government.

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Speaker 2: And I think that the more one looks at it,

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Speaker 2: the more I at least and worried. It seems to me,

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Speaker 2: in particular that the education policy, which consists of removing

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Speaker 2: the twenty percent viaight exemption on schools, in other words,

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Speaker 2: increasing the price to parents of private education by twenty percent,

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Speaker 2: is symptomatic first of all of a bias towards the

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Speaker 2: state sector public sector producer lobbies the teacher unions in particular,

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Speaker 2: and secondly, a hostility towards excellence, independent traditions. And I

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Speaker 2: think this bad labor runs through all sorts of that's

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Speaker 2: a preser.

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Speaker 3: I mean, okay, so I think the pushback would be

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Speaker 3: and it came partly from your old employer. We saw

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Speaker 3: the Economist endorse Labor this week, and of course a

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Speaker 3: big chunk of that was as a sort of vote

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Speaker 3: against the Conservative Party, which we've seen obviously in a

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Speaker 3: lot of the endorsements that the Labor has had. But

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Speaker 3: I think that the Economists leader did also take the

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Speaker 3: time to make a positive case for Keir Starmer in

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Speaker 3: particular and what he'd done to the Labor Party. So

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Speaker 3: I think the response to you would be you draw

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Speaker 3: a negative comparison with Tony Blair as being more about

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Speaker 3: change and about bringing in multiplicity of providers for education

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Speaker 3: and health. I mean the argument against that would be,

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Speaker 3: actually he has changed, He inherited a very unreconstructed Jeremy

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Speaker 3: Corbyn led Labor Party, has brought it back to the

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Speaker 3: Blairite center and will have now a mandate to make

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Speaker 3: some quite difficult changes in public services, which would actually

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Speaker 3: be much harder and more divisive for a conservative party

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Speaker 3: to do. We tend to make the classic sort of

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Speaker 3: Nixon to China argument that it's easier for Labor to

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Speaker 3: do that than the Conservatives. I just wonder why you

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Speaker 3: don't think, looking at his record, that he wouldn't be

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Speaker 3: quite ruthless.

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Speaker 2: I'd love to be able to agree with you about that.

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Speaker 2: But if you look at the Labor Labour's education and policy,

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Speaker 2: that policy was created under Jeremy Corbyn by Angela Rayner.

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Speaker 2: I remember going to labor body conferences in which the

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Speaker 2: teacher unions were cheering that to the rafters.

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Speaker 3: It's making problems though, isn't it. I mean, this is

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Speaker 3: really the argument, right, that that's actually a bit of

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Speaker 3: red meat to where they.

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Speaker 2: Don't need to be giving meat to these dogs because

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Speaker 2: they've been aimed.

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Speaker 5: This.

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Speaker 4: This is the funder point.

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Speaker 2: I think he does believe, because in the.

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Speaker 1: Past week they've all come out with quite full throatated support.

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Speaker 2: Absolutely, this is a party rooted in the public sector,

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Speaker 2: with very very public sector producerist passions. His instincts a

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Speaker 2: pro public sector at a time when we really need

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Speaker 2: to improve the productivity of the public sector. And he

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Speaker 2: has this idea of industrial policy, if you want to

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Speaker 2: call it industrial policy whatever, whatever it is, state activism,

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Speaker 2: state intervention in the economy, and Britain has a dismal

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Speaker 2: record at that. And the Labor Party seems to be saying, look,

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Speaker 2: Britain is broken. The state is broken, let's spend more

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Speaker 2: money on it and give it more responsibilities.

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Speaker 3: Stephanie, anything else you No, I think it's going to

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Speaker 3: be exhilarating this new government. People say it's going to

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Speaker 3: be terribly boring and they're not doing anything but if

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Speaker 3: for nothing else, but we can continue to have this

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Speaker 3: very lively debate.

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Speaker 1: Patiently listening to all of this has been one of

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Speaker 1: Bloomberg's most brilliant reporters, Award winning award winning Phil Oldrick,

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Speaker 1: Phil just to go quickly to it first one hundred days,

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Speaker 1: What do you think will be most interesting?

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Speaker 4: If it's a labor government.

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Speaker 6: Well, they're going to have to get through these key bills,

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Speaker 6: so the workers rights that's going to be a big development,

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Speaker 6: and then the planning reforms, which you know, that's the

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Speaker 6: most exciting thing if they could actually come up with

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Speaker 6: something which does make you transform the UK's performance. We'll

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Speaker 6: probably have the budget in early September or mid September.

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Speaker 6: If they don't hold it before the party conferences, it's

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Speaker 6: not going to come till sort of late October. And

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Speaker 6: then there's this big question of whether we have a

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Speaker 6: single year spending review just to sort of roll over

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Speaker 6: year so that they can really build some proper plans.

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Speaker 6: They say they're going to drive or pay for everything

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Speaker 6: by getting growth, So will there be an increasing growth

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Speaker 6: prospect in that intervening year, and then you don't have

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Speaker 6: to raise taxes quite as much. What are going to

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Speaker 6: have to be big spending increases.

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Speaker 1: But Phil, you are an expert on all these matters.

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Speaker 1: Is it possible for them to be demonstrating kist Armer

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Speaker 1: said the other day needs two point five percent growth,

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Speaker 1: which is more than America's enjoying right now. Is it

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Speaker 1: possible for him to be demonstrating signs or indications that

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Speaker 1: they're getting two point five percent growth in the next

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Speaker 1: twelve months.

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Speaker 6: Yeah, I mean that is stretched. This is the thing.

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Speaker 6: If Liz trust as she did, say that I'm going

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Speaker 6: to deliver you two point five percent growth and it's

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Speaker 6: going to pay for everything, then everyone's going to say,

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Speaker 6: what a load of nonsense, and you know, throw the

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Speaker 6: sterling out with the bathwater. And that is not going

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Speaker 6: to happen under Kistamer because they know that lesson and

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Speaker 6: they're not going to basically predicate their entire policy on

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Speaker 6: a two point five percent growth schedule. They are going

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Speaker 6: to be raising taxes or increasing borrowing and you know,

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Speaker 6: so there are you know, you can change the fiscal rules.

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Speaker 6: I think it's very unlikely for them to do that

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Speaker 6: immediately after winning the election because they've come in on

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Speaker 6: a manifesto with a set of very type fiscal rules,

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Speaker 6: you know, so they won't be able to release.

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Speaker 4: He's borrowing to invest. You don't think they'll do that.

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Speaker 6: They limited to the exact same degree because it's the

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Speaker 6: debt rule that's binding.

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Speaker 3: Rather we should we should just summarize quickly. There's the

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Speaker 3: borrowing to invest, which is just how much were making

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Speaker 3: sure that what you borrow every year is no more

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Speaker 3: than what you're using for investments, so you can't be

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Speaker 3: using it to for example, very fast rising bit of

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Speaker 3: the bill, debt interest, paying interest on the debt, how

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Speaker 3: much you're borrowing year to year. And then there's the

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Speaker 3: stock rule. It's like how much is your total debt

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Speaker 3: going up and is it stabilizing? And this rather odd

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Speaker 3: rule that says in five years time you have to

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Speaker 3: be able to show that the debt stock is going

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Speaker 3: to fall relative to your economy. It doesn't matter what

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Speaker 3: it's doing in the four years before that, as long

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Speaker 3: as out and at the moment they are very very

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Speaker 3: close to that. Because Jereby Hunter is not given much

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Speaker 3: room for men.

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Speaker 6: Exactly there was eight point nine billion pounds headroom in

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Speaker 6: the last budget, and so they don't have any money

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Speaker 6: to spend, and there they're bound by that same figure.

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Speaker 6: So there is they are going to have to They're

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Speaker 6: either going to have to get better growth and so

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Speaker 6: it won't go to two point five percent, but it

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Speaker 6: may be the growth projection for the country will be

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Speaker 6: a bit better and that will generate a little bit

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Speaker 6: of extra income. But inevitably there are I think everybody

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Speaker 6: assumes there's going to be some tax rises.

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Speaker 3: And tax rise is to prevent a tough squeeze on

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Speaker 3: public spending advice.

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Speaker 6: So I mean they've got so you've got to settle

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Speaker 6: these junior doctors strikes. You know, there's other pay deals.

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Speaker 6: So the pay review bodies have delivered there what they

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Speaker 6: want this year to the departments, but no one has

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Speaker 6: seen these yet because obviously we're having the election instead.

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Speaker 4: And the junior dots is are wanting thirty four to

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Speaker 4: thirty five.

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Speaker 6: Percent exactly, so they're never going to get that. But

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Speaker 6: there could be a big extra bill to pay for

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Speaker 6: the public sect to workers, and there is the prisons

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Speaker 6: are in absolute chaos, so you can see that there's

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Speaker 6: going to be immediate demands. So it seems likely that

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Speaker 6: there will be some additional tax policy in the if

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Speaker 6: it is a September budget, just to get over that bump,

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Speaker 6: or they could.

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Speaker 5: Sort of fiddle the figures.

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Speaker 6: And do some kind of just just try and take

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Speaker 6: on a little bit of extra boring. But I think

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Speaker 6: you know it's subsequently we're going to see some some

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Speaker 6: broader tax rises for next year.

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Speaker 3: I mean, you spend a lot of time talking to

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Speaker 3: the Treasury and the Bank of England. Do you get

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Speaker 3: the sense that they're expecting quite a big first budget

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Speaker 3: from Rachel Reeves despite the very limited promises in the manifesto,

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Speaker 3: or is it a question of a we're going to

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Speaker 3: build credibility. Do they think they've got time to build credibility,

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Speaker 3: or do they really need to do something quite dramatic

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Speaker 3: on growth.

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Speaker 6: I thought originally that they were going to do a

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Speaker 6: big first budget, because you know, you can hit the

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Speaker 6: ground running. But all the noise I'm hearing is that

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Speaker 6: it's going to be it's not going to be a

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Speaker 6: huge first budget, and that you know they're going to

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Speaker 6: basically it's going to be next year that you're going

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Speaker 6: to see, if necessary, these big tax risers. And because

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Speaker 6: obviously the big issue is what you do with spending

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Speaker 6: and how you fix spending. And they haven't really got

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Speaker 6: time to do a proper spending review because the depth

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Speaker 6: of investigation that's needed to do at these at the

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Speaker 6: departmental level to really come up with proper plans.

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Speaker 3: So how do you get around that because they've got

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Speaker 3: they need new plans for April.

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Speaker 6: Yes, so they'll do it one years, they rolled, so

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Speaker 6: they'll beat. They'll have the spending plans for a single

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Speaker 6: year and then then they build out the bigger, broader

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Speaker 6: plans for three to five years beyond that next year. So,

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Speaker 6: I mean, that's one thing that's that's one thing that

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Speaker 6: I'm increasingly hearing from, you know, around in the policy circles.

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Speaker 4: Good quick question when you say next year, do you

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Speaker 4: mean a spring budget or.

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Speaker 6: So an autumn budget next year for well autumn budget

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Speaker 6: and spending review.

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Speaker 3: So like every chancellor, she said she's only going to

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Speaker 3: have one big fiscal event, but they never do.

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Speaker 6: We'll see.

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Speaker 1: I do think, you know, it's not an open ended

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Speaker 1: book for them. They've got to crack on pretty quickly

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Speaker 1: in order to we all say, you know, landslide is

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Speaker 1: going to be huge, you know, two three term prime minister.

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Speaker 1: But we did say that about Boris point. It did

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Speaker 1: look and you know, not long after twenty nineteen that

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Speaker 1: that administration could go on and on and on, and

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Speaker 1: part of their problem was how do you deliver on

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Speaker 1: leveling up within four to five years? It was always

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Speaker 1: going to be tough, and you know, potentially the answer

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Speaker 1: is they didn't. But the same challenge is going to

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Speaker 1: be the case for Starmer. How does he deliver for

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Speaker 1: these people he has persuaded he is different.

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Speaker 6: Yeah, well, that's that's going to be the big question,

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Speaker 6: isn't it. The I think again, do you think it's

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Speaker 6: going to come down to planning and the sort of

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Speaker 6: you know, do you bring HS two back, that second

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Speaker 6: leg of HS two as well Northern And it's those

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Speaker 6: kind of big infrastructure projects where you can demonstrate that

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Speaker 6: you're doing something for these regions even if it doesn't

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Speaker 6: get completed in time. But the actually, you know, things

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Speaker 6: are under way and this general building.

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Speaker 2: I mean, doesphologists say that he's likely to get this

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Speaker 2: big victor on a pretty small proportion of the vote.

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Speaker 2: We also have a very unstable electric for example, and

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Speaker 2: there's there's red wall voters again who will go back

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Speaker 2: are not going to be permanent demonstrated pus promiscuous is

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Speaker 2: a very good word, the right word. But I do

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Speaker 2: think there's a big difference between Kirs Starmer and Boris Johnson.

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Speaker 2: That Boris Johnson was a liberty jib and Kirs is

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Speaker 2: you know, he's clearly somebody who is is interested in

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Speaker 2: achieving results and has studied the dynamic, the mechanism power.

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Speaker 2: So he will do more. Whether enough, if he does enough,

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Speaker 2: that's a different question. But it's a serious person, which

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Speaker 2: boris never one.

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Speaker 3: I mean the point that you've come back to, I mean,

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Speaker 3: just come back to where we started. I mean, if

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Speaker 3: he does something that genuinely looks like it's going to

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Speaker 3: move the dial on planning and other things that have

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Speaker 3: proven obstacles to raising living standards through higher productivity, it

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Speaker 3: is possible that the Officer Budget Responsibility, which is marking

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Speaker 3: his homework on this and actually give in a sense

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Speaker 3: setting how much lee where he has by making their

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Speaker 3: growth forecast, they could give him some credit in advance.

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Speaker 3: So yes, actually we do think that, and they did that.

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Speaker 3: The record of them doing that with Jeremy Hunt when

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Speaker 3: he cut Nash Insurance in a way that they thought

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Speaker 3: would increase the workforce. So that will be one of

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Speaker 3: the things he can play with, which actually he doesn't

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Speaker 3: have to deliver. He just has to convince the OBR

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Speaker 3: that growth will get up, and that's through those kinds

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Speaker 3: of public investments, but also something it came up with

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Speaker 3: Douglas Flint, sort of softer investments potentially in skills and

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Speaker 3: other things.

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Speaker 6: Yeah, and also just a foreign direct investment talking about

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Speaker 6: France earlier, the UK is looking more attractive in a

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Speaker 6: relative term, so we've been doing pretty well on FDI,

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Speaker 6: so perhaps we do get some of this investment boom

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Speaker 6: that we've been waiting feels like generations for.

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Speaker 3: And at Bluemberg, you will be very well placed to

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Speaker 3: be the first to spot that money coming in.

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Speaker 6: Yes exactly, the data will be there.

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Speaker 1: All right, that's a good place to leave it for now, Phil,

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Speaker 1: But come back when we have this possible neighbor government.

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Speaker 3: As we discussed at the beginning, I had this nice

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Speaker 3: chat with Douglas Flint. We talked a bit about his past.

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Speaker 3: He's now chairman of the asset manager Aberdeen, and I

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Speaker 3: started by asking him, I mean, after all the upheaval

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Speaker 3: we've had under successive Conservative governments and prime ministers. You

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Speaker 3: know whether this might be one time where changing the

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Speaker 3: party in power might be seen by the business world

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Speaker 3: as a vote for stability.

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Speaker 5: I certainly think it's the way the business world is

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Speaker 5: hoping that it plays out, because I think we've had

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Speaker 5: a period of instability, uncertainty and business plans in much

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Speaker 5: longer cycles than political cycles to have the ability to

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Speaker 5: plan because there's a government with a sufficient majority that

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Speaker 5: it can actually command support of the House of Commons,

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Speaker 5: to get legislation through, to give clarity on what it

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Speaker 5: plans are in important areas of the economy, like infrastructure,

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Speaker 5: like pension provision, retirement provision, and the hope is that

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Speaker 5: we enter a period of stability where there is clarity

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Speaker 5: as to what the policy framework will be. Some people

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Speaker 5: may not like that framework, but it's much better to

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Speaker 5: operate within a framework of certainty rather than the framework

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Speaker 5: of instability and lack of certainty secure.

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Speaker 3: Starmer has made much of the changes he's made to

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Speaker 3: the Labor Party since Jeremy Corbyn's leadership. Rachel Reeves, the

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Speaker 3: Shadow Chancellor, and others have made quite a lot of

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Speaker 3: effort to reach out to business, to hold breakfasts and

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Speaker 3: lunches with people in the city and elsewhere. Is there

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Speaker 3: a basic level of trust for labor among the business community.

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Speaker 5: I think there's been a real sense of gratitude that

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Speaker 5: there has been that reach out, and particularly because that

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Speaker 5: reach out has been you need to help us to

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Speaker 5: understand what we need to do, or what the reaction

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Speaker 5: will be if we do something different from what you're expecting,

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Speaker 5: and so on and so forth. So I think there's

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Speaker 5: been a level of reach out which has been help

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Speaker 5: us to understand, whether it's an energy or transportation or

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Speaker 5: financial services. And that's encouraging because I think the relationship

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Speaker 5: between business and government has gone up and down over

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Speaker 5: the last you know, fifteen twenty years or whatever, and

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Speaker 5: I think business would like to feel that it has

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Speaker 5: a role to play, and it's good that there is

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Speaker 5: engagement with business today and a willingness to listen. Now,

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Speaker 5: how that gets translated is where the rubber hits the road.

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Speaker 3: You know, as an economist, it's been an ongoing topic,

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Speaker 3: this sort of lack of productivity growth in the UK,

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Speaker 3: which of course the only way you really raise living standards,

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Speaker 3: making more stuff with the same number of people. And

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Speaker 3: there's been a sort of dynamic around this where economists

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Speaker 3: and others have pointed to the sort of micro underlying

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Speaker 3: reasons holding back growth, planning, lack of skills, these kind

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Speaker 3: of broader aspects of the environment, macroeconomic stability. And then

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Speaker 3: what successive governments have done when, in the name of

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Speaker 3: helping business has been cutting corporation tax and focusing on

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Speaker 3: taxes and not on those micro things that are quite difficult.

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Speaker 3: Do you think there's an appetite for the reverse of

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Speaker 3: that under a new government in return for addressing some

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Speaker 3: of those difficult things, you know, making people build more houses,

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Speaker 3: pushing through more big infrastructure programs. The business community might

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Speaker 3: be open to some increased taxes because it looks like

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Speaker 3: there's not going to be many increases in personal taxation

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Speaker 3: given how many things Rachel Rees has ruled out.

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Speaker 5: If you ask any business or any individual would you

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Speaker 5: like higher taxes? The answer istrigued. But on the other hand,

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Speaker 5: if you say, if we can build an economy where

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Speaker 5: there is growth and your business will prosper and your

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Speaker 5: family income will do well, are you prepared to invest

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Speaker 5: into that growth in the economy? Growth and the family income.

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Speaker 5: Are you you know, are you happy to invest in

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Speaker 5: it in a society where you're you can visibly see

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Speaker 5: that the infrastructure you operate within and the services you

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Speaker 5: enjoy are better. I think you know people will will

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Speaker 5: respond to that. But but of course that is the

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Speaker 5: trade off.

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Speaker 3: I know you've been part of the advisory panel for

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Speaker 3: Labour's Financial Services Review. What advice are you giving them?

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Speaker 3: Would you give them now? What should they be looking

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Speaker 3: out for and their traps to avoid when it comes

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Speaker 3: to financial sector in particular.

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Speaker 5: Well, I was one of ten that were asked to

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Speaker 5: basically review the document they produced on policy for the

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Speaker 5: the financial services industry and a policy framework that starts

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Speaker 5: off with we will un a shamedly champion the financial

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Speaker 5: services industry of the UK is one of our core

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Speaker 5: strategic assets. It's a pretty good opening and and the

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Speaker 5: kind of the exam question was is there anything in

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Speaker 5: this that you think is silly, won't work? Is there

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Speaker 5: anything you think is missing? Is there anything you think

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Speaker 5: will attry in particular comment from media or other commentators,

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Speaker 5: and the vast majority of forres and it was straightforward, I mean,

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Speaker 5: the political stuff wasn't in it because that's a political

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Speaker 5: choice and wasn't in the policy framework. But to start

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Speaker 5: off with a framework that you believe that you need.

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Speaker 5: You have a financial services sector that is extraordinarily full

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Speaker 5: of skills that you need to grow the economy, and

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Speaker 5: you want to harness those skills and control them in

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Speaker 5: a an appropriate way without overreach. It's a very good

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Speaker 5: start for engagement with the sector. I mean, I think

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Speaker 5: the financial sector is always kind of believed. You tell

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Speaker 5: us what you want us to do, and we will

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Speaker 5: help you achieve it. And I hope that that is

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Speaker 5: the dialogue with whichever government we end up in a

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Speaker 5: week's time.

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Speaker 3: Are they a labor underestimating the costs of clamping down

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Speaker 3: even more comprehensively on the non dom status, which the

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Speaker 3: kind of thing one hears a lot in the city

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Speaker 3: of people planning to leave because Labor is proposing something

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Speaker 3: that's actually a bit tougher than what the Chancellor introduced

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Speaker 3: earlier this year.

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Speaker 5: Look at a political choice. I'm not going to comment

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Speaker 5: on the relatives.

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Speaker 3: Do you know people who are talking about I think

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Speaker 3: it's a.

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Speaker 5: Result talking about it. But I think that in the

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Speaker 5: context of the scale of the economy, I think it's

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Speaker 5: a factor, but not a huge factor. I also think

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Speaker 5: that there are many other factors that attract people to

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Speaker 5: the UK than just the rate of tax that they pay.

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Speaker 5: I mean security, the lifestyle, the arts, the culture, the

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Speaker 5: connectivity to other parts of the world, the rule of law.

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Speaker 5: All of these things are factors. There may well be

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Speaker 5: people for whom that tax change, as it's implemented, will

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Speaker 5: impact the way that they live their life, But you know,

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Speaker 5: in terms of the shape of the economy as a whole,

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Speaker 5: I don't think that's one of the biggest issues.

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Speaker 3: Some of the people who've been talking about moving to

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Speaker 3: France are now rethinking as a result of the turbulence

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Speaker 3: there and the possibly we've had one round but a

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Speaker 3: quite dramatic response result of the second round of the

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Speaker 3: French elections. Are you hearing that that actually suddenly some

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Speaker 3: parts of Europe actually also are looking a bit unstable uncertain.

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Speaker 5: Well. I think that what's handing in France at the

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Speaker 5: moment reminds people that things can happen that are unpredictable.

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Speaker 5: Nobody saw that coming. People talked about UK election, the

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Speaker 5: US election, and all of a sudden we've got election.

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Speaker 5: We didn't expect in France with potentially quite dramatic consequences

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Speaker 5: depending on how you play it through, and that could

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Speaker 5: have an impact on Europe. And again, I think in

441
00:22:28,520 --> 00:22:32,040
Speaker 5: terms of the narrow conversation around the City of London,

442
00:22:32,480 --> 00:22:36,439
Speaker 5: instability elsewhere is actually quite good for the City of

443
00:22:36,440 --> 00:22:39,240
Speaker 5: London in terms of it attracts business, it attracts talent,

444
00:22:39,840 --> 00:22:44,280
Speaker 5: it attracts people. It kind of highlights the resilience stability

445
00:22:44,320 --> 00:22:47,359
Speaker 5: of the City of London and our legal system for.

446
00:22:47,400 --> 00:22:51,960
Speaker 3: An international business in any sector, what's the framework to

447
00:22:52,520 --> 00:22:55,920
Speaker 3: plan against in a world where Donald Trump is elected

448
00:22:56,000 --> 00:22:56,639
Speaker 3: in November.

449
00:22:59,600 --> 00:23:03,399
Speaker 5: I think, you know, one of his one of its

450
00:23:03,520 --> 00:23:09,600
Speaker 5: characteristics is he's unpredictable, and yet when he was in power,

451
00:23:09,800 --> 00:23:13,439
Speaker 5: some of the fears that people had didn't materialize, some

452
00:23:13,440 --> 00:23:16,440
Speaker 5: some did, so I guess it would be a foolish

453
00:23:16,440 --> 00:23:19,200
Speaker 5: person who said they know exactly what he's going to do.

454
00:23:19,400 --> 00:23:23,000
Speaker 5: He's obviously still got to get elected, and there's no

455
00:23:23,240 --> 00:23:26,200
Speaker 5: certainty over that. There's a long there's a long way

456
00:23:26,320 --> 00:23:30,200
Speaker 5: to go. But I think people will reflect thoughtfully on

457
00:23:31,440 --> 00:23:36,200
Speaker 5: either of the two candidates as to how America, what

458
00:23:36,280 --> 00:23:38,280
Speaker 5: role will America play in the world, whether it's a

459
00:23:38,280 --> 00:23:40,879
Speaker 5: security role, whether it's an economic role, whether it's a

460
00:23:41,440 --> 00:23:44,320
Speaker 5: role that attracts seeks to attract more and more economic

461
00:23:44,400 --> 00:23:47,080
Speaker 5: value into the United States, or whether it wants to

462
00:23:47,119 --> 00:23:51,200
Speaker 5: share its economic power with others to create you know, friends,

463
00:23:51,240 --> 00:23:55,359
Speaker 5: and I personally don't think that the major issues that

464
00:23:55,440 --> 00:24:00,760
Speaker 5: face the world in terms of bidiversity, climate, demographics, migration,

465
00:24:01,480 --> 00:24:04,879
Speaker 5: and aging population within demographics can be sold without nations

466
00:24:04,880 --> 00:24:07,719
Speaker 5: working together. So you can't have one winner and everyone

467
00:24:07,720 --> 00:24:13,480
Speaker 5: else living a terrible existence. And you know that Europe, America, Asia,

468
00:24:13,520 --> 00:24:17,320
Speaker 5: led by China, the Middle East are all fundamental actors

469
00:24:17,320 --> 00:24:20,439
Speaker 5: and this so I would hope that whoever is the

470
00:24:20,480 --> 00:24:23,359
Speaker 5: president of the United States reflects on the contribution they

471
00:24:23,400 --> 00:24:25,480
Speaker 5: can make through leadership to the rest of the world.

472
00:24:26,720 --> 00:24:31,200
Speaker 3: I've had a number of senior investors privately at least,

473
00:24:31,440 --> 00:24:35,840
Speaker 3: and certainly some business leaders across Europe, including the UK, say,

474
00:24:36,560 --> 00:24:40,320
Speaker 3: if Donald Trump is elected, especially given the kind of

475
00:24:41,000 --> 00:24:43,600
Speaker 3: spending he wants to do and the tax cuts, but

476
00:24:43,680 --> 00:24:47,440
Speaker 3: also the way he does tend to see the world

477
00:24:47,440 --> 00:24:50,720
Speaker 3: in a sort of zero, some American first way, if

478
00:24:50,720 --> 00:24:53,320
Speaker 3: he gets elected, I'm going to do everything I can

479
00:24:53,400 --> 00:24:55,679
Speaker 3: to be attached to the US because that's where all

480
00:24:55,720 --> 00:24:57,680
Speaker 3: the money's going to be, and money's going to be

481
00:24:57,720 --> 00:24:58,840
Speaker 3: sucked out of everywhere else.

482
00:24:59,359 --> 00:25:02,080
Speaker 5: I've heard say that. I don't think that's a good answer,

483
00:25:02,359 --> 00:25:07,159
Speaker 5: because I think that we need to build societies in

484
00:25:07,200 --> 00:25:11,480
Speaker 5: the rest of the world that have resilience for our children, grandchildren,

485
00:25:11,520 --> 00:25:14,120
Speaker 5: and we don't do that if we concentrate all economic

486
00:25:14,200 --> 00:25:17,399
Speaker 5: power in any one part of the world. And I

487
00:25:17,400 --> 00:25:19,880
Speaker 5: actually don't think that will happen because, in a kind

488
00:25:19,920 --> 00:25:23,800
Speaker 5: of a way, I think governments would react to business

489
00:25:23,840 --> 00:25:27,600
Speaker 5: if business said we're only going to bet on one team,

490
00:25:27,680 --> 00:25:31,040
Speaker 5: one flavor of success, because at the end of the day,

491
00:25:31,840 --> 00:25:34,320
Speaker 5: governments are elected by people who've got jobs, and if

492
00:25:34,359 --> 00:25:37,920
Speaker 5: you've organize your economy so that the jobs are all

493
00:25:37,960 --> 00:25:39,879
Speaker 5: somewhere else, there are many more people who are not

494
00:25:39,920 --> 00:25:42,720
Speaker 5: going to be supportive of the policies that have led

495
00:25:42,760 --> 00:25:45,640
Speaker 5: that to happen. I also think talking to American business,

496
00:25:45,640 --> 00:25:48,400
Speaker 5: they recognize that if they want to have the export

497
00:25:48,480 --> 00:25:51,919
Speaker 5: markets they want, they can't capture everything for themselves, but

498
00:25:52,040 --> 00:25:54,760
Speaker 5: still expect people to buy their goods and services. You know,

499
00:25:54,800 --> 00:25:57,960
Speaker 5: I don't believe the worst extrapolation of what could be

500
00:25:58,000 --> 00:26:01,760
Speaker 5: done by any political per personality will come to pass,

501
00:26:01,920 --> 00:26:03,359
Speaker 5: because I don't think they would work.

502
00:26:03,480 --> 00:26:06,639
Speaker 3: Going back to the UK, assuming we do have a

503
00:26:06,680 --> 00:26:09,480
Speaker 3: new government, a labor government we have, if we have

504
00:26:09,600 --> 00:26:13,480
Speaker 3: our first woman chancellor. Lots of ifs, but the polls

505
00:26:13,480 --> 00:26:16,560
Speaker 3: are put certainly putting that way. In nineteen ninety seven

506
00:26:17,560 --> 00:26:20,960
Speaker 3: there was that big first surprise move that Gordon Brown

507
00:26:21,000 --> 00:26:23,879
Speaker 3: did of making the Bank of England independent, which was

508
00:26:23,920 --> 00:26:26,320
Speaker 3: not only a sort of shock and all moment, but

509
00:26:26,400 --> 00:26:30,480
Speaker 3: actually also sent a very powerful signal about microeconomic stability

510
00:26:30,520 --> 00:26:34,000
Speaker 3: and tying one's hands and I think reassured maybe the

511
00:26:34,080 --> 00:26:38,159
Speaker 3: business community after many years of Conservative rule. Would you

512
00:26:38,200 --> 00:26:41,760
Speaker 3: have any advice for Rachel Reeves about in her first

513
00:26:41,800 --> 00:26:47,720
Speaker 3: budget what would be a powerful signal about their seriousness

514
00:26:47,840 --> 00:26:51,120
Speaker 3: to achieve growth and to do what they've said they're

515
00:26:51,160 --> 00:26:53,240
Speaker 3: going to do on the campaign which has put growth

516
00:26:53,280 --> 00:26:54,560
Speaker 3: really before anything else.

517
00:26:54,760 --> 00:26:57,399
Speaker 5: I think one of the important things for whichever government

518
00:26:57,480 --> 00:27:01,560
Speaker 5: we have is to think very carefully about how we

519
00:27:01,640 --> 00:27:03,720
Speaker 5: unlock the savings of the nation. I mean one of

520
00:27:03,760 --> 00:27:07,000
Speaker 5: the things that I think we'll look back and reflect

521
00:27:07,040 --> 00:27:08,960
Speaker 5: on whether it went the way that we wanted it to.

522
00:27:09,040 --> 00:27:11,920
Speaker 5: But when we sort of closed defined benefit pension schemes

523
00:27:11,960 --> 00:27:16,320
Speaker 5: thirty years ago and replaced them with defined contribution arrangements

524
00:27:16,359 --> 00:27:23,840
Speaker 5: because the final salary final corporate schemes, and replaced them

525
00:27:23,880 --> 00:27:26,520
Speaker 5: with contribution schemes which are not really which are not

526
00:27:26,560 --> 00:27:30,000
Speaker 5: pension schemes because they're no newsy. At the end of it,

527
00:27:30,280 --> 00:27:32,879
Speaker 5: the contribution rates are probably a half to a third

528
00:27:32,880 --> 00:27:34,520
Speaker 5: of what they would be if we were still running

529
00:27:34,560 --> 00:27:37,600
Speaker 5: defined benefit schemes. So the pool of money going into

530
00:27:37,720 --> 00:27:40,520
Speaker 5: savings for all the things that people save for its

531
00:27:40,600 --> 00:27:43,480
Speaker 5: significantly less, and effectively the city runs on the flow

532
00:27:43,520 --> 00:27:46,080
Speaker 5: of money and the flow of money coming in from

533
00:27:46,480 --> 00:27:49,880
Speaker 5: retirement systems. It's considerably less than it used to be.

534
00:27:50,720 --> 00:27:55,320
Speaker 5: The evolution of people investing against their own risk preferences

535
00:27:55,400 --> 00:27:57,679
Speaker 5: tends to be that people have a much more modest

536
00:27:57,760 --> 00:28:02,359
Speaker 5: risk appetite then they will have vicariously if someone was

537
00:28:02,359 --> 00:28:04,840
Speaker 5: doing it for them, because they can take in pilled

538
00:28:04,840 --> 00:28:07,960
Speaker 5: savings much more, you know, a broader view of where

539
00:28:07,960 --> 00:28:10,399
Speaker 5: they might put their money. And we're in a world

540
00:28:10,440 --> 00:28:13,520
Speaker 5: now where, for all very good reasons, the vast amount

541
00:28:13,520 --> 00:28:16,119
Speaker 5: of money that goes into equities goes into global equities,

542
00:28:16,119 --> 00:28:18,760
Speaker 5: of which, depending on who does the construction, sixty to

543
00:28:18,800 --> 00:28:23,040
Speaker 5: eighty percent goes into US equities because it's market cap waste.

544
00:28:23,119 --> 00:28:25,120
Speaker 3: I think quite a big portion of that's been going

545
00:28:25,160 --> 00:28:26,120
Speaker 3: into Nvidia.

546
00:28:28,520 --> 00:28:31,840
Speaker 5: Yeah, and because one of the things you would also

547
00:28:31,880 --> 00:28:33,600
Speaker 5: want to do is an incoming government say we've got

548
00:28:33,640 --> 00:28:35,280
Speaker 5: to spend more money on infrastructure. If we're going to

549
00:28:35,320 --> 00:28:37,960
Speaker 5: get productivity, we have to do things with infrastructure. That

550
00:28:38,040 --> 00:28:42,280
Speaker 5: means the planning system in large part, but we've got

551
00:28:42,320 --> 00:28:47,600
Speaker 5: to do something to get infrastructure, all the grid, electricity, supply, transportation,

552
00:28:48,480 --> 00:28:50,480
Speaker 5: all that stuff. How are you going to fund it?

553
00:28:50,520 --> 00:28:53,680
Speaker 5: If you can't tax more and you can't borrow more,

554
00:28:53,720 --> 00:28:57,800
Speaker 5: then you've got to channel the population savings into pools

555
00:28:57,800 --> 00:29:02,360
Speaker 5: of assets that offer an attractive return and also offer

556
00:29:02,440 --> 00:29:05,640
Speaker 5: a sort of a benefit to those who are investing.

557
00:29:05,640 --> 00:29:07,280
Speaker 5: And it's saying I'm doing something for the future of

558
00:29:07,320 --> 00:29:09,520
Speaker 5: my kids and my grandkids because we're going to build

559
00:29:09,920 --> 00:29:14,200
Speaker 5: a better society. So I would think very much about infrastructure.

560
00:29:14,200 --> 00:29:18,160
Speaker 5: I think very much about pensions. And I'm not an economist.

561
00:29:18,200 --> 00:29:21,200
Speaker 5: I know you're an absolutely fabulous one, but I also

562
00:29:21,240 --> 00:29:26,600
Speaker 5: think that if you take the analogy of business, we

563
00:29:26,680 --> 00:29:31,480
Speaker 5: absolutely distinguish between borrowing for investment and borrowing for consumption,

564
00:29:32,040 --> 00:29:36,920
Speaker 5: and we have these rules about the total borrowing has

565
00:29:36,960 --> 00:29:39,360
Speaker 5: to come down over the life of a parliament. It

566
00:29:39,400 --> 00:29:42,400
Speaker 5: depends what the borrowings for. If we are borrowing to

567
00:29:42,560 --> 00:29:47,440
Speaker 5: invest and genuinely invest in infrastructure and clinding soft infrastructure,

568
00:29:47,880 --> 00:29:51,560
Speaker 5: and we have the capability as in government to ensure

569
00:29:51,600 --> 00:29:54,480
Speaker 5: that the return on that investment because we can show

570
00:29:54,480 --> 00:29:58,120
Speaker 5: that the pricing of it is adequate, then we should

571
00:29:58,480 --> 00:30:04,000
Speaker 5: be investing in in physical and selft assets infrastructure for

572
00:30:04,040 --> 00:30:06,560
Speaker 5: the future without getting caught up with the fact that

573
00:30:06,760 --> 00:30:10,680
Speaker 5: because our consumption expenditure is rising because of so economy

574
00:30:10,720 --> 00:30:13,400
Speaker 5: or whatever, we can't invest in the long term growth

575
00:30:13,440 --> 00:30:16,400
Speaker 5: of the economy. I think that I know it's been

576
00:30:16,400 --> 00:30:18,160
Speaker 5: a huge debate for a very long period of time,

577
00:30:18,200 --> 00:30:20,120
Speaker 5: but I would at least think about that whether we

578
00:30:20,160 --> 00:30:22,760
Speaker 5: can find a way of saying this is genuinely capital

579
00:30:22,800 --> 00:30:24,880
Speaker 5: expenditure and that's okay.

580
00:30:25,520 --> 00:30:28,880
Speaker 3: Well, you've said two interesting things there and as well

581
00:30:28,920 --> 00:30:31,080
Speaker 3: as being to have being nice about me, but so obviously

582
00:30:31,160 --> 00:30:34,400
Speaker 3: I like that bit. But I do think you've said,

583
00:30:34,600 --> 00:30:36,560
Speaker 3: or you've given the impression. I know you're not speaking,

584
00:30:36,800 --> 00:30:38,520
Speaker 3: be so easy if you spoke for the whole of

585
00:30:38,560 --> 00:30:43,080
Speaker 3: the global the UK financial community and business sector, and

586
00:30:43,120 --> 00:30:45,920
Speaker 3: you don't. But for the purposes of this podcast, it

587
00:30:46,000 --> 00:30:50,240
Speaker 3: is interesting that you've said, actually, if it was genuinely

588
00:30:50,320 --> 00:30:54,400
Speaker 3: for investment, there could be an appetite and an acceptance

589
00:30:54,680 --> 00:30:59,280
Speaker 3: of more borrowing. But also you talked about soft infrastructure,

590
00:30:59,600 --> 00:31:02,600
Speaker 3: suggests that one could also have a broader definition of

591
00:31:02,640 --> 00:31:04,800
Speaker 3: the kind of infrastructure we're talking about. It doesn't have

592
00:31:04,960 --> 00:31:09,240
Speaker 3: to be big hospitals or roads and the things that

593
00:31:09,280 --> 00:31:11,280
Speaker 3: we tend to think of. I have the sense if

594
00:31:11,280 --> 00:31:14,680
Speaker 3: a government, if the next government announced they were actually

595
00:31:14,720 --> 00:31:17,440
Speaker 3: going to change their rules. They've said they won't, but

596
00:31:17,600 --> 00:31:19,800
Speaker 3: they changed the book debt rule in order to be

597
00:31:19,800 --> 00:31:22,120
Speaker 3: able to borrow more over the next five or six years,

598
00:31:22,800 --> 00:31:25,280
Speaker 3: and they were going to broaden the definition of investment.

599
00:31:25,440 --> 00:31:29,680
Speaker 3: They would be jumped on for trying to get away

600
00:31:29,760 --> 00:31:33,200
Speaker 3: with fudging the figures and we're going back to silly

601
00:31:33,240 --> 00:31:36,480
Speaker 3: money and borrowing too much. But you think possibly they

602
00:31:36,480 --> 00:31:37,080
Speaker 3: could make the case.

603
00:31:37,080 --> 00:31:38,840
Speaker 5: Well, I think you would need to demonstrate that you

604
00:31:38,920 --> 00:31:42,440
Speaker 5: were you were genuinely putting it into skills, training and education,

605
00:31:43,280 --> 00:31:47,240
Speaker 5: you were genuinely putting it into the hard infrastructure.

606
00:31:47,840 --> 00:31:49,760
Speaker 3: But that means teacher salaries. I mean if you're putting

607
00:31:49,760 --> 00:31:51,560
Speaker 3: it into skills that's going to then say, well, no,

608
00:31:51,600 --> 00:31:52,920
Speaker 3: you're just paying teacher salaries.

609
00:31:52,960 --> 00:31:55,520
Speaker 5: But if you believed, and if you could demonstrate that

610
00:31:55,600 --> 00:31:58,000
Speaker 5: by having more and better teachers, you would have a

611
00:31:58,000 --> 00:32:01,920
Speaker 5: better workforce, more capable of earning their living and therefore

612
00:32:01,960 --> 00:32:05,760
Speaker 5: not being dependent on welfare. If you had more people

613
00:32:05,800 --> 00:32:10,080
Speaker 5: in employment, then you wouldn't have the need for immigration

614
00:32:10,560 --> 00:32:13,680
Speaker 5: so much. If you had more people employment, then your

615
00:32:13,680 --> 00:32:17,640
Speaker 5: health statistics and your crime statistics should be better. So

616
00:32:17,800 --> 00:32:21,160
Speaker 5: you can make the case. Now, yes, the cynics would

617
00:32:21,240 --> 00:32:23,760
Speaker 5: jump on it, but it ought to be possible to

618
00:32:23,800 --> 00:32:26,200
Speaker 5: make the case, And then the question would be, can

619
00:32:26,240 --> 00:32:28,680
Speaker 5: you actually back up what you've said with what you're

620
00:32:28,680 --> 00:32:33,120
Speaker 5: doing and show the evidence. You know, genuinely, skills training

621
00:32:33,160 --> 00:32:36,800
Speaker 5: is a fundamental underpinning of the economy and we should

622
00:32:36,800 --> 00:32:39,600
Speaker 5: be investing in it. And you know, as individuals, we've

623
00:32:39,600 --> 00:32:43,240
Speaker 5: invested in our own education. So what more important is

624
00:32:43,280 --> 00:32:46,600
Speaker 5: there for future generations than to invest in them.

625
00:32:46,760 --> 00:32:49,520
Speaker 3: Douglas fint I wonder how many others are thinking that

626
00:32:49,600 --> 00:32:54,600
Speaker 3: way across the business community, little in within the new

627
00:32:54,840 --> 00:32:57,080
Speaker 3: labor government. If we get one, thank you very much.

628
00:32:57,160 --> 00:32:59,760
Speaker 5: It's been a pleasure, thank you.

629
00:33:06,920 --> 00:33:09,520
Speaker 3: So I don't know what you guys thought of that.

630
00:33:10,040 --> 00:33:13,400
Speaker 3: You know, he was being very careful not to be partisan,

631
00:33:13,800 --> 00:33:15,760
Speaker 3: but I was interested in not just the air of

632
00:33:15,840 --> 00:33:20,200
Speaker 3: general positivity, but also this sense, at least from him

633
00:33:20,560 --> 00:33:24,480
Speaker 3: that financial services and perhaps the business community generally would

634
00:33:24,520 --> 00:33:28,800
Speaker 3: be relatively relaxed about the idea of higher taxes even

635
00:33:28,840 --> 00:33:33,280
Speaker 3: on businesses at the margin, or higher borrowing if there

636
00:33:33,360 --> 00:33:35,480
Speaker 3: was a real sense that the new government could show

637
00:33:35,520 --> 00:33:37,160
Speaker 3: where the money was going to be invested.

638
00:33:37,600 --> 00:33:37,760
Speaker 5: Yeah.

639
00:33:37,800 --> 00:33:38,280
Speaker 4: Absolutely.

640
00:33:38,280 --> 00:33:41,240
Speaker 1: It's also the idea that France is making us more

641
00:33:41,280 --> 00:33:42,680
Speaker 1: and more attractive that we I.

642
00:33:42,640 --> 00:33:44,880
Speaker 3: Quite like that was just so kind of boldly. You're

643
00:33:44,880 --> 00:33:47,520
Speaker 3: supposed to not want, you know, insecurity on your border,

644
00:33:47,520 --> 00:33:49,360
Speaker 3: and he was like, no, no, actually quite good for

645
00:33:49,400 --> 00:33:49,800
Speaker 3: the city.

646
00:33:51,400 --> 00:33:54,880
Speaker 1: And then as you've also alluded to the idea that

647
00:33:55,560 --> 00:33:58,720
Speaker 1: potentially investing in skills, and I think you guys talked

648
00:33:58,760 --> 00:34:01,560
Speaker 1: a lot about teachers' salaries and whether that would be

649
00:34:01,560 --> 00:34:03,760
Speaker 1: a benign thing for the state to get involved in

650
00:34:03,840 --> 00:34:08,200
Speaker 1: because ultimately would improve education and then people's earning.

651
00:34:08,480 --> 00:34:10,160
Speaker 2: We'll let me first say that I think the most

652
00:34:10,200 --> 00:34:13,480
Speaker 2: important word in all of this is stability, and if

653
00:34:13,520 --> 00:34:16,719
Speaker 2: you can offer stability or offering business a good chunk

654
00:34:16,760 --> 00:34:18,480
Speaker 2: of what it wants. What the Tories did was to

655
00:34:18,520 --> 00:34:22,439
Speaker 2: offer instability and imbecility, and the combination of the two

656
00:34:22,480 --> 00:34:23,840
Speaker 2: wasn't all less attractive. So that.

657
00:34:25,400 --> 00:34:26,880
Speaker 5: Is much.

658
00:34:27,320 --> 00:34:30,880
Speaker 2: You know, taxes matter, but they don't matter anything like

659
00:34:30,920 --> 00:34:31,640
Speaker 2: as much as that.

660
00:34:31,640 --> 00:34:31,719
Speaker 4: That.

661
00:34:31,760 --> 00:34:34,960
Speaker 2: What worries me about a general increase in teachers pay,

662
00:34:35,040 --> 00:34:37,640
Speaker 2: I'm not sure is a very good thing. You need incentives,

663
00:34:37,640 --> 00:34:43,200
Speaker 2: you need differentials, you need a competitive environment for the

664
00:34:43,719 --> 00:34:44,960
Speaker 2: teaching profession, you know.

665
00:34:45,120 --> 00:34:47,400
Speaker 3: So I think it is more about you might be

666
00:34:47,440 --> 00:34:50,759
Speaker 3: investing if you're investing in skills. Ultimately, that would come

667
00:34:50,840 --> 00:34:54,640
Speaker 3: down to teacher's salaries, not necessarily raising their salaries, but

668
00:34:54,680 --> 00:34:57,400
Speaker 3: you'd be spending more money on teachers and calling it investment.

669
00:34:57,560 --> 00:34:58,480
Speaker 4: But it does bring us.

670
00:34:58,440 --> 00:35:01,279
Speaker 1: Back to where we started this podcast switches on that

671
00:35:01,640 --> 00:35:04,520
Speaker 1: being removed from private school fees in the following way,

672
00:35:04,560 --> 00:35:08,600
Speaker 1: which is again whether the Starma government is setting itself

673
00:35:08,719 --> 00:35:12,520
Speaker 1: up for tricky times because they're saying they're doing this

674
00:35:12,920 --> 00:35:14,799
Speaker 1: so they can fund more teachers, but the number of

675
00:35:14,800 --> 00:35:17,440
Speaker 1: teachers they will fund will be one teacher per three.

676
00:35:17,280 --> 00:35:19,959
Speaker 4: Schools, So again you're kind of state school.

677
00:35:20,040 --> 00:35:21,920
Speaker 1: Sorry, So I mean, you get the kind of principle

678
00:35:21,960 --> 00:35:24,040
Speaker 1: behind it, and the philosophy of wanting to bring more

679
00:35:24,080 --> 00:35:26,080
Speaker 1: math teachers, for instance, is the example he uses all

680
00:35:26,080 --> 00:35:28,600
Speaker 1: the time into state schools. Clearly that is a noble aim,

681
00:35:28,880 --> 00:35:30,480
Speaker 1: but whether or not it's actually going to be able

682
00:35:30,520 --> 00:35:32,840
Speaker 1: to do it in any kind, I mean when the fact.

683
00:35:32,680 --> 00:35:34,800
Speaker 3: That the government, anybody who was either in government or

684
00:35:34,800 --> 00:35:37,120
Speaker 3: about to be in government, would like would make numbers

685
00:35:37,200 --> 00:35:39,480
Speaker 3: sound bigger than they really are, and trying to impress

686
00:35:39,560 --> 00:35:42,680
Speaker 3: people with a number of I mean, I'm not to hear.

687
00:35:42,920 --> 00:35:44,239
Speaker 4: But if you look at if you look to put

688
00:35:44,239 --> 00:35:46,359
Speaker 4: it on the side of a bus, if you look.

689
00:35:46,280 --> 00:35:49,120
Speaker 2: At Sweden or Denmark, for example, they allow, they actually

690
00:35:49,320 --> 00:35:51,560
Speaker 2: give state subsidies to people for people to go to

691
00:35:51,600 --> 00:35:54,239
Speaker 2: private schools. But because by going to private schools there,

692
00:35:54,800 --> 00:35:58,480
Speaker 2: they're taking this hang up out of the country. We

693
00:35:58,960 --> 00:36:02,640
Speaker 2: have a hang up, a class based hang up, and

694
00:36:02,760 --> 00:36:05,000
Speaker 2: it presumes that everybody's going to eat nor harrow.

695
00:36:05,239 --> 00:36:07,120
Speaker 3: You know, this hang up doesn't seem to have held

696
00:36:07,160 --> 00:36:10,960
Speaker 3: back the private education sector in the UK an increase.

697
00:36:11,719 --> 00:36:15,359
Speaker 3: Of course, it's gone up way more past inflation over

698
00:36:15,360 --> 00:36:17,840
Speaker 3: the last ten years. No, I just think I don't

699
00:36:18,120 --> 00:36:20,839
Speaker 3: row back a little bit and having a tough time.

700
00:36:20,960 --> 00:36:24,719
Speaker 2: The public schools have behaved disgracefully. They bought it upon themselves.

701
00:36:25,000 --> 00:36:28,759
Speaker 2: They've been irresponsible short term is greedy that you know,

702
00:36:28,880 --> 00:36:30,920
Speaker 2: they deserve to some extent to be punished. But I

703
00:36:30,960 --> 00:36:33,200
Speaker 2: do sympathize with the parents who are going to be

704
00:36:33,280 --> 00:36:33,759
Speaker 2: globbed by.

705
00:36:33,880 --> 00:36:35,440
Speaker 3: I mean, one thing I do think is interesting is

706
00:36:35,480 --> 00:36:38,360
Speaker 3: we would do you think, Adrian and I totally accept

707
00:36:38,400 --> 00:36:41,960
Speaker 3: that it all if other things equal, if you had

708
00:36:42,000 --> 00:36:44,920
Speaker 3: the choice, you probably wouldn't particularly want to have a

709
00:36:45,080 --> 00:36:48,719
Speaker 3: higher rate of tax on education. And it's not that

710
00:36:48,800 --> 00:36:52,520
Speaker 3: it's not what happens across the continent. But today, if

711
00:36:52,560 --> 00:36:56,160
Speaker 3: it wasn't exempt from VAT would be exempt. It would

712
00:36:56,160 --> 00:36:59,120
Speaker 3: any government, including a conservative government, choose to have it

713
00:36:59,239 --> 00:37:01,120
Speaker 3: not be subject to a tax that you pay when

714
00:37:01,160 --> 00:37:03,560
Speaker 3: you buy a kettle, when you buy a fridge, when

715
00:37:03,600 --> 00:37:06,360
Speaker 3: you buy an oven, all these very basic things.

716
00:37:06,160 --> 00:37:09,000
Speaker 2: You pay when you buy when you buy an opera

717
00:37:09,000 --> 00:37:11,360
Speaker 2: ticket VT on it. I mean, there are certain cultural

718
00:37:11,360 --> 00:37:13,200
Speaker 2: goods that I think don't carry.

719
00:37:13,480 --> 00:37:14,040
Speaker 5: Vi AT there.

720
00:37:14,040 --> 00:37:17,040
Speaker 2: But what worries me more than the private public divide

721
00:37:17,440 --> 00:37:20,799
Speaker 2: is the attitude that it embodies. Because when Blair came

722
00:37:20,840 --> 00:37:23,080
Speaker 2: into power, he had this idea that in order to

723
00:37:23,120 --> 00:37:25,600
Speaker 2: improve productivity in the educational sector, you had to have

724
00:37:25,680 --> 00:37:29,240
Speaker 2: league tables, you had to have academy schools or schools

725
00:37:29,280 --> 00:37:32,960
Speaker 2: that could have more independence, You had to have more differentiation.

726
00:37:33,440 --> 00:37:35,719
Speaker 2: Starmer seems to have the opposite attitude, which is you

727
00:37:35,800 --> 00:37:39,800
Speaker 2: just need to spend public sector producers, give them more money,

728
00:37:39,800 --> 00:37:42,760
Speaker 2: and also close down or make competition more difficulty. That's

729
00:37:42,760 --> 00:37:43,520
Speaker 2: the wrong attitude.

730
00:37:43,600 --> 00:37:45,200
Speaker 3: You're going to be able to see in the data

731
00:37:45,320 --> 00:37:47,759
Speaker 3: a massive change in the quality of UK education as

732
00:37:47,760 --> 00:37:50,160
Speaker 3: a result of this one change in vat.

733
00:37:50,280 --> 00:37:53,400
Speaker 2: No I was saying, it's a symbolic it's symbolic of

734
00:37:53,400 --> 00:37:57,000
Speaker 2: an attitude. When Blair came in, he wanted to shake

735
00:37:57,120 --> 00:38:02,880
Speaker 2: up the public sector, make it more meritocratic. When Starmer

736
00:38:02,920 --> 00:38:06,359
Speaker 2: comes in next week, his first line of duty will

737
00:38:06,400 --> 00:38:09,640
Speaker 2: be to remove a pressure, competitive pressure from the system.

738
00:38:09,960 --> 00:38:12,839
Speaker 2: That's not right, that's not good. You know, he needs

739
00:38:12,840 --> 00:38:14,960
Speaker 2: an adonus figure to come in and say, you know,

740
00:38:15,120 --> 00:38:18,440
Speaker 2: let's let's try and turn this country into meritocracy.

741
00:38:18,640 --> 00:38:20,359
Speaker 3: I think it's going to be fascinating to see how

742
00:38:20,400 --> 00:38:22,560
Speaker 3: he governs. And you are right that we don't have

743
00:38:23,000 --> 00:38:24,319
Speaker 3: a good enough idea, but.

744
00:38:24,280 --> 00:38:26,279
Speaker 1: In a week's time we will know exactly what form

745
00:38:26,360 --> 00:38:29,960
Speaker 1: the next government's taking. Thanks for listening to this week's

746
00:38:30,040 --> 00:38:33,640
Speaker 1: Votonomics from Bloomberg. This episode was hosted by me Alegri Stratton,

747
00:38:34,000 --> 00:38:37,680
Speaker 1: Stephanie Flanders, and Adrian Wildridge. It was produced by Samasadi

748
00:38:37,840 --> 00:38:41,720
Speaker 1: with booking support from Chris Martlou, production support and sound

749
00:38:41,719 --> 00:38:46,319
Speaker 1: designed by Moses and Brendan Francis Newnham is our executive

750
00:38:46,360 --> 00:38:50,240
Speaker 1: producer and Sage Bauman is Head of Podcasts. Special thanks

751
00:38:50,239 --> 00:38:54,080
Speaker 1: to Phil Aldrich and Douglas Flint. Please subscribe, rate, and

752
00:38:54,200 --> 00:38:56,520
Speaker 1: review wherever you listen to podcasting

753
00:39:11,840 --> 00:39:12,440
Speaker 6: Aber