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The Prime Minister has set out how £ 5bn would be spent on infrastructure projects to make the UK “recover better”. Boris Johnson compared his plan to the New Deal of former President of the United States Franklin Delano Roosevelt.
Reality Check has taken a closer look at some of the ads:
‘New deal’
Boris Johnson said, “It sounds like a New Deal … because that’s what the times demand.”
In the early 1930s, the New Deal program increased the role of the state in the economy and was designed to help the United States recover from the Great Depression.
Comparisons between government programs in different countries, 90 years apart, are very difficult to make: our economies have changed without recognition.
Furthermore, there are strong arguments that it was Roosevelt’s structural reforms that involved things like banking and social security that caused the recovery.
However, there have been some valiant attempts to try to bring New Deal spending into some kind of modern context.
Remember that the New Deal ran for several years, with annual spending of between 5% and 7% of the economy’s total output (GDP) each year.
Boris Johnson’s £ 5 billion represents less than a quarter of one percent of GDP.
To get an idea of the scale of the increase in public spending in the 1930s, the debt of the US federal government grew from 16% of GDP in 1929 to 44% of GDP in 1939.
Hospital expenditure
Ahead of the speech, it was announced that £ 1.5 billion would be earmarked for the upkeep and construction of hospitals, the removal of mental health dormitories and increased A&E capacity.
It would be part of the money pot known as the capital budget. This expense is the money we use to build new hospitals or repair existing ones. It is also spent on new equipment, such as MRI machines.
This spending declined between 2010-11, when conservatives came to power, and 2017-18 by about 7% in England, according to the Health Foundation. This was because the NHS was concentrating its resources on the daily operation of the health service, such as paying staff. However, recent announcements have seen the refocusing of spending on capital projects.
In the Spring 2020 Budget, the capital budget of the Department of Health and Social Welfare increased by £ 1.1 billion, bringing the annual budget to £ 8.2 billion.
The department has said that the £ 1.5 billion announced on Tuesday is all “new” money, which is above the previous £ 1.1 billion.
It should also be faced with an existing £ 6.5 billion backlog already needed to fix problems in NHS buildings.
Road projects
The government has pledged £ 100 million this year for 29 road network projects to “get Britain moving”, including:
- Bridge repairs at Sandwell in the West Midlands
- improving the A15 in the Humber region
- £ 10 million to “unlock the Manchester city center bottleneck”
But this is a relatively small amount of money for a large number of projects.
And it is not new.
The money set out in the Spring Budget has been allocated for infrastructure investment.
Schools
The Prime Minister reiterated Monday’s promise of £ 1 billion for 50 school building programs starting in September 2021.
This is also the allocation of some of the infrastructure costs announced in the Spring Budget.
And there have been no details of which 50 schools will receive the money.
On Monday Johnson announced £ 200m for further education.
But this turned out to be only advancing some of the £ 1.5bn over the five years promised in the Conservative manifesto for further education.
And on Tuesday, Johnson did not mention these £ 200 million, referring entirely to the £ 1.5 billion.
Tree plantation
The Prime Minister repeated his commitment to plant more than 75,000 acres of trees (about 30,000 hectares) each year by 2025.
But conservative-led governments for the past decade have consistently fallen short of the tree planting targets set in their election manifests.
Tree planting is a delegated problem in the UK, but England’s tree planting record is particularly poor compared to other European countries.
Government funding and support saw nearly 3.6 million newly planted trees in England in the two years from 2017 to 2019, covering an area of approximately 2,300 hectares.
That figure does not include trees planted to replace others that have been cut down.
In the same period, Scotland planted 18,300 hectares, including 84% of all new trees planted in the UK in 2018-19.
As for Johnson’s general comparisons with Roosevelt’s New Deal in the 1930s, the President of the United States established a Civilian Conservation Corps of hundreds of thousands of unemployed youth (women were not allowed to join).
Over three billion trees were planted across the country by the end of the decade, an achievement that exceeds everything the UK government now promises to do.
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