The age of May - and what it means for infrastructure

As the participants return from Birmingham to their respective areas, Julian Francis looks at what was revealed at this year's Conservative party conference and what it might mean for the construction and infrastructure sector.

The speeches are over, the convention hall has been cleared, and the delegates have gone home. As we mark the end of the Conservative party conference, we can begin to see what the future has in store for the country and our industry.

Given the mood and tone of the prime minister's main conference speech, it seem pertinent that this year's conference was held in Birmingham. This more than anything else shows the well spring of Mrs May's political philosophy. Two clues to the importance of the city and its influence on British politics were provide at the very start of the administration and her speech on Wednesday marked the reveal. 

Standing outside Number 10 to give her first speech as PM to the country, Mrs May reminded us that the full title of the party she leads is the Conservative and Unionist Party. Although she seemed to emphasise this in terms of the debate about Scottish independence, it also highlights the merger in 1912 of the historic party of Disraeli's Conservatives, the Tories of the shires, with the Liberal Unionists who had split with Gladstone over home rule for Ireland. 

The next day in the rose garden during her first press conference, May stated that one of her political heroes was Joseph Chamberlain, the Birmingham liberal politician who was the intellectual powerhouse of the Liberal Unionist Party. A leading light in conservative-led governments around the end of the 19th and beginning of the 20th centuries, his legacy shaped Conservative thought up till the 1970s. So much so, that both of his sons would lead the Conservative and Unionist Party, although Neville's legacy is more mixed than his father's. 

The power base of the Chamberlain family was Birmingham where the family firm made screws and provided the economic base for Joseph's political rise to be mayor of the city. A pioneer of metropolitan activism, Chamberlain believed that there was a role for the state in shaping markets and allowing people to achieve their potential. He rebuilt his city and went on to bring these ideas into national politics, laying the groundwork for our modern state.

Knowing this, the prime minister's speech, with its call for civic activism and a role for government to balance the needs of the individual and society, makes a great deal of sense. Mrs May is mining a deep deposit of liberal thought that has shaped Conservative attitudes for over a century. The free market libertarian views of the recent past are giving way to an older civic activism that marked the basis of the party's success for much of the last century. Where better than Birmingham to make this call to action? 

This readjusted outlook is reflected in the approach that the government is taking to infrastructure investment. The chancellor has made it clear that he will borrow to invest by taking advantage of low interest rates. Investment for civic improvement is no sin but rather a duty to be performed. The first signs of this change in policy has been seen in transport policy, with more money for road and rail announced by Chris Grayling. Yet these announcements also highlight the role that the government sees for infrastructure investment in delivering economic growth and productivity. 

The Treasury now feels that smaller strategic investment in pinch points along Eddington principals will deliver better returns to the UK economy than a preoccupation with large scale projects. This more than anything else seems to lie at the heart of the decision not to place the National Infrastructure Commission on a statutory footing as the government wishes to ensure that infrastructure planning is itself subject to the industrial strategy. Less grand visions and more practical solutions is what is now sought after. 

Treasury ministers are, however, open to ideas that their predecessors weren't, such as the creation of infrastructure bonds and a national balance sheet. Both of these ideas would be very much in keeping with Chamberlainite thought. Metropolitan autonomy and local borrowing for investment were tools that laid the foundations for the city of today.

In fact, a monument to this legacy stands in a building opposite to the ICC and was passed by delegates daily. The headquarters of the the Birmingham Municipal Bank were housed here and marked a bold experiment in local financing. Founded by act of parliament and owned by the city, the bank was the UK's only municipal bank where investors’ money was channelled into civic investments such as local infrastructure. This private solution to public problems is one that would be well worth the attention of ministers today as it could be a powerful tool for the new metro regions.

So Birmingham's history marks the way for the countriy's future. Greater civic activism by government coupled with increased autonomy for cities and regions is the prime minister's lodestar. This provides our industry with real opportunities to achieve some of our most sought after objectives around stable financing and decision making for infrastructure, allowing for a more secure investing environment. 

To realise this potential we must understand the political forces that now drive the government and shoulder our share of the burden so that we may provide as many solutions as possible rather than expecting government to do everything. Industries that place civic improvement on an equal basis with commercial gain will go far in the coming years under this prime minister. 

Julian Francis is director of policy and external affairs at the Association for Consultancy and Engineering.