One of Labour’s pre-eminent thinkers is to resign his party’s whip in the House of Lords after being recruited by George Osborne to head a newly created National Infrastructure Commission.
Andrew Adonis, Tony Blair’s former policy chief, will sit as a cross-bench peer to allow him to chair the new statutory body that will advise the government on new infrastructure projects.
The chancellor – addressing the Conservative party conference on Monday – will hail the appointment of Lord Adonis as a sign of his determination to occupy what David Cameron has called the “common ground” as the Labour party “runs to the hills” under the leadership of Jeremy Corbyn.
Osborne will seek to portray the Tories as the real “workers’ party” in his speech to the Tory conference on Monday, where he is expected to reiterate his announcement in his summer budget of a “national living wage” that is due to rise to £9 an hour by 2020 for workers over the age of 25.
The poaching of such a high-profile New Labour figure – the father of Blair’s schools academy programme and of the HS2 rail line – will be seen as a highly political move by the chancellor as he follows the former Labour prime minister’s “big tent” approach as a way of occupying the centre ground. “I think you can see what Andrew Adonis thinks of Labour’s prospects under Jeremy Corbyn by this move,” said one Tory source.
Treasury sources added the appointment of Adonis was designed to take the politics out of infrastructure projects as the government seeks to create a permanent and wide-ranging body, in the mould of the Davies commission that examined airport expansion.
This suggests the chancellor is keen to endorse the findings of the independent commission, chaired by Sir Howard Davies, which recommended the building of a third runway at Heathrow.
A spokesperson for Jeremy Corbyn said: “We have heard it all before from Osborne and the Conservatives on infrastructure and their record is one of complete failure to deliver. There is still nothing to indicate that the Tories understand the desperate need for serious long-term investment in infrastructure - and the real story of their conference remains their attack on working people through the cut on tax credits.”
Adonis was a member of the SDP before moving to the Labour party, where he served as head of Blair’s No 10 policy unit in his first term in office before his elevation to the House of Lords.
He served as schools minister under Blair and was promoted to the cabinet as transport secretary by Gordon Brown to allow him to indulge his love of railways.
Downing Street and the Treasury know they are vulnerable to concerns raised by a series of Tories, including the influential thinker and former minister David Willetts, about plans to cut tax credits by an average of £1,000 a year for three million of the poorest working families. Lord Willetts warned in the Times last week that the changes could “turn sour”.
Willetts spoke out after the Institute for Fiscal Studies said it was “arithmetically impossible” for the new national living wage to compensate low-paid workers for the cut in tax credits.
The prime minister said the average family, whose main breadwinner works full time on the minimum wage, would be better off by some £2,400 a year when all the tax changes were taken into account. Cameron told The Andrew Marr Show on BBC1: “We are protecting the lowest-paid people with the child tax credit and what goes with it.”
The new commission, which will be modelled on the independent fiscal watchdog the Office for Budget Responsibility, set up in legislation after the 2010 election, will advise the government on which infrastructure projects should be prioritised.
These will cover roads and rail, including the east-west HS3 rail line, the new north-south Crossrail 2 line linking Surrey and Hertfordshire, and energy projects such as the new generation of nuclear power stations.
Adonis wrote a major report for Labour in the last parliament on how to revive Britain’s cities outside London. But he was frustrated the leadership was slow to follow on his ideas and watched with envy how Osborne drew on the thinking of the former deputy prime minister, Michael Heseltine, which provided the template for the chancellor’s “northern powerhouse”.
The appointment of Adonis to the new infrastructure commission shows the chancellor is so confident politically that he is not averse to stealing ideas from Labour. Ed Miliband pledged to establish an almost identical commission in the Labour manifesto for this year’s general election.
This was modelled on the Armitt commission established by Ed Balls in 2012, to examine how to speed up infrastructure projects. John Armitt’s work was undermined the following year when Balls questioned the HS2 project, sending Labour’s northern municipal leaders into the arms of Osborne.
Adonis will say: “Without big improvements to its transport and energy systems, Britain will grind to a halt. I am pleased to accept the chancellor’s invitation to establish the National Infrastructure Commission as an independent body able to advise government and parliament on priorities.
“Major infrastructure projects like Crossrail and building major new power stations span governments and parliaments. I hope it will be possible to forge a wide measure of agreement, across society and politics, on key infrastructure requirements for the next 20 to 30 years, and the assessments which have underpinned them.”
The chancellor will say in his speech: “I am delighted to tell you that the former Labour cabinet minister and transport secretary Andrew Adonis has agreed to be the commission’s first chair. He’ll now sit as a cross-bench peer and help us create Britain’s plan for the future – working together in the national interest.”
Osborne will add: “Where would Britain be if we had never built railways or runways, power stations or new homes? Where will we be in the future if we stop building them now? I’m not prepared to to turn to my children – or indeed anyone else’s child – and say: I’m sorry, we didn’t build for you. We have to shake Britain out of its inertia on the projects that matter most.”
In his speech, Osborne will announce that he will encourage the 89 local authority pension funds to invest in infrastructure projects by pooling their resources into half a dozen British Wealth Funds. They will each control assets of more than £25bn.
This article was written by Nicholas Watt Chief political correspondent, for theguardian.com on Monday 5th October 2015 00.01 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010