Our Whitehall insider imagines what’s going on inside the minds of the mandarins at Great Minster House, home of the DfT

Well, perhaps things are beginning to look up. The department managed to see off all but one of the judicial reviews against the high speed rail project, losing only the challenge on the property compensation issue. But this is hardly terminal, and we will simply re-run the consultation process on this. Meanwhile, we have also managed to complete the major – and politically controversial – procurement for the new Search and Rescue PFI contract without any hitches and no judicial review. Indeed, my mates in that side of the department even tell me that the losing bidder has written in complimenting the department on the integrity of the bidding process! Rail colleagues take note! On the back of the West Coast saga I am sure that is a huge relief to ministers and to Philip Rutnam.

But before I get too carried away, it’s not all cheer. You only have to look at the details of last week’s budget to realise the depth of the economic crisis. With the exception of health, education and overseas aid we are all having to find yet further savings of 1% on our revenue budget, and that’s before the spending round is completed and announced on June 26. And just in case any of you did not notice, the lack of growth and a collapse in tax revenues has made the chancellor’s predictions of reducing the deficit in the life of this parliament look like the proverbial sick parrot.

Let’s remind ourselves that back in 2010 in his emergency budget the chancellor forecast that the deficit would now be at a modest £89bn, with £60bn and £37bn pencilled in for the next two years. In fact that annual deficit currently stands at £121bn, with £120bn and £107bn forecast for the next two years. And that assumes that quite ambitious growth forecasts made by the Office of Budget Responsibility actually materialise. Sadly, since its creation the Office of Budget Responsibility has got all its growth forecasts wrong and has had to consistently downgrade them. Sounds more like the Office of Budget Irresponsibility to me!

As a result of the continuing flatlining of the economy and the complete inability of the chancellor to reduce the deficit, some forecasters are putting it about that there may have to be further spending cuts of around £25bn after the next election! Not that I can see an incoming Labour government being able to stomach that, so perhaps we will all have to face heavy tax rises instead. All I can say is that if spending cuts on the scale suggested are indeed the solution, the transport budget is going to be pretty depleted come 2015/16 – unless, of course, you are working on high speed rail, which I suspect will continue to be showered down with cash.

That said, I wonder if Philip Rutnam will be making out a case for protecting the transport budget from the worst excesses of these cuts. In a recent interview with Civil Service World he boldly proclaimed that “there’s never been a time when transport and infrastructure have been more important to the government’s economic agenda”. I couldn’t agree more. Perhaps there may be some hope, then, that the Treasury will recognise the short-sighted nature of cutting back on transport spending. The real problem though, is that if ministers continue to hack at the revenue budget while protecting the capital budget as far as possible in order to grab positive headlines in the short term, all they do is store up problems for the future.

But let’s not be too downhearted. For those of you who did not spot the recent press reports, the rock band The Reform Club (named after the Liberal club in Pall Mall of the same name), of which our very own Norman Baker is an esteemed member, is to cut its first rock album. Something tells me that Norman’s talents aren’t quite up there with Elvis, The Beatles, the Rolling Stones or Led Zeppelin, but I am assured that he is not without talent. There is, however, something slightly incongruous in the image of Norman Baker, the suited parliamentary under secretary of state for transport, who in years past had a reputation for being one of the dullest MPs in the House of Commons, and Norman Baker the ageing rock star dressed up in leathers strumming his guitar to the strains of Love Me Tender, Ticket to Ride or Stairway to Heaven.

All I can say is that I hope Norman will treat us all to an evening concert sometime before he leaves the DfT!

 

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