Expert Blog

Queen’s Speech 2017: The Government sets out its transport priorities

20170522_Queen's speech 2017

A couple of weeks ago, everything was up in the air. The General Election had resulted in a Hung Parliament, and we couldn’t be immediately, nor entirely, sure what sort of government would come out of it. As we admitted at the time, we had hoped to write about the new Government’s policies on the morning after the election – but we had to put those plans on hold.

Today, a fortnight later, some things are still up in the air. Theresa May, for instance, hasn’t yet concluded her negotiations with Northern Ireland’s Democratic Unionist Party, so we don’t yet know what their conditions are for propping up a minority Conservative administration. But we do know some other things. We know, for instance, that May has survived as Prime Minister for now. We know the names of the ministers beneath her. And we know the sort of policy agenda they will look to enact.

The last of these emerged from this week’s Queen’s Speech. Normally, this is the ceremony by which the Government announces the major policies that it hopes to introduce in the coming year – but this time was different. This time, the announcements covered not one but two years, to account for the all-encompassing significance of Brexit during that time. There were no less than eight Brexit bills written into this Queen’s Speech.

Of course, these Brexit bills are of huge importance to the fleet industry. The nature of Britain’s departure from the European Union will affect everything from the regulations we operate under to the economy we’re a part of.

But Brexit wasn’t the only thing in the Queen’s Speech that will be of interest to fleet professionals. We thought we’d summarise some of its other policies by seeing how they match up to the themes that we established at the start of the election campaign:

AIR QUALITY

You’re probably familiar with the story by now. After years of legal wrangling, the Government was forced into publishing a draft Air Quality Plan ahead of the election. This document should, in theory, have given us a sense of their intentions for diesel vehicles – but it didn’t really. We’ll have to wait until the release of the full Air Quality Plan, which is due by 31 July, or perhaps even the Autumn Budget, until we know whether diesel motorists will face tax hikes, or whether they’ll be compensated by a scrappage scheme.

These policy changes, if they happen, will be hugely significant for fleet operators. They’ll be hugely significant for people outside of fleets too. Yet the Queen’s Speech made no mention of them. In fact, the only time that air quality was mentioned was in connection with the charging infrastructure for electric vehicles. The Government is seeking more powers to make service stations and fuel suppliers install charge points for public use.

This doesn’t mean that the Air Quality Plan won’t be part of the Government’s legislative agenda. It simply demonstrates that, despite its billing, not every policy is included in the Queen’s Speech. Again, fleets will have to wait for the details on diesel.

Technically, there was some action against emissions elsewhere in the Queen’s Speech – although it wasn’t new. You might remember that, before the election, the Government stripped out various parts of the latest Finance Bill to ensure that the most important sections were passed ahead of Parliament’s dissolution. These stripped-out parts included a new system of Company Car Tax for 2020-21, which would have further incentivised the uptake of Ultra-Low Emission Vehicles. The Government promised that these policies would return after the election, and so they may. The Queen’s Speech makes mention of a Summer Finance Bill 2017 that will, presumably, bring the new CCT system back into being.

HEATHROW

Heathrow was a notable absence from the Queen’s Speech. The Government hasn’t officially dropped its plan for a third runway at the airport, but it may be facing up to the realities we highlighted in our previous post. Support for the policy isn’t even certain among Conservative MPs, let alone Labour, Lib Dem and SNP ones. May would struggle to get the numbers she needs.

HIGH SPEED RAIL

This was an area of rare consensus among the major parties ahead of the election, and that was reflected in the Queen’s Speech. The Conservatives are charging ahead with the legislation for the second phase of HS2, which will take the line up to Manchester and Leeds.

However, a swift start doesn’t mean a swift resolution. Major infrastructure projects have a habit of getting stuck in the weeds – indeed, as we’ve written before, the first phase of HS2 took years to make it into law.

RAIL NATIONALISATION

Only one major party ran on a promise to renationalise the entire railway network – and that was Labour. The fact that we now have a Conservative minority government means that renationalisation wasn’t part of the Queen’s Speech. However, this doesn’t mean that it isn’t part of the political conversation. Jeremy Corbyn and his ideas were bolstered by the election result, and they could even find themselves in Number 10 should May’s Government collapse.

BORROWING FOR INFRASTRUCTURE

The Queen’s Speech reaffirmed the Government’s commitment to the new fiscal rules set out by Philip Hammond in his first Autumn Statement and approved by Parliament in January. The main target is to eliminate the deficit as soon as possible, which the Government now deems to be ‘the middle of the next decade’. This doesn’t leave any room to borrow for infrastructure projects in the long-term, although the Government does plan to do so over the next few years.

However, the Government has also promised to ‘reflect on the message the voters sent at the General Election’ in relation to fiscal policy. Given that the Labour Party outperformed expectations while promising a £250 billion investment package, that ‘reflection’ might result in a conversion to greater spending on roads, rail and other infrastructure.

And that is the story of the Queen’s Speech in general. With her majority gone, with her authority weakened, and with the Brexit negotiations underway, Theresa May has had to temper here policy programme. Will the forthcoming Air Quality Plan and the Autumn Budget be as ambitious as they might otherwise have been? We shall find out in the coming weeks and months.

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