Britain’s new Prime Minister was bound to disappoint in the end – but couldn’t she have kept us all starry eyed with admiration just a little longer before dashing our expectations against the rocks?
As bad decisions go Theresa May’s go-ahead for the Hinkley Point C nuclear reactor is right up there with the disastrous PFI deals made in the Tony Blair era. And for the same reasons: where was the cost-benefit analysis, where is the sense of fiscal responsibility, where is the respect or consideration for the taxpayers who’ve been saddled with the bill?
On almost any measure, the Hinkley Point C project is a truly spectacular waste of taxpayers’ money.
The EPR (European Pressurized Reactor) technology for which Britain is paying the French company EDF massively over the odds is already out of date. There are better, more modern alternatives – such as the APR1400 from South Korea – which could be brought on line more quickly and more cheaply.
The electricity it will eventually produce will be the most expensive in the world. Under a deal made by the ludicrous former Energy and Climate Change Secretary Ed Davey – described as one of the “worst in history” – Britain will be obliged to pay £100 per megawatt hour (in today’s terms – but it’s index-linked, so will be £125 by the 2025 start date) almost three times above the current market rate, for a period of 35 years.
Most of this is pure subsidy: the National Audit Office has calculated that it will add £30 billion to electricity bills over that period – or a total of £1,000 per household.
According to Paul Homewood that’s an underestimate. He believes the project may end up costing Britain a total of £84 billion at current prices – half of which will be in subsidies.
But perhaps the most worrying part is what it tells us about the character of Theresa May and Britain’s future prospects under her administration.
Till now, Mrs May has played her cards close to her chest, enabling commentators of all hues – myself included – to project onto the Prime Minister their preferred image of the kind of leader they want to see.
Those of us on the libertarian side of the Conservative argument have hoped (not on much evidence it must be said, other than her gender; and the fact that her chief adviser Nick Timothy seems pretty sound) that she will turn out to be a radical free-marketeer in the manner of Margaret Thatcher, that she really does mean it when she says “Brexit means Brexit” and that she will seize the opportunity to deregulate the UK economy and turn Britain into New Singapore.
Those on the Big State interventionist side of the argument will have been encouraged by her remarks about excessive corporate pay rates, about the need for an “industrial policy” and her plans to “help the poor” and give “less priority to the wealthy.”
By giving the go-ahead to Hinkley Point C, she has sent a pretty clear signal that she will not be the new broom that sweeps away all the excess, waste and half-baked gesture politics of the ancien regime. And that also, while she talks a tough game, she doesn’t really have the courage of her convictions and will tend to choose the easy, Civil-Service-endorsed path rather than the one of high principle.
I mean seriously: if you’re a no-nonsense, commonsense Prime Minister in the tradition of Margaret Thatcher, someone who genuinely cares about good housekeeping, sensible industrial policy and the plight of the poor, then the last thing on God’s earth you’re going to do is authorise a project like Hinkley Point C.
It’s hugely expensive; it’s a massive hostage to fortune concentrating so much of Britain’s power production – 7 percent – in one place; it will undoubtedly run over budget; it’s economically unnecessary, there being many better, quicker ways of producing cheaper energy – tapping into Britain’s massive shale gas reserves, for example; and it will saddle British taxpayers with a burden they’ll still be bearing by the time most of you reading this will long be dead.
Theresa May had a perfect opportunity to establish some clear blue water between her new regime and that of David Cameron by killing this white elephant stone dead.
Now she’s blown it and the worst may be yet to come. Brexit? HS2? Can we really trust her to make the right decision on anything?