Great Britain derailed again

[Deleted96908]

Whilst appreciating that there are existing HS2 threads, I wanted to broaden the discussion to encompass George Osborne's efforts to include Chinese contractors in the £14Bn HS2 phase 1 bidding process.

Putting aside for now discussions about whether the UK workforce is equipped to build HS2, I am wondering why Osborne is taking such a short term view of the needs of this country.

And presumably, operating under the same political mandate, (based on his R4 performance this morning, intellectual minnow) Simon Kirby CEO of HS2 ( A new chief executive has been appointed to run HS2 at a salary of £750,000), has just been telling Radio 4 listeners that inviting foreign contractors to bid is a good idea - and then going on to almost brag that the builders of Europe's biggest high speed rail infrastructure in Spain, are also very keen to get involved. At £14Bn who wouldn't want a slice of that very British pie?

If we need these capital projects, shouldn't we be building them? And if we aren't yet equipped, why not invest in our intellectual infrastructure such that before too long we can? By that I mean shouldn't we be equipping universities to educate our youngster appropriately? Speaking here btw as the dad of a second year civil engineering undergraduate.

Talking of competency, as some of you may have seen on the BBC 4 programme on the diesel engine last night, it wasn't so long ago that we were world leaders in high speed trains (Deltic) and of course, who needs reminding about our role in the railway industry all those years ago.

The question is, is this some short sighted gambit by PM in waiting Osborne, to give the Chinese contracts on the one hand, whilst expecting capital investment from the Chinese on the other, or are we really so poorly equipped in this country that we can't do this ourselves?

Chris

 

[Dryce]

The question is the, are we really so poorly equipped in this country that we can't do this ourselves?

I suspect they also think that if the Chinese bid for work they may also offer to invest in the project.

Our basic problem is London - the financial services sector seems to swill with money and pull in talent. While notionally it gives a whole lot back to the economy the swilling money pot doesn't seem to be available for investment in the UK itself - which means that we have to turn to foreign companies and governments that are willing to make long term investments in UK infrastructure.

Another example of this is Hinckley Point.

 

[martyz]

This is too political to comment on (forum rules) don't want to upset admin.Suffice it
to say no surprises, I blame the sheep that enabled them.

 

[grober]

With the news that the chancellor is courting the Chinese for finance to build the HS2 does he not imagine there will be a quid pro quo attached to any deal.
HS2: George Osborne urges China to pitch for £11.8bn contracts - BBC News This on top of their participation in financing the Hinkley Point Nuclear Power Station and building subsequent others why don't we just sell the nations entire infrastructure to the Chinese as a job lot. Save a lot of faffing about. I mean what could go wrong placing the nation in the hands of a bunch of souless grey Apparatchiks with a lamentable record of human rights and environmental disregard. What's next--- the NHS --- the Chinese are big on transplants I believe
[YOUTUBE]bvAOOwvJMZs[/YOUTUBE]

 

[WDB124066]

Unfortunately the post WWII era is over.

God help us.

 

[Deleted member 37751]

Is anyone with any notion of how our country works politically and economically actually surprised by this?!

[YOUTUBE]Ru_YLSNlnw0[/YOUTUBE]

 

[boxbrownie]

I have the answer........because they are a bunch of Knobjockeys........

 

[Deleted96908]

I suspect they also think that if the Chinese bid for work they may also offer to invest in the project.

Our basic problem is London - the financial services sector seems to swill with money and pull in talent. While notionally it gives a whole lot back to the economy the swilling money pot doesn't seem to be available for investment in the UK itself - which means that we have to turn to foreign companies and governments that are willing to make long term investments in UK infrastructure.

Another example of this is Hinckley Point.

Combining this with your comment in one of the VW threads that the current generation is selling off assets to the possible detriment of future generations, aren't we doing the same here?

Isn't this a case of avoiding short term borrowing in return for selling off equity, and in the case of majority ownership, long term control?

 

[Deleted96908]

This is too political to comment on (forum rules) don't want to upset admin.

I don't think so. There's no mention of political affiliation here.

Unfortunately the post WWII era is over.

God help us.

eh?

I have the answer........because they are a bunch of Knobjockeys........

Got me trying to envision that one.

 

[Deleted96908]

why don't we just sell the nations entire infrastructure to the Chinese as a job lot

That's the crux of the matter isn't it?

And furthermore, it makes me laugh, China and Russia both appeal to foreign domestic law and in lieu of this, international law, when it suits them (in this case to protect any potential investment in Britain), whereas their own internal affairs are subject to arbitrary totalitarian decisions.

I mean what could go wrong placing the nation in the hands of a bunch of souless grey Apparatchiks with a lamentable record of human rights and environmental disregard.

They probably see our way of life as being a bit weird sometimes too... besides, (the bigger?), hidden point is that we seem happy to sell our soul in return for IMF approval. Am I the only one here who laughs at the lamentable kissy kissy relationship between Osborne and Lagarde for example?

 

[Red C220]

Has the invitation to tender only been offered to the Chinese or is anyone invited to tender?

Do we actually have a company or companies capable of constructing the HS2 without going a minimum 5x over budget?

 

[Rory]

There's a lot of nervousness about handing over all the telecoms infrastructure in most countries to the Chinese.

It's OK though in the UK, as the UK has appointed a company that checks this stuff for compliance and to make sure there's nothing sneaky going on. The firm is staffed entirely by employees of one of the companies supplying the equipment.

 

[grober]

I believe the Spanish are keen and several other European countries have the capability. A Spanish one crashed not long ago altho that was due to speeding in the wrong place. One thing is certain if the Chinese high speed trains have any widespread problems its extremely unlikely we would hear about it.
ps --you would not see this video in China as YouTube is blocked there.
[YOUTUBE HD]QaMMuyn3X9I[/YOUTUBE HD]

 

[Dryce]

Isn't this a case of avoiding short term borrowing in return for selling off equity, and in the case of majority ownership, long term control?

It's basically turning us all into tenants with foreign landlords and foreign utilities.

 

[Deleted96908]

Is anyone with any notion of how our country works politically and economically actually surprised by this?!

Before saying anything else, PW, probably the most underrated political commentator in the country.

In answer to your question. No. Why don't we find ways of investing in these northern cities and Scotland too for that matter. Is the answer a more federalised model (wishing to avoid discussions on Scottish Independence), similar to the US?

I worked in Muni Finance in New York for a while and the way states can borrow for their own projects, with investors not paying tax on interest/dividends is really cool - until they borrow beyond their means and go bust.

 

[Dryce]

Has the invitation to tender only been offered to the Chinese or is anyone invited to tender?

Anyone. China is only mentioned because Osborne is there touting business relationships.

Do we actually have a company or companies capable of constructing the HS2 without going a minimum 5x over budget?

The cost increases are not always solely the fault of the companies undertaking the work.

The Edinburgh Trams and Scottish Parliament building project cost overruns are examples of how things can get out of hand.

 

[Deleted member 37751]

Has the invitation to tender only been offered to the Chinese or is anyone invited to tender?

Do we actually have a company or companies capable of constructing the HS2 without going a minimum 5x over budget?

The big problem is that there's a massive tendency in this country to go into a bid cheap and then rack up costs as you go along, hence the XYZ budget balloon, all because the proper estimate wouldn't be palatable up front.

I've priced up for work in the past when I was heavily involved in construction and we were absolutely blown out of the water by some bids, bids that turned out to balloon by three and four times the original estimate.

 

[markjay]

Every foreign contract includes mandatory amount/percentage that must be spent locally in the UK.

Foreign companies will bring-in their own management teams, but will still rely on local firms and local workforce.

The difference is not so much in the implications for the local UK workforce actually working on the project, but where the corporate profits go and what tax is paid on these profits.

And of course there is the issue of national pride.

This needs to be weighed against the vast benefits from having international commercial ties with other global market leaders, as opposed to an inward-looking and isolated economy.

So as always there are Pros and Cons...

 

[Dave Barlow]

Why do we not have enough people trained in engineering/construction?
We could build our own projects, and quote for work abroad.

 

[markjay]

Why do we not have enough people trained in engineering/construction?
We could build our own projects, and quote for work abroad.

That is a different discussion... better conditions for employees and higher taxes will make any country uncompetitive in the global marketplace.

To be able to sell at a higher price than others we need an edge - innovation.

This is down to education, tradition, entrepreneurship..... it's to do with our eco-system and culture.

If you invent the world's first jet engine, and later build the world's first jetliner, you can sell it at a premium.

But if all we can do is build trains just as well as anyone else... we don't stand a chance.