Under pressure from business bodies, its own backbenchers and just about everybody else, the government has gone into full initiative mode. Though full details are awaited, it appears to comprise:
- up to £50 billion of government guarantees for infrastructure spending, £10 billion of them for housing.
- an easing of planning rules, particularly for housebuilding, but also other developments.
- a "business bank".
There is a strong dose of New Labour about this raft of initiatives. £40 billion of the infrastructure guarantees were announced in July, so only the housebuilding is new.
The government has been in a mess on planning since the Conservatives and Liberal Democrats were in opposition, first proposing what amounted to a Nimby (not in my back yard) charter, before eventually seeing the light on the need to speed planning from the centre. This is just another step along that road.
The "business bank", it seems, is a website that will bring together existing initiatives, not a new bank at all. It remains to be seen if there is anything further.
None of this means some of these things won't be important over the medium term, particularly the infrastructure guarantees. But this flurry of announcements is driven mainly by politics.
Meanwhile, on a day when the EEF came out with a downbeat manufacturing survey, the manufacturing purchasing managers' index actually recorded a reasonable rise, from 45.2 in July to 49.5 in August. That still means the sector is contracting, though only marginally.
According to Markit, which prepares the data: "The downturn in the UK manufacturing sector showed signs of easing during August, following a severe contraction in the previous month. The seasonally adjusted Markit/CIPS Purchasing Managerís Index rose to 49.5, from 45.2 in July, a four-month high and only slightly below the 50.0 mark that separates expansion from contraction.
"Manufacturing production fell for the second successive month in August, albeit to a much lesser degree than in July. The decline in output was centred on the investment goods sector. Output rose solidly at consumer goods producers, while intermediate goods companies saw a marginal return to growth."