We think this is both true and absolutely fascinating:

Between 1949 and 1978, according to an important paper by Jagjit Chadha and Issam Samiri for the Productivity Institute, net public sector investment averaged 4.5% of GDP. It then fell precipitately in the Thatcher years to zero, before climbing under New Labour from those depths to nearly 3% of GDP in 2010. Austerity prompted another steep fall, since when it has bumped along at about 2% of GDP. Overall, the rate of public sector investment from 1979 to 2021 has run at less than half the rate of the previous 30 postwar years. Cumulatively (even allowing for privatisation), that means the evisceration of our public services – from schools that are unusable to weak backup systems at Nats.

So, umm, what actually is public sector investment? Well, if the national grid and the power stations and the drains and the reservoirs and the gas pipes and so on are all government owned then it’s the government spending upon the building and maintenance of the national grid, power stations, drains, reservoirs and gas pipes then, isn’t it?

If all of those things are in the private sector then that same investment is no longer part of public sector investment it’s private sector. And as those with decent memories will recall part of the privatisation process was to liberate the private sector to invest in these very areas. Government always had some union or other to pay off rather than fixing the drains. Yes, we know Will Hutton says “even allowing for privatisation” but we’ve read his own source paper and it doesn’t do so. Not as an error, it’s simply not the thing being analysed therefore isn’t worried about.

Government gets out of the investment business, government investment falls. Will Hutton thinks this is terrible, a disaster, we think it’s obvious. We really do think that both logic and knowledge are on our side here - not unusual in a battle of wits with Willy.