Forget the tidal lagoon – the people of Wales have more pressing concerns

Ben Ramanauskas

July 9, 2018

The Government has scrapped plans to create a tidal lagoon in Swansea. This is welcome news for a number of reasons.

The tidal lagoon is just one example in a long list of poorly thought-out vanity projects in which the supposed benefits are based on dubious calculations. Projects such as the tidal lagoon and HS2 are not good value for money. Construction costs inevitably spiral out of control, and it is ordinary households on modest budgets who are left to pick up the tab. These white elephant projects tend to benefit a tiny minority of the population, at the expense of everybody else.

This is not to say that Wales does not need to improve its infrastructure, just that this is the wrong way to spend taxpayers’ money. The railways, for example, are appalling. Trains are antiquated and cost a lot to maintain, passenger numbers are up, overcrowding is rife and delays are a real issue.

If the Welsh government wants to do something to make a real difference to the lives of people in Wales, it should start here. And, yes, this could involve the United Kingdom government spending some money, too. However, the Assembly in Wales holds the power over matters of transport – they should focus on scrapping the outdated franchise model, and open up the railways to true competition.

Instead of handing what amounts to a monopoly to one operator, there should be true competition where firms are exposed to the full force of the market which would ensure that they provided great service to consumers at a reasonable price.

But it isn’t just the woeful railways that are a problem for Wales. It has far bigger things to worry about. Education standards in Wales are the worst across the entire country. The Welsh government has failed in its duty to provide an adequate level of education for children in Wales, and as a result, the life chances of people growing up on the Welsh side of the border are greatly diminished when compared to children in England.

The failure of the Welsh government risks creating a lost generation where people do not have the skills they need to succeed in the world and to get a high paying, rewarding job. Not only is this a tragedy for the children growing up in Wales, but it is also bad for the rest of the UK as a whole.

Then there is the NHS. Healthcare across Britain is shamefully poor when compared to other countries around the world. As The Guardian once, unironically, reported: “The only serious black mark against the NHS was its poor record on keeping people alive.”

However, things are particularly bad in Wales with former Prime Minister David Cameron once referring to Offa’s Dyke as “the line between life and death”. Waiting times in Wales for both routine and urgent care are longer than in the rest of the UK, meaning a patient in Newport must come to terms with the knowledge that they will face worse care than, say, a patient in Bristol.

So not only does the Welsh government fail the children of Wales, it also fails the sick. The Welsh government needs to get its priorities straight. Instead of moaning about central government rejecting a plan on a illogical tidal lagoon, it should focus its attention and energy on fixing the problems that leave children growing up ill-equipped for the future, and patients in hospitals facing many more risks than are necessary.

But let’s put to one side the fact that there are much bigger issues in Wales that should be prioritised. Questions also need to be asked about why this source of energy generation was chosen in the first place.

While it is important for politicians to take serious steps to protect the environment and ensure that energy is generated in a sustainable manner, there is a lack of evidence about the claims that tidal lagoons would generate enough energy in a cost effective way.

The fact that it was to be built on Swansea Bay seems to have riled Welsh nationalists who have claimed that this means Wales is being “failed”. Whether this was to be built on the coast of Wales, England, Scotland or Northern Ireland, it would not have changed the fact that taxpayers would be splurging out money on a scheme even though there was little evidence of the supposed benefits. If our hard-earned cash is going to be used on such projects, then the claims put forward about the benefits need to stand up to scrutiny.

Indeed, the tidal lagoon project raises issues about the government’s involvement in the energy market in general. There is a cost of living crisis in the UK, and high energy prices are a contributing factor. The spiralling cost of energy is often used as an example of how the energy market is broken and why the government needs to intervene, or even to nationalise energy companies.

A significant proportion of energy prices are the result of the various schemes that have already been imposed by government. Such schemes offer subsidies to the renewable energy sector which end up being paid through energy bills. Together with related green measures, they represent a significant proportion of the retail gas and electricity price. For example, the annual bill for a typical dual-fuel household in 2016 was around £1,160, of which £615 was for gas and £545 was for electricity. Approximately £105 (nine per cent) of the bill was the result of low-carbon policies.

The situation for consumers would have been even worse if the tidal lagoon had got the go-ahead, as the developers had asked for a guaranteed price for the electricity generated – meaning that, as always with minimum pricing laws, the poor would be hit hardest.

So, if the Welsh government wants to help people, it should focus on improving schools so that Welsh children have just as many opportunities as children growing up in England; it should focus on fixing the mess that the NHS is in so that patients west of the border aren’t forced to take part in a postcode lottery; and it should focus on sorting out the railways so that people have greater mobility while keeping costs down.

The reality is that the people of Wales have more pressing concerns than a lagoon. Nationalist politicians can spin this however they like, but it doesn’t change the fact that Cardiff is failing the people of Wales, not Westminster.


Ben Ramanauskas is a policy analyst at the Taxpayers’ Alliance.


Written by Ben Ramanauskas

Ben Ramanauskas is a research economist at Oxford University and a former adviser to the International Trade Secretary.


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