We have the powers

“There is a rule in engineering that applies just as well to government. When a system keeps producing the wrong result, find the flaw and fix it. Do not bolt a workaround on top and call it a solution.”

Britain has spent forty years bolting on workarounds.

Wages too low to live on, so we top them up with tax credits. Housing too expensive, so we pay housing benefit to landlords. Energy bills unaffordable, so we send out a winter payment. Each of these was a reasonable response to an immediate problem. None of them touched the thing generating the problem, and every one of them costs money forever.

That is not a criticism of the people who built them. People inside a broken system use the tools they have. A council officer negotiating a viability assessment, a family on Universal Credit, a landlord raising the rent – all of them are behaving sensibly given the machine they are standing in.

Fixing the machine is a different job, and only one body can do it. Government can change the law. Nobody else can.

So the fair question about everything in this report is not whether it would be nice. It is whether it can actually be done, and what it would take.

Most of it is already legal

Here is the thing that surprised us in the writing.

The overwhelming majority of what this report proposes needs no new institution, no new department, no commissioner, no tsar, and no Act of Parliament. It needs ministers to use powers that already exist, and in several cases powers that were created for exactly this purpose and then left on the shelf.

The Procurement Act is in force. The Subsidy Control Act is in force. Development corporations have had the power to buy land at agricultural value since 1946, and Parliament refreshed compulsory purchase reform in 2023. The Bank of England Act already requires the Treasury to tell the Bank what the government’s economic objectives are, every year. The mechanism for taking a failing water company into public hands has been on the statute book since 1991 and was strengthened last year.

We are not proposing to build a new machine. We are proposing to switch on the one we already have.

And the fiscal rules are a vote

One thing deserves saying before the audit, because it is the load-bearing myth of British politics.

The fiscal rules that supposedly forbid all of this are not in a treaty. They are not in an Act. They sit in a document called the Charter for Budget Responsibility, and the Charter takes effect when the House of Commons votes for it.

That is the whole apparatus. A motion, a division, a majority. Britain has done it ten times since 1997 and will do it again.

Every time a minister says the rules will not allow it, what they mean is that they have decided not to ask the Commons.

The audit

What follows is every substantive proposal in this report, the instrument that delivers it, and whether that instrument exists today.

Proposal	Instrument	Status
Money
National Infrastructure ISA	Treasury regulations governing ISA eligibility	Exists
Non-tradable national development stock	National Savings and Investments; National Loans Act 1968	Exists
Pension allocation to domestic infrastructure	Occupational pension regulations	Powers exist; new regulations
Direct credit for smoothing cash flow	Ways and Means facility at the Bank of England	Exists; extended in 2020
Changing the fiscal rules	Charter for Budget Responsibility	Commons vote
Guardrail
Material and supply chain capacity assessment	National Infrastructure and Service Transformation Authority	Exists; needs resources
Workforce capacity assessment	Skills England	Exists; needs resources
Capacity data to support both	Procurement framework conditions; Statistics of Trade Act 1947, schedule amended by order	Exists; order if needed
Tax
Capital gains taxed as income	Finance Bill	Annual, routine
Digital services tax rate	Finance Bill	Annual, routine
Annual tax on high wealth	New legislation and a valuation system	New. Genuinely hard
The Bank of England
Halt active QT gilt sales	Treasury remit letter to the Bank	Exists
Tiered reserve remuneration	Bank operating framework, under Treasury remit	Exists
MPC advisory, appointed by Parliament, advice published	Amendment to the Bank of England Act 1998	New legislation
Land and housing
Buying land without hope value	Levelling-up and Regeneration Act 2023 directions	Exists
Buying land at existing use value at scale	Development corporation powers, New Towns Act 1946	Exists
Ending ransom strips	New primary legislation, on the model of the utilities’ existing rights	New legislation
Restricting portfolio purchase of existing homes	New primary legislation; surcharge from announcement	New legislation
Protecting new council homes from sale	Social Housing Bill	Before Parliament
Rebalancing bank capital towards productive lending	Prudential Regulation Authority rules; Financial Policy Committee	Exists
Energy and utilities
Water into public ownership	Special administration, Water Industry Act 1991, as strengthened 2025	Exists
Personal liability for water executives	Water (Special Measures) Act 2025	Exists
Reforming how electricity is priced	Energy market arrangements, under the Energy Acts	Exists; review concluded in 2025
Publicly owned generation	Company law; existing public energy company	Exists
Existing renewable contracts	Run to expiry	No action
Work and procurement
Social value conditions in public contracts	Procurement Act 2023	Exists
Reserving contracts for local and smaller firms	Procurement Act 2023	Exists
Strategic support for domestic industry	Subsidy Control Act 2022	Exists
Bargaining at sector level	Employment legislation	Partly in train
Delivery
Devolved single-pot funding	Existing combined authority powers	Exists
Municipal energy, housing and transport companies	Existing local government powers	Exists

Four rows in bold. Three bills and one hard problem, against forty years of being told the whole thing was impossible.¹

When a minister tells you it cannot be done, ask which of the rows in that table they mean.

The powers are there. They have been there all along.²

Now, Brexit

Britain left the European Union. That is a fact, not an argument, and this report is not going to relitigate it.

But an audit of what Britain can legally do has to say where that sits, so here it is, as flatly as we can manage.

The honest finding is that it barely matters to this plan. Almost everything above was lawful before 2016 and would be lawful again. State aid rules did not stop Germany from running KfW, a state development bank with a balance sheet in the hundreds of billions. They did not stop France keeping EDF energy, or Italy running the development bank Cassa Depositi e Prestiti. The European Union borrowed €800 billion for its own recovery fund. Whatever prevented Britain from building things, it was not European Treaties.

That matters for the argument in this report, because it removes an excuse. If our paralysis had been imposed from outside, leaving would have cured it. We left, and nothing changed, because the constraint was always at home.

Two things do turn on membership, and they should be named.

Direct monetary financing by a central bank is prohibited by the EU treaties. So is the arrangement we propose for the Bank of England, since the treaties require national central bank independence. Neither is central to this programme – the financing model here runs primarily on savers’ money and pension money, not on printed money – but they are real differences and we are not going to pretend otherwise.

A future government wanting both this programme and EU membership would have choices to make. It might note that Britain would also be expected to adopt the euro, which no serious person believes would happen, and that Sweden has declined to do so for a quarter of a century by the simple method of not qualifying. And if the UK started negotiations 10 years into this programme, this isn’t a request for indulgence – it’s an operating industrial programme with a supply chain, an order book and a workforce. That changes the character of a negotiation as a matter of course. Practical accommodations are the ordinary currency of European politics, and many exemptions have happened before and are in force now.³

And there is a cleaner route, which is the one this report would take anyway. Long-term contracts with arms-length companies in public ownership are compatible with almost any framework, because legal certainty is a principle every European state respects.

Whether Britain rejoins is a question for the public, and not one for this document. What can be said is that it will not happen soon. Any application would follow a long period in which Britain had to demonstrate settled intent, and no one on either side of the Channel thinks otherwise.

So we get on with it in the meantime. If the question reopens in fifteen years, it will be answered by a country with cheaper energy, more houses and a functioning industrial base, negotiating from a considerably better position than the one we are in now.

Where it actually gets built

One more thing the audit shows.

Almost none of this happens in Whitehall. Councils build the housing, run the planning departments, own the buses and hold the land. Combined authorities run transport and skills. Municipal energy companies are lawful and several already trade. The retrofit programme is a street-by-street operation that no central department could run and no central department should try to.

Which is the same lesson again. 

“Whitehall’s instinct when something needs doing is to create a new body to do it, because it does not trust the ones it has.”

That is a workaround. The fix is to fund and empower the institutions that already exist, and then hold them to account for the results.

What we can’t audit

Every row in that table has an instrument attached. But there are four things no Act of Parliament can confer.

The first is political will. Someone has to win this argument. Not impossible. Not in my power to complete this afternoon. That is the real constraint – not the law, not the technology, not the money. Politicians up to the task.

The second is state capacity. Spending rose for decades while the ability to deliver fell, because much of the money went on outsourcing. Recoverable: fund the institutions that exist. Civil servants get the chance they have never been given.

The third is continuity. At current rates, twenty years is fourteen Prime Ministers. But, if we give certainty for workers and business, perhaps we’ll see stability return. The post-war housing programme ran under eight prime ministers of both main parties.

The fourth is a certainty not just a risk. Some of it will go wrong. Sites will hit contamination. Programmes will overrun. A leisure centre will open a year late. We might be hit by another pandemic. There is no plot protection.

Training project managers, engineers and project accountants does not make failure impossible. It makes it correctable. And public failure has one feature that private failure does not: you can see it. An overrun turns up in committee papers and the local paper. A PFI deal that went wrong sits behind commercial confidentiality, and the public finds out fifteen years later from the National Audit Office, if at all. Not a programme that never fails. One where the failures are visible and fixable.

Two other points. The compensation formula for common ownership of utilities will be litigated. That argument is well rehearsed elsewhere, no need to repeat it here. And Britain already depends on workers trained abroad, especially in health and care. This plan rests on training people here, whatever their heritage, and we want to be clear about that.

Then climate, the largest of them, and the only one where the honest answer is that this plan might not be enough. Britain will need mitigation infrastructure nobody has costed. Sea defences, water storage, drainage, cooling, a grid that holds in conditions it was not designed for. Doing all of this now does not make us immune to climate change. It does give a resilient country with trained people and a state that can deliver major projects. We are behind the pace climate physics is setting. We have to stop patching and start fixing things properly.