This article is from the May issue of Total Politics

Surrender: How British Industry Gave Up The Ghost, 1952–2012
Nicholas Comfort
Biteback Publishing, £20

When Queen Elizabeth II came to the throne in 1952, Winston Churchill, her first prime minister, heralded the coming of the new reign in the House of Commons as marking “a golden age of… science and machinery”, in which the nations of the world would be able to produce “an undreamed-of prosperity with culture and leisure ever more widely spread can come, perhaps even easily and swiftly, to the masses of the people in every land”.

It was clear that such prosperity would be supplied by Britain. Her factories were making the transition from wartime munitions towards manufacturing the ships, lorries, clothes and chemicals that the post-war world demanded. She was just about to launch the world’s first jet airliner, and was on the verge of utilising nuclear energy for civilian purposes. Manchester University had been installed with the first commercially-produced computer, the Ferranti Mark 1, and was about to develop the first computer to use transistors instead of valves. And, 16 months after the Queen came to the throne, the world watched her coronation on British television sets made by the likes of Pye, Thorn, GEC, Philips and Rank – cutting-edge technology designed and built in Britain, bringing the pomp and circumstance into millions of homes. Britain, it seemed, would prosper as much from Churchill’s “golden age of science and machinery” as we had from the world’s first Industrial Revolution.

Sixty years on, as Nicholas Comfort says in this timely and significant book, the picture is unrecognisable. Entire sectors of British manufacturing have gone. Britain invented TV, but the world will not watch the events of the Diamond Jubilee this summer on British-made sets, as the last plant making them in this country closed in 2009. British TV manufacturers largely had their own way until the 1970s; inefficiency and complacency turned to astonishment in 1972, when they saw the colour sets with remote control manufactured by Japanese firms Sony and Toshiba, and on sale for less than £200. Pye sold out to Philips, who moved the manufacture of TVs to Singapore.

How on earth did British manufacturing retreat so far in the last 60 years? Why has Germany retained a Siemens and France an Alstom, but we haven’t kept anything similar? Comfort, who has reported on politics and industry since the 1960s, is experienced and well-placed to set out the reasons. He is too pessimistic on British manufacturing’s fall – we still have world-class firms in advanced manufacturing that should be at the cornerstone of a rebalanced economy – but his lament at the fact that Britain, once the workshop of the world, sees Germany outpace us in manufacturing and engineering is a fair one.

Comfort identifies throughout the 60 years a complacency and arrogance that a grateful world would always want British goods, regardless of markets or quality. A marked lack of investment undermined British competitiveness – as late as the 1970s, Sheffield engineering firms were still using machine tools taken from the Germans as reparations after the First World War, by which time Germany had re-equipped twice and seen productivity shoot up as a result. 

Management decisions didn’t help either. Arguably the most iconic British product of the post-war era, the Mini, was originally retailed at £500 to undercut the Ford Anglia, even though each car cost £535 to manufacture. As the five-millionth Mini rolled off the production line in the 1990s, it was estimated that each car had registered barely £5 profit. Time and again in the book we read that one such British firm or another had been “wrong-footed” by the foreign competition. 

Politicians are let off surprisingly easily. Comfort concludes that most British governments of the last 60 years have been held prisoner by events, and the frequent changes of government failed to instil any long-term stability in industrial policy. Although all post-war governments are to some degree culpable for manufacturing’s decline, it is really only the Thatcher government, with an emphasis on ideology, that earns Comfort’s true criticism. “If you were any good, you would be working somewhere else,” she once told the senior management of British Rail. Mrs Thatcher may have succeeded in defeating inflation, Comfort argues, but only at “the price of lasting damage to industry”.

Comfort is most critical of the culture and attitude of the Whitehall machine, which has tended to regard policy as an achievement in itself. The author concludes, dramatically: “The implementation and delivery of these policies is all too often viewed as a grubby if regrettably necessary exercise not worthy of men and women with Firsts in Classics.”

As a result, Britain has never attempted to create the close partnership between government, the banking industry and industry that exists in Germany. In the aftermath of the Second World War, Comfort argues, Britain was dismantling joint production committees, where management and shop stewards worked together to boost industrial output, thereby planting the seed for future industrial unrest and stalling productivity. Germany, ironically at Britain’s instigation, was putting in place precisely such structures that helped industrial stability in the post-war era. 

Despite his pessimism throughout the book, Comfort ends on a note of optimism – despite the last six decades, we still have world-beating sectors and companies with real competitive advantage. What is needed is an industrial policy, with active government and productive business working together to secure long-term stability and creating the right framework for industry to invest and thrive. These are precisely the points that Ed Miliband and Chuka Umunna have been making about intelligent government. Our future prosperity still depends on us makings things, and government has a role in making that happen.

Iain Wright is the Labour MP for Hartlepool