Today
Sat 23 October 2021

Behind the gags, the Prime Minister’s plan for regional redistribution is woefully lacking, says Sam Bright

The Prime Minister delivered his Conservative Party Conference speech yesterday, conveyed in prose that appeared to fuse a newspaper column and an after-dinner speech – his natural professions.

A common theme throughout, and one that will likely carry the Conservatives into the next general election, was “levelling up” – ostensibly the effort to rebalance wealth and opportunities in the UK, primarily focusing on left-behind areas in the so-called ‘Red Wall’.

“The idea in a nutshell is that you will find talent, genius, flare, imagination, enthusiasm everywhere in this country, all of them evenly distributed, but opportunity is not,” Boris Johnson said.

The underlying conviction is a noble one. The economic dominance of London, and the wider south-east, has incubated vast economic equalities within and between different regions. According to Professor Philip McCann, a regional development specialist, the UK has the highest levels of regional inequality among the other 28 advanced OECD (Organisation for Economic Co-operation and Development) countries. “In many ways, the economic geography of the UK is reminiscent of a much poorer country at an earlier stage of economic development,” he says.

However, while Johnson’s intentions may be sound, the prospects of left-behind towns – and the Prime Minister’s own political prospects – will not be enhanced by his stand-up routine. The UK’s regional inequalities are all-pervasive, and Johnson will not be able to solve the problem simply with bravado.

So far, even among Conservatives, there has been an overwhelming sense of disappointment following Johnson’s speech. “No policy in the whole speech. Nothing of substance. Plenty of untruths. Will get written up as successful because that’s the world we live in,” wrote Sam Freedman, a former Department for Education advisor to Michael Gove.

The Adam Smith Institute – not commonly quoted on these pages – was even more scathing, calling the speech “bombastic but vacuous and economically illiterate”, adding that levelling up “so far consists of little more than listing regions and their local produce”.

Scrutiny of the policy has been relatively limited since its inception during the 2019 General Election campaign – a symptom of the Coronavirus pandemic, the media’s over-concentration in London and Westminster, and the longstanding apathy among those in power towards regional inequality.

However, there are three unambiguous signs that Johnson is not serious about the agenda.


Funding

The Centre for Cities has recently estimated that ‘levelling up’ will require an investment of £2 trillion from the Government – double its total annual expenditure.

This figure is based on the amount of money invested by the German federal Government following the unification of East and West Germany in the early 1990s. Germany was forced to amalgamate the richer, capitalist West with a bloc that had suffered from the privations of Soviet occupation. Even despite this, regional inequalities in the UK – in particular the economic divergence between London, the south-east and everywhere else – are now more more profound than the gap between East and West Germany.

Naturally, it is not possible for a trillion-pound investment programme to take place in just four or five years – especially given the economic pressures wrought by the pandemic. Regional unification has been a 30-year project for Germany, and the task is still incomplete.

However, the sums pledged by Johnson’s Government are paltry, by any measure. While it is expected that HS2 will cost in excess of £100 billion – an infrastructure project that many speculate will simply entrench London’s dominance – Johnson has pledged just£4.2 billion to fix local bus and train services.

Meanwhile, the Government’s flagship Levelling Up and Towns funds – designed to plough investment into more deprived parts of the country – amount to £4.8 billion and £3.6 billion respectively. Greater Manchester alone has asked for £1 billion from the Government in recent days, to invest in the area. For additional context, the Government spent roughly £15 billion on procuring personal protective equipment during the Coronavirus crisis, and has so far spent £20 billion on its ‘test, track and trace’ scheme.

What’s more, the Levelling Up and Towns funds have been plagued by accusations of political discrimination. In March, it was reported that 39 of the 45 places to receive a share of the first £1 billion in funding are represented by Conservative MPs. Notably, Chancellor Rishi Sunak’s relatively well-off constituency was placed in tier 1 of the levelling up fund, ahead of other, more deprived areas.


Devolution

A similar theme has emerged in relation to devolution – the distribution of state powers to nations and regions.

The Government has recently unveiled plans to change the voting system for English mayoral elections from the existing supplementary vote system – in which the public ranks their two favourite candidates – to the first-past-the-post system used in Westminster elections. Currently, Labour holds 11 of the 13 regional mayoral positions in England, and it is expected that reforming the voting system will make it more likely for Conservative candidates to be elected in future.

The evolution of the levelling up agenda – and the expansion of devolution – seem to rest on the Government’s white paper on levelling up (essentially a policy document that will set out proposals for future legislation), set to be released later this year.

The Conservative Party committed to “full devolution across England” in its 2019 Manifesto, though the precise details of this plan are yet to be released. In particular, criticism has been mounting for years over the current nature of regional devolution in England – via city-region mayors – given their relative lack of powers. It is unclear how the Government will ensure that local areas have a meaningful say on the levelling up agenda, or whether jurisdiction will remain in Whitehall.

The Conservative Party’s rhetorical commitment to devolution and regional rebalancing also hasn’t been matched by its actions since 2010, namely its decision to cut the local government budget in England by more than half from 2009/10 to 2015/16.

These cuts were particularly acute in Labour areas, and in some of the Red Wall seats won by the Conservatives in 2019. Of the 50 councils worst hit by austerity, 28 were Labour-run in 2010. Overall, Labour councils saw their spending power reduced by 34%, while the average Conservative council suffered an equivalent decline of 24%. The average council in the north-east of England also suffered a spending cut by 34%, significantly more than the average council in the south-west or the south-east of England.


Parliament

A man with an aptitude for wordplay and an allergy to detail, Boris Johnson is an effective political exponent of slogans and symbolism.

Yet, he has shirked the one symbolic gesture that may actually have a material impact on regional inequality: the location of Parliament.

Indeed, all staff currently based in the Houses of Parliament are set to move out by 2025 for a six-year period – allowing the rat-infested corridors of power to be renovated, at an estimated cost of between £12 billion and £20 billion (markedly more than the levelling up budgets).

The House of Commons will consequently decamp to Richmond House, a Government building just a short walk away from the Palace along Whitehall, while the House of Lords will sit in the QEII Centre adjacent to Westminster Abbey.

The renovation of Parliament provides a perfect opportunity for the locus of political power in Britain to be redistributed away from London – either on a temporary or a permanent basis – invariably dragging civil servants, journalists and businesses away from the all-consuming capital.

Johnson’s administration had previously planted rumours suggesting that the Lords could be shipped to York. In August 2020, the body in charge of Parliament’s restoration said that moving the Lords out of Westminster was a matter for MPs and peers. However, after the decision was delegated to parliamentarians, the BBC reported that a temporary relocation had been “effectively axed” – meaning that it didn’t carry enough support among the largest party in the House of Commons, the Conservative Party.

If the political system isn’t willing to detach itself from London’s elite districts, it surely isn’t truly invested in the economy at large dispersing to long-neglected regions.

Sam Bright’s book, Fortress London: Why we need to save the country from its capital, will be published in April 2022

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