What have decades of plans and the spending of billions of pounds to level up the UK’s economically lagging regions, including the North East, achieved?
Two answers to that questions were given last week. The more optimistic was that the results have been ‘disappointing’; the more pessimistic that the difference is ‘0%’.
The first, more optimistic, assessment came from Prime Minister Boris Johnson in his speech on levelling up:
‘This [levelling up] is a huge undertaking that many governments have debated about and dabbled in before and though there have been some successes the overall results are disappointing’, he said.
‘In the last 40 years’, added the Prime Minister, ‘we have had 40 different schemes or bodies to boost local or regional growth – we had the Abercrombie plan in London, the new towns, the economic development committees, the urban regeneration corporations, the new deal for communities, the regional development agencies. And yet none of these initiatives have been powerful enough to deal with the long-term secular trends – de-industrialisation or the decline of coastal resorts – and that basic half-heartedness has been coupled with an unspoken assumption by policy makers that investment should always follow success’.
Had he been thinking solely of the North East, the Prime Minister could have mentioned the following plans and reports: the Hailsham Plan (1963), Challenge of the Changing North (Northern Economic Planning Council – Dan Smith’s plan – 1966), Strategic Plan for the Northern Region (North Regional Strategy Team – 1977), (Unlocking Our Potential (One North East – 2001), Leading the Way (One North East – 2006), Newcastle in the North East of England (Organisation for Economic Cooperation and Development – 2006), North East Independent Economic Review (the Adonic report – 2013), More and Better Jobs (the North East Local Economic Partnership – 2014) and Tees Valley Strategic Economic Plan (Tees Valley Unlimited – 2014). He might have added Tees Valley: Opportunity Unlimited (the Heseltine Plan – 2016) – if he had not suspended Lord Heseltine from the Conservative Party over Brexit.
There was nothing fundamentally wrong with any of these plans. They all focused on the staples of economic development – infrastructure and transport, education and skills, employability, business support and innovation. But in spite of the billions spent, they all lacked one essential – adequate funding. They were, to use Johnson’s phrase, half-hearted.
The other assessment of the success of levelling up in past decades came in a report from the Institute for Community Studies (ICS): ‘Why Don’t they Ask Us? The role of communities in levelling up’. In its survey of economic development since the turn of the century, the ICS argues that local communities have largely been left out of the process:
‘We conclude’ it says, ‘that community involvement has been seriously undervalued as an approach to closing the gap in the relevance and effectiveness of local economic intervention. Ultimately, this report advocates for the value of community-engaged approaches to economic development and the importance of incorporating such approaches into current and future interventions.’
In its careful academic prose, so different from Johnson’s flamboyant oratory, the ICS states:
‘The trend at the heart of our analysis is a 0% average change in the relative economic deprivation of the most deprived local authority areas between 2004 – 2019. This means that local areas that started the era as the most deprived places in England are still in the bottom-ranking group today – and experiencing the greatest relative economic scarcity and stagnation fifteen years later’.
Note the use of the word ‘relative’. For it would be wrong to suggest that the decades of economic planning have done nothing for the North East. What they have failed to do is enable the region to catch up. The region’s position at or near the bottom of most league tables is relative to the rest of the country and does not reflect an absolute decline. The region has shared the nation’s increasing prosperity even while remaining at the bottom of the league (not to forget, of course, that there remain many people living in areas of multiple deprivation – itself a relative measure). What is more, some writers have suggested that as long as they have a decent job and standard of living, many people in the region would prefer to remain at their current level of relative prosperity if that allows them to retain the lifestyle they are used to and the community values they cherish rather than join a rat race for ever greater wealth. Yet other writers have suggested that each region should aim to fulfil its own potential rather than measure itself against others. All these issues are discussed in my thesis.
Exactly what the government means by levelling up remains unclear following Johnson’s speech; for further explanation we will probably have to await an expected White Paper in the autumn. There was one indication in the speech however:
‘When I became mayor [of London] in 2008 you could travel from Westminster to Canning Town on the jubilee line and lose a year of life expectancy with every stop, and yet at the end of my time as mayor that was no longer true. Life expectancy had increased across the capital – but the gains had been greatest among the poorest groups and that is what I mean by levelling up’.
This suggests two approaches to levelling up that may be in the Prime Minister’s mind. One is that levelling up is not just about economic metrics like jobs and productivity but also about wellbeing issues like health – though ultimately the nation’s ability to pay for health services and individuals’ ability to pay for healthy lifestyles depends on economic success.
The other indication that could be taken from this section of the speech is that levelling up is seen by the Prime Minister is not just about inequalities between regions – between the North East and the South East, for example – but between different places within the same region, between prosperous, leafy suburbs and deprived inner-cities or old coalfield communities, for example.