Farewell levelling up – we barely knew you

By Ben Franklin | 13 May 2024

Labour has announced they are ditching the term levelling up. This is hardly surprising – it was a last-minute Tory construct as they sought to offer rhetoric in their manifesto to appeal to the so-called Red Wall after Brexit.

Delivering the project was kicked off by Boris Johnson’s chaotic Government, culminating in a massive White Paper which was so broad in scope and unfocused it was hard to understand what the Government was actually seeking to achieve. But ultimately what killed levelling up was not Labour, but the Tories themselves for failing to put any real resource behind it – the chancellor never backed it – and multiple small, fragmented funding pots were the only tangible legacy.

As Michael Marmot’s team showed last week, the reality over the last decade has been the opposite of levelling up – local authorities with the lowest life expectancy have seen the highest spending cuts, driving further increases in health inequalities between places.

But while Labour are killing the term, the mission to reduce regional and spatial inequalities will remain fundamental to the central mission of ‘growth, growth, growth’ after the next election and to securing a decade of national renewal. Centre for Progressive Policy research has shown that by reducing inequalities in health, skills and gender inequalities in the labour force we could boost national economic output by 7%.

Centre for Cities and others have shown how there are substantial productivity gains to be made by supporting our cities and regions to catch up with European equivalents, while we have also revealed the gains to be made by supporting pockets of high value-add sectors in underperforming towns across the country.

As Annabel Smith and I argued in The MJ last week, Labour’s paper Power up Britain picks up the mantle. It speaks to the failure of levelling up and starts to chart a new course to tackle such endemic inequalities. To start making a dent on this agenda, Labour has committed to further devolution to combined authorities, ‘muscular’ industrial strategy to harness promising place-based economic clusters and an end to begging bowl-style fragmented funding pots.

So far, so good – but we’ve been here before. Every major government and opposition in my living memory has promised to rebalance our skewed national economy and every one has failed to make a substantial difference. There have been a few successes – think Labour’s health inequalities strategy which helped to slightly reduce inequalities in life expectancy between places, regional development agencies which were starting to make a difference just before they were abolished, or Michael Gove and the Department for Levelling Up, Housing and Communities’ commitment to mayoral combined authority-level deals which has seen real power transferred to Greater Manchester and the West Midlands. There is evidence that devolution to the former may have helped improve health outcomes in the poorest parts of the region.

To state the obvious, these examples show how success can only be achieved through sustained reform and investment. Smarter public services that respond to regional and local needs are of course important, but progress critically depends on more money for infrastructure, education and skills which is clearly targeted based on need and opportunity.

The ultimate test, as the Government’s failed levelling up project showed, is whether the chancellor and Treasury coffers are behind it. Ultimately, this will mean higher taxes or more national debt in order to afford it – something neither party has been entirely honest about to date. But if we fail to guarantee more investment, we will be back here again in 10 years’ time with London still streaks ahead of the other regions and our second cities lagging behind their central and eastern European counterparts.

Ben Franklin is interim CEO at the Centre for Progressive Policy

@CentreProPolicy

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