I’m often asked what the difference is between levelling up and the Northern Powerhouse.
Of course, while the party in power in Westminster has remained the same, the slogan has changed and the people in charge have changed - but the real difference is the level and seriousness of their ambition.
The original Northern Powerhouse project was a long-term strategy to fundamentally transform the Northern economy, by transferring power through devolution to places and on specific issues such as transport across the North. We focused on such priorities as better rail infrastructure, improving education outcomes and building a more highly-skilled workforce.
There were no quick fixes and the process would take decades – but slowly and surely, our productivity would rise and we’d contribute more to the UK economy with more high-quality, well-paid jobs for Northern workers.
It was an ambitious vision but a necessary one – we could no longer keep on paying the costs of economic failure.
By contrast, ‘levelling up’ has tended to focus on beauty pageants, bidding competitions between councils and piecemeal, superficial attempts to tart up town centres – and the Levelling Up Fund is a case in point.
Places across the UK were invited to bid for grants and, last week, we found out who had been successful for the second round of funding (worth a total £2.1bn).
I had mixed feelings. It was great to see some brilliant Northern projects secure funding, particularly Eden North in Morecambe Bay and the Sage convention centre and regeneration scheme in Gateshead. That money will make a meaningful difference to those particular parts of the North, creating jobs and unlocking further private investment.
However, there were hundreds of highly deserving places which lost out. Bradford and Leeds missed out this time. South Tyneside and Halton, two of the most deprived parts of the country, have received nothing in either round.
Meanwhile, 10 of the most prosperous councils in England got funding in both rounds. Only one of these 10, Richmondshire (the Prime Minister’s constituency), is here in the North - and if Rutland deserves it for Melton Mowbray, it makes no sense to leave poorer areas out in the cold.
These may be very worthwhile interventions, such as in Catterick, but this largesse has been paid for while passing over some of the poorest parts of the country.
I don’t begrudge any community that will benefit, but it’s a bitter pill to swallow to see some of the most disadvantaged parts of the country lose out as a result. As one Yorkshire business leader told me, it means we’ll ‘end up with a patchwork of interventions up and down the country rather than a co-ordinated response to longer term need’.
It’s been a frustrating, time-consuming and expensive process, with councils in England spending at least £27m. Much of this work ended up going down the drain – meaning that many local authorities are in a worse position than they were in the first place.
Moreover, as this whole process has dragged on so long, inflationary pressures mean that the lucky bids that did win will get a much smaller bang for their buck.
Proper devolution of this funding pot to Metro Mayors and local leaders in the first place would have been far less wasteful of resources and far more effective at tackling barriers to productivity.
‘Whitehall's bidding and begging bowl culture is broken, and the sooner we can decentralise and move to proper fiscal devolution the better,’ said Conservative Mayor for the West Midlands Andy Street, in a strongly-worded statement.
He’s absolutely right. We will be taking a closer look at fiscal devolution in the coming months - the benefits and the challenges - to see how we can reach a point where places are not reliant on Treasury.
With Michael Gove back at the helm of the Department for Levelling Up, Housing and Communities, I remain optimistic that we can get the mission to rebalance the UK economy back on track – especially now that both parties have declared themselves to be ardently pro-devolution.
However, Boris Johnson-style boosterism, motivated by politics not economics, will not drive real change.
Unless the Prime Minister changes course with the next Levelling Up Fund round, he is at risk of falling into the same trap as his old boss. Let’s hope he chooses substance over style.
Henri Murison is chief executive of the Northern Powerhouse Partnership
@NP_Partnership
