The politics of regional policy tends to sway from one
end of the spectrum to the other as opposition parties win and then lose
general elections. The 2010 general election, for example, saw a Conservative
‘localism’ agenda that promised to sweep away of Labour’s ‘centralising’
regional tier. The 2015 election promises to be a little less adversarial,
however, as a consensus appears to be forming around the north, around the
importance of cities, and around the importance of city regions.
Consider, for example, that the last few months has seen:
- Conservative Chancellor George Osborne’s ‘Northern Powerhouse’ speech in June, which ‘starts a conversation about serious devolution of powers and budgets for any city that wants to move to a new model of city government - and have an elected Mayor’;
- Labour peer Lord Adonis’ Review Mending the Fractured Economy: Smarter State, Better Jobs, which set out reform to empower city and county regions; and
- Liberal Democrat Deputy Prime Minister Nick Clegg’s launch of ‘Northern Futures’, a ‘call to arms for ideas on how to create a vibrant Northern hub so it can compete with the biggest cities around the world.’
We have also see recently a strategic proposition for
transport in the north, ‘One North’, led by the city regions of Leeds,
Liverpool, Manchester, Newcastle and Sheffield and the next few months promises
no let-up to this devolution frenzy.
In September, the Government’s chief scientific adviser,
Sir Mark Walport is expected to publish a new Science & Innovation Strategy.
In October, the chairman of HS2, Sir David Higgins, will
present updated plans for trans-Pennine HS3 railway links.
In November, as what is believed to be the centrepiece of
the Autumn Statement, the Chancellor will follow up his ‘Northern Powerhouse’
speech with plans to give towns and cities greater control over their budgets.
It is the extent to which control really will be handed over
that it is likely to provide some separation between the main political parties
in the run up to the election, but the direction of travel is a clear one and
the investment opportunities and benefits that this agenda present for the
property and construction in our cities, especially our northern cities, are
very exciting.
International evidence shows that investing in
infrastructure is essential to competing in the global economy and driving
economic growth. Yet, as the IPPR has pointed out, for a highly developed
country, the UK has underinvested in major infrastructure networks, and
according to the World Economic Forum, is slipping down the world rankings in
terms of infrastructure provision (WEF 2013). Further, investment spending is
out-of-balance. Treasury figures project London’s per capita publicly supported
infrastructure spending to be around £5,426 per resident. For the North West it
is £1,248 per resident, Yorkshire and the Humber is £581 per resident and the
North East is only £223 spent per resident (HMT 2014).
Treasury figures also show that the economy of the north
of England has grown by 3.9% a year over the past 18 years, which is lower than
the 4.4% achieved by the UK as a whole. If, as Jim O’Neill, Chairman of the
City Growth Commission, points out the northern growth rate could be raised to
the national level it would add some £56bn in nominal terms and £44bn in real
terms.
Politics and the pressure on the public purse will
ultimately define the commitment to the devolution agenda (it should be noted
that the new London Infrastructure Plan
2050 includes a £1.3 trillion shopping list…), but if the Government of whichever hue does commit to support the regions where
needed, and devolve powers and responsibility where possible, then the recovery
from recession could be longer and stronger than the continued clinging to the
coattails of London and the South East.
This piece was written for Construction Manager magazine.
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