Is Cameron a two nation PM?

Yet, as the next election approaches, there are three sound reasons why the Prime Minister must take today’s analysis on board. First, there are many Labour council leaders – like Keith Wakefield in Leeds – who are looking for innovative ways to deliver more services with fewer resources.

Second, evidence suggests that Britain’s recovery is London-centric. Whether it be house prices, transport spending or the allocation of council finances, it is hard to for Mr Cameron to claim to be a “one nation” leader when the North-South divide is evident in so many pronouncements.

Third, this failure to recognise the full potential of Yorkshire – and the North – totally contradicts the message that Mr Cameron delivered in Shipley in May 2010, the very first economic speech of his premiership. He told delegates then: “We will help to rebalance our economy, ensuring that success and prosperity are spread more evenly across regions and industries.”

The Conservative leader will point to HS2, and research by accountants KPMG which suggests that high-speed rail could be worth £1.9bn a year to the Yorkshire economy, but the benefits will not be felt for at least two decades – and that is assuming the plan is not delayed by objectors.

In contrast to his immediate predecessor Michael Howard, Mr Cameron did acknowledge in 2005 that the Tories needed to do far more to reconnect with the North after a decade of neglect.

Yet, while the Conservatives did make electoral gains 
in 2010, they were not sufficient to deliver Mr Cameron a working majority – and it is difficult to see how the party will gain an outright victory in 2015 unless it wins a swathe of marginals along the M62 corridor.

In short, there is a danger that “two nation” policies will return to haunt the supposedly “one nation” PM unless David Cameron puts in place policies and frameworks which target those communities still waiting for a new economic dawn. In short, it means 
a far fairer deal for Yorkshire than the coalition is delivering at present.

Food for thought

THERE’S more food for thought for David Cameron from the latest financial results published by Bradford-based supermarket giant Morrisons which blamed a decline in underlying sales on the continuing squeeze on household finances.

A day after Asda chief executive Andy Clarke predicted five more years of economic pain and called on the Treasury to lift the income tax threshold beyond the planned £10,000 next April to £12,875, the Government’s triumphalism over better-than-expected growth figures must not deflect attention away from the cost of living crisis being faced by many.

In many respects, supermarkets are immune from this – they know that people have to buy food and they can use competitive prices and offers to attract new customers. As such, a 1.6 per cent decline in sales will not make a significant difference to the fortunes of Morrisons.

However it is Mr Clarke’s assertion that the average UK household is paying £2,808 a year more on essential items, in comparison to five years ago, that will be particularly unappetising to the Tory high command when Mr Cameron studies the next set of opinion polls.

Given that many of these households have seen their income levels fail to keep pace with inflation, or even stagnate, it is little wonder that their optimism does not match the growing confidence of the business sector per se.

As the cost of motoring reaches a new high, and as homeowners brace themselves for another above-inflation increase to their domestic fuel charges, many will ask – and with good reason – what happened to Tory promises prior to the 2010 election to curb these increases.

Delivering change

SOME will find it ironic that the Government is pressing ahead with Royal Mail’s sell-off when Margaret Thatcher shied away from this challenge – even though she did not hesitate to privatise the main utility companies.

Yet today’s postal industry is very different to the 1980s when it enjoyed near monopoly status. Now it faces a very real threat from all electronic forms of communication, and the emergence of private courier firms who are delivering those bulk items now ordered online.

In this regard, the Royal Mail cannot afford to stand still. Despite its return to profitability, its business model needs to continue evolving to meet these new challenges that could not have been foreseen three decades ago – and the Government’s plans offers scope to attract much-needed investment.

The challenge is making sure that there are sufficient safeguards in place to protect the interests of consumers, the post office network and that postage is still affordable to all. Given this, Ministers need to be far more effective in articulating the case for reform than they have been with HS2.