Tens years on from the inception of the Northern Powerhouse, the devolution genie is out of the bottle - Henri Murison
It let the devolution-genie out of its bottle – something that will never, in my judgement, be put back (despite some setbacks along the way). At Labour’s manifesto launch in Manchester a few weeks ago, the party’s metro mayors were sat in the front row to Keir Starmer’s right – as sure a sign as any that local power is now front and centre.
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Hide AdIt was nearby in the Power Hall of the Museum of Science and Industry where Osborne laid out an economic vision which was deliberately designed to be cross party. In fact, Labour local government leaders from both sides of the Pennines were in the room to hear it.
The plan was based on the verdict of the Cities Growth Commission, led by renowned economist Lord Jim O’Neill: that by bringing together the cities of the North into a single integrated labour market, the sum could be greater than its parts. Not a rival to London but a counterweight, one that could attract more businesses, more investment, more jobs.
Osborne established organisations such as the Royce Institute and supported start-up ecosystems to turbocharge the North’s innovation potential, maximising the impact of our world-leading universities and research facilities. He also recognised the importance of culture to help transform our cities.
And, of course, a powerhouse needs power.
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Hide AdThis is where we have made the most progress. Nine in ten Northerners are now represented by a metro mayor, with Yorkshire to achieve 100 per cent devolution next year when Hull and East Riding elects its first Metro Mayor in May.
This means that the next Prime Minister, whoever that might be, will have to work with increasingly powerful figures who have a direct mandate from voters.
Empowered local leaders with knowledge, vision and capacity are needed to tie disparate strands of policy together in a cohesive effort to raise productivity. Devolution can have a genuinely transformative effect on local economies, whether by improving transport links, or bringing in investment from around the world.
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Hide AdAs well as extending devolution more widely across the country, we also need to deepen it. The Labour manifesto has committed to continue the work begun by Osborne and, more recently, Michael Gove, to drive higher growth by handing more key economic levers to those best-placed to join the dots at a local level.
You may be thinking this sounds all very positive. However, there is still a lot left to do.
Chronic underinvestment has contributed to the UK’s mammoth productivity divide, which has in turn driven an £8,000 wage gap between London and the North.
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Hide AdIf you want a single, deep labour market across the North then you need the transport - particularly rail infrastructure - to link it together. This is crucial to allow people to commute more easily across our unique economic geography, especially the short distances between Liverpool, Manchester, Leeds, Sheffield, Newcastle and the places in between, including Manchester Airport.
Despite the Conservatives’ pledge to deliver Northern Powerhouse Rail in their 2019 manifesto, we are still nowhere near close to starting to build the new lines we need. The dithering means it will also take longer to build the new station needed in Bradford and to electrify the line to Hull.
And what about Levelling Up? Despite the diligent work of white paper author Andy Haldane and many others, it has ended up more soundbite than substance. The Shared Prosperity Fund – intended to be a key levelling up funding stream - ended up being worth millions less than the European Union structural funds it replaced.
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Hide AdMeanwhile, the Levelling Up Fund has been criticised by the National Audit Office and many others for its slow and wasteful bidding processes. By handing out money to maximise political credit for Conservative MPs, the Treasury ended up inadvertently delaying the spending for so long that little has been spent - never mind had any impact.There have been numerous attempts to direct money to places in marginal seats, but that is completely unrelated to securing long term economic and social change. The difference with the Northern Powerhouse was the resolute focus on making this a cross-party, place-led project. Electoral considerations were secondary to long-term prosperity, even when it meant ceding powers and funding to political opponents.
This is a marked contrast to Osborne’s successors around the cabinet table, with the notable exceptions of Michael Gove on devolution and Greg Clark on local industrial strategies (before Kwasi Kwarteng dropped them).
Nevertheless George Osborne’s legacy in the North has been the standout success of the metro mayors - who are now here to stay - uniting local Labour leaders with a Coalition then Conservative-backed agenda along the way.
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Hide AdLabour is now picking up that mantle. Sue Gray, Whitehall insider and Keir Starmer’s Chief of Staff, has shown her own support for the agenda with regular meetings with the metro mayors and her alongside the wider Labour leadership.
If, as polls predict, Labour wins the election and, if they remain consistent to the devolution, local industrial policy and transport policies they have laid out, we will have ambition on this agenda once again.
This could mean the beginning of the end for our regional divides and, I hope, the next leg of the journey to a genuinely more productive, more prosperous North.
Henri Murison is chief executive of the Northern Powerhouse Partnership.
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