Why small towns are integral to the Northern Powerhouse if they recognise the greater good – Jim O’Neill

What will the Northern Powerhouse do for resorts like Scarborough?
What will the Northern Powerhouse do for resorts like Scarborough?
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I HAVE spent a lot of time in the past six years thinking about the excessive dependence of the UK economy on the performance of London and the surrounding South-East, originally being asked to chair an independent review into how to invigorate other major British cities.

This Cities Growth Commission appeared to be a big influence on the then-Chancellor of the Exchequer, George Osborne, and our ideas played quite a role in the conception of the Northern Powerhouse.

Jim O'Neill was one of the architects of the Northern Powerhouse.

Jim O'Neill was one of the architects of the Northern Powerhouse.

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In that Commission, and much of the subsequent focus of thinking of mine, the prime areas of attention were larger metropolitan areas of at least 500,000 residents. This was done not because we didn’t care about smaller cities, towns or rural areas, but simply because we were tasked with coming up with ideas that could boost national economic growth.

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The evidence strongly suggested that if you could boost the economic performance of these 14 metro areas while not weakening that of London and the South-East, the overall trend growth performance of the UK could be improved.

Will the Northern Powerhouse agenda benefit towns like Barnsley?

Will the Northern Powerhouse agenda benefit towns like Barnsley?

When thinking about smaller towns, villages and rural areas, it is the case that if all of them around all the UK could also see their general vibrancy uplifted, then this would also boost national economic performance, but there are thousands of these, and unless you can positively change a large majority of them, it likely wouldn’t influence the overall national economy.

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This observation is often not something many wish to focus on, but in my view, it is a harsh reality. If accepted, it would allow a more rational discussion of what to do about these smaller, so-called ‘left-behind’ places.

At the same time, what is similarly true, as evidenced by the 2016 EU referendum, is that even if you can’t think of policies to help all these smaller places that would make as much difference as policies for 14 metro areas, it is rather dangerous to not think about them.

In principle, towns that are commutable to London, or geographically lie within the Northern Powerhouse or the Midlands Engine, should play a crucial, indeed, central role.

The core of the Northern Powerhouse is the region that is bounded between the metro areas of Leeds, Sheffield to the east, Liverpool to the west, and Manchester, centrally. Including all the towns and villages in between as well as those cities, this totals around eight million people.

If policies can be done to allow this whole area to function as one economic unit, both as consumers and producers, then all the smaller towns would benefit immensely. Barnsley, Doncaster, Oldham, Warrington and so on, all stand to benefit just as much as Manchester itself, if done properly.

This is why, of course, the Northern Powerhouse Rail is so central to the concept. There is also the topic of young people from towns that, understandably want to disappear off to universities.

If the Northern Powerhouse develops credible traction, and young ambitious people feel they can develop a fulfilling and rewarding career, then some of these towns could become the Guildfords of the Northern Powerhouse in the future.

Similarly, the path of disappearing off to a university, then finding the first job in London, and then disappearing to London for the rest of one’s active life, can be broken. Indeed, I detect the faintest of signs that this might be happening a bit, at least around the Manchester and Leeds areas.

It is undoubtedly tougher for towns that are more remote, including those in the North. Many of these proud places, historically vibrant due to manufacturing industry or coastal tourism, need to take a good hard analytical look at themselves, and objectively articulate what is their modern ‘edge’? Feeling sorry for themselves because they have been on the wrong end of major global, and perhaps domestic, forces won’t really succeed.

Trying to position yourself in a different way is the right path. Carlisle I think, which is very isolated from the major urban centres of the North, has started to have some success. It has persuaded policy-makers to think of it as being in the centre of the ‘Borderlands’ area and has managed to attract government funding for some new ideas that go with this. Most recently, Stockport, long a town felt bypassed by Manchester’s success, has decided to become more ambitious and has some truly exciting ideas about recreating its central areas. I am sure there can be many others.

Lord O’Neill is the Vice Chair of the Northern Powerhouse Partnership, This article is from the Tory think-tank Bright Blue’s magazine Centre Write.