You have to feel for Michael Gove. Rarely has a document been freighted with as much expectation as the levelling up white paper, which has been promised in one form or another since 2019. But even as the Department for Levelling Up, Housing and Communities was being given its new remit the spending shutters came down, ruling out new money – at least on the scale needed to radically alter hundreds of years of economic development.
Without new money the white paper sets direction rather than powering engines, though it does offer a few enticing hints of change. It promises, for example, to push devolution further and to bring some clarity and consistency to England’s idiosyncratic patchwork quilt of local government, and it celebrates the role of local policy-making. It even suggests that mayoral combined authorities and the Greater London Authority might bid for “sweeping further powers”, though it stops short of any significant transfer of fiscal powers.
And it does at least tell us what the government thinks “levelling up” is. At the core of the paper are 12 targets for 2030, heroically rebranded as “missions”. Advocates of mission-thinking as a way of galvanising action often point to John F Kennedy’s commitment to put a man on the moon by the end of the 1960s. Note that JFK didn’t make 11 other commitments at the same time. But most of these targets are laudable, even if the lack of detail on delivery makes them feel rather “aspirational”.
It is notable that most of them focus broadly on national improvements in social and economic conditions – job numbers, productivity and pay, violent crime, wellbeing, pride in place, school standards, adult training and home ownership – rather than explicitly on closing the gap between “LondonAndTheSouthEast” and other regions, which can of course be achieved by levelling up or by levelling down. Essentially the missions argue that all should rise together, though several qualify this by specifying that the worst-performing places should see the sharpest improvements.
Some targets are more explicit in their focus on narrowing gaps. Public transport across the country is to be “significantly closer to the standards of London” by 2030, which is a slightly ambivalent pledge given the cutbacks being considered by Transport for London in the absence of a long-term funding deal. It also does prompt a raised eyebrow – can other cities, let alone less densely populated towns, really support services like London’s?
The focus on narrowing the gap in healthy life expectancies also stands out, though the detail remains to be filled out in a separate white paper on health disparities later this year. In the meantime, the question of what geographies you use to judge success will be vital. As previously remarked here, the difference between places within the same borough can be every bit as stark as those between different regions.
There is a little more meat in the two economic missions. One pledges to improve pay, employment and productivity in every area of the UK – which should be good news for London, where productivity growth has stalled in recent years. The other proposes rebalancing public expenditure on research and development (R&D) outside the Greater South East. This could be one of the strongest measures in the white paper. Public spending on R&D is heavily focused on the “golden triangle” of London, Oxford and Cambridge, and there is a good argument that this concentration is failing on the grounds of economic efficiency as well as fairness.
Rebalancing investment to where it can make a real difference both directly and through attracting private investment rather than insisting it is spread evenly throughout the country, could make a real difference. The promise of £100 million for three new “innovation accelerators” in Greater Manchester, the West Midlands and Glasgow suggests that the need for focus is understood. Any switch of resources from London to other parts of the UK is likely to feel harsh, but a rebalancing of R&D spending is worth contemplating as a way of building up the knowledge economy in other cities.
Much less helpful is the white paper’s restatement of the government’s plan to divert funding for housing away from the areas of lowest housing affordability – that is, London and the South East. Doing so seems to fly in the face of its protestations that “levelling up is not about making every part of the UK the same, or pitting one part of the country against another. Nor does it mean dampening down the success of more prosperous areas”.
Less money for affordable housing in London is not likely to be good for London or the UK. London’s housing crisis is likely to worsen, with one of two results or a mix of them. Either the capital’s economy will suffer, with consequences for the rest of the country, or living in London will become more exclusive, further detaching the capital from the rest of the country. Investing to lever growth into other cities is a worthwhile endeavour. Removing support for infrastructure in places that most need it seems short-sighted and even spiteful.