The view from the Northern Powerhouse 25/05/18

 

I was fortunate enough to attend the Brexit North summit in Leeds on Monday run by IPPR North and CityREDI, a research institute based at the University of Birmingham.

The day, unsurprisingly, focussed on Brexit, but most striking thing that I took away was the shocking statistics about the state of the UK economy which were shared by economist Prof. Philip McCann.

McCann stated that from the economic analysis point of view the UK is an outlier as a single country and instead the analysis of the UK makes sense if we view the UK as 3 different countries. The super-successful London and surrounding area in the South East, Scotland and the rest of the UK.

As a whole this means that, despite the overwhelming success of London as a global centre of business, the UK’s standing in the world economic rankings as a whole has only overtaken 1 country, New Zealand, in the past 30 years, whilst being lapped by many other developing economies.

This fragmentation of the UK economy has been in process since the 1970s when the UK was dubbed the ‘sick man of Europe’. And it goes without saying that whilst it’s true that this economic decline in most of the UK has taken place whilst we’ve been in the EU, the success of London and other areas, such as East Germany, where post-1990 many regions have been more productive than the North of England, shows that the two are not correlated.

In fact, in the whole of the Eurozone, productivity variations are no bigger than those within the UK.

We all know the UK is an unequal place, but snippets like this bring home that fact that clearly all has not been well.

And so we get to Brexit, which by and large the attendees and speakers on Monday were in broad agreement is not the solution to these problems, and cruelly for many of those so-called ‘left behind’ communities that are the reality behind the leave vote statistics, things are likely to be made worse unless something drastic is done.

The answer posed on Monday was that devolution of powers and resources away from Westminster and closer to communities is the only way to mitigate the potential negative effects of Brexit and improve opportunity and outcomes for those living outside of London. But with Westminster hesitant to give sufficient powers and resources away to even strong city region economies such as Manchester, it seems a long way before the North truly becomes in charge of its own destiny.

Read the full Northern Powerhouse round up here.

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