Boris Johnson’s government was elected in 2019 on the pledge of ‘levelling up every part of the United Kingdom; not just by investing in our great towns and cities, as well as rural and coastal areas, but by giving them far more control of how that investment is made’.
Nearly three years on, income and socioeconomic inequality are on the rise across the UK as a result of the Coronavirus pandemic, meaning that regional disparities are an increasingly pressing issue to tackle. At the Peterloo Institute, we hope to gain some clarity over the Prime Minister’s levelling up agenda during this week’s Conservative party conference.
But what exactly is ‘levelling up’?
The slogan is not very clear and Conservative ministers have mentioned different aims to deliver levelling up policies. The Prime Minster has often referred to it as a set of policies that try to reduce the disparities caused by the UK’s turn to a globalised, service economy that left behind many towns and cities outside of Greater London. Most recently, during the Queen’s speech, Boris Johnson detailed his intention to ‘create new and good jobs, boost training and productivity in places that have seen economic decline and the loss of industry, through an approach that nurtures different types of economic growth and builds on the different strengths that different places have’.
So, why is it so important to ‘level up’?
The UK is officially recorded as one of the most unequal countries in Europe according to a wide range of factors. Paul Collier said that regional disparities have been driven by ‘a 40 year divergence in income, dignity, empowerment and finance between the metropolitan South East and other regions’, in a way that is much higher than in other European countries such as France, Spain, and Germany. In other words, the UK economy has long over-relied on London as a force of income and productivity, causing stark divides based on health, income, and skills between Greater London and the South East, and everywhere else.
What is clear about the levelling up agenda
1) Levelling up is not only about increasing economic outcomes.
According to the Plan for Growth, the PM’s levelling up speech, and the main policies mentioned so far, it is clear that ‘levelling up’ is about more than increasing the citizens’ incomes. The government hopes to address a range of things geared towards improving people’s everyday life across the country, such as health outcomes, educational opportunity, and safety.
1) Investment in infrastructure is high on the ‘levelling up’ agenda.
The government is also committed to enhancing infrastructure and making places more connected via investment in both transport and broadband. The Build Back Better plan published by the Treasury advocates for an economic approach that seeks to boost private investment and create high-quality jobs in all parts of the country as well as regenerate town centres and local public infrastructure via the Towns Fund.
What is not clear and what we demand more clarity on:
1) What is going to be the role of subnational governments? What extra-powers are they going to receive as part of the levelling up project? How are they going to work with the government to level up the UK?
Improving devolution is essential to reduce regional inequalities and create opportunities in all parts of the country. Currently, most political powers and funding mechanisms are concentrated in the centre, and sub-national institutions are ‘weak, fragmented, and subject to frequent “policy churn” by comparison’, as Andy Westwood points out. Granting more autonomy to local governments, councils, and local service providers is integral in delivering better public services and reducing regional inequality. As such, we expect that the Conservative party conference will provide a clearer picture on how the Government plans to reset the relationship between central and local governments.
2) How will the ‘levelling up’ fund be allocated?
Since inequalities are present at the micro-level too, even within an ‘overall’ wealthy area, the levelling up process needs to be capillary and the funding criteria must take into account local needs, down to individual neighbourhoods. Boris Johnson has often said that he hopes to create one globally competitive city in each region of the UK, suggesting that the greatest interventions in infrastructure, R&D, and human capital will most likely happen in urban areas, which, in turn, offer help to nearby areas. We believe that increasing the power and potential of regional cities outside of London is not enough to reduce disparities, and it may even generate further divides between urban and peripheral areas that are already sites of deprivation.
3) What are the Government’s social-security commitments to achieve a more balanced society?
Boris Johnson has stated repeatedly that the levelling up process and the parallel recovery from the pandemic, will be driven by ‘jobs not welfare’, because ‘[higher employment rates] will help the economy bounce back’. However, employment rates and social welfare policies are not mutually exclusive, as workers should not only have access to jobs, but also to secure living conditions. Insecure employment is, indeed, intertwined with different measures of socioeconomic inequality, as it contributes to financial stress, housing instability, poor health and wellbeing, and low chances of personal progression. We hope that the Government will bring light to its commitment to the protection of the UK work force as it plans to expand employment opportunities across the country.
To wrap up, much is still unclear as to what the Conservatives mean by ‘levelling up’ and most importantly, how they’re going to deliver it. If their White Paper will include policies geared towards expanding devolution, allocating funding evenly, and introducing robust social security measures, we will certainly be stepping in the right direction.
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