Outside Government, George Osborne can focus on the policies that will best promote prosperity across the North – boosting productivity in cities.
The Northern Powerhouse has been top of the news and policy agenda again in recent days, following the launch by George Osborne of the new Northern Powerhouse Partnership.
The establishment of the new body is a welcome reminder of the need to keep focusing on policies that will help to address what the former Chancellor describes as “100 years of rapid decline” in the North.
Of course, Osborne no longer has the levers of the state at his disposal, and some may question what impact and influence he can have as a backbench MP (albeit a very high profile one). However, his new status also affords the former Chancellor an opportunity to dedicate more time to exploring an even wider range of ideas and polices for the Northern Powerhouse.
While Chancellor, Osborne was under political pressure to adopt exactly the same approach to every place across the North. Over time, the Northern Powerhouse project moved away from its initial aims of strengthening the economies of major city regions in order to boost the whole of the North, to instead considering the North as one big region with common economic strengths and challenges.
A pan-Northern approach is clearly important for large-scale transport improvements or marketing investment opportunities across the wider region. But treating Bradford as if it has the same challenges as Burnley will not deliver on the ultimate aim of the Northern Powerhouse – raising prosperity and growth for people across the North.
As Osborne considers what next for the Northern Powerhouse, his new Partnership should focus on the policy ideas that will have the greatest impact in boosting jobs, wages and opportunities across the region – and this means recognising and making the most of the diverse economic roles and strengths that different places in the North offer.
Rather than spreading limited monies and political focus equally across the whole region, our research suggests that policy will achieve the highest levels of jobs and growth for the most people – living in rural and urban areas – if it focuses primarily on boosting productivity and skills in major Northern city-regions. Indeed, Greater Manchester and Leeds city region alone are responsible for more than a third of the North’s total economic output. Making the most of their potential – and particularly that of their city centres to attract high value, knowledge intensive, high paid jobs – will require investment in skills, housing and transport, to better link people to the opportunities that exist across city regions.
The Partnership should also consider what a successful North will look like in twenty years’ time. Osborne is right that the past century has brought economic decline across many places in the North. To reverse that trend, it is vital to analyse why that decline happened and consider what the region needs to do to adapt. Looking at the prevailing economic trends of the last twenty years, during which time Britain’s services sector drove most of the country’s economic growth – it is clear that the calls of some politicians to recreate the North’s glory days by focusing on a resurgence in manufacturing will not be sufficient to transform the North’s economy.
Recognising that different places in the North face different challenges – and that policy solutions must exploit the diverse strengths that different places and sectors offer – posed a tough political balance for Osborne to achieve while Chancellor. Now that he is no longer in high office, he must grasp the opportunity to advocate the ideas and interventions which will make the biggest difference to the largest number of people across all parts of the North.
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