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In June last year, the Prime Minister said he wanted to ‘build, build, build’ economy to level up. On the back of big promises in the manifesto in 2019 and a string of announcements towards the end of 2020, this blog looks at how 2021 is shaping up for metro mayors who want to help him out. A clear quid-pro-quo is emerging under which the government is prepared to support ‘levelling up’ investment within places that show leadership and take political risks.
London benefits from long-term capital grants controlled by the Mayor. This gives the mayor and TfL a stable level of funding to repair and upgrade the existing network, developing institutional capacity along the way (note: major projects like Crossrail still require funding agreed with central government). Now that other cities have metro mayors, they are also able to get on and make important improvements to the network and develop TfL-level capabilities.
The £4.2 billion five-year pot set out in the 2019 manifesto was confirmed in the National Infrastructure Strategy (NIS) published alongside the Spending Review in November. This will pick up where the £2.5 billion Transforming Cities Fund leaves off when it ends 2023 (and is in addition to the concurrent devolved 30-year Mayors Investment fund). Control will allow cities to focus on their own priorities over the long term. In Greater Manchester, it is supporting £1.5 billion investment in walking and cycling in over the next decade to reduce the £1.3 billion annual cost of congestion.
This is one clear example of ‘levelling up’ as promised. In 2021, look out for cities using the £50 million they have been allocated to develop their plans for this money.
Other big cities without metro mayors like Nottingham, Leicester and Southampton that are serious about upgrading their infrastructure need to start working now, in case the Devolution White Paper does not appear or disappoints, on their proposals to create metro mayors.
Ahead of the election, government made incredibly ambitious promises on regional and intercity rail infrastructure. Yet in December the NIC set out its Rail Needs Assessment, highlighting that most of these intercity schemes would likely require a much greater funding envelope than is sometimes suggested, while delivering limited benefits.
Look out for government pushing ahead with HS2 to Manchester while pausing Northern Powerhouse Rail and the Eastern Branch of HS2. This, alongside the creation of the Northern Transport Acceleration Council, raises questions about the future of Transport for the North in 2021.
Bailout negotiations between TfL and DfT led to funding for Crossrail 2 being stopped. This was justified in the NIS to ‘to free up investment in regional cities.’ Look out for whether London decides to take steps to fully fund this scheme solo, or whether it is left in the deep freeze as Crossrail 1 was for decades prior to 2005.
Changes to proposed measures for calculating housing targets meant 20 cities will be expected to deliver more housing through an “urban uplift”. London will see the highest uplift from 60,000 to 93,000 homes a year. The example of Tokyo shows that this is doable and likely to improve affordability and quality, but that it also require comprehensive reform to our planning system to remove its case-by-case decision making and rationing of land for development.
Look out for government pushing ahead with its Planning White Paper reforms after the local elections in May, so that new housing can take advantage of underused transport infrastructure. Sleepy suburbs that have seen little or no development despite access to rail or proximity to jobs to be awakened as zones for growth. Cities that want to get on board with the levelling up agenda should welcome change to our broken planning system.
While the Mayor of London has the powers to ensure all parts of Greater London contribute according to their ability and is held accountable by voters and the Government for housing outcomes in London, increases in other cities need reform. Voluntary, bottom-up, ‘speed-of-the-slowest’ city-region spatial plans such as in Greater Manchester or the West of England need to be levelled up to a London-style plan that is set by the mayor and does not allow local boroughs to opt out of growth and the political responsibility of urban governance.
Look out for reforms to give metro mayors similar strategic planning powers and responsibilities as the Mayor of London to avoid future failures holding back delivery of homes in our most important city economies.
Increases in urban housing supply will require improvements to urban transport systems. This will need more than just improvements to the ‘hardware’ of bigger roads and new trams or rail. Cities need a ‘software’ update for their transport systems to grow without growing pains. More homes without this update will generate extra congestion and worse air quality for existing residents and new. This means better buses, that can be delivered at a fraction of the cost of the huge £27.4 billion road investment strategy.
Co-ordinated and integrated bus services, with improvements to bus priority are needed. This is most effectively done through franchising.
Look out for Greater Manchester and Liverpool City Region’s decisions on whether to franchise their bus systems to improve not just their road networks, but also rail and light rail infrastructure. The expected National Bus Strategy is due soon, and if government wants its transport capital investments and housing aims to be delivered, alongside environmental, economic and air quality ambitions, it must come out unambiguously come out in favour of franchising as a means to ‘level up’ their transport software with London.
This year will mark the foundation of the National Infrastructure Bank (NIB), based in the North. Government will want cities to take advantage of the NIB and to generate revenues they have been so far reluctant to raise through introducing congestion charges, workplace parking levies or business rates supplements. If government is serious about cities using the NIB and funding more transport locally, then we should expect to see a commitment to match fund NIB loans with grants for cities that put more ‘skin in the game’ with local revenues.
Cities will be right to feel disappointed if funding for some of the biggest rail schemes are dropped in 2021. But they will have more power than in decades to take control of their cities’ networks in a way that only London has previously been able to. Look out for whether they take the concrete steps to take that chance, and government gets behind them.
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