Levelling up or levelling down? Johnson's attempt to tackle regional inequality.
By Horace Choi
The North of England. For London elites like Boris Johnson, that almost seems like a whole different country altogether: just to name a few differences, they are poorer than the South, have a lower life expectancy, and watch rugby league instead of union. The gap has been widening for decades and for young Northerners, moving away from their hometowns may now be their best bet of living a successful life. However, Johnson also found himself on side with the North on one important issue: Brexit. A shrewd statesman, he swiftly identified the opportunity to crumble the ‘red wall’ - a swathe of formerly safe Labour seats in the North of England - with a pledge to ‘level up’ the region.
This project is propelled largely through public investment: a ‘towns fund’ has been set up with £3.6 billion to be distributed to local councils of 101 towns, which are picked by government ministers on account of how in need of regeneration they are - since most towns that fit this criteria are in the North, the towns fund is largely seen as part of the ‘levelling up’ agenda. Freeports, in which several taxes like tariffs are exempt, are also to be set up around England with the aim of encouraging regeneration; three of them are in the northern ‘red wall’ - Liverpool, Humber and Teesside. Moreover, institutions are encouraged to move north so that power is more balanced between London and the North: for example the Department for Transport, BBC and banks like HSBC all have plans to relocate significant numbers of jobs to Leeds, which is often perceived as the Northern financial centre.
Deprivation stems from a lack of investment, so the ‘levelling up’ agenda would definitely succeed in regenerating the North through public investment, in the most immediate sense. However, it is by no means a spotless project; there are hints of it being utilised by the Conservatives for political gains. For example Darwen and Newark, both nowhere near the 101 most deprived towns in England, both received subsidies through the towns fund. They also happened to be the constituencies of the ministers responsible for the towns fund, Jake Berry and Robert Jenrick respectively. The Freeport to be set up in Teesside also arguably has political motivations, as a method to secure Ben Houchen, the Conservative Tees Valley mayor’s popularity - he defeated Labour by 0.5 percentage points in 2017; in 2021 the gap had jumped to 46 percentage points. This suggests that the Conservatives may be encouraging more Northerners to vote for them, by creating a sense that having Tory representatives would bring more resources to the area.
Despite both having lower productivity than the North West and North East, regions such as Wales and the East Midlands are also receiving much less attention than the North. Again, critics argue that this is a sign of the ‘levelling up’ agenda being politicised. Wales, despite being filled with mining communities like the North, remain relatively safe as a Labour stronghold, perhaps because of Labour’s willingness to give Wales more autonomy, as shown in Blair’s devolution acts. The Midlands, on the other hand, are much more ethnically diverse than the North: see Leicester, which is often seen as the Indian capital of Britain. As a result, the pro-Brexit and anti-immigrant sentiments that link Northerners and Tories are nowhere as strong in the Midlands. Therefore, because the potential gains for the Conservatives in Wales and the Midlands are smaller than the North, they largely miss out on the ‘levelling up’ agenda.
Another criticism of these plans is the accusation of the government ‘levelling down’ the South rather than levelling up the North. The main issue with public investments is that extra investments to the North would otherwise have been invested in the South. The same effect can be reached without impacting investment in the South, if government schemes were to encourage private investments or stimulate the economy, instead of injecting directly. This is already having negative impacts for the Conservatives: their traditional Southern voter base is threatening to leave them, because their interests are being compromised in order to attract Northern voters. In the Chesham and Amersham by-election this June, the seat seen as solidly part of the ‘blue wall’ was ceded to the Liberal Democrats.
The ‘levelling up’ agenda is also seen as being a short-term fix. Through public investments, the plans contribute little in the way of improving productivity in the North. Although the Freeports aim to attract private investments, experts expect little more than tax evaders to emerge in those areas. On the contrary, financial support from the government may lead to towns relying on public funds which are largely collected from London and the South. This reliance is very difficult to shrug off, like all other kinds of subsidies, and may cause resentment between the North and the South.
Therefore, in 2030, I predict that even though the North will continue to be more prioritised and emphasised by the government than before, little real change would be brought about and the North will largely remain reliant on redistribution from the South. Tension between the two sides of England would also rise, which could lead to a political landscape where traditional heartlands, such as Labour in the working-class North, and Conservatives in the affluent South, are completely turned on their heads.
We could see a more equal England in 2030 if policies focus more on long-term change. For example, community wealth-building, a scheme pioneered by Preston City Council in North-West England, encourages local institutions like hospitals and universities to spend locally, and local firms to turn into co-operatives. This increases the money invested into the local economy and therefore stimulates development without the need to spend from the central government’s budget, meaning that it is much more sustainable than the current ‘levelling up’ agenda.
All of this, however, hinges on whether Boris Johnson and his wing of the Conservative Party holds on to power. What’s for sure is that Britain is embarking on a crucial decade.