Future of the North: Is the Northern Powerhouse still the answer?

Future of the North: Is the Northern Powerhouse still the answer?

As a Northern developer we have a keen interest in how the regions are developing and what the future holds. Whether you look at Manchester, Leeds, Newcastle, Liverpool, Sheffield or Hull, it is clear that the fortune of individual places in the North is dependent on the success of all.

In the ninth article of this series, we take a look at how much of a success the government’s Northern Powerhouse scheme has been, whether it is still the answer for the future, and what might replace it if not.

Five years ago, the Northern Powerhouse project was launched by George Osborne, then-Chancellor of the Exchequer. The idea behind it was to boost the Northern regions and, as a consequence, reinvigorate the national economy by rebalancing it away from London. Funding was to be provided for infrastructure, housing and business development – but has it been a success?

A recent report from the Institute of Public Policy Research North (IPPR North) shows that the picture is mixed, with many positive aspects. Almost 35,000 professional, scientific and technical jobs have been created in the regions over the last five years – exactly the sort of employment which will be vital for the fourth industrial revolution which is underway. Overall, employment in the North has grown by 7% in the last five years, trending above the 6% average shared by the rest of the country.

Economic growth is also strong in the North, with the overall economy growing by 10.7% between 2014 and 2017, a figure higher than the national average over that time period. Broken down by individual regions, the North West was second only to London in this regard.

In addition, the creation of Transport for the North (TfN) is arguably the most important achievement so far. The first ever government body specifically for the North, TfN has been granted statutory powers and operates as the civil service of the Northern Powerhouse. So far it is clear that TfN is changing the national agenda by pushing hard for greater transport investment across the regions – something which could be a game changer. For instance, before TfN existed the poor state of rail links across the North never made a splash; now, it is national news and serious calls are being made for the rail franchises to be returned to public ownership.

However, despite the above progress we can’t ignore the fact that the government’s interest in certain aspects of the Northern Powerhouse project seems to have dissipated somewhat. Additionally, the IPPR North report notes that the government’s austerity programme has “undermined” the project. Luckily, the North is getting on with it anyway despite all the obstacles that are in its path.

A good example is the strides made in Greater Manchester since a measure of real devolution was granted to the region, including control over its health service. The election of Andy Burnham as regional mayor has created a focal point for significant transport, environmental and infrastructure initiatives that have put the region at the forefront of the Northern Powerhouse and shown the way forward for others. While there is no one-size-fits-all devolution package, Greater Manchester is demonstrating that taking back political power from Westminster is a good first step.

Similarly, Northern towns and cities can help themselves economically, as demonstrated by Preston which has adapted a revolutionary new model. The city institutions – such as the local council, the NHS, the police headquarters and the university – have committed to procuring goods and services locally wherever possible rather than relying on giant out-of-town national or international corporations. The city is using its purchasing power as leverage to encourage more ethical business practices and, at the same time, stimulate the local economy. This is the sort of thing that Northern towns and cities can do without any assistance, and many are getting on board.

The Northern Powerhouse has not been the roaring success that many hoped for and anticipated, but there are clear signs that the Northern regions are at the start of something exciting and there is so much potential in our towns and cities.

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