Government unveils levelling up plan to transform UK

Michael Gove to unveil the Government’s flagship Levelling Up White Paper, setting out a plan to transform the UK by spreading opportunity and prosperity to all parts of it.

News in brief:

• Twelve levelling up missions, given status in law, will shift government focus and resources to Britain’s forgotten communities throughout 2020s
• Shift of power from Whitehall to local leaders – every part of England to get ‘London style’ powers and mayor if they wish to
• Levelling up to take ten years
• Domestic public investment in Research & Development to increase by at least 40% across the North, Midlands, South West, Scotland, Wales, and Northern Ireland

The Levelling Up Secretary, Michael Gove will later today unveil the Government’s flagship Levelling Up White Paper. This document will set out a plan to transform the UK by spreading opportunity and prosperity to all parts of it.

Speaking to BBC Breakfast this morning Mr Gove said the plan is “going to make communities more equal, we want to make sure overlooked areas receive more money and more power.”

Outlining 12 missions, including the redistribution of research and development money around the UK and a focus on health, education and housing, he said “Brexit was a wake-up call to change the economic model of this country.”

System change and missions:

The White Paper will set out a complete ‘system change’ of how government works that will be implemented to level up the UK.

At the heart of this new way of making and implementing policy will be 12 bold, quantifiable national missions – to be achieved by 2030. These missions are the policy objectives for levelling up and form the heart of the Government’s agenda for the 2020s. They will be given status in law in a flagship Levelling Up and Regeneration Bill.

The Government intends these missions to be cross-government, cross-society efforts. The first mission, for instance, will see pay, employment, and productivity grow everywhere, and the disparities between the top and worst performing areas narrow. This is the first time a government has placed narrowing spatial economic disparities at the heart of its agenda.

The 12 Missions to Level Up the UK

By 2030:

1. Pay, employment and productivity will have risen in every area of the UK, with each containing a globally competitive city, with the gap between the top performing and other areas closing.

2. Domestic public investment in Research & Development outside the Greater South East will increase by at least 40% and at least one third over the Spending Review period, with that additional government funding seeking to leverage at least twice as much private sector investment over the long term to stimulate innovation and productivity growth.

3. Local public transport connectivity across the country will be significantly closer to the standards of London, with improved services, simpler fares and integrated ticketing.

4. The UK will have nationwide gigabit-capable broadband and 4G coverage, with 5G coverage for the majority of the population.

5. The number of primary school children achieving the expected standard in reading, writing and maths will have significantly increased. In England, this will mean 90% of children will achieve the expected standard, and the percentage of children meeting the expected standard in the worst performing areas will have increased by over a third.

6. The number of people successfully completing high-quality skills training will have significantly increased in every area of the UK. In England, this will lead to 200,000 more people successfully completing high-quality skills training annually, driven by 80,000 more people completing courses in the lowest skilled areas.

7. The gap in Healthy Life Expectancy (HLE) between local areas where it is highest and lowest will have narrowed, and by 2035 HLE will rise by 5 years.

8. Well-being will have improved in every area of the UK, with the gap between top performing and other areas closing.

9. Pride in place, such as people’s satisfaction with their town centre and engagement in local culture and community, will have risen in every area of the UK, with the gap between the top performing and other areas closing.

10. Renters will have a secure path to ownership with the number of first-time buyers increasing in all areas; and the Government’s ambition is for the number of non-decent rented homes to have fallen by 50%, with the biggest improvements in the lowest performing areas.

11. Homicide, serious violence, and neighbourhood crime will have fallen, focused on the worst-affected areas.

12. Every part of England that wants one will have a devolution deal with powers at or approaching the highest level of devolution and a simplified, long-term funding settlement.

The Research & Development (R&D) mission will see domestic public R&D investment outside the Greater South East increase by at least 40% by 2030, with these funds leveraging a huge increase in private investment in these areas too.

By 2030, other missions will see:

• the rest of the country’s local public transport systems becoming much closer to London standards
• the large majority of the country gain access to 5G broadband
• illiteracy and innumeracy in primary school leavers effectively eliminated – focussing the Government’s education efforts on the most disadvantaged parts of the country

Other missions will see hundreds of thousands more people completing high quality skills training every year, gross disparities in healthy life expectancy narrowed, the number of poor-quality rented homes halved, the most run-down town centres and communities across the country rejuvenated, a significant decrease in serious crime in the most blighted areas, and every part of England getting a ‘London-style’ devolution deal if they wish to.

Government record under scrutiny:

The Government has come under increased pressure on their record. Whilst Mr Gove has said all regional authorities that have bid for bus money will get the money they need, a letter sent to Local Transport Authority directors by the Department for Transport on January 11, was said to reveal that the budget for the ‘transformation’ of buses has shrunk from £3 billion to £1.4bn for the next three years.

The Department for Transport said that bus improvement plans would improve critical transport links.

On the delay of the target to rollout gigabit broadband to homes across the country by 2025 to 2030, Mr Gove was quick to point out that there are two different targets and it is important to recognise that isolated communities in England, Wales and Scotland that have particular issues.

Accountability:

The Government says that the missions will be underpinned by a suite of public metrics to track progress and monitor the evolution of spatial disparities. The Government will legislate such that it has a statutory duty to publish an annual report updating the public on the progress of these missions, with a new Levelling Up Advisory Council including members such as Sir Paul Collier, renowned economist at Oxford’s Blavatnik’s School of Government, providing further support and constructive analysis.

Other parts of the ‘system change’ include: all policy across Whitehall being aligned with the levelling up agenda and therefore subject to spatial analysis and a transformation of the Government’s approach to data and evaluation – with a new independent body created to improve transparency of local government performance.

The UK Government has committed to work with the devolved governments to achieve the ambitions.

Commenting on the announcement today, Levelling Up Secretary, Michael Gove said: “The United Kingdom is an unparalleled success story. We have one of the world’s biggest and most dynamic economies. Ours is the world’s most spoken language. We have produced more Nobel Prize winners than any country other than America.

“But not everyone shares equally in the UK’s success. For decades, too many communities have been overlooked and undervalued. As some areas have flourished, others have been left in a cycle of decline. The UK has been like a jet firing on only one engine.

“Levelling Up and this White Paper is about ending this historic injustice and calling time on the postcode lottery.

“This will not be an easy task, and it won’t happen overnight, but our 12 new national levelling up missions will drive real change in towns and cities across the UK, so that where you live will no longer determine how far you can go.”

The Prime Minister, Boris Johnson said: “From day one, the defining mission of this government has been to level up this country, to break the link between geography and destiny so that no matter where you live you have access to the same opportunities.

“The challenges we face have been embedded over generations and cannot be dug out overnight, but this White Paper is the next crucial step.

“It is a vision for the future that will see public spending on R&D increased in every part of the country; transport connectivity improving; faster broadband in every community; life expectancies rising; violent crime falling; schools improving; and private sector investment being unleashed.

“It is the most comprehensive, ambitious plan of its kind that this country has ever seen and it will ensure that the Government continues to rise to the challenge and deliver for the people of the UK.”

Shifting power from Whitehall to local leaders:

In an admission, the Government has recognised that it needs to build consensus, otherwise levelling-up will fail. Given the Secretary of State’s reputation for radical reform and reorganisations, as seen at the Department for Education and the Department for Environment, the White Paper will detail significant reforms to local and regional government – some saying the largest devolution of power from Whitehall to local leaders across England in modern times.

Citing strong local mayors like Andy Street, Ben Houchen and Andy Burnham, the Government wishes to replicate this success across England. By 2030, every part of England that wishes to have a ‘London-style’ devolution deal will have one.

A new model for England with more mayors for those areas that want one will be outlined in the White Paper.

The Government will invite the first nine areas to agree new county deals and seek to agree further Mayoral Combined Authority (MCA) deals, extending devolution across England. The first nine areas invited to begin negotiations will be Cornwall, Derbyshire & Derby, Devon, Plymouth and Torbay, Durham, Hull & East Yorkshire, Leicestershire, Norfolk, Nottinghamshire & Nottingham, and Suffolk.

The White Paper will announce negotiations for a new MCA deal for York and North Yorkshire and expanded MCA deal for the North East, as well as negotiations for ‘trailblazer’ devolution deals with the West Midlands and Greater Manchester to extend their powers – with these deals acting as blueprints for other MCA to follow.

The local devolution mission is relevant in England only, but the wider policy programme will see decentralisation of the UK Shared Prosperity Fund to local areas in Scotland and Wales.

In addition to the policies announced above, such as offering a ‘London-style’ devolution settlement to every part of England:

• Announcing for the first time a new devolution framework which sets out a clear menu of options for places in England that wish to unlock the benefits of devolution, whether that is moving towards a London-style transport system to connect people to opportunity, improving local skills provision, or being able to act more flexibly and innovatively to respond to local need.
• The £2.6 billion UK Shared Prosperity Fund will be decentralised to local leaders as far as possible, with investments set to regenerate communities, boost people’s skills, and support local businesses.
• A commitment to vastly simplify the local growth funding landscape to allow local leaders to drive tangible, visible change in their communities

No new money:

Labour said the plans contained no new money and little fresh thinking.

Setting out their own five-point plan for levelling up, including better broadband for towns and villages, action to tackle anti-social behaviour in city centres, and more affordable housing, Shadow Levelling-up Secretary, Lisa Nandy said: “Ministers have had two-and-a-half years to get this right and all we’ve been given is more slogans and strategies, with few new ideas.”

Defending the limited spending commitments, Mr Gove highlighted the £4.8 billion levelling-up fund of which the Government has already spent £1.7 billion. This is money allocated in the spending review and he expects new money to be announced in further spending reviews through the rest of the decade.

Some in industry have welcomed the announcement. Stephen Phipson, Chief Executive of Make UK, said: “Manufacturers will enthusiastically embrace this strategy which is a vital building block in spreading growth to all parts of the UK. The sector has a significant presence in exactly the areas which need levelling up and is playing a vital role in delivering high value skills. While there is substantially more to be done, this focus on skills and innovation, together with an emphasis on infrastructure and place, is the right starting point and one that industry will back.”

White Paper highlights:

The White Paper represents a long-term plan to transform the UK, but it also sets out the first steps the government is taking to achieve this.

Boosting pay and productivity, especially in places where they are lagging:

• To contribute towards domestic public investment in R&D outside the Greater South East increasing by at least 40% by 2030, the Department for Business, Energy, and Industrial Strategy (BEIS) has committed to invest at least 55% of their domestic R&D funding outside the Greater South East by 2024/5. Commitments to increase public investment have been made by DHSC, MOD, DfT and Defra. For instance, the Department for Health and Social Care will be increasing their medical research investment outside London, Oxford and Cambridge.
• The White Paper also announces three new Innovation Accelerators, major place-based centres of innovation, centred on Greater Manchester, the West Midlands, and Glasgow-City Region. These clusters of innovation will see local businesses and researchers in these areas backed by £100 million of new government funding to turbo-charge local growth, learning from the MIT-Greater Boston and Stanford-Silicon Valley models.
• The document further sets out the Government’s intention to mobilise £16 billion of the Local Government Pension Scheme for investments in local projects – recognising that too much at present is invested outside the UK.
• The government will fund ambitious plans for bus improvements in areas where this can make the most impact, including the mayoral city-regions, Stoke-on-Trent, Derbyshire and Warrington.

Spreading opportunities and improving public services, especially where they are weakest:

• 55 Education Investment Areas (EIAs) will be designated in local authorities in England where school outcomes are currently weakest. These areas, 95% of which are outside London and the South East, will benefit from intensive investment and support. This will ensure the worst-off schools of the North, Midlands, South West and East of England receive the most support over this decade. They will be supported by the Department for Education (DfE) offering retention payments to schools in these areas ensuring they can retain the best teachers. They will be prioritised for new specialist sixth form free schools that will ensure talented children from disadvantaged backgrounds have access to the highest standard of education this country offers.
• Local Skills Improvement Plans will be rolled out with funding across England, giving local employer bodies and stakeholders a statutory role in planning skills training in their area, to better meet local labour market needs.
• The Government will set out its strategy to tackle the core drivers of health inequalities through a new White Paper on Health Disparities published this year.
• Recommendations will be taken forward from Henry Dimbleby’s review towards a National Food Strategy. DfE will work with the Food Standards Agency to pilot measures to ensure greater compliance with the school food standards. The Government will pilot the Community Eat Well programme, enabling GPs to prescribe exercise and healthy food.

Restoring local pride:

• The Government will support 20 of our towns and city centres, starting off with Wolverhampton and Sheffield, undertaking ambitious, King’s Cross-style regeneration projects, transforming derelict urban sites into beautiful communities. This work will be spearheaded by Homes England, which will be repurposed to, in addition to its existing functions, regenerate towns and cities.
• The ‘80/20 rule’ which leads to 80% of government funding for housing supply being directed at ‘maximum affordability areas’ – in practice, London and the South East – will be scrapped, with much of the £1.8 billion brownfield funding instead being diverted to transforming brownfield sites in the North and Midlands. The Metro Mayors will be allocated £120 million of this funding.
• The Government will announce a plan that for the first time ever, all homes in the Private Rented Sector will have to meet a minimum standard – the Decent Homes Standard. Section 21 ‘no fault’ evictions will further be abolished, ending the unfair situation where renters can be kicked out of their homes for no reason. We will consult on introducing a landlords register and will set out plans for a crackdown on rogue landlords – making sure fines and bans stop repeat offenders leaving renters in terrible conditions.
• Home ownership will be boosted due to a new £1.5 billion Levelling Up Home Building Fund being launched, which will provide loans to SMEs and support the UK government’s wider regeneration agenda in areas that are a priority for levelling up.
• The Government will further commit to building more genuinely affordable social housing. A new Social Housing Regulation Bill will deliver upon the commitments the Government made following the Grenfell tragedy in 2017.
• The White Paper will commit the Government to significantly increasing cultural spending outside the capital and commit that 100% of the Arts Council England funding uplift agreed at the latest Spending Review will be spent outside London.
• A new National Youth Guarantee will be launched so that by 2025 every young person in England will have access to regular out of school activities, adventures away from home, and opportunities to volunteer.
• A review of the Community Ownership Fund will occur so that more fans can take control of their vital local assets such as football club grounds. A £230 million investment in grassroots football will be delivered, with funding this year to deliver 850 pitches in England alone with further funding to Scotland, Wales and Northern Ireland.
• £44 million will be unlocked from the Dormant Assets Scheme to support charities, social enterprises, and vulnerable individuals. With a consultation on the best causes for a further £880 million later this year, which will include a community wealth fund, youth and social investment.
• The White Paper will announce 68 more local authorities to be supported by the High Streets Task Force to transform their town centres.
• The Government will give local authorities the power to require landlords of empty shops to fill them if they have been left vacant for too long.
• £50 million from the Safer Streets Fund will be invested every year to give Police and Crime Commissioners, local authorities and certain civil society organisations in England and Wales the resources they need to tackle crime and anti-social behaviour.
• To ensure those who transgress repair the damage they cause, £93 million will be invested in scaling up the amount of unpaid work that offenders to around 8 million hours per year – 1.75 million hours higher than any time since records began in 2015. Police officers will also gain the power to deal with noise nuisance.
• Building on investment from the 10-year Drugs Strategy, the Government will work intensively with the local authorities of 10-20 areas most affected by prolific neighbourhood crime.

Final Thought:

The silence of local government is deafening in today’s White Paper. Nine hours after the embargoed press release was circulated, still no word from the Local Government Association.

It is not unexpected given the pressures facing local authorities. A reorganisation of local government is hardly at the top of the list when adult social care spending is crippling their budgets, the fallout from the pandemic is still affecting services and local authority workers are demanding better pay and conditions with the ongoing pressures caused by the cost-of-living crisis. They will also be rightly worried about a £16 billion raid on their pension funds, over three times the amount of cash the Government is willing to spend on its own account.

Whilst Downing Street Parties dominate the headlines in the here and now, Boris Johnson’s legacy will be shaped by his ability to deliver on his rhetoric surrounding levelling-up. It will define his premiership and this white paper provides a step in the right direction. It is hard to disagree with Michal Gove, it is bold and will do a lot to empower regional mayors. However, operation red meat is only throwing scraps to local government at best and to deliver this ambitious plan, the Government needs their support.

The other big issue is that the Treasury cupboard is bare. Spending commitments were already made at the CSR and it is unfortunate that the Secretary of State couldn’t wrestle some additional money from the Chancellor to add some shine to today’s announcement. The simple fact is that it is going to take more than £4.8 billion, a tenth of the defence budget, to level-up this country. The post-communist investment by the German Government into East Germany cost trillions, but the result is a higher GDP-per capita than large parts of Northern England. If the Government is truly serious about levelling-up the north, it needs to make the hard choice, increase borrowing, increase taxes, or reduce spending in the south. For now, cakeism still reigns in Whitehall.