Hal Arnold-Forster
Policy and Research Analyst at ChamberIn 2019, Boris Johnson was elected with a majority of 80 seats, and a 43.6% share of the popular vote, the highest since 1979. His Government had the chance to truly transform society in nearly any way they saw fit, but there is certainly now a sense among many that this opportunity has been squandered.
At this election, the key pledge of Johnson (outside of getting Brexit done) was ‘Levelling Up the United Kingdom’. For the first two years of his tenure, it was largely criticised as a scattergun collection of vague platitudes, but the substance of the Levelling Up agenda was finally spelled out in (slightly) clearer detail in the Levelling Up White Paper, published in February of this year. However, just five months later Johnson’s premiership (and Michael Gove’s tenure as Secretary of State for Levelling Up) have reached sudden and undignified endings.
This of course begs the question as to whether the same will be true for the Levelling Up agenda itself.
An Opportunity Squandered
That it took the Government two years to spell out exactly what they meant by ‘Levelling Up’ (with inexplicable reference to Jericho and Constantinople) is indicative of the extent to which they have delivered on this manifesto commitment.
To be clear, there have certainly been some victories. Government defenders may point to the eight freeports being rolled out across England and the investments into Levelling Up skills. However, with Johnson’s premiership dominated by Brexit and COVID-19, you would be hard pressed to argue that Levelling Up has been all that it promised to be.
While Government Ministers will boast of 105 areas splitting the £1.7 billion allocated under the first round of the Levelling Up fund, a Panorama freedom-of-information request sent to 100 councils representing the most deprived areas in England found that 28 councils had all of their bids rejected, including 18 areas on the Government’s top priority list. Economist Nicola Headlam who had worked at the Department before it’s rebrand, described the process as “a beauty contest around who gets the money.”
Moreover, a damning report from the Public Accounts Committee accused the Government of opacity, and “gambling” £1.7 billion in taxpayers money. The Committee found that, by the time Ministers had decided on the criteria upon which to award the fund, they had already decided which of the 170 shortlisted bidders would be successful as a result of these principles.
In a damning statement, Committee Chair Dame Meg Hiller said: “without clear parameters, plans or measures of success it’s hard to avoid the appearance that government is just gambling taxpayers money on policies that are little more than a slogan, retrofitting the criteria for success and not even bothering to evaluate if it worked.”
This came just a year after Ministers were accused of directing Levelling Up funding to Conservative held areas, despite their relative affluence. It also followed a previous report from the Committee which found that selection processes for the ‘Towns Fund’ “had not been impartial” and that, as with the first round of the Levelling Up fund, there had been serious problems in transparency over which areas were successful or unsuccessful and why.
And as the Conservative Leadership contest begins to dominate the party, Shadow Communities Secretary Lisa Nandy accused leadership contenders of “[vying] for the mantle of Margaret Thatcher” and declared that government promises around Levelling Up “made with a bang are fading with a whimper”.
The Next Level
The change in Prime Minister represents something of a crossroads for the Levelling Up agenda.
To be clear, Levelling Up is not going anywhere. Levelling Up is not new now and it was not new in 2019. Before it was called ‘Levelling Up’ it was ‘The Northern Powerhouse’, and when the slogan ‘Levelling Up’ loses its polling power, it will be called something new.
The fundamental aim however, of tackling regional inequality in the UK is uncontroversial and going nowhere. No one in UK politics (overtly) advocates in favour of regional inequalities.
But despite a lack of champions, the UK is home to massive regional inequality. According to research from the Institute for Fiscal Studies, the UK is “one of the most geographically unequal countries in the developed world” across earnings, wealth, health, educational attainment and social mobility. The London Metropolitan area generates approximately 1/3 of the UK’s GDP.
Regardless of the party in power, regional inequality will always be a question that needs addressing. If Labour wish to regain lost ‘Red Wall’ seats, they will need a policy platform that speaks to these inequalities and changes the perception of Labour as overly London-facing.
Under Starmer, it does seem that this aim is there. Lisa Nandy recently said that “the Tories’ commitment to Levelling Up is dead. But Levelling Up is not dead. Not for the millions who voted for change – and who need and deserve to see it delivered.”
Where does Levelling Up go now?
So the question isn’t really whether Levelling Up will continue in the long-term. It will in some capacity, perhaps with a new name and unveiling speech at party conference. The question is where it will sit in the new Conservative Government’s agenda. Certainly, with the recent opening of the second round of the Levelling Up Fund, there is a strong platform on which to build.
Levelling Up was put on the back burner while the pandemic and Brexit often took precedence, and for this Government, they will have to balance Levelling Up against the looming problem of inflation.
Levelling Up remains a priority for members of the Conservative party at large. Jake Berry, Chair of the highly influential Northern Research Group (NRG) of 50 Conservative MPs insisted that if the next Prime Minister did not deliver on the 2019 manifesto promise, they would be severely punished in 2024. Similar sentiments have been expressed by the Conservative Mayor of Teesside Ben Houchen, who said: “to respect the mandate of the people, the next Prime Minister wishing to serve our country must be fully on board with the Levelling Up agenda.”
As a first priority, the next Prime Minister needs a serious economic strategy which prioritises productivity, skills and education. Growth will not recover without one.
These criteria are at least theoretically met by a coherent, well-delivered and properly measured Levelling Up agenda. However, the Levelling Up agenda is undeliverable with irresponsible tax cuts that will add to inflationary fears, fuel further interest rate hikes from the Bank of England and ultimately leave everyone worse off.
Simply put, current rates of inflation are incompatible with Levelling Up. Any measures that fuel inflation further necessarily undermine any policy programme that is designed to spread prosperity across the UK.
If the next Prime Minister is serious about Levelling Up, they will have to carefully weigh their instinct to cut taxes against this.