- Budget 2021
Image source, Getty ImagesImage caption, Some government departments will have a new hub in Darlington
The Queen's Speech said that the government would "level up opportunities across all parts of the United Kingdom".
Levelling up was also a key part of the Conservatives' successful by-election campaign in Hartlepool.
The idea is that people and communities that feel they have been left behind get a chance to catch up.
What's the problem?
Research from the Institute for Fiscal Studies (IFS) found that: "On a wide variety of measures, regional disparities in the UK are greater than in most comparable countries."
But it also found that after adjusting for housing costs, living standards between UK regions were not particularly unequal.
Many organisations have put forward suggestions of things that need to be addressed such as employment rates, pay, health and formal education, but there seems to be fairly broad agreement that one of the central issues is the differences in productivity between regions – that's the amount of gross value added (GVA) per hour worked.
One of the factors cited as having caused this productivity gap is that government and universities spend more on research and development in the south-east of England.
In its manifesto in 2019, the Conservative Party said it would be "levelling up every part of the UK", which would involve:
- Investing in towns, cities, and rural and coastal areas
- Giving those areas more control of how investment is made
- Levelling up skills using apprenticeships and a £3bn National Skills Fund
- Making life much easier for farming and fishing industries
- Creating up to 10 freeports to help deprived communities.
A group of Conservative MPs has formed a levelling-up taskforce, and is calling for the government to set out geographical analysis of how tax and spending changes affect different areas. Boris Johnson has also appointed Neil O'Brien, MP for Harborough in Leicestershire, as his levelling-up adviser.
The government says it will set out its plans later this year.
Clearly it has been busy with the pandemic (which has itself highlighted problems of inequality in the UK) since the election.
But let's look at what progress has been made in the five areas in the manifesto.
Investing in towns, cities, rural and coastal areas
The chancellor announced in November that he was changing the way that the benefit of investment was calculated to allow projects with big regional impacts to be prioritised.
In his March Budget, Rishi Sunak said that applications were now being sought for some of the £4.8bn Levelling Up Fund, which will invest in infrastructure such as town centres and local transport.
And there will be just over £1bn from the Towns Fund divided between 45 towns in England.
- How did so many Tory-held towns get funding?
But Lord O'Neill, vice-chairman of the Northern Powerhouse partnership (set up by former Chancellor George Osborne) and a former minister under David Cameron, said it was disappointing that some action to help left-behind regions appeared to have been delayed.
He was referring to a White Paper on devolution and local recovery, which was due to come out in 2020 but has been put back and will be published in 2021.
Image source, ReutersImage caption, Some Treasury staff will be based in Darlington instead of WhitehallGiving areas more control over investment
The government has pledged to have 22,000 civil servants based outside London by the end of the decade, having said in its manifesto that "we need to get away from the idea that 'Whitehall knows best'".
In March, the chancellor announced in the Budget that 750 staff from departments including the Treasury and the Department for Business would be based in Darlington.
There is also to be a second housing department headquarters created in Wolverhampton and the new UK Infrastructure Bank will be based in Leeds.
Lord Sainsbury, launching a report on levelling up, said that while moving civil servants around the country was of "symbolic importance", it would not level up.
He argued that for that to happen, more powers would need to be given to local government to control things like transport and the courses taught at local further education colleges.
Image source, ReutersLevelling up skills
The chancellor announced an extra £111m in March to fund work placements and training for 16 to 24-year-olds in England.
Covid has been particularly bad for younger workers, and he also increased the incentives for companies taking on apprentices.
Apprenticeships fell in 2017-18 following the introduction of the Apprenticeship Levy and are still well below the level they were at that point.
As for the National Skills Fund, the chancellor announced an initial £375m for it in November.
The Queen's Speech has also promised a new Lifetime Skills Guarantee which "will ensure everyone, no matter where they live or their background, can gain the skills they need to progress in work at any stage of their lives".
Image source, PA MediaFarming and fishing industries
The 2019 manifesto said getting Brexit done would provide "new support to people in rural and coastal communities, and for our farming and fishing industries".
That promise may ring a little hollow for some. Companies that export some types of shellfish to the EU for example can no longer do business with their main market following Brexit. And all exports of food of animal origin are facing new bureaucracy and costs, which cut into their profits.
The government has set up a £23m support scheme to cover losses incurred in the fishing industry, as well as a new £100m fund to modernise fishing fleets and rejuvenate coastal fishing facilities.
But industry representatives say the promise of taking back full control of UK fishing waters has not yet been fulfilled.
Image source, ReutersCreating up to 10 freeports
Freeports are a big favourite of both the prime minister and chancellor, and eight freeports for England were announced in the Budget. They will be in:
- East Midlands Airport
- Felixstowe & Harwich
- Liverpool City Region
- Plymouth and South Devon
Discussions are under way about where other freeports will be in the UK.
- Freeports: What are they and where will they be?
The chancellor said they would provide "an unprecedented economic boost across the UK".
But a report from UK in a Changing Europe found little evidence that freeports create additional jobs, suggesting that at best the zones would relocate economic activity and jobs.
"The thought they're going to transform the wealth and prosperity of this country is simply untrue," argued Prof Catherine Barnard, one of the report's authors.
"It will help the regions that get a freeport – but possibly to the detriment of those that don't."
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