Tag: Sir Richard Leese

NORTHERN POWERHOUSE: SLOGAN OR SUBSTANCE?

An almighty shot has been fired across the bows of Lord O’Neill of Gatley ahead of a major business conference on The Northern Powerhouse (TNP) next week.

Jim O’Neill as he’s better known up here is now a Treasury Minister on the back of writing a highly influential report identifying cities rather than regions as engines of growth.

He’s coming to Manchester next week to give a boost to the two year old project that’s beginning to attract critics. One is Jen Williams, the talented political correspondent of the Manchester Evening News. In a recent article she claimed NTP was just a slogan, if one cared to look at the record rather than the rhetoric of Lord O’Neill and his boss the Chancellor, George Osborne. She cited the flagrantly biased recent award of extra cash to southern councils while northern authorities like Lancashire made massive cuts with talk of the Red Rose council withering altogether. She went on to say that these cuts damaged attempts to solve deep seated social and poverty problems engrained in the North for so long. The NTP’s emphasis on building things was not enough. Finally there was the unbelievable closure of the government’s skills department in Sheffield with the loss of 250 jobs..

The attack clearly went home because Lord O’Neill didn’t wait to get to Manchester to hit back claiming employment was growing faster in the north than elsewhere, power was being devolved through elected mayors, Transport For the North would deliver connectivity improvements and good things could be expected from the Infrastructure Commission shortly.

But the criticism isn’t just from journalists. Jim McMahon was the leader of Oldham Council and tipped to run for elected mayor of Greater Manchester until he unwisely took the Westminster route by becoming MP for Oldham West. He has been closely involved in the devolution negotiations and recently told MPs of his deep unease over TNP. He feels it does not empower communities, a criticism felt by many who say all the deals have been stitched up by councillors and ministers with no public consultation. McMahon called for a national framework for devolution rather than the highly complex and differentiated pattern of powers that have been handed out across the North. The government call it responding to local factors. I call it a dog’s breakfast.

Next week’s UK Northern Powerhouse International conference aims to tell ministers what northern business leaders think has to be done to really rebalance the UK economy. There is a feeling that TNP is not yet scaled up to do this. I would argue this has been the flaw in the strategy of both the Coalition and Conservative governments. They broke up the large development agencies which were in the process of creating the Northern Way to really counter the powerful London economy and we have been struggling ever since with a patchwork of Local Enterprise Partnerships, Combined Authorities and Growth Funds.

There is also the haunting question “will it last?” When George Osborne ceases to be Chancellor will the London centric civil servants start to unravel the project with a weaker politician in charge? Regional policy has been notoriously at the whim of ministers. I asked Manchester Council leader Sir Richard Leese about this at a recent Downtown event. He replied that that was why Manchester was grabbing as much power as it could while the policy is intact. Wise man.

LABOUR OLDHAM WARNING AS OSBORNE MARCHES ON

OLDHAM WARNING FOR LABOUR.

A Labour contact of mine in the Oldham West by election says on the doorstep traditional Labour voters are raising Corbyn’s leadership all the time. This could be significant as “Westminster bubble” issues don’t always resonate with voters.

The feedback from this northern seat is that Corbyn and his close advisers are all perceived to be from a London clique who haven’t a clue about the North. This impression will be compounded by Corbyn’s decision to cancel his planned Friday visit to the by election as he tries to sort out serious divisions over his party’s policy on bombing Syria.

All this means that we would be unwise to rule out UKIP doing very well next Thursday night in Oldham West and Royton.

OSBORNE FOR PRIME MINISTER?

George Osborne’s shameless U turn on tax credits and police cuts will be long forgotten if his gamble in believing in a continuing world of low inflation and interest rates pays off. In his six years as Chancellor, he has shown himself generally to have a pragmatic and politically sensitive approach. Made a mistake over pasties or tax credits? Make a change and move on. His upbeat approach at all three budget statements this year raises the morale of backbench Tories who think he’s a winner. They also like the ideology which runs underneath the pragmatism. Osborne is determined to create a smaller state. By 2020 it will have shrunk from 50% to 35% of gross Domestic Product.

This is most clearly seen in housing policy. The private sector is to be incentivised to build 400,000 homes with a strong emphasis on making them available to buy not rent. Along with the right to buy for Housing Association tenants, the thrust of government policy is clearly away from social housing to home ownership. First time buyers with incomes of up to £80,000 in the North will be able to benefit from the subsidies offered. The policy will not help the poor who are most in need of housing.

On education George Osborne explicitly said the days of local councils running schools would be a thing of the past. 500 new free schools are to be built.

So ideology to please the Tory backbenches, pragmatism to please the voters, could this be a combination that allows George Osborne to see of Theresa May or Boris Johnson in the leadership election? At the moment he has to be favourite but what if things go wrong.

THE GAMBLE.

The Treasury are spinning that this isn’t the end of austerity. Well a strategic decision has been taken to take advantage of the more optimistic outlook offered by the Office for Budget Responsibility to ease the cuts in the early years of the parliament and breach the welfare cap. There is a heavy reliance on continued low inflation rates and growth of around 2.5%. If “events” happen like a further downturn in the Chinese economy, Osborne’s gamble could unravel just when he’s seeking to become Prime Minister. In that respect it is strange that he has decided to defer more painful cuts till nearer the election rather than getting them over now.

WHAT IT MEANS FOR THE NORTH.

Sir Richard Leese, the leader of Manchester City Council had challenged the Chancellor to put the flesh on the bones of the Northern Powerhouse particularly in relation to transport. Well there is £200m for transport including £150m for an “oyster” card system. This is brilliant news. Anyone who uses London Transport knows that card makes the use of public transport so easy. The M6 between junctions 16-19 is to upgraded. The motorway which enters the north through the important gateway of Cheshire and Warrington is often overlooked when connectivity is discussed. There are major investments in science and nuclear power. New Enterprise Zones are being created in Leeds, York, Greater Manchester Life Science Park, Cheshire Science Corridor and Hillhouse Chemical on the Fylde.

LABOUR VICTORIES.

Labour can claim to have forced the government to retreat over tax credits and police cuts but they still shoot themselves in the foot.

Liam Byrne’s 2010 message left on a Treasury desk saying there was no money left, Ed Miliband’s headstone and Shadow Chancellor John MacDonald’s brandishing of Chairman Mao’s Little Red Book are a woeful series of unnecessary public relations gaffs.

The tragedy is that the issue that MacDonald was trying to raise, the worrying amount of our infrastructure owned by the Chinese is a valid one.

FRANTIC FOOTBALL AND DEVOLUTION DEADLINES.

REAL POWER OR A CONFUSING MESS?

This week the deadline passed for northern councils to submit their bids for devolved power. Will this herald the real start for a coherent, democratically run, Northern Powerhouse or a mishmash of devolved functions confusing to business and voters alike?

Government policy faces two ways on this issue. On the one hand they want requests for devolution to come from our city and county regions, allowing for a varied pattern to suit the area concerned. This is in the belief that one size doesn’t fit all. On the other hand ministers are very firm in their belief that elected mayors are a condition for real “Manchester” style devolution.

As deadline day approached there were frantic moves across the North to get bids in. In some areas it mirrored football’s transfer deadline day. But before surveying the complicated picture from Merseyside to Leeds, let’s remind ourselves what this is all about and whether it matters to business.

Conservatives in the previous Coalition government were determined to dismantle the structure of regional power put in place by Labour. They believed that city regions provided the real engines for growth working alongside business driven Local Enterprise Partnerships. Many Labour city leaders agreed with them, particularly Sir Richard Leese, the leader of Manchester Council. He formed a powerful alliance with the Chancellor George Osborne in launching the concept of the Northern Powerhouse to link major cities like Leeds, Manchester and Liverpool together.

Greater Manchester struck a deal before the election to get widespread economic, housing and health powers. In return they reluctantly accepted an elected mayor. Former MP Tony Lloyd is filling that role on an interim basis.

Other cities in the North were much more reluctant to accept an elected mayor and perhaps hung back awaiting the outcome of the General Election. Now with a fully Conservative administration and a new Local Government Secretary, the choice has been simplified It’s Greg Clarke’s way or the highway.

The sort of powers that might be devolved are important for business. The skills gap, poor transport links, planning, and access to finance are some of the issues firms are concerned about and being able to influence policy locally rather than traipsing down to Whitehall must be good.

So as the deadline passes, what is the picture in the North? In Greater Manchester the deal is done whilst on Merseyside things remain complex. The bid, which is also a response to the general Spending Review, has been described as “a work in progress” by officials. Veteran Liverpool Lib Dem councillor Richard Kemp prefers “last minute” which he regards as the wrong approach when control of £4.5bn of expenditure is involved. The problem on Merseyside has been the difficult relationship between the leader of the City Region, Cllr Phil Davies of Wirral and the elected mayor of Liverpool Joe Anderson. The latter believes in an elected mayor for the sub region whereas other councils in the sub region see it as a recipe for a Liverpool takeover.

To the south Warrington and Cheshire Local Enterprise Partnership is putting in its own bid for devolved powers, not wishing to be overshadowed by the city based Northern Powerhouse.

Similar sentiments prevailed in Lancashire last week at a Downtown sponsored event. The county’s leader Jennifer Mein pointed out they had the third largest economy in the North. Business wants a united bid for power but once again there are local sensitivities as Lancashire has to deal with Blackburn and Blackpool unitary authorities as well as 12 district councils.

In Yorkshire there has been a lively debate around three proposals. Some argue that the Yorkshire brand is known around the world and so the devolution deal should be county wide. Geoff Boycott for elected mayor anyone? Leeds remains convinced that a city region based solution is best involving some of the surrounding towns. Meanwhile a third group would like to contain Leeds and go for a North and East Yorkshire sub region.

This process across the North has lacked real input from the people and it will be down to Communities Secretary Greg Clarke to hand down decisions from the centre once again.

Follow me at www.jimhancock.co.uk

TORIES DISCOVER NORTH SHOCKER!

Having swept away all the organisations that were helping the Northern economy, the Coalition government has spent the last few years building them up again.

Although the patchwork of Local Enterprise Partnerships(LEPs), Mayoral Zones and Regional Growth Funds will never make up for the lost coherence of the Regional Development Agencies (RDAs) in the North West and Yorkshire, there are signs that some LEPs are getting to grips with their task.

This is important as the Chancellor has signified this week that he may be getting serious about doing something to empower the North, sandwiched as it is between Scotland and London which both want for nothing in terms of government spending.

The Northern Way, which was the umbrella organisation for the northern RDAs, would have been the perfect organisation to deliver the trans Pennine HS3 rail link that George Osborne envisages. We will have to wait and see how the project is to be managed if this announcement is anything other than a smokescreen for the complete lack of a coherent policy for the North.

Another example of the government’s incoherence has been with elected mayors. First they wanted them just for cities and with no extra power. Now they want them for city regions with some real power and money.

Liverpool in particular could do with a city region mayor to bring democratic accountability to the LEP which has substantial achievements under its belt. A mayor who covered the whole sub region from Wirral to St Helens would also help solve the current impasse with the Liverpool Combined Authority (CA) of councils. This is caused by the fact that Phil Davies, the leader of Wirral, heads the organisation rather than the Mayor of Liverpool, Joe Anderson.

The government will have a tough job selling the concept of an elected mayor for the whole of Greater Manchester for a number of reasons. Manchester residents rejected the concept for their city, and there is already an elected mayor in Salford. Furthermore the LEP under chair Mike Blackburn, the Combined Authority under Lord Smith of Wigan and Manchester City Council led by Sir Richard Leese are already driving economic regeneration effectively.

The Liverpool LEP has an impressive record too, partly helped because it inherited the Mersey Partnership. It has 450 subscribing private sector members. Recent figures from the Office of National Statistics concerning growth rates shows Liverpool as ninth out of 39 LEPs in the UK.

Liverpool LEP is hoping to be allocated a good chunk of the £2bn Local Growth Fund to be announced soon and is coordinating the spending of 221 million Euros it has been allocated from European coffers.

Specific achievements include helping fibre optic company Tratos expand in Knowsley with the creation of 100 jobs. The LEPs Business Growth Grant will help create 2000 new jobs and the New Markets Programme, developed by the LEP is helping small businesses get a 35% subsidy for their growth plans. Meanwhile the Skills for Growth Bank, backed by the LEP has approved £2.5m for business growth.

The Liverpool LEP is headed up by Robert Hough who has patiently rebuilt an organisation to support business after being chairman of the North West Development Agency when it was swept away. A quietly efficient man who does not seek the headlines, his organisation’s profile might be improved if its boundaries were shared with an elected mayor for the same area.

Politicians bring campaigns and the media spotlight would then perhaps be turned on to the somewhat dry world of economic regeneration.

Personally I believe if the government wants city region mayors, they should legislate for them. There are enough referenda in the air at the moment.

In the meantime the Liverpool LEP will get on with the job of bringing employment to the City Region.