Levelling up will fail if Boris Johnson pushes for a nationwide approach

The phrase “levelling up” has permeated the political lexicon over the past year or so, but few seem to know exactly what it means or how to do it. 

Andy Haldane, outgoing Chief Economist at the Bank of England, put some flesh on the bones at a timely Policy Exchange seminar last week. 

For Haldane, the levelling up agenda means more than just economic variables, crucial though these are. Health inequalities, for example, are perhaps even greater and deserve just as much attention.

Inequalities across different places  are what statistical physicists call “self-similar”. This means they show the same features, the same distributions, at different geographic scales.  The regional differences in the UK are well known. But the same patterns exist both within the individual regions themselves, and even within the individual boroughs of a region.

This has clear policy implications. Levelling up is not just about making the regions more prosperous. It is about enhancing the prospects of the poorer parts within each region.

Andy Burnham, mayor of Greater Manchester, grasps this point. There is a huge gulf between the northern and eastern boroughs of the city region, and the booming city centre and leafy Altrincham and Sale in the south west. Levelling this up is already part of Burnham’s agenda, but other city regions do not seem to have latched on to this in quite the same way.

Haldane does not have a silver bullet to answer the question of how levelling up is to be achieved. While Haldane stressed the need for a variety of approaches, on some occasion, a strong emphasis on just one factor can be sufficient. For example, Eurostar enabled Lille in France to position itself as a strategic link between not just London, Paris and Brussels, but further afield into Germany.  

In a further-flung example, Estonia has received large amounts of money from the EU for it’s population of 1 million. With a huge concentration on digital specialisation, it has been able to expedite its economic growth. 

So, both infrastructure and other large scale public investments can work. But Haldane’s examples here are the exception rather than the rule.

The vast majority of money allocated for “regional policies” has been spent on building motorways, investing in rail links, and developing business parks. But rather than declining, regional inequalities have widened.

These conventional policy measures then are clearly insufficient in and of themselves to generate the sustained development Boris Johnson has promised. Building on the skills of an area is an obvious point. But the best results come when this is done in an integrated and transformative way. The coalfields of the Ruhr, in Germany, for example, have been transformed into a new generation of clean energy corporations. 

Successful levelling up will require us to shun the traditional routes and experiment. The formula success will not be based on a nationwide policy, but rather trying and testing out different efforts in a given area.

Paul Ormerod
As published in City AM Wednesday 7th July 2021
Image: Number 10 via Flickr

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e: aobyrne@volterra.co.uk
t: +44 020 8878 6333

Alex O’Byrne, Associate at Volterra, is an experienced economic consultant specialising in economic, health and social impact, economic strategy, project appraisal and socio-economic planning matters.

Alex has led the socio-economic and health assessments of some of the most high profile developments across the UK, including Battersea Power Station, Olympia London, London Resort, MSG Sphere and Westfield. He has significant experience inputting to EIAs and s106 discussions as well as drafting economic statements, employment and skills strategies and affordable workspace strategies.

Alex is also experienced at economic appraisal for infrastructure. He was project manager of the economic appraisal for the City Centre to Mangere Light Rail in Auckland. He also led the economic and financial appraisals of the third tranche of the Transport Access Program for Transport for New South Wales, in which Alex developed and employed innovative methodological approaches to better capture benefits for individuals with reduced mobility.

He is interested in the limitations of current appraisal methodologies and ways of improving economic and health analysis to ensure it is accessible to as many people as possible. To this end, Alex recognises the importance of transparent and simple to understand analysis and ensuring all work is supported by a robust narrative.

Alex holds a BSc (Hons) in Economics from the University of Manchester and he was a member of the first cohort of the Mayor’s Infrastructure Young Professionals Panel.


Senior Partner

e: eevans@volterra.co.uk
t: +44 020 8878 6333

Ellie is a partner at Volterra, specialising in the economic impact of developments and proposals, and manages many of the company’s projects on economic impact, regeneration, transport and development.

With thirteen years experience at Volterra delivering high quality projects to clients across the public and private sector, Ellie has expertise in developing methods of estimating economic impact where complex issues exist with regards to deadweight, displacement and additionality.

Ellie has significant experience in estimating the economic impact across all types of property development including residential, leisure, office and mixed use schemes.

Project management of recent high profile schemes include the luxury hotel London Peninsula, Battersea Power Station and the Nova scheme at London Victoria. Ellie has also led studies across the country estimating the economic and regeneration impact of proposed transport investments, including studies on HS2 and Crossrail.

Ellie holds a degree in Mathematics and Economics from the University of Cambridge.