The government’s new levelling-up strategy should help Britain’s left-behind towns and cities emulate Renaissance Florence in cooking up the “secret sauce” of economic success, according to its co-author Andy Haldane.
The hefty report, published on Wednesday, was mocked by some for its frequent historical references – including to 15th-century Florence under the Medici – but Haldane, a former Bank of England chief economist, is deadly serious.
Only by looking back at where and when economic development has really worked, he says, can we decide how to reverse what he calls 70 years of government failure in tackling regional inequality.
“The power of this is not that every part of the UK is going to look like Florence – I think that would be a stretch,” he said. But he added that the “raw ingredients” were the right ones. “It was the coming together of scientists and artists and business people, and financiers of course, as the Medicis themselves were. It was that crucible, of skills and of professions and of sectors, public, private, third, that generates a kind of spontaneous combustion.”
As the permanent secretary to the Cabinet Office and former chair of the industrial strategy council, Haldane was a key driving force behind the 350-page document. It set out for the first time what Boris Johnson’s election pledge to “level up” the UK means in terms of policies and targets.
Twelve wide-ranging new “missions” on narrowing regional gaps in everything from healthy life expectancy to crime rates will be put into legislation, giving the government a duty to pursue them. And a new wave of devolution will see every area in England given the option of a London-style metro mayor.
Haldane said the agenda had been made all the more pressing by the cost-of-living crisis, which is hitting hardest in many of the areas the report is focused on helping. “Let’s not mince our words: the numbers are big and they are real,” he said. But he added that it “reinforces the importance” of taking action.
While experts have praised its ambition, some have questioned whether the white paper’s many targets are too scattergun: the director of the Institute for Fiscal Studies, Paul Johnson, warned: “There is something for everyone, and hence little sense of prioritisation: ambition and resource will be spread very thin.”
But Haldane insisted that economic regeneration only works when a range of different factors are tackled. “We know the secret sauce of success in places has these multiple ingredients. You can’t just not do transport, or not do high streets or not do jobs or not do broadband,” he said. “You’ll fail if you have one missing ingredient, in the same way as if you miss out the eggs or the sugar or the flour from the cake, it’ll fall flat.”
Another major question mark over the report was whether the Treasury had set aside enough resources to match its ambition – and whether Rishi Sunak was really committed to the agenda.
Haldane acknowledged that the current three-year spending review, which he admitted was “sealed”, would have to be just the start. “It’s a 2030 mission. So the government – whichever government – will have several bites at this cherry. Several spending reviews to get through.”
He also argued that spending on many areas of public services, from health to transport to crime, could serve the purpose of helping to level up the UK, as long as they were distributed towards the areas of greatest need. “We’re talking about general wellbeing and pride in place; that doesn’t translate into a single budgetary pot.”
All departments will now have to report the spatial allocation of their spending across the country, in the hope that this will help to drive change. “Shocker: some departments couldn’t even tell you where it’s going geographically.”
Haldane also pointed to improvements that can be made without funding from taxpayers, through regulation, for example.
The white paper included an announcement that the government’s Decent Homes Standard, setting minimum levels properties must reach, would now be applied to private rentals.
“I was in Blackpool a few years ago now. And I remember touring around some of the private rental sector houses – they were absolutely horrific,” he says. Official figures show that 21% of private rental properties fail to meet the required standard. “It’s completely intolerable,” Haldane said.
He added that “private landlords will have to pay” for the necessary improvements: “I would say that’s the right outcome”.
With the launch coming in the middle of another chaotic week for Johnson’s teetering government, senior officials like Haldane could be excused for wondering if their big ideas would last more than a few weeks.
But he insists the levelling-up agenda is here to stay – “the opposite of a bad budget” that unravels within days. “Looking back at UK history and international history, unless you commit to the long-term course, you’ve got absolutely no chance,” he said.
