The Levelling Up White Paper: You’ve Got to Start Somewhere

Commentators were fairly quick to pour cold water on the long-awaited Levelling Up White Paper, the UK Government’s first comprehensive statement as to what ‘levelling up’ actually means. In particular, critics pointed to the lack of new money and new powers for localities to solve their own problems.

However, at least it’s a start. Most importantly, it does define much more clearly what the Government wants ‘levelling up’ to mean. There was a danger that ‘levelling up’ as a vague phrase was coming to mean tackling any inequality or unfairness of any sort, whether geographical, financial, fiscal or social. However, the White Paper has a clearly structured approach to the problem which sees the task as being about four (admittedly broad) things:

• boost productivity, pay, jobs and living standards by growing the private sector, especially in those places where they are lagging
• spread opportunities and improve public services, especially in those places where they are weakest
• restore a sense of community, local pride and belonging, especially in those places where they have been lost
• empower local leaders and communities, especially in those places lacking local agency

Under each of these four objectives are three ‘missions’ per objective, so there are twelve rather more manageable individual missions covering matters such as transport, housing, crime, and skills of the sort that individual Whitehall departments will be able to get their heads around. These objectives and missions are not all defined in the same terms – some are outcomes (‘higher productivity’), others are outputs (‘more decent housing’) and some are merely processes (‘more devolution deals’). So some will be more easily achieved – and more easily translated into practical targets and actions – than others.

And the outcomes are a huge challenge which will take decades – especially improving productivity growth in lagging regions. In particular, these outcomes need sustained activity and focus, which has been provably very difficult to achieve. For example, the 1997-2010 Labour Government attempted (some claim unsuccessfully) to make progress on the issue with an aggressive Treasury-led cross-cutting review looking at deprived areas; funds like the Neighbourhood Renewal Fund; and new Regional Assemblies and Regional Development Agencies tasked with what we now call levelling up. And both Labour and the Coalition Government promoted city mayors. Even if such initiatives were worthy in their own right, the White Paper makes it clear that the problems they were seeking to solve are still with us.

The Government’s decision to set targets for 2030, just eight years away, is therefore staggeringly ambitious. While the Government might be setting itself an unmanageable task, it can hardly be accused at the same time of kicking the problem into the long grass.

More to the point, it does at least look like the Government is focusing on the right things, especially the very thorny issue of the productivity gap. And we have previously argued that an effective local politics at city level, thriving R&D and business innovation, and a vibrant cultural scene are crucial to attract investment and promote growth. And these are not guaranteed – for example we have also argued that cities in Scotland are not necessarily getting the powers they need because preoccupations about devolution are focused elsewhere.

Real estate decision makers should not expect that any of this new policy to be immediately transformative or that the infrastructure, planning or housing floodgates will suddenly open. There will be reversals and changes of strategy, such as the decision not to proceed with sections of HS2. The task requires breathtaking levels of sustained and diligent focus which will need to survive multiple political cycles. But even though there isn’t much new money, the private sector appetite to invest more into regional real estate is very substantial. If public money is better focused on relevant objectives, supported by decent policy frameworks, public-private partnership and appropriate city-level devolution, then this latest attempt at boosting underperforming places will attract sufficient private sector investment for it to have been worth it.