Andrew Carter is the Chief Executive of Centre for Cities.
Levelling up has joined its friends the ‘Northern Powerhouse’ and ‘rebalancing the economy’ in the big bin of old political slogans. Yet levelling up was the concept that helped seal a convincing 2019 election victory for the Conservatives, making them relevant and trusted beyond their core rural vote – and the problem of regional divides hasn’t gone away.
So just what is the Conservative Party’s position on growth outside of the Greater South East?
The scale of the divides is large. Our Cities Outlook 2025 shows that the average worker in London and Slough has earned by August what the average worker in Huddersfield and Burnley earn in a whole year.
Out of the 63 largest towns and cities in the UK, nearly all those with above-average salaries are in the Greater South East, including Reading and Milton Keynes. Only seven places in the rest of the country have salaries above the national average: Leeds, Warrington, Derby, Swindon, Bristol, Aberdeen and Edinburgh.
This has two impacts that should concern the Conservative leadership. The first is that it impacts the amount of money people have in their pockets, which in turn impacts on the performance of the high street – that barometer of how voters feel a place is doing.
The second is that it impacts on national prosperity. It is striking that most big cities in Britain lag the national average for pay when they should be leading it. Their underperformance weighs heavily on national economic performance.
The cause of this is the attractiveness of places to the emerging, cutting edge of the economy. Cities and large towns in the Greater South East have been very successful at attracting and growing businesses in emerging areas such as AI and FinTech. High-wage cities like London, Cambridge, and Reading have more than twice as many ‘cutting-edge’ firms and three times as many cutting-edge jobs as places with the lowest pay such as Middlesbrough, Burnley, and Huddersfield.
A successful regional economic policy is a one that reduces the barriers to such firms from investing outside of the Greater South East. The current Government will attempt to do this through a combination of devolution and industrial strategy.
Yet whilst it has set out its thoughts on both through green and white papers, much of it has been inspired by thinking under the previous government, which makes it all the more surprising the Opposition’s response has been so muted. On devolution, the Starmer Government is taking on the work done by its Conservative predecessors.
George Osborne was the architect of the mayoral model that Labour is now looking to put in place across England and the single settlements – essentially block grants to mayors – that it will roll out to all big city mayors is an extension of the ‘trailblazer’ deals for Greater Manchester and West Midlands that Michael Gove established in 2022’s Levelling Up White Paper.
There are also many common themes between last October’s Industrial Strategy Green Paper and the strategy that Theresa May set out in 2018, such as sector deals and the creation of an industrial strategy council.
This continuity is broadly welcome. If the plan was a good one then it should still be applicable no matter the colour of the government that introduced it. This means that in principle there should be consensus – so what does this mean for Conservative policy?
The first should be to hold the Government to account on the choices it makes around both. Many decisions are still to be taken in each policy area. But this requires the opposition to have a position. Does a Conservative Party winning back its 2019 voters adopt May’s approach to industrial strategy and Boris Johnson’s approach to regional divides? It would be a good place to start.
The second is to take mayoral elections seriously, for three reasons. One, these positions are becoming ever more important in how the country is run. Two, Sadiq Khan and Andy Burnham have the largest direct mandates of any British politician and are amongst the most influential.
Finally, the success of Ben Houchen in the Tees Valley and Andy Street in the West Midlands (until his defeat by the finest of margins last May, at a time when the national party was heading to a landslide defeat) shows how it offers a route to power even in urban areas (which takes on an extra degree of significance in Opposition).
To take them seriously is to field strong candidates and sufficiently resource the campaigns.
Candidates for the four elections this May – Cambridgeshire and Peterborough, West of England (both of whose inaugural mayors were Conservative) and Hull and East Yorkshire and Greater Lincolnshire – have already been selected. They will need serious support if they are to make inroads against Labour and hold off Reform. The work should start now to identify candidates of suitable calibre to run in the 2028 elections in places like West Midlands, Greater Manchester and Greater London.
And what of the Greater South East? While wages are high, so are housing costs. This means that a large chunk of the extra pay earned by workers in this part of the country flows straight to landlords. Robert Jenrick recognised this when Secretary of State and made proposals to release the economy from the headlock the planning system has it in.
This clearly isn’t natural territory for the party. But if it wants growth and wants to appeal to the younger voters to whom home ownership is a pipe dream then it should develop the positions set out by Jenrick.
The Conservatives took ownership of policies designed at tackling regional divides while in office, and made electoral in roads as a result. The fall of the Red Wall was much celebrated; if the Conservatives are to get back into power then it will likely need to win these voters over once again.
But for that it will need a position about how they will make these voters better off. There is work to do.
Andrew Carter is the Chief Executive of Centre for Cities.
Levelling up has joined its friends the ‘Northern Powerhouse’ and ‘rebalancing the economy’ in the big bin of old political slogans. Yet levelling up was the concept that helped seal a convincing 2019 election victory for the Conservatives, making them relevant and trusted beyond their core rural vote – and the problem of regional divides hasn’t gone away.
So just what is the Conservative Party’s position on growth outside of the Greater South East?
The scale of the divides is large. Our Cities Outlook 2025 shows that the average worker in London and Slough has earned by August what the average worker in Huddersfield and Burnley earn in a whole year.
Out of the 63 largest towns and cities in the UK, nearly all those with above-average salaries are in the Greater South East, including Reading and Milton Keynes. Only seven places in the rest of the country have salaries above the national average: Leeds, Warrington, Derby, Swindon, Bristol, Aberdeen and Edinburgh.
This has two impacts that should concern the Conservative leadership. The first is that it impacts the amount of money people have in their pockets, which in turn impacts on the performance of the high street – that barometer of how voters feel a place is doing.
The second is that it impacts on national prosperity. It is striking that most big cities in Britain lag the national average for pay when they should be leading it. Their underperformance weighs heavily on national economic performance.
The cause of this is the attractiveness of places to the emerging, cutting edge of the economy. Cities and large towns in the Greater South East have been very successful at attracting and growing businesses in emerging areas such as AI and FinTech. High-wage cities like London, Cambridge, and Reading have more than twice as many ‘cutting-edge’ firms and three times as many cutting-edge jobs as places with the lowest pay such as Middlesbrough, Burnley, and Huddersfield.
A successful regional economic policy is a one that reduces the barriers to such firms from investing outside of the Greater South East. The current Government will attempt to do this through a combination of devolution and industrial strategy.
Yet whilst it has set out its thoughts on both through green and white papers, much of it has been inspired by thinking under the previous government, which makes it all the more surprising the Opposition’s response has been so muted. On devolution, the Starmer Government is taking on the work done by its Conservative predecessors.
George Osborne was the architect of the mayoral model that Labour is now looking to put in place across England and the single settlements – essentially block grants to mayors – that it will roll out to all big city mayors is an extension of the ‘trailblazer’ deals for Greater Manchester and West Midlands that Michael Gove established in 2022’s Levelling Up White Paper.
There are also many common themes between last October’s Industrial Strategy Green Paper and the strategy that Theresa May set out in 2018, such as sector deals and the creation of an industrial strategy council.
This continuity is broadly welcome. If the plan was a good one then it should still be applicable no matter the colour of the government that introduced it. This means that in principle there should be consensus – so what does this mean for Conservative policy?
The first should be to hold the Government to account on the choices it makes around both. Many decisions are still to be taken in each policy area. But this requires the opposition to have a position. Does a Conservative Party winning back its 2019 voters adopt May’s approach to industrial strategy and Boris Johnson’s approach to regional divides? It would be a good place to start.
The second is to take mayoral elections seriously, for three reasons. One, these positions are becoming ever more important in how the country is run. Two, Sadiq Khan and Andy Burnham have the largest direct mandates of any British politician and are amongst the most influential.
Finally, the success of Ben Houchen in the Tees Valley and Andy Street in the West Midlands (until his defeat by the finest of margins last May, at a time when the national party was heading to a landslide defeat) shows how it offers a route to power even in urban areas (which takes on an extra degree of significance in Opposition).
To take them seriously is to field strong candidates and sufficiently resource the campaigns.
Candidates for the four elections this May – Cambridgeshire and Peterborough, West of England (both of whose inaugural mayors were Conservative) and Hull and East Yorkshire and Greater Lincolnshire – have already been selected. They will need serious support if they are to make inroads against Labour and hold off Reform. The work should start now to identify candidates of suitable calibre to run in the 2028 elections in places like West Midlands, Greater Manchester and Greater London.
And what of the Greater South East? While wages are high, so are housing costs. This means that a large chunk of the extra pay earned by workers in this part of the country flows straight to landlords. Robert Jenrick recognised this when Secretary of State and made proposals to release the economy from the headlock the planning system has it in.
This clearly isn’t natural territory for the party. But if it wants growth and wants to appeal to the younger voters to whom home ownership is a pipe dream then it should develop the positions set out by Jenrick.
The Conservatives took ownership of policies designed at tackling regional divides while in office, and made electoral in roads as a result. The fall of the Red Wall was much celebrated; if the Conservatives are to get back into power then it will likely need to win these voters over once again.
But for that it will need a position about how they will make these voters better off. There is work to do.