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Local Elections 2022: A False Dawn? Labour’s Success in London Masks its Deeper Problems

Published by Anonymous (not verified) on Fri, 06/05/2022 - 9:23pm in

Labour’s local election performance spells danger for the party, argues Sam Bright

I awoke this morning to a frenzy of jubilation on social media – from London-based Labour activists, celebrating the party’s historic electoral success in the capital.

“A new dawn has broken, has it not?” one posted, seemingly referencing Tony Blair’s 1997 General Election landslide.

Labour has undoubtedly seen some remarkable results in the capital, following yesterday’s local elections. Wandsworth, Barnet and Westminster councils have all fallen to Keir Starmer’s party, after years – even decades – of Conservative rule.

However, with the Labour Party, there must always be a caveat.

“London will be even more clearly a one-party fiefdom,” says elections expert Professor John Curtice. “But outside London, as compared with 2018, when the seats were last contested, it looks like Labour’s vote is actually down slightly.”

Indeed, Labour went into the night expecting to lose seats overall in England outside London, and that appears to have been the case.

The so-called ‘Red Wall’ is a consideration here – the bloc of former industrial Labour seats that flipped to the Conservatives in 2019. The seats contested yesterday were last fought in 2018, and so Labour’s relatively stable showing in the north has been interpreted as the party improving its performance from the last general election.

But this analysis neglects several important factors.

Primarily, Labour lost three consecutive elections prior to 2019, even though it retained the bulk of its Red Wall seats. Theresa May’s Conservatives won a narrow majority of seats in 2017, with the assistance of the Democratic Unionist Party, even though Labour’s support climbed in some former industrial areas.

To interpret Labour’s performance, we therefore need to look both beyond London and the Red Wall.

The party’s decline as an electoral force has coincided directly with its demise in Scotland. In 2005, Labour won 41 of the 59 available Westminster seats in Scotland and 39.5% of the vote share. At the 2019 General Election, however, the party won a solitary seat in Scotland – Edinburgh South – and 18.6% of the national vote.

Though the results of this year’s elections in Scotland are behind England, the polls suggest that Labour will replace the Conservatives as the party of opposition, while the dominant Scottish National Party (SNP) will largely maintain its position.

Labour’s path to power runs through Scotland – either in the form of mass Labour gains, or a pact with the SNP. The latest Britain Elects general election polling tracker has Labour 30 seats short of a Westminster majority, with the Liberal Democrats winning 18 seats and the SNP on 55.

In fact, if Labour doesn’t make up significant ground north of the English border – or agree a deal with the SNP – Starmer’s party would need to win North East Somerset from Jacob Rees-Mogg (who currently has a 36% majority) in order to walk into Downing Street as the single party of government.

Camping in the Fortress

Labour’s performance in these local elections presents another danger: the risk that the party will become further entrenched in its ideological heartland – London.

Over recent years, Labour’s support has fortified in diverse, liberal metropolitan hubs – particularly in the all-consuming capital. Roughly a-quarter of sitting Labour MPs represent a London constituency, despite the capital only accounting for some 13% of the UK population.

As described by Maria Sobolewska and Robert Ford in Brexitland, by 2015 Labour represented 67 of the 75 seats in England and Wales where the white population share was below 75%. These MPs also carried overwhelming local support, boasting an average majority of 30%. 2015 was the first election in which liberal identity groups outnumbered conservative identity groups among Labour voters – signalling the direction of travel within the party towards a more urban composition and outlook.

Labour has a problem in towns and rural areas – and these local election results do not show a marked abatement of that trend. As the Fabian Society pointed out in a 2018 report, 61% of surveyed people in rural England and Wales said that Labour does not understand people who live in the local area, compared to 45% in ‘town and fringe’ areas and 39% in urban Britain.

“Labour’s association with cities leads to an association of Labour with urban snobbery towards rural areas – a sentiment that was shared almost unanimously by participants in all focus groups,” the report stated.

In the south-west, for example, the Liberal Democrats have been mounting a charge against the Conservatives, logging big gains. This will act to Labour’s benefit overall, stripping the Tories of seats. But Labour’s concentration in London risks skewing the party’s mindset even more towards the beliefs embodied by the capital – a place that is ostracised from the rest of the country and therefore poses a danger to the progressive movement.

London is more liberal, more diverse, better educated, more wealthy (and more impoverished) than anywhere else in the country – a political and demographic outlier.

The non-white British population constitutes 55% of the capital, compared to just 20% in the second most diverse region, the West Midlands. Statistics produced by the Office for National Statistics in 2020 suggest that, of the 50 places with the highest disposable incomes in England and Wales, 41 were in London. The capital also has the highest rates of poverty in the country. If London’s impoverished formed a city of their own, it would comfortably be the second-largest in the UK.

If, in the hysteria of its electoral successes in the capital, Labour further absorbs the ideological composition of London, it will continue to alienate towns and rural areas – or, at the very least, it will not be able to recover these seats in sufficient numbers to win a general election.

Taken as a whole, this year’s local election results merely uphold Labour’s direction of travel since 2010.

In 2019, Labour’s share of the vote increased in just 13 seats – 2% of all House of Commons constituencies. These seats were characterised by a relatively large number of black and ethnic minority voters, a significant number of professional workers, relatively high levels of deprivation, situated in or around large cities – especially in London. 

In short: Labour gained votes in London, lost some votes in other cities, and haemorrhaged support in all other areas. The continuation of these trends in 2022 – albeit with a modest uplift in support relative to 2019 – shows that Labour has not become a potent electoral force.

An Opportunity

We must also keep in mind the scale of Labour’s task. To win the number of seats needed to form a majority at the next election, Labour must increase its number of MPs by more than 60% – a feat that has never been achieved by any major party.

Yet, to stand a fighting chance at the next election, Labour must resist its retrenchment to London. Its path to victory runs through the north, and it must quickly establish how to win over Scotland – or how to align with the SNP without alienating England.

However, in this regard, the Conservatives may present Labour with an opportunity. Boris Johnson’s ‘Partygate’ antics, and the prevarications of Scottish Conservative Leader Douglas Ross – first calling for Johnson to resign, before backing the Prime Minister – looks set to give Labour a firm foothold in Scotland.

Additionally, it seems likely that the migration of ‘Blue Wall’ seats to the Liberal Democrats will prompt the further dilution of Johnson’s flagship ‘levelling up’ agenda.

“The Government is evidently letting politics drive levelling up,” Greater Manchester Mayor Andy Burnham said in an interview for my book, Fortress London.

Burnham notes that, since the Conservative Party’s loss to the Liberal Democrats at the Chesham and Amersham by-election in June 2021 – a model Blue Wall constituency – the Government has stretched the scope of levelling up beyond the Red Wall, increasingly applying the term to the south as well as the north. 

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“Without being cynical, levelling up is the right theme – but it has got to be done in the right places and in the right way – and not so broad that it becomes meaningless,” Burnham told me. “If anything, we’re in retreat from where Johnson was a couple of years ago. The question is how far in retreat.”

In other words, in order to stem its losses in the south, the Government may diminish or even dispense with its pledge to invest disproportionately in former industrial areas – instead redirecting funds to the Home Counties.

On this front, Labour must be ruthless. It must pore over the Government’s plan and expose its contradictions – showing unequivocally that Johnson’s sloganeering will not provide economic sustenance to the midlands or the north. And Labour must develop a compelling alternative agenda – speaking to the cultural conservatism and the economic radicalism of voters who are increasingly disenfranchised with mainstream politics.

Above all else, Keir Starmer must realise that Labour has entrenched its support in London for the last decade – and has lost four consecutive general elections. The party’s success in the capital will generate a lot of noise, but the next election will not be won in London – and, right now, it appears that the party’s former heartlands are still not willing to hand Labour the keys to power.

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Boris Johnson’s Ship is Sinking with Conservative MPs Tied to the Mast

Published by Anonymous (not verified) on Wed, 04/05/2022 - 9:04pm in

Conservative MPs appear complacent as the Prime Minister sails their leaky ship towards the rocks of this week's local elections, reports Adam Bienkov

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“Our fortunes are strapped well and truly to be the mast of the good ship Boris," one Conservative MP and former Cabinet Minister told Byline Times this week.

“And, depending on which of my colleagues you talk to, that either fills them with fear or they tell you: ‘well, in a Boris versus Keir battle we're not going to lose by betting on Boris’.”

This comment is very revealing about the mood among Conservative MPs as voters head to the polls for local elections on Thursday.

While the party has been battered by months of headlines about the Prime Minister's law-breaking, most Conservative MPs believe that they have missed their moment to throw him overboard.

Although Keir Starmer's party has built a clear lead in the polls, Labour is not yet so far ahead as to convince Conservative MPs to take the plunge themselves.

The local elections will be the first real test of this calculation.

The waters ahead look grim for Johnson. In his former London heartlands, polls suggest that he is set for a historically poor performance.

Labour campaigners in the Conservative flagship councils of Wandsworth, Barnet and Westminster say that they are optimistic of making big gains, while Conservatives activists are resigned to a terrible night.

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“I think the Conservatives will lose Barnet, may lose Wandsworth and will probably lose seats in Hillingdon and Westminster," one senior London Labour figure confidently predicted to Byline Times.

If true, this would be a disastrous showing for Johnson, who was London's Mayor between 2008 and 2016. His performance in the city helped create the image of him as a 'Heineken' politician; one who could reach parts of the electorate other Conservatives simply couldn't.

If current polls are correct, that image is about to crumble.

“It looks really, really tough in London,” one Conservative MP conceded to Byline Times, who also predicted that the party would take big losses elsewhere in the country.

In Scotland, where Johnson’s Conservative colleagues publicly called on him to quit earlier this year, the party also looks likely to slip into third place behind Labour.

Meanwhile, a resurgent Liberal Democrats are expected to take big chunks out of Conservative support in parts of the south and south-west.

"Certainly our candidates in these elections have been frustrated by the national party, and they try to avoid mentioning Boris if they can," the MP added.

Yet, such a showing is unlikely to result in the sort of 'Conservative meltdown' headlines you might otherwise expect. This is due largely to the fact that most of the contests will take place in seats already held by opposition parties. Any Conservative losses will also be masked by suggestions that the party appears to be doing less badly in the so-called 'Red Wall' seats previously held by Labour in the north of England. And, because of when these elections were last held, Labour could end up losing seats in these Red Wall areas, even if its overall national vote share rises significantly.

This analysis is shared by Conservative sources, who say that the 'Partygate' scandal is hitting them worst in their southern strongholds, while causing fewer problems in the areas they gained in the 2019 General Election.

'"Whenever we've been knocking on voters' doors, I've been very happy with the response," one Red Wall Conservative MP, who strongly backs Johnson, told Byline Times. "I went out the day after the Prime Minister got his fixed penalty notice and only two people brought it up in about 400 doors."

'Very Easy for Tories to Lose Majority'

How seriously we should take these claims of Conservative resilience in the north of England remains to be seen. However, the sheer number of Labour-held seats in Thursday's local elections means that predictions of massive Conservative losses look likely to be very wide of the mark.

In an interview with Byline Times, Britain's leading pollster, Professor John Curtice, said that the actual number of Conservative losses would likely only be a fraction of the numbers being pushed by some of Boris Johnson’s supporters.

“The Tories are only defending 1,400 seats in England so it's impossible for the number of losses to be very big,” he told Byline Times. “It’s just basic arithmetic.”

Prof Curtice suggested that Johnson’s party would likely only lose a few hundred seats, at most, if current polling is accurate. For this reason, he suggested the focus on seat numbers was not very helpful for understanding these elections.

“If you really want to know how I think you should measure these elections, the answer is to compare the vote shares in 2022 with 2021," he said. “That is by far and away the most useful indicator of what everybody is interested in, which is how much trouble are the Conservatives in now.”

Even this measure may end up giving some comfort to Johnson’s supporters, however.

According to Prof Curtice, current polling suggests that Labour is not doing as well as either Tony Blair or David Cameron did at this point in the electoral cycle when in opposition.

But the problem for the Conservatives is that Labour doesn’t need a particularly large swing at the next election in order to oust Johnson.

“It’s very easy for the Tories to lose their overall majority," Prof Curtice added. “And because they don't have many friends in the House of Commons, once the Tories are below about 320 seats then they’re stuffed and can’t sustain an administration.”

Professor Sir John Curtice. Photo: Mark Hawkins/Alamy

As a result, the Conservatives are already leaning into warnings about 'secret pacts' between Labour and the Liberal Democrats.

The Conservative-supporting Mail on Sunday last week splashed on analysis suggesting that Labour and the Lib Dems had deliberately stood down in seats which the other party has a chance of winning. Warnings of a pact between the two parties also feature heavily in attack lines briefed out to Conservative campaigners this week.

Both Labour and the Lib Dems deny any such deal has been struck and election analysts say that there is little evidence of a co-ordinated plan between the two parties.

Such warnings are also unlikely to carry much water with an electorate that can well remember the Conservative Party's own previous arrangements with the Lib Dems, the Brexit Party and the DUP.

Yet, the fact that Johnson’s party is leaning so heavily into this narrative suggests that it is all too aware of the direction its own ship is heading. Because once the attempts at expectation management are stripped away, current polls suggest that the Conservatives are heading for some very stormy waters indeed.

And if Boris Johnson's ship continues to take on water, then the hopes of his leadership staying above water will only continue to sink.

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North Loses Out as Government Replaces EU ‘Shared Prosperity Fund’

Published by Anonymous (not verified) on Wed, 20/04/2022 - 7:04pm in

Sam Bright and Tom Robinson calculate the reductions in UK regional development spending, compared to the equivalent EU scheme

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A UK Government fund designed to replace EU regional development grants will leave the north of England tens of millions of pounds worse off while maintaining or even increasing funding to wealthier southern areas, the Byline Intelligence Team can reveal.

Oxfordshire will receive a 12% funding boost, funding for Hampshire and west Surrey will remain the same, while Berkshire faces a cut of just 4%. Meanwhile, Leeds will see a funding cut of 43%, Manchester 35%, Liverpool 34%, and the north-east of England 37% overall.

Cornwall and the Isles of Scilly, the largest per-person recipient of EU funding in England, also face a cut of 38%, from £214.4 million during the last three years of the EU fund to the £132 million planned for the next three years of the UK Government scheme.

The Shared Prosperity Fund, part of the Government’s ‘levelling up’ agenda – intended to reduce the disparities between different parts of the UK – will hand out £2.6 billion over the next three years, falling significantly short of the £1.5 billion per year the UK received from the EU to help its most deprived areas.

The 2019 Conservative manifesto promised “at a minimum” to match EU funding post-Brexit.

Under EU rules, funds were allocated according to an area’s deprivation in relation to the EU average. The new rules attempt to replicate this model, but also guarantee a minimum of £1 million for every borough and/or district in England.

The fund’s spending allocation has also ignited a row between the UK’s devolved nations and Westminster.

The Scottish Government has claimed that it will receive £337 million less over three years than it would have under the EU. The Welsh Government, meanwhile, has claimed that it is “facing a loss of more than £1 billion in un-replaced funding over the next three years”.

In a written statement, Welsh Minister for the Economy, Vaughan Gething, said: “The Welsh Government proposed an alternative formula which would distribute funding more fairly across Wales according to economic need, but this was rejected by the UK Government.”

Levelling Up Secretary Michael Gove has stated that the UK fund would only match EU funding in 2024/25 – once remaining EU funds had been distributed – noting that previous EU grants had “ramped up and down”.

However, the Financial Times has reported that English regions will receive £78 million less in real terms than under the EU deal, even when the UK Government scheme ramps up in 2024/25.

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Levelling Down

Levelling up is one of the key policy planks of Boris Johnson’s Government, linked to the UK’s departure from the EU.

Brexit has been viewed as a rebellion among former industrial areas in the north of England, the midlands and north Wales – protesting against their relative deprivation compared to more affluent areas of the country, in particular London and other metropolitan hubs.

However, two-and-a-half years after Johnson won the 2019 General Election, there appears to have been little movement on the agenda.

The Government launched its levelling up white paper in February, sketching out the scope of its ambitions. Yet, ministers were criticised at the time for failing to match their grand rhetoric with funding commitments. In a recent report, the Institute for Government think tank concluded that the Government’s 12 levelling up missions – stipulated in the white paper – will not have a positive impact on regional inequality.

The Institute said that “only four of the 12 missions are clear, ambitious and have appropriate metrics – outcomes the Government will measure to demonstrate progress towards its 2030 target”.

Meanwhile, the Conservative Party has been accused of distributing levelling up funds to further political ends.

Analysing the Government’s four existing levelling up schemes, the Guardian found imbalances and irregularities – not least that Mid Bedfordshire, an area partly represented by Culture Secretary Nadine Dorries, has received £26.7 million in funds despite being one of the fifth most affluent areas of the country.

Likewise, the constituency represented by Health and Social Care Secretary Sajid Javid will receive £15 million despite being one of the wealthiest areas in England.

This situation appears to have been replicated in the case of the Shared Prosperity Fund, with some Conservative-dominated areas escaping the worst of the Government’s cutbacks. Indeed, Oxfordshire – set to receive a levelling up funding boost – has six parliamentary constituencies, four of which are represented by Conservative MPs.

Raw funding has also been lacking, with Johnson planning to spend less on English regional development than either of his immediate predecessors, Theresa May and David Cameron, according to the Northern Powerhouse Partnership.

The Byline Intelligence Team recently revealed how the Conservative Government has been encouraging repressive regimes – including Saudi Arabia – to invest in regional development projects in the UK, as a means of furthering the levelling up agenda, and potentially as a way of avoiding central government spending.

“Levelling up is about addressing deep structural challenges over the long-term and the white paper sets out a clear blueprint on how we will reduce regional inequalities,” the Government said, in response to the Institute for Government's levelling up report.

This article was produced by the Byline Intelligence Team – a collaborative investigative project formed by Byline Times with The Citizens. If you would like to find out more about the Intelligence Team and how to fund its work, click on the button below.

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Hollow Monuments: The Reality of Boris Johnson’s Levelling Up Plan

Published by Anonymous (not verified) on Thu, 03/02/2022 - 2:29am in

Hollow MonumentsThe Reality of Boris Johnson’s Levelling Up Plan

The Prime Minister’s proposals for regional rebalancing show that he is more interested in building his personal legacy than improving lives, says Sam Bright

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It has been a week of vacuous reports in Westminster: the Sue Gray report on Monday, the details of which have been kept secret thanks to the Metropolitan Police, followed by the Government’s ‘Brexit benefits’ paper, and now the long-awaited white paper on ‘levelling up’ – released today.

The Gray report aside, these documents signal the current position of the Vote Leave project – which is now forced to wrestle with the fact that empty slogans, the likes of which won the 2016 EU Referendum and 2019 General Election, convert into empty policies.

This is the case with the levelling up white paper – the document that seeks to establish the form and nature of the Government’s attempts to address regional inequalities.

The Vote Leave campaign has been so successful in recent years because it diagnosed the causes of widespread anger in deprived areas of the country. The white paper extends this diagnosis, with Levelling Up Secretary Michael Gove introducing the document by saying: “For decades, too many communities have been overlooked and undervalued. As some areas have flourished, others have been left in a cycle of decline. The UK has been like a jet firing on only one engine.”

However, while the white paper points squarely at the problem, it does not point with such conviction at viable solutions – setting 12 vague ‘missions’ for levelling up, without a clear plan or sufficient funding.

Indeed, it is worth putting the Government’s levelling up commitments into context.

The four levelling up funds established by Boris Johnson’s administration have invested £4.7 billion so far – half the amount that the Government has written-off on duff personal protective equipment bought during the Coronavirus pandemic. The overall budget of the UK’s COVID ‘test and trace’ system is £37 billion, while Crossrail – the new, high-speed London train line – is expected to cost in excess of £15 billion.

In fact, Johnson plans to spend less on English regional development than either of his immediate predecessors, Theresa May and David Cameron, according to the Northern Powerhouse Partnership.

Henri Murison, who runs the think tank, says that much of the Government’s levelling up agenda will be fundamentally “undermined through a lack of funding”.


The Growing Regional Wealth GapWhy it Matters
Sam Bright

There is also a historical context to consider.

Byline Timesanalysis has indicated that ‘Red Wall’ areas saw their local budgets cut by 34.2% from 2010/11 to 2017/18 – as the Government implemented an austerity agenda that retrenched state spending – compared to an England-wide average of 28.6%.

This had a measurable and detrimental impact on the lives of people in these areas. From 2014/15 to 2019/20, for example, the percentage of children in poverty increased in Red Wall seats from 29.8% to 34.6% – a jump of 16%.

Thus, to a large degree, Johnson’s levelling up commitments are merely partially repairing the damage inflicted on left behind areas for the past 12 years. This is borne out by the data – 59 local authorities that benefitted cumulatively to the tune of £1.25 billion from the first round of the Government’s ‘Levelling Up Fund’ lost £25.5 billion in spending power after 2010.

Yet, raw funding is not the only issue. How the funding is applied, to which areas and projects, is equally important.

On this measure also, the Government’s plans are ill-conceived, concentrating on small-scale infrastructure projects that look good on the leaflets of local candidates – the regeneration of a town centre or the improvement of a train station – but have comparatively little economic impact.

Indeed, the National Audit Office (NAO) – the independent public spending watchdog – states that the sort of infrastructure projects funded by the Government’s levelling up plans “do not usually drive significant growth”.

The Department of Levelling Up, Housing and Communities “has not consistently applied knowledge and key policy principles”, the NAO added – and “has a limited understanding of what has worked well in previous local growth programmes due to a lack of consistent evaluation or monitoring”.

At best, the Government’s allocation of levelling up funds appears to be slapdash – at worst it’s an example of ‘pork barrel’ politics, with cash funnelled towards marginal and Conservative-held constituencies.

Analysing the Government’s four levelling up schemes, the Guardian found imbalances and irregularities – not least that Mid Bedfordshire, an area partly represented by Culture Secretary Nadine Dorries, has received £26.7 million in funds despite being one of the fifth most affluent areas of the country.

Likewise, the constituency represented by Health and Social Care Secretary Sajid Javid will receive £15 million despite being one of the wealthiest areas in England.

As concluded by Jonny Webb of the IPPR North think tank: “Forcing places to bid into centrally controlled pots of money, where outcomes are decided by an opaque criteria, is never going to level up”.

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Building an Emperor

Ultimately, levelling up is a political strategy, not a burning policy mission of Boris Johnson or his Government.

It helps the Conservatives in the short-term, by producing the content for its electoral campaigns. This was originally envisioned by Johnson’s former chief aide Dominic Cummings, who was reportedly asked to describe the plan for getting the Conservatives re-elected, and said “build sh*t in the north”.

But it also serves Johnson’s longer-term ambitions – erecting monuments that embody his political legacy. Perhaps that is why Cummings latched onto Johnson, believing that his vanity corresponded with a strategy that could win a general election.

However, interviewed recently by New York Magazine, Cummings has now seemingly tired of hollow monument-building. He told the publication that Johnson thinks “what would a Roman emperor do?” and that the Prime Minister fantasises about “monuments to him in an Augustine fashion”.

This has been a regular feature of Johnson’s political career – a trend that encompasses the failed ‘Garden Bridge’ proposed while he was Mayor of London, his desire to see London Bridge station decorated with gargoyles, and his rejected plan for an Irish Sea bridge.

None of these projects reached completion because they were wasteful and ill-conceived. Levelling up is merely a crystallisation of this Johnsonian impulse – to be remembered for having been in power, rather than for what he achieved thanks to it.

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The Growing Regional Wealth Gap and Why it Matters

Published by Anonymous (not verified) on Tue, 11/01/2022 - 2:00am in

The Growing Regional Wealth Gap& Why it Matters

Sam Bright evaluates new data showing a growing divide between richer and poorer parts of the country

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New data has been released by the Office for National Statistics (ONS) in recent days about the wealth gap between people living in different areas of the country.

The statistics haven’t generated much attention – even though they show burgeoning wealth inequalities between the richest and poorest regions.

The data reveals that average (median) wealth among individuals in the south-east of England (£236,000) was £157,000 higher than in the north-east (£79,000), between April 2018 and March 2020. Or, to put it another way, individual wealth in the north-east was just a third of individual wealth in the south-east.

What’s more, the ONS data shows that these wealth inequalities have been growing markedly in recent years. Indeed, the wealth divide between the south-east and north-east was £80,000 in nominal terms – or £92,000 after adjusting for inflation – in July 2010 to June 2012, meaning that the gap has roughly doubled over the past decade.

And the numbers are even starker in relation to household rather than individual wealth. Household wealth has increased in the south-east by 43% since 2006, now standing at £503,400 – compared to just £168,500 in the north-east.

These wealth inequalities are largely a product of the housing market, and the rapid inflation of property prices in the capital – and the wider south-east – in relation to the rest of the country. In 2020, the average house price in London stood at £497,000 – almost double the England-wide average of £262,000. In Yorkshire, the figure was £175,000, in the north-west £177,000, and £275,000 in the south-west.

This hyper-inflation has been persistent for decades, entrenching obscene wealth disparities between homeowners (and non-homeowners) in different regions.

In London, property inflation stood at 200% in the 1980s, more than 100% in the 2000s and more than 60% in the 2010s. Consequently, if one household bought a property in London for £50,000 in the early 1980s and another bought a house in Yorkshire for the same amount at the same time, the former would now be worth some £400,000 more than the latter (£770,000 in London versus £380,000 in Yorkshire).

This has, in turn, pumped up the London rental market. As of May 2021, the average rent in London was £1,583 a month, compared to a UK average of £997. Renters in north-west England were paying roughly half the amount required in the capital – at just £790 a month.


Why Johnson Isn’t Serious About‘Levelling Up’
Sam Bright

Why Does this Matter?

Place-based inequalities have grown under the radar in recent decades. Commentators on the left have continued to place emphasis on class divisions – the inequalities between rich and poor, regardless of geography – rather than inspecting how these disparities manifest within and between regions.

However, as recent elections (and referendums) have demonstrated, place-based grievances are increasingly important in understanding the political and social fabric of the UK.

The Conservative Party’s victory at the 2019 General Election, and Vote Leave’s success in 2016, were super-charged by a feeling of political and economic marginalisation among ‘left behind’ towns in the north of England, the Midlands and Wales. Similar resentments in Scotland nearly propelled it to independence in 2014, and have underwritten the SNP’s success in the country for the past decade.

The nation’s wealth continues to accumulate among a narrow cohort of the population living and/or trading in the south-east. However, the way in which this is occurring – through property inflation – is arbitrary and unfair. People working in the same professions, earning roughly the same wages and paying the same taxes, may be on the opposite ends of the wealth barometer – merely due to the location of their property.

Many people argue that these regional wealth gaps are insignificant, because the wealth of homeowners is relatively immobile. In other words: a person owning a home in London is likely to see little benefit from their property wealth, because they’re likely to stay in the London property market for years – buying another house that has inflated roughly at the same rate as theirs. They’re not able to improve their living conditions through the growth of their property wealth, because all properties in London are similarly over-priced.

However, the Coronavirus pandemic has changed this arithmetic. The normalisation of home-working has lowered the compulsion to live in the same place that you work – allowing property owners in the capital to liquidate their assets and venture beyond the confines of London. Indeed, Londoners bought homes outside the capital worth £27.6 billion in 2020, the largest amount spent since 2007.

This has a potentially corrupting effect on housing markets outside London – pushing up demand in areas with comparatively lower house prices and making it harder for local people to step onto the property ladder.

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The imbalanced inflation of property prices in the south-east also creates acute inter-generational inequalities. London property owners will eventually be able to pass down their assets to the next generation, dividing the wealth of the nation based on property inheritance. This is particularly significant given the concentration of income and opportunities in the capital; London represents a disproportionate 23% of national output, and its GDP per capita exceeds the England-wide average by some 40%.

Ergo, if your parents owned a property in London or the wider south-east, you are infinitely more likely to be able to afford a property in this part of the country – allowing you to take advantage of the riches afforded by our all-consuming capital.

Moreover, if London rental prices continue to outstrip the rest of the country, and if opportunities continue to be enclosed in the capital, vast inter-generational inequalities will widen between people in different regions. Moving down to London on a graduate salary is already prohibitively expensive; costs that are not suffered by Londoners who are able to live at home during the early years of their career.

If salaries further stagnate, as they have for the past 15 years, and London property prices continue to rise exponentially, young people outside the capital’s commuter belt will be locked out of the city that currently acts as the engine of the British economy. This process – which shows no signs of abating – violates the principles of fairness and equality of opportunity on which our economy and education system is ostensibly premised.

Regional inequality may not be the most popular injustice in modern Britain, but it is certainly one of the most profound.

Sam Bright’s book, ‘Fortress London: Why We Need to Save the Country From its Capital’, will be published this year

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The post The Growing Regional Wealth Gap and Why it Matters appeared first on Byline Times.