With the election out of the way and Brexit firmly on the horizon, Boris continues talk on his election pledge to increase investment in the North of England and Midlands, in a bid to boost economic growth and prosperity. Sheffield and Derby both look prime for relocating and recalibrating Government resource and investment decisions.
UK regional inequality is amongst the worst in the developed world and is a problem that successive governments have been grappling with for many years. Stark disparities in economic performance across the country have been an issue for some time and is the split is growing according to the latest regional output data released by ONS in December.
It is understood that HM Treasury could make wholesale changes to the way in which public investment is allocated to key economic growth interventions across the country, with value for money and economic appraisal assessments (as guided by the Treasury’s ‘Green Book’ guidance for nearly half a century) recast to focus explicitly on boosting economic wellbeing in the North and Midlands.
This could affect future national government investment decisions in a range of transport, infrastructure and business growth projects, shifting the focus away from national economic growth outcomes (and overall scale of economic benefit) towards reducing inequality and the ‘productivity gap’ between northern and southern England.
Further detail is expected in the Spring Budget – but on the face of it, these proposals could have a significant impact upon the location of government resources and funding available to stimulate and encourage economic growth.
It should see greater investment in cities outside of London including both the Yorkshire and Humber and East Midland’s regions. With the Northern Powerhouse still pushing for significant investment and changes in the power key areas have over their budgets, 2020 will be an interesting year for investment outside of London and the South East.