Adonis's review should galvanise the North East and its neighbours

While the coalition dithers on its growth strategy, the Labour peer has set out precisely the rebalancing the nation needs to recover from the crash.

The launch of the North East Independent Economic Review, chaired by Andrew Adonis, provides further evidence that while the government dithers on economic growth strategy, others are prepared to set out their stalls. First Heseltine, then the Northern Economic Futures Commission and now Adonis all point to the importance of local and regional economies in returning the nation to prosperity.

Adonis sets out a North East vision comprised of "making, trading and exporting" – precisely the rebalancing the nation needs to recover from an economic shock which started in the financial sector but which has had its greatest impact in the north. It calls for the creation of 60,000 private sector jobs and makes clear that the north east has some key competitive advantages to enable that rebalancing and job creation to happen if only opportunities can be unlocked.

The review makes proposals to boost exports and supply chains and co-ordinate inward investment activities through the formation of North East International, it calls for a North East Innovation Board to oversee the development of key innovation centres in life sciences, automotive manufacture and offshore engineering, and it makes the case for a regional business bank and a successor body for the NE JEREMIE, European and social enterprise funds overseen by a NE Investment and Finance Board. In many ways this puts back together again some of the functions that were once carried out by the regional development agency but with a fresh purpose and momentum.

Skills, widely accepted to be critical to driving growth in regions like the North East, also have a key role in the plan with proposals for a North East Schools Challenge, a doubling of the numbers of youth apprenticeships, increasing number of young people in higher education by 1 per cent per annum and a payment-by-results component for local training providers. It also calls for a strategic plan for transport and a NE Infrastructure Fund to fund a series of key priorities including smartcard ticketing, the A1 Western Bypass and A19 developments, and a series of rail improvements including to maximise freight potential. These should be led by a new body: Transport North East.

All of the proposals are sensible and progressive and emphasise what the North East can do for itself if it can now get its act together, establish the Combined Authority it has recently announced, and come up with a delivery plan that turns aspiration into action. Three questions, though, remain.

First, there is the matter of scale. While many measures make sense at the North East level and require the kind of co-ordination that Adonis has proposed, there are a few where the North East will have to work more collaboratively beyond its borders to maximise its potential. On inward investment, innovation and transport in particular, North Eastern activities need to be quickly integrated with activity taking place in Tees Valley but perhaps, more importantly, with other Northern LEPs. For example, Transport North East will only be able to achieve its objectives of faster journey times between key cities if it quickly gets behind plans to decentralise the Northern Rail and Transpennine franchises being organised by the emergent 'Transport for the North' collaboration.

Second, there is central government. Adonis is right not to be too demanding and let Heseltine do the heavy-lifting in this regard, but in most aspects of the review, some central government leniency will be required to allow proposals the freedom – and investment – to really take off. Changes to the national FDI system, University Technical Colleges, locating the British Investment bank in the North East would all be cases in point but long term fiscal autonomy and much greater economic decentralisation must be the wider goals for all Northern LEPs and these will only be achieved with a wider Northern voice.

Finally, there is the question of time. With the Financial Times reporting that places such as Sunderland will be £618 per person worse off than before as a result of welfare changes, one wonders whether any plan of this nature can offset such a hit to the local economy. Clearly there is a very real sense that things can only get worse before they get better, but Adonis and his review team have put together a coherent plan and for now it’s the only game in town.

Ed Cox is director of IPPR North

@edcox_ippr

Labour peer and former transport secretary Andrew Adonis.

Ed Cox is Director at IPPR North. He tweets @edcox_ippr.

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Who will win in Manchester Gorton?

Will Labour lose in Manchester Gorton?

The death of Gerald Kaufman will trigger a by-election in his Manchester Gorton seat, which has been Labour-held since 1935.

Coming so soon after the disappointing results in Copeland – where the seat was lost to the Tories – and Stoke – where the party lost vote share – some overly excitable commentators are talking up the possibility of an upset in the Manchester seat.

But Gorton is very different to Stoke-on-Trent and to Copeland. The Labour lead is 56 points, compared to 16.5 points in Stoke-on-Trent and 6.5 points in Copeland. (As I’ve written before and will doubtless write again, it’s much more instructive to talk about vote share rather than vote numbers in British elections. Most of the country tends to vote in the same way even if they vote at different volumes.)

That 47 per cent of the seat's residents come from a non-white background and that the Labour party holds every council seat in the constituency only adds to the party's strong position here. 

But that doesn’t mean that there is no interest to be had in the contest at all. That the seat voted heavily to remain in the European Union – around 65 per cent according to Chris Hanretty’s estimates – will provide a glimmer of hope to the Liberal Democrats that they can finish a strong second, as they did consistently from 1992 to 2010, before slumping to fifth in 2015.

How they do in second place will inform how jittery Labour MPs with smaller majorities and a history of Liberal Democrat activity are about Labour’s embrace of Brexit.

They also have a narrow chance of becoming competitive should Labour’s selection turn acrimonious. The seat has been in special measures since 2004, which means the selection will be run by the party’s national executive committee, though several local candidates are tipped to run, with Afzal Khan,  a local MEP, and Julie Reid, a local councillor, both expected to run for the vacant seats.

It’s highly unlikely but if the selection occurs in a way that irritates the local party or provokes serious local in-fighting, you can just about see how the Liberal Democrats give everyone a surprise. But it’s about as likely as the United States men landing on Mars any time soon – plausible, but far-fetched. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.