Growth figures mean nothing if you live in part of the country that's not growing

Rather than hyperbole over a national growth figure, we need regionalised figures to show how prosperity is unevenly spread.

The politics of the quarterly growth figures underpin a narrative that either says "things are getting better, "we were right", or "things are getting worse, you were wrong", depending on whether you’re George Osborne of Ed Balls. So this morning’s announcement that growth in the last quarter of 2013 was 0.7 per cent - with growth estimated at 1.9 per cent overall last year - allows the Chancellor to crow that there is "more evidence that our long-term economic plan is working."

But this is an aggregated national figure which disguises what is happening around the country. We only have to look at Monday’s report from the Centre for Cities think tank to see that not every part of the UK is jumping for joy. It exposes a massive, jaw-dropping imbalance in the economy, with London accounting for four out of every five jobs created in the private sector from 2010-12.

So rather than hyperbole over a national growth figure, we instead need regionalised figures to show how prosperity is unevenly spread. And we need the debate about the economy refocused around how we narrow these fluctuations. Instead of London and the south east booming and parts of the rest of the country being left in the deep freeze, we need to see London’s over-heated economy cooled and our regional economies thawed.

This is essential if One Nation politics is to mean anything. London is buoyed on a sea of public cash, with everything from civil service jobs through to public transport subsidies locking-in massive regional economic inequalities. The Centre for Cities report shows that not only is London dominating private sector jobs growth, but public sector employment too. While Birmingham lost 9,300 public sector jobs between 2010-12, London actually gained 66,300.

These advantages need to levelled-out to spread wealth and opportunity further, helping the national economy work better and become less reliant on London, but also making London’s economy more rational in the process. Indeed, with house prices in the capital now soaring, ordinary Londoners would benefit from some economic rebalancing. In the 12 months to November 2012, London’s property prices rose, on average, by 11.6 per cent. In contrast, they rose by just 0.6 per cent in the north west.

We did have regional economic strategies in place until this government scrapped the regional development agencies in 2010. This time, however, the task of narrowing economic disparities needs to sit at the heart of Treasury policy-making. Every lever of policy should be looking to release opportunity across the UK, utilising underused capacity across the country and spreading prosperity, particularly in terms of private sector investment, as widely as possible.

Rather than government and opposition pouncing on quarterly growth figures as evidence for their conflicting accounts of the state of the economy, it would be far better to have a regionalised breakdown so that we can start to have an honest, evidence-based discussion about the state of the real economy.

A man walks past boarded up shops in Bristol. Photograph: Getty Images.

Kevin Meagher is associate editor of Labour Uncut and a former special adviser at the Northern Ireland office. 

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Will Euroscepticism prove an unbeatable advantage in the Conservative leadership race?

Conservative members who are eager for Brexit are still searching for a heavyweight champion - and they could yet inherit the earth.

Put your money on Liam Fox? The former Defence Secretary has been given a boost by the news that ConservativeHome’s rolling survey of party members preferences for the next Conservative leader. Jeremy Wilson at BusinessInsider and James Millar at the Sunday Post have both tipped Fox for the top job.

Are they right? The expectation among Conservative MPs is that there will be several candidates from the Tory right: Dominic Raab, Priti Patel and potentially Owen Paterson could all be candidates, while Boris Johnson, in the words of one: “rides both horses – is he the candidate of the left, of the right, or both?”

MPs will whittle down the field of candidates to a top two, who will then be voted on by the membership.  (As Graham Brady, chair of the 1922 Committee, notes in his interview with my colleague George Eaton, Conservative MPs could choose to offer a wider field if they so desired, but would be unlikely to surrender more power to party activists.)

The extreme likelihood is that that contest will be between two candidates: George Osborne and not-George Osborne.  “We know that the Chancellor has a bye to the final,” one minister observes, “But once you’re in the final – well, then it’s anyone’s game.”

Could “not-George Osborne” be Liam Fox? Well, the difficulty, as one MP observes, is we don’t really know what the Conservative leadership election is about:

“We don’t even know what the questions are to which the candidates will attempt to present themselves as the answer. Usually, that question would be: who can win us the election? But now that Labour have Corbyn, that question is taken care of.”

So what’s the question that MPs will be asking? We simply don’t know – and it may be that they come to a very different conclusion to their members, just as in 2001, when Ken Clarke won among MPs – before being defeated in a landslide by Conservative activists.

Much depends not only on the outcome of the European referendum, but also on its conduct. If the contest is particularly bruising, it may be that MPs are looking for a candidate who will “heal and settle”, in the words of one. That would disadvantage Fox, who will likely be a combative presence in the European referendum, and could benefit Boris Johnson, who, as one MP put it, “rides both horses” and will be less intimately linked with the referendum and its outcome than Osborne.

But equally, it could be that Euroscepticism proves to be a less powerful card than we currently expect. Ignoring the not inconsiderable organisational hurdles that have to be cleared to beat Theresa May, Boris Johnson, and potentially any or all of the “next generation” of Sajid Javid, Nicky Morgan or Stephen Crabb, we simply don’t know what the reaction of Conservative members to the In-Out referendum will be.

Firstly, there’s a non-trivial possibility that Leave could still win, despite its difficulties at centre-forward. The incentive to “reward” an Outer will be smaller. But if Britain votes to Remain – and if that vote is seen by Conservative members as the result of “dirty tricks” by the Conservative leadership – it could be that many members, far from sticking around for another three to four years to vote in the election, simply decide to leave. The last time that Cameron went against the dearest instincts of many of his party grassroots, the result was victory for the Prime Minister – and an activist base that, as the result of defections to Ukip and cancelled membership fees, is more socially liberal and more sympathetic to Cameron than it was before. Don’t forget that, for all the worry about “entryism” in the Labour leadership, it was “exitism” – of Labour members who supported David Miliband and liked the New Labour years  - that shifted that party towards Jeremy Corbyn.

It could be that if – as Brady predicts in this week’s New Statesman – the final two is an Inner and an Outer, the Eurosceptic candidate finds that the members who might have backed them are simply no longer around.

It comes back to the biggest known unknown in the race to succeed Cameron: Conservative members. For the first time in British political history, a Prime Minister will be chosen, not by MPs with an electoral mandate of their own or by voters at a general election but by an entirelyself-selecting group: party members. And we simply don't know enough about what they feel - yet. 

Stephen Bush is editor of the Staggers, the New Statesman’s political blog. He usually writes about politics.