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Levelling Up Minister Neil O’Brien on the Prime Minister’s uncertain future

Neil O'Brien on regional development, the "changed" Conservative Party, and whether levelling up will outlast Boris Johnson

By Jonny Ball

Throughout the 2019 election, aside from the promise to fulfil the ubiquitous “Get Brexit Done” slogan, a new, more amorphous term could often be heard repeated on Boris Johnson’s election trail as a central plank of the Conservative offer – “levelling up”.

From the outset, it was elusive, a phrase that could mean many things to many men, but it always implied most strongly a rebalancing of wealth and power towards the “left-behind” regions of the UK – to places outside of London and the south-east battered by deindustrialisation, underinvestment, and a concentration of political power in Whitehall. The phrase has been roundly criticised for its imprecision and lack of substance. In July of last year, parliament’s business, energy and industrial strategy committee said that the levelling-up agenda risked “becoming an everything and nothing policy”. Dominic Cummings, the Prime Minister’s former chief adviser, described it as “vacuous”. And it has been mocked by opposition figures as “a slogan in search of a policy”, in the tradition of David Cameron’s long-forgotten “Big Society”.

Neil O’Brien, the Minister for Levelling Up, wants to dispel those doubts. A state-educated northerner, he once might have cut a lonely figure on the Tory benches, but his trajectory in some ways mirrors that of his contemporary party. He worked for the “no” campaign against Britain joining the euro and founded a Eurosceptic think tank. He served as special adviser to both George Osborne and Theresa May. A civil servant who has worked with him told Spotlight that he was “a thoughtful guy” and “an intellectual”, well-liked by colleagues in the department. Having entered parliament in 2017, he wrote an influential pamphlet, Firing On All Cylinders, which advocated for many of the policy aims then adopted by Johnson’s Conservatives: looser fiscal policy, higher investment, a more geographically balanced economy, and an ambition to boost incomes (although success on at least the latter front looks set to be woefully hampered by rampant inflation).

“There is a change in the Conservative Party,” he tells Spotlight. The Harborough MP, appointed to the Department for Levelling Up, Housing and Communities in September 2021, is keen to explain the rationale behind Levelling Up the United Kingdom, the long-delayed white paper published in February of this year. “There are a lot of changes in the fundamentals of politics in the UK and indeed in other countries,” he says.

Less than a decade ago it would have been unthinkable for many working-class seats in the Midlands and the north to return Conservative candidates to Westminster. Peter Mandelson, when MP for Hartlepool at the height of New Labour’s powers, once told a cabinet colleague that his “preoccupation with the working-class vote” was wrong-headed because those voters had “nowhere else to go”. He was wrong. Hartlepool is now a Conservative seat, and the left now struggles to make gains outside of large cities, with its core demographic having shifted away from the struggling heartlands and towards younger, more diverse metropolitan centres with more dynamic economies.

The average salary in 2019’s new Conservative seats is lower than the average in Labour seats, O’Brien says. Labour’s only gain in that election was the wealthy London suburb of Putney. The Conservatives won swathes of former coalfields, sites of the 1984 miners’ strike, where traditional industries and trade unionism once held sway. The December 2019 election represented the high point in the narrative of a new blue-collar conservatism, one that was less Thatcherite, more comfortable with expansionary fiscal policy, and more communitarian. “There’s a huge change socially in the politics of Britain, like other Western countries, and I think we’re responding to that. The levelling-up agenda is definitely responding to that,” O’Brien adds. Across the Western world, parties of the left are increasingly seen as a vehicle for the grievances of a growing graduate class that the celebrated economist Thomas Piketty has christened the “Brahmin left”. Accompanying that shift are parallel phenomena on the right: of populist Republicanism in the US Rust Belt, of former leftist bastions in post-industrial France opting for far-right insurgents, as well as the decline in support for traditional parties of social democracy across all of Europe. These were the “morbid symptoms” identified by the Levelling Up Secretary Michael Gove as products of the financial crisis and globalisation “eroding social solidarity”. O’Brien sees levelling up as the flagship Tory agenda for these new times.

The problem is, according to many experts, for all the lofty ambitions of the white paper, and for all the clear-cut diagnoses of Britain’s deep-rooted regional imbalances, the policy substance and resources needed to successfully achieve its aims seem to be sorely lacking.

“The problem is so vast, you need a massive bazooka to make a dent in it,” O’Brien admits. But the white paper, padded out with case studies of Renaissance Italy and a potted history of the Industrial Revolution, offers up a mix of already announced policies from across government, a re-announced alphabet soup of centrally controlled funding pots for local authorities, a renewed commitment to devolution and more elected mayors, and reforms to the way R&D spending, arts and culture grants, and public procurement are administered by SW1 mandarins.

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Twelve “missions” set out a broad range of objectives encompassing a drop in neighbourhood crime, a rise in healthy life expectancy, and an increase in pay and productivity. In these three areas, at least, the government has a mountain to climb of its very own making: since 2010, the UK’s productivity growth has lagged far behind all of its G7 rivals and we’re about to enter the biggest squeeze in living standards in six decades; life expectancy has stagnated and even fallen in some years (many health researchers say this is a result of spending cuts); and the government’s plan for 20,000 police officers merely reverses the reductions imposed on the force in the past 12 years.

Paul Johnson, the director of the Institute for Fiscal Studies, has said that there is “little detail” on how most of the white paper’s 12 missions will be met, with even “less detail on available funding”. The Centre for Cities think tank has compared levelling up to German reunification after the fall of the Berlin Wall, adding that the true cost of narrowing the gap between Britain’s regions would run into the trillions. Michael Marmot, author of the Marmot Review into health inequalities, has said that the resources attached to levelling up were “tiny” compared with “the scale of the problem”. And even before its publication, The i newspaper reported a government insider as saying “everyone, including the Secretary of State, thinks it’s shit”.

Not for the first time, the inclusion of heftier funds is said to have been blocked by the fiscally conservative Chancellor, Rishi Sunak, and a Treasury that frets about levels of borrowing while imposing an arbitrary 3 per cent of GDP limit on public investment.

Predictably, O’Brien is defensive of the whole agenda. “It’s really not just about spending,” he says. “It is about structurally trying to do things in a different way.” The white paper renews the government’s commitment to new devolution deals and directly elected mayors for counties as well as large cities. “We came into a situation in 2010 where the only part of England that had a devolution deal was London,” he adds. Since then, metro mayors like Andy Burnham have proliferated, acting as ambassadors for their locales on the national and international stages.

O’Brien describes it as his “obsession” to instill a comprehensive, whole-of-government approach to levelling up across departments. “I am a genuine believer in this having an economic argument for it, as well as a kind of social justice-y, political argument,” he says. “I do think that you would have a stronger economy overall if you could end the situation where you have one part of the country that’s massively overheating and you can’t afford a house, and other parts that are really lacking and where assets are neglected.” He dismisses accusations that the multiple policy areas, ad hoc, one-off budgets, and scattered departmental initiatives in the white paper amount to thin gruel: “Instead of looking at an individual fund and saying that this isn’t much in the totality of public spending, look at the combination of all these different things – the City Region Sustainable Transport Settlements (CRSTS) are worth nearly £6bn, the Integrated Rail Plan (IRP) was £96bn, there’s £4.8bn for the Leveling Up Fund (LUF), £2.6bn for the Shared Prosperity Fund (SPF), £3.6bn for the Towns Fund.”

All of this funding is to be welcomed, as is the promise to ensure government subsidies are spread more evenly outside the traditional R&D “golden triangle” of Oxford, Cambridge and London, and the large arts and culture institutions in the capital. Extra money will always come as a relief to many local bodies that have been squeezed by over a decade of austerity. Indeed, as O’Brien points out, government spending “is growing in real terms pretty dramatically”, with public spending, the total tax burden and capital investment all reaching a proportion of GDP not seen in a generation. But much of the £96bn earmarked for the IRP last year, announced two months before the Levelling Up white paper, was already spoken for. It was taken up by the first stage of HS2 between London and Birmingham (the remainder of the plans had been diluted and fell short of what had been originally promised). Similarly, the SPF replaces the regional grants that were once paid by the EU, and largely replicates its methodology.

The list of funding pots O’Brien lists represent only a fraction of those mentioned in the white paper, along with plans for broadband roll-out and a fan-led review of football governance. To these he adds two more separate policies: “changes to the Universal Credit taper rate, where you’re keeping £1,000 more – that’s a levelling-up measure; the increase in the National Living Wage to being one of the highest minimum wages anywhere in the world – that’s a levelling-up measure”. Generously, one might say levelling up is the singular focus of a government that is implementing a broad but strategic, multi-pronged approach across all of its ministries. More cynically, one might counter that it lacks focus, and that its failure to prioritise will mean that the business, energy and industrial strategy committee’s contention that it is an “everything and nothing” policy will likely be proven accurate.

More dangerous for the whole project may be the perilous situation in which Boris Johnson finds himself after what will likely prove to be a disastrous set of local election results in the wake of “Partygate” and an accelerating cost-of-living crisis. The whole impetus behind the levelling-up agenda could be lost to a newcomer in No 10 with less of a taste for devolution, a predilection for more austere budgets, someone with a more “true blue” complexion and a lack of commitment to the Conservative Party’s new demographics. Levelling up could, in just a few months, fall by the wayside of priorities under a new premiership, going the same way as the Northern Way, Urban Development Corporations or English Partnerships – all well-meaning regional initiatives lost to Westminster’s constant policy churn. “I just don’t think he’s going anywhere,” O’Brien insists in response. “I expect him to still be there. So I don’t buy the premise… I’m afraid.”

With looming economic and political crises on the horizon, we will soon find out how widespread the commitment to levelling up really is.

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