James Ransom

February 2, 2022

The next White Paper arriving in the UK is the delayed Department for Levelling Up strategy calling at the red wall, ‘left behind’ places, and forgotten communities

First thoughts on the government’s flagship Levelling Up White Paper. No further train analogies. This post originally appeared on the NCEE website.

The government published the Levelling Up White Paper today. Given the delays (the paper was expected last year) much ink has been spilled on what it should say. Most agree the challenge is immense: as Professor Philip McCann observes, ‘no other large industrialised country faces such productivity inequalities over such a tiny space’. Most also welcome a focus on tackling some of the long-standing structural issues facing our society. These issues have a very human side: recent work has explored feelings of trauma and grief felt by people whose local industries have collapsed in ‘left behind’ places.

Much will be written in the coming days on whether the white paper goes far enough to meet this challenge. My initial impression is that it makes the right noises in terms of the mechanisms to make this happen – a roadmap for devolution across England, a focus on ‘system’ change cutting across government departments, and adopting a mission-led approach to tackling an incredibly complex challenge. But the lack of any substantial new financial muscle underpinning this is worrying, especially if local councils are expected to do more at a time when many are reeling under financial pressure. Here are a few other quick observations.

Research and development

One mission is for domestic public R&D investment outside the Greater South East to increase by at least 40% by 2030. This is accompanied by a commitment from the Department for Business, Energy and Industrial Strategy to invest at least 55% of their domestic R&D funding outside the region by 2024-25. This welcome announcement follows hints dropped in the government’s innovation strategy and spending review, and numerous influential policy reports over the past few years, not least Nesta’s on the missing £4 billion. Historic underfunding in some regions has led to inequalities in economic performance across the UK. New Innovation Accelerators, ‘major place-based centres of innovation’, in Greater Manchester, the West Midlands, and Glasgow-City Region are a further step to reversing this damage. They need substantial funding: will £100m between three be enough – particularly if they aim to follow the university-centred models of MIT-Greater Boston and Stanford-Silicon Valley? Evidence suggests this is a very challenging ambition.

Tracking progress

The influence of Neil O’Brien MP, Boris Johnson’s Levelling Up Adviser and head of the No. 10/Cabinet Office Unit leading on levelling up, is clear. O’Brien was involved in Nesta’s report on the missing £4 billion, but has also written extensively in the past on how progress on levelling up should be measured. Sure enough, missions will be ‘underpinned by a suite of public metrics to track progress and monitor the evolution of spatial disparities’. There will be an annual report updating the public on the progress of these missions and an advisory council, including academics, will provide ‘further support and constructive analysis’. This data will need to be very carefully tuned to capture the right information, and it will need to be sufficiently granular to be useful to local places (remembering, of course, that some of the most uneven places are within the Greater South East). But, again, this is a welcome move.

Business, spin-offs and SMEs

Local businesses, spin-offs and SMEs will drive the success of the new innovation clusters and the Shared Prosperity Fund, generating new ideas and technologies, providing jobs, and helping regenerate local areas. Universities play a key role in supporting these enterprises. But the UK’s highly centralised economic geography hurts businesses in higher education cold spots. Research shows businesses located a greater geographic distance from universities employ fewer skilled workers and are less effectively managed. And will the £2.6 billion in the Shared Prosperity Fund to replace EU structural funds be enough for all parts of the UK, in particular those nations and regions designated as less developed or transitioning under the EU programme?

Universities need to be proactive in bridging these gaps. Our forthcoming leadership survey report confirms that universities take this agenda seriously: developing new local partnerships and collaborations ranks fourth (out of 17 priorities) in terms of how important activities are likely to be over the next couple of years. At NCEE, we are launching a new programme of enterprise work, and stand ready to support the sector to help local areas prosper.