Looking North: the multi-level governance of economic policy

Debates on the state of regional inequalities in the UK date back decades. And yet, recent studies have clearly shown that these divides are widening even further, and the UK is now one of the most regionally unequal countries in the developed world (Raikes, Giovannini and Getzel, 2019; UK2070 2020; OECD 2020). The lack of a coherent industrial strategy, together with over-centralisation of power and resources by the government, have played a key role in this negative process (Raikes, 2019; Raikes, Giovannini and Getzel, 2019). And these two are related – unlike in other countries, the UK does not have the devolved institutions needed to develop industrial strategies (Raikes, 2019). While the effects of these overlapping dynamics are felt across the country, the North of England stands out as an area of particular interest. On the one hand, the North has been faring considerably less well than other parts of the UK in economic terms. On the other, however, the North’s economy is not inherently on a “negative spiral”; it has been held back by over-centralisation and patchy industrial and economic policy, but it also has the assets to reverse such trends and thrive (Raikes, 2019). It is no coincidence that the North cyclically (re-)emerges as a crucial area in national economic policy and in the debate on rebalancing the economy. The new government’s “levelling up” agenda is just the latest iteration of this process and has put, once again, the North under the spotlight. This time, however, there are also specific political interests at play, as the government owes its parliamentary majority to the fall of the so-called “Red Wall”, and to the votes that many northern constituencies have “lent” to the Conservatives. And yet, despite much rhetoric, it remains unclear whether and how Boris Johnson’s government will manage to tackle regional inequalities in a way that is sustainable, valuing both tradeable and foundational sectors of the economy, and gives the North the leverage it needs to take control of its own future. Against this background, the aim of this chapter is to assess the multi-level governance of economic policy in the North. To achieve this, we first offer an overview of the asset base and economic geography of the North of England, and we then shed light on the issues of scale that underpin the debate on industrial policy. After having made the case for a functioning system of multi-level governance to harness the North’s potential, we discuss how different tiers could work together, and how new governance structures could be made democratically legitimate – tapping also into issues of identity in the North. Finally, we look at devolution as a key policy to unlock the North’s potential, especially in the context of the new government’s Northern Powerhouse and “levelling up” agendas.