For the northern powerhouse to narrow the economic divide with the South, dynamic planning and investment on governance and transport will be needed from the get-go

Richard McCarthy

If the North is ever going to narrow the economic gap with the South, we need to create a new “northern powerhouse”. To achieve this, we will need to meet the complex mix of common interests while at the same time recognising the different needs of local identities within that region. Wigan is not Wakefield. Bury and Barnsley share some qualities, but are divided by others.

The northern powerhouse has to harness both the shared interests of the region and the unique local characters within it - while recognising that its competitors lie beyond the region and not within it.

This will require sustained investment in the physical, social and economic infrastructure that underpins employment and a high quality of life. To achieve this, we must first identify the factors behind London and the South-east’s enviable success and pinpoint what needs to be done to replicate these.

Essentially they are four-fold. First, a dense web of transport connections that are reliable and affordable. Second, consistent and cohesive governance with the ability to plan over the medium- to long-term over the whole economic area. Third, access to Europe as a key market for goods, services and talent; and finally, quality of life and opportunities to broaden experiences.

However, without a detailed, carefully considered plan for a northern giant, the pressures in the South-east will become less sustainable and the consequences for social and economic inclusion, community cohesion and economic growth, intolerable.

So how do you ensure that this northern powerhouse thrives? It would be, after all, a city region spanning multiple cities, a factor which, alongside the physical barrier of the Pennines, comes with huge challenges: local identities and loyalties, costs and technical obstacles.

The northern powerhouse has to harness both the shared interests of the region and the unique local characters within it

A sense of community is imperative. The northern powerhouse will become a city region that surrounds a national park, and with areas of brownfield land available for new development. Equally there are great cultural facilities - from the Deep in Hull to the Tate in Liverpool. The question is how can these be accessed across the city region and become part of a shared experience, building a regional identity?

Connectivity is crucial: physical links by road and rail that enable people to move freely within the conurbation are one major factor in London’s economic success. HS2 will make a difference to North-South travel, but without corresponding investment in East-West links - be it HS3 or upgrades to current trans-Pennine routes - the full benefits in the North will not be realised.

Political leadership is also a critical factor in driving investment - clearly demonstrated by the City Deals in northern cities, where clear leadership is being recognised by access to enhanced resources.

As Siemens’ Juergen Maier pointed out at the Northern Powerhouse Conference, if every devolved region does its own thing it would be the worst possible scenario. We need a national industrial strategy where we agree which regions are going to take ownership of which areas, to create world-class clusters that reflect local entrepreneurship, skills and resources.

If there is real intent to achieve this rebalancing, governance and transport are the crucial factors. These could include:

  • A single elected body or extended combined authority with a city-region manager on a five-year term for the entire area, extending beyond Greater Manchester which gets a mayor in 2017.
  • A coherent and integrated economic and transport strategy that develops and sustains clusters of activity across the northern powerhouse which are distinct.
  • A high-speed rail link from the Mersey, with its promise of a rejuvenated, privately funded port, across to the Humber with a direct link to Lille that allows European rolling stock to use UK railways.
  • Reopening old transport links for turn-up-and-go services that are clean, efficient and affordable.
  • Using renewable energy to power transport, investing in community-owned assets that provide a return to create neighbourhood-level investment.
  • Enabling and empowering municipal enterprise to drive development and investment.

This cannot happen without imaginative and dynamic planning and investment across all sectors. There are also parallels with the economic convergence programmes implemented by the EU in countries pre- and post-accession, developing the institutions and processes necessary to make best use of the investment. This is a programme that lasts beyond the horizons of any government. The North is rising again, but it may take a generation to deliver the level of change required to unlock its true potential.

Richard McCarthy is executive director, central government, at Capita