The Public Sector in the North: Driver or intruder? Paper 2 from the Northern Economic Agenda project

This report focuses on the public sector's impact on the economy of the three northern English regions. Does the scale of the public sector in the North, and the nature of the public sector reforms, drive or undermine the economic growth and prosperity of the regions?

It is often said that the public sector in the North is too big. We argue that the public and private sectors are not mutually exclusive entities. It is true that after decades of economic decline, deprivation and substantial public spending, the private sector in the North East, North West and Yorkshire and the Humber is still not strong enough to provide services in the areas where private actors should be most effective. The reduction of the share of the public sector spending and employment should be implemented not at the expense of the spending cuts. It should be done on the basis of expanding the private sector. And we believe that in this process the public sector has a new developmental role to play.