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The Progressive Policy Think Tank

The northern powerhouse rolls on, but lacks leadership

The northern powerhouse is 'a runaway train that increasingly needs a good driver'. However, instead of looking to Theresa May's new cabinet for direction, the North needs to solve its own leadership problem. That means overcoming regional and city-metro divides to embrace leadership at the widest, most stategic level, to enable the North to join Holyrood, Stormont and London's city hall at the Brexit negotiation table.

As Cameron and Osborne left Downing Street, many suspected the northern powerhouse bandwagon would be pushed into a siding. They couldn't have been more wrong – but it's a runaway train that increasingly needs a good driver.

In the narrowest of terms, the government has kept a minister for the northern powerhouse, so any desire that Theresa May might have had to expunge the Osborne legacy clearly didn’t extend that far. Andrew Percy, MP for Goole and Brigg, is a northern lad and will take to the role with much greater zeal and insight than his predecessor. More significantly, Lord Jim O’Neill stays as commercial secretary to the Treasury. O’Neill – the man known as Mr BRICs – has more recently remodelled himself as Mr Man-pool, and as a close ally of the former chancellor there’s no way he would have stayed had he thought that the new chancellor, Philip Hammond, wasn’t serious about the powerhouse agenda. Hammond himself moved quickly to allay any fears about transport investment with some clear statements about the government's commitment to HS2, and to enhancing Northern transport connectivity more generally.

It is also good news that Greg Clark MP was promoted from the Department for Communities and Local Government to a newly embellished Department for Business, Energy and Industrial Strategy. Bringing those three portfolios together makes a great deal of sense in the North, where we have for so long cried out for an industrial strategy that looks beyond the South East and sees energy not just as a national headache but as a key industrial asset and opportunity for northern futures. Giving the job to the government's chief architect of city devolution suggests a further realisation that the way to unleash the potential of British business is to empower combined authorities and local enterprise partnerships to drive local growth. But as the prime minister herself has suggested, devolution must go beyond one or two big cities like Manchester: the new communities minister, Sajid Javid, will have his hands full sorting out a new wave of stalled devo deals, not least just across the hills in Yorkshire.

But to think that the future of the northern powerhouse is dependent upon some changes in central government is to commit the most colossal category error.

The northern powerhouse is not – and must never be – seen only as a government programme. Many businesses have bemoaned its lack of definition; this vacuum is its greatest opportunity. Many have slammed it as empty rhetoric; this is to shoot ourselves in the foot. The northern powerhouse is nothing less than the combined economic power and potential of the 8 million people who work here and the 15 million people we serve. The Northern Powerhouse is not a game of Westminster deckchairs but a £300 billion economy competing on a global stage. And this is why the new government can’t resist its momentum.

Since the Brexit vote, this global competition has gotten a little harder. But one of the reasons that so many northerners voted to leave is that they were not persuaded that the Osborne agenda held anything much for them. This is what makes the task of reclaiming the northern powerhouse all the more important. It is interesting to note that it was in cities like Manchester and Liverpool where people voted to remain, albeit by small margins. Perhaps here the first fruits of devolution, local empowerment and a powerhouse premium are beginning to be realised and believed in. But those fruits need to be tasted much more widely, in the Burnleys and the Blackburns that currently sit outside of the city regions but whose economies are inextricably linked to the fortunes of their neighbours – their future, and Manchester’s, are staked on one another’s success.

But it is at times like these when it becomes so clear that in the North we have a leadership problem. Of course in Manchester we are the proud poster-boys of the devolution revolution (boys being the operative word!). And this brings us parochial success: a big fish in a small pond. But when cast out into the post-Brexit ocean and in the midst of a political storm, it has taken nearly two weeks for no fewer than 77 different northern leaders to come together to pen a letter to the new PM. In the meantime, Sadiq Khan has lined up his very best people to make sure London's interests are fully represented at the Brexit table and Nicola Sturgeon has welcomed Theresa May up to Scotland for face-to-face talks about Scotland’s tests for any Brexit deal. Even Northern Ireland has had head-to-head meetings with the new PM. Meanwhile, our letter sits in her in-tray while she tries to work out who to go and see without offending his or her neighbours.

Calls for a ‘Nicola for the North’ are often drowned out by local political interests who prefer to protect their own fiefdoms rather than seize the bigger prize. It is absolutely right that our city leaders – and our new metro mayors in particular – should seize the powers they need to continue to transform our great northern cities. But to deny the glaring gap in our governance at that wider, strategic level is to turn a blind eye to the collective potential – and the cries of anger – of 15 million people. Of course ‘the North’ remains a mish-mash of local accents and diverse identities; of course we need to tease out what else after transport is best dealt with at that pan-northern tier. But establishing a mandate and setting out shared priorities are the lifeblood of great political leadership, and right now, the North needs joined-up, visible leadership like never before.


This piece originally appeared in the Manchester Evening News' Greater Manchester Business Week supplement.