London: the limelight hogger

Andrew Adonis claims to be ‘deadly serious’ about his proposal to relocate the House of Lords to a midlands or northern city. London, he writes in a letter to the Spectator, is ‘New York, Washington and LA rolled into one, which is unhealthy for our national politics.’

Adonis is a clever chap. He knows full-well that his suggestion will be met by much harrumphing from his colleagues in the House of Lords. It’s not just Tory peers who like living in Sussex, Hampstead or Islington, and popping along to Westminster. He’ll probably get the same amount of ridicule as the BBC executive who first suggested moving the bulk of the BBC to disused docklands in Salford. One billion pounds later, there are still BBC types unhappy with the move north. Just imagine if the Lords ended up in Coventry, Warrington or Middlesbrough. There’d be apoplexy.

There is, of course, a serious point about the imbalance between the north and south. London and the south east remain the power-house of the economy. It rivals New York as a centre for finance, it has the third most visitors in the world, it has the world’s busiest airport, and over 40 universities. Over eight million people live in greater London, compared to one million in Birmingham and half a million in Manchester. In terms of size, population and GDP, no city in Britain is even in the same league as London, whether we like it or not.

Tony Benn, when a minister, famously had a map the United Kingdom hung upside down in his office to make the point that the UK is bigger than the south east of England, and there’s always another way of looking at things. If you look at the map, you can see that Edinburgh is only about half way up (or down) the United Kingdom.

It is desperately unhealthy for London to suck in all the wealth, jobs and business. In the industrial age, urban centres grew up around trades and industries, based on natural resources, climate and topography. Mother Nature determined where cities would thrive, be it the damp in Manchester, or the coals in Newcastle. The decline of the shipyards, ironworks and textile mills left the great cities denuded of their wealth, and only in recent years have they found post-industrial purpose. The renaissance of the great cities was yet another of Labour’s unsung achievements.

There is some doubt whether the state can successfully re-balance the economy through relocation of its functions and agencies. Central government has tried over the years – placing the DVLA in Swansea, the tax office in Southend, and the headquarters of the NHS in Leeds, for example. If you’re a senior official at Quarry House in Leeds, you spend a lot of time on the train to Kings Cross for meetings at the department of health. By January this year, of the 680 jobs created at the BBC Media City in Salford, only 28 went to people with a Salford postcode.

Even attempts to hold Cabinet meetings outside of London, promoted by Hazel Blears when she was a Cabinet minister, have met with resistance. The Tories have copied the idea, but not without grumbles from ministers. And try getting the permanent secretaries to hold their weekly session outside the M25. When Labour encouraged them to meet in east London (Stratford, I think it was) you would think we’d suggested Sarajevo.

Governments can show willing, by forcing civil servants to live in Peterborough, but in the end it will come down to the private sector. With a knowledge and skills-based economy, there is no reason for all the corporate HQs and new jobs have to be within two miles of the London Eye, any more than they have to be within spitting distance of a coalfield or cotton mill.

Britain needs a strong regional policy, with the right mix of incentives, tax breaks and public investment to make business relocation or start-up outside London a runner. One of the Tories earliest, and biggest, mistakes was to scrap the regional development agencies which helped business thrive across the UK. The local enterprise partnerships (LEPs) that replaced the RDAs have created a patchwork quilt, not a national strategic structure. An incoming Labour government will need to create strong regional bodies to attract investment from private firms.

Relocation of the House of Lords is a good step in the re-balancing of Britain. But until we have an economic secretary to the treasury who knows where Sunderland is in relation to Bolton, and a prime minister who can tell the difference between Liverpool and Leeds, London will continue to hog the limelight.