John Pugh MP writes… Grim up north

You may have read the Observer article entitled “Northern Lib Dem MPs rebel over cuts.”

It’s a source of wry amusement to behold how the national media treat our internal democratic procedures. Not since primary school have I been referred to as “ringleader”, let alone of a bunch of “rebels” – Northern council leaders, peers and MPs who endorse the pre-budget submission “Grim up North?”.

The title is meant to be a little ironic because there are many promising signs up North and a lot of support for the Coalition’s objectives of re-balancing the economy.

However, your typical Northerner is classically known for calling ‘a spade a spade’ or even ‘a shovel’, and it hasn’t passed our notice that the north has done more than its fair share of heavy lifting when it comes to deficit reduction. The biggest departmental cuts are in local government and the biggest cuts in local government are in the North.

Regional Growth Funds, City  and Local Growth Deals etc. are welcome and usefully spent, but we would be foolish to claim that they wholly replace the funds the Regional Development Agencies had or equal the sums that Lord Heseltine said were needed to rebalance the lop-sided British economy.

There remains currently a gap between our aspirations and achievement not helped by the collapse in capital spending in 2012. More money spent on economic regeneration, skills and transport in the North means less money spent on welfare bailouts in the North. Historically ,however, the way money spent by Whitehall departments has betrayed an institutional metropolitan bias and, like most sorts of institutional bias (sexism, racism etc), it is almost unconscious.

I am not going to rehearse the arguments of “Grim Up North”. You can find them here.

What I will say is that the Liberal Democrats have much to gain from championing the North and not conceding ground to Labour who seem to wallow in dependency and deprivation.

However, that means using the budget process in 2014, 2015 and beyond to the shift the pattern of public expenditure and we make no apology for saying so.

* John Pugh was Liberal Democrat MP for Southport until 2017 and was elected as a Councillor for the Dukes ward of Sefton Borough Council on 2 November 2017.

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32 Comments

  • Important points well made. That more focus is paid to the south-east is almost inevitable given that it is where media, politics and finance are most concentrated in the UK. But as a party that believes in challenging the status quo and devolving and decentralising power it is vital we make the case that Grim Up North? rightly makes.

  • I have to say John you’ve shown startling naivity if you gave this report to the media and expected any other outcome. While it’s important that Northern leaders continue to lobby for their areas, the publication of a report like this was always going to be selectively used by Labour to fuel their own myths about the North.

  • Tony Greaves 10th Mar '14 - 3:46pm

    Myths? The North of England was abandoned by this government in the first two years, and it’s a long slow and difficult process to start to rebuild anything worthy of the name of a regional policy. The way that the local government funding cuts have slashed spending in the North of England compared with the average cuts in the South east is a disgrace that we will take years to recover from. (We in this context meaning the North of England, and Liberal Democrats in the North). The over-riding Treasury view is still that in order to return the economy of the UK to growth, most investment must go into the areas that are already growing. London and the South East are sucking the lifeblood from regions that are thought to be peripheral; not just the North, though we are suffering the worse.

    Tony Greaves

  • Stephen Hesketh 10th Mar '14 - 8:40pm

    I’m not in favour of articles in which I can find nothing to disagree with!
    Tony Greaves makes additional good points. It a genuine disgrace that successive ‘National’ governments have run the British economy with such a strong bias towards the square mile and south east generally. No wonder London booms and the Scottish and Welsh Nationalists are able to spin this fact to their political benefit. And HS2 will only serve to increase the effective size and dominance of the ‘south east’ in English and British social, economic and political life.

    The fact that so many of our political leaders, past and present, represent or have represented non-south eastern constituencies goes far to prove John Pugh’s point regarding the deep-seated bias of our governmental institutions. Terms such as ‘the home counties’ and ‘the provinces’ give glimpses in to this crass institutionally biased world.

    Liberal Democrats in all the English regions should lead the fight to rebalance power away from the centre. I really can’t imagine us turning a blind eye to such concentrations of power in other areas of our political or economic life. It simply can not be healthy for the greater number of British people or our state.

  • Stephen Donnelly 10th Mar '14 - 10:40pm

    The general case that government, and specifically this government has a bias toward the South is well made but I am a little depressed to see a defence of the RDAs. No doubt the consultants and property developers will disagree, but as a Manchester business man I think they provided a poor return on investment for tax payers. There are some interesting ideas about the regeneration of the North that are worth consideration :

    See Evan Davies article on the case for making Hebden Bridge the UKs second city. http://www.bbc.co.uk/news/business-26472423.

    That article is not as ridiculous as the title suggests and builds on the ‘Manpool’ idea put forward by Jim O’Neill. http://www.theguardian.com/cities/2014/mar/02/jim-o-neill-prosperous-britain-devolve-power-london.

    Finally, the creation of Media City in Salford and the relocation of parts of the BBC was a bold and imaginative move by the last Labour government.

  • @ Stephen Hesketh

    “And HS2 will only serve to increase the effective size and dominance of the ‘south east’ in English and British social, economic and political life.”

    So why don’t we shut down the West Coast Mainline and then the North would really boom, wouldn’t it? I trust you were just as much against all the investment put into the line in the 2000s.

    Believe me, HS2 has very little benefit in the south (and offers very little political gain for anyone either). Why is a massive investment in linking up the regions of the UK (on top of other investment in infrastructure like electrification and the Northern Hub) supposed to have a negative effect when no-one has complained about this in relation to previous infrastructure schemes?

    @ Tony Greaves.

    How can you justify local authorities who receive far less funding to start with receiving the same level of cuts as those who receive far more per person? There is a real problem of distribution of tax money across the UK, with London and the South East already paying in far more in taxes than they receive in spending overall. If we cut public provision almost totally in the wealthier regions, it effectively delegitimises taxation and public spending overall. People rightly ask: I pay all this tax and what do I get in return?

  • @ Tony Greaves

    “London and the South East are sucking the lifeblood from regions that are thought to be peripheral; not just the North, though we are suffering the worse.”

    So that’ll be the “sucking the lifeblood” that involves paying tens of billions of pounds more tax a year than they receive in total public spending then?

    The problem is that many UK regions outside London don’t generate enough “lifeblood” in the first place in terms of successful private enterprise. If they could raise standards in terms of skills and qualifications, or become more attractive to those who do have high level qualifications, that would help attract businesses to locate there.

    I think it is much more about the quality of public spending (which is already skewed outside London and the South East) rather than the quantity. Many regions are overwhelmingly dependent on the public purse. Increasing this dependency, as Labour did during its years in power, even if it were possible given the need to cut the budget deficit, is hardly likely to work if it has already failed once before.

  • Only someone who has comketely lost the plot can come here whinging that London is–
    “..paying tens of billions of pounds more tax a year than they receive in total public spending..”

    Just a few recent examples of the disproportionate public purse subsidies to London —
    The Olympics, the Royal Jubilee celebrations, the Royal Opera House and the lions share of all public arts funding, London Crossrail, and to top it all the multi, multi billion pound bail out of the City of London based banks.

    Are these not examples of public spending ?

  • Bill le Breton 11th Mar '14 - 10:06am

    RC, the use of European investment in LIverpool and its extraordinary turn round under the Liberal Democrat administration from 1998 is proof of what could be achieved in such cities given sufficient funds for the improvement in infrastructure required.

    The potential for the M62 City (see Evan Davies last night) is huge. We have wasted four years of low interest rates and economic slack which could have been used to build the vital communications to power that ‘second’ city.

    It also disproves your regurgitated metropolitan clap trap.

  • @RC

    Around half the population of England live in the North and Midlands yet they receive only 26% of the infrastructure spending according to:

    http://blogs.spectator.co.uk/alex-massie/2013/12/london-is-different-the-government-will-spend-money-there/

    “If they could raise standards in terms of skills and qualifications, or become more attractive to those who do have high level qualifications, that would help attract businesses to locate there.”

    Nothing could be further from the truth. The North has the life sucked out of it as many of its top quality graduates have to move to London and the South-East to find employment in their chosen field. Most of the ones I know that have moved there hate it and would return northwards at the drop of a hat to improve the quality of their life if the opportunities existed. What is the point of raising standards even further if everyone has to leave to find employment? Businesses locate in the South-East because of that disproportionate spending on infrastructure – they want to be near the hub airports for example – but they also want to be near their competitors so they can benefit from a pool of labour as they know it’ll be easier to poach a worker from another company if the employee doesn’t have to move house. It has absolutely nothing to do with a desire by the employees to want to work in the South-East to start with.

  • @ John Tilley

    Go and look at the government figures for total spending before ladling out insults. They show that I am right and you are wrong. Despite all the examples you cite, London and the South East pays tens of billions pounds more in tax than it gets in TOTAL spending.

  • @ Bill le Breton

    “It also disproves your regurgitated metropolitan clap trap”

    Disproof requires facts to do it. And you haven’t provided any. Merely one example from one city, which is still trailing economically, despite what you say about it.

    I agree we should be investing in Northern cities by the way, the Northern Hub investment being a prime example, but it’s more about spending right than spending more.

  • Selwyn Runnett 11th Mar '14 - 10:47am

    I agree with Tony Greaves. The initial policy of this Government to cut infrastructure investment was perverse and hit the North disproportionately. Ally this with the effect of Treasury policy on local government funding and we can all see the result. However, let’s not forget Labour’s woeful record on support for the North. We seem to keep going round this circle . From the time of The Campaign for the North in the 1970s, many of us have kept making the case for equity in the distribution of public investment in the UK and the case for a the east-west M62 City (Mind the Gap with Evan Davis last night) originally envisaged in the Edwardian era. If we’re honest, we haven’t made a significant impact on the underlying bias created by the sheer scale and weight of London. Labour hasn’t tackled this. It’s a golden opportunity for the Lib Dems to have a policy for the North – but are we actually going to do anything about it? Well done to our Northern Council Leaders, MPs and Peers. Let’s see some real commitment from the Party for the Northern economy.

  • Paul in Twickenham 11th Mar '14 - 11:42am

    In 1964 the Liberal Manifesto “Think for Yourself” had this to say: “The skills and potential wealth of Britain will not be fully used if people continue to drift to the south-east”. And 50 years later? We could usefuly begin with that excellent document as the basis for a sound Liberal policy.

  • Bill le Breton 11th Mar '14 - 2:13pm

    RC – Liverpool is a pretty good example and the only non-London city to have received this quantity and quality of investment.

    When I read your remarks all I hear are the words trotted out by the Tory Government 1979 – 1997. If you have spent time and energy and seriously committed your talents to a northern city then I feel you have a certain right to comment in that way, but if you haven’t then your prejudice is inexcusable.

    Once upon a time I came to the conclusion that if the Liberal Democrats couldn’t make progress in cities such as Liverpool, Manchester, Leeds, Bradford, Sheffield and Newcastle it could not be considered a national party. The progress in those cities was a magnificent feat – the party’s power and influence brought liberty and life chances to millions in a way that is clearly beyond your inadequate imagination .

  • @ Steve
    You’ve got it all the wrong way round. The South East needs more infrastructure investment because it is busy working to pay the taxes to support the rest of the UK, as is explained here:

    http://www.cebr.com/reports/how-money-in-some-regions-subsidises-others/

    It has more problems with congestion and so needs more infrastructure projects to cope with it. Are you seriously suggesting we have a policy of building infrastructure where it is least needed while neglecting the areas where it is? That sounds utterly barmy to me.

    @ Selwyn Runnett

    “I agree with Tony Greaves. The initial policy of this Government to cut infrastructure investment was perverse and hit the North disproportionately.”

    Which cancelled northern infrastructure projects are you talking about?

    @ Bill le Breton

    “Liverpool is a pretty good example and the only non-London city to have received this quantity and quality of investment.”

    Liverpool is a great city, but the problem is that none of the Northern cities generate the kind of export-led private sector growth that can be seen for example in regional German cities. This, fundamentally, is the only way we are going to be able to rescue the economies of the UK’s regions. And I say that as someone who thinks the public sector can be a good thing and has a major role to play as part of a modern, mixed economy. I am NOT a Thatcherite and never have been.

    So far, regional policy has failed spectacularly to create that kind of self-sustaining prosperity and simply blaming it all on London isn’t going to wash, frankly. The northern cities went through a major collapse of key industries like coal, textiles, steel and shipbuilding and much of that was due to structural global shifts that cannot be blamed on government policy. The problem is that they failed to find successor industries of sufficient scale to take their place or they failed to move production up the value chain in order to avoid direct competition with low cost foreign rivals. Only a few survivors, often in foreign hands, like Jaguar Land Rover, have managed to do this and all too often their profits are now heading abroad.

  • “….it effectively delegitimises taxation and public spending overall. People rightly ask: I pay all this tax and what do I get in return?”

    Ah yes, the cry of the saloon bar Tory through the ages. Why should people pay taxes if they do not personally profit? Greed and selfishness are the only things that matter. They notice every penny that is spent on someone else and begrudge every penny. They can tell you the price of everything. They know the value of what?

    This mean-minded, illiberal skinflint approach would be bad enough if it were just stupidity and ignorance. But it is the wilfull refusal to acknowledge the facts that is appalling. Why does anyone think that an overheated economy in London and the South East is good for anyone? It is certainly not good for those people in London struggling to find a home, who have to pay a fortune to travel longer and longer distances to get to work in transport systems bursting at the seams. A more equal distribution of public spending would benefit us all. It would be good for the North and take some of the burden off the overdeveloped South East.

  • Eddie Sammon 11th Mar '14 - 3:41pm

    I resent this kind of racism against northern people suggested by RC. London has many state granted monopolies – it is not that they are the ones supporting the north through taxes – we are supporting London through permitting the status quo. It’s a two way problem.

  • Eddie Sammon 11th Mar '14 - 3:49pm

    We’re also paying the inflation tax to support London’s financial services. It’s wrong to say that we are the takers and they are the makers. I’ve lived in London and the north, and will probs go back to London, so there’s no bias here.

    Regards

  • Eddie Sammon 11th Mar '14 - 4:49pm

    OK, suggesting possibly racism against northerners was a criticism too far, so I’m sorry about that, but I have pointed out to RC a few times reasons how London has an unfair advantage to the north. I don’t think we can leave London alone in our plans to renovate the north.However, we could come to a deal: move some public institutions out of London and you can keep more of your tax money. This would seem fairer and more liberal to me.

  • @ John Tilley

    I’m not articulating these ideas because I agree with them. I’m trying to explain the mentality that can take hold if funding is cut below a certain level, to the point where public services no longer provide an attractive alternative to “going private”.

    “A more equal distribution of public spending would benefit us all. ”

    So you’re for increasing the existing disparity between tax and revenue in London and the South East?. They already receive far less in spending than they pay in tax. Sorry, but this is a demonstrable truth.

    http://www.cebr.com/reports/how-money-in-some-regions-subsidises-others/

    @ Eddie Sammon
    Moving a few public institutions out of London is not going to solve the fundamental problem of many UK regions: the weakness of the private sector. We’ve got to think much more carefully about how we nurture and grow private business in these areas, because so far regional policy has failed.

    Saying this does not make me a “racist”. Sorry, but I resent this accusation absolutely.

  • We need to go into survival mode as a party. Would it be best to focus our resources where our support is most concentrated. In other words campaign hard in the south west, rather than bother too much with the north? Labour are reclaiming their heartlands in the north.

    Sorry to our northern colleagues if that sounds harsh. We must be logical and ruthless about it, there is not much room left for sentimentality.

  • Eddie Sammon 11th Mar '14 - 9:15pm

    RC, but why should London get all the national institutions? It doesn’t matter if it wouldn’t make much difference, even though I think it would. Why should the Lords be in London? Because it is convenient? Convenient for Londoners!

    It just seems so obvious to me and any liberal that when looking at inequality we look at the top as well as the bottom. London has benefited the most from the £375 billion spent on quantitative easing – we can’t just blame the North for our money getting devalued and spent on London property by bankers blackmailing us over bonuses, after they played a part in messing up in the first place.

  • Eddie Sammon 11th Mar '14 - 10:13pm

    I understand it is more efficient to have the political, financial, legal and media centres close together, but above all, regardless of disagreements over this, I just want to defend against the idea of hardworking south supporting a feckless north when there isn’t a level playing field. London receives many benefits besides tax revenues, so we cannot just look at that figure.

  • What is so depressing is how obvious it is, to anybody outside the bubble, that an effective regional policy would be right for the country and the right way for Lib Dems to win votes.

    But our leaders are as much in love with central power as anybody is, they simply don’t care about provincial Britain and that’s that.

  • From an electoral point of view, being a party of the regions must be essential for the Lib Dems. Many of your seats are situated geographically distant from London, which suggests that voters have previously voted for you on the perception that are not a London-centric party. RC’s comments would be enough to lose you half your seats if they were repeated to the electorate in the run-up to May 2015.

  • Paul in Twickenham 12th Mar '14 - 12:16am

    @RC – you are telling us that there are fiscal transfers from wealthier parts of the country to less wealthy parts of the country?

  • Can we again ask RC to reveal his / her identity please?

  • Tim13 – why? As just posted on another thread, some of us are not allowed to post under our full/real names by our employers (I am a civil servant and not allowed to do so, or to door-knock or phone canvass). Wouldn’t you rather more rather than fewer people can contribute on here? As an aside, “Tim13” doesn’t tell anyone else a huge amount either!

  • Alexander Matthews 12th Mar '14 - 1:51pm

    The two key problems for this debate are this:

    – first: this is not a north/south divide, it is a divide between the south-east and the rest of the country.

    – second: it frame completely around what London has and the North does have, instead of the North actually showing what it can offer.

    Why do I live in London, despite coming from the Midlands, because the best promoters of London are those outside of London who constantly tell me all the amazing things it has!

  • Paul in Twickenham 12th Mar '14 - 2:20pm

    I am in the same situation as Mark. Many people on this site know exactly who I am, but I would feel constrained in my comments if required to use my full name. Under those circumstances I would not be able to talk about matters that might be perceived – however tangentially – to relate to my day job in finance.

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