London calling

As I write this, it is exactly four years since I was sitting in a restaurant watching the opening ceremony of the 2012 Olympics in London. It seems like an awful long time ago. Although there is a sense looking back that things were improving, following the savage recession of 2008-09, the economic data released at the time suggested that the UK economy was struggling to gain traction, although a more solid recovery was just around the corner. That said, there was a feelgood factor in the air, at least in London, and surveys conducted at the time pointed to a more general feeling of national wellbeing. 

Fast forward four years and things feel rather different. The national mood remains sullen in the wake of the EU referendum, although perhaps not quite as fractious as a month ago, whilst regional disparities have widened if anything. Economically, at least, London’s relative importance continues to rise, with a recent report suggesting that it contributes almost one-third of the UK’s tax receipts. It is to the UK what Germany is to the euro zone – it accounts for roughly the same share of output and is the UK’s paymaster in the same way that Germany is for the single currency region. 

Back when I was a lad, as they say, it all felt rather different. I was reminded of this by a number of films, which can be found on the British Film Institute website and on the North East Film Archive site which extolled the virtues of living in the thriving north east of England. The films were shot in the 1960s and were designed to convey the impression that the old days of flat caps and whippets were no more, and that the region was looking ahead to focus on the high tech and light engineering industries of tomorrow. It all seemed so optimistic and modern. As someone who grew up in the region around that time, I can relate to the sentiments portrayed. 

But I was also struck by the fact that within a decade, much of that optimism had crumbled as the heavy industries on which the region relied were wiped out, taking away the bedrock of support for the newer industries. Indeed it is from around the early-1980s that we became ever more aware of the inexorable drift southwards in the UK’s centre of economic gravity. 

Some 35 years on, even senior civil servants now admit that the UK is one of the most centralised economies in the developed world. And this is a problem since, as the Institute for Economic Affairs has pointed out, “decentralisation promotes … better matching of services to local preferences.” To the extent that many people outside the London bubble feel that they have increasingly been marginalised by their own government, which focuses ever more on the needs of the capital, this degree of centralisation may have been one of the contributory factors encouraging the electorate to stick two fingers up to the government last month. In fairness, there have been efforts to devolve powers back to the regions, with the creation of the Greater Manchester Combined Authority in 2011 the first attempt to give more control over planning and spending decisions. But the scheme is not without its critics and it is unclear to what extent it will be rolled out elsewhere, partly because not all cities want to follow the same model. 

It is thus ironic that during an EU referendum campaign in which one of the key slogans was “taking back control,” the government recognised the UK regional control problem, tried to do something about it (albeit perhaps too little too late) yet many were hesitant to grasp the opportunity when it was offered to them. It does make me wonder how we will be able to resolve many of the contradictions which dot the policy landscape. For an escapist reminder of how we see ourselves, you could do worse than go to Youtube and relive that Olympic opening ceremony. Indeed, maybe the Remain campaign would have done better to entrust their strategy to Danny Boyle. He certainly convinced me that things are better than they are.