Levelling up is one of the most ambitious government aspirations in decades but the opportunity could be derailed if Whitehall doesn’t change the way it is delivering it, according to Stephen Beechey, public sector director at Wates Group.
Group Public Sector Director
More visibility over project pipelines, greater autonomy for local government and a better way of doling out funds are all required if levelling up is to be a success.
The importance of long-term pipelines
Taking a more long-term view on development pipelines would create more certainty for construction firms as they embark on recruitment drives to address the industry’s skills shortage.
“If we had longer term pipelines of work, we’d be able to make more strategic decisions around training and apprenticeships, if you’ve got a piecemeal approach, it makes it much more difficult to make those decisions.”
Better pipeline visibility would also allow construction firms to push ahead with the greater use of modern construction techniques, Beechey added.
Wates opened an 83,000 sq ft modular factory in Coventry off the back of the company’s appointment to build new schools for the Department for Education and new prisons for the Ministry of Justice.
“If we got more visibility of those sorts of pipelines, we’d be able to invest in more of those types of manufacturing facilities, as would our peers, and you could invest in areas where levelling up is needed.”
The future of levelling up
Modular construction has long been mooted as a key component of the net zero agenda. In Beechey’s eyes, the pursuit of a low carbon society and levelling up are “two sides of the same coin.”
However, there is a fear that levelling up has been pushed to the back burner of late given the political unrest that culminated in the resignation of Prime Minister Boris Johnson.
A leadership contest is now underway, but the focus of candidates has been on issues preoccupying Tory party members, such as addressing the cost-of-living crisis and high taxes; levelling up, one of Johnson’s flagship policies, has hardly been mentioned.
Despite political pandemonium, Beechey thinks levelling up is here to stay.
“Levelling up, in terms of what the white paper says, is one of the most ambitious pieces of government legislation that has possibly ever been introduced and I think it’s absolutely fundamental to the long-term success of our country.”
The idea of levelling up is to identify what towns and cities across the country need to boost economic growth and, in turn, make them better places to live for residents.
So far though, progress has been slow. Beechey comments:
“I don’t think we’ve made much progress so far, we have got to get this critical programme off the ground and on a positive trajectory.”
Devolution and funding
One way to do this would be to improve the way funding for potentially transformative projects is distributed, according to Beechey. Beechey gave Blackpool as an example of a place that is receiving lots of government cash but in “a completely uncoordinated way.”
The government has created many different funding pots and has left local authorities to fight it out for a share of each. This approach is not working and as a result, some towns are being left behind, Beechey believes.
The answer, he said, is a more holistic approach, which means giving more power to the people best placed to wield it.
“Why on earth is there a situation where [councils] are having to bid for funds and then being told by central government as to whether that passes the test? It is absolutely fundamental that local government is given greater autonomy,”
Time to borrow?
If the government doesn’t change tack on funding, one way that local authorities may be able to help themselves is through higher levels of borrowing, according to Beechey.
“It is controversial but it is something that is relevant, we are quite conservative. Our levels of local government debt are significantly lower than the OECD and European Union averages. There’s potential here for allowing some greater levels of debt to be realised.”
But this too would likely require greater decentralisation.
Germany, a country widely thought to have cracked the devolution issues, spends three times more every year on economic development than the UK, Beechey explained.
“[In Germany] regional inequalities have been falling consistently over the last 30 years. During that same 30 years regional inequalities in the UK have been on a negative trajectory.”
As the UK prepares for a new Prime Minister, this could be the time to learn from European neighbours.