🔮 Better than the Oracle? Our Fair Value found this +42% bagger 5 months before Buffett bought itRead More

Embattled UK PM Johnson launches plan to tackle regional inequality

Published 02/01/2022, 07:06 PM
Updated 02/02/2022, 11:57 AM
© Reuters. FILE PHOTO: British Prime Minister Boris Johnson holds talks with Ukrainian President Volodymyr Zelenskiy in Kyiv, Ukraine February 1, 2022. Ukrainian Presidential Press Service/Handout via REUTERS

By Kate Holton and Paul Sandle

LONDON (Reuters) -Britain vowed to repair the economic and social fabric of its "broken heartlands" on Wednesday, as the government set out a long-awaited plan to flesh out promises that helped Prime Minister Boris Johnson win a big parliamentary majority in 2019.

With Johnson now reeling from public anger over lockdown parties held at his Downing Street residence, his government published plans to funnel investment into towns and regions to mitigate deep-rooted social and economic inequalities.

Economists say geographical disparities in health, education and incomes are large and persistent, with cities such as London, Oxford and Cambridge accused of sucking funding and talent out of the rest of Britain.

Michael Gove, the minister tasked with delivering the policy, known as 'levelling up', said the 2016 Brexit vote to leave the European Union was a "wake-up call" that former industrial towns could no longer be overlooked.

"Economic opportunities spread more equally across the country is at the heart of levelling up, but it's also about community as well," he told parliament. "It's about repairing the social fabric of our broken heartlands."

Along with a promise to "get Brexit done", Johnson's 2019 pledge to prioritise growth in parts of the country outside the affluent southeast helped him to win parliamentary seats in areas that had never voted Conservative before.

Gove said the plan would result in the biggest shift of power from London to local leaders in modern times.

'EXTREMELY CHALLENGING'

Successive British governments, both Conservative and Labour, have sought for decades to address inequality by devolving power from Westminster to the regions, but with only limited success.

Critics say that in the last decade these efforts were patchy and undermined by budget cuts even as some local authorities won new policymaking powers in areas such as transport and planning.

The policies announced on Wednesday include a government spending commitment on research and development, the creation of new mayors and the promotion of innovation clusters.

Opposition Labour Party lawmaker Lisa Nandy criticised Gove's plan as a list of recycled policies that failed to provide new funding or address the heart of the problems.

Paul Johnson of the Institute for Fiscal Studies also sounded a note of scepticism.

"Meeting the core ambition of simultaneously improving education and skill levels and availability of high paying jobs in poorer regions will prove extremely challenging. Without that, levelling up will not happen," he said.

In a foreword to the policy paper, the prime minister said it would be his "defining mission" to level up the country.

"I am determined to break that link between geography and destiny so that it makes good business sense for the private sector to invest in areas that have for too long felt left behind," he wrote.

© Reuters. FILE PHOTO: British Prime Minister Boris Johnson holds talks with Ukrainian President Volodymyr Zelenskiy in Kyiv, Ukraine February 1, 2022. Ukrainian Presidential Press Service/Handout via REUTERS

Johnson is struggling to shore up his premiership after damaging revelations of parties in his Downing Street office and other government buildings held during COVID-19 lockdowns that have upset voters and alienated some lawmakers in his own Conservative Party.

A report on the gatherings on Monday pointed to "serious failures of leadership" at the heart of British government.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.