In her set-piece economic speech on 29 January, Rachel Reeves made the building of a third runway for Heathrow Airport an absolute priority. This has understandably been met with a significant backlash from a number of different groups.
Andrew Rawnsley, in his opinion piece in the Observer on 2 February noted that there were two groups in particular who were up in arms about the announcement. The first group were naturally the environmentalists, for whom as Rawnsley rightly states, “Heathrow is a litmus test of whether or not the government is authentically committed to addressing the climate crisis. Backing expansion is a total fail. They kind of wanted to believe Ms Reeves back in the day when she told the Labour conference that she would be as proud to be ‘Britain’s first green chancellor’ as she would to be its first female one.”
It does seem odd that the Chancellor would want to spend so much of her political capital on a scheme which has dubious environmental credentials and which has a track record of being promoted and then abandoned a number of times over. It seems to be a long way from Reeves being the first green chancellor, in a government driving the country towards Net Zero.
Perhaps even more pertinently for us in the North, Rawnsley also argued that another group of people unhappy with the concentration on Heathrow airport and the new ‘Silicon Valley’ between Oxford and Cambridge are, “those who wanted to trust the chancellor and prime minister when they sought to contrast themselves with previous governments by saying they wouldn’t be fixated on the south-east of England and would instead seek to spread opportunity and prosperity across the country.”
Concerns of ‘brain drain’ in the North
Indeed, the day after Reeves’ speech, The Guardian was reporting that MPs from the north of England had voiced fears of a “brain drain” to southern infrastructure projects after Rachel Reeves’ announcement of several major developments in the south.
One northern Labour MP was quoted as saying: “There are good commitments to northern infrastructure in the speech, albeit smaller scale. But my worry is that we have a major skills shortage in this country and that these huge projects in the south of multiple airport expansions, the Oxford-Cambridge scheme and the [Lower] Thames Crossing will be a brain drain of talent.”
Meanwhile another Labour MP commented that: “The communication of this strategy is tone-deaf. There are many possible benefits for the north because of the manufacturing associated with big infrastructure projects, but we hear very little about any of that.”
Crossrail for the North?
Meanwhile, we still wait for serious announcements from the government for major infrastructure projects in the North, not least the improvement of the Transpennine rail link between Newcastle and Liverpool, which really should only take about two hours , but is at best over three hours and sometimes nearer four, with many scheduled trains cancelled.
It was reported in the Manchester Evening News in 2022 that a proposal from the North for an Integrated Rail Plan had been rejected on the grounds of cost, even though “no detailed analysis of potential long term economic benefits had been carried out.”
It was further reported that, “according to the technical papers for the IRP, the original northern plan rejected by ministers would have provided ‘the greatest increase in connectivity and capacity’ of all the options considered.”
Since 2022, there has been a deafening silence on any high speed rail link across the Pennines and sadly this continued in Ms Reeves’ speech last month.
Is the North being abandoned?
One has to wonder if the North is yet again being shortchanged and abandoned by a Westminster government. I am reminded of this every day when I go to work as I am forced to take a detour around the crumbling Gateshead flyover. As for dealing with the issue of the flyover, it has been noted by the BBC that, “talks have opened with the government for help toward its demolition and replacement, but so far no money has been forthcoming.”
It is little wonder that many people in the North, in the wake of Reeves ‘ prioritising of a third runway at Heathrow and the new ‘Silicon Valley’ between Oxford and Cambridge, are beginning to wonder if the North is being abandoned yet again.
A glimmer of good news
There was one bit of good news last week, which was that there is to be a review of the Treasury’s “green book” methodology. This is concerned with the way that the Treasury assesses value for money – a method that northern mayors and others have often argued is skewed against investments in the north of England, as it looks for best value for money in terms of immediate return and in so doing prioritises investment in London and the southeast and merely reinforces the already huge imbalance causing a vicious cycle to the expense of the North.
It remains to be seen, of course, just how fundamental the review of the green book will be…
A long way from a just transition
All this seems to be a long way from the just transition for the Northeast that myself and others have been arguing for, for the last few years. There seems to be little in terms of empowerment of people in the region, with little or nothing being said about developing a community wealth building economy in the Northeast, with what the writer Naomi Klein describes as, “diverse ownership structures: green energy coops, municipal energy, community-owned microgrids and more.”
Rather Reeves seems content to put investment into large infrastructure projects in the Southeast, with profits going to major corporations, in a panicky way to raise GDP at all costs, including that of the environment. Little thought appears to have been put into how these plans will improve the lives of the people of the country and certainly not those living in the North. Meanwhile, the most obvious way of promoting growth, through closer trading ties with the EU, is still being steadfastly rejected.
The question of whose GDP it is also comes to mind. Famously, in the run-up to the Brexit Referendum in 2016 Amand Menon, director of the UK in a Changing Europe, told an audience in Newcastle that leaving the EU would lead to a cut in national GDP. In that prediction he has of course, been proved totally correct. However, the story is not famous for what Menon said, but rather for what a woman in the Geordie crowd shouted in response: “That’s your bloody GDP. Not ours.”
That comment summed up in a nutshell one of the reasons for the decision in that referendum to leave the EU and is still a pertinent point today. As Aditya Chakrabortty has pointed out, “What drove so many towards Brexit or Jeremy Corbyn or even Boris Johnson was a failed economic model that boasted of its low tax, low costs and low regulation. Now that low tax is no longer an option and Britain has broken off its close trading relationship with Europe, the Labour government is stripping out whatever regulation it can.”
Simply trying to blindly raise the GDP of the UK, without seeing it more evenly distributed will not help to see the Labour government re-elected. Simply trying to raise GDP through infrastructure programmes that damage the environment will be neither sustainable or popular in the long-run. And simply raising GDP through huge infrastructure programmes in the Southeast will do nothing for the long-suffering people of the North, who have waited so long for a fair deal from a Westminster government.
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