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Why can’t the North go Dutch?

(Alamy)

7 min read

Comparing the North of England with London obscures more than it reveals, argues Tom Forth. Only by judging it alongside other populous parts of northern Europe does the true scale of its problems become apparent – as well as potential solutions

Does North England have a strong economy and a bright future as part of a prosperous Britain, or is it a region that never recovered from deindustrialisation with few prospects for future success?

It’s a question that this Parliament was supposed to answer but has flunked, partly because those trying to do so were, in the main, trying from the wrong place. The unique advantages enjoyed by London, one of the world’s few truly global cities, make it a poor comparator for other regions in the United Kingdom. Time and again, policymakers have been misled by a misguided effort to see the issues of North England through the lens of the capital.

Culturally we share more than just beer, darts, football and fried food — but that’s a good start

This leads to some strange misunderstandings; for example, that North England is a place of stark inequality. In fact, within the region there is a remarkable uniformity. Then there’s the question of size. How many people in Whitehall, for instance, know that Manchester is more populous and more densely populated than Amsterdam?

That’s why if one really wants to understand the region, it’s far better to compare it not to London or Paris but to the next two most populous regions of northern Europe – the Netherlands and North-Rhine Westphalia in Germany.

Let’s start in the Netherlands
The core of the Dutch economy is the Randstad, an urban area of about seven and a half million people including the cities of Rotterdam, Amsterdam, The Hague and Utrecht.
North England has a similar urban core of eight million people centred on Manchester and reaching to Liverpool, Leeds and Sheffield.

Beyond the seven and a half million population urban core of the Netherlands live another nine and a half million Dutch.

Beyond the eight million population urban core of North England live another eight million Northerners.

North England and the Netherlands have about the same area of land at a similar latitude; Groningen is north of Chester. Culturally we share more than just beer, darts, football and fried food – but that’s a good start.

Similarities and differences
There is less similarity in our economies. The economy of the Netherlands is at least 60 per cent larger than the economy of North England. The incomes of people in North England are boosted by money transferred from the more prosperous South East, but Dutch households still have 20 per cent more money to spend.

Public sector spending on research and development in the Netherlands is twice as high as in North England. So is private sector spending.

Despite the challenges of building in a country that is mostly at or below sea level, the Netherlands has as much railway as North England, and twice as much of it is electrified. The much larger, faster, more efficient and more reliable Dutch trains carry over twice as many passengers per year. A new freight railway connects the country’s main port to the rest of Europe without disturbing passenger trains. A new high speed railway does the same for international and domestic travel, relieving congestion so that more local and regional trains can run.

With recent curtailments of both HS2 and Northern Powerhouse Rail, there is little hope of anything similar within a generation in North England.

Graphic

How did we get here?
North England’s economy was stronger than the Netherlands’ for at least 100 years from the mid-1800s. In the mid-1960s the Netherlands caught up and overtook it. Since then, North England has fallen ever further behind, despite its similarities.

We can gain some insight into why this might have happened by looking at North-Rhine Westphalia. It has some key differences from the Netherlands that help us think about North England’s deficiencies and opportunities.

North-Rhine Westphalia does not contain a national capital. It has no significant oil and gas resources. It has substantially more manufacturing as a share of its economy. It has many fewer graduates. And yet North-Rhine Westphalia, just like the Netherlands, has excellent infrastructure and an economy about 60 per cent stronger than North England’s.

Why North England has fallen behind
My best theory for why North England has fallen behind makes for unpleasant reading. Bluntly, the Dutch people and the Dutch government are interested in the prosperity of the Netherlands more than the North English people and the UK government are interested in the prosperity of North England.

North England’s ambitions are set by, and in effect constrained by, a government in Westminster that doesn’t believe that North England can achieve as much as the Netherlands, and which invests with preference to the seat of government.

Differences in attitudes and ambitions lead to different actions. In both the Netherlands and North-Rhine Westphalia, governments are unashamed to invest in cities. There are trams, metros, underground railway stations and new railway lines, all of which have been cancelled or been beyond consideration in North England’s similar cities in recent decades. North England has less than a quarter as many tram and metro stations. Instead, our national government celebrates the cancellation of investments such as HS2 to fund subsidies for inefficient bus networks that contribute little to long-term prosperity.

How we can do better
The good news for North England is that its comparative deficiencies are so obvious. There is little reason why, with better government and a similar desire to build a better and more prosperous society, we could not achieve the same prosperity in North England as exists in the Netherlands or North-Rhine Westphalia. Just as those places caught up with our stronger economy in the 1960s after a century of trailing us, and in part by emulating us, so we could catch up today.

North English success will probably require slightly higher taxes to fund higher public spending, but this should pay dividends quite quickly.

Success will require greater freedom from a UK government that currently restrains ambitions for economic growth locally for short-term political reasons, but the foundations of this have been laid by city region devolution deals and metro mayors.

It will also require a desire locally to build the more and better homes, business premises and infrastructure that North England lacks and that form the foundation of its economic underperformance.

North England will stand its best chance of success if it positions itself in healthy competition with the rest of the UK

Success will need the UK government and Britain’s national institutions that surround it in London to challenge itself constantly and to stop preferencing investment and the creation of new ‘national’ organisations near to itself. There is a long list of organisations like the Crick Institute and ARIA that are placed by the UK government in London for no good reason. If that list continues to grow it will be to the further detriment of both the UK’s regional economies and the UK’s overall prosperity.

Success will require the recreation and funding of abolished regional development agencies, equivalents of which operate with success in the Netherlands and in North Rhine-Westphalia.
Most controversially, North England will stand its best chance of success if it positions itself in healthy competition with the rest of the UK. It must be willing, probably starting with its great cities, to take control of its own development, including by raising taxes.

There is nothing magic in the Netherlands or North-Rhine Westphalia that we could not emulate in North England. The question for those in North England is whether we want to do so. The question for those in and close to the UK government is whether you want to support us and to let us try. 

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