Northern powerhouse: devolution steps up a gear

So what’s all this fuss about a Northern Powerhouse?

The phrase conjures up images of JB Priestley’s polluted industrial landscapes, dark satanic mills, flat caps and ferrets, but this could not be further from the truth. We are talking about corridors of power from Liverpool, through Manchester, Leeds, Sheffield to Hull and Newcastle, based on investment in better infrastructure and building upon the physical and cultural renaissance in the major northern cities.

Lord knows that the regular drivers of trans-Pennine M62 and the rail commuters from Liverpool to Hull will be crying hallelujah for the investment in the connections between cities. Never have so many people languished for so long in the packed carriages and car park mimicking roads of the UK countryside. In Chancellor of the Exchequer George Osborne’s words: “The transport network in the north is simply not fit for purpose.” It is quicker to travel the 283 miles from London to Paris by train than it is to travel less than half that distance between Liverpool and Hull.

Within 40 miles of Manchester, you have Leeds, Sheffield and Liverpool, Lancashire, Cheshire and Yorkshire – a belt of cities and towns that contains ten million people – more than Tokyo, New York or London. Sopra Steria’s base in Cheshire supports activity in the public and private sectors, delivering digital solutions to global and regional business problems on a local basis.

But it’s more than investment in the physical environment, it’s also about the devolution of powers to the region. A Minister for the Northern Powerhouse working within the Department for Communities and Local Government (DCLG), a Teeside MP James Wharton, was appointed by government in February and he will oversee the devolving of powers over skills, housing, police, health as well as transport to the northern region. Within a month an interim Mayor will be appointed by council bosses to lead the Greater Manchester Combined Authority before the election of a successor in 2017.

Mr Osborne has promised just over £11m to invest in tech incubators in Manchester, Leeds and Sheffield to support SMEs to grow into the engine of the northern powerhouse. Further investment has been promised for a Fintech Innovation Hub focusing on the financial service. His Tech Nation report published in February, noted the 170,000 currently working in digital business. The Budget announcement detailed further investment and support that could be called upon to deliver:

More than ever before, the advantages that digital can bring will need to be applied with vigour. The perceived disadvantages of distance from the financial and business markets of central London will need to be foreshortened through virtual cosiness. The vibrancy of northern business will need to radiate across electronic networks to attract further investment and growth on a global basis to prevent leaching from other UK regions. Devolved development is all about placing the whole of the UK on a higher platform for economic performance.

The public sector could benefit from this burgeoning of local digital business and innovation as it will face major challenges to meet the demands of the northern citizenry while managing within an ever tightening public purse. The Greater Manchester Combined Authority will be fully responsible for how this transformation of the public services unfolds, and the scrutiny of this change will be acute, particularly with the health and social care services at a cost of £6bn. Other regions, such as Wales, have felt this high degree of scrutiny over their stewardship of health services and been found lacking, so the achievement bar is high.

The potential is there for a Northern Powerhouse, supported by digital innovation, emerging and pioneering business and local democratic muscle, that develops its own wealth-generation and shapes public services to reflect the needs of their local communities.

What are your thoughts? Leave a comment below or contact me by email.