Historically, the economy of Northern England has not enjoyed the same levels of prosperity as that of the south. However Chancellor George Osborne’s ‘Northern Powerhouse’ concept aims to address this economic imbalance, attracting investment into northern cities and towns and levelling the playing field once and for all.
The growing sense of potential around the North is illustrated in a 2015 report by the Institute for Public Policy Research North, which places the value of its economy at £289bn – meaning that if it were a national economy it would rank as the tenth largest in the EU. Additionally, at the start of 2015 the North was the fastest growing region of Britain – between January and March, gross domestic product (GDP) increased by 0.5% in the North East and the North West compared with growth of 0.4% in the UK as a whole. However, in order to achieve the Chancellor’s targets the North’s economy will need to continue grow at a faster rate than the rest of the country.
Despite recent Office for National Statistics figures showing that London and the South East are predicted to be the main drivers of UK growth until 2018, the North still has a wealth of economic assets which it can draw upon. For instance, the region has an abundance of land, and as climate change impacts southern England, the North’s agriculture potential increases. The North also has a strong tourist industry, attracting 4.4 million visitors per year. Manchester airport is now the UK’s third largest in terms of passenger numbers, and the addition of new routes into and out of the North’s airports will serve to boost this tourist economy. The Northern Powerhouse initiative places a strong emphasis on travel, proposing a £1.2 billion boost to rail services in order to bring the major Northern cities closer together with the aim of facilitating a single major economy, as opposed to the current scenario of a number of small economies competing against each other.
As well as investing in transport, cities of the North are also being boosted by the revolutionary devolution deals granted over the past two years. So far Greater Manchester, Sheffield, Liverpool , Birmingham, and the North East & Tees Valley have all taken the deals, giving council leaders in the regions greater control of their finances, the ability to steer their economies and collaborate to bring to life the Northern Powerhouse.
The Northern Powerhouse is really still a concept but the reality is firmly on the Governments agenda. The end of 2015 saw some definitive action and the promise of further investment should see the reality getting closer during 2016.