George Osborne is Chancellor of the Exchequer and MP for Tatton
This is a massive moment for the north of England and our plan to build the Northern Powerhouse. After several months of private discussions across party lines, I have reached agreement with the civic leaders of Greater Manchester to create the first metro-wide elected mayor outside of London.
This will give Mancunians a powerful voice and bring practical improvements for local people, with better transport links, an Oyster-style travelcard, and more investment in skills, public health and the city’s economy.
I want to talk to other cities who are keen to follow Manchester’s lead – every city is different, and no model of local power will be the same. Giving cities power is part of our long term economic plan to reduce the decades-old gap between north and south, London and the rest.
Because one of the big opportunities that the north of England has is its great cities. In a modern, knowledge-based, economy city size matters like never before.
There is a powerful correlation between the size of a city and the productivity of its inhabitants. The top 600 cities in the world contain just 20 per cent of global population but create 60 per cent of global GDP.
Crucially, cities are also where clusters of successful industry are created – like the financial services cluster in London, or the digital economy of California’s Silicon Valley. As Europe’s largest city, London benefits from those important agglomeration effects, helping the capital to suck in money and talented people from all over world.
But let me be clear: my plan to build a Northern Powerhouse is not to rival the South, but to be its brother in arms as we fight for Britain’s share of the global economy. The cities in the great belt that runs from Liverpool to Hull all have strengths individually – but on a global scale they are also quite small. However, when combined they rival in size London or New York or Tokyo. In fact, living within a 40 mile radius of Manchester, there are around ten million people – a huge pool of talent.
It was this opportunity to create a Northern Powerhouse that I identified earlier this year. I said that if we can bring our northern cities closer together – not physically, or in some artificial political construct – but by providing modern transport connections, supporting great science and our universities here, giving more power and control to civic government; then we can create a northern powerhouse with the size, the population, the political and economic clout, to be as strong as any global city.
The idea has struck a chord. Since I talked about the northern powerhouse we’ve seen northern councils team up to set out their “One North” vision to improve connections between northern cities. We’ve seen Jim O’Neill’s Cities Commission make the case for elected metro-mayors to strengthen accountability and leadership in our big cities. The fact that many people seem to share the vision of a northern powerhouse has meant we have been able to move quickly, and in recent months I have been taking the steps to make this vision a reality.
In September, we had science – when the Government’s Chief Scientist responded to my invitation and set out ideas for a new international centre for the investigation of material science, which will bring together centres of expertise across the north.
In October, we had transport. At the moment it’s 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. We need to bring our northern cities together so they can pool their strengths. I asked David Higgins in the summer to see whether the case for new high speed links across the Pennines made sense – and he reported back last week that it did. That’s why the Prime Minister and I gave the green light to develop High Speed 3 – a fast east-west connection to speed up journeys right across the north. And we announced the creation of a Transport for the North – TfN – to do for the North what TfL has done for London.
Today, in November, Manchester becomes the first city to respond positively to our offer to move to an elected metro-mayor, and get new powers to improve the lives of its citizens. A few months ago this would have seemed impossible.
There’s still a huge amount to do, in the autumn statement and beyond. Reversing a decades long imbalance in our country’s economic geography takes time. But we are making more progress, more quickly than I dared to hope.
As a party we have a long tradition of Civic Conservatism. At the end of the 19th century, the Liberal Unionists brought their history of civic activism into our party. Successful civic leaders, like Joe Chamberlain in Birmingham, showed what could be achieved as entrepreneurial city mayor. The party of the country became the party of the cities too. It is no accident that the final agreement to create the Conservative and Unionist party was reached at Birmingham town hall.
There has never been a simplistic north/ south gap in politics. We have always done well in the rural parts and smaller towns of the north. At the last election we gained more seats in urban areas: Bury North; Blackpool North; Dewsbury; Harrogate and Knaresborough.
But we still need to do better in the north’s big cities. It’s sometimes said that the big northern cities have no Conservatives in them. But that’s not true. In Greater Manchester we have nearly a hundred hard-working councillors, two MPs and a great Conservative-run council in Trafford led by Sean Anstee. We need more like them so we can do more for the people in these cities.
When a mayor was mooted for London it was said that the mayor would only ever be a Labour place-holder. But immediately in the first election Ken Livingstone ran as an independent and shoved the official Labour candidate Frank Dobson out of the way. And since 2008 the city has had a fantastic Conservative mayor.
So much for that idea. I don’t think city government should be about being a branch office of Whitehall or spending money raised elsewhere. I don’t believe it should be about regional assemblies or creating new tiers of government either. Giving city mayors responsibility for their own destiny will, I believe, change politics for the better, and make our cities stronger.
Conservatives have everything to gain from this. Though we are coming to the end of this Parliament, today’s agreement shows there is still time to take more big steps forward. I believe creating an elected Mayor for Greater Manchester will come to be seen as one of the great reforming acts of this government, in the best tradition of progressive civic Conservatism.