Warwick Lightfoot is Policy Exchange’s Head of Economics, and Will Heaven is Policy Exchange’s Director of Policy.
“It is time we unleashed the productive power, not just of London and the South East but of every corner of England, Scotland, Wales and Northern Ireland.” So said Boris Johnson in one of his first speeches as Prime Minister. A great ambition – but how to make it a reality? What are the practical steps that the Government can take? This piece, the first of a three-part series on the Union for Conservative Home by Policy Exchange, will offer some of the answers. They may be useful to a new Department of the Union, should such a body be created after Brexit.
Today’s political context adds urgency to the debate around the Union’s future. There can be no denying that Brexit has opened it up to a new nationalist and separatist agenda. The UK is under significant stress. In Scotland – which, of the four nations of the UK, was most strongly pro-remain in 2016 – the SNP’s stock is riding high. In Wales, there is a growing minority of support for independence. There is also evidence that some English Conservatives are so fed up about Brexit not being delivered that they are willing, in theory, to sacrifice the Union to the cause. On the other side, in Northern Ireland, the DUP are asking how much ministers care about the Union.
Yet the case for the Union remains strong and unionists should not be reluctant to make it. The best way to do this and strengthen the Union is to ensure that its economic, cultural and social value is not hidden from all of the UK’s citizens. Above all, as Policy Exchange’s recent paper, Modernising the United Kingdom argues, ministers should focus on two areas: greater capital spending to better connect each nation and cross-Union representation in Westminster.
On capital spending, notwithstanding the true legal and constitutional position, the UK Government has been encouraged to limit its capacity to spend in the devolved nations to national programmes, i.e., in the jargon, “reserved” areas: defence and immigration, for example. But there is nothing constitutionally preventing the UK Government from providing extra funds and expertise to deliver projects in devolved policy areas like health, education, transport, sports and the arts. The Treasury, in particular, has been too timid, saying that to spend more in devolved areas would undermine devolution itself. This simply isn’t true.
As the UK takes full responsibility for the social and economic development functions and spending that went with the EU’s social and structural funds, these self-imposed restrictions must be scrapped. The Conservative Government’s 2017 manifesto pledge to set up a ‘UK Shared Prosperity Fund’ should be strengthened. If projects have local support, and are subjected to rigorous auditing, the Government should be more ambitious in its pursuit of spreading the benefits of the Union. These could include upgrades to transport, broadband, ports and giving places support to promote foreign direct investment in their area. Most importantly, these should be badged as UK projects as a condition of accepting funds and used to promote UK unity, just as the EU uses structural funds to promote EU cohesion.
Thankfully, the costs of this are affordable. The public finances are in a good place. There is scope to increase borrowing, the stock of public debt to national income is manageable and the cost of servicing public debt is historically low. There is both financial and economic scope for a more ambitious public programme of capital investment, which should be secured through a UK modernisation spending plan as soon as Brexit is settled.
How to demonstrate that it is the Union that is delivering these sorts of projects? To begin with, the UK brand must be visible. As Andrew Bowie, Conservative MP for West Aberdeenshire and Kincardine, said at a Policy Exchange fringe event in Manchester a few weeks ago, “Every single thing the Scottish government does in Scotland has a saltire on the side of it, and it says ‘paid for and delivered by the Scottish government’. Where’s our UK flag? Where’s ‘paid for and delivered by Her Majesty’s government’, or ‘the UK government in Scotland’?”
At the same event, an anecdote by Lord Caine, formerly a long-time adviser at the Northern Ireland Office, demonstrated how timid the UK Government can be on this issue. He recounted how “officials once tried to persuade us that before we published a Treasury document in Northern Ireland, we had to carry out an equality impact assessment because it had a tiny Union flag in the corner”.
Some civil servants may scoff at this, but it’s this branding – for want of a better word – that helps to demonstrate to the public the value of belonging to the United Kingdom. It was great to see, for example, British embassy staff in Union flag-emblazoned high-vis jackets during the operation to return Thomas Cook’s stranded passengers back to the UK. More of this is needed at home, too.
The Government should increase its physical presence in devolved nations. It should draw up an initial plan of relocating or establishing capacity of central government departments in places of the country where their work is most relevant, and in particular, in the case of departments with reserved functions. For example, the Department for Environment, Food and Rural Affairs could expand its operation in places like Peterhead.
Politically, cross-Union representation will also be a vital tool. With all the four nations in mind, there is a strong case for the UK Government establishing a Council of UK Civic Leaders – chaired by the Prime Minister, who is also the Minister for the Union – which should meet regularly with ministers and officials. This should include empowered English civic leaders, such as metro-mayors, and leaders of city councils in devolved nations. The Mayor of the West Midlands and Lord Mayor of Belfast City Council, for example, should have this forum to speak directly to central government about what extra resources would be useful to them. Devolution should also involve and require empowering communities at the subnational level (hence this English civic representation) which will help build connections across the Union.
Finally, after Brexit, as the UK resumes competence for various areas of policy previously held by the EU – such as competition, product standards and science policy – it must ensure statutory and regulatory bodies have representation from Scotland, Wales and Northern Ireland. The UK Government must recognise that Brexit doesn’t just mean taking back control for Parliament, important though that is, but taking back control for all the nations and peoples of the United Kingdom.