‘Continental’ Powerhouse?

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The Centre for Cities, which aims to help improve the economic performance of UK cities, has released a report which looks at how the Northern Powerhouse compares with the Randstad, in the Netherlands, and the Rhine-Rhur, in Germany; both of which represent similar areas that are made up of a number of cities.

Perhaps the main aspect that has come out of the Northern Powerhouse debate so far has been the need to improve infrastructure across the region, especially transport links between the major cities. This report, however, has said that both the Randstad and Rhine-Rhur have similar transport links to those in the North, yet their productivity is much higher compared to other regions in the Netherlands and Germany, respectively.

This can be shown by looking at the figures: the Randstad has a population of 7,400,000, with 3,950,000 jobs, and a GVA of £246 billion. The Northern Powerhouse has a population of 15,200,000, with 5,780,000 jobs, but a GVA of just £297 billion. Despite having over double the population of the Randstad, the overall productivity of the Northern Powerhouse is just over 20% greater.

It is argued in the report that, while wider transport links are important, it is vital that the cities and city regions themselves improve their performance by increasing business density in city centres, improving the skills of residents (something touched upon recently by the IPPR North), and creating better transport links within city regions.  This begs the question, is HS3 as important as we think? It’s been a strong argument for the Northern Powerhouse that someone in Sheffield, for example, can commute and work in Manchester. However, this report suggests that it is perhaps more important to focus on attracting the talent that is, or should, already be found within the catchment of a city centre itself, as with those in the Randstad or Rhine-Rhur.

In short, the report does not hold back when it says the North is punching well below its weight, especially when compared to the Greater South East of England. If the Powerhouse vision is to be realised, it is up to the individual cities to look at themselves first, as only then will it be worth linking them together. We have recently talked about the proposed need for a ‘Cabinet of the North’, but this may be less important than many would have us believe. In terms of development, depending on how seriously the city regions take the report, we could see more pressure to build in areas outside of city centres (and in some cases inside) in order to make it easier for people to, say, live in parts of Lancashire and Cheshire and commute to Manchester. With almost constant concern over the costs of creating high-speed rail links, we could see a gradual change of focus over the next few months and years. Whatever happens, it’s clear that there is a lot of private and/or public investment needed before the Northern Powerhouse becomes a reality.

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