In the middle of a crisis, it can be easy to lose sight of long-term policy priorities.
The current cost of living crisis is hitting people hard, exacerbating the existing inequalities that have long been a feature of our society. The levelling up agenda was pitched by the Johnson government as the long-term solution to these problems – a plan to “challenge and change” the unfairness of regional inequality.
Since then, our attention has been gripped, first, by political crises and, now, by more pressing economic ones, at the expense of thinking about long-term policy solutions to these challenges. Just this week, the Times reported that some MPs in marginal seats have been discouraged from using the term ‘levelling up’, leaving the door open to some interpreting this as a sign of a government looking to quietly distance itself from prior commitments.
This would be a serious mistake: the government should continue to prioritise the levelling up agenda alongside the cost of living crisis, to ensure people are better off and more resilient in the future. The government also needs to step up its cost of living support, so that ongoing levelling up projects are not hampered by the lack of money in people’s pockets.
Levelling up has been the subject of significant political attention since the government published the long awaited white paper on the topic last year. At Demos, we thought it was important to carry out a progress check. We wanted to understand how levelling up was going and what lessons could be learned for the future. We chose to visit the Tees Valley, where Conservative metro mayor Ben Houchen has made levelling up his flagship policy.
If levelling up was going to work anywhere, all evidence suggests it would be in the Tees Valley. Not least because it needs to succeed there – the North East has some of the starkest unemployment, child poverty and health statistics of anywhere in the country.
Levelling up in the Tees Valley is a work in progress, but people are worried about the impact of the cost of living crisis.
What we found, based on focus groups with the ordinary people who live there, was that people had faith in the local levelling up agenda – restoring the area as a leader in industry and creating more jobs was something people supported. However, many had not seen much progress so far. One person told us they thought levelling up had “ground to a halt”.
A lack of employment opportunities was a common concern – several people had either family members or friends who were struggling to find work. Some felt the levelling up agenda had not yet delivered new jobs on the scale they had been promised. People were worried about the impact of the cost of living crisis on themselves and their families, but also on the viability of local businesses and the local economy. With less money in the pockets of local people, our participants questioned whether the restaurants, bars and cafes being opened as part of local town centre regeneration projects would survive.
Our research also found that people were concerned about the future of the levelling up agenda more generally. They questioned whether the national economic crisis meant that the government would reduce the amount of funding allocated to areas like Tees Valley for levelling up projects. One person asked, “How long will this levelling up funding keep coming? Will that be put on hold?”.
This is not just a problem for families or businesses in the short term – it represents a longer-term problem for the resilience of communities. A continuous cycle where an area like the Tees Valley benefits from investment, only to suffer when an economic crisis comes along, benefits no one. It is vitally important that the government adequately addresses the cost of living crisis now, to sure up the future prosperity of places across the country.
The success of the levelling up agenda depends on effectively addressing the cost of living crisis.
What our research shows is that the success of the levelling up agenda in the long term depends upon how effectively people are supported through the cost of living crisis in the short term. Levelling up policy must be connected to cost of living policy in a meaningful way, across the country, for the government to fulfil its promise. We recommend making the current cost of living support more accessible, significant and longer term. This could mean bringing forward and extending cost of living measures, as well as expanding the eligibility of households to claim cost of living payments after April 2023.
It should also mean assessing the impact that cost of living support will have on local government funding in the long term, and accelerating levelling up initiatives rather than putting them on hold.
Levelling up is a long-term agenda, designed to address long-term problems. However, the cost of living crisis has exacerbated the poverty and inequality that already existed in many places across the country. These problems are not only having a profound impact on people’s quality of life, ability to pay their bills or find work, but are also hampering the success of the levelling up agenda. To effectively level up the country and address regional inequality, the government must step up and protect people from the cost of living crisis now.
Courtney Stephenson is a researcher at Demos. She is the author of the recent Demos Report on levelling up and the Tees Valley.
