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Government in denial over North-South divide
06 August 2007
Ten years of Labour Government has failed to close the gap in prosperity between north and south, according to new research from ippr north to be published in October.
A full sub-regional breakdown for average income is at the end of this release.
ippr north’s report cites Government figures that measure the gap between regions. These figures show that since 1997, the North East, the North West, Yorkshire and Humberside and the Midlands have all moved further away from the national average, on the Government’s favoured measure of output per head (known to economists as ‘Gross Value Added’). Over the same period, London has out paced the rest of Britain.
ippr north’s report shows that the Government’s target (which was set by Gordon Brown in 2002) has only been to reduce the average rate of growth between two groups of regions:
- on the one hand, the North East, the North West, Yorkshire and Humberside the East and West Midlands and the South West, and;
- on the other hand, London, the South East and the East of England.
The report says this target is inadequate and has led to too little attention and resources going into addressing the north-south divide. The Government is reviewing all its targets in this October’s Comprehensive Spending Review.
Sue Stirling, Director of ippr north, says:
“The Government needs to get real on the north-south divide. At the moment, it is in denial. The Government has not explicitly targeted the gap between rich and poor, nor the gap between north and south. As a result, the work of Labour’s Regional Development Agencies has only succeeded in reducing the north’s relative decline.
“The standard Government line on the north-south divide is that inequalities within regions are as dramatic as those between regions. This is true but just because you deal with inequalities within regions it does not mean you should ignore inequalities between regions.
“This October’s Comprehensive Spending Review will almost certainly scrap the Government’s current target, and not before time. But we need a proper target to replace it that explicitly focuses on the gap between north and south.”
ippr north’s report recommends a new target to reduce the absolute gap in levels of GVA between regions, not just the gap between growth rates. The target should apply to individual regions, not groups of regions. One way of operationalising this would be to have a conditional target, whereby a region whose GVA growth was below average would have the target of achieving above-average growth over the target’s time horizon (in the case of the 2002 PSA target the time horizon was set at 6 years). For regions with above-average growth the target would not apply in the same way as their performance would already be above average – they could be tasked with maintaining their current growth rate.
Notes to editors
The Northern Economic Agenda by Howard Reed, Olga Mrinska and Michael Johnson will be published by ippr north in the autumn.
The Government’s current target is to:
"Make sustainable improvements in the economic performance of all the English regions by 2008, and over the long term reduce the persistent gap in growth rates between the regions, demonstrating progress by 2006."
The Government’s recently published Sub-National Review proposes regionalising this aim by giving each region a single over-arching growth objective aimed at increasing the regional Gross Value Added (GVA) per head. It also sets Regional Development Agencies five outcome-based performance indicators: GVA per hour worked, employment rate, skills attainment, research and development spending as GVA percentage, and business start-ups. But the new objectives do not address the gaps between regions.
Gross Value Added (GVA) per head by region
|
|
1997 |
2005 |
|
United Kingdom |
100 |
100 |
|
|
|
|
|
North East |
81 |
79 |
|
North West |
90 |
88 |
|
Yorkshire & the Humber |
90 |
87 |
|
|
|
|
|
East Midlands |
94 |
93 |
|
West Midlands |
93 |
89 |
|
|
|
|
|
East of England |
107 |
107 |
|
London |
129 |
136 |
|
South East |
114 |
115 |
|
South West |
93 |
94 |
|
|
|
|
|
England |
102 |
102 |
|
Wales |
81 |
78 |
|
Scotland |
99 |
96 |
|
Northern Ireland |
81 |
80 |
Latest figures for annual average income per head (£ per head)
|
UK |
£13,302 |
|
|
|
|
England |
£13,486 |
|
|
|
|
North East |
£11,407 |
|
|
|
|
TeesValley and Durham |
£11,380 |
|
Hartlepool and Stockton-on-Tees |
£11,402 |
|
South Teesside |
£10,980 |
|
Darlington |
£11,670 |
|
Durham CC |
£11,531 |
|
|
|
|
Northumberland and Tyne and Wear |
£11,430 |
|
Northumberland |
£12,833 |
|
Tyneside |
£11,223 |
|
Sunderland |
£10,481 |
|
|
|
|
|
|
|
North West |
£12,199 |
|
|
|
|
Cumbria |
£12,814 |
|
West Cumbria |
£11,850 |
|
East Cumbria |
£13,693 |
|
|
|
|
Cheshire |
£13,989 |
|
Halton and Warrington |
£12,628 |
|
Cheshire CC |
£14,617 |
|
|
|
|
Greater Manchester |
£11,833 |
|
Greater Manchester South |
£11,956 |
|
Greater Manchester North |
£11,691 |
|
|
|
|
Lancashire |
£11,768 |
|
Blackburn with Darwen |
£9,970 |
|
Blackpool |
£11,085 |
|
Lancashire CC |
£12,070 |
|
|
|
|
Merseyside |
£11,810 |
|
East Merseyside |
£10,992 |
|
Liverpool |
£10,914 |
|
Sefton |
£12,576 |
|
Wirral |
£13,255 |
|
|
|
|
|
|
|
Yorkshire and the Humber |
£12,224 |
|
|
|
|
East Riding and North Lincolnshire |
£12,012 |
|
Kingston upon Hull, City of |
£10,416 |
|
East Riding of Yorkshire |
£13,460 |
|
North and North East Lincolnshire |
£11,768 |
|
|
|
|
North Yorkshire |
£13,784 |
|
York |
£12,810 |
|
North YorkshireCC |
£14,096 |
|
|
|
|
South Yorkshire |
£11,696 |
|
Barnsley, Doncaster and Rotherham |
£11,428 |
|
Sheffield |
£12,089 |
|
|
|
|
West Yorkshire |
£12,068 |
|
Bradford |
£11,348 |
|
Leeds |
£12,395 |
|
Calderdale, Kirklees and Wakefield |
£12,192 |
|
East Midlands |
£12,543 |
|
|
|
|
Derbyshire and Nottinghamshire |
£12,251 |
|
Derby |
£11,708 |
|
East Derbyshire |
£11,863 |
|
South and West Derbyshire |
£12,881 |
|
Nottingham |
£10,071 |
|
North Nottinghamshire |
£12,264 |
|
South Nottinghamshire |
£13,877 |
|
|
|
|
Leicestershire, Rutland and Northamptonshire |
£12,933 |
|
Leicester |
£10,550 |
|
Leicestershire CC and Rutland |
£13,684 |
|
Northamptonshire |
£13,221 |
|
|
|
|
Lincolnshire |
£12,489 |
|
Lincolnshire |
|
|
|
|
|
West Midlands |
£12,134 |
|
|
|
|
Herefordshire, Worcestershire and Warwickshire |
£13,570 |
|
Herefordshire, County of |
£12,394 |
|
Worcestershire |
£13,508 |
|
Warwickshire |
£14,029 |
|
|
|
|
Shropshireand Staffordshire |
£12,393 |
|
Telford and Wrekin |
£11,598 |
|
Shropshire CC |
£13,181 |
|
Stoke-on-Trent |
£10,372 |
|
Staffordshire CC |
£12,862 |
|
|
|
|
West Midlands |
£11,281 |
|
Birmingham |
£10,961 |
|
Solihull |
£15,162 |
|
Coventry |
£11,167 |
|
Dudley and Sandwell |
£10,954 |
|
Walsall and Wolverhampton |
£10,813 |
|
East of England |
£14,159 |
|
|
|
|
East Anglia |
£13,166 |
|
Peterborough |
£12,838 |
|
Cambridgeshire CC |
£14,268 |
|
Norfolk |
£12,322 |
|
Suffolk |
£13,310 |
|
|
|
|
Bedfordshire and Hertfordshire |
£15,126 |
|
Luton |
£11,308 |
|
Bedfordshire CC |
£13,902 |
|
Hertfordshire |
£16,263 |
|
|
|
|
Essex |
£14,569 |
|
Southend-on-Sea |
£14,172 |
|
Thurrock |
£12,436 |
|
Essex CC |
£14,849 |
|
|
|
|
|
|
|
London |
£15,842 |
|
|
|
|
Inner London |
£17,198 |
|
Inner London - West |
£22,441 |
|
Inner London - East |
£13,973 |
|
|
|
|
Outer London |
£14,948 |
|
Outer London - East and North East |
£13,533 |
|
Outer London - South |
£15,719 |
|
Outer London - West and North West |
£15,715 |
|
|
|
|
South East |
£14,898 |
|
|
|
|
Berkshire, Buckinghamshire and Oxfordshire |
£15,496 |
|
Berkshire |
£15,034 |
|
Milton Keynes |
£13,943 |
|
Buckinghamshire CC |
£17,415 |
|
Oxfordshire |
£15,159 |
|
|
|
|
Surrey, East and West Sussex |
£15,856 |
|
Brighton and Hove |
£13,966 |
|
East SussexCC |
£13,830 |
|
Surrey |
£17,785 |
|
West Sussex |
£15,092 |
|
|
|
|
Hampshire and Isle of Wight |
£13,704 |
|
Portsmouth |
£11,338 |
|
Southampton |
£11,173 |
|
Hampshire CC |
£14,720 |
|
Isle of Wight |
£11,787 |
|
|
|
|
Kent |
£13,911 |
|
Medway |
£12,820 |
|
Kent CC |
£14,111 |
|
|
|
|
|
|
|
South West |
£13,260 |
|
|
|
|
Gloucestershire, Wiltshire and North Somerset |
£13,710 |
|
Bristol, City of |
£12,446 |
|
North and North East Somerset, South Gloucestershire |
£13,979 |
|
Gloucestershire |
£13,653 |
|
Swindon |
£13,854 |
|
Wiltshire CC |
£14,481 |
|
|
|
|
Dorset and Somerset |
£13,558 |
|
Bournemouth and Poole |
£13,547 |
|
Dorset CC |
£14,037 |
|
Somerset |
£13,192 |
|
|
|
|
Cornwalland Isles of Scilly |
£12,101 |
|
|
|
|
Devon |
£12,573 |
|
Plymouth |
£11,635 |
|
Torbay |
£11,807 |
|
Devon CC |
£13,029 |
Contacts
Matt Jackson, ippr senior media officer, 020 7339 0007 / 07753 719 289 / m.jackson@ippr.org
Richard Darlington, ippr media manager, 020 7470 6177 / 07738 320 645 / r.darlington@ippr.org

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