Economic Leadership for Cities

Lord Monks Excerpts

Thursday 11th December 2014 Lords Chamber

[Lord Monks (Lab)]

My Lords, it is a pleasure to follow the noble Baroness, Lady Janke. She has just made an excellent start to her House of Lords career, as indeed have our other two debutants today—if one can refer to the noble Lords, Lord Goddard and Lord Scriven, as debutants on these occasions. As part of her background, the noble Baroness described her great wealth of local government experience that she brings from just about every corner of the country. That will make an enriching contribution to the work of this House as we proceed on this important issue of devolution within England. She remains a member of Bristol City Council, and first-line experience will therefore be brought to our deliberations. We look forward to many more well informed contributions from her in the years to come.

Our great cities, which boomed in the 19th century, had a lousy 20th century. There were two world wars, a prolonged depression in the 1920s and 1930s, and even in the post-war recovery, much of the rebuilding was shabby and ugly—and industrial decline set in. Very few new industries emerged in that period. Then there was the collapse—in some cases the partial collapse —of many of the cities’ staple industries in the 1980s. The result was some of the worst city centres in Europe outside the Soviet bloc. One had only to go to, say, Rotterdam or Hamburg—industrial cites both—to see the graphic differences.

In the 1990s, the cities began to improve—quickly in some places, more slowly in others. As has been said by the noble Lord, Lord Shipley, and my noble friend Lord McKenzie, the noble Lord, Lord Heseltine, deserves a mention in despatches for his contribution on Docklands, Liverpool, Manchester after the bomb, and now Hull. What a record that is. A new spirit began to emerge; remember Glasgow’s “Miles Better”, and Manchester’s impressive but perhaps improbable bid to host the Olympic Games? At least it stirred London into action.

In the more benign economic conditions that followed after 1993, big improvements became evident. Substantial public expenditure was a significant factor, enabling public/private deals on property; a retail and entertainment boom; expanding universities; and inward migration flows for the first time in a long time began to play a big part. Since the financial crisis of 2008-09, the cities have shown significant resilience in the face of the pressures: perhaps the pressure was greater in the smaller towns surrounding the newer city centres.

However, as the noble Lord, Lord Shipley said, the core cities underperformed the national average on GDP per head. There are still large areas of deprivation where poverty is all too evident and there is a shortage of solid private sector activity aside from discount stores, fast food outlets and betting shops. All the main parties are persuaded that devolution will help, spurred on by Scotland and perhaps by what has happened in London. City deals offer new opportunities for these cities to make further progress, with the Manchester city region setting the pace. I welcome these moves: they are overdue and I hope they can be widened. For example, Exeter is a city that I know, and it is beginning to do quite well. It needs to get help, encouragement and recognition for its contribution.

However, the condition of a lot of these cities remains fragile. The core cities are still heavily dependent on public expenditure, not just the local authority but the hospitals and universities as well. After the Autumn Statement, if we are going back to a state that is the same size as it was in the 1930s, what kind of guarantees and assurances can the Government provide that devolution will not be a devolution of responsibility with a big shortage of resources?