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London 'to grow twice as fast as north despite Conservative policies' London 'to grow twice as fast as north despite Conservative policies'
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The economic gap between London and other major cities will widen significantly in the next 10 years, undermining the chancellor’s push to create a “northern powerhouse”, according to a report.The economic gap between London and other major cities will widen significantly in the next 10 years, undermining the chancellor’s push to create a “northern powerhouse”, according to a report.
London’s economy is forecast to grow by 27% by 2025 – almost twice the combined rate of growth in northern English cities, the report by law firm Irwin Mitchell and the Centre for Economics & Business Research (CEBR) found. London’s economy is forecast to grow 27% by 2025 – almost twice the combined rate of growth in northern English cities, the report by law firm Irwin Mitchell and the Centre for Economics & Business Research (CEBR) found.
The economy of London will be worth almost £450bn in 10 years – more than £110bn more than the total output of cities in the north west, the north east and Yorkshire and the Humber, the report, ‘UK powerhouse: supporting economic strength and bridging the prosperity gap’, found. The economy of London will be worth almost £450bn in 10 years – more than £110bn higher than the total output of cities in the north-west, the north-east and Yorkshire and the Humber, the report, UK Powerhouse: Supporting Economic Strength and Bridging the Prosperity Gap, found.
The findings take account of the proposals announced by George Osborne to revitalise Greater Manchester and other northern cities by improving transport links and devolving powers from Westminster. The project is centred on Greater Manchester and largely ignores the north east. Osborne declared Sheffield as a second powerhouse last week. The findings take account of the proposals announced by George Osborne to revitalise Greater Manchester and other northern cities by improving transport links and devolving powers from Westminster. The project is centred on Greater Manchester and largely ignores the north-east. Osborne declared Sheffield as a second powerhouse last week.
The report, published before the chancellor’s speech to the Conservative party conference, found that business leaders in the north were unenthusiastic about the government’s HS2 high speed rail link as a way to revitalise their cities. HS2 will run from London to Birmingham at first and will then be extended to the north west. The report, published before the chancellor’s speech to the Conservative party conference, found that business leaders in the north were unenthusiastic about the government’s HS2 high-speed rail link as a way to revitalise their cities. HS2 will run from London to Birmingham at first and will then be extended to the north west.
Businessmen favoured improving roads and local rail services over HS2. More than half the 1,000 surveyed by YouGov for the report wanted local decision making on business rates and infrastructure improvements. Many also wanted a local living wage instead of the national rate introduced by the chancellor.Businessmen favoured improving roads and local rail services over HS2. More than half the 1,000 surveyed by YouGov for the report wanted local decision making on business rates and infrastructure improvements. Many also wanted a local living wage instead of the national rate introduced by the chancellor.
Scott Corfe, head of macroeconomics at CEBR, said: “After winning the May general election, David Cameron vowed to lead a ‘One Nation’ Conservative government. Yet significant announcements to spread growth across the UK have been surprisingly lacking to date.” Scott Corfe, head of macroeconomics at CEBR, said: “After winning the May general election, David Cameron vowed to lead a ‘one nation’ Conservative government. Yet significant announcements to spread growth across the UK have been surprisingly lacking to date.
“Without more radical measures, David Cameron risks breaking his vow, particularly as further austerity has the potential to hold back the economies of some of the UK’s poorest regions. It is vital that private enterprise is allowed to thrive in these regions as a way of offsetting austerity.”“Without more radical measures, David Cameron risks breaking his vow, particularly as further austerity has the potential to hold back the economies of some of the UK’s poorest regions. It is vital that private enterprise is allowed to thrive in these regions as a way of offsetting austerity.”
CEBR backed the business leaders’ views and proposed other measures including tax competition between regions, more enterprise zones around universities and the devolution of air passenger duty in England.CEBR backed the business leaders’ views and proposed other measures including tax competition between regions, more enterprise zones around universities and the devolution of air passenger duty in England.
Four of the five fastest-growing urban centres in the UK are in the south of England: London, Milton Keynes, Cambridge and Oxford – along with Aberdeen. The slowest-growing cities are Hull, Bradford, Middlesbrough, Swansea and Belfast.Four of the five fastest-growing urban centres in the UK are in the south of England: London, Milton Keynes, Cambridge and Oxford – along with Aberdeen. The slowest-growing cities are Hull, Bradford, Middlesbrough, Swansea and Belfast.
CEBR predicted that the gap would persist over the next decade without more action to invigorate underperforming cities. It said London will gain more than 537,000 jobs, up 11.1%, compared with increases of 8.6% for Greater Manchester, 7.6% for Leeds and 6.9% for Sheffield by 2025.CEBR predicted that the gap would persist over the next decade without more action to invigorate underperforming cities. It said London will gain more than 537,000 jobs, up 11.1%, compared with increases of 8.6% for Greater Manchester, 7.6% for Leeds and 6.9% for Sheffield by 2025.
Niall Baker, head of business legal services at Irwin Mitchell, said: “Although it is good news that London and the South East will continue to prosper, it’s clear that a radical rethink of the government’s wealth spreading agenda is required. Investment in infrastructure is one part of the mix and we believe that the government needs to listen to the voice of business and employ a range of policies tailored to different regions.” Niall Baker, head of business legal services at Irwin Mitchell, said: “Although it is good news that London and the south-east will continue to prosper, it’s clear that a radical rethink of the government’s wealth spreading agenda is required. Investment in infrastructure is one part of the mix and we believe that the government needs to listen to the voice of business and employ a range of policies tailored to different regions.”