Making the Levelling Up Fund work for the North

The government must make sure that its new £4bn Levelling Up Fund genuinely delivers for the North of England, writes Tracy Harrison of the NHC.
Tracy Harrison, chief executive of the Northern Housing Consortium.
Tracy Harrison, chief executive of the Northern Housing Consortium. Credit: NHC

One year ago this week, Boris Johnson launched the Conservative election manifesto, with a promise to ‘unleash the potential of our whole country’.

12 months into his majority government, he might have hoped his government would have made more progress with its plan to level-up and ‘forge a new Britain’.  Instead, this week his chancellor has set out just a single year of spending plans – COVID-19 delaying his plans for a multi-year spending review.

In that context, and in the light of an eye-watering fiscal outlook, the fact that the chancellor has found £4 billion to invest in the new Levelling Up Fund is a significant statement of intent.  It’s especially important for the North, because historically the region has been excluded from accessing the lion’s share of some big funding pots. A fund of this scale, focused on levelling-up, might be expected to redress some of the balance.

So, what is the chancellor expecting for his £4 billion? A lot. His speech described the pot as being intended to fund the ‘infrastructure of everyday life’ – projects that will have a visible impact in local communities and will support economic recovery. Examples given are local transport schemes, tackling eyesores, and upgrades to local town centres. The chancellor wants to see a visible difference – and he wants to see it by the end of this parliament.

The Northern Housing Consortium has long-argued for flexible, place-based regeneration funding, so we welcome the ambition the chancellor is showing with a fund of this scale.  And housing-led regeneration can deliver visible changes at pace.  But beneath the £4 billion headlines lie the detail.

Firstly, this is a competitive fund. So once again, Northern places will find themselves preparing bids to be sent off to Whitehall, asking for up to £20 million to deliver on very local priorities. Aside from the fundamental question of why Whitehall is best placed to judge what’s right for Whitehaven, there is also the very practical issue of the capacity devoted to writing speculative bids.  Councils in the North have lost 71% of their economic development capacity since 2010/11. It’s a brave council CEO or leader who prioritises speculative bid writing – with costs estimated at tens of thousands per bid – at a time when services are under pressure like never before.  

Secondly, the Levelling Up Fund adds to a complex policy landscape. Many places are already engaged in Towns Fund planning. But the Spending Review added two other multi-billion funds in the form of the Shared Prosperity Fund (SPF) and the National Home Building Fund (NHBF). If we’re to maximise the impact of £20 million investments, and create the step change we all want to see, then investment must be aligned with mainstream funds like the SPF and NHBF.  The Green Book Review launched this week shows real promise in terms of correcting some of the ways of working which have prevented these large funds from reaching parts of the North.

The good news is that the Levelling Up Fund prospectus won’t be published until early next year, so there’s still time for government to set out ways of working that allow this £4 billion investment to secure greatest impact.  We would suggest:

  • Learning lessons from the £400 million Brownfield Housing Fund, which was allocated directly to Northern Combined Authorities, so they could utilise it to further existing strategies
  • Backing capital investment with capacity funding and support to enable places to make best use of funds allocated – as was done with the recent Towns Fund (which provided at least £140,000 to each place for engagement, planning and development)
  • Using the forthcoming Devolution and Local Growth White Paper to review the landscape of regeneration funding and put local places in the driving seat with flexible funding and local decision-making.

We all want to make the North an even better place to live. £4 billion for the ‘infrastructure of everyday life’ is welcome – but it’ll deliver so much more if it’s integrated with the existing local funding and decision-making infrastructure.

Tracy Harrison is chief executive of the Northern Housing Consortium

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