The creation of a Northern Powerhouse is a bold and innovative pledge which seeks to empower northern cities by injecting a healthy dose of devolution into the veins of the body politic. This conurbation will undoubtedly go far to redressing the economic disparity between London and the north, but if the Conservatives intend to fulfil their promise to govern as a one-nation party, they must also enable the south-west to realise its full potential.
At 77.3%, the employment rate in the south-west is the highest in the UK. This is surely a welcome indicator of economic recovery, yet its long-term growth still lags behind the UK average, a difference highlighted by George Osborne in January when he expounded the Conservatives’ economic plan for the region. Moreover, its prosperity levels are far from homogenous: despite Cornwall’s timeless beauty and enduring appeal, a gulf separates its stuttering economy from the affluence of Bath. This imbalance was thrown into sharp relief last year by official EU statistics, which indicated that Cornwall is Britain’s joint poorest area: its inhabitants earn, on average, less than £14,300 per annum, rendering them 36% worse off than the EU norm and languishing behind former Communist countries such as Lithuania, Poland and Hungary. In an effort to stimulate the county’s economy, the European Regional Development Fund Convergence Programme pumped £465 million into Cornwall between 2007 and 2013, yet this failed to yield satisfactory results. Even taking into account the deleterious impact of the global recession, recent analysis revealed the ‘significant projected under-performance of the Programme in achieving its target results regarding jobs, Gross Value Added (GVA) and private sector investment.’ It is therefore imperative that the government does not focus too intensely on the formation of a Northern Powerhouse at the expense of a Cornish poorhouse.
There is no obvious panacea for these issues, but investment in transport links is crucial if more vigorous growth is to be generated in the south-west. The Chancellor is to be commended for the specifics in his Emergency Budget on Wednesday: he allocated £2 million to upgrade the Treluswell Junction in Cornwall, where existing congestion ‘adversely affects the economy of Falmouth, Penryn and the surrounding area’, and pledged funding to support the development of a business case for improvements to the A391 and the North Devon Link Road. On a broader scale, the government has already committed £7.2 billion to transport infrastructure in the south-west, including £2 billion to upgrade key roads such as the A30, A303, A358 and the M5. A tunnel will also be built under Stonehenge, where frustrated drivers can attest to the increased weight of traffic since the A344 was turfed over in 2013.
The electrification of the Great Western Main Line and the unrolling of a new Intercity Express rail franchise will further integrate the region by enhancing capacity and journey times, whilst the benefits of these rail links will be complemented by the supply-side policy of transforming digital connectivity. Yet comprehensive improvements to rail services in the far south-west are missing from these proposals. The coastal route is vulnerable to severe flooding and storms – as demonstrated by the damage wreaked on Dawlish station in February 2014 – and the government should seize the initiative and commit wholeheartedly to this chronically under-invested region. Increasing the resilience and reliability of the line and extending the electrification programme as far as Paignton, Plymouth and Penzance – as advocated by the Peninsula Rail Task Force – are just some of the measures which would modernise this network and help the area to reap the rewards of Britain’s economic recovery. It is encouraging that progress towards a devolution deal for Cornwall is being made, as this will allow the local authorities to implement schemes and boost growth more efficiently.
Opportunities to foster growth and prosperity abound throughout the south-west, from supporting the thriving tourist industry to investing in agriculture and developing a cyber-security stronghold which would contribute to the nation’s economy and deliver tangible benefits to local communities. The Conservatives triumphed in the region on 7th May, and thus have a clear mandate to revitalise its economy. They must not lose sight of this goal.