James Evans examines the London-centric nature of the UK economy.
‘I wish I was in London//That’s where I want to be’, sang Thea Gilmore in the song chosen for the closing video montage for the London 2012 Olympics. Many Brits must be thinking along those lines at the moment: analysis revealed last week in the Guardian newspaper indicates that regional disparities in the UK economy have worsened since the 2007 credit crunch, with only London, the South East, and Scotland experiencing economic growth. Breaking Scottish economic news has been dominated by the story of the shutdown of Grangemouth oil refinery, putting 2,600 jobs at risk…
It seems that neither the promises of politicians to rebalance the economy nor the bile spewed upon unpalatable bankers’ bonuses have diminished the reality of London’s predominance. Perhaps this is unsurprising: our politicians have limited economic levers and also need to make the best of our wealthiest assets. Whilst we should be grateful for the revenue which the capital and its surrounding area is generating, this situation does create a number of difficult political choices. In particular, how far should politicians invest their energies in boosting what’s already working, and how far should they concentrate on fixing the problems elsewhere? There is a danger of falling prey to a protectionist mentality which accepts that we can only win in London! Then again, it was thanks to this London-thinking that we won the right to host the 2012 Olympics; London enjoys esteemed status in the eyes of the global community.
Whilst we should be grateful for the revenue which the capital and its surrounding area is generating, this situation does create a number of difficult political choices.
One very good example of where key decisions have to be made about how far to stimulate various regions is in relation to transport infrastructure. The government continues to affirm its priority commitment to regional growth through the delivery of HS2. The business community in London continues to lobby vigorously for prioritising the expansion of London’s airports. Boris Johnson is meanwhile building CrossRail and campaigning for CrossRail 2. Is it more important to ministers to promote growth outside the commuter belt or within it?
Neither focus would significantly alter the economic imbalance within this country. Even HS2 leads to London, after all. Unless and until some other community within the UK achieves significant international recognition and investment, most of the money and therefore most of the jobs and infrastructure will be staked on our one big winner: London.