The UK's regional income divide remains stubbornly persistent, despite decades of promises from governments to bridge the gap. This is a critical issue that demands urgent attention, especially as Andy Burnham, the prime minister-in-waiting, prepares to take on the challenge of rebalancing Britain's economic geography. The Resolution Foundation's report highlights a stark reality: despite efforts, the divide in household income between the richest and poorest regions has barely budged in over 30 years.
What makes this situation particularly concerning is the persistence of high income inequality at both local and regional levels. The report reveals that the income gap between London and Northern Ireland has remained largely unchanged since 1997, with London's gross household disposable income per person at £27,900 and Northern Ireland's at £17,300. This disparity is even more pronounced when considering the local authorities within these regions. The richest area, Kensington and Chelsea, has a disposable income of £60,584, while the poorest, Leicester, has an income of £13,398, a gap that has persisted for almost three decades.
The report underscores the entrenched nature of these divisions, noting that over half of the local authorities in the poorest fifth of places for income per person in 1997 were still in that position in 2023. Conversely, 82% of the richest places had maintained their top positions. This persistence of inequality despite government promises to 'level up' Britain's economy is a cause for deep concern.
One of the key challenges highlighted is the lack of investment in transport, housing, and regeneration projects. The Resolution Foundation argues that the UK's 'levelling-up' spending in 2022 was a mere £4bn, a fraction of the £70bn allocated by Germany for post-cold war reintegration. This disparity in investment underscores the urgency of the situation and the need for a more comprehensive approach to address regional inequality.
Manchester, a city that has shown some economic revival, serves as a glimmer of hope. The city's gross household disposable income per person has grown by 40% in real terms since 1997, but it still lags behind London and other major northern cities. This progress, however, is not enough to address the broader regional disparities. The report emphasizes that sustained investment is crucial, and it is unclear whether Burnham's plans can overcome the constraints on public finances.
In my opinion, the UK's regional income divide is a complex issue that requires a multi-faceted approach. While efforts to 'level up' the economy are commendable, they must be backed by substantial investment in infrastructure, housing, and economic development. The challenge for Burnham and future leaders is to turn ambition into reality, ensuring that the economic and political costs of Britain's geographic divides are not borne by the regions left behind.
