12 May 2021

How can we track the ‘levelling up’ agenda? A new Prosperity Index is a good place to start

By Matthew Goodwin

Brexit, the Covid-19 recovery, and the ‘levelling-up’ agenda have all brought the United Kingdom to a ‘reset moment’ – an opportunity to reboot the national settlement so that it works better for communities that have been left behind. It’s an admirable goal, but there remains considerable confusion about what ‘levelling up’ actually entails.

“What exactly are we trying to level up where? And how will we measure it?” asks Neil O’Brien MP, the newly appointed levelling-up adviser to the Prime Minister. Thinktanks, media, and civil servants are all asking how this new agenda can be tracked and monitored over time. 

This also has huge political implications. The unfolding ‘realignment’ of British politics is at least partly anchored in Boris Johnson’s promise to do more for people in places like Hartlepool, while any potential Labour recovery must run through the industrial heartlands of England.

Unless we have a method of evaluating progress at the local level then the levelling-up debate will always remain too abstract while regions, local authorities, and citizens will have no means of holding government to account.

This is why the Legatum Institute is this week launching the UK Prosperity Index, a tool that draws on more than 70 established datasets to track the pathway to prosperity across 379 local authorities in all corners of the UK. It is designed to offer a meaningful way of tracking the progress of levelling-up over the next 10 years, to identify which areas are rising and which are falling, and why.

Our Index shows that the UK is continuing to build a strong and open economy by strengthening its labour force; businesses are competitive; and productivity is increasing. The quality of our infrastructure is improving, keeping people physically and digitally connected. Education also continues to improve – over the last decade, all regions have seen secondary school outcomes improve and more than three quarters of working age adults now have the equivalent of five good GCSEs, an increase from just two thirds 10 years ago. 

Declining carbon dioxide emissions is one aspect driving the improvement in the natural environment. Furthermore, more trees are being planted and an increasing proportion of waste is recycled. In addition, prior to Covid-19, poverty rates were reducing in many parts of the country and rough sleeping has fallen 43% in the last five years.  

However, these gains are today being undermined by issues that lie outside of the traditional focus on infrastructure and transport, on ‘bridges and trains’. These include a decline in the safety and security of communities due to rising violent crime; a deterioration in people’s mental and physical health; a reduction in the quality of healthcare; and an erosion of social capital, including family relationships. 

The Index shows a significant decline in the number of care home beds and in A&E performance. This deterioration in healthcare systems over the last decade has been experienced across all regions, with the greatest deteriorations in the East of England and the North East. 

Parts of the UK are also experiencing a loss of public trust in institutions. Engagement with local democracy is low in areas within the industrial heartlands, such as Barnsley; where the Index shows local election turnout is less than 30%. Crime is also on the rise in the industrial heartlands, with homicide rates as high as 17.8 homicides per 100,000 people in Warrington. Much of this is missed in the levelling-up debate that focuses narrowly on infrastructure and transport. 

The levelling-up agenda needs to be much more focused on non-economic aspects of prosperity, including social capital. Our Index shows that post-industrial areas like Middlesbrough have the lowest levels of social capital, with 10% of the population feeling lonely. Middlesbrough also has the second lowest level of trust in the local MP and the highest rates of teenage pregnancy in the country. 

Whilst many generalised indicators demonstrate the UK’s economic strength, it is notable that there has been a decline in the investment environment and enterprise conditions in many regions. For example, in Greater Manchester, just 1.6% of business are looking to invest in developing new processes. 

These aspects need to be included in the conversation. Levelling-up should be as much about health, safety and security, family, and entrepreneurship as things that are currently dominating the national conversation, like infrastructure. 

Our Index includes ONS statistics on income, skills, and productivity used by the Government in its funding formula for the £1bn Towns Fund, but its holistic nature means it provides a more accurate picture of experiences of residents and the investment potential of different areas. It provides a benchmark for every local authority in the UK to judge their prosperity, and can be used to hold the Government to account to ensure that investment reaches the areas that need it most.

By tracking these changes we can shed light on the areas where policy is having a real impact on local communities, and where it isn’t – taking ‘levelling up’ from rhetoric to reality.

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Professor Matthew Goodwin is the Director of the Legatum Institute’s Centre for UK Prosperity.

Columns are the author's own opinion and do not necessarily reflect the views of CapX.