Why We Must Invest For Yorkshire’s Future

Doncaster Sheffield Airport – Closed since November 2022

We have failed to invest sufficiently in Yorkshire’s economy for at least the last fifty years. We have paid for this in the past, we are paying for it now, and we will pay dearly for it in the future unless this fundamental weakness is addressed as a matter of priority.

Yorkshire is not a rich region by Western European standards. It should be. Most of our equivalent neighbours in Western Europe fare much better than we do. At £142BN per annum, our GDP is less than half that of most of our equivalent neighbours. In order to be on a par with the UK average, Yorkshire’s GDP would have to be in the region of £205BN. That is over a £60BN shortfall each year.

Does it matter that our GDP is fairly low when GDP is increasingly criticised as being an inaccurate and inadequate measure of things like human wellbeing etc.? GDP should probably be treated as a purely economic measure, but yes, this does matter when it comes to paying for what we need in terms of necessities and good quality public services. In some cases, we actually rely on others to meet our needs but the cash cow that is London and the South East of England is no longer doing as well as it did so this situation may not be sustainable in the longer term. From the Yorkshire point of view, do we really want to be reliant on others when we could provide for ourselves?

The upshot is that by being poor we can no longer afford all the services that we need or that we desire. Are we prepared to do without them, or should we ensure that they are delivered?

How did this come about; is it our fault; and what can we do to rectify the problem?

Over the years industries come and go. Some are just replaced by progress. Others become uncompetitive and are forced out of business. Some are replaced as a direct result of government policy. Governments can do a great deal to prepare for these changes and to ensure that plans are in place to replace obsolete and declining industries with their modern “sunrise” replacements. Sometimes change can be so fast that even the best preparations prove inadequate. The tragedy for Yorkshire is that, for the most part, there was no preparation for these events.

Problems arose, therefore, through deliberate action, failure to keep up with progress, failure to remain competitive, and failure to address the issues and consequences. Call it deliberate action and neglect if you will. When a region declines it gradually becomes less attractive and competitive if action is not taken to address these problems.

As individuals there is not much we can do to address decline unless we are in a position to create new employment, industries, ways of working and so on. Some of the most talented of us not in this position just tend to leave which is even worse for those of us left, as the most talented often take their skills and knowledge to benefit other areas.

As individuals we do not have the authority to do many of the things we might wish to do to benefit the region but we do have the capability to elect others to do much of the work on our behalf. We give them the authority to carry out this work on our behalf and we provide them with the means to get the job done. Under the centralised UK political system, local authorities have some powers but the way the UK works is that most of the power is vested in the central government. The central government had the authority to address the problems of the region, but they generally failed to do so.

Westminster has failed us over the last 50 years.

We, of course, are responsible for electing the government but, when they failed to address the issues facing our region, we continued to elect the same people over and over again for around fifty years. Their policies may have differed slightly, but their methods and “solutions” were very similar. They consistently failed and we consistently continued to re-elect them. You could say that there are many other things to consider other than the economic wellbeing of our region and to a large extent the rest of country. This is true, but over a period the state of the regional economies, and Yorkshire’s in particular, should have worked its way to the top of the agenda. Ultimately, by continuing to elect people without the competence to get the job done, we have been responsible for our own demise.

Within the last ten years the idea of some form of devolution has become more popular as a means of addressing regional disparity. It has been adopted to a very limited extent with some positive results across some aspects of government, although there have also been problems with funding, demarcation and governance. The idea of real regional devolution, where responsibilities are matched by accountability and the funding to go with it, is frowned upon by those in government and by the leadership of the main opposition party, yet we still continue to elect the same people.

Make no mistake, failing to invest has cost us a great deal and it is still happening today. The closure of Doncaster Sheffield Airport is a prime example of the short-sighted incompetence that has bedevilled the Yorkshire economy for years. All the productivity that used to arise from the activities associated with that airport is now lost. We hope the airport can soon reopen so that it is not lost for good. In so many cases, though, places close and they are lost for good with nothing to replace them.

So, what has been the cost to us of this underinvestment and failure to properly nurture our economy over the last fifty years? Probably the best way to look at this is in current value terms. It gives an easily understandable illustration of what we have lost. The drawback is that it is an estimate. There are so many factors to take into consideration that it could be under or overstated by several billion pounds but as a general figure it should serve as a reasonable estimate. It will also give us some idea of what we are likely to lose in the future if we carry on as we are. This is not actual money we have lost but an estimate of income that we have not received. It is income which we could have received had sound economic policies been followed. The total value over 50 years expressed in current value terms is probably somewhere in excess of £2.5TN. When somebody tells you we cannot afford this or that, they may well be right, and this could be the reason why.

Is there a simple solution? The answer is no! Ireland grappled with this problem for years. Eventually they came up with a low tax, investment zone solution which has been copied by several countries, often quite successfully. The South Yorkshire Investment Zone is a small step in the right direction, but it is a small step, having achieved £80MN in funding with a possibility of increasing that to £1.2BN.

The particular circumstances of Ireland cannot be repeated elsewhere. It is a solution which has worked for them in their particular circumstances. It also has its problems, such as accusations levelled at the Irish government of “racing to the bottom” in terms of tax rates and income inequality within Ireland, but it has largely worked. We could take some of the ideas and apply them to our circumstances, but this would only be the South Yorkshire Investment Zone scaled up which simply would not address the scale of our problem.

Yorkshire really needs an economic and industrial strategy to target areas and industries for investment. We also need to be able to obtain and encourage investment in the region. We need to establish reliable income streams for investment purposes. The public sector can also play a part in this. Public sector investment is crucial in sectors such as infrastructure, health, education and transport.

Bradford City Hall – Public sector investment is crucial.

It is very easy to get caught up in the gloom and doom, but we must remember that Yorkshire has some very successful businesses and business clusters. We need to build on these and create many more so that we can project the image that Yorkshire is THE place to do business and that the community welcomes those entrepreneurs that are all about creating wealth for all the stakeholders they work with and not just about making a fast buck for their key investors who are often based outside the UK.

In the short term we need to kickstart shovel ready projects to get the economy moving up a gear. We will need funding for housing, hospitals, schools, transport and so on. These are not luxuries. They are essential projects that need to be done to replace the crumbling infrastructure that is already beyond its normal lifespan. They will provide immediate impetus for the economy while other projects can be brought on stream.

Private sector investment will be essential to us, so we need to go out there and bring it in. We need to make people aware of the opportunities presented by the region. We are a gateway to the UK and the EU and we should also be able to act as a bridge between east and west. We need a voice to be able to project our image and to shout about what we are, what we can do and, most of all, what we can do for you. The UK government does not do that for us. The UK government has made our trading position worse, not better. Why should another region of the UK be given preferential treatment over us?

Basically, the public sector can help kickstart things, but it will be the private sector that will put the icing on the cake. As stated above, private sector investment will be essential, but we should not forget about the opportunities presented by cooperative ownership. Cooperative enterprises tend to support the areas in which they are based and, as they are owned by employees, they tend to be resistant to the entreaties of hedge funds and corporate raiders.

In the longer term we need to be more focused on research and development. Among other things, we are desperately short of high-quality information on our environment, so we need to set up some research entities to get us ready to be able to deal with the challenges that we face. This could lead to Yorkshire becoming a centre of excellence in various sectors of research.

There are innovative ways of funding startup enterprises which are too detailed to be illustrated here but we will need to explore every which way we can to make a success of the Yorkshire economy. Our networking capabilities are woefully inadequate. All this will have to change.

The key problem of the failure of the Westminster UK government to give proper and due priority to Yorkshire’s needs remains. Westminster cannot be relied upon to deliver for us in the future. Devolution to an autonomous regional government is the only way we are going to make progress. If Westminster won’t help us, then they should give us the power to help ourselves.

In short, we are now much worse off than we should be because we failed to invest in our economy. We elected governments of various persuasions over the last fifty years to work on our behalf, but they were not competent enough to get the job done and they simply did not work for us. If we simply carry-on giving others outside Yorkshire power over our future when they have consistently failed to deliver over the last fifty years, then we deserve to fail. We have the opportunity to do the job ourselves. We should take it!

We must invest in Yorkshire’s future if Yorkshire is to have a future. This blog has considered the case for economic investment but there are many other types of investment that we also need to consider. I want Yorkshire to have a future. It is now clear that only Yorkshire can deliver that future. Our future belongs to us not Westminster.

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