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Hope Under Neoliberal Austerity

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England, along with a range of new service industries (UK2070 Commission, 2019: 34). Policies since the 1990s attempted to ameliorate the immediate impacts of decline rather than unlocking opportunities, and developed an approach of managed decline of ‘left-behind’ places. The UK2070 Commission’s report draws a comparison between East and West Germany, which were much more spatially unequal than Britain in the 1990s; however, through a deliberate and unificationist policy, the situation was reversed, so that the UK is now regionally more unequal than Germany. Since the strong Conservative victory in the 2019 elections, including new gains of many traditionally Labour constituencies in the North East, various announcements have been made about ‘levelling up’ the English regions (Scott, 2019; Giles, 2020). The evolving COVID-19 crisis is likely to exacerbate existing spatial inequalities in the labour market. Although London has the highest percentage of self-employed workers (15 per cent), the self-employed in the cities of the North and Midlands have increased precarity, and more people in London and the South East are employed in occupations that can switch to home and remote working (Magrini, 2020). Within-region labour market inequalities between cities and towns in the North will become starker during COVID-19 as some Northern cities (such as Newcastle, Manchester, Warrington and Leeds) have been identified as having different economies that will better adapt to homeworking (Magrini, 2020). Pre-crisis proclamations of levelling up between the regions will need to account for these different regional and local economies and experiences once the COVID-19 crisis is over, as well as any implications of Brexit. However, based on the preference for a project-based as opposed to programmatic policy style, this may work to mitigate the uneven regional impacts of Brexit and COVID-19, rather than achieving a reduction in regional disparities.

      Conclusion

      Various challenges, which are either rooted in history or arise from increased global connectedness, confront today’s North East. Disadvantageous trading agreements following Brexit would have a major impact on the North East industrial sector. Some, however, hope that a weaker pound might create advantageous conditions for new trading agreements, though this has not been borne out by the actual figures since the Brexit vote (Edwards et al, 2018), at least until the COVID-19 crisis caused the pound’s value to tumble in early 2020. At the same time, EU subsidies have been important to the North East region. Between 2007 and 2020, the North East received over £800 million of EU structural funds, utilised in programmes investing in businesses, innovation, reducing firms’ emissions and upskilling workers (South Tyneside Council, 2017). Post-Brexit forecasts for the region anticipate the loss of the relatively politically neutral redistribution of EU regional funding streams, leading to further economic stress and sharpening the North–South divide, both economically and politically.

      While EU structural funds are to be replaced by a UK Shared Prosperity Fund after the EU funding ends in 2020, concerns surround how it will operate, including: whether it will match or exceed EU investment; whether it will be devolved to regional decision-making or tightly controlled from the centre; whether there will be a smooth transition between EU and UK funds (Cowie et al, 2018); and whether the funds will become more politicised (Bell, 2017). Furthermore, the probable choice of the urban-located Local Enterprise Partnerships to manage the new fund has raised concerns over the future equity of distribution between urban and rural areas (Dwyer, 2018), which is of significance for the growing population of the North East that lives outside of its cities.

      As this chapter has indicated, the North East region has an influential and varied cultural heritage, outstanding and diverse landscapes, with many distinctive cities, towns and villages, offering the potential for an excellent quality of life. Regional inequalities in wealth, prosperity and health, the effects of austerity, and the implications of Brexit present challenges for the foreseeable future. The outlook is uncertain for the economy and bleak for the vulnerable; however, the strength of the region rests in its people, and the case studies in the following chapters describe some of the initiatives that are offering hope.

      References

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