Decentralisation needed to tackle North/South divide

Those who know me will know that I am not in the habit of quoting Conservative Prime Ministers, living or dead. I want to make an exception. In October 1962 the then Prime Minister Harold MacMillan told his Cabinet: “It was out of the question to allow Scotland or the North-east, or any large area, to be abandoned to decay.”

His Home Secretary at the time was even more direct: “If we do not regard it as a major Government responsibility to take this situation in hand and prevent Two Nations developing geographically, a poor North and a rich and overcrowded South, I am sure our successors will reproach us as we reproach the Victorians for complacency about slums and ugliness.”

England’s Future This is the last of week-long series examining the emergence of English political sentiment and what it means for the constitutional future of Wales and the UK. NEXT WEEK we begin a new series, on politics north of the border, as Scotland approaches its independence referendum in a little over a year’s time.

MacMillan saw him himself explicitly in the One Nation tradition of Benjamin Disraeli, who was described recently, somewhat implausibly, by Tristram Hunt as a “working-class champion”. MacMillan failed to halt the decline of the North of England that had arguably begun before the First World War. Perhaps if he were alive today he might argue at least he didn’t accelerate it.

Harold Wilson, the only Labour Prime Minister ever to have come from the North of England, presided over the fastest pit closure programme in history. Just under one mine a week was closed, cutting total UK coal production by a third in just six years and throwing 240,000 miners, mostly in Wales, Scotland and the North of England, out of work. Not even Thatcher could match that record of industrial devastation.

Track forward fifty years – over half of which were spent under a Labour government – and little has changed. Today we see a Conservative Prime Minister who on taking office, again referenced Disraeli by talking about uniting “two nations”. We see an Oxford-educated Labour leader from the south, with a northern seat, elected with the help of the Left – though he doesn’t to my knowledge smoke a pipe. Miliband has also adopted the One-Nation rhetoric. What was a half-useful Conference quip, here in Manchester, has now become the animating narrative, the new brand for ex-new Labour. Though their critics might point out that it’s difficult to see quite how policies like their regional benefit cap can fit into this.

The important point to grasp is this: the political language is identical to that of fifty years ago, because so, too, are the underlying conditions. There has been no progress. In fact, the divide is far worse than it was even then. And it continues to grow. Where you are born has as big an influence on your future life prospects, as whom you are born to.
In this inaptly named United Kingdom the spatial and the social are inter-twined. Geography has as much influence as class. For those who argue that the North-South divide is an over-simplification I would agree to this extent. The compass points of poverty in Britain are marked not just by north but by west too. The line of disadvantage lies between the South-East of England and the Rest, although there are of course pockets of acute hidden poverty in almost all communities in all parts of Britain. There is, nevertheless, a clear geographic divide.

In Wales, our economy has been drowned by wave after wave of de-industrialisation. We could say that this began with the aftermath of the First World War and continued through the Depression of the 1930s. Later came the Thatcherite onslaught and another period of further contraction post-97 under new Labour.

At each successive restructuring of the economy – Wilson’s second industrial revolution, Thatcher’s Big Bang, New Labour’s Knowledge Economy – we have seen income, wealth and jobs concentrated ever further in the hands of what the Centre for Research on Socio-Cultural Change here in Manchester – has called the “working rich”. After years of denial, the North-South Divide is once again on the political agenda.

It seems the role of a Deputy Prime Minister in every Government – Brooke, Heseltine, Prescott and now Clegg – is to speak in vivid terms about how much they are committed to ending the wealth gap between the rich south of England and an impoverished north.
Like the job of Deputy PM itself, such rhetoric has turned out to be little more than a PR job to appease the disgruntled. But as far as actual practical solutions are concerned, we have had eighty years of failed policies – from Harold Wilson’s Regional Development Commissions, which were abolished by Thatcher, to Blair’s Regional Development Agencies, which were abolished by Cameron.

And now we have welfare reform and austerity biting deepest in the North of England. The North-South divide has become a festering wound. And the only mechanism available to redistribute wealth is through the structural and convergence funds from the EU – albeit those funds are not enough to do the job, and they are now under threat from a Tory Party being nudged further rightwards by an ascendant UKIP.

If we really are to address the reasons for this century-old divide, I would argue we probably need a deeper, more fundamental shift in policy and in politics. Scotland has found its own solution to this north-south divide. Whatever the outcome of next year’s referendum there, the ties that bind it as a nation to the rest of the United Kingdom will inevitably loosen, whether that is through independence or through some form of devo-max.

And while an independence referendum is not currently on the agenda for Wales, in the short-term the prospect of more self-government for our country is very real. This is due, in part at least, to the approach taken by Plaid Cymru in setting the constitutional agenda in Wales. We have seen a number of significant advances in Welsh democracy, which will be fully evident by the end of this decade. Wales is on the move. If Scotland and Wales are on the move, what about England? There has been some discussion of an English Parliament in recent years, along with some moves for devolution to the English regions, but again, these debates haven’t yet featured in any meaningful way on the agenda. The clear risk for progressives in England is that UKIP will come forward and embody the ‘existential angst’ about England’s place in the world, as has been pointed out by the likes of Ken Loach.

I’ll come back to Ken a bit later, but first I’d like to share with you some thoughts as to how Plaid Cymru can make a contribution to debates about regional economic policy across the United Kingdom. We would like to see a proper regional policy within the union that would provide clear benefits for the regions and nations.
We are less vocal on how England’s governance should be arranged – with the exception of supporting Cornwall’s right to self-determination, we believe that what happens in England is a matter for people in England of course.

We would like to see an English Parliament emerge, with groups of local authorities forming a decentralised regional level of government beyond this. Whether this will happen will depend on English public opinion, and the extent to which the major parties in England react to the situation. What we can be sure of is that we in Plaid Cymru will engage positively and in a spirit of co-operation with whatever structures emerge.

The party of Wales has great sympathy with the Billy Bragg version of English patriotism. Billy has said that he doesn’t think a specifically English national party is needed, but that an existing party or a brand new party could place progressive Englishness at the heart of its appeal. We will have to wait and see what happens, but my message today is that progressives should not allow the territory of England and feelings of ‘Englishness’ to be the preserve of the far right.

There are big challenges. In Wales, we have learned that we had to claim Welshness for ourselves. We had to turn it into a civic project, not an ethnic or racial one. Our Welshness includes all who live in Wales. This civic identity is important. And our national project has enabled us to create solidarity between different parts of the country, and also to welcome new citizens to Wales.

An independent Wales does not command mass support chiefly because as a nation we have been impoverished to the point of bankruptcy. Not through our own ineptitude, but because of the indifference and negligence of those ruling on our behalf. Our economic position has required us to become radical decentralisers of power and wealth in the here-and-now. It strikes me that those of you here in England outside London and the South East could do something similar.
Isn’t it in all of our interests to work together to redistribute wealth?

To get anywhere we will have to be radicals and realists combined. In Wales, we are caught in a Catch-22 of self-confidence. Our lack of power over own future has rendered us poor and getting poorer. That very same poverty has gnawed away at the belief in our capacity to take power for ourselves. That said, since the political paralysis that engulfed Wales in the wake of the 1979 referendum, we have won two devolution referenda. And when asked if decisions affecting Wales should be made in Wales, a growing majority now say Yes.

Despite this being some sign of a growth in confidence, we still await significant growth in support for an independent Wales. That situation could well change as the context develops in Scotland. But we must also be prepared to work in the here and now, where Wales is today. 
This is time for us to build our confidence as a nation. And while we build that confidence and self-belief we must make sure that we do not allow a generation of Welsh youth to languish while progress waits. The economics of renewal goes hand in hand with the politics of liberation. We must show that we can reverse our economic disadvantage – that our people can be better off. That our poverty is not inevitable and it’s our job in Plaid Cymru to demonstrate that.

So the task that I have set my party is the radical rebuilding of the Welsh economy from the bottom-up. We have greater chance of achieving that if there is a reinvented British State and a rebalanced British economy. The current iniquitous set up makes that job very hard. Of course, what we want will be too difficult to achieve by acting alone. As we are just 5 per cent of the population of Britain, we need to work with others who share our interests; we need new alliances.

Those of us who are marginalised need to work together in order to seize power at the centre.

The de-concentration of wealth first requires the de-concentration of power. In Plaid Cymru, we often refer to the London Parties. This piece of political shorthand is, of course, by no means a political attack on Londoners. Many of them are victims of the same centripetal politics as we are in Wales. Reference to the London parties is an attack on a political system that has enshrined the City of London and spiralling, make-believe property prices at the core of economic policy.

For over a century the City of London has given priority to international trade over local lending and investment. This has been reflected in the mindset of our politicians, and in their policies in investment flows and the allocation of resources. Even where the City of London has supported infrastructure investment it has focused on the needs of London and the South East of England. Transport spending, for example, in the South East of England is double what it is in the North. Another example is that 60 per cent of all of Britain’s tower cranes are located in Greater London, which shows where the bulk of capital investment is taking place.

This exacerbates an over-heating southern property market, compounding the growing wealth gap. The City of London is, in the words of the Centre for Research on Socio-Cultural Change, “the Great Unleveller”. Instead of leading to the percolation of jobs, wealth and opportunity through mythic trickle-down, it has vastly increased inequality, socially and spatially, vertically and horizontally.

So what might be the elements of an alternative trajectory? How can we begin a spirit re-levelling of this island? There has to be a radical, muscular redistribution of economic activity – it can’t just be parts of the BBC that are moved north. This means the redistribution of credit through a network of regional investment banks, but also the redistribution of enterprise and activity through a system of economic incentives akin to the classical regional policies of old.

And as for us, in Wales, this principle needs to apply within our country too. We cannot afford to replicate the British system where the capital region overheats to the detriment of the rest – already people in Wales outside of Cardiff and the south east feel that their needs are being ignored. We must take active measures; we must have a clear plan to make sure we don’t make the same mistake. We have our devolved government, but regional decentralisation within that is vital if we are to make sure no one is left behind.

In England, decentralisation would most certainly mean powerful Regional Government for the North of England. So far, the political signs are encouraging on this front. The Smith Institute has called for a Council of the North Foundation; IPPR north has been consistent in its support for northern devolution; and more recently the Hannah Mitchell Foundation and its president Linda Riordan MP have been making an eloquent case for a new northern democracy. As a principled advocate of self-determination, it’s not for me to tell you where to draw lines upon your map. But I would make this comment: decentralisation should always mean that power cascades to the lowest level possible.

It’s no accident, I feel, that the biggest impact of the Localism Act 2011 was to reinforce London’s pre-eminence by giving the office of the Mayor of London even greater powers over housing and the economy. A greater Manchester and a greater Liverpool as ideas have great merit, but they can never compete on their own with the political might of Greater London.

Localism – whether city-deals or Local Economic Partnerships – can lighten the burden, but only devolution can get to grips with England’s North-South divide. One lesson to learn from the Welsh experience:  don’t allow the experience of one lost referendum consign an idea to history’s dustbin. These days we are all recyclers anyway.

In 1979 people in Wales voted 79.4 per cent against a Welsh Assembly, higher than the rate of rejection by the people of the North East of England in 2004. Eighteen years later we voted in favour. That should mean that a referendum for decentralised government in the north of England is winnable in a few years time. As I’ve said – of course, this is fundamentally a matter for you, people living here in England.
But, if, like us, you are interested in the balancing of Britain now, this would be a good way to go and would be and a step towards what a previous Leader of Plaid Cymru used to call a Britannic confederation. It’s what we might call today a new Commonwealth of Britain.

My party – The Party of Wales – would love to work with an Alliance of progressive forces from all parts of England, as well as those in Cornwall with whom we already have a loose alliance. In 2010, it was Plaid Cymru (and the SNP) who led the calls for a rainbow alliance of progressives, which would have stopped the coalition between the Tories and the Lib Dems. We would be prepared to do that again if need be.

I can understand the temptation but given all we know, does it make sense to put blind faith in a Labour Government governing alone? If we look at the cold evidence, we will see that Labour out of office will always obsess about winning back the South East of England; and when in office it has never addressed the core issue. They never rejected the pre-eminence of the City of London as the only worthwhile bedrock of the UK economy. They never really tackled the concentration of wealth.
The consequences of this, despite all the good intentions of, for example, the Regional Development Policy Commission, was that we in Wales and you in the North were left further behind economically after Labour left office than before.

The only difference is that Labour voters in Wales have somewhere else to go when they want to vent their frustration. 
This time, neither regional development nor devolution feature among Labour’s Policy Commissions, which does not bode well. Given this, there is little wonder the people in the north of England feel disenfranchised – 83 per cent of northern voters believe “politicians don’t understand the real world at all.” Of the ten English seats with the lowest turnout, nine are in the north, and the two lowest turnouts of all were in the central constituencies of Manchester and Leeds.
In the North of England, where Labour lies largely unchallenged, especially since the Lib Dems’ tilt to the right, there is double democratic deficit. A lack of a territorial voice on the one hand and the lack of a natural political home for those genuinely committed to challenging the status quo.

England outside the overheating centre needs a voice, and the Left needs a party. In Wales, our alternative voice regularly gets comments on facebook and twitter saying “I wish Plaid stood in England”. Well, I have an announcement to make – but it’s not quite that.

Plaid Cymru genuinely wants to support those of you in England who want to rebalance political and economic power. The party of Wales is not sectarian by nature. We are not consumed by antipathy to Labour, nor indeed to England. Our party is co-operative, internationalist and of the left. I have and have had close friends in the Labour Party over the years.
I have worked at grassroots level on projects of mutual interest with Labour members and as a party we were in coalition with Labour in the Assembly in the last term.  In Westminster, Plaid Cymru supported the Lib-Lab pact, and voted against the No Confidence motion that ushered in the Thatcher era.

We will work with progressives of any hue in England who want to decentralise, inside and outside Labour. We are also prepared to actively support a new Left party in England. I referred earlier to Ken Loach. Ken’s recent initiative has struck a chord – and perhaps that party could become the nucleus of a broader alliance.

Plaid Cymru has been here before. In 1992, we had an electoral alliance with the Green Party – which included a member of the Communist Party as our candidate in Gwent. This led to the election of the first Green representative in Parliament, in Cynog Dafis in Ceredigion. Pluralism can be the path to progress and there are successful examples to draw on: Syriza in Greece, Le Front de le Gauche in France, the Bildu coalition in the Basque Country, who I recently spent some time with – are all networks not single organisations.

A broad network in England, united behind a core set of progressive values could well include the Greens and other environmentalists.  It could include the trade union movement, many in the churches and other faith organisations, the new People’s Assembly movement, our sister party Mebyon Kernow in Cornwall, refugees from Labour and the Lib Dems and, yes, refugees from Respect and the SWP, too.

The potential for an English left-leaning alliance is enormous – and absolutely critical, for without it, the political void in England will be filled only by the knee-jerk reactionaries of UKIP and their ilk. An alliance of that nature is one that we could support. Utopian it maybe. But today we need our Utopias.

Politics as usual has not delivered. ‘Non-ideology’ or ‘technocratic politics’ will not get us out of the mess we are in.

Think tanks like the IPPR have been vital in helping place territorial justice in these islands on the agenda. But to properly achieve it, perhaps we need to go one step further and start thinking the unthinkable. 
The art of the possible, of the purely transactional, has failed Wales, it has failed in Scotland, and it has failed most parts of England too. There is no doubt that it has failed the Left. We need something different now.

As the old saying goes, if we carry on doing what we have always done, we will only get what we always got.

I have aimed, in this talk, to put the case for turning power and wealth the right side up. To do that we need a rainbow alliance for a radical, rebalanced, reindustrialised future: not one nation but a network of equals. Not the old Britain, but a new island where each of us owns the key to our own futures, in our own community, in our own land – that is maybe the change we all seek. I relish the prospect of working with you and in the years to come to achieve it.