The UK's regional income divide remains stubbornly persistent, despite decades of promises and efforts from governments to bridge the gap. This is a stark finding from a recent report, which highlights the ongoing challenge for Andy Burnham, the prime minister-in-waiting, as he prepares to take on the task of addressing Britain's lopsided economic geography.
The Resolution Foundation's analysis reveals that, since 1997, there has been almost no progress in reducing the stark divisions in household income between the richest and poorest parts of the country. Despite the lofty ambitions of successive governments, including Boris Johnson's 'levelling-up' agenda, the income gap between the top and bottom tenth of local authorities has remained unchanged. This is a deeply concerning reality, especially given the significant investment required to address the issue.
One of the most striking findings is the persistence of high income inequality at the local level. The report shows that the income gap between the richest and poorest areas has remained consistent for almost three decades. For instance, the disposable income in Kensington and Chelsea, the richest area, is a staggering four and a half times higher than in Leicester, the poorest area. This entrenched divide highlights the difficulty in achieving a more balanced distribution of wealth across the country.
The report also highlights the lack of progress in certain regions. More than half of the local authorities in the poorest fifth of places for income per person in 1997 were still in that position in 2023. Similarly, 82% of the richest places had maintained their top positions. This indicates a persistent and deeply rooted issue that is resistant to change.
However, there is a glimmer of hope in the form of progress in some areas. The report notes that there have been improvements in tackling regional divisions, particularly in employment and economic productivity in cities like Manchester. The city's gross household disposable income per person has grown by 40% in real terms since 1997, showcasing the potential for economic revival. Yet, this progress is still not enough to bridge the significant income gap between Manchester and London, as well as other major northern English cities.
The Resolution Foundation emphasizes the need for sustained investment to address the regional income divide. In contrast to the UK's efforts, Germany has allocated a substantial amount of funding over an extended period to rebalance its economy. The foundation suggests that the UK's 'levelling-up' spending in 2022 was a mere fraction of what is required. This highlights the scale of the challenge and the need for a more comprehensive and long-term strategy.
In conclusion, the UK's regional income divide is a complex and persistent issue that requires urgent attention. Andy Burnham's commitment to addressing regional inequality is a step in the right direction, but it will take significant investment and a sustained effort to turn ambition into reality. The economic and political costs of Britain's geographic divides are high, and the time for action is now. The UK must learn from its past failures and invest in a more balanced and equitable future.
