The All-Party Parliamentary Group (APPG) for the South East has published its report following its inquiry: Financing the future – what does levelling up mean for South East England?
South East Councils acts as the Secretariat for the South East APPG.
The report reveals major concern amongst local government and business groups in the South East that the levelling up agenda presents a major risk to the region in its current form.
The South East is one of only three regions in the UK who makes a net contributors to the Treasury meaning levelling up the South East is a vital part of levelling up the country as a whole.
Written and oral evidence received demonstrates that many parts of the South East are as much in need of levelling up as any other region, particularly coastal areas and airport towns, which were disproportionately impacted by Covid-19. The South East includes some of the most deprived areas in the UK including Hastings which is the 17th most deprived local authority district in England.
The inquiry heard that the levelling up agenda has not fairly considered inequalities within regions, pockets of deprivation, and the higher-than-average cost of living in the South East.
Concerns were also raised that the levelling up agenda could further centralise the system of local government in this country, rather than genuinely devolve powers closer to communities.
Meaningful fiscal devolution was proposed as a key solution to end the financial turbulence that makes it so difficult for local authorities to plan for the future.
The ability to set tourism taxes and greater flexibility to set council tax, business rates, property related taxes, and specific local levies were all mentioned.
The use of competitive funding pots was criticised for pitting councils against each other and forcing councils to over exhaust resources to skew their long-term projects to meet constantly changing objectives set at the Ministerial level.
The inquiry reaffirmed that there is little appetite for Metro Mayors in the South East as in Greater Manchester and the West Midlands whilst business groups stressed that business owners in the South East feel a lack of moral and political support, harming the region’s economic prospects.
Four recommendations are made in the report to ensure that levelling up benefits every part of the UK:
- Levelling up should not be about North versus South and must not come at the price of “levelling down” the South East.
- To be truly effective, levelling up must build on place-strengths with a renewed focus on skills and business driven economic clusters.
- Higher levels of devolved powers should not require further centralisation and directly elected mayors where it is not desired.
- Levelling up must address the ultimate issue of local government finance in the short and long term with an emphasis on certainty and flexibility.
Read the full inquiry report here.