(Photo by Christopher Furlong/Getty Images)
The economic and political weather lying across Britain is stormy. The Chancellor will soon present a Budget where the size of the deficit is dictated not by ministerial ambition, but by the compounding of years of inherited productivity stagnation. Unless we turn this around, growth will falter, public services will be hit by the fiscal backlash and Nigel Farage will almost certainly occupy Downing Street.
Whitehall is slowly waking up, with the Treasury drafting further ambitious supply-side reforms and a new ‘super-DWP’ tasked with reviving a shrinking workforce and skills base. But if ministers are serious about breaking the cycle of decline, they should do something Westminster too rarely does: look north.
Greater Manchester is the fastest-growing region in Britain. Productivity growth over the last decade has outstripped every other region including London. Recent analysis by former Treasury economist JP Spencer showed that that between 2019 and 2023 Manchester’s gross value added per hour worked grew 14 per cent, compared to a national average of less than 3 per cent. Some of this reflects the arithmetic of catch-up in an unequal economy, but the scale and speed owes more to leadership, clear choices, and the confidence to act with confidence when others hesitated.
Devolution is part of the story, but what matters is how it was used. Greater Manchester combined a sophisticated settlement with strong local leadership. Andy Burnham’s mayoralty, working alongside council leaders, built a culture that looks for ways to say yes to investment, rather than the risk-averse instinct in Whitehall to say no. That strong political leadership has encouraged investors and accelerated reforms.
The results are visible. A simplified transport system with capped fares has widened access to jobs. Regeneration and densification have breathed life back into the city centre, encouraging the agglomeration effects on which modern economies thrive. An ambitious local industrial strategy focused on technology and innovation has drawn high-value firms and jobs.
On the labour market, the GMCA made progress while national Tory governments were wasting time. Since 2019, control of the Adult Education Budget has been used to align skills training with real economic need in sectors like health, construction, digital, green retrofit. The Mayor’s hallmark has been integrating public services to support those locked out of the workforce. Greater Manchester’s Working Well programme is currently the top-performing DWP contract in the country for job outcomes. The employment rate has climbed from around 69 per cent in the early 2010s to nearly 75 per cent today. That is not just a statistic on a spreadsheet: it is thousands of lives reconnected to work and dignity.
He has also recently tabled ambitious proposals to tackle the precipitous national rise in NEETs – young people not in education training or employment – by putting technical education on a par with university and devolving more control of skills policy to the local level.
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This is where politics and economics meet. Whitehall must realise that devolution is not a favour to the regions, it is a national productivity strategy. The closer power sits to people, the quicker it can be wielded. The further away it is from some of our risk adverse national institutions, the more likely we are to attract investment into the UK. Fundamentally, local leaders can cut through and act decisively at a speed Westminster cannot match.
What should follow now is equally clear. The government must complete the job on devolution, giving places meaningful control not just over transport, skills and planning, but also exploring strategic fiscal powers so regions can shape their own future.
But beyond devolution, we should reform our national institutions, so they learn from what is working in the country beyond SW1. The new DWP under Pat McFadden should engage closely with the GMCA on replicating the successes of their approach on the workforce and exploring their proposals on skills. The outcomes show the path to real reform runs not through the punitive rhetoric, arbitrary crackdowns or performative cruelty which failed so completely under the Tories, but through properly integrated services that help people find dignity in good work.
Ask people in Bolton, Bury, or Wigan what they want economically, and they won’t talk to you about the OBR’s productivity charts. They will say shorter commutes, cheaper energy, skills that lead to decent wages, and homes their children can afford. It is by fixing our economic fundamentals though that these tangible improvements are delivered. In Greater Manchester there is now a fragile but real sense that politics can still deliver these basic things. The success or failure of the government’s drive for national renewal will rest in spreading that feeling across the country.
Cracking this puzzle is not only about more output per hour, but about dignity in work, fairness in opportunity and greater security in people’s lives. Manchester is displaying a model and Westminster should sit up and take notice, otherwise the clouds above will only darken and a hard rain may yet fall.
Chris Curtis MP, Co-Chair of the Labour Growth Group
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