Planning our way to a more inclusive form of economic prosperity

By Mike Emmerich

This is a slightly extended version of the Article I wrote for the Municipal Journal this month.

I was asked to write a counterpoint to a piece by Ray Lee, the Strategic Director at Elmbridge Borough Council in Surrey. His argument – his cri de coeur really – was that try as he and his Council might to build more housing, they were running out of options that people locally would be prepared to accept. I was asked to write a piece on how it looks from the North. The more I thought, the less it seemed right to see this as a North vs South issue because the status quo doesn’t really suit anyone. It is a national issue. This is what I wrote. This is being posted on the Metro Dynamics website as well as on LinkedIn and elsewhere. All comments would be very welcome either via social media or directly to me at

Owe the bank £1 and it’s your problem. Owe them £1m and the problem is the bank’s, or so the saying goes. The story of Elmbridge is one of many similar, whose end result is that local government ‘owes’ the nation millions of homes. Argue though the Government might, this isn’t fundamentally a Council problem – they have every incentive to grow their areas and most are doing so – but  many are running out of options.

Do we have an alternative? In the short term, probably not. But our model is under strain. We need to house our growing population in the places where it needs to be to access the jobs upon which our economy depends. But this model is under strain. Longer commutes, long a fact of life, look more and more as if they take a health toll on those who do them. Theoretically fixable with faster trains, practically, the experience of commuters is otherwise. For those who can afford not to commute long distance, in places like Elmbridge, they, but not necessarily their children, are the lucky ones. But if the Elmbridges of this world are bumping up against the limits of the possible, what do we do then?

Greenbelt release can be a valid strategy but it neglects the fact that most parts of the country aren’t like Walton in Elmbridge with five commuter trains an hour to the heart of our national economy. Many large towns and areas of big cities lack a vibrant economic engine. For others that have one it lies out of reach for want of effective transport. That is why people leave and housing demand is low.

Most of these places are now recovering from crises brought about by the decline of legacy industries. But they don’t have the economic engines to keep hold of the talented people who grow up in them. Because their economies are subscale, their transport systems can’t generate the BCRs of many Southern schemes. But how should we assess the whole life costs and benefits of transport investments such as the West Coast Main Line which is only now reaching capacity some 200 years after it was built? Certainly not the way we do now.

Successive Governments have rightly trumpeted education as a route to improvement. But, as Martin Wolf pointed out in the FT recently, the hard truth is that the chief determinant of social mobility is class structure. Education can influence this but can’t change it. So education and economic development need to proceed in union.

If housing, transport and education all pile pressure for success in some prosperous and well-connected areas and leave others, even in and close to successful cities, behind, we really are facing a national policy failure. There is an emerging agreement across traditional political divides that this is where we are as a nation. We need to evolve our economic model and the way it grows to be both more successful (we still have woeful productivity) and more inclusive.

Looked at in this way, it isn’t a north/south issue, or a cities versus towns issue, just as it isn’t a left-right issue. Major cities and towns outside London need better internal and external connectivity to support their recent growth and help people to get between and around them. Anchor institutions: councils, universities and businesses need to be true to their civic roots and embrace the opportunities to develop strong local ecosystems of production and consumption. Stronger and deeper investment markets are needed to help provide the risk capital business needs. Universities and technical training both need to be strong. And precarity at work, even with rising minimum wages, undermines the ability of too many towns and cities to offer their residents a decent future.

These are issues that are increasingly dividing towns and cities and pitching North against South too. In the long run, the challenges of places like Walton-upon-Thames, however seemingly removed, lie in Wisbech and Wigan and vice versa. Unless they become stronger, and the cities around them, Peterborough and Manchester in those cases, become stronger too, there will be no respite. It wasn’t markets alone that created our problems. It was poor national government too. It will take a delicate balance of a better version of both to solve them.

We need stronger and more inclusive economies. That means strong businesses and markets. But we need a more muscular and better networked state too which takes insights from what we know works and makes calculated investments in new ways of working.

The state can and should fill the gaps left by failing markets. We must ensure that education is excellent. But the lifeblood of our nation has drained into relatively few areas. Industrial, skills and transport policies all have a role in changing that: making every part of the nation feel as if it is an essential part of our economy and that every person can fulfil their potential. 

That is what Britons have demanded in recent elections. We need to plan our way to delivering it. Devolution needs to be unblocked; transport investment needs to be accelerated. But the starting point for all of this is a recognition on the part of the those with the power to act that change is needed. Whitehall and Westminster need to listen and deliver.