A significant internal debate has emerged within the Labour party regarding devolution plans, with a former senior minister publicly criticizing proposals to shift political and economic power away from London. Steve Reed, who held several Cabinet posts under Sir Keir Starmer, warned that attempts to make other regions of the UK richer by diminishing the capital's influence would not succeed and could undermine party support.
Andy Burnham, the current mayor of Greater Manchester, is preparing to present a 10-year plan for Britain later this year. This plan is expected to advocate for greater powers for metro mayors, including authority over tax and planning reform, drawing on his experience in Greater Manchester. Burnham has previously voiced criticism of the deindustrialization and privatization of the 1980s, as well as the economic impacts of austerity and Brexit on regions outside of London and the South East.
However, Reed, the Member of Parliament for Streatham and Croydon North in south London, expressed concern that the 'Manchesterism' model could lead voters to believe that other regions' benefits would come at the expense of their own. He argued that as power shifts, Parliament is where losses would be felt. "When power moves somewhere new, somewhere else has to lose it and that place is Parliament," Reed stated.
Reed highlighted Labour's significant representation in London and the wider south of England, suggesting that alienating voters in these areas could be detrimental to the party. "We can't afford for voters in those areas to believe Labour wants to disadvantage London and the south in order to benefit other parts of the country," he said.
He also pointed out that the south is not uniformly affluent, noting that a third of London's children live in poverty. Despite higher average wages in London, high housing costs result in lower disposable incomes for Londoners compared to many other regions. MPs representing London constituencies have reportedly shared concerns that the capital might be overlooked or misunderstood as decision-making on devolution becomes increasingly concentrated among ministers from northern regions.
"But London's economy drives the national economy, it's bigger than the next eight biggest cities combined. You can't make the rest of the country richer by making London poorer," Reed asserted. He stressed that London's economic strength is vital for the entire UK.
In contrast, Burnham, in his capacity as Prime Minister, has emphasized the need for a frank assessment of recent decades' economic shortcomings. He advocates for the redistribution of power to communities across the country as a means to stimulate economic growth. "Unless we are blunt about what went wrong, we won't turn things around. Far from taking back control, the combination of these policies took control out of the hands of communities up and down Britain," Burnham told the House of Commons.
Burnham's plan intends to centralize the government's efforts to foster economic growth through increased public control over essential services and utilities, aiming to make them more beneficial for local people and places. He believes his approach, tested as mayor of Greater Manchester, offers a viable model for nationwide growth.