The persistent regional income divide in the UK has been a long-standing issue, despite the promises of successive governments to bridge the gap. A recent report by the Resolution Foundation reveals that, over the past three decades, little progress has been made in addressing the stark disparities in household income across different regions. This is particularly concerning for Andy Burnham, the prime minister-in-waiting, as he aims to transform Britain and fix its broken system. The report highlights that the income gap between London and Northern Ireland has remained largely unchanged, with London's gross household disposable income per person at £27,900 and Northern Ireland's at £17,300 in 2023. This three-fifths difference is a stark reminder of the persistent regional inequality.
The study also underscores the persistence of high income inequality at the local level. The gap between the richest and poorest areas is staggering, with disposable incomes in Kensington and Chelsea at £60,584 and in Leicester at £13,398, a four-and-a-half times difference. Even more concerning is the fact that over half of the local authorities in the poorest fifth of places for income per person in 1997 are still in that position in 2023, while 82% of the richest places have maintained their top positions. This entrenched divide is a testament to the challenges of rebalancing Britain's economic geography.
The report's findings are particularly relevant for Andy Burnham, who has pledged to achieve 'good growth in every postcode' as part of his devolution agenda. However, the Resolution Foundation warns that he will need to address the significant investment required in transport, housing, and regeneration projects to overcome the three decades of failure to tackle regional divisions in household income. The foundation suggests that the UK's 'levelling-up' spending in 2022 was just £4bn, a fraction of the £70bn allocated by Germany for post-cold war reintegration. This disparity highlights the scale of the challenge Burnham faces.
Despite the grim statistics, there is some progress to be celebrated. The report notes that jobs growth has been concentrated in low-employment areas, and local pay gaps have narrowed due to a rising minimum wage. Manchester, in particular, has seen a 40% growth in gross household disposable income per person between 1997 and 2023, demonstrating that decline is not destiny. However, the city's income level remains significantly lower than London and other northern English cities, indicating that there is still much work to be done.
In conclusion, the regional income divide in the UK is a complex and persistent issue. While there have been some positive developments, the overall picture is one of stagnation and entrenched inequality. Andy Burnham's ambition to address this divide is commendable, but it will require substantial investment and a comprehensive strategy to turn his vision into reality. The UK must learn from Germany's commitment to rebalancing its economy and take serious action to bridge the geographic divides that continue to plague the nation.
