On the eve of the referendum, Britain was running a record current account deficit, growth was being pumped up by an overheating housing market, factories were still producing less than before the start of the financial crisis, and people in the poorest parts of the country were being targeted with depp cuts to welfare benefits. There was a growing north-south divide: there is a 44% gap between the south-east and the less productive cities in the rest of the country.
Old industrial Britain is still suffering the consequences of the closure of factories and pits three or four decades ago. These communities have higher levels of unemployment and of people on disability benefit. Brexit was about dead-end jobs and run-down communities talked down and bossed around by London.
If a second referendum was held and reversed the decision, the leavers would feel betrayed - and might opt for more violent protest than the ballot box - unless changes were made.
The leave camp faces the same challenge - only empty promises so far by the politicians.
The writer of this piece proposes the following:
- The north is not short of homes, but its housing stock is often run down and energy inefficient, so there should be a nation-wide programme to improve insulation, starting with cities in the north. This would cut fuel bills, reduce carbon emissions and provide well-paid jobs for local people.
- Start a new national investment bank, to channel funds into traditional manufacturing sectors, such as engineering, and food and drink, where they need modernizing, and to identify the growth sectors of the future.
- Britain should focus on excelling in developments in artificial intelligence, nanotechnology, biotechnology, materials science, 3D printing and quantum computing, which will transform the global economy.
- However there is a danger that the benefits will go overwhelmingly to London, Oxford and Cambridge, a university in each of the big northern cities needs to be identified to take the lead in specific areas, and academic funding, tax breaks, state aid and public procurement should be used to establish industrial clusters and develop domestic supply chains.
- Substantial improvement in northern infrastructure is needed. Money earmarked for the HS2 rail link should be spent instead on HS3 - linking Liverpool, Manchester, Leeds, Sheffield and Hull. As currently planned, HS2 would suck talented people out of the north, while HS3 would encourage them to stay.
- Address the skills gap in the north - companies are currently unsure they can get the people they want. Levels of adult literacy and numeracy are poor. There is a mismatch in further education between the courses on offer and the skills employers need.
- Allow local governments to raise and keep more of their own money. Ensure a new investment bank is based on the banks of the Mersey or the Humber.
- be bold and move parliament to Leeds or Manchester.
