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Good morning. Thanks so much for the fascinating and thought-provoking responses to Inside Politics yesterday — I consider one of them in today’s newsletter. If you have any thoughts and questions, send me a message at the below email address.
Our latest stories
‘Summer of discontent’ | Heathrow chief John Holland-Kaye said it could take up to 18 months for the aviation industry to return to pre-pandemic levels, while Britain’s largest rail union has announced the biggest strike action in 30 years. The RMT said rail companies and ministers would need to come up with new proposals if they wanted to prevent “months of disruption”.
NI high stakes | Boris Johnson has been warned that his plan to rip up post-Brexit trade rules for Northern Ireland will provoke a new row with Conservative MPs without necessarily restoring the region’s power-sharing executive.
Fixing the NHS | The government has promised “the biggest shake-up in health and social care leadership in a generation” as it published a review that criticised “institutional inadequacy” in the way the NHS trained, developed and valued managers.
Lost opportunity for Britain | The Financial Times’s editorial board writes that the prime minister’s refusal to accept the consequences of his mistakes is not just a misfortune for him but for UK voters.
Mandelson’s lessons | Sir Keir Starmer will struggle to win the next election unless Labour overhauls its economic policy, the former Labour business secretary Lord Mandelson is to warn today, reports the Times’s Patrick Maguire.
Shuffling towards Bethlehem
Yesterday I wrote that I thought Boris Johnson’s chances of leading the Conservatives into another election are pretty good. One minister thought I was missing a particular risk on the horizon:
You’re missing something big: the next reshuffle! Downing Street has been talking it up and the prospect of a job is why some colleagues backed him.
Government reshuffles are always risky because sacked ministers tend to be more mutinous than MPs who have never yet held ministerial office. In the Woman’s Own interview with Margaret Thatcher, the then-prime minister famously said “there is no such thing as society”. Thatcher also spoke of how she “agonised over [reshuffles] before, really agonised”:
They [sacked ministers] look at you and they say: “But I have done my job well!” and you say: “Yes, you have, but just as someone had to make way for you to come into that job, so we have got a lot of new young people and we have got quite a number who have been in the House for some time who have never had the chance to come into government. Some of them are very talented, and just as someone had to make way for you, I am asking you to make way for someone else!”
The Tony Blair government had a “sacked ministers group”, essentially a way to keep communicating with former ministers and to make sure they didn’t start rebelling and causing trouble. Johnson’s Downing Street has never had that kind of operation or sensitivity and it is difficult to build that kind of relationship after the fact.
The trouble with doing any sort of reshuffle is that it increases the number of people with nothing to lose on the backbenches. Because I am endlessly cynical, I am of the view that the prime minister will never actually embark on a big reshuffle, because that would be politically stupid and far too risky. It’s low-cost to promise a reshuffle and not deliver one, but actually doing another reshuffle may well leave Johnson in a worse position than he is now.
In their great write-up of where the prime minister is now, Seb Payne, George Parker and Jasmine Cameron-Chileshe reveal that Johnson has put key ministers “on notice” that they must step up and deliver the government’s agenda or face the axe later this year. Some Johnson supporters have said there are plans for an imminent “punishment reshuffle” for those showing insufficient loyalty. Again, I am relentlessly cynical so my underlying assumption is that when the prime minister talks of reshuffles he is writing cheques he has no intention of cashing.
The problem with my read of things, though, is that even if I’m right and there is no reshuffle, that makes it difficult for Johnson to win over rebels by pledging them jobs if his leadership faces another challenge next year. My bullishness about Johnson’s prospects of fighting the next election may well be misplaced.
You can’t keep a good megacity down
London’s economy is the fastest-growing in the UK and one of just two in the country to be above pre-pandemic levels. Here’s the key chart.
There’s a lot going on here. In many ways, the really striking thing on the chart isn’t London — it’s Northern Ireland. Thanks to the Northern Ireland protocol, it is the only part of the UK to still be in the EU’s regulatory orbit. And hey, who would have thought it? It’s the only part of the UK outside London with GDP above pre-pandemic levels. Output in the West Midlands, England’s industrial heartland, is still down 10.4 per cent compared with before Covid-19.
Northern Ireland’s relative economic success is because of its partial opt-out from Brexit. London outperforms the rest of the UK because of its sheer size.
One reason why it’s not helpful to talk about the government’s levelling up agenda in opposition to the capital is that the big myth of a lot of UK policy discourse is that there is a big button somewhere in Whitehall marked “good city policy” that ministers have chosen to press for London but they have obstinately refused to do for Manchester, Birmingham or Leeds.
But this isn’t the case: the UK state has mostly been really, really bad at city policy across the board, but London’s size has meant the capital has managed to grow and succeed anyway. The London Underground remains the product not of state planning but of private enterprise, and successive governments have built on that inheritance. In many ways, London is not a good model or a useful starting point to understanding the challenge facing England’s great cities.
London is growing now despite Brexit and the change to working patterns that facilitates the movement of some economic activity away from it. It performs well despite a prolonged stand-off between the central government and the city’s underpowered local government over transport funding, because of its size and the historical advantages that size has given it.
The much more instructive parallel if you want to level up the UK isn’t “what does London have that Leeds doesn’t?”, but “what does Lyon have that Leeds doesn’t?” The answer is a regional government that has the ability to raise revenue, to plan, build and finance its own transport. And, again, who’d have thought it? Lyon is more economically productive than Leeds.
There is no immediate prospect of the rest of the UK getting an opt-out from Brexit, which would end the long-term economic underperformance of the UK’s cities relative to cities of equivalent size (Tom Forth, co-founder of the Data City, has written a handy blog on that here). This means levelling up is going to have to take on greater urgency, just because the UK is going to need to get some of that growth back from somewhere.
Now try this
I am a gamer — admittedly, because I am a) controlling and b) find numbers soothing. A lot of my favourite video games are simulation games/glorified spreadsheets such as Football Manager, RollerCoaster Tycoon, Cities: Skylines and The Sims 4.
But I am dubious about the whole VR craze, which seems far too much like hard work to me.
Nevertheless, I couldn’t help but be intrigued by Tom Faber’s trip to Otherworld, a virtual reality experience you can do with friends. Ironic, as Tom notes, that to really enjoy VR you have to leave your home, but still, the first time I’ve really been able to see the appeal.
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