The big debate is about how ‘hard nosed’ the city should be to follow the Manchester model
Cities that want to follow Manchester must be tough and not build “cathedrals in the desert” – that’s the message from the latest debate on what other cities and regions can learn from “Manchesterism”.
Manchester’s success story has been the subject of controversy in recent months since Andy Burnham began his journey to No 10, and eventually to No 10 North.
This week the Manchester Business School Alliance and the Productivity Institute invite experts and academics to debate what Manchesterism means for economic growth and productivity. And there was a clear message from all the speakers – devolution is not the end, but a tool that must be put to good use to help transform the city from a “basket case” to an international example.
Professor Philip McCann, the Sir Terry Leahy chair in urban and regional economics at AMBS, called Manchester a classic “turnaround city”. He noted some cities that decades ago were seen as “seller’s cases” in his country, but since then. These include Dortmund and Duisburg in Germany, Lille in France, Bilbao in Spain, Pittsburgh in the US and Newcastle in New South Wales.
Devolution is a journey, rather than a process. “Are we done?” Prof McCann asked. “No. But it’s an important trip.”
He criticized Britain’s tendency to centralize Government in London, saying the devolution plan was a “colossal failure of governance”.
He thought: “Why does the central government regulate local bus routes? … it is useless. It is a trap that the UK does by default and by accident. And he added: “We are the only country in the industrial world that has become more decentralized in the last 40 years.” Manchester, said it is necessary to break that mold – and it has been done successfully.
Prof. McCann said another reason why devolution is important is that it allows investors to feel confident that their money is safe, and protected from “ministerial fiat”. Investors, he said, should understand that ministers cannot just unilaterally decide to cancel anything in the future – otherwise they will be “sitting on their hands” because the potential investment is too risky.
Prof McCann lists some key lessons people can learn from successful cities. This included the revitalization of Victorian and Edwardian buildings which were often derelict in the 1970s but have since been revived as some of the city’s most desirable residential and commercial properties.
Urban areas needed, he said, a comprehensive strategy rather than “small ad hoc approaches”. And he said that the strategy should be built on the existing strengths of the city, instead of suggesting a white elephant project “cathedral in the desert”. Manchester’s strengths, he says, include its airport and the technology and life sciences sectors.
Strong local leadership is also important, Prof McCann said, highlighting Manchester’s long record of stability with leaders including Sir Howard Bernstein. In addition, the city needs a stable and long-term flow of funds. Prof. McCann said: “You set, you lock in, investors are happy” because they know there is a long-term plan.
Professor Philip McCann, Sir Terry Leahy chair of urban and regional economics at the Alliance Manchester Business School, spoke at the debate on Manchesterism.(Image: Reach plc)
And finally, he said, leaders must work with businesses, residents and other groups in their area. “Nobody expects everything they want,” he said, “but people expect to be part of the story.”
Henri Murison, chief executive of the Northern Powerhouse Partnership, said devolution was not a magic bullet to increase productivity or boost the local economy. It is not power or funding that leads to success, he said, but “the way you use it”.
Manchester has been successful, he said, because of the willingness of its leaders to work with governments of all colors and make the tough decisions to succeed. “Just having a mayor and a local structure doesn’t mean people make better decisions,” he said.
Mr Murison said the cities and regions that had launched had to make a disciplined case for investment and had to make that case as strongly to central Government as it would to overseas investors. There has, he said, been a tendency in the past for some cities to use “grievance politics” to demand investment from the Government, rather than making a sound business case.
Manchester, he said, has long shown that it takes growth seriously and can take good decisions.
Investors won’t come to a city just because it’s ‘good’
Prof Nigel Driffield agreed that cities and regions should be able to make a clear, fact-based case to investors to explain why they should put their money there.
He said that just “Come here because it’s good” or because the city has a good football team won’t work – places need to make a “hard business case” to attract investment.
Prof. Driffield, professor of international business at Warwick Business School, said that it is necessary to include evidence of a skilled local workforce, or a strategy to develop.
“I’m old enough to remember the DeLorean,” he says, recalling the failed United States car factory in the 1970s in Northern Ireland.
Prof Driffield said he had spoken to business leaders about their experiences with the government that had been launched, and said some had been frustrated by the lack of action following the meeting. But he said businesses should not give up on devolution, and should support leaders to make it happen.
He said, “Your mayor is building an airplane when it flies” by making little devolution at the same time to create more power. So even if the mayor’s event feels “like a talking shop,” he insists, you should come back and participate.
He said with a smile that more areas such as innovation and skills are downgraded, you can “go out and shout at your mayor, so this can be fixed” instead of losing to ask the central government.
Prof. Melanie Jones, economic processor at Cardiff Business School, said attention has focused recently on Manchester for “political reasons” as much as hard evidence that the Manchester model can boost productivity. He added that Manchester’s “consistency and long-term vision” was something other devolved areas could learn from.
Then he said other regions should decide what their own strengths are to achieve their own goals, rather than mirroring Manchester’s model.
He said: “We’re not all Manchester, we’re not all going to have a great airport or university”, but other areas can be famous.
What about inequality?
In a Q&A session at the end, the panelists discussed the challenges of increasing inequality in cities like Manchester which are seeing more regeneration in their centers than in the outer areas.
Prof McCann notes that the most successful cities need to focus on the central core, and that inequality can increase as cities become richer. He said: “You want to lift all boats but it’s an uneven process in every city in every region of the world. The most successful places are more uneven, that’s the reality”.
Henri Murison went on to say that transport investment can also help cities and regions grow, by allowing people to travel from greater distances. He said: “You don’t need growth in every zip code. You need residents in every zip code to be able to get to where the growth is.”