Think tank urges bigger London to bridge North/South divide

A report from Policy Exchange has recommended replacing the Government's current urban regeneration strategy with one which would encourage major growth in and around Cambridge, London, and Oxford.

It suggests that ministers should be more realistic about the regeneration prospects in places like Bradford, Liverpool and Sunderland and encourage hundreds and thousands of their residents to move south.

The report also recommends that Government policy should be based on the fact that London, along with cities like Oxford and Cambridge, provide the best opportunities for economic prosperity.

Authors Tim Leunig and James Swaffield argued that the capital and surrounding areas in south east England have the capacity and potential to be economic powerhouses, creating new high-skilled, high-wage service sector hubs.

They also proposed that the Government’s three-million new homes target can be achieved by expanding Cambridge, London, and Oxford.

The report has suggested that the capital can be increased in size by allowing landowners the right to convert industrial land into residential land in areas of above average employment.

"If only half of the 10000 hectares earmarked as industrial land in London and the South East were used for housing, it would create £25bn in value and allow half a million people to move to an area that offers much better prospects than where they live now" stated the report.

The right of centre think-tank has been credited with influencing Conservative party policy making. Co-author Tim Leunig from the London School of Economics said: "No doubt some people will claim that these proposals are unworkable, unreasonable and perhaps plain barmy. But the issue is clear: current regeneration policies are failing the very people they are supposed to be helping and there is no evidence that the trend will be reversed without radical changes. Internal migration has always been an important part of a dynamic economy."

A spokesperson for the Department of Communities and Local Government said: "We totally disagree with the conclusions of this report.

"No Government has done more to turn around decades of neglect, and since 1997 cities like Manchester, Liverpool and Newcastle have benefited from thousands of new jobs, lower crime rates and better living standards thanks to our sustained commitment to regeneration, and investment in public services.

"It's alarming that this 'think tank' is labelling our great cities as 'beyond revival' and arguing that we should target less effort on them, when those areas that have received regeneration funding have shown the greatest improvements."

Read the Policy Exchange report 'Cities Unlimited'

Roger Milne

14 August 2008