Labour conference: new regional economic model will reach ‘left-behind’ communities

26 Sep 17

A new economic model for the regions would help the Labour Party make “a fundamentally better offer” to voters, according to local government and devolution spokesman Jim McMahon.

Speaking at a fringe event yesterday, McMahon, MP for Oldham West and Royton and a former leader of Oldham Council, argued that his party should look specifically at public procurement spending and local transport links, highlighting their potential to boost local economies.

He said too many people in his constituency felt “left behind” and that bold new regional policies were both “the right thing to do” and necessary to win voters back to the party.

Talking about spending on services by public bodies as one route to keep investment in the local economy, McMahon said: “We spend £242bn a year, a third of our public spend, on procurement. That’s an easy way the government can make a change happen today, to make sure that co-operatives and mutuals and social enterprise in particular manage to benefit from that government investment”.

All three of these models aim to make a positive local impact when they deliver services. 

McMahon also raised the “massive issue” of local transport, which in his constituency is “over-priced and not very reliable and doesn’t go to where people need the jobs that they deserve”.

He welcomed major transport initiatives connecting the big cities of the north, but pointed out that tens of thousands of new jobs in places like Oldham are on the outskirts of the town, where links remain extremely poor.

“What I want to see from an incoming Labour government is a determination not just to make it a bit better for people who are struggling to get by,” he said. “I don’t even want them to do slightly better in the future than they are today. I think we need a completely different model of the way that we govern”.

Without a “fundamentally better offer” to voters, he said “Labour are really going to struggle to form a government, because I don’t think people are going to come to us”.

Joining McMahon on the panel, councillor Angeliki Stogia, from Manchester City Council, agreed that simply creating more jobs “is not going to cut it”.

Her council’s ethical procurement policy, Stogia argued, means that over half of its annual £600m budget goes to 300 Manchester-based suppliers. “That translates into jobs and translates into suppliers,” she said, “as well as qualifications for our workforce.”

Torsten Bell, director of the Resolution Foundation think-tank, told the same event that one unexpected consequence of the financial crash had been “a renaissance of regional leadership”. This was essential to securing stronger growth, Bell argued.

But he also cautioned that people’s real incomes all over the country remain precarious: “We are almost certainly in the worst decade for earnings growth since about 1800. And then the problems were caused by Napoleon, not by the collapse of Northern Rock.”

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