Kerslake asks for £250bn fund to tackle inequalities in the UK

31 May 19

Former chief civil servant Bob Kerslake has called for the creation of a £250bn fund to tackle deep-rooted regional inequalities.

He warned London is “decoupling” – becoming increasingly unequal – from the rest of the UK, in from report from UK2070, a commission on regional inequality of which Kerslake is the chair.

The country as a whole is failing to create equality and inclusive economy, the document added.

Former permanent secretary at the Department of Communities and Local Government Kerslake said: “Much of what has been done to date to tackle the inequalities across the UK has been in the form of underpowered ‘pea shooter’ and ‘sticking plaster’ policies – too little and too short-lived.”

UK2070’s analysis said that the UK’s richest region (London) has a 50% higher level of productivity than any other nation or region in the UK.

The report suggested that it is “hard to define precisely the level of funding needed” to correct this but it recommend at least £10bn per annum above existing spending plans for the next 25 years – a total of £250bn.

An outlay of 0.5% of annual GDP would be offset by higher regional growth and the funds would support investment in new infrastructure and lead to inward investment, the commission said.

A “huge gulf” exists between the UK’s least and most prosperous regions, it said, noting that a child who qualifies for free school meals in Hackney is still three times more likely to attend university than an equally poor child in Hartlepool.

Analysis by the commission found that one in four poor children live in the most deprived local authority areas where healthy life expectancy is 19 years less than the most affluent areas.

The commission estimated that the productivity gap in the English regions costs the economy around £40bn.

The NHS is affected too with inequalities running up a bill of £4.8bn per year, according to the interim report.

UK2070 called for a “much greater level of devolution at local level to local government”, which it said would empower existing and new accountable strategic bodies.

“If we are really to shift the dial on spatial inequalities, what we require for the future will need to be structural, generational, interlocking and at scale,” Kerslake concluded.

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