We recently had the privilege of hosting our inaugural lecture on ‘What next for devolution and growth?', in partnership with the Policy Institute, at King's College London and the Strand Group. An expert panel brought diverse perspectives from different sectors, including insights from those working within the Mayoral Council to tackle the country's economic challenges, as well as those engaged in delivering growth at the UK's only inland freeport. The discussion also drew on recent research examining how greater funding and governance reforms could address the UK's economic imbalances.
At the heart of the discussion was a thought-provoking keynote address from Dr Nik Johnson, mayor of Cambridgeshire and Peterborough Combined Authority. Dr Johnson challenged the conventional reliance on GDP as the primary measure of economic success. He advocated for broader metrics – such as shared prosperity, quality of life, and the capacity to foster a skilled, high-wage economy – as more meaningful indicators of growth.
Meanwhile, Nora Senior, chair of the East Midlands Freeport, offered a critical assessment of how devolution can unlock growth outside London. She argued that for devolution to fulfil its promise, business-led ventures such as Freeports must receive strong, coordinated support from both government and strategic local authorities. Moreover, Whitehall must adopt a joined-up approach to regional development. Central agencies like National Highways must be aligned with regional goals to help galvanise economic growth and attract investment.
The question of how to tap into the full economic potential of regions outside London and the South East was a key theme in the ensuing debate. Former shadow chancellor Ed Balls, co-author of the recent report Bridging the UK's Regional Divide, highlighted several bold proposals aimed at stimulating regional growth. These included offering unitary local government in England multi-year financial settlements to allow greater strategic planning. The report also stressed the need for greater political consensus across the main parties to create a 20-year UK-wide growth strategy and ensure that the necessary funding and governance reforms to support it are enacted.
The challenge of bridging economic imbalances within the UK has come into sharper focus following the recent release of the UK Regional Economic Forecast 2025 by Ernst and Young. While steady economic growth is expected across the UK from 2025 to 2028, the Midlands, North of England, Scotland, and Wales are forecast to experience slower-than-average GVA growth. In contrast, London and the East of England are predicted to see 1.7% GVA growth over the next three years, with the South East, South West, and Northern Ireland expected to match the national average of 1.6%. Although all regions will see some economic growth, the report suggests that only London and the East of England will experience growth rates exceeding the UK average.
Despite the forecasted short-to-medium-term imbalances, the panel remained cautiously optimistic. They believed that if devolution continues to progress at pace and is accompanied by strong local leadership UK cities outside London could potentially achieve economic performance levels comparable to leading European cities. This would result in a multi-billion-pound annual growth dividend, helping to fulfil the economic promise of devolution.
Roger Russell is a Partner at Faerfield
● View the full lecture at https://shorturl.at/voTDZ
