Northern Powerhouse to get a boost of £556 million

The government has sought to address growing issues with the disparity in spending between different areas of the country, with the North of England reportedly being one of the worst affected. The government has reportedly held its first regional Cabinet meeting since Theresa May’s ascent to the office of Prime Minister last summer, and has immediately discussed a lack of investment in Northern areas of the country.

Northern Powerhouse to get a boost of £556 million

The Prime Minister has recently been pushing a strong rhetoric for reinvigorating British industry by investing heavily in infrastructure projects and housing. The Prime Minister, who is under pressure due to her ‘hard Brexit’ approach to dealing with the fallout of the vote to leave the European Union, is due to launch a brand new industrial strategy for the UK and areas such as Manchester, Liverpool, Leeds and Newcastle are set to benefit from the scheme.

Manchester, home of the first Industrial Revolution, could be the biggest benefactor, but other cities such as Liverpool, Leeds and Sunderland are also set for a boost.

It is reported that the total figure for the Northern Powerhouse will be £556 million which will aid job creation, support businesses and encourage growth. It is a stark turnaround in the Prime Minister’s policy on the Northern Powerhouse given that in August of last year she was seen to be lukewarm about the idea, saying that she would be concentrating on investing all over the UK, rather than just in one area.

It is not particularly surprising that the government has turned its attention to the North once again as the region has continued to grow . Property prices, business growth, job growth and Gross Value Added (GVA) all increased impressively across the Powerhouse regions.

Property developers in particular have seen impressive success as the uncertainty of Brexit has encouraged foreign investors and domestic customers to place their bets on a reliable performer. Off-plan property across the Northern Powerhouse project has been booming, with developments springing up barely quickly enough to meet the demand of customers across Europe, the Middle East and China. Rental yields and capital growth have been the driving force behind the success, with areas like Manchester, Liverpool, Leeds and Newcastle especially having seen their stock rise among potential movers from the south of England.

The Greater Manchester region is reportedly going to be the biggest winner in May’s announcement, receiving £130.1m compared with the next largest beneficiary, the Liverpool city region, which will benefit from £72m in investment. Greater Manchester, which has a population of 2.6 million, will benefit from nearly twice as much funding as Leeds, which will get £67.5m for its population of 3 million people.

There have been some complaints from other city regions regarding how the funding has been spread across the Northern Powerhouse regions, but those keen to earn the most from the government’s investment can point to the comparative success of Manchester compared to its neighbours in terms of GVA and overall economic growth as reason enough for it receiving a larger payment.

May has also made it clear she is set to invest £10 million into a life sciences innovation fund for businesses in Manchester and Cheshire. Money will also be spent on a new conference centre set to be built in Blackpool which will enjoy good transport ties to both Manchester and Liverpool. Added to this there will be funding available for an International Advanced Manufacturing Park (IAMP) close to the Nissan factory in Washington, near Sunderland, which is projected to create over 5,000 jobs in the area.

The news was warmly received across the region and brings a welcomed focus from the government on helping to grow business and economic interests across the north. As the triggering of Article 50 approaches (reported to be in March), the government is under increasing pressure to deliver change in the Northern industrial heartlands which voted strongly to leave the European Union in June 2016. It is thought that these announcements are a gesture of good faith to the people of Northern England, and show that the even distribution of jobs, wealth and opportunities across the country is a top priority for the government.

Property and investment in the area is already performing strongly, but if the government also brings job growth, wage growth and increased living standards we could see an even bigger influx of bright young professionals into the North. In turn, this could have a significant upward effect on rental demand. Regardless, this spells good news for everybody across the Powerhouse regions, whether as a place to live, work or invest.

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