Downturn is no time to turn down vital investment in the north

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The main findings of the new report by Liverpool John Moores University’s European Institute for Urban Affairs are no surprise

The economy, public finances and regeneration have gone through a bad time, and things may get worse. The north of England has suffered more than the rest of the country.

But although things have been hard, they have not been as bad as some had feared they would be a year ago. The sense of crisis in mid-2009 has eased, and there are signs that developers are beginning to dip their toes in the water again.

Many places had experienced such a good period in the 10 years leading up to 2007 that they were starting from a higher base line, and they have not slipped back. And many feel that the position, and certainly the mood, has not been as bad as in the 1980s, when the north was going through massive industrial and economic restructuring.

This is not a new, southern-based recession that has hit financial services worst. The places that have been worst hit are those with traditional manufacturing industries and semi-skilled and unskilled employees. This is an old-fashioned, northern recession.

Most important, just as some think they can see the end of the recession in private sector regeneration, they are also seeing the beginnings of a public sector recession. There are real worries, especially in the private sector, that cuts in public spending will choke off any returning confidence and condemn the region to a much longer period of lower growth.

Many people are doing good things to cope with the impact of the recession, but often their levers are limited and their resources are declining. Decision-makers in the public and private sectors must recognise:

the achievements made during the past decade
the potential for economic growth and regeneration
the risks of a policy that cuts the capacity for early commitment, expenditure and intervention, either on the grounds that the job of regeneration and economic recovery has been done or that it is now too expensive be done.

The north needs the government to commit to regeneration, and to provide the region with a fair share of public spending. In return, the north must offer a plan for economic recovery that will use limited resources to grow its high burgeoning, value-added economy.

This is a plea for continued sustainable investment, not a begging bowl for a black hole.