Blog: Talk of the Towns: the uneven impact of Brexit

Policy Scotland’s Duncan Maclennan reflects on Brexit and British towns, in the light of the publication of the report New Powers, New Deals – Remaking British Towns After Brexit, a Policy Scotland report for the Carnegie Trust. You can download the full report here.

The deep rift of the Brexit vote earthquake and its endless aftershocks have triggered not just a long, wrangling exit-process but also shaken and unbalanced understandings of a great deal of economic and social life in the UK. Regardless of how the Brexit process ends, the UK will never be the same again. The Brexit shock has broken open Theresa’s Box and unleashed a whirlwind of re-examination of identities, beliefs and understandings that have shaped individual and government actions for decades past.

Thinking, and talking, about towns in the UK has intensified sharply over the last two years. The diverse set of towns, large and small, old and new, metropolitan edge or rural centre, are home to around one in three in the UK. They have long been neglected in research and national, and arguably more local, policymaking. There are no effective modern economic classifications of different towns in the UK, regional policies have paid them scant attention. Few regional or metropolitan strategies are based on a firm understanding of how the towns within a region are connected to each other, to major centres, the rest of the UK, the EU or the wider world. Economically, we don’t know where our towns are. But there is an urgent recognition that must change.

In broad terms, and with exceptions, Britain’s cities voted to remain in the EU. Many towns did too but there were two broad town types with strikingly strong exit vote that critically affected the referendum outcome. In the north of England and Wales, but not in Scotland and N. Ireland (where discontent had already found other routes by which to ‘exit’ conventional British political choices) there were significant majorities for Brexit in towns that had lost their economic bases in , at the latest, the mid 1980’s. Post 2010 ‘austerity’ with eroding core services, increasingly impoverished local governments and disproportionate numbers of the very poor damaged by welfare cuts and system changes were particularly evident in Northern England. Lying within the Northern Powerhouse, there are is a large and obvious ‘Northern Outhouse’ of neglected, economically stagnant towns.

At the same time, the growing towns around the faster growing metropolitan areas, especially in the South, saw rising incomes but also rising populations and immigration. The UK government, aware of well-researched evidence that immigration had facilitated a higher UK growth rate, took the tax revenues from these localities and by failing to return investment in housing, transport, schools and health services to them, fashioned shortages that would inevitably sour relations between existing residents and newcomers. The UK had failed to learn from countries such as Canada and Australia about how growth enhancing immigration can also foster more diverse but comfortable communities.

European Union policies had little to do with the spatial mismanagement of problematic decline and growth in the UK. Indeed, in the Welsh Valleys and the old North-east, is was often EU funded regional and structural funds that were the only visible signs of policy investment in poor and pressured places. The places, whether fashioned by growth or decline, that voted for something different, for Brexit, were largely a consequence of UK government-led austerity policies and the sustained inability of UK governments to thinks effectively about the connectedness and capabilities of people, places, and especially smaller towns.

It is a savage irony that there is a growing volume of evidence that suggests that it is the poorer regions of the UK, where significant town majorities for leaving the EU prevailed, that will now suffer most, and suffer more and longer the harder Brexit becomes. If the post-Brexit economy is to grow at rates envisaged by Brexiteers then that growth will primarily be in the places where it has been for the last fifty years, and not in the struggling towns. And it will require, as already old Britain ages more, immigration of young workers. Brexit will not solve the longstanding decline issues of poorer regions and it will not halt, unless we give up on economic growth, more new workers from overseas coming to pressured southern and metropolitan localities.

Brexit will solve neither the problems of concentrated spatial growth nor decline within the UK. It is likely, however, to significantly reduce the fiscal capacities to deal with these issues. In the newly released Policy Scotland report for Carnegie on Brexit and British towns it is argued that towns do have to take back control, but from Westminster (and Edinburgh, Cardiff and Belfast too) rather than Brussels. Britain is distinctive amongst European countries not in being an EU member but in being a highly centralised state in relation to public spending and tax autonomies. A range of changes that, regardless of what the Brexit outcome becomes, need to be put in place to rebuild Britain from the bottom-up as well as the top-downwards.