Here are five predictions for what will shape Britain’s cities this year

For a start, we'll probably hear more from this guy: London's mayor Sadiq Khan. Image: Getty.

Last year was one which confounded predictions and wrong-footed experts in everything from politics to football. But I buy Nesta’s argument that accuracy isn’t everything when it comes to predictions. Thinking about possible futures informs our plans, even if they have to change in light of unexpected events.

With that in mind, here are my predictions about five big issues that will shape the rest of this year for city regions.

First, the rules of global politics and economics will change, with a move towards increased protectionism from some and growing concerns about immigration everywhere. 

Last year’s backlash against globalisation is set to continue with the arrival of President Trump, committed to reintroducing tariffs, revitalising America’s manufacturing industries and working on a bilateral rather than multilateral basis. The French and German elections, whatever their outcome, are set to have wide-ranging implications for the EU and its constitution and, of course, for Brexit negotiations.

All of these changes will affect trade not just internationally but also at the city region level, with different implications depending on the industrial and workforce make-up of each area.

The combination of Brexit with such significant changes in political leaders in the US and EU means that international politics will dominate the national policy agenda this year. It will colour almost every other policy debate and absorb a substantial proportion of ministerial and civil service time, to the exclusion of many other issues – potentially including devolution, which requires considerable policy untangling in such a centralised country.

However, amid international economic upheaval, it is even more important that the UK government does all it can to support city regions up and down the country to thrive. That means, paradoxically, there’s a chance (it may be a slim one but here’s hoping) that the government ends up engaging in more wholesale devolution to city regions to free itself to deal with these international challenges.

Second, as government seeks to support domestic growth, the tension between economics and politics will continue to grow, exemplified by the government’s forthcoming industrial strategy’s recommendations. 

Government needs to support economic growth and boost productivity as quickly as possible in order to raise wages and improve living standards. Economic evidence suggests the way to deliver results quickly is to concentrate investment and resources on the areas that are already successful. This will deliver the fastest, and generate higher levels, of growth and taxes for the UK as a whole.

Yet we already know that the way the UK has supported economic growth in the past has not delivered enough benefit for enough people. This is further bolstered by the fact that many who voted for Brexit and Trump did so in part because they felt their living standards had not improved in recent years. Politicians need to deliver an economy that “works for all” - one that has high productivity and helps the people and places that have been left behind.

But there is no easy way to do this; the risk is that, as economic and political pressure grows, the government ends up investing in policies that history shows neither help growth nor help the more disadvantaged areas – for example, building innovation campuses in deprived communities that lack the skills, business demand or infrastructure to support them to grow rapidly, or for locals to benefit from any jobs created.

The industrial strategy will need to grapple with this. Greg Clark’s commitment to a place-based approach is encouraging but expectations are high, probably too high. To be regarded as successful, the industrial strategy will need to set the tone and pave the way for the UK’s sustainable future growth, make the most of limited funds to invest in innovation and support economic growth, and respond to demands that something happens now for those who are left-behind.

The industrial strategy will shape domestic economic policy for the foreseeable future, and city regions will need to be at the heart of its development and implementation.


My third prediction is that distrust in politicians and the "elite" will continue to grow, with metro mayors and local politics offering new opportunities for national parties to connect with the electorate.

National politicians face stupendous difficulties in delivering on the high expectations of a divided electorate. Take Brexit – the Conservatives need to agree a deal that delivers on all the campaign promises, while holding together its small majority. Labour needs to work out what deal will work best for the 70 per cent of its constituencies who voted Leave and who UKIP is looking to poach, while at the same time as not antagonising its Remain supporters, who the Liberal Democrats are courting. This task will be made more difficult by the lack of trust among the electorate of national politicians and the elite in particular.

Local politics, and the incoming metro mayors in particular, offers new opportunities for national parties to reconnect with a sceptical, divided electorate. The election of city region mayors in May creates a new opportunity for all of the national parties to reinvent themselves and reconnect with the electorate – one recognised by big names like Andy Burnham and Andy Street.

For Labour, there’s an opportunity for mayors to show that Labour can deliver demonstrable change grounded in local priorities rather than political ideology. For the Conservatives, there’s a chance to demonstrate their relevance and value to urban voters, such as in the West Midlands, that have otherwise largely ignored them.

This is not to suggest it will be easy for mayors to build trust. It is a new role and will take time to make a difference. One of the big challenges the new metro mayors will face – as our work on lessons for metro mayors highlights – is setting the tone for the future of the role, as well as for their term. Communicating their aspirations early on, and ensuring they make a start on delivery, will be vital, even if substantial change takes time.

Fourth, 2017 will be a year in which UK city regions and metro mayors rethink their national and international roles.

Across the world, there is a global shift towards mayors being regarded as the pragmatic responses to ideological impasses at national level – the people who not only ensure that services run and potholes are filled, but also those who can take tangible action to tackle big issues like climate change. Global networks such as Benjamin Barber’s Global Parliament of Mayors and C40’s Climate Change Leadership Group will become increasingly important to city leaders keen to make the most of international links and learn from each other about tackling global problems.

Cities will also be looking to pioneer new ways of doing things, with big data and "smart cities" likely to become of increasing interest as cities consider how best to support economic growth and respond better to the needs of their residents and visitors.

Finally, throughout 2017 the nature of work will continue to change, which will impact people and places in different ways. 

Since the recession, the UK has seen strong jobs growth, tepid GDP growth and zero productivity growth. Policy needs to sustain the first and tackle the second and third issues. As the UK continues to specialise in knowledge intensive jobs and industries, skills are becoming more important to individuals’ opportunities and are likely to become a growing policy priority as the government seeks to make it a country that works for everyone.

At the same time, technological advances continue to alter the nature of work, creating the opportunities and challenges of automation, remote working and the gig economy. Job security and in-work poverty will continue to be big challenges facing national and local government. Fixing the skills deficit in the UK will not be easy or quick.

We already know that there are big policy changes on their way this year that will affect the UK labour market in different ways across the country. The National Living Wage will have the biggest impact on low paid cities such as Sheffield, where 28 per cent of people will get a pay rise in April. Questions remain about the long-term impact this will have on future growth – firms replacing people with robots, firms cutting or adding jobs, firms increasing their productivity – particularly in low waged cities.

If 2016 was the year of big decisions about Brexit and Trump, 2017 will be the year these are acted upon. While we know that the fundamentals of what makes city economies thrive have not changed – skills, infrastructure, innovation – how these fundamentals will be affected over the coming year is less clear. 

City regions will be vital to the UK making the most of its new role in the world – we need to do all we can in the months ahead to ensure they are well positioned to do so.

Alexandra Jones is chief executive of the Centre for Cities. 

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Is Britain’s housing crisis a myth?

Council housing in Lambeth, south London. Image: Getty.

I’ve been banging on about the need for Britain to build more houses for so long that I can no longer remember how or when it started. But at some point over the last few years, the need to build more homes has become My Thing. People ask me to speak at housing events, or @ me into arguments they’re having on Twitter on a Sunday morning in the hope I’ll help them out. You can even buy a me-inspired “Build More Bloody Houses” t-shirt.

It’s thus with trepidation about the damage I’m about to do to my #personal #brand that I ask:

Does Britain actually have enough houses? Is it possible I’ve been wrong all this time?

This question has been niggling away at me for some time. As far back as 2015, certain right-wing economists were publishing blogs claiming that the housing crisis was actually a myth. Generally the people who wrote those have taken similarly reality-resistant positions on all sorts of other things, so I wasn’t too worried.

But then, similar arguments started to appear from more credible sources. And today, the Financial Times published an excellent essay on the subject under the headline: “Hammond’s housebuilding budget fix will not repair market”.

All these articles draw on the data to make similar arguments: that the number of new homes built has consistently been larger than the number of new households; that focusing on new home numbers alone is misleading, and we should look at net supply; and that the real villain of the piece is the financialisation of housing, in which the old and rich have poured capital into housing for investment reasons, thus bidding up prices.

In other words, the data seems to suggest we don’t need to build vast numbers of houses at all. Have I been living a lie?

Well, the people who’ve been making this argument are by and large very clever economists trawling through the data, whereas I, by contrast, am a jumped-up internet troll with a blog. And I’m not dismissing the argument that the housing crisis is not entirely about supply of homes, but also about supply of money: it feels pretty clear to me that financialisation is a big factor in getting us into this mess.

Nonetheless, for three reasons, I stand by my belief that there is housing crisis, that it is in large part one of supply, and consequently that building more houses is still a big part of the solution.

Firstly I’m not sold on some of the data – or rather, on the interpretation of it. “There is no housing crisis!” takes tend to go big on household formation figures, and the fact they’ve consistently run behind dwelling numbers. Well, they would, wouldn’t they? By definition you can’t form a household if you don’t have a house.

So “a household” is not a useful measure. It doesn’t tell you if everyone can afford their own space, or whether they are being forced to bunk up with friends or family. In the latter situation, there is still a housing crisis, whatever the household formation figures say. And there is plenty of anecdotal evidence to suggest that’s the one we’re living in.

In the same way I’m not quite convinced that average rents is a useful number. Sure, it’s reassuring – and surprising – to know they have grown slower than general prices (although not in London). But all that figure tells you is the price being paid: it doesn’t tell you what is being purchased for that payment. A world in which renters each have their own property may have higher rents than one in which everyone gets one room in an over-crowded shared flat. It’s still the latter which better fits the label “housing crisis”.

Secondly, I’m entirely prepared to believe we’ve been building enough homes in this country to meet housing demand in the aggregate: there are parts of the country where housing is still strikingly affordable.

But that’s no use, because we don’t live in an aggregate UK: we live and work in specific places. Housing demand from one city can be met by building in another, because commuting is a thing – but that’s not always great for quality of life, and more to the point there are limits on how far we can realistically take it. It’s little comfort that Barnsley is building more than enough homes, when the shortage is most acute in Oxford.

So: perhaps there is no national housing crisis. That doesn’t mean there is not a housing crisis, in the sense that large numbers of people cannot access affordable housing in a place convenient for their place of work. National targets are not always helpful.


Thirdly, at risk of going all “anecdote trumps data”, the argument that there is no housing crisis – that, even if young people are priced out of buying by low interest rates, we have enough homes, and rents are reasonable – just doesn’t seem to fit with the lived experience reported by basically every millennial I’ve ever met. Witness the gentrification of previously unfashionable areas, or the gradual takeover of council estates by private renters in their 20s. 

A growing share of the population aren’t just whining about being priced out of ownership: they actively feel that housing costs are crushing them. Perhaps that’s because rents have risen relative to wages; perhaps it’s because there’s something that the data isn’t capturing. But either way, that, to me, sounds like a housing crisis.

To come back to our original question – will building more houses make this better?

Well, it depends where. National targets met by building vast numbers of homes in cities that don’t need them probably won’t make a dent in the places where the crisis is felt. But I still struggle to see how building more homes in, say, Oxford wouldn’t improve the lot of those at the sharp end there: either bringing rents down, or meaning you get more for your money.

There is a housing crisis. It is not a myth. Building more houses may not be sufficient to solve it – but that doesn’t meant it isn’t necessary.

Jonn Elledge is the editor of CityMetric. He is on Twitter as @jonnelledge and also has a Facebook page now for some reason. 

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