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GOVERNMENT plans to level up Britain’s cities will require investment that goes “far beyond anything currently being contemplated” by the Tories, a think tank has said.
A report published today by the Resolution Foundation found that differences in income were both “significant” and “persistent,” with only traditionally poorer areas of inner London such as Hackney and Newham significantly improving their position over the last 25 years.
At its most extreme, the report found that income per person in the richest part of the country, Kensington and Chelsea, was 350 per cent higher than income per person in Nottingham, the poorest part.
These gaps are reinforced by differences in income from investments, the report said.
In 2019, residents of Camden received an average of £9,135 from investments, while those in Knowsley, one of the most deprived boroughs in the country, received an average of just £806.
Resolution Foundation research director Lindsay Judge said that Britain is “beset” by huge economic gaps between different parts of the country and has been for many decades.
“While progress has been made in reducing employment gaps, this been offset by a surge in investment income among better-off families in London and the south-east,” she said.
“The key to closing these gaps is to boost the productivity of our major cities outside London, which will also lead to stronger growth overall.”
But closing those productivity gaps will be challenging and expensive, the report warned.
In another report due to be released on Thursday, the Resolution Foundation will argue that current government policies do not go far enough.
The think tank said that closing that gap in Manchester, where productivity is 30 per cent lower than London, would require tens of billions of pounds of investment, more graduates working in the city and an extra 300,000 workers moving to Greater Manchester.
London School of Economics economic geography professor Henry Overman said: “Those looking for Britain’s productivity problems can find them in our underperforming major cities.
“Addressing this challenge will require Britain to completely turn around its poor record on investment, to take hard-headed decisions on where this investment should be prioritised and for cities to embrace growth.”
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