The Northern Powerhouse cannot afford to ignore poor health

New life expectancy figures show the urgency of raising living standards in the north



Good news! We’re all going to live five years longer! That was the headline of more than one newspaper today. However a casual glance at the details showed that this rosy picture was misleading: the research behind it found that the north of England still ranks among the worst performing on life expectancy when compared to other EU nations.

These health disparities are due to unequal economic performance. The research found that levels of poverty are directly linked to health outcomes – the poorer the area, the lower the life expectancy.

IPPR North recently published figures on the disparity between north and south in Gross Disposable Household Income – the money people have available for spending or saving. We found that only five local areas were above the UK average for GDHI per person – and all 36 other northern areas all fall below the UK average (see below).

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The problem is stark: the north of England lacks well-paid, good quality work that will bring people financial security and improved wellbeing. In recent years the northern economy has grown more slowly than most EU nations (see below). Tackling this underlying cause has to be priority for the Northern Powerhouse.

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The opportunity is there. If it were a national economy, the north of England would rank as tenth largest in the EU, and if the north was able to halve the gap between its own economic output per head and the national level then its economy would be £34 billion (11.9 per cent) bigger.

Devolution of powers is a crucial element of this. Pursuing the smart regional policies of the future means handing down significant chunks of key budgets, such as skills, business support and infrastructure spending to groups of local authorities, who can act at a strategic level to best meet the needs of their respective populations.

Improving health is increasingly seen as relevant to local authorities as well. The government views the devolution of the £6bn health budget to Greater Manchester as an example to others.

Integrating health and social care, in particular, could be a crucial step towards enabling a more effective and person-focused approach, and a key tool in enabling better design of services.

In theory at least, devolution should deliver cost savings – and the risk is that Westminster will see it as a justification to reduce local budgets arbitrarily.

Central government and local authorities must be held to account, to ensure that saving money doesn’t mean services, and local populations, suffer.

In addition, the ability to act radically and strategically depends on financial certainty. If central government repeatedly cuts the budget allocations to local authorities then they are likely to act in a risk-averse manner. Better would be to allocate five, or even ten-year budget settlements that allow for local government to invest in their areas with confidence.

Ultimately, local authorities should be given much wider powers to raise funds, as well as spend them, to ensure that they can meet the needs of their population.

The figures published today spell out the scale of the challenge, and act as a reminder that the success of the Northern Powerhouse will depend on whether or not it can reverse current trends and boost the living standards of people living across the north. If we can’t do this – then what is the Powerhouse for?

Jack Hunter is a researcher at IPPR North. Follow him on Twitter

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