Levelling up Fund bias in favour of Tory seats ‘pretty blatant’

The Conservative government came to power in 2019 promising to “level up” prosperity across the UK. But its selection this week of the places needing most help has prompted accusations of political bias.

Opposition Labour leader Sir Keir Starmer charged ministers with “pork barrel politics” over how they had categorised local authorities under the new £4.8bn Levelling Up Fund, which the Financial Times reported favoured some prosperous Tory voting areas.

Further FT research has found that 11 areas in England represented solely by MPs from the Conservative party that are in the lower half of national deprivation rankings have been put in the fund’s highest category. The areas, including some of chancellor Rishi Sunak’s Richmond constituency in rural North Yorkshire, have been classified as “priority one” regions while some of the most deprived places in the country have been classed as “priority two”.

There are three categories, with roughly a third of Great Britain’s 384 local authorities in each.

FT analysis shows that all 14 local authority areas in England considered more prosperous than the national average that were placed in “priority one” had at least one Tory MP, while three had a Labour representative as well.

The government has yet to keep its promise to publish its selection methodology.

The FT used local authority deprivation indices from the communities and local government ministry to rank 313 local authorities in England by income and health and then added their political representation — although constituency and local authority boundaries do not often coincide.

Wales and Scotland’s deprivation indices are not directly comparable so they were not included.

The analysis found that Conservative areas were consistently placed in a higher priority category than their deprivation level and many Labour voting areas in a lower one.

Those classed as “priority one” have “the highest levels of identified need” for new infrastructure, which means their funding bids are more likely to succeed. 

The fund, which runs until 2025, focuses on town centre and high street regeneration, local transport, and cultural and heritage assets.

Richmondshire, which forms part of Sunak’s seat, ranks 288th for deprivation in terms of income and 256th for health. Other better-off places in priority one include the Derbyshire Dales, Forest of Dean, and Newark and Sherwood. The latter is represented by communities secretary Robert Jenrick, whose department drew up the rankings and will award the money. 

Salford, which ranks 12th for health and 32nd for income, is in priority two, along with depressed former mining towns such as Barnsley and Tory-controlled Bolsover.

There are 345 Conservative and 179 Labour MPs in England. Of the 93 local authorities in priority one, 51 have just Conservative MPs, 16 Labour and 26 both. 

Officials said a number of indicators were used, including the need for town centre and high street regeneration, small transport projects, and upgrading local cultural assets

Labour on Friday also attacked a second government development scheme, the Community Renewal Fund, for prioritising seven seats of cabinet ministers, including Sunak and Jenrick. 

This initiative, which will allocate £220m for projects, has a similar priority ranking system to the Levelling Up Fund.

Steve Reed, Labour’s shadow communities and local government secretary, said his party supported “funding for every region but it is crucial that it is done transparently, fairly and with a say for local communities”.

“This government is pitting regions and nations against each other for money that should reach communities as a matter of course,” he added

The Treasury defended its approach. “The bandings do not represent eligibility criteria — and money will be allocated to the areas most in need. Further technical details will be published by the government in due course.”

But Diane Coyle, Bennett Professor of Public Policy at Cambridge university, said the bias “is pretty blatant really”. “I am sure there are civil servants trying to retrofit the methodology to justify the rankings as we speak,” she told the FT’s Payne’s Politics podcast.

She also accused the government of “tokenism”. “I am a bit sceptical about to what extent these [funds] will make a difference. The scale of what we need to level up is enormous.”

The government has faced similar criticism when it chose 101 places to bid for the £3.6bn Towns Fund in 2019. Its selection triggered investigations by the National Audit Office and the public accounts committee of MPs.

The committee reported in November 2020 that it was “not convinced by the rationale for selecting some towns and not others”, with ministers’ reasoning “vague and based on sweeping assumptions”. It questioned whether the decisions were politically motivated.

Chris Hanretty, professor of politics at Royal Holloway, University of London, found that Conservative held areas were more likely to get approval to bid than similar places with an opposition MP.

On Wednesday, the government awarded £1bn to 45 of the 101 towns: 40 of the 45 have Tory MPs. 

In his Budget, Sunak said the government was keeping its promises to “level up”, as promised to voters. He announced a new Treasury office with 750 staff in Darlington, a town just north of his constituency which switched to the Tories, and that its infrastructure bank would be headquartered in Leeds. 

Places including Teesside, Liverpool and Humberside will get tax-friendly freeport designation to attract investment. 

Jake Berry, a former minister who chairs the Northern Research Group of Conservative MPs, welcomed the Budget as a “statement of intent by Rishi Sunak that he is committed to investing in the north”. 

But Nicola Headlam, who worked for Berry at the Northern Powerhouse unit within government from 2018-19, which is responsible for policy in the region, said the new approach lacked coherence. 

Rather than hand money and power to elected mayors and local authorities, they were left asking Whitehall for favours, she said. “There is no strategy. There is no plan for growth. It is short termist.”