Richard Derecki: ‘Levelling up’ within London – lessons of the Olympics ‘convergence’ goal

Richard Derecki: ‘Levelling up’ within London – lessons of the Olympics ‘convergence’ goal

Many promises were made around the time of the London 2012 Olympic and Paralympic Games, before the bid was won, during the preparations and in the afterglow of its success. It was going to be greenest Games ever, local jobs were to be created as the venues went up, people would be more involved with sport, London would be showcased as a welcoming city. There was to be, to coin a phrase, a “lasting legacy” beyond the few weeks of sporting endeavour built on investment in the Olympic Park and improvement of the London Overground.

Some of those commitments were met, fully or partly. Others were ignored and then forgotten. But one promise gained traction at local, regional and national level. It was, upon reflection, quite breathtaking and merits renewed attention, not only from the point of view of the capital but also of the whole of the UK.

The Games were to be used as a catalyst to spur the regeneration of a largely unloved corner of east London, with its criss-cross of high voltage power lines, contaminated industrial land and car breaker yards, and to transform the overall dynamic of the London economy. “Convergence”, or what we might now call “levelling-up”, was going to improve the performance and prospects of communities in the host boroughs – Newham, Hackney, Tower Hamlets, Greenwich, Waltham Forest and Barking & Dagenham, later renamed the “Growth Boroughs” – by bringing the life outcomes of their residents closer to those of the average for Londoners as a whole.

The goal of convergence had support from across the tiers of government. It was embedded in the London Plan and the then Mayor, Boris Johnson, pledged to help “develop and implement a viable and sustainable legacy…of fundamental economic, social and environmental change within east London.” It had support from central government departments, including the Department for Work and Pensions, and from other partners, such as the East London Business Alliance.

The process would take a while – 20 years was the time horizon – but there was an a strategy document, an action plan and even a Growth Boroughs unit to pull together and align the different spending programmes and drive the whole thing forward. To enhance transparency, there were 22 social and economic indicators to track progress. (It is noticeable that no similar architecture exists to help define the present national government’s levelling-up vision, and that may be deliberate. Rhetoric becomes much less powerful when ministers are held accountable by pesky targets).

The infrastructure boost of the Games had a significant initial impact on job opportunities and economic growth in the host boroughs. The Olympics provided local job opportunities both during the construction phase and at the time of the Games. The Queen Elizabeth Olympic Park continues to be totally transformed, with new housing, business and green space and a boost to culture and creative industries, with more to come as the East Bank emerges off the architects’ drawing boards. The role of Stratford’s Westfield shopping centre in helping to re-brand the area and create jobs is also an important part of the site’s evolution.  

Nevertheless, amid concerns that the initial benefits of hosting the Games were wearing off, the leaders and Mayors of the Growth Boroughs soon agreed that a “step change” in the efforts to support convergence was needed. The Growth Boroughs Partnership therefore published a new convergence strategy, endorsed by the Greater London Authority, for 2015-2018, again with action plans, targets and timeframes. The focus was on transport projects such as the Barking Riverside extension and a raft of measures to support skills and employment prospects in five key sectors with growth potential, such as health and social care and the creative and digital industries. 

A snapshot of data made available in 2017 showed that across the education indicators, such as pupils achieving five good GCSEs, strong progress was being made and that the employment rate gap had closed. However, progress towards meeting health and adult skills targets was stalling and for some targets, such as childhood obesity and median wage levels, the gap had actually got worse. To be fair to the ambition, many of these indicators are tracking long term problems in the boroughs, so shifts on poor skill levels, low incomes and shorter life expectancy would be expected to take a considerable number of years to realise and be unlikely to follow a linear process. As Bridget Rosewell, former chief economist for the GLA, writes in London’s Mayor At 20, “Overall, while a gap remains, it is noteworthy that the initiative has partly succeeded in narrowing the divide. Such changes, after all, typically take generations rather than years to succeed.”

And then…and then the Convergence project went quiet. The Growth Boroughs Unit went into “hibernation” as, according to Professor Ralph Ward, a regeneration advisor to the government at the time of the Olympics, “the steam went out of the idea as we entered the age of austerity.” And worse was to come. As Ward points out, “Government inspired cuts hit the very services that would have benefitted local people, such as social services and children’s services. Newham and Tower Hamlets, in particular, faced huge cuts.” 

Despite this, across London some interesting things were happening. The city’s boroughs have seen a relative decrease in their levels of deprivation between 2015 and 2019. According to the Index of Multiple Deprivation (IMD) for 2015, eight London Boroughs were ranked in the most deprived 30% of local authorities nationally, including Tower Hamlets, Hackney and Waltham Forest. But the 2019 IMD ranks only three London boroughs in the most deprived three deciles, only one of which is a Growth Borough, that being Hackney. Tower Hamlets has become considerably less deprived on this measure, ranking 24 in the 2015 IMD index and 175 in 2019, indicating that the neighbourhoods within the authority have become significantly less deprived relative to others in England.

In summary, while the convergence indicators show a mixed picture of progress for the Growth Boroughs in comparison with the London average, the IMD suggests improvement in deprivation in comparison with England as a whole. This may be, in part, due to the “rising tide effect” of London’s continued strong growth and the possible effects of gentrification. However, the process of population mobility and churn has the effect of diluting the poorer population rather than tackling the inequalities and reducing it in absolute numbers. Concerns about those left behind are reflected in data for child poverty, measured after taking account of housing costs, which show that Tower Hamlets, Newham and Hackney are those with the highest rates in the UK at 56.7%, 51.8% and 48.1% respectively.

Drawing lessons from the Convergence project for the national government ambition of levelling-up the English regions, especially in the North are inevitably partial – for one thing, the scale is so different – but for Professor Ward government interventions need to ensure there is a combination of infrastructural investment and skills and employment support, and the commitment has to be to a multi-year programme built around a common understanding of what is trying to be achieved. Levelling-up has to be a process that is owned by local communities, not something that is done to them. It is they who need to define it and drive it forward. As IPPR North note in their response to the recent Spending Review: The North needs substantial devolution to make investment decisions, develop new projects, and deliver them at speed. Only by giving the North the power and resources to act, can we get our economy back into gear, and… help[s] people in the North to realise their potential.”

Levelling-up, whether within London or between different parts of the UK, cannot simply be about creating pockets of prosperity or evenly diluting the poverty within regions. This would simply create even greater intra-regional inequalities – which would be rather missing the point. 

Richard Derecki is an economist and governance expert who has worked for the 10 Downing Street strategy unit and the Greater London Authority. Follow Richard on Twitter.

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Categories: Analysis

1 Comment

  1. Alan Griffiths says:

    No mention of the house price bubble?
    That’s what’s driving the increase in multi-generation households, teh reduction fo owner-occupationa nd hte growth of private renting.
    New building, despite the scale of it, is merely feeding these problems, not reducing them.

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