Rishi Sunak defends giving money to richer south-east England

Michael Gove has defended giving more levelling up money to the south-east of England than the north-east in the latest funding allocation.

The levelling up secretary has announced which local projects have won a share of a £2.1bn fund.

He said the north was getting more per head of population and some parts of the south needed investment.

Labour claimed north-east England was “one of the big losers” from a funding model it says is unfair.

A total of 111 areas across the UK have been awarded money from the second round of the government’s Levelling Up Fund.

The Eden Project in Morecambe, Lancashire, will get £50m to help regenerate a derelict site on the seafront into an eco-tourism attraction.

There will also be a £50m grant to build a new direct train service linking Cornwall’s largest urban areas.

But London boroughs will get more than both Yorkshire and the north-east of England.

Mr Gove argued the north of England and Wales would receive more per head of population.

He also said there were parts of southern England such as the Kent coast which had “real deprivation” and needed the extra investment.

Labour have argued the money does not make up for past cuts made by Conservative governments.

Shadow levelling up secretary Lisa Nandy said: “It takes an extraordinary arrogance to expect us to be grateful for a partial refund on the money they have stripped out of our communities.”

She also criticised the funding model, saying it was wrong to create winners and losers, and accused ministers of “playing favourites” with projects.

“I think this is the wrong way to go about allocating funding.” she told BBC Breakfast.

Ms Nandy said her party would not cancel the projects if it got into government, but would end the “competitive-style bidding” process.

The idea of “levelling up” – or reducing regional inequality – was a key part of Boris Johnson’s 2019 election campaign. Its aim was to close the gap between rich and poor parts of the country by improving services such as education, broadband and transport.

Prime Minister Rishi Sunak’s own constituency of Richmond, in North Yorkshire, will get £19m to develop the Catterick Garrison town centre.

The London Borough of Camden – where Labour leader Sir Keir Starmer has his constituency – will receive £7m for cycling and walking infrastructure and local GP services.

Other projects set to get funding include:

Overall this latest pot of funding sees the north-west of England receive the most money getting £354m.

The south-east comes second with £210m while London gets £151m.

Northern Ireland and the north-east are the regions allocated the least – £71m and £108m respectively.

The first pot of levelling up funding, announced in October 2021, saw £1.7bn awarded to 105 projects.

What is levelling up?

For many. it was a way of reallocating power and funding; from the south of England to communities that felt left behind, particularly in the north of England.

So the latest funding allocation has raised a few eyebrows.

Why does the south-east of England get more money than the north-east?

Why does London get more than Yorkshire?

The distribution will disappoint some and anger others.

The prime minister argues there are areas across the UK that need regeneration money, many of them in the south.

There are, of course, more people in the south of England than the north of England.

But there is a debate brewing over the government’s priorities – and the definition of levelling up.

Conservative party campaign headquarters have denied reports they have told MPs in marginal seats to stop using the phrase “levelling up” due to concerns the public do not know what it means.

A Conservative source told the BBC that MPs had “been told the precise opposite” and had instead been told how best to use the phrase based on the party’s opinion research.

The BBC has been told that, for example, MPs have been told not just to talk to constituents about how much money has been spent, but instead to talk about specific things that have changed for their area.

The Local Government Association (LGA) said the allocation of levelling up funding should be “locally led by evidence” of where investment is needed rather than “based on costly competitive bids between areas”.

“This is not a sustainable approach to economic development or public service delivery,” said Kevin Bentley, chairman of the LGA’s People and Places Board.

He also warned fulfilling projects had become more challenging due to rising inflation and costs.

Head of the Local Government Information Unit think tank Jonathan Carr-West said: “People will debate whether these allocations are right or fair but the real problem here is that this is a crazy way to fund local government.”

He argued that councils were putting “huge” resources into applying for the funds, diverting money from “other useful and necessary things”.