Tony Blair was leader of the Labour Party from 1994 to 2007, and Prime Minister from 1997 to 2007. He is now head of the Tony Blair Institute for Global Change.
This interview was conducted on 7 October 2022.
Q: How much was the pattern of growth and inequality across the UK’s regions part of your thinking heading into government in 1997?
Regional inequality was a big part of my thinking. I represented a constituency in the North East. Many of the other key players represented constituencies in traditional Labour areas. There was a strong feeling that the Tories had been neglectful of the regions.
So, regional policy was a big factor: wanting to give a fair deal to the Labour areas where people felt that had been missing over the previous 18 years – despite the work of Michael Heseltine, particularly, in the last bit of the Tory government.
Q: Both John Major and Ken Clarke said to us that they had thought economic benefits would ‘trickle down’ to every region, but that didn’t happen. Was that already clear by 1997?
Yes, that was clear. We obviously weren’t going to do a ‘trickle down’ approach. My reflections now are a little different from what I thought when I came into office. When I came into office, we had a plan for Regional Development Authorities [RDAs]. We were very much concerned that they should be economic and not just social. In terms of public investment, obviously there was a lot more public investment over the 13 years of Labour government and that went into those areas. We did things that people don’t really remember nowadays, like the Miners’ Compensation schemes and so on. Just to put it out there right at the very beginning, I think my reflections today would be a little different.
So number one, if you look at those things that really drive economic development, I think the position of cities and universities are really important. We did a lot, in fact, to revive a lot of the cities. Cities like Newcastle and Liverpool, Glasgow, Cardiff…all of these places became much more interesting, much more vibrant places. But we didn’t really, until the end, start to understand the absolutely crucial relationship that was starting to develop between universities and economic development, which I think today is absolutely central.
Secondly, I think infrastructure is vital. I think building the right rail network today is an essential part of it. Because, if you can shrink the time it gets to travel between different spaces, you open up a whole lot of opportunities for people to live and work differently that are really important.
And the third thing is education, where, for example, in London – with the London Challenge – we made really quite substantial changes to London’s education system. But I don’t think we applied the same focus to some of the outlying regions. And therefore, if you look at where the tail of low -performing schools are in the UK today, they’re disproportionately in the regions. If I was back in government, I would still have the same desire, but the policy mix would be different.
Q: In 1997, would the regional issue have been more about jobs and unemployment than these more structural productivity drivers?
Yes, exactly. We put a lot of weight on the Regional Development Authorities, which I think were in some ways successful but in other ways less successful. Today I would be much more around those structural productivity issues. My basic view is that the technology revolution is driving everything today. Therefore, the most important thing, for example, is that you start to create clusters of activity around these higher education institutions, research and development, science and technology.
A second thing I’d say is this: one of the things you’ve always got to be careful of is you’ve got to know exactly what the problem is you’re trying to deal with. If you look at, for example, the Ile-de-France and Paris, as a region in France: it’s disproportionately wealthier than the outlying regions. If your position is relative to London, that’s your measure of regional success. Go back 100 years, probably: it’s always been the case that London has been significantly in advance. You’ve got to be careful of setting yourself a goal that may never be realised. I am tempered by experience. I think it is important to focus on the absolute as much as the relative.
Q: There is a view that London’s success has ended up distorting and blighting the economic outcomes of other parts of the country (for example, through a ‘brain drain’). Looking back, how did you think about the role of London in the British economy?
London is just a unique economic driver and always will be. It’s not only London now: you can look at Cambridge, for example. If you look at life sciences, Liverpool is now quite a successful player, as is Glasgow. I think it’s more productive to look at how you create the infrastructure that’s naturally going to pull resources towards it.
Let’s just take life science, because I know quite a lot about it now from the work we do as an Institute. It’s quite hard to compete. If you’re thinking as a government, ‘Where do I put money?’, it can be quite hard to say ‘I’m not going to put it into Imperial College, I’m going to put it into somewhere else,’ when it’s obvious at the moment that Imperial College is probably going to be ahead in developing new treatments and so on.
You’ve got to distinguish between choosing London because it’s London and accepting that on an objective basis that might be where you would, if you’re trying to grow your economy, put resource. The question is, how do you create a situation in which you say ‘No, actually, it makes more sense for us to put it into Newcastle or Durham because they’ve got the capability to do more with it?’
Q: How did your views develop over your time as Prime Minister about what worked?
I developed my view by experience. We did do what we said we would do. We set up the Regional Development Authorities. We actually put a lot more money into these areas. In my constituency – the surrounding ones, too – there were new community hospitals, there was investment in Building Schools for the Future. The tax credit system delivered a lot of benefits for the families in my constituency.
Over time, I came to the conclusion that universities were going to create clusters of, particularly, innovation and technological creativity, that ultimately were going to generate wealth. I remember doing visits both to Newcastle and Durham Universities where I realised that. If you aren’t able to do that, you risk – and this, of course, is what happened with austerity – that another government comes in and says, ‘Those aren’t our priorities.’ Then your region is not better off. So I changed my thinking over time as a result of experience.
Q: There was another agenda that you were enacting in 1997 around constitutional reform: the mayoralty in London, devolution to Scotland, Wales, the restoration of power sharing in Northern Ireland. How did you think about the constitutional status of the English regions in 1997? Did that thinking evolve over time?
I became more and more convinced that you needed to go down the mayoral route rather than the regional assembly route. John Prescott was very keen on the regional assemblies. It would be very nice and symmetrical if Scotland, Wales, Northern Ireland and the English regions felt the same degree of cohesion: but I just came to a conclusion that they didn’t.
My own constituency was an example of this. Tyneside and Teesside did not feel part of the same place. It just didn’t. York and Durham are a half an hour train ride away, but York is ‘down there’ and Durham was ‘here’. I mean, it just didn’t work. I think that mayoral route is a better route to go, that was my conclusion.
Q: Were there other places, other parts of the world, which you looked at and thought Britain should be learning more from?
I didn’t see anywhere that worked really, really well. I did study the German experience, which I think has got some reasonable lessons. Looking at the U.S. individual states, you can learn from that experience too. But in the end, you’ve got to go back to what is the problem. The problem is that – for a place, a city, a region, to be successful – there are certain things that you have just got to be very crude about; certain things that have to be present. Smart young people who are ambitious have got to want to stay there and believe they can stay there. I think that’s probably as important as any other single thing. When I was growing up in County Durham, the measure of your success was if you moved down south. If you stayed in County Durham, you kind of got into the second lane a little bit. Not with everyone, but that was the sense of it. So that is one thing that is absolutely critical.
The second thing is it’s got to be a good place to live. This is where the arts, and culture, and the school system, and health system matters, but the school system particularly, to think your children are going to get well educated there.
The third thing is, it’s got to be accessible. This is why infrastructure is so important.
And the fourth thing – which pulls all of those things together – is it’s got to be clear there’s an economic base that is interesting and, especially today, innovative.
When I think of this now, I think ‘What are the things that are particularly going to address that first thing, which is the capable and ambitious wanting to stay and not go?’ What are all the things you would put in place to make that happen? This is where I think, again, the technology side matters so much, because today you can work differently.
It’s interesting to think whether what we learned during COVID – in terms of the way people live and work today – might have some relevance to how you do regional policy. If you take just the people who work here at this Institute now, we’re not working the same anymore. A lot of people have moved out. Right now, at the moment, most of them moved reasonably close to London. But you just think about whether it’s possible, over time, to reimagine – if you have the infrastructure in place and you have the technology capabilities, the metaverse thing happens – you literally start to think you could reimagine the workplace and therefore reimagine where you live and how you live.
I think those are the things. I came to the conclusion at the end of it, that everything else you could do would be palliative.
If you really want to make a difference, it’s got to be because people are wanting it to happen, not because government’s directing them or telling them it’s a good idea or even providing some money.
Q: Our research looking at the past 30 years suggests that the problem is, increasingly, not a shortage of graduates in Leeds or Manchester or Newcastle but a lack of demand for graduates in those cities. What is it about the city regions which still means that they are underperforming in generating jobs for graduates?
Absolutely. The young people who leave… it’s not because they want to leave, it’s because if they want to be successful, they have to leave. I would say two things. One is that realistically, in absolute terms, they are doing better. You know what Manchester was like thirty years ago. Manchester today is completely different.
But, second, I think our economy is going to change. Britain is going to have to decide what its industrial future is. I think it’s about choosing certain areas – I would say life sciences, clean energy – where it really is going to be important that you make sure you have companies that are going to start growing and doing well in different parts of the country.
There’s no reason why they shouldn’t be. Take, for example, that company in Manchester, which is probably the only company in the world that can compete in the supercomputers for the future. If you have companies like that, that are supported and can grow, you probably would end up with highly paid graduate jobs being in those places. But I think it’s the only way you’re going to change that is through changing the nature of the local economy.
Q: Over the period 1997 to 2010, do you think the government overall understood the importance of the factors you have set out – R&D, industrial policy, improving housing and transport within cities?
Well, I certainly came to the realisation towards the end of my time. I remember actually visiting Durham University where we opened a whole new science technologies sector there, which has now got lots of companies spinning off from it. And, it was like a light going on for me. I suddenly thought, actually, this is going to do more for regional development than what we’ve been doing before.
With all the work we do abroad and in places like Africa, there’s a debate in development today. Countries spend a lot of money on aid. But in the end, I’ve become absolutely convinced that the only way these countries change themselves is helping them through the quality of their government. It’s about going to the fundamentals of what makes a place successful. What makes a region successful? If you can answer that question, you can answer the regional equality question.
Q: Is it fair to say that the government in 1997 started with a lot of scepticism about local government, and English devolution (hence only creating the London Mayor and pausing on regional assemblies)?
Yes, that’s absolutely true. But I did become very convinced that mayors were a good idea.
I wanted more of those. I’m completely on the mayoral side of the argument.
Q: But Labour didn’t really introduce any new metro mayors in its time in the office other than London? The first elections for the other metro mayors were in 2017.
I’m saying, I was already convinced when I was in office that it was the right solution. I remember we were pushing that one by the end.
Q: If it started with scepticism, how do you think attitudes towards devolution and local government leadership changed throughout that period?
I think that we started with this idea that you can try regional assemblies. But, as I said, I was always very sceptical about it and it didn’t work. On local government leadership, I think we were right to be sceptical of it.
I think it’s only when you’ve had the mayors that you can give the power and be happy with it. And now I think the question is whether you give much more power to those people. I remember towards the end of our time – I think Ian McCartney worked on this – there was the idea that we might actually devolve some power over welfare and benefits.
Q: RDAs were scrapped in 2010. Was that right? Were they inevitably not going to work, whether due to scale or the lack of democratic accountability?
No. I think they did more good than not. Now, you might say, did they do as much as they should have for the money that was put into them? I think there’s a case for RDAs, though I think that it’s insufficient.
Q: Did England, like Scotland and Wales, need a mechanism for political accountability in the regions for devolution to work?
I think there needs to be one. You need to decide the boundary of your electoral constituency in a way that makes sense for local people. That’s why I think the mayor is a better idea. But, second, you need political competition to come around one person. That’s where I think there was an advantage for mayors: if you just had a leader of a local council, you didn’t have the ability for someone to come through and have a great idea and run a campaign that was not traditional between parties.
Q: When we spoke to Michael Heseltine, he said the fundamental failure came in 1972, when the Heath government ducked local government reorganisation – especially ending two-tier authorities. As Prime Minister, did you ever have any appetite for reorganising local government?
Some. But, as I knew from my own area, unitary authority debates were massively difficult. But yes, I think that’s a fair point that Michael is making.
Q: Given your point on the importance of reform making sense to local people, is the right approach to reform ‘evolutionary’, as with the current government’s approach to mayors? Or does it need to be more centrally driven to make it comprehensive?
I think it probably it does need to be centrally driven, yes. It’s very difficult to do it when there is huge opposition locally, but I think the evidence is that the mayoral systems work. I think that pushing for regional mayors is one part of creating a more powerful region. The advantage of having one person standing is that they’re able to define a mission, in a practical and not very political way.
Where you get parts of the world where there’s a fixed party politics that operates, I don’t think a) that that’s the way people think about politics today – it’s quite old fashioned; and b) it’s not good, because you don’t get innovation.
Q: In a world in which cities are the engines of growth, what’s the future of somewhere like Sedgefield? What governance arrangements would best help it to deliver that future?
If you treat it as County Durham, because the Sedgefield constituency has many different types of place, some of which are commuter belts and very pretty villages and some of which are old mining towns, the best thing would be a County Durham-wide Mayor.
Q: And is County Durham big enough to be the growth pole for Sedgefield, as opposed to Sunderland, Middlesbrough or Newcastle?
All of these places could develop in their own way, and they’re not necessarily exclusive from each other. But Durham City, because of its university and because of its developments in the science and technology sphere, could do. But 25 minutes in the car and from a lot of places in County Durham you’re in the middle of Newcastle.
Q: If you are Sedgefield, then actually you want to be part of the Newcastle economy as well? So a wider North East deal may have made sense there?
Absolutely. In some ways, the one referendum which ought to have been won is the [2004 North East Regional Assembly] one that was lost. There’s no reason why you shouldn’t do this. You might decide that you want a One North East. The dealings I had with it, going back sometime obviously, were pretty good, actually. But there was never any way you were going to get a Northern Assembly agreed. People just didn’t want it. If you were in County Durham, you felt Yorkshire was… I mean, ‘They were from Yorkshire.’ And Northumberland, totally different again.
Q: So if you go for the elected mayor route you have to go for a smaller area?
You do.
Q: In the absence of effective local or regional governance, it leads you to national government driving policy. Do you think that Whitehall was effective at helping drive regional growth?
No, I don’t think so. I don’t think we had the right analysis and the right tools. I think there’s a basic inconsistency, by the way, in thinking you can create from the centre the ability for a region to function and succeed. In the end it’s got to be done locally. It can’t be done any other way.
Q: Was it inevitable that the focus of policy was always going to be national – whether because of the delivery focus of New Labour, or national raising and allocation of taxes?
Yes, that’s true. If you’re going to build the infrastructure, the allocation of money and so on is always going to be driven from the centre. But I would have felt much more confident about devolving some of the delivery if I had been confident of the institution or the person to which I was devolving it. I just didn’t have that degree of confidence in some of the local leadership. For some of the things we were trying to do on school reform and health reform, I think, if we’d have left it at that point to the regions, we wouldn’t have got a lot of stuff done.
Q: Taking post-16 education spending (adult skills) as an example, business kept asking to be allowed to shape skills provision according to the needs of regions and sub-regions. But central government was reluctant to devolve that to RDAs. Was that a mistake?
I think a lot of that is easier to do now. One of the things you do when you have a system of accountability that’s not based on a traditional party council type of system, is that you’re able to delegate more. That’s because of the types of people who are standing as mayors. I think you’ll find they’re different types of people.
Q: We heard from more recent reforms – George Osborne, Greg Clark – that they faced continual opposition from some Whitehall departments, even as Treasury took a driving seat in reform. So central resistance is a problem here too?
Yes and you will have to overcome that in time. But I do think that resistance was often justified without knowing it was going to be a forward-thinking leader who’s going to take those challenges on.
Q: So, the best defence is that until you saw the reality of elected mayors, you couldn’t have chosen to trust them ex ante?
I think it would have been difficult. And by the way, you can see from what’s happened in Scotland and Wales where we devolved and there was really an absence of reform there.
Q: What is the most important thing for us to learn from your time in office, and what is the biggest frustration where you feel you ought to have done better?
I think the most positive thing to learn from is that – even if the cities are not as good as they should be – they were a lot better than they were. There are learnings from that that are important.
I think the biggest frustration is that, for this to work, you need a coherent policy pursued over probably a 15- to 20-year period in order for the thing to have a result. That’s why if you can take it out of, as it were, ‘small’ politics and put it into ‘big’ politics, it would be very valuable.
I think the one thing that will happen in politics in the next 10 years is that, at some point, people will realise that we are in a completely new age where ideological solutions are just a distraction. What it really requires is analysis and understanding. It’s why it’s so important for Labour, when it comes in, to make it clear that you’re going to try and put at least a core, a spine, of policy down that a sensible Conservative government in the future could also follow.
ENDS