North-South divide under the spotlight (From The Northern Echo)

North-South divide under the spotlight

11:01am Friday 27th July 2007 in

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EXPERTS are visiting the region to examine why it still lags behind the wealthy South after a decade of Labour rule.

The highly-respected Organisation for Economic Cooperation and Development (OECD) will carry out a review into the low-level of business enterpreneurship across the North.

Its Innovation Review of the North of England, launched yesterday, will explore why the region performs poorly compared to other areas in Britain and in industrialised countries abroad.

The outcome of the review, which will last up to ten months, will be published in autumn 2008 and is expected to make recommendations to the Government and regional decision-makers.

The OECD describes itself as "a steering group for the world economy" and brings together Governments from 30 countries.

The move comes after a recent damning report concluded that Tony Blair's ten years in No 10 marked a widening of the North-South economic divide.

The study, by Professor Fred Robinson, a Durham University academic, found the region's economy had significantly improved since 1997, with incomes on the rise.

However, other regions had still performed better.

Prof Robinson's conclusion followed ten years during which former Chancellor Gordon Brown introduced a series of measures to try to stimulate business growth in the North.

Companies were offered tax cuts, exemption from stamp duty and venture captial funds to encourage them to locate in poorer areas, with regional development agencies set up to help.

But the battle has been fought against the backdrop of sharp decline in Northern manufacturing and a boom in Southern service industries.

The OECD will work alongside the likes of One NorthEast and Yorkshire Forward, along with the N8, an alliance of the eight leading research-intensive universities in the North.

Northern Way, which is co-funding the study, is a collaboration led by the three Northern regional development agencies - the other being the North-West - which wants to close the £30bn productivity gap over 25 years.

Andrew Lewis, director of Northern Way, said: "We need to develop our capacity to innovate if we're to raise the sustainable growth of our economy to levels.