UK's Burnham takes small-town regeneration to the national stage as PM

MANCHESTER/LONDON, July 16 - For Britain's next prime minister, Andy Burnham, a sprawling car park in the centre of a former cotton-manufacturing town in northwestern England represents everything wrong with prior development projects that have hollowed out UK town centres.

He wants to reverse that process by using public money to pump-prime housing, transport and urban renewal to attract the scale of private investment needed to rebuild such towns, with a focus on providing for the needs of the local population.

Burnham, who ran Greater Manchester as its mayor from 2017 until June, is expected to become Britain's seventh prime minister in a decade on Monday, replacing Keir Starmer.

He has so far disclosed little of his team's work on a first 100-day plan, or of his wider vision of how he plans to govern.

Yet at least 10 officials, former aides and people who worked with him told Reuters plans for places such as the town centre of Middleton, which locals describe as having become little more than a "drive through" because of the large car park and two major roads dissecting it, offer a starting point.

Like several post-industrial towns surrounding Manchester, Middleton's best days are long gone, with a shopping centre full of charity and budget shops, few decent jobs and rising anger in a population that feels left behind, said Rose Marley, a mayoral adviser in Manchester and now a co-chair on the Middleton Mayoral Development Corporation, launched last year.

The regeneration project is considering the construction of up to 1,200 new homes, commercial opportunities and investment in green spaces to restore pride to the town, Marley said of a project very much at the beginning of its multi-year life span.

It is this renewal of towns such as Middleton that will be a key political test for the Labour Party. The populist Reform UK, led by Nigel Farage, leads opinion polls and has gained ground in such places on the back of a loss of faith in the main political parties' ability to improve living standards.

'PLACE FIRST'

In his first speech after returning to parliament last month, Burnham, 56, said he wanted to build a more collaborative politics that puts "place first, not party first".

Before Middleton, that strategy was tested in the regeneration of another Manchester town, Stockport, where a £2 billion ($2.7 billion) programme has turned derelict streets into one of Britain's largest town-centre renewal projects.

The historic central Underbank quarter, dotted with empty shops a decade ago, is now busy again. A new transport interchange with a rooftop park is due to connect to Manchester's tram network.

Earlier this month, the Institute for Government think tank said Stockport, with its population of 300,000, was a successful town regeneration model, citing the delivery of 1,500 new homes since 2019, 200 of which were classed as "affordable" units.

The town plans to raise that figure to 8,000 by 2040.

"Collaborative politics is part of the secret sauce," said Gavin Barwell, once chief of staff to Conservative former prime minister Theresa May, who now chairs the Stockport Mayoral Development Corporation (SMDC).

SMDC has attracted £600 million of private investment and local authorities report a 40% year-on-year increase in visitors to the town's shopping centre.

The Middleton project is further off, but Marley hopes to publish the results of a local consultation soon, as the team presses to attract the kind of private and mutual funding needed to build housing, new public spaces and improve transport.

Marley said Burnham urged her to build support across party lines and now three local Reform councillors are engaged in the project.

NATIONAL PLAN

According to the former advisers and Labour insiders, Burnham wants to replicate the model across Britain. They describe the approach as being built on faster delivery, bringing in experts from outside government to get around a slower public sector, and cross-party cooperation.

He faces constraints, however.

Seeking to allay market fears of overspending, Burnham has committed to the fiscal rules that require the government to match day-to-day spending against revenue and Labour's 2024 tax pledge not to increase taxes on working people — leaving him little room for new outlays.

His approach, Burnham says, is based on attracting private investment with public capital — not waiting for the market to "magically solve the challenges that were left behind in the aftermath of deindustrialisation".

Burnham points to his decision to fund a residential block paired with Stockport's new transport interchange after the market judged it unviable.

"Were we going to let the market decide what Stockport could be, or were we going to do that? It has paid dividends already — that development is fully let," Burnham said in November.

Mark Roberts, the Liberal Democrat leader of Stockport Council, describes the model there as one which depends not just on construction for profit. For Middleton, Burnham has said companies that want to get involved must be willing to offer local youngsters apprenticeships.

REPLICATING MANCHESTER'S GROWTH

Burnham points to Greater Manchester's economic record as proof his approach works.

Greater Manchester's economy grew 17.4% between 2017 and 2023, the fastest of 46 British sub-regions and well above second-placed West England at 13.4%, according to official data.

Replicating that growth nationally will be harder.

Unlike other regions in rural and coastal Britain, Greater Manchester benefitted from decades of concentrated investment and the pull of a major city economy, helped by universities that are strong in science and research.

With Britain's next national election three years away, Burnham will also have to work quickly.

Starmer, who lost the backing of his Labour lawmakers in part for failing to stem the growing popularity of Reform, was punished for a slow start, losing the faith of just the companies his successor will be depending upon.

The Confederation of British Industry welcomed Burnham's focus on investment outside London while warning him not to further raise the cost of doing business, which it described as already at a "tipping point".

"Economic benefits of devolution are unclear, but the costs are tangible," said JPMorgan economist Allan Monks. "Some transitional costs in the near term appear likely, together with some loss in economies of scale. This could raise spending overall." REUTERS