Record £41 billion per year for Scotland in budget

‘The Budget delivers for people in Scotland’

  • UK Government will provide a record £41 billion per year to the Scottish Government.
  • Scotland will also benefit from UK-wide support for people and businesses, green jobs and investment to level up opportunities.
  • Targeted funding will support local projects across Scotland, including road and infrastructure improvements, investment in local communities and funding for businesses.

The Chancellor today announced Barnett-based funding for the Scottish Government of £41 billion per year – delivering the largest annual funding settlement, in real terms, since devolution over 20 years ago. This includes a £4.6 billion per year spending boost – as part of a Budget and Spending Review that delivers a stronger economy for the whole of the UK.

Rishi Sunak set out a plan to deliver the priorities of the British people by investing in stronger public services, levelling up opportunity, driving business growth and helping working families with the cost of living.

As part of the significant spending plans, Scotland will receive an average of £41 billion per year in Barnett-based funding representing a 2.4% rise in the Scottish Government’s budget each year. The Scottish Government will now receive around £126 per person for every £100 per person of equivalent UK Government spending in England.

Chancellor of the Exchequer, Rishi Sunak said: “This is a budget for the whole of the UK. We’re focused on what matters most to the British people – the health of their loved ones, access to world-class public services, jobs for the future and tackling climate change.

“By providing record funding, the Scottish Government can tackle backlogs in the NHS and ensure people in Scotland get the support they need as we recover from the pandemic.

“The UK Government continues to level up opportunities across all parts of the UK, with investments in green jobs and high-speed internet access for thousands more homes in Scotland through Project Gigabit.

Scottish Secretary, Alister Jack said: “The Budget delivers for people in Scotland, and right across the UK.

“The Scottish Government’s block grant, boosted by an additional £4.6 billion a year due to spending in England, means that the funding for the Scottish Government is the highest it has ever been.

“It demonstrates our commitment to level up right across the UK. The Budget ushers in an era of real devolution, ensuring money is spent on projects that matter most to people in Scotland.

“The UK Government made a clear commitment to maintain Scotland’s level of funding following the vote to leave the EU, and we have delivered on that promise. We are taking decisions in the UK rather than in Brussels and dealing directly with local authorities who know their communities best.

“From the Knoydart community pub, to Dumbarton town centre and the Granton Gasworks – all these projects will bring real, visible improvements for local communities. Special funding for Glasgow’s iconic Burrell Collection and Extreme E will help drive economic growth and jobs on the back of culture and tourism.

“The continuation of the freeze on spirit duty will be a boost to Scotland’s thriving whisky industry.

“Over the past 18 months the UK Government has been focused on protecting people’s livelihoods, their incomes, and their jobs. We now need to look to the future, to build a stronger economy for people in all parts of the UK.”

Targeted funding in Scotland

On top of the record funding for the Scottish Government, Scotland will benefit from the UK Government’s commitment to invest in people, jobs, communities and businesses. Targeted projects in Scotland include:

Over £200 million to be invested in Scotland to boost the post-pandemic recovery and enhance the Scottish economy, including:

  • £172 million of the Levelling Up Fund for 8 important projects including the redevelopment of Inverness Castle, the much-needed renovation of the Westfield Roundabout in Falkirk, and a new marketplace in Aberdeen City Centre.
  • Over £1.07 million of the Community Ownership Fund for five projects in Whithorn, Inverie, New Galloway, Kinloch Rannoch and Callander that are protecting valued community assets.
  • Providing £1.9 billion for farmers and land managers and £42.2 million to support fisheries.
  • Up to £1 million, to support the delivery of a ‘green’ formula E race showcasing Hebridean Green Hydrogen to a global audience.
  • Expanding the existing trade and investment hub in Edinburgh to grow trade for Scotland.
  • Up to £3 million to bring world-class art exhibitions to the Burrell Collection in the heart of Glasgow.

UK-Wide Support

As a result of our strong United Kingdom, Scotland will benefit from:

  • A 50% cut in domestic Air Passenger Duty for flights between England, Scotland, Wales and Northern Ireland and an additional £22.5 million of new funding in anticipation of the Union Connectivity
  • Review recommendations where we will work with the devolved administrations on improving UK-wide connectivity.
  • New funding for the British Business Bank to establish a £150 million fund in Scotland, helping Scottish businesses to get the financing they need.
  • The new £1.4 billion Global Britain Investment Fund which will support investment directly into Scotland.
  • A record £20 billion by 2024-25 in Research and Development supporting innovation in Scotland.
  • Confirmation that total funding will at a minimum match the size of EU Funds in Scotland, each year through the over £2.6bn UK Shared Prosperity Fund, which will invest in skills, people, businesses, and communities, including through ‘Multiply’, a new adult numeracy programme that will provide people across Scotland with essential numeracy skills.
  • An increase to the National Minimum Wage of £9.50 an hour, with young people and apprentices also seeing increases.
  • Freezes to fuel duty for the twelfth consecutive year and a freeze on Vehicle Excise Duty for heavy goods vehicles.
  • A freeze on alcohol duty, which will mean that whisky benefits from the lowest real terms tax rate since 1918.

BUDGET REACTION

Rachel Reeves MP, Labour’s Shadow Chancellor, responding to the Budget, said: Families struggling with the cost of living crisis, businesses hit by a supply chain crisis, those who rely on our schools and our hospitals and our police – they won’t recognise the world that the Chancellor is describing. They will think that he is living in a parallel universe.

The Chancellor in this budget, has decided to cut taxes for banks. So, Madame Deputy Speaker, at least the bankers on short haul flights sipping champagne will be cheering this budget today.

And the arrogance, after taking £6 billion out of the pockets of some of the poorest people in this country, expecting them to cheer today for £2 billion given to compensate.

In the long story of this Parliament, never has a Chancellor asked the British people to pay so much for so little.

Time and again today, the Chancellor compared the investments that he is making to the last decade. But who was in charge in this lost decade? They were.

So, let’s just reflect on the choices the Chancellor has made today – the highest sustained tax burden in peacetime.

And who is going to pay for it?

It’s not international giants like Amazon – the Chancellor has found a tax deduction for them. It’s not property speculators – they’ve already pocketed a stamp duty cut. And it’s clearly not the banks  – even though bankers’ bonuses are set to hit a record high this year.

Instead, the Chancellor is loading the burden on working people. A National Insurance Tax rise – on working people. A Council Tax hike – on working people. And no support today for working people with VAT on their gas and electricity bills.

And what are working people getting in return? A record NHS waiting list, with no plan to clear it, no way to see a GP and still having to sell their home to pay for social care.

Community policing nowhere to be seen, a court backlog leaving victims without justice and almost every rape going unprosecuted.

A growing gap in results and opportunities between children at private and state schools. Soaring number of pupils in supersize classes and no serious plan to catch up on learning stolen by the virus. £2 million announced today – a pale imitation of the £15 billion catch up fund that the Prime Minister’s own education tsar said was needed. No wonder, Madame Deputy Speaker, that he resigned.

Now the Chancellor talks about world class public services. Tell that to a pensioner waiting for a hip operation. Tell that to a young woman waiting to go to court to get justice. Tell that to a mum and dad, waiting for their child the mental health support they need.

And the Chancellor says today that he has realised what a difference early years spending makes. I would just say to the Chancellor, has he ever heard of the Sure Start programme that this Tory government has cut?

And why are we in this position? Why are British businesses being stifled by debt while Amazon gets tax deductions?

Why are working people being asked to pay more tax and put up with worse services?

Why are billions of pounds in taxpayer money being funnelled to friends and donors of the Conservative party while millions of families are having £20 a week taken off them?

Madame Deputy Speaker, why can’t Britain do better than this?

The Government will always blame others. It’s business’ fault, it’s the EU’s fault, it’s the public’s fault.

The global problems, the same old excuses. But the blunt reality is this – working people are being asked to pay more for less for three simple reasons:

  •     Economic mismanagement,
  •     An unfair tax system,
  •     And wasteful spending.

Each of these problems is down to 11 years of Conservative failure and they shake their heads but the cuts to our public services have cut them to the bone. And while the Chancellor and the Prime Minister like to pretend they are different, the Budget they’ve delivered today will only make things worse.

The solution starts with growth. The Government is caught in a bind of its own making. Low growth inexorably leads to less money for public services, unless taxes rise.

Under the Conservatives, Britain has become a low growth economy. Let’s look at the last decade – the Tories have grown the economy at just 1.8 percent a year.

If we had grown at the same rate as other advanced economies, we could have spent over £30bn to invest in public services without needing to raise taxes.

Let’s compare this to the last Labour Government. Even taking into account the global financial crisis, Labour grew the economy much faster – 2.3 percent a year.

If the Tories matched our record, we would have spent £30bn more on public services without needing to raise taxes.

It could not be clearer. The Conservatives are now the party of high taxation, because the Conservatives are the party of low growth.

The Office for Budget Responsibility confirmed this today – that we will be back to anaemic growth. The OBR said that by the end of this Parliament, the UK economy will be growing by just 1.3%. Which is hardly the  plan for growth that the Chancellor boasted about today, hardly a ringing endorsement of his announcements.

Under the Tory decade we have had ow growth and there’s not much growth to look forward to.

The economy has been weakened by the pandemic but also by the Government’s mishandling of it.

Responding to the virus has been a huge challenge. Governments around the world have taken on debt, but our situation is worse than other countries.

Worse, because our economy was already fragile going into the crisis. Too much inequality, too much insecure work, too little resilience in our public services.

And worse, because the Prime Minister dithered and delayed, against scientific advice – egged on by the Chancellor – we ended up facing harsher and longer restrictions than other countries.

So, as well as having the highest death toll in Europe, Britain suffered the worst economic hit of any major economy.

The Chancellor now boasts that we are growing faster than others, but that’s because we fell the furthest.

And whilst the US and others have already bounced back to pre-pandemic levels, the UK hasn’t. Our economy is set to be permanently weaker.

On top of all of that, the Government is now lurching from crisis to crisis. People avoiding journeys because they can’t fill up their petrol tank is not good for the economy. People spending less because the cost of the weekly shop has exploded is not good for the economy. And British exporters facing more barriers than their European competitors because of the deal that this government did is not good for the economy.

If this were a plan, it would be economic sabotage. When the Prime Minister isn’t blagging that this chaos is part of his cunning plan, he says he’s “not worried about inflation.”

Tell that to families struggling with rising gas and electricity bills, with rising prices of petrol at the pump and with rising food prices. He’s out of touch, he’s out of ideas and he’s left working people out of pocket.

Madame Deputy Speaker, Conservative mismanagement has made the fiscal situation tight. And when times are tight it’s even more important to ensure that taxes are fair, that taxpayers get value for money. But the Government fails on both fronts.

We have a grossly unfair tax system with the burden heaped on working people.

Successive budgets have raised council tax, income tax and now National Insurance. But taxes on those with the broadest shoulders, those who earn their income from stocks, shares, and property portfolios have been left largely untouched.

Businesses based on the high street are the lifeblood of our communities and often the first venture for entrepreneurs.

But despite what the Chancellor has said today, businesses will still be held back by punitive and unfair business rates. The Government has failed to tax online giants and watered-down global efforts to create a level playing field.

And just when we need every penny of public money to make a difference, we have a government that is the by-word for waste, cronyism and vanity projects.

We’ve had £37 billion for a test and trace system that the spending watchdog says, ‘treats taxpayers like an ATM cash machine’. A yacht for ministers, a fancy paint job for the Prime Minister’s plane and a TV studio for Conservative Party broadcasts, which seems to have morphed into the world’s most expensive home cinema.

£3.5bn of Government contracts awarded to friends and donors of the Conservative Party, a £190 million loan to a company employing the PMs former Chief of Staff, £30 million to the former Health Secretary’s pub landlord. And every single one of those cheques signed by the Chancellor.

And now he comes to ordinary working people and asks them to pay more. More than they have ever been asked to pay before and at the same time, to put up with worse public services. All because of his economic mismanagement, his unfair tax system and his wasteful spending.

There are of course some welcome measures in this budget today, as there are in any budget.

Labour welcomes the increase in the National Minimum Wage, though the Government needs to go further and faster. If they had backed Labour’s position of an immediate rise to at least £10 an hour then a full-time worker on the minimum wage would be in line for an extra £1,000 a year.

Ending the punitive public sector pay freeze is welcome, but we know how much this Chancellor likes his smoke and mirrors. So, we’ll be checking the books to make sure the money is there for a real terms pay rise.

Labour also welcomes the Government’s decision to reduce the Universal Credit taper rate, as we have consistently called for. But the system has got so far out of whack that even after this reduction, working people on universal credit still face a higher marginal tax rate than the Prime Minister. And those unable to work – through no fault of their own – still face losing over £1000 a year. And for families who go out to work everyday but don’t get government benefits, on an average wage, who have to fill up their car with petrol to get to work, who do that weekly shop and who see their gas and electricity prices go up – this budget today does absolutely nothing for them.

We have a cost-of-living crisis.

The Government has no coherent plan to help families to cope with rising energy prices. Whilst we welcome the action taken today on Universal Credit, millions will struggle to pay the bills this winter.

The Government has done nothing to help people with their gas and electricity bills with that cut in VAT receipts as Labour has called for. A cut that is possible because we are outside the European Union and can be funded by the extra VAT receipts that have been experienced in the last few months.

Working people are left out in the cold while the Government hammers them with tax rises.

National Insurance is a regressive tax on working people, it is a tax on jobs.

Under the Chancellor’s plans, a landlord renting out dozens of properties won’t pay a penny more. But their tenants, in work, will face tax rises of hundreds of pounds a year. And he is failing to tackle another huge issue of the day. Adapting to climate change.

Adapting to climate change presents opportunities – more Jobs, lower bills and cleaner air. But only if we act now and at scale. According to the OBR, failure to act will mean public sector debt explodes later, to nearly 300% of GDP.

The only way to be a prudent and responsible Chancellor is to be a Green Chancellor. To invest in the transition to a zero-carbon economy and give British businesses a head-start in the industries of the future.

But with no mention of climate in his conference speech and the most passing  of references today, we are burdened with a Chancellor unwilling to meet the challenges we face.

Homeowners are left to face the costs of insulation on their own, industries like steel and hydrogen are in a global race without the support they need and the Chancellor is promoting domestic flights over high speed rail int he week before COP26.

It is because of this Chancellor that in the very week we try and persuade other countries to reduce emissions, this Government can’t even confirm it will meet its 2035 climate reduction target.

Madame Deputy Speaker, everywhere working people look at the moment they see prices going up and shortages on the shelves. But this Budget did nothing to address their fears.

Household budgets are being stretched thinner than ever but this Budget did nothing to deal with the spiralling cost of living. It is a shocking missed opportunity by a government that is completely out of touch.

There is an alternative.  Labour would scrap the business rates and replace it with something much better by ensuring online giants pay their fair share. That’s what being pro-business looks like.

We wouldn’t put up National Insurance for working people, we would ensure those with the broadest shoulders pay their share. That’s what being on the side of working people looks like.

We’d end the £1.7 billion subsidy the Government gives private schools and put it straight into local state schools. That’s what being on the side of working families looks like.

We’d deliver a climate investment pledge – £28bn every year for the rest of the decade. That’s Giga-factories to build batteries for electric vehicles, a thriving hydrogen industry and retrofitting, so we keep homes warm and get energy bills down. That’s what real action on climate change looks like.

This country deserves better but they’ll never get it under this Chancellor who gives with one hand but takes so much more with the other.

The truth is this – what you get with these two is a classic con game. It’s like one of those pickpocketing operations you see in crowded places. The Prime Minister is the front man – distracting people with his wild promises. All the while, his Chancellor dips his hand in their pocket. It all seems like fun and games until you walk away and realise your purse has been lifted.

But people are getting wise to them. Every month they feel the pinch. They are tired of the smoke and mirrors, of the bluster, of the false dawns, of the promises of jam tomorrow.

Labour would put working people first. We’d use the power of government and the skill of business to ensure that the next generation of quality jobs are created right here, in Britain.

We’d tax fairly, spend wisely and after a decade of faltering growth, we’d get Britain’s economy firing on all cylinders.

That is what a Labour budget would have done today.

Edinburgh Pentlands SNP MSP Gordon MacDonald said that the Tory UK Government’s budget makes it clear that “independence is the only way to give Edinburgh a fair recovery from the pandemic.”

Gordon MacDonald said that the budget, described by the head of the Institute for Fiscal Studies as “actually awful” for living standards, is failing the people of Scotland by failing to tackle the cost of living crisis, the Brexit crisis and the climate crisis whilst the Tory Government prioritise cuts to the cost of champagne and giving tax breaks to bankers.

The Edinburgh Pentlands MSP said: “What the Tory UK Government has outlined today does not meet the ambition needed to build a fair and sustainable recovery and to tackle the cost of living crisis.

“It’s painfully clear that there will be no fair recovery from the pandemic under Westminster control.

“This Tory budget fails Scotland as a whole and doesn’t go anywhere near supporting people in Edinburgh, who are being hit by an energy crisis, a Brexit crisis, labour shortages and an inflation crisis under Westminster control.

“The UK Government budget is leaving families in Edinburgh hundreds of pounds worse off next year due to Tory cuts, tax hikes and the soaring cost of Brexit.

It’s little wonder that, in May’s election, the people of Scotland voted overwhelmingly for a different future when they gave the SNP the highest share of the vote since the dawn of devolution and a clear mandate for an independence referendum – Independence is the only way to keep Scotland safe from Tory cuts.”

Commenting on today’s budget and spending review (Wednesday), TUC General Secretary Frances O’Grady said: “The chancellor has gone from pay freeze to pay squeeze.

“The chancellor admitted that we will have zero pay growth across the economy next year. And he has no plan to get real wages rising for everyone after an eleven year pay squeeze, with average real pay growth over the next four years predicted to be just 0.3 per cent.

“Millions of key workers who saw us through the pandemic will still be worse off than they were in 2010. That puts vital services under pressure as even more staff leave, and it risks the recovery.  

“He should have announced fair pay deals for whole industries, negotiated with unions, designed to get pay and productivity rising in every sector.

“Families face a triple whammy of a £1,000 universal credit cut, tax hikes and fast-rising energy and food bills. All the while wages across the economy stand still.”

On the universal credit taper cut, she added:

“Workers on universal credit should always have been able to keep more of their wages. This change does not make up for the £1,000 per year cut to universal credit, and does not help those on universal credit who cannot work.”

Centre for Cities’ Chief Executive Andrew Carter said: “Raising the National Living Wage is a quick win for the levelling up agenda and will have the biggest impact in the places that are crucial to the Prime Minister winning the next election. Four of the five places where the most people will benefit are in the North.

“While a pay increase is good news for people struggling with the cost of living crisis, it does not address the reasons why they live on low pay in the first place: a lack of well-paid jobs in their local area.

“We’ve seen today the beginnings of a plan focused on skills, innovation and infrastructure to address this, but turning it from rhetoric to reality will depend on ministers’ willingness to work with metro mayors and councils on delivering it.

“I am now looking to the delayed Levelling Up White Paper to set out how this will happen.”

Katie Schmuecker, Deputy Director of Policy & Partnerships at JRF said: “This is a tale of two Budgets for families on low incomes. 

“For those in work, the change to the taper rate and work allowance, alongside the National Living Wage increase, are very positive steps, allowing low-paid workers to keep more of what they earn. Together these measures improve our social security system for working families and demonstrate a serious intent to turn the tide on the pre-pandemic trend of rising in-work poverty.  

“But the reality is that millions of people who are unable to work or looking for work will not benefit from these changes. The Chancellor’s decision to ignore them today as the cost of living rises risks deepening poverty among this group, who now have the lowest main rate of out-of-work support in real terms since around 1990. 

“Among the people in our society who cannot work are cancer patients, people with disabilities and those caring for young children or elderly parents. 

“Their energy bills and weekly shop are going up like everyone else’s and they face immediate hardship, hunger and debt in the months ahead. The Chancellor had an opportunity to support families on the lowest incomes to weather the storm ahead, and he did not take it.” 

New analysis by the independent Joseph Rowntree Foundation reveals that the rising cost of living wipes out much of the financial gain some families will receive from the Universal Credit changes announced today.

Weekly incomes and Costs for 2022/23Family 1: single adult, no children, not workingFamily 2: single parent, with one young child (assume age 5), part-time 16 hours per weekFamily 3: couple with two young children (assume 7 and 5). One FT workerFamily 4: single parent, with one young child (assume age 5), full-time 35 hours per weekFamily 5: Couple with two young children (assume 7 and 5). 1 FT worker (35 hours), 1 PT worker (16 hours)
Weekly income before new announcements£77£278£433£333£489
Weekly gain from taper rate and work allowance£0£8£19£19£31
      
Total loss from higher cost of living due to…-£13-£16-£23-£18-£24
1) increase in energy prices-£7-£7-£7-£7-£7
2) overall cost of living increase-£6-£8-£13-£8-£13
3) increase in National Insurance and impact of inflation on earnings£0-£1-£3-£3-£4
      
Overall weekly gain or loss after measures and cost of living-£13-£8-£4£1£7

Note all five families lost £20-a-week in October 2021, due to the cut in the Universal Credit Standard Allowance, so all are worse-off than they would have been in September 2021. All workers are assumed to be paid at the National Living Wage rate, so benefit from its increase.

Peter Kelly,Director of the Poverty Alliance, said: “It is a shameful, unjust decision that makes the Chancellor’s rhetoric about ‘levelling up’ seem as empty as the pockets of the hundreds of thousands of people swept into poverty as a result.”

New Centre for Cities high streets recovery data published

Centre for Cities has published the latest update to its High Streets Recovery Tracker, covering September 2021. We have data for the 63 largest cities and towns in the UK.

The tracker can be found here.

Here are some embargoed topline trends from this month’s update:

Changes in footfall in September

  • Overall footfall continued to rise in the centres of the 63 largest cities and towns in the UK in September, the average rise was 8 percentage points.
  • The biggest increases in footfall were seen in Sheffield, Nottingham and Chatham.
  • However, ten large city and town centres recorded falls in footfall. The three places recording the largest drops in footfall were seaside resorts: Blackpool, Bournemouth and Southend.
  • Overall weekday footfall – an indicator of workers back in the office – rose from 60% of pre-pandemic levels at the end of August to 67% by the end of September – a 7 percentage point increase.
Cities with the largest increase in footfall in September
RankCityChange in footfall (percentage point)Overall footfall level as of the last week of September (percentage of pre-pandemic average)
1Sheffield3389
2Nottingham3288
3Chatham26101
4Huddersfield2086
5Bristol2081
Cities with the decrease in footfall in September
RankCityChange in footfall (percentage point)Overall footfall level as of the last week of September (percentage of pre-pandemic average)
1Blackpool-37123
2Bournemouth-2994
3Southend-2697
4Reading-2372
5Edinburgh-1480

Footfall as of the end of September

  • Overall, footfall had returned to pre-pandemic levels in six of the 63 large cities and town centres studied by the end of September: Blackpool, Swansea, Burnley, Chatham, Sunderland and Dundee.
  • Overall footfall remains lowest in London, at 49% of pre-pandemic levels it is now the only large city or town in the country where city centre footfall is not yet at half of pre-Covid levels. It’s weekday footfall – an indicator of workers back in the office – also remains the lowest in the UK, at 44% of pre-pandemic levels.
  • On average, weekday footfall at the end of September was 67% of pre-pandemic levels, with two places – Burnley and Chatham – back to pre-pandemic weekday footfall levels.
Cities with the highest overall footfall as of the end of September
RankCityOverall footfall level as of the last week of September (percentage of pre-pandemic average)
1Blackpool123
2Swansea104
3Burnley104
4Chatham101
5Sunderland100
Cities with the lowest overall footfall as of the end of September
RankCityOverall footfall level as of the last week of September (percentage of pre-pandemic average)
1London49
2Milton Keynes66
3Oxford67
4Luton68
5Slough69

Centre for Cities: Recovery gathers pace as UK emerges from Covid-19 pandemic restrictions

Centre for Cities has published the latest data on its High Streets Recovery Tracker, up to the end of August.

The data suggests that footfall in all of the UK’s largest cities and towns is now recovering as the UK emerges from pandemic restrictions.

Some key findings from the latest data:

  • By the end of August, average footfall in the centre of the UK’s largest cities and towns reached 64% of pre-Covid levels – up from 53% at the end of July.
  • Footfall was highest in seaside resorts and other tourist destinations. It exceeded pre-Covid levels in Blackpool, Bournemouth and Southend and came close in Brighton, York and Edinburgh.
  • Reading saw a 41 percentage point increase in footfall between the end of July and the end of August – the biggest increase in the country. This is likely to do be due to Reading Festival.
  • The increase in footfall that places saw in August was driven by evening and weekend leisure visitors rather than workers. Worker footfall remained low throughout the summer
  • Overall footfall in central London and the centres of other large cities also remained low throughout the summer – both compared to other cities and compared to pre-pandemic. In central London overall footfall at the end of August was just 43% of pre-pandemic levels. On the weekend it was higher, at 67%, but still trailing smaller cities.
Where did city centre footfall increase the most in August?
Increased the mostIncreased the least
RankCityAugust footfall increase (percentage point)Last week of August footfall level (% of pre-Covid)RankCityAugust footfall increaseLast week of August footfall level (% of pre-Covid)
1Reading41951Mansfield177
2Blackpool401602Portsmouth268
3Southend301233Sheffield357
4Edinburgh27944Northampton364
5Bournemouth241235Slough362

You can explore the all the data for the 63 largest cities and towns on our interactive tracker.

Centre for Cities publishes footfall and spending data on a monthly basis. The next release will be published in mid-October and cover the full month of September.

Latest Centre for Cities’ data shows the high street’s recovery may be stuttering

  • Visitor footfall to city and town centres across the UK drops in June after initial surge– with tourist hubs worse hit
  • Weekend visitors to Blackpool and Bournemouth almost halve in June
  • Big city centres continue to struggle with London seeing the weakest recovery of all centres

New data from Centre for Cities’ High Streets Recovery Tracker shows that the recovery of high streets stuttered in June as footfall fell back across the UK – raising concerns about the UK economy’s bounce-back from Covid restrictions.

Seaside and tourist destinations saw the sharpest drops in visitor numbers between the end of May and end of June, with visitors to central Blackpool and Bournemouth falling by by almost half.

Meanwhile, weekend visitors to other tourist destinations such as Brighton, York and Edinburgh also fell steeply.

Overall weekly footfall numbers fell by the end of June in 62 of the 63 city and town centres studied. On average, overall footfall in large city and town centres fell by seven percentage points.

City or large town(selected seaside and tourist destinations)Weekend footfall Fall in footfall from last weekend of May to last weekend of June (percentage point)Weekly footfallOverall fall in footfall from end of May to end of June (percentage point) 
Blackpool-45-18
Bournemouth-45-15
Brighton-39-16
Southend-36-12
York-28-14
Portsmouth-25-12
Oxford-23-10

Pubs, bars and restaurants are also likely to have taken an economic hit as night-time visitors to city and town centres fell by six percentage points between the last weekend of May and last weekend of June.

Despite the fall, small and medium city and town centres continue to have seen the strongest recovery overall since restrictions were lifted, while bigger cities continue to struggle.

Southend, Blackpool and Basildon have come back strongest, with footfall being more than 70 per cent of February 2020 levels but London and other large city centres lag a long way behind – footfall in the centre of the capital was at just under a third of February 2020 levels.

RankCity or large townOverall footfall recovery in last week of June (February 2020 = 100)
Top 10
1Southend81
2Blackpool77
3Basildon72
4Chatham72
5Burnley72
6Aldershot71
7Mansfield69
8Gloucester68
9Wigan68
10Barnsley67
Bottom 10
54Milton Keynes50
55Liverpool50
56Nottingham49
57Aberdeen48
58Cardiff46
59Leeds46
60Glasgow43
61Manchester41
62Birmingham41
63London33

Centre for Cities’ Chief Executive Andrew Carter said: “Much discussion in the lead up to restrictions being lifted was about the amount of pent up demand that lockdowns had created, and the likely splurge in spending as a result. But while there was an initial jump, the data suggests this may have faltered.

“The weather and growing Covid-19 cases may be reasons for this, but with the end of the furlough scheme is in sight, high street businesses and workers will be hoping that the removal of restrictions on 19th July will help to sustain the high street’s recovery and bring more people back to the centre of our cities.”

Government urged to reform the planning system to reach net zero

Centre for Cities: Planning and transport changes in cities would bring UK 26% closer to its target

  • Make it easier to build energy efficient low-rise flats and terraces in city centres and suburbs
  • Improve public transport and charge polluting drivers to halve urban car emissions
  • Encourage people to ditch their cars post-pandemic

The Government needs to press ahead with planning reform to meet its net zero target according to Centre for Cities’ research in partnership with HSBC UK.

Its campaign should begin in cities which, despite being big carbon emitters, have the best chance of leading the UK to net zero. The report finds that the right policies targeted in cities will being the UK a quarter of the way closer achieving a carbon neutral future.

Doing this this will require the Government to progress its planned reforms as the current system is a barrier to reaching net zero. They encourage housing development in isolated areas over better-connected inner-city and suburban brownfield sites.

Houses emit more carbon than flats, but they accounted for nearly eight in ten homes built in 2019 – an increase of 12 percentage points since 2013. Therefore, providing a more balanced mix of low-rise flats and terraced houses close to city centres would therefore help the UK reach net zero.

Building new homes centrally would also reduce car dependency. If the share of journeys made by public transport rose from one third to two thirds then urban carbon emissions would halve. Therefore, providing good public transport in all cities is essential to reaching net zero.

The number of people using public transport fell sharply during the pandemic and has not yet reached pre-Covid levels. Reaching net zero will be impossible while so many people continue to shun public transport in favour of cars. Policy makers therefore must encourage the public back onto public transport.

They should also introduce charges to disincentivise non-electric car usage and improve the public transport system in all cities. Doing these together could reduce total urban transport emissions by 87% by 2035.

The report argues that, to help cities reach net zero, the Government should:

  • Make it easier to build new energy efficient homes in city centres and suburbs.
  • Reintroduce the £2 billion Green Homes Scheme to retrofit existing homes. This would reduce carbon emissions by around 30% across England and Wales’ largest cities and towns.

And local government leaders should:

  • Improve public transport by bringing buses under public management
  • Introduce Clean Air Zones that charge drivers of the most polluting vehicles.
  • Encourage walking, cycling and public transport usage.

Centre for Cities’ Chief Executive Andrew Carter said: “The majority of people in the UK are based in our cities and largest towns. This means that changing the way that we live, work and move around them will be essential if we’re to reach net zero by 2050.

“Because 64% of the UK’s total carbon emissions come from homes and transport, it will be impossible to reach net zero without changes to our planning and transport systems. If the Government does these together it will help it reach its goals of becoming carbon neutral and levelling up.”

Ian Stuart, CEO of HSBC UK said: “This report shows the key role Britain’s town and cities, and decision-makers leading them, are going to play in helping the UK reach its net-zero ambitions.

“Consumers, businesses and local communities will need support from both central and local government if we’re going to make the big lifestyle changes needed over the coming years in the way we travel and in the way we build and heat our homes.

“There is a real opportunity to build a partnership between the public and private sectors to create the new solutions to meet the climate challenge and to open up new green opportunities for growth for small and medium sized businesses right across the country.  HSBC UK stand ready to play our part in this partnership.” 

Vaccine boost for the high street as consumer spending increases – but many big cities lag behind

Vaccine boost for the high street as consumer spending increases across the country – but many big cities continue to lag behind

  • Consumer spending highest in North and Midlands after restrictions eased last month
  • But shops, restaurants and pubs in London and other big cities continue to struggle
  • Government and newly elected metro mayors need a plan to bring visitors back to city centres

April’s lifting of lockdown restrictions provided a much-needed boost to many high streets as spending surged to pre-pandemic levels in more than half of Britain’s cities and large towns – but cities are continuing to struggle.

New data from Centre for Cities’ High Street Recovery Tracker suggests that spending in Britain’s large towns and smaller cities are recovering faster than in its largest urban centres. Northern England and the Midlands is also so far recovering faster than elsewhere – of the 35 places studied where spending has returned to pre-pandemic levels, 20 are in the North and Midlands.

So far, high street spending has recovered the most in Huddersfield, Basildon and Blackburn, while London, Aldershot, Oxford and Birmongham have seen the weakest recoveries in England so far.

Although spending in Scottish cities is the lowest in the UK in April, retail and hospitality opened on a later date than in England.

Cities where spending levels are highest
RankCityApril 2021 spending (% of pre-lockdown)Difference to week before reopening (percentage points)Difference to summer 2020 reopening (percentage points)
1Huddersfield119%4819
2Basildon117%6532
3Blackburn117%5417
4Birkenhead117%8012
5Mansfield117%7729
Cities where spending levels are lowest
RankCityApril 2021 spending (% of pre-lockdown levels)Difference to week before reopening (percentage points)Difference to summer 2020 reopening (percentage points)
54Newcastle72%6132
55Birmingham65%5628
56Oxford62%4529
57Aldershot56%152
58London53%3426
59Dundee34%-1-4
60Aberdeen24%-10
61Glasgow18%2-12
62Edinburgh12%24

While high street spending in many larger cities remains below pre-lockdown levels, it is now significantly higher than it was this time last year – suggesting that consumer confidence is returning as more and more people are vaccinated and the pandemic ends.

Despite these positive signs, the Government and England’s newly elected metro mayors must set out plans to encourage people to return to the centres of our largest cities. Without the return of visitors, tourists and office workers thousands of jobs in shops, restaurants, pubs and other city centre services remain under threat.

Centre for Cities’ Chief Executive Andrew Carter said: “We can already see that the vaccination programme and lifting of lockdown is helping businesses get back on their feet. Many cities and towns, particularly those in Northern England and the Midlands, have seen a boom in consumer spending in the past month.

“It’s not all good news, the centres of our biggest cities such as London, Birmingham and Manchester remain quiet as people there continue to work from home. If this doesn’t change in the next few months I’d expect to see more people working in retail and hospitality in our biggest city centres lose their jobs. The Government must work with the newly-elected metro mayors to stop this happening.”

North and Midlands leads UK’s jobs recovery

  • Nine out of 63 cities and large towns have recovered to their pre-pandemic level of job postings, with the North and Midlands outperforming the South and South East
  • Barnsley, Mansfield and Stoke recorded strongest job posting recovery to date; Aberdeen, Belfast and Crawley experienced the weakest
  • Areas with high claimant counts and slow recovery in job opportunities in greatest need of policy support, according to new research by global job site Indeed and the Centre for Cities 

Britain’s resurgent jobs market is being led by cities and towns in the North and Midlands, according to new research by global job site Indeed and the Centre for Cities think tank.

Hiring gathered pace after the UK Government’s reopening roadmap was announced on 22 February but new analysis shows job growth is unevenly spread across the country.

Indeed and the Centre for Cities analysed job vacancies in 63 cities and large towns and found that in some parts of the country job postings now exceed their pre-pandemic level with those in the North and Midlands having so far witnessed the strongest recovery in job postings.

In total, nine cities or towns – led byBarnsley (+21%), Mansfield (20%) and Stoke (17%) – now have more job postings than before the pandemic started.

In contrast, Aberdeen (-53%), Belfast (-39%) and Crawley (-39%) are the three places where job postings have recovered the least, together with other cities and large towns predominantly in the South East of England.

London too is among the places with the slowest recovery: job postings in the capital are still 26% below their level before the pandemic, making it the 11th city with the slowest recovery.

Pace of job posting recovery varies

Indeed.png

The improving jobs landscape in the North and Midlands is partly driven by the mix of available jobs.

Recoveries have been strongest in areas with a greater pre-pandemic share of postings in occupations related to the production and distribution of goods, such as manufacturing, driving and loading & stocking, as well as essential services like healthcare, social care and education.

On the other hand, places with a higher share of pre-pandemic job opportunities in food & beverage service and hospitality & tourism are lagging behind.

Production and distribution hubs lead job postings recovery

Indeed 2.png

New analysis of claimant counts and job vacancies points to which jobs markets were hardest hit by Covid-19 and might take longest to return to their February 2020 level.

Places with high claimant count and low job postings include Brighton, Crawley, Slough as well as London in the south and Blackpool and Manchester in the north. These cities and large towns — which have a dependency on tourism and bustling workplaces — are the hardest hit by the pandemic as recruitment activity is lagging and more people are looking for jobs.

In contrast, places with low claimant count rates and whose job postings have mostly recovered to their pre-pandemic level – such as Mansfield, Swansea and Warrington – appeared to have been relatively sheltered from the economic impact of Covid-19.

Pawel Adrjan, head of EMEA research at the global job site Indeed, comments: “As hiring activity picks up across the country it’s clear there is a two-step jobs recovery underway in Britain.

“Cities and towns in the North and Midlands that have been buoyed by rising manufacturing, distribution, healthcare and education jobs but at the same time areas reliant on hospitality, tourism and higher paying jobs that can be performed from home have seen only sluggish growth.

“Just nine urban areas out of 63 have back above their pre-pandemic level and while the partial reopening of the economy earlier this month rode to the rescue of many businesses and workers our research shows that it alone was not enough to lift ailing area’s jobs levels significantly.

“We’ve seen how quickly the jobs market reacts to policy and public health announcements and policy makers will hope the eventual unwinding of Covid-19 restrictions will help level up the jobs recovery.”

Elena Magrini, senior analyst at the Centre for Cities, said: “Not everywhere is seeing yet the beginnings of post-pandemic recovery. Places reliant on tourism, aviation and office workers have been particularly hard hit and still have high shares of people who are unemployed or on furlough.

“Despite this, we have reasons to be optimistic, particularly given the pace of the recovery in the North and Midlands. Once we have reopened the economy, policy makers need to focus on building back better – growing the economy by creating better paid, higher skilled jobs for people right across the country.”

Full scale of Britain’s job crisis uncovered in new research

Seven new private sector jobs will be needed to create one viable job post-pandemic

  • Cities will lead economic bounce back but most new jobs are expected to be low-skilled and low-paid.
  • Government must upskill workers and encourage higher-skilled businesses to invest in cities – particularly in the North and Midlands.

New Centre for Cities’ research in partnership with HSBC UK reveals that Britain’s jobs crisis is bigger than realised as the economy will need to create almost ten million new private sector jobs just to reverse the damage done by the pandemic.

Analysis of Britain’s ‘jobs miracle’ from 2013 to 2019 – when the national economy created 2.7 million net new jobs – finds that 19.3 million private sector jobs were created during this period and 16.6 million were lost. This meant that seven new private sector jobs were needed to create one viable job.

If this pattern repeats post-Covid then 9.4 million new private sector jobs will be needed to get the 1.3 million people who lost their jobs during the pandemic working again.

After the financial crisis big cities created the vast majority of new jobs and are expected to do so again post-Covid. London created one in four of all new private sector jobs (790,300) – equal to 17 Scarboroughs, or 25 Hartlepools. Other big cities also played an outsized role: in Manchester, 152,100 new jobs were created; in Birmingham 99,100 were; and in Glasgow 40,800 were.

In total, Britain’s ten largest cities created almost half (45.6%) of jobs during the ‘jobs miracle’, despite accounting for just 3.5% of land. In contrast, smaller towns and rural areas created 36% of new jobs. These findings underline the important role that big cities will play in helping the country recover from Covid-19.

Contribution of cities and non-urban areas to job creation, 2013-19

Fig 1.png

Source: ONS, Business Structure Database (BSD)

Many of the jobs lost in the pandemic were in sectors such as hospitality and tourism. While they are expected to recover quickly once the economy reopens, with an estimated three quarters of new jobs likely to come from sectors such as these, relying on them for new jobs will not address years of poor productivity and pay stagnation, particularly outside London and the Greater South East.

After the pandemic, the productivity problem that UK cities face will need to be addressed.

To do this the Government should invest in adult education to train people for higher-paid jobs in emerging industries. It should also recognise the crucial role that cities will play in building back better from the pandemic. It should invest £5 billion in a new City Centre Productivity Fund to make struggling city centres more attractive places for high-skilled businesses to locate.

The paper’s other proposals to help the country build back better from the pandemic include reforming business rates, which in their current form are a tax on business investment, and devolving more economic powers and resources to local government – particularly England’s metro mayors.

Centre for Cities’ Chief Executive Andrew Carter said: “Britain’s biggest cities will play a central role in our recovery from the pandemic, as they did after the last economic crisis when London alone created a quarter of all new jobs.

“We must use Covid-19 as an economic reset and address many of the long-standing problems that the economy has faced in recent years such as stalled productivity and stagnant pay. To do this the Government will need to focus on investing in adult education to train people for higher paid jobs.

“Addressing these problems will be be essential if the Government hopes to attract higher-skilled businesses in emerging industries to cities and large towns in the North and Midlands and meet its levelling up objectives.

Ian Stuart, CEO, HSBC UK said: “The employment challenge ahead for the country’s economy cannot be underestimated.

“Beyond the sheer volume of new jobs required, the UK will need to create high value, export-led employment across all regions, if it is to address the age-old productivity puzzle.

“Coming out of the Covid-19 pandemic, we will only truly succeed in levelling up the country if the challenge is shared between government and the private sector with a focus on reskilling our people and attracting new business growth and international investment in the sectors where we have a real competitive advantage.”

Covid-19 makes improving Scotland’s economy almost four times harder

 Dundee faces the biggest challenge in Scotland

  • Glasgow also faces a big challenge.
  • Better adult education, transport investment and improvements to Scotland’s urban centres needed.

Covid-19’s economic damage makes the task of improving Scotland’s economy and spreading prosperity almost four times harder according to Centre for Cities’ annual study of the UK’s major urban areas – Cities Outlook 2021.

30,900 people in Scotland’s largest cities now need to find secure, well-paid jobs to rebuild and improve the economy – compared to 8,600 last March.

 In Scotland, Dundee faces he biggest challenge, followed closely by Glasgow.

Scottish cities facing the biggest economic challenges post-Covid
RankCityPercentage point reduction in unemployment to rebuild and improve the economy
1Dundee4.1
2Glasgow4.1
3Aberdeen3.4
4Edinburgh3.0
Source: ONS, Claimant count 2020, population estimates 2019.

In addition to hitting some Scottish cities and the rest of the UK as a whole badly, Covid-19 has also hit many previously prosperous places such as Edinburgh, Aberdeen and London disproportionately hard.

The Government must act fast to prevent a levelling down of these places that the whole UK depends on to create jobs and fund public services.

The UK and Scottish Governments should announce how they will use their respective powers to deal with Covid-19’s short-term damage to cities and large towns. The plans should include:

  • Making permanent the £20 rise in Universal Credit.
  • Supporting jobless people to find new good jobs.
  • Consider the merits of a renewed Eat Out to Help Out scheme for hospitality and non-online retailers once it is safe.

Acting to prevent further economic damage by Covid-19 is not the same as levelling up. Once the health crisis ends, the Scottish Government will need to spend additional money on further measures to level up, including:

  • Further education to train jobless people for good roles in emerging industries.
  • Making city centres better places for high-skilled businesses to locate.
  • Improvements to transport infrastructure in city-regions.

Centre for Cities Chief Executive Andrew Carter said:  “Covid-19 has made the task of improving Scotland’s economy and spreading prosperity around its cities and towns much harder.

“Rebuilding and strengthening the economy of Scotland and its cities will not be cheap and will require more than short-term handouts. Government support and investment for new businesses in emerging industries will be essential, as will spending on further education to train people to do the good-quality jobs created.”

Urgent action needed to prevent air pollution rising as Covid restrictions end

  • Air pollution fell in the Spring but now exceeds pre-pandemic levels in 80% of places despite continued lockdown restrictions.
  • Councils must not delay measures to prevent air quality significantly worsening next year.
  • Public transport, cycling and walking should be encouraged over car usage.

Toxic air is set to rise significantly as lockdown restrictions end warns Centre for Cities as it urges councils to press ahead with their stalled pollution reduction plans.

The new analysis shows that, while the spring lockdown reduced NOlevels by 38% on average across 49 cities and large towns, they rose again in the second half of the year as activity increased.

As a result, NOlevels have now hit or exceeded pre-pandemic levels in around 80% of places studied during the second half of 2020. This is despite 98% of the country remaining under significant lockdown restrictions – raising concerns that air quality will significantly worsen once life returns to normal next year.

In some cities such as Barnsley, Bournemouth and Portsmouth, NOlevels in September were already even higher than they were before the spring lockdown.

As the risk from Covid-19 reduces and life returns to normal next year, policy makers must urgently revisit stalled pre-pandemic plans to reduce air pollution – which has been linked to 40,000 UK deaths per year.     

Since March many councils – including Leeds, Bristol, Sheffield – have postponed their pollution reduction plans. This new data makes the case for them look again at implementing air pollution reduction measures.

Data shows that increased post-pandemic home working will not keep air pollution down. It is estimated that more than half of people in London worked from home at the peak of the pandemic, yet NOlevels in the capital have returned to near pre-March levels. This is because commuting is not biggest cause of pollution and remote workers are more likely to use their car for leisure purposes.

Private vehicle usage is the main generator of toxic air: pollution has increased since May in line with the return of private cars to the road. Meanwhile, public transport usage has remained low. Because of this, mayors and council leaders must press ahead with plans to reduce private vehicle-related emissions.

They should:

  • Discourage car usage by introducing clean air zones that charge drivers
  • Encourage more public transport usage through improvements to bus, rail and tram systems
  • Improve cycling and walking infrastructure to encourage more active forms of travel

Centre for Cities’ Chief Executive Andrew Carter said: “Toxic air has contributed to the deaths of thousands of Covid-19 victims this year and, even after the pandemic ends, will remain a big threat to health – particularly for those living in urban areas.

“City leaders can reduce threat of air pollution, but it will take political will. Discouraging car usage will be unpopular in the short-term but, if coupled with the necessary improvements to public transport, the long-term benefits to public health and the economy will be huge and our cities will become better places to live. Now is not the time for politicians to delay on this.”

The Centre for Research on Energy and Clean Air’s Data Lead Hubert Thieriot said: “With the Covid-19 pandemic came immense suffering both on sanitary and social fronts. Incidentally but importantly, it also reminded citizens that air pollution is not a given, and that bold actions on transportation could significantly improve people’s health and quality of life.

“The role of transportation in UK cities’ air pollution has become apparent to everyone during the COVID-related lockdowns. That shared awareness offers policy makers an historical chance to implement bold transportation policies, as many other cities overseas have shown.”