Labour MPs know future electoral success is dependent on the material improvement of people’s hometowns. Macroeconomic growth might be how the Treasury measures success, but people’s confidence for the future is closely linked to their experience of where they live. This is what President Biden experienced at a town hall meeting, when a chart showing growth elicited the response: ‘that‘s not my GDP.’
In 1981, Chancellor Geoffrey Howe urged Margaret Thatcher to abandon Liverpool to “managed decline”, but Michael Heseltine knew better: he pushed a comprehensive regeneration strategy. Later, he said: “If you want to have dynamic cities, you have to build comprehensively on their strengths, eradicate their weaknesses, seize their opportunities.” The same could be said for any part of the country.
Yet regional inequality has continued to grow. In the 1980s, London’s productivity was about 125% of the UK national average – now it’s more like 170%. Imagine the impact if we were able to close the gap across our nations and regions, between our towns and our cities.
The case for a ‘place-led’ approach
The reality is that a one-size-fits-all approach still dominates Britain, characterised by centralised taxation, regulation, and funding pot bidding wars. In 2023, Whitehall ludicrously invited councils to bid for £2,500 to install a chess board in a local park.
This has done a huge disservice to coastal areas like the place I represent, which experience unique challenges in comparison to inland neighbours. Historically, national policy has been based on metropolitan assumptions about connectivity, land availability, labour markets, and the ability of growth to “spill over” from cities. In many coastal communities, that spillover never arrives. If wealth is expected to ‘trickle down’ from urban centres, you cannot be further from the font of wealth than if you live at the edges of the country. Thanet has far more in common with Blackpool or Scarborough than it does with Kentish neighbours like Tunbridge Wells.
The statistics speak for themselves. Since the financial crash coastal areas have underperformed national economic growth by 20%. To their credit, the government are increasingly recognising the importance of place in their agenda, but to deliver true transformation we must think bigger.
Picking winners
Policymakers often see coastal economies through the lens of tourism and retirement; as places of consumption rather than production. Somewhere you visit, not somewhere you invest.
Yet coastal Britain contains huge, untapped potential: ports, logistics corridors, energy infrastructure, creative clusters, and a growing digital economy driven by remote working. If these were properly harnessed, coastal areas could be the drivers of economic growth instead of merely the recipients of economic aid. While many of these sectors are in the industrial strategy, the plan is largely place-blind, undermining the potential to deliver for often overlooked places.
Hull has demonstrated how renewable energy can generate thousands of local jobs, while ports are already major employers. In Thanet, the Turner Contemporary has invigorated a thriving creative community and delivered £100 million of economic value over its 15 years of existence. The biggest challenge is ensuring that towns don’t merely host this infrastructure while value is captured elsewhere; instead becoming places where supply chains and skilled employment are anchored.
A special economic zone for the coast
The next step is ensuring industries aren’t bound by national regulations that don’t make local sense. The government should designate the area within 5km of the coast a Special Economic Zone that would allow different rules to be set to support growth sectors.
This is not about a bonanza of off-the-shelf Thatcherite deregulation, which would miss the point that place-led approaches start with the communities they serve. Coastal areas need the ability to coordinate investment, unlock land, trial policy reforms, and build new economic clusters. They must be able to flexibly pilot different approaches, such as localised tax breaks for key industries; coastal hospitality businesses, for example, face a challenging seasonal trading environment not shared with major cities.
Local leaders should also be free to set regulation such as local tourism zones, with a licencing scheme for short-term holiday lets, or different trading hours or rules about outdoor dining. Putting more power in local hands would allow places to figure out what works for them.
Long-term stability, strategy, and investment
But who gets to pick the right economic strategy for an area, and how do we ensure investment follows? Regeneration succeeds when there is a delivery body with the long-term authority and structure to assemble land, coordinate infrastructure, attract investment, and act at scale. Allowing towns within the special economic zone to establish development corporations would enable them to do just this.
Britain has long used development corporations to deliver renewal, from postwar New Towns to the London Docklands. Development corporations create a single point of engagement and a long-term pipeline of projects to invest in, breaking the cycle of a place being seen as an economic loser. They provide a single accountable institution with the remit to deliver change, sitting separately to short-term electoral cycles but still accountable to local leaders and communities.
This is why major investors have urged the Chancellor to relax Treasury constraints on borrowing by development corporations for major projects like the Oxford-Cambridge Arc, arguing this low-risk borrowing wouldn’t spook bond investors. There is no reason why such rules could not be relaxed – within sensible constraints – for smaller development corporations in other parts of the country.
Development corporations could also be implemented within the existing devolution agenda, ensuring local communities in deprived areas remain in the driving seat, and preventing hoarding at the centre of large unitary authorities or mayoralties.
The future of left behind areas
The story of the last thirty years has been of an increasingly unbalanced Britain, but there is no greater mission for a Labour government creating a more equal future. In coastal areas like mine, bold new thinking is needed to break the cycle of frustration and disappointment. If we are ambitious and open to new ideas, we can deliver renewal for some of our most left behind areas.
Polly Billington has been the Labour MP for East Thanet since 2024.