Cities in North doomed, says favourite Tory think-tank

Struggling northern cities will never be able to regenerate and should be given up, a Tory think-tank with close links to David Cameron concludes today.

Residents of cities such as Liverpool, Bradford and Sunderland should be encouraged to move to the more prosperous South-east, it says. A future government should build three million homes in and around London, Cambridge and Oxford to prompt Britain's biggest mass internal migration since the 19th century.

The call from Policy Exchange will be a huge embarrassment to the Tory leader as he heads to north-west England today to campaign in marginal seats. Policy Exchange was founded by Michael Gove, the Tory education spokesman. Its policy director is Anthony Browne who is about to begin working for Boris Johnson and is tipped for a role at No 10 if the Tories win the next election.

In a statement last night, the Conservatives said the report did not reflect party policy, adding that they wholeheartedly supported the regeneration of northern cities.

In its report, the think-tank said: "We need to accept above all that we cannot guarantee to regenerate every town and every city in Britain that has fallen behind. Just as we can't buck the market, so we can't buck economic geography either."

Policy Exchange said many large coastal cities had lost their raison d'etre with the decline of shipping and raised the alarm over the future of Liverpool, Sunderland, Hull, Scunthorpe and Blackpool. It said it was unrealistic to expect the prosperous cities of Manchester, Leeds and Newcastle to regenerate less well-off neighbours such as Liverpool, Rochdale, Bradford and Sunderland. It said such places were not "doomed" and could not be abandoned, but people had to face up to the fact that they had "little prospect of offering their residents the standard of living to which they aspire". The think-tank said all three million new homes earmarked for England by 2020 should be built in the South-east, making it easier for people in less well-off areas to move. It also called for massive building in Oxford and Cambridge, taking advantage of their high skills base and favourable location.

Tim Leunig, a co-author of the report, said: "No doubt some people will claim these proposals are unworkable, unreasonable and perhaps plain barmy. But the issue is clear: current regeneration policies are failing the very people they are supposed to be helping and there is no evidence that the trend will be reversed without radical changes. Internal migration has always been an important part of a dynamic economy."

A spokesman for the Department of Communities and Local Government said it totally disagreed with its conclusions.

Warren Bradley, leader of Liverpool City Council, said: "The past decade has seen unprecedented growth in Liverpool's economy, which has surpassed many southern towns and cities."

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