The prime minister chaired the first meeting of her industrial strategy committee on Tuesday afternoon, having already caused waves with an abrupt decision to review plans for an £18bn nuclear plant at Hinkley Point.
The committee, comprising the prime minister and 11 secretaries of state, is charged with building an economy that works for “everyone, not just the privileged few”.
Her reluctance to endorse the Northern Powerhouse explicitly had led to speculation that she might discard a central part of Mr Osborne’s legacy. However, in a sign of continuity, Neil O’Brien, a former special adviser on devolution to Mr Osborne, is to join the Number 10 policy unit to lead its work on industrial strategy.
In the meeting, Greg Clark, the business secretary, said that the government should “do more to support cities outside London” — in effect a rebuke to the concept of a Northern Powerhouse centred around Manchester.
Philip Hammond, the chancellor, told ministers that halving the productivity gap between London and the south-east and the rest of the UK would increase gross domestic product by 9 per cent.
Productivity in the UK has stagnated since the financial crisis, with declines in areas such as the north-west, south-west and Northern Ireland.