Northern Powerhouse Update –
Since 2014 the Government has set out plans to accelerate economic growth beyond London and the South East – particularly in the North – and there’s been much debate over how effective this “Northern Powerhouse” initiative will be.
To assess whether the wealth-spreading agenda will work, and what its likely impact will be, leading economic think-tank Cebr and top-20 law firm Irwin Mitchell has released an insightful report founded on strong economic analysis and research.
The study predicts that by 2025 the gap between London and the rest of the UK will actually widen with the Capital’s economy set to grow 27% compared to just half that in the North.
To investigate further, over 1,000 UK businesses were approached for their views on whether or not the Government has taken the necessary steps to address and support economic growth in their region. Findings show a net balance of businesses in the North think not, particularly those from the SME sector. This begs the question of what policies should be implemented.
When asked to choose the one policy they would most like to see support economic growth in their region, improved infrastructure was the most cited with a clear preference for road and local rail investment.
There was also a strong case for devolving a wide range of policies to local level with 59% of businesses in the North agreeing devolution could boost growth in the region.
Frequently cited policies were:
- Increased local decision making that is more in tune with local needs, creating a better environment for businesses in the area.
- The ability to determine business rates which could potentially lead to tax competition within the UK, with areas cutting rates in order to attract more businesses.
- The ability to shape education and skills policy to address the current mismatch between local education and the skills needed by local businesses.
The report concludes by recommending a strong set of policy measures to narrow the regional divide in economic performance, whilst ensuring continued growth in existing powerhouses such as London.
To download a copy click here – UK Powerhouse Report 2015. We hope you find it of interest.