It’s no understatement to say we live in the most extraordinary times. Business leaders have been faced with a succession of crises, starting with the pandemic and now runaway inflation and the cost-of living-crisis.
It’s almost as if VUCA – an acronym for Volatility, Uncertainty, Complexity and Ambiguity - has become the new norm.
Alongside the aforementioned challenges, we’ve had Brexit – an enormous change in how businesses here in the South West trade with our hitherto biggest non-domestic market – and more recently significant political turbulence, declining industrial relations, not to mention an end to peace and stability in Europe.
We now have a new Prime Minister, whose first major task, after her decisive move to allay public concerns over soaring energy bills, was to lead the nation’s mourning after the death of the Queen.
Alongside the new Chancellor, Kwasi Kwarteng, Ms Truss has now also addressed the potentially damaging impact of energy price rises on businesses with the Energy Bill Relief Scheme. This effectively puts a maximum price on the unit costs of electricity and gas charged to businesses, which will be welcome news for many companies in our region, particularly those in manufacturing, leisure and hospitality.
This Friday’s so called ‘mini-budget’, or ‘fiscal event’ as it’s been billed, will also be a key moment for the new administration. While the expected reversal of the planned hikes in Corporation Tax and a possible Income Tax cut are an attempt to shore up both business and consumer confidence, I believe a long-term plan is needed.
Levelling Up was the flagship domestic policy for the Johnson premiership, and if the Truss government is to continue it effectively, I’d like to see a regional industrial strategy created and implemented in partnership with LEPs and the devolved mayoral authorities here.
It’s up to us as business leaders, owners and professionals to make the case for our region. Grant Thornton’s latest Business Outlook Tracker research shows that the majority of mid-sized business leaders in the South West believe that the Levelling Up agenda will help local businesses and their local area, and also see themselves playing an important role in its success.
Local leaders have a responsibility to work constructively with Westminster and to advance a positive vision of economic growth to the new Levelling Up Secretary Simon Clarke and Business Secretary Jacob Rees-Mogg.
If not, I fear the South West may not be as prominent in their thinking as other regions such as the North West and Yorkshire for example – which are already benefitting from north-shoring of civil service jobs from Westminster.
The South West starts from a much poorer position than many other regions. For example, in education this region actually has the largest proportion of workers who claim Universal Credit, at 42% of the working population.
Social mobility is actually worse here too with school attainment gaps between children from more disadvantaged areas among the worse in the UK. The South West also has the lowest proportion of disadvantaged young people going on to university at 17%. Transport is expensive and the region is large, meaning access to job opportunities is less than ideal.
Housing is also an issue given the volume of second homes here, and a big decline in the provision of affordable private rented housing to those who live and work in the region is another sizeable challenge.
With so much to address, it’s clear that a cross-departmental approach is needed to resolve these challenges, which won’t be solved without local insight and buy-in, which is why local leadership, such as the metro mayors, has a key role to play.
Of course, any plan needs committed funding to ensure it delivers both sustainable economic growth and more importantly social mobility, which is at the essence of what Levelling Up is about.
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