Supporting Local Economic Growth

As the Secretariat for the APPG for Entrepreneurship, The Entrepreneurs Network is hosting a series of webinars to bring Parliamentarians and leading business owners together to explore what the future holds for start-ups and scale-ups post-COVID-19. 

In our latest APPG for Entrepreneurship session on Supporting Local Economic Growth, we heard from an expert panel of speakers about what is being done in the face of COVID-19 to support local economic growth and what can be done to ensure an entrepreneur-led recovery across the UK.

We heard from Gagan Mohindra, Conservative MP for South West Hertfordshire. We also heard from Chairman of the Hertfordshire LEP and the LEP Network, Mark Bretton, and Head of Data at ODILeeds, Co-founder of TheDataCity.com and Founder of imactive, Tom Forth. 

Here are some of the most thought-provoking insights from the session. You can view this on our YouTube channel. 

Highlights & Insights from our Speakers

In his opening remarks, Gagan Mohindra MP welcomed Rishi Sunak’s recent statement, highlighting the announced reduction in VAT for the hospitality sector. He suggested that policy makers play an important role in creating an environment that allows businesses to flourish:

“The most important thing that I, as a politician can be judged on is the impact that I can make through policy within your life.”

Mark Bretton then spoke about the LEP Network and the feedback they have provided to Government during the COVID-19 pandemic to support local business:

“We have been very careful to give constructive, but important feedback on all the interventions that have been made to ensure that they are relevant. Where there have been gaps in schemes that we believe we can find a resolution to fill, we have been doing that.”

He also addressed the interventions that have been put in place by the LEP Network at the local level to support economic growth:

“Every LEP has put together three or four different schemes during the crisis, so over 100 schemes around the country, to make focused interventions to help our businesses.” 

Tom Forth mentioned his research and the gap that he has observed between performance in the North and South of the UK: 

“The UK’s GDP per capita is the lowest in Northern Europe… but that is not uniformly a low performance. The South East of England is one of the most productive and prosperous regions in Europe. The North of England and the Midlands are among the weakest economies.”

He suggested that the root of the UK’s problem with local economic growth is that government decisions are centralised and predominantly London focused. He also spoke about some of the positives of having a centralised government:

“We are culturally entrepreneurial… that is due to things that support local entrepreneurial activity and growth including a fair legal system, good press, the English language, easy company law, low taxes and low cost of employment”

He finished with some recommendations to drive local economic growth in the UK: 

“I think the uneven access to infrastructure, to state research and development funding, and to government support is a big issue… I think that solving that problem involves having a smaller central government”

Mike Jackson from Tech Nation also joined the panel and introduced some of the projects they are running to support economic growth at the local level:

“The real sea change that we have completed at Tech Nation is moving from a London-centric Tech City model… to what we believe is a reflection of the UK tech ecosystem.”

He addressed some of the challenges that Tech Nation have observed in local areas and their plans to work with local ecosystems to share best practice across the UK:

“We do think that national institutions still have a role in democratising access to scarce resources and sharing best practice.”

Questions & Recommendations

 During the Q&A session, we touched on a range of key issues. 

One attendee asked whether MPs could use LEP Networks to support local businesses in their area?

In response, Gagan suggested that although MPs do not ordinarily get involved within LEP Networks, the correct model could be to move funding closer to local businesses that need it:

“From my experience of local government, politicians can do so much, but we need entrepreneurs, business people and specialists in other fields, like the third sector to take on the mantle and drive it forward.”

Mark argued that there should not be a diversion of effort but rather a rebalancing to ensure that the leveling up agenda is carried forward across the UK.

Another attendee mentioned the Shared Prosperity Fund and asked how important this type of policy is in terms of supporting local economic growth?

Mark suggested that the funding is important as the UK leaves the EU and during this pivotal stage, where LEP Networks are collaborating with local government to support local businesses through the COVID-19 pandemic.

Gagan echoed Mark’s thoughts and touched on the challenges that the Government has faced during the pandemic, including it’s evolving funding plans:

“I can’t guarantee that the Treasury has much money left to fork out [to support LEPs]… but I will continue to fight that corner because I know the value of it.”

In response, Tom suggested that we should look to other countries in Europe, like France, that have schemes which have implemented COVID-19 business support schemes at a regional level:

“This idea that we would have good outcomes from collaboration and uniform funding is really quite bizarrely British.”

An attendee asked whether more money should be available and collected at a local level?

Gagan spoke about his drive to push value for money at a local level during his time as finance lead for a large county council. He took the view that there isn’t an easy answer and reinforced the point that policy makers should focus on creating an environment for entrepreneurs to flourish.

Mark responded by echoing Tom’s thoughts that support efforts should be localised and that clear interventions should be made locally.

One attendee asked how LEPs could be evaluated, specifically whether there were incentives for good LEPs to expand and bad LEPs to change or withdraw and what data LEPs or Local Government should be publishing to make these evaluations easier?

Tom addressed some of the challenges that the LEP face with publishing their data.

Mark added that LEPs are assessed by Whitehall annually on metrics including governance, delivery and their strategic plan. He suggested that LEP objectives should be better aligned with business objectives going forward and best practice sharing should be encouraged:

“I think that what is going to come out of this is a much clearer set of metrics which we use to measure LEPs.”

We will have more APPG for Entrepreneurship webinars coming up after recess. If you are interested in finding out about these, you can sign up here.