Businesses to create 'levelling up' centre

A 'Centre for Thriving Regions' is to be established by the UK's leading business organisation in a bid to end economic inequalities between different parts of the nation.

CBI

David Sapsted

22 November 2021

Tony Danker, Director-General of the Confederation of British Industry (CBI), unveiled the plan in his speech at the opening on Monday of the organisation's three-day annual conference in South Shields in NE England.

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Lifting productivity

Mr Danker said the Government's "levelling up" agenda, aimed at improving the fortunes of regions outside the affluent South, could only be achieved by ministers and business leaders working together.The CBI has identified four elements that are required to lift the productivity needed to allow more areas to prosper: high-value sectors, high-value firms, high-value skills and higher business investment.Mr Danker said the current problems stemmed from the fact that, since the 1980s, the regions suffered from de-industrialisation as old industries were allowed to die due to an economic policy "that was ambivalent about levelling down".Young people left regions to chase better-paid jobs in the South while multi-national corporations located overwhelmingly in the thriving South East.

Regeneration and growth

“We’ve spent the past decades living with these consequences. But now, we’ve got a shot at redemption, a chance to regenerate with nascent industries – such as biotech, space, and cybersecurity – emerging in all parts of the country," Mr Danker told delegates.“The 'levelling up' agenda is one we share wholeheartedly with the Government. Billed so far, it’s a lot about politics and public services. City mayors or county mayors. Pride in places and better spaces. It all matters. Business cares about these things. But on those issues the politicians lead.“Ultimately, what the UK needs to level up, however, is economic growth in every place. Growth that in turn provides better paid jobs, skilled work, firm-level success and creates the kind of virtuous circle that helps a place to prosper."

Developing collaborative ecosystems to support growth

Mr Danker said that, for businesses, the answer was the creation of economic clusters where there would be concentrations of firms that not only competed, but collaborated.“It becomes an ecosystem, made up of start-ups and anchor institutions, colleges and universities. Thus, flows skills and expertise in turn generating innovation and ideas. Surprise, surprise – then finance, legal and professional services show up. And soon, adjacent sectors come to town," he said“It’s not a new idea. We know London did it in finance; Aberdeen in oil and gas; Cambridge in science. It’s also enabling South Wales to emerge as a player in the world’s compound semiconductor market, which is projected to grow to over $300 billion by 2030."In the US, it’s cemented Massachusetts’ reputation as a global leader in biotech innovation. And, in Germany, it’s helped Hamburg to become a world-leading civil aviation hub."Mr Danker said that where these clusters worked, it was seldom because of push by the public sector, but because of pull by the private sector.Hence, he added, the CBI's creation of a Centre for Thriving Regions would coordinate the private sector’s commitment to levelling up. "And it will crack one of government’s biggest questions – how to bring private sector leadership to a place. Business people want to play that role."The CBI said the centre would be launching pilot projects to build on the economic cluster model. The organisation would also be writing a "levelling-up playbook" on how to get high-quality industries, firms and jobs in all regions of the UK. A new director would take charge of the centre, which would be staffed from all nations and regions of the UK, and it would have a steering committee of leading local, national and multinational businesses and universities or colleges. It would also draw on the input from the CBI’s 800-strong regional council network.