By David Ralph, Chief Executive of the Heart of the South West LEP.
We are all aware that times are challenging right now. Business confidence is not great, and although it seems we will avoid a technical recession, the economy is flatlining at best and the Government has little wriggle room to unleash significant impetus to promote growth, specifically clean and inclusive growth.
To drive up productivity, and therefore prosperity, we need Government to be taking strong action on four things:
- Improving the skills of our workforce and getting the economically inactive back to work
- Further improvements to our road, rail, digital and energy infrastructure, including accelerating improvements to the grid
- Continuing business support, particularly for our area’s startups, where we lag, but also reducing the costs of doing business
- Increasing innovation in our world-leading science strengths
All of these are indeed mentioned in the Budget; there is progress on nuclear delivery and a reset of the green agenda, which was overdue, as well as some reference to clusters, which are becoming increasingly important. The package to encourage people back into work, including support with childcare, is welcome, though the OBR notes that the impact is relatively low, with somewhere between 55,000 and 240,000 people likely to be encouraged back. Incentives to encourage investment in businesses are again a positive move.
However, whilst there are upsides in the Budget, it looks like much of the specific support is passing the South West by. Of the £400m set out for prospective levelling up partnerships, only two – Torbay and Torridge – are in our area. The £200m regeneration fund is targeted entirely at the Midlands and the North, and the £200m carbon capture programme again does not touch the South West, despite the fantastic opportunity presented by our natural capital.
We are keen to develop Investment Zones, connected to our universities in Plymouth and Exeter and the Gravity site in Somerset, but these also are focusing on the North and the Midlands. We are also looking to maximise connectivity, but there seems to be little money available to improve the highway and rail network, simply maintain it. Project Gigabit hasn’t even reached this part of the country yet, and rather than a comprehensive workforce plan to deliver the skills needed to drive the economy forward further and faster, including a more flexible apprenticeship levy, we are seeing, at best, tinkering around the edges.
With a general election in the not too distant future, it seems that red wall voters have been targeted in this Budget, with the South West left somewhat at the margins. The Budget fails to recognise the strong social mobility and levelling up challenges facing our area, as well as passing by our real opportunities such as floating offshore wind, and our key cluster around climate change science, clean mobility, marine, high value engineering and photonics.
The Budget feels like a missed opportunity for our area. Yet again, this underlines the continued need for a strong, clear message about the challenges the South West faces, and the unique opportunities we can bring to the country.
