Let me begin by thanking all of you for your investment of time, effort, ideas and resources here today. I want to pay a particular thanks to our star Metro Mayor Richard Parker. Richard has spearheaded an ambitious Local Growth Plan. And he has done much to drive investment and job-creation throughout the West Midlands.
In that sense, we couldn’t have chosen a more fitting place for the first regional investment summit since we published our Modern Industrial Strategy. The West Midlands not only has a deep industrial legacy, but also a dynamic industrial future. It is a cluster of excellence for each and every one of our growth sectors.
Regional investment matters because economic growth matters for the wealth and jobs it creates, for the public services it fuels, for the future prosperity it generates for our nations, regions and communities.
Later today, I will head over to the HS2 construction site at Curzon Street. It looks really impressive from a distance. I can’t wait to see it up close and personal.
The investment HS2 has attracted to the West Midlands will add £10 billion to the regional economy over the next ten years, create 40,000 new homes and more than 30,000 new jobs. HS2 demonstrates the huge economic growth potential of infrastructure investment.
I want to focus today on the vital importance of economic growth.
Since the 2008 financial crisis, Western economies have shared a problem of low growth. An aging population, productivity stagnation, and global trading tensions all contribute to the West’s sluggish economic growth.
In the years before the financial crisis, the USA and Europe achieved growth rates of between 2 and 3%. Today, average annual growth in many advanced economies is lower than for decades, with “lower for longer” structural growth rates.
In the UK, had we maintained our pre-2008 trend growth rate, and nothing else had changed – no financial crisis, no pandemic, no Brexit – we would have 21% higher GDP by now, £240bn more in revenue each year to spend on public services, and people’s average wages would be £7,000 a year higher.
To those who dismiss the importance of higher economic growth to every family in this country, I simply say economic growth is the route to stronger community cohesion, greater personal prosperity, public service improvement, and securing Britain’s national renewal.
Fifteen months ago, we inherited a national growth emergency in Britain. Since then, we’ve stabilised the economy, secured billions of pounds of investment in Britain, reached new trade agreements with Europe, the USA and India, and taken the tough decisions to turn our country around.
But, candidly, our low-growth inheritance requires a national response matching the urgency, scale, and significance of Britain’s continuing economic growth challenge.
Without that, Britain’s growth will continue to be too low, too slow and too regionally imbalanced.
Our economy will still punch below its weight.
Our national prosperity will remain below trend.
Our regional development will continue to lag behind where it needs to be.
And, our people will be less well-off than they should be.
The breadth and depth of the national growth emergency we inherited, and its continuing impact on our economy, means we must not resile from an emergency response mindset until we have realised our number one mission greater economic growth for Britain.
That demands a dedicated nationwide effort to buck the trend, back British business, and get Britain growing again.
It requires a single-minded determination to make Britain the best place to start a business, grow a business, run a successful business and work in a thriving business, anywhere in Europe.
When Jaguar Land Rover were attacked online, we didn’t sit back and just hope things would improve. We stepped-up and stepped-in with support, including a £1.5 billion financing guarantee through UK Export Finance. The speed and scale of that intervention proves we will not hesitate to act decisively in the national interest. And shows that when we focus our efforts on sorting out a problem, Britain can do it.
The national growth emergency we inherited demands we act with the same determination, the same urgency, the same laser-like focus, to promote growth within the British economy as we did to prevent the collapse within the JLR supply chain.
Because only better economic growth can deliver the opportunity, security and prosperity the British people demand.
And only business, investment, and innovation can drive economic growth. Economic stability, low inflation, and responsible fiscal policies are necessary, but insufficient alone to create the conditions for that to happen.
Our response to Britain’s national growth emergency requires an unrelenting focus on pro-business policies, including a globally competitive tax system, smarter regulation, and policies that encourage investment and entrepreneurship.
It demands our dedication to securing free and fair global trade and market access – through the strengthening of our trade relationships with Europe, the USA, Asia and emerging markets, to expand opportunities for British businesses to export and grow.
And it means we must harness investment in high-growth sectors by tirelessly implementing our modern Industrial Strategy. We are prioritising advanced manufacturing, creative industries, life sciences, clean energy, defence, digital technologies, professional services and financial services. These priority sectors are the engines of the economic growth we must achieve.
To that end, today, I am issuing a new strategic mandate for the British Business Bank with four, simple, clear priorities
to support our most promising companies in the eight Industrial Strategy priority sectors, make finance markets work better for smaller businesses, unlock the potential of people and places across the country, and mobilise institutional capital at scale.
As part of this new mandate, I am requiring the Bank’s new £4 billion Industrial Strategy Growth Capital initiative to be focussed on our eight priority growth sectors; those where the return on investment will be at its highest.
I expect the Bank to deliver a two-thirds increase in its annual investments. I want it to crowd in tens of billions of pounds of private capital to support our most promising scale-ups.
By attracting capital investment, increasing the skills and productivity of the workforce, maximising the efficient and sustainable use of all our natural resources, reducing barriers to growth, and embracing AI and digital transformation, we can build a future-ready economy that repays innovation and rewards ambition, creates wealth and promotes prosperity.
And, in this spirit of candour, I have to say it is high time that this Labour Government stripped away the needless rules, over-regulation, and Whitehall red tape that hold back business and stifle economic growth. I know Rachel will say more about this shortly.
When regulation is well designed and carefully implemented, it can promote growth and investment. And, of course, we have to maintain standards of health and safety and consumer protection.
At the same time, we need to lighten the administrative load on the wealth creators so they can do more to drive economic growth.
The latest Business Perceptions Survey shows that almost half of businesses believe current regulation represents a roadblock to success.
We won’t sugar-coat the problem. We will deal with it. And the comprehensive package being announced by the Chancellor today shows that we mean what we say.
Regulation that restricts growth requires a rewrite or the rubbish bin. British business shouldn’t have to put up with it.
And, just as there are too many pointless administrative regulatory burdens, there are too many regulators. So, the regulators themselves will not go untouched by these reforms.
We will require regulators to fully explain when any of their decisions negatively impact business growth.
And we will go further still. I am commissioning a programme of independent assessments of our key regulators.
Starting with the Office of Rail and Road, this work, led by Richard Judge, will assess over-regulation, over-lap and over-reach.
Where we identify regulators that are doubling up, stepping on each other’s toes, or out of touch with the realities of the modern economy, we will streamline them.
Where their role is redundant, we will end them.
Not ‘one-in, one-out’ but ‘no role, no regulator’.
It’s as simple as that.
As proof of my commitment, today I am announcing the abolition of the British Hallmarking Council, with its functions transferring in to my department.
This is the start, not the end. Growing Britain’s economy means shrinking administrative regulatory burdens on British business.
In future weeks and months, we will unveil further focused measures designed to address our national growth challenge and to build prosperity across the nations and regions of the United Kingdom.
My pledge to you today is that we will do everything we must to ensure that your faith, confidence and investments pay real dividends.
We campaigned as a pro-business, pro-wealth creation, pro-growth party.
We are a pro-business, pro-wealth creation, pro-growth government.
We will build a pro-business, pro-wealth creation, pro-growth Britain.
And I will work relentlessly with you at your side to turn the tide. To end this era of low growth. And deliver the decade of national renewal we promised. Thank you.