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Heseltine Review calls for regional growth

More power should be passed down from Whitehall to local councils to boost economic growth and competitiveness in the UK, an official review of the economy has stated.

Lord Heseltine's report commissioned by the Government said that more decisive and bold action needed to be taken to stimulate the economy.

The former deputy prime minister's report warned that businesses fear 'the UK does not have a strategy for growth and wealth creation'.

"The world is increasingly competitive and we have to respond to that or we will slip gradually down the world's growth league tables," he said.

A key point amongst the 89 recommendations was the shift of power from London to regional cities. The proposal would see £58 billion of funding devolved to Local Enterprise Partnerships (LEPs), a partnership of local businesses and local authorities tasked with influencing their local economies.

The Forum of Private Business (FPB) agreed that regions were better placed to know their economic strengths and weaknesses.

"For the nation's economy to be successfully rebalanced with more of a focus on private sector growth, all regions of the UK must be cultivated and given equal help, not just the south east," he said.

John Cridland, director general of the Confederation of British Industry (CBI) said that the review was 'pushing in exactly the right direction' but he was 'rather doubtful' that transfer of £58bn would be approved.

John Longworth, head of the British Chambers of Commerce (BCC) warned that the Government should think carefully before undergoing a major restructuring, with focus first on access to finance, help for exporters, and an improved education and training system to support business needs.

Other key areas of the report include,

  • Continuing deregulation in the UK, although Heseltine stated that regulation from Europe was not a major problem for British businesses.
  • Creation of a National Growth Strategy and Growth Council with agreed commitments
  • Enhanced functions for the Chambers of Commerce, including statutory functions.