Our CEO Mark Allan welcomes Andy Burnham to No.10

On Monday, Andy Burnham will become the UK’s next Prime Minister. As one of the largest private investors in the North West, our business has been fortunate to work directly with the PM-elect over several years.

One thing that’s clear to me from my time working with Andy is his sense of restless ambition – building pride in Greater Manchester which everyone can buy into. If that meant partnering with private investors, or governments of different political stripes, he was fully prepared to do so.

It might seem like window dressing, but that true sense of business and public sector partnership gave us the confidence to invest, at a time when markets are generally cautious.

And it’s perhaps why he was so politically successful, winning every single ward in the 2021 Mayoral election, and of course overturning tricky national polling to win Makerfield.

I’m hopeful of Andy taking this philosophy into No10 (both in the North and South).

Because the challenges facing this country are not going anywhere, and despite good intentions, the Keir Starmer Government hasn’t been able to drive through its early ambition. But there are things to build on.

An area we’re strongly aligned with Andy is on his place-first approach. It’s central to how we’ve managed our business over 80 years. And it should be central to the UK’s theory for driving growth. We were promised a place-based Industrial Strategy, but I'm afraid that it’s currently gathering dust on a Whitehall shelf. Andy knows a thing or two about a growth strategy, and indeed carved out growth zones in Greater Manchester, with funding to pump-prime investment.

Reviving and turbo-charging that national strategy would be a good signal to business on day one.

But devolution can’t solve everything. There are four main barriers to growth where direction from the centre is needed to boost growth in every postcode.

The first is higher interest rates

It’s why fiscal responsibility is so important and why there is so much scrutiny of the appointment of Chancellor. We currently spend more servicing our national debt than we do on the Department for Education. By definition that is spending on the past rather than investing in the future. We need to rebalance that. I hope the Parliamentary Labour Party is able to see how important its role in backing this is.

It’s of course worth making the point that fiscal responsibility and investment aren't opposites. The real test is what we're borrowing for. Markets may rightly be sceptical about stretching the public finances to fund day to day spending, but they're far more likely to support investment that boosts economic capacity.

Viewed through that lens, a council housebuilding programme makes a lot of sense. My hunch is that markets will buy into the UK Government investing in an asset. And everyone working in housing delivery knows that the missing ingredient to hitting housing targets is getting the public sector building at scale again.

The second is the cost of energy

 Every major investment decision today looks at energy costs, of which we have the highest in Europe. If we want reindustrialisation, more data centres, more studios and more advanced manufacturing, we’ve got to work on energy affordability.

The Keir Starmer Government was starting to move on this. But if we're serious about clean growth, electricity should be the cheapest form of energy in Britain, not the most expensive. We could immediately reduce costs by, as the CBI suggests, moving transition costs towards general taxation rather than simply placing them on energy bills.

The third area is the cost of employing people

It’s well-documented that the most recent budgets have driven up the costs of employment. We’ve seen a fall in entry level jobs, particularly in retail and hospitality businesses, which in turn is exacerbating the NEET crisis evidenced by the Milburn Review. Now I’m certainly not advocating for a new Labour Chancellor to reduce the minimum wage to drive up employment. Nor do I expect employer NICs to be cut given what I’ve already said about the UK’s fiscal position.

So, how to support retail and hospitality businesses to start hiring again if these two levers can’t be pulled?

The obvious next lever is business rates, which has increasingly become unmoored from the reality of operating those businesses, hampering investment. Andy Burnham has talked about a cut to rates for high street businesses – in the short term that makes sense, but perhaps he could be the UK Prime Minister to finally deliver the fundamental reform to business rates that all industries are crying out for.

Most speculation I read talks about the introduction of land value tax. While some of the criticisms of it in the media seem hyperbolic, I’m not sure this model would address many of the main criticisms businesses have of the current system – contested valuations, unpredictable bills, and investment uncertainty. We’ve suggested an alternative approach, but I hope that whatever is decided upon, reform is done with, and not to, bricks and mortar business.

The fourth barrier to growth is regulation

In this area, we were seeing progress under Keir Starmer, particularly on planning rules where some of the regulatory burden holding back development and growth has been rolled back. While it might not lead to overnight success, it’s important this work continues as the UK’s global competitiveness needs a boost.

In this area, our partnership with Andy Burnham in Greater Manchester gives me some confidence. He has always been clear with us that, as long as we’re investing in the social capital of the city – contributing to local economic growth, supporting young people to develop skills and enhancing social mobility – then he’s open to working with us.

He and his strong team, including Caroline Simpson, created a blueprint for investors, anchored in place. I’m keen to see him bring that approach into No10 and create a new sense of partnership with businesses across the country.