Lord Heseltine has released an economic review, entitled No Stone Unturned in Pursuit of Growth, and outlined plans for recovery in the UK.
The peer made 89 recommendations to the Government, which included advice to maximise potential in different regions, rather than focusing on London, and stimulate local growth in partnership with central government.
Under the heading “Making it happen” Lord Heseltine said: “An experienced implementation team should be set up in the centre of government, including secondees from the private sector, LEPs and local authorities.”
The review emphasised the importance of education and skills to underpin economic growth and wealth creation.
Intervention in failing schools, streamlined bureaucracy and engagement with businesses were included in advice to the education sector, while Lord Heseltine said the private sector must work with the Government to buttress business infrastructure, and foreign acquisitions must be prioritised.
The Chancellor, George Osborne, who received the review on Wednesday, responded positively.
He said: “I wanted Lord Heseltine to do what he does best: challenge received wisdom and give us ideas on how to bring Government and industry together.
“He has done exactly that. This is a report bursting with ideas and we will study it very carefully.”
Vince Cable, Business Secretary, thanked Lord Heseltine and commented: “It raises a number of important and cross cutting issues that impact on the government’s ability to interact effectively with business throughout the country.“
Lord Heseltine’s findings show where government can improve its performance in delivering better interventions. We will now need time to consider its numerous recommendations and will respond in the coming months.”
The Institute of Economic Development (IED) welcomed the proposals commissioned by David Cameron in March this year, and said the review was in line with their organisation’s recommendations.
Keith Burge, Chairman of IED said: “At long last there is recognition at a senior level within the Government that economic development is an investment and not merely a cost.
“Give our members the tools to do their jobs properly and we will play our part in stimulating and accelerating growth.”
The review made the particular point that Local Enterprise Partnerships should develop their own economic plans and provide support to the private sector.
CBI’s Director-General, John Cridland commented: “CBI is calling for a broader spatial approach than can be provided by LEPs alone to be taken in some policy areas, for example when implementing new transport projects which cross LEP boundaries, where a purely local or central approach will not deliver for business.”
He added: “Lord Heseltine’s review highlights the need for powerful governance structures to support private sector growth throughout the UK.
“To successfully rebalance the economy towards private sector growth, every part of Britain needs to grow – we mustn’t just rely on the usual suspects of London and the South-East.”
Lord Heseltine commented on his proposals, and highlighted that collaboration between the public and private sectors, as well as local and central government, is imperative to economic recovery.
He said: “I have looked across the board at how we create wealth, and spoken from my own experience in business and government.
“What I have outlined today points the way towards prosperity. We will not just need the determination of government, but of every business, every local leader and every individual to deliver this vision.”
Senior policy adviser at the Forum of Private Business, Alex Jackman commented: “Worryingly, Lord Heseltine seems to be mapping out a system, the foundations of which are based on the chambers of commerce. He even proposes legislating to give the chambers ‘basic statutory functions’ – we question how this could ever be independent from government.
“We do not want to see the type of cronyism from the 80s that Lord Heseltine himself will remember when it comes to business support.
“It also seems to us that Lord Heseltine is seriously floating the idea of compulsory membership of the chambers. While the research included in the review suggests that businesses which use business support services are more likely to still be trading after three years than those that don’t, we would not support forcing firms to take membership.
“We need a platform providing better access to all relevant business support bodies, giving existing small businesses and those of tomorrow real choice - it does not follow that Government can justify interfering in a private marketplace in such a crude manner.”
Geraint Jones, private client partner at City accountants Reeves, said: "It is good to see that the government is exploring ways to support growth and build relationships between public and private sectors.
"Yet the solutions, including encouraging greater state intervention and regulation, are unlikely to help small and medium sized businesses.
"Enabling businesses to gain better access to funding and national insurance holidays, for example, would be of more practical benefit and have an immediate impact."