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One-size-fits-all approach will harm UK recovery

Published:  10 December, 2020

The UK must adopt a regionally tailored recovery strategy if it is to recover fully from the impact of the global pandemic, which has exacerbated London-centric trends.

This week, the importance of avoiding a blanket approach to recovery was highlighted by Lloyds Bank, which called for a change in the way the government aims to meet local needs.

This has been stressed by others too, including IW Capital, a private investment firm specialising in growth opportunities for SMEs.

Now more than ever, the UK needs to focus on the needs of each individual region, the firm said. Action must be taken by Westminster to address regional funding gaps and to make sure that local voices are heeded if the UK is to prosper long term.

“The tactics that have worked in London and other major cities are not always transferable to other regions,” Luke Davis, CEO of IW Capital, said. “A one size fits all approach will simply not work and the best way to support our economy is from the ground up in a way that works for everyone.”

This week, Lloyds Bank said that economic recovery and support needs to be shaped by “local voices for local economies”.

Years of over-investment in London and the south east has led to a long-term funding deficit across the UK.

Adding to the conversation, IW Capital said that the gap in finances has only worsened as a result of the pandemic, with Covid continuing to widen regional, racial and socio-economic divides.

“Investors need to start looking outside of London and into the north and other regions where there are a number of great investment opportunities within the hospitality sector. Here at IW, we are doing just that with [entertainment venue] Rockwater in Hove where we have raised a significant amount of investment from the local community, and Transcend in South Wales. 

“Making growth investment more easily available to small businesses within this sector that are looking to grow should be a priority. The last time that the government-backed Enterprise Investment Scheme (EIS) was extended, it resulted in a significant jump in private investment into small businesses. Replicating this effect with new, or increased, incentives would provide a much needed boost to a section of the economy that is most in need, and so we hope this will be addressed in the near future,” Davis said.