The need to boost economic growth outside London and the South East to revitalise local economies was the subject of a conversation between Michael Heseltine and the Builders Merchants’ Federation in Parliament just prior to Christmas.

The former Cabinet Minister spoke to BMF Policy Manager, Brett Amphlett, in the House of Lords after initiating a debate on his recent “No Stone Unturned in Pursuit of Growth” report.

His principal argument is that the United Kingdom must forge a new partnership between private enterprise and the public sector, and between central government and local communities. Failure to do so means Britain will not make best use of limited public funds and private investment.

Lord Heseltine warned that the challenge faced is too urgent and too comprehensive to be left solely to one player. He calls for radical changes to the way Whitehall works and how it allocates taxpayers money to support both under-performing regions, and certain industries.

Many of the 89 recommendations in “No Stone Unturned” do not directly relate to merchants and their suppliers & customers. Those that are relevant include ones about:

  • public purchasing standards and methods
  • simplifying procedures to avoid unnecessary duplication between government agencies
  • improving the effectiveness of Local Development Orders to instill best practice
  • all funding currently set aside for apprenticeships should de devolved to local areas.

Mr Amphlett raised the issue of Local Enterprise Partnerships (LEPs) and Chambers of Commerce and queried their current activity and responsibilities.

Under Lord Heseltine’s plans, LEPs would be allowed to compete for a share of a single national fund to support growth over a five year period. At current prices, this equates to £49 billion if it began in 2015-16. The purpose is to release national funds to approved LEP bids to boost local infrastructure, employment & skills, housing, business advisory support, and innovation.

According to the Report, the Government should look to the work and status of Chambers of Commerce. Lord Heseltine recommends an increased role for them - and gives ideas to boost their capacity and capability. He told the BMF that Chambers ought to:

  • enjoy enhanced legal status including being given basic statutory functions
  • receive a list of all business that pay Non-Domestic Rates so Chambers can identify businesses in their area more reliably
  • concentrate locally-based, private sector business support on Chambers of Commerce.

Michael Heseltine stopped short of making membership of a Chamber compulsory - but they should be sufficiently attractive to draw in more members.

Commenting after the debate, Brett Amphlett, BMF Policy Manager, remarked: “Lord Heseltine recognises there have been various initiatives and experiments over many years. Some, like Urban Development Corporations, were ones he himself tried with some degree of success. But successive governments have failed to adopt and implement comprehensive, coherent long-term strategies to turn ideas into real-world action. The former Deputy Prime Minister also accepts some of his ideas are controversial - and neither the current Government nor his own Party will touch them.

“I was delighted Michael Heseltine spared the time to talk. If he cannot persuade government and business to invest more, then we are in trouble. I remember him telling an audience 25 years ago about his dealings with industrialists and that, quote ‘the buggers won’t invest’. His Report is now in the hands of the Coalition Government - and the BMF waits to see what George Osborne, Vince Cable and others decide to do with Michael Heseltine’s recommendations.”