Among the many growth-boosting policies unveiled by Kwasi Kwarteng last week, the plan for 38 new low-tax, low-regulation Investment Zones was among the most exciting
It’s an especially welcome development for those of us who have long pushed for place-based solutions to regional disparities. And it is particularly encouraging to see that the East of England, long the UK’s ‘Cinderella region’ in terms of attention and investment from the Government, has not been neglected.
One of the zones announced by the Chancellor will be in Norfolk, reportedly encompassing the A11 ‘tech corridor’ and overlapping with Liz Truss’ constituency in South West Norfolk.
The idea behind the zones is simple: a designated geographic space which affords rates discounts and lighter planning restrictions for local businesses, and thereby lightens the regulatory load that encumbers business growth. Then, sit back and reap the economic benefits – including local employment, increased productivity, and greater prosperity in surrounding areas.
Alongside wide-ranging tax cuts, the plan is a central tenet of ‘Trussonomics’ and designed to spur development in the UK’s regions in particular – the same ‘levelling up’ goal pursued by Boris Johnson and Rishi Sunak. Indeed, the intention of Investment Zones seems to be to supplement similar schemes that already exist in the region.
When I was serving as Mayor of Cambridgeshire and Peterborough, I was inspired to see business leaders and politicians of different persuasions come together to support the bid for what eventually became ‘Freeport East’. I am in no doubt that that show of unity swayed the Government to approve a Freeport Zone at Felixstowe and Harwich.
One of the major figures involved in this project was none other than Liz Truss, who as Prime Minister is keen to build on this work by promoting more low-tax, low-regulation ‘growth areas’ in the East.
Her plan to build on these schemes through bold new Investment Zones is a huge step in the right direction. However, for regions like ours, which have a more complex and scattered economic geography than other regions, the question is whether a more ambitious spatial strategy is needed to unlock growth.
Rather than limiting the plan to a single central Investment Zone in Norfolk, for example, the Government could create a network of similar schemes in several places throughout the region. This archipelago of ‘growth zones’ could link-up multiple smaller, less concentrated points of economic light in the East – making sure all of that opportunity and prosperity isn’t concentrated in just one area.
To do this, however, the Government must not be restrictive in establishing additional zones which target locations and industries most in need of a boost. For example, in the East we are particularly keen to see cluster growth in life sciences and technology – and there is no reason why new zones could not be used to link our tech economies more closely together.
Equally, where zones are already successful, consideration should be given to placing Further Education facilities on-location in these spaces. Placing education facilities adjacent to innovators and leading businesses can only enhance opportunities for young people – and help address many gaping skills shortages in the East that are holding businesses back.
When I set up the Eastern Powerhouse alongside ResPublica, my main aim was to drive investment in the East by highlighting to business and government the region’s untapped potential for growth. The Investment Zones plan advances this ambition, but with a few tweaks it could be even more effective.
Our message to Liz Truss is simple: double down on the plan by creating multiple Investment Zones in strategic locations across the East, and thereby spread the economic dividends to every corner of the region.
As the fourth largest regional economy in the UK, the East has enormous untapped potential – and a fully decentralised network of Investment Zones could be the key to unlocking it.
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