Future is local – and Yorkshire must not miss out

A LEADING Establishment figure is predicting that global forces will drive a resurgence of the regions and has urged business and civic leaders to make sure that Yorkshire does not miss out.

Sir Michael Peat is a long-standing financial adviser to the Royal Household, has business connections to Russian oligarch Roman Abramovich and hedge fund billionaire Michael Hintze and is great grandson of one of the founders of KPMG.

Speaking at an event hosted by Deloitte in Leeds, he told a select audience of business leaders that weakened central governments, the changing nature of globalisation and the new politics of identity will lead to a rebalancing within nations.

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Sir Michael said: “Regions are the natural state of human organisation.

“A region is the best balance on one hand between economies of scale and on the other a feeling of belonging and fellowship and the ability to engender cooperation and synergy.

“Having said that, regions have been out of fashion for 200-300 years.

“But the wheel is turning. Regions and localism are the future.”

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Sir Michael based his argument on three key points. First, he said the great central reserves of taxation and borrowing are “all but exhausted” and power will begin to migrate back to the regions over the next decade.

“It’s part of what David Cameron refers to as Big Society. He would have called it Small State, but he didn’t dare,” he said.

Second, he claimed that the world is entering the third and final phase of globalisation, after periods of exploitation, empire and colonisation and the use of low-cost labour to feed high-consumption lifestyles.

He said globalisation will continue, but will be based on local skills, expertise and attributes.

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Third, he said the “new politics of identity” is fragmenting society, according to race, ethnicity, culture, religion, urban, rural and region.

He highlighted examples of Catalonia and the Basque region in Spain, Flanders in Belgium and Bavaria in Germany.

“We are seeing it in the context of the UK within Europe and we will see it increasingly in England,” he said, at the round table discussion.

“There is no doubt in my mind that there will be a rebalancing between the centre and the regions.”

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But he warned that the process would not be easy or even and, to date, no country in the world has successfully rebalanced its economy.

He said Yorkshire could lose out to other UK regions and must ensure that it is at the forefront of the rebalancing process by defining itself.

“The brand needs to be stronger – a lot stronger than it is at the moment – and it has to be a natural brand,” he said, criticising advertising campaigns as “a sign of lack of self confidence”.

“And to really do well, there needs to be regional representation... something that pulls the region together so everyone in the region works together so that the region wins.

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“You don’t get it through regional development agencies. They have been tried, tested and failed because they were too public sector and too political.

“You are not going to get it through local enterprise partnerships. They have got no money and they will struggle.

“The only way you will get it is to be innovative and to develop a new form of regional representation... that brings together the three sectors in a forum that talks and acts in a sensible way that can command people’s support and respect.

“If there was a will it could be quite easily done.”

Sir Michael said the new structure could break with the past and circumvent disillusionment with local and central government.

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“To really be successful there needs to be a new system of governance and let Yorkshire be the first place to have it,” he added. “Let Yorkshire innovate in that way.”

He questioned the ability of Government to help Yorkshire and said the UK is dependent on the global economy.

He added that the big shake-out of talent in the City, the increase in self-employment and entrepreneuralism and growing international demand for UK products and services can all benefit Yorkshire.

In response, fleet management entrepreneur Andrew Cope said with better infrastructure and a more active business community the North of England could create a viable alternative to London.

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Glass manufacturer Alan Henderson said London draws in successful people who want to further their ambitions.

CBI director Andrew Palmer said there is potential in delivering east to west links as opposed to north and south.

Deloitte practice senior partner Martin Jenkins said investment in High Speed 2 might be better spent on developing east-west infrastructure.

Leeds City Region LEP chairman Neil McLean said if his counterparts get their patches into a better state, they can start to work together. He said efforts to create a Yorkshire “super LEP” failed because players had too much on with setting up individual LEPs.

Barclays’ northern managing director Tony Walsh said: “I think Yorkshire has a very strong international brand.”

Marketing chief Lurene Joseph said: “We need the points of distinction.”