Hakim Yadi: Right medicine for economy after Brexit

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FOLLOWING the referendum vote for Brexit we cannot afford to sit back in shock. Instead we must unite across the country, working together to strengthen the UK’s global position, and fundamental to that is addressing economic issues in the North.

The economic imbalance of England’s North/South divide has harmed the overall strength of the UK. The dissatisfaction of those living in the North, as evidenced by the EU referendum vote which saw swathes of post-industrial areas vote to leave, has clearly illustrated that.

The Northern Powerhouse agenda which was supposed to address this imbalance needs to do much more, rebalancing the UK is too important to remain a slogan – it is essential to the growth and stability of the UK.

As Chancellor George Osborne stated earlier this month at Manchester’s Chamber of Commerce: “The best response [to Brexit] is to redouble efforts with the Northern Powerhouse”. However, redoubling efforts may not be enough, we need a bigger and clearer, well-funded economic plan for the North if the UK is to be successful in a global market place.

The Northern Powerhouse plan isn’t driven by idealism, the UK is in a much stronger position if it tries to grow areas of lower economic potential than try and grow the already saturated regions such as London at the same rate.

IMF figures show globally economic growth rates are stagnating at around £38,000 GDP per capita – the USA is at £41,500, Germany £35,631, and the UK at £33,386. London’s GDP at £33,257 is near the stagnation value, however the rate in the North of England is just £16,716.

If we were to raise the North’s GDP growth rate (3.9 per cent) to that of the UK average (4.4 per cent), by 2030 we would have added £56 billion in nominal terms to the country’s GDP, £44bn in real terms. With improvements in transport connectivity, skills, innovation, and inward investment by 2050 an extra 850,000 jobs could be created.

The life and health sciences sector has huge potential in the North of England with world-respected universities, nationally leading NHS Trusts, a thriving industry base and population of over 15m people. This sector alone supports over 1,000 companies, creating over 38,000 skilled jobs and generates over £8bn a year in exports.

The North has a phenomenal manufacturing base with the potential to grow, employ more workers and export more. The UK is the number one destination in Europe for biopharmaceutical companies to establish European headquarters. These have mostly landed in the South East.

A recent report by our colleagues in the South, MedCity, stated that London needs to add 250,000 sq ft of life science work and laboratory space over the next decade. It doesn’t, what needs to happen is for the North to be promoted for its abundance of wet lab space, access to high-quality research talent, low cost of business set-up and high quality of life.

In addition to the Chancellor’s announcement on reducing corporation tax, working outside of the South East should be encouraged further by linking tax incentives for companies that commit to year-on-year growth in head count in the North and Midlands.

A reduction in business rates and subsidies for relocating to Northern cities would further promote and support growth. Similar initiatives were suggested in the recently released A Manifesto for the North by the think tank ResPublica.

Our relationship with the EU and the rest of the world needs to remain strong. We need access to the EU single market to be able to grow. We need the best people to work at the North’s leading research centres, innovation parks and in the NHS. We must allow skilled workers to move freely across the EU and we must facilitate access for non-EU colleagues to access the EU markets through the UK.

The health and life science sector in the North of England is booming and it is ready to grow further but this will not happen without the support of a united government and a good post-Brexit deal.

We must forge a deal for the UK and the North that demonstrates that we are serious about addressing the socio-economic disparity within our own country, while showing the world that we are united and open for business ensuring we capitalise on the resources of the entire country to lead to a stronger United Kingdom for all of us.

Dr Hakim Yadi is chief executive of the Northern Health Science Alliance - an alliance of the top eight Northern universities and their associated NHS teaching Trusts.