Jeremy Corbyn called on the Government to reverse years of under investment in the regions and remove the unfair advantage the South has over the North.
The Labour leader told business leaders at the CBI conference in London that it is time to bring prosperity to every region of the country.
“The Chancellor should use his autumn budget to change direction and invest - invest in long term growth,” he told CBI delegates.
“That’s what Labour has already pledged to do with a national transformation fund, to upgrade our country’s infrastructure and reverse years of under investment in the regions, unfairness between the South and the North and between East and West.
We have to be investing in transport, in energy and capital infrastructure right across the country.”
He said that if elected, Labour would establish a national investment bank with a network of regional development banks to provide finance for firms wanting to adopt and implement existing innovations or to develop entirely new ones.
“We are a very creative country,” he told the conference.
“We will only deliver the improvements our economy needs if they are backed up by a bold industrial strategy. Again this Government failed to act.
We’ve heard a lot of warm words on industrial strategy but we’re still waiting to hear how they will take it forward.”
He said that Labour would increase research and development spending by 3 per cent of GDP by 2030.
“We will invest £1.3bn on research and development in our first two years in government to galvanise private investment,” he said.
He also pledged that Labour would harness the £200bn spent by the public sector each year to boost local economies and local supply chains to bring prosperity to every region of the country.
“That’s how we deliver properly funded public services in the long run and ensure everyone earns enough to live on,” he told delegates.
“If we get this right it’s not just our economy that will be stronger, but our political institutions and our social bonds as well.
“We will, as you know, raise some taxes to pay for it - I knew you’d be welcoming that bit - to ensure that our spending plans fit within the constraints of our fiscal rules. When we do we’ll be clear and open about our tax plans, as we were during the General Election. We won’t do it by stealth.”
Mr Corbyn’s promise to invest in the regions was welcomed by the CBI.
Carolyn Fairbairn, CBI director-general, said: “Both businesses and Labour are determined to find ways to lift productivity and improve living standards in communities across the UK.”
But she warned against abandoning competitive markets.
“Jeremy Corbyn focused on the common ground between business and Labour,” she said.
“There is a shared aim: Industrial Strategy and Brexit must be focused on building a fair, innovative and productive UK economy where society benefits. But there are fundamental differences on the ways to get there.
“It is clear that competitive markets are the best way to improve people’s lives. Abandoning this model will hurt those who need help most and make the UK a laggard in the global race for investment.”
Prime Minister Theresa May told delegates that business leaders need to step up funding for research and investment and said UK firms are falling short of rivals in the US and Germany.
Calling for businesses to do more to fund research she said: “Today, for every £1 in Government support for R&D, British businesses invest £1.70.
“But in America, businesses invest around £2.70 and German businesses invest nearly £2.40.
“So I want you to work with us to drive up business investment.”