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Chancellor John Healey is preparing to introduce a £150 million fund aimed at supporting businesses in the north of England, as part of a broader strategy to stimulate economic growth throughout the UK. This announcement is expected in a speech on Monday, where Healey will emphasize his intention to leverage public investment to attract additional private capital. The initiative focuses on fostering development by backing innovative and rapidly expanding firms.
The context for this plan is complex, with Healey confronting various pressures ahead of his first Budget presentation on 28 October. Challenges include rising government borrowing costs and the inflationary effects linked to the ongoing conflict in Iran. The opposition Conservatives have already criticized the proposal, arguing it will “do little to comfort hard-working families and businesses.”
Under Healey’s proposal, the £150 million fund, drawn from existing British Business Bank resources, will make investments ranging from £5 million to £15 million. The fund is designed to support university spin-outs and other ambitious companies based in northern England. The chancellor is expected to highlight the need for a “fundamental shift” in economic power distribution, saying, “The next chapter of Britain’s growth story will be written in more places.”
Economic experts and political figures have reacted cautiously to the plan. Helen Miller, director of the Institute for Fiscal Studies, acknowledged the desirability of economic growth across all regions but noted the practical difficulties, suggesting it is more feasible to foster growth in second or third cities rather than every area. Meanwhile, Conservative leader Kemi Badenoch and shadow chancellor Andrew Griffith have expressed concerns about rising borrowing rates and tax implications, with Griffith also criticizing Healey for not addressing defence spending amidst current international threats. Liberal Democrat deputy leader Daisy Cooper and Reform UK’s Robert Jenrick also questioned the plan’s effectiveness, describing it as unlikely to significantly impact growth or restore economic confidence
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