MICHAEL Heseltine will today call for a swathe of economic powers to be devolved to regional institutions, as he demands “every sinew of our body politic” is stretched in the UK’s fight to remain globally competitive.
In March the Conservative peer was commissioned by the government to look at ways of boosting economic growth. His proposals, published today, include abolishing two-tier local councils, boosting the role of chambers of commerce and introducing an obligation across public bodies to boost business.
“Government must now reverse the trend of the past century and unleash the dynamic potential of our local economies,” the former cabinet minister writes.
Heseltine criticises the government’s “piecemeal” approach to moving economic controls out of Whitehall, which he says has produced 13 distinct policies. Instead he desires for a single government policy on the economy.
More controversially, his report also calls for substantial restrictions on the ability of overseas firms to buy British firms: “In today’s world it is difficult to see who else, other than the national government, is capable of looking out for the longer term interests of UK plc”.
“The government should take a greater interest in foreign acquisitions,” he concludes.
Business groups gave a mixed welcome to the publication, although it gained the approval of the TUC.
Simon Walker, director general at the Institute of Directors, said the restrictions on overseas investment were “worrying” and “the idea that we should be suspicious of people from around the world putting the money into our country is misguided”.
John Longworth of the British Chambers of Commerce said the plan “focuses too much on institutions, rather than on the fundamental barriers to business growth”.
However both men welcomed plans to devolve more economic power to local bodies and backed a renewed focus on growth outside London.
Business secretary Vince Cable said the report showed “where government can improve its performance in delivering better interventions” and George Osborne said it challenges “received wisdom” and provides “ideas on how to bring government and industry together”.