If I Were Advising a New Prime Minister, This Is Where I’d Start

For too long, Britain has been living off a handful of inherited strengths while allowing large parts of the country to drift. London has carried too much of the weight. Financial services, law, media, consulting, advertising, universities and parts of the technology sector have masked a much deeper problem: outside a relatively small number of high-performing places, there are simply not enough good jobs.

That is the problem I would ask a new prime minister to confront.

Not just how do we grow GDP? Not just how do we reduce the deficit? Not just how do we attract more investment into London, Oxford and Cambridge?

But how do we build an economy where a young person in Hastings, Stoke, Sunderland, Cardiff, Plymouth, Dundee, Hull or Middlesbrough can look around and see a plausible future?

At the moment, too many cannot.

We have created an economy with elite islands and a great deal of economic shallows. We send more and more young people to university, but too often the jobs they graduate into do not justify the promise they were sold. We celebrate startups, but many of the best opportunities cluster in London. We talk endlessly about innovation, while failing to build the industrial, technical and vocational base needed to turn ideas into durable regional prosperity.

If I were advising a new prime minister, these are the areas I would focus on.

1. Stop pretending London can carry the whole country

London is one of Britain’s greatest assets. It is a global city in a way very few places are. Finance, law, media, government, culture, venture capital, universities, tourism and international talent all compound there. It generates tax, exports, prestige and soft power.

But London’s success has become a national anaesthetic.

It allows politicians to look at aggregate numbers and pretend the economy is basically functioning. It allows Britain to appear richer, more dynamic and more globally competitive than much of the country feels. If you removed London from the national picture, the UK would look dramatically poorer.

That is not an argument for weakening London. Quite the opposite. Britain should keep investing in London’s strengths. The City may not have collapsed after Brexit, but it has lost some of its inevitability. Frankfurt, Paris, Amsterdam and Dublin have all benefited from the UK making itself less central to European finance. London remains powerful, but it is no longer quite as automatic a choice as it once was.

A serious government would do two things at once: protect London’s global role, while refusing to let it become the only serious economic engine in the country.

That means building other places with real specialisms, not just giving them better slogans.

2. Build regional specialisms, not generic “growth zones”

Every government says it wants to help the regions. The problem is that the language is usually too vague. Levelling up. Northern Powerhouse. Growth zones. Innovation clusters. Investment corridors.

Most of it sounds plausible. Too little of it survives contact with reality.

Places do not become prosperous because a minister announces a zone. They become prosperous because they develop a dense concentration of skills, employers, suppliers, institutions, investors, infrastructure and tacit knowledge around something the world actually wants.

Manchester and Salford have a credible claim around media, broadcasting, sport, digital production and parts of the creative economy. Cardiff and South Wales have television production, compound semiconductors and green industry. Bristol has aerospace, robotics, climate technology and creative technology. Sheffield has advanced materials. The West Midlands has deep manufacturing heritage. The North East has opportunities in batteries, offshore wind, rail and defence. Dundee, Leamington Spa and Brighton have strengths in games and interactive media. The South West has marine technology, food, renewables and tourism.

These are the beginnings of economic stories. They need to be treated as such.

The point is not that every town needs to become a mini-London. That is impossible and undesirable. The point is that every region needs a small number of credible specialisms it can build around.

That requires uncomfortable focus. Government cannot sprinkle money evenly and expect transformation. It has to make bets. It has to say: this place has a real chance to be nationally or internationally important in this field, and we are going to back it consistently for twenty years.

Not one parliament. Not one press release. Twenty years.

3. Rebuild the missing middle of the economy

Britain has become strangely obsessed with two kinds of company: very large incumbents and venture-backed tech startups.

Both matter. But neither is enough.

What we are missing is the layer of specialist, skilled, export-capable firms that sit between the corner shop and the global giant. Germany has its Mittelstand: often family-owned, regionally rooted, technically excellent businesses that dominate narrow global niches. They make components, tools, machines, instruments and systems most consumers never think about, but which the world depends on.

Britain has versions of this. Advanced motorsport engineering. Aerospace. Precision manufacturing. Medical devices. Marine engineering. Defence. Scientific instruments. Games. Specialist materials. But the layer is too thin.

This is where industrial policy should focus.

Not just on the next AI unicorn. Not just on software businesses that can raise a big seed round and hire in London. We should be backing companies that make difficult things well: clean energy components, robotics, medical equipment, lab hardware, advanced materials, retrofit systems, modular housing parts, marine technology, precision tools, nuclear components, battery systems and high-quality industrial machinery.

These businesses may never produce the valuations of software companies. But they create something Britain badly needs: skilled jobs, apprenticeships, exports, local supply chains, and a reason for young people to stay in or return to their region.

A country cannot live on apps, coffee shops and consulting decks alone. It needs to make things too.

4. Treat vocational education as elite infrastructure

One of Britain’s great mistakes has been to treat vocational education as second best.

For decades, the social bargain has been: go to university, get a degree, become more employable. That has worked for some. But it has also created a large number of smart graduates with expensive credentials and no clear career path.

At the same time, we have shortages of technicians, machinists, welders, electricians, fabricators, lab technicians, heat-pump installers, retrofit specialists, CNC operators, nuclear engineers, battery specialists, robotics operators and people who can bridge design, engineering and production.

This is absurd.

If we want a more productive economy, we need to stop acting as if the only respectable route into adulthood is a three-year degree followed by laptop work.

A prime minister should make technical education a national priority. Not as a consolation prize for people who “aren’t academic”, but as a high-status route into serious, well-paid, skilled work.

That means better further education colleges. Stronger apprenticeships. More employer-linked training. More applied technical universities. More modular adult learning. More investment in workshops, labs and equipment. And, crucially, it means building the employers that can absorb those skills.

Training people for jobs that do not exist is just a more elaborate form of disappointment.

5. Make universities engines of local productive capacity

Britain’s universities are genuinely world-class. They attract international students, produce research, generate soft power and support local economies. But we should be honest about the limits of the current model.

Too many universities are trying to behave like research-intensive institutions. Too many degrees offer weak labour-market returns. Too many graduates end up underemployed. Too much research fails to turn into domestic industrial capability. Too much of the value created by educating overseas students leaves the country when they do.

The answer is not to weaken universities. It is to connect them more deliberately to the productive economy.

Every major university should be asked a simple question: what is your role in the economy around you?

Not just how many students do you teach? Not just how many papers do you publish? But what industries are you helping to build? What employers are you working with? What technical skills are you producing? What spinouts are staying local? What supply chains are forming around you? What regional advantage are you deepening?

A strong regional economy might need one research university, one applied technical university, several excellent FE colleges, employer-led apprenticeship networks, shared labs, prototyping facilities, local R&D centres and patient regional capital.

At the moment, too many places have the education layer without the employer layer.

That has to change.

6. Repair the high street as economic infrastructure

The high street is often discussed sentimentally, as if the question is whether we can bring back the butcher, the baker and the old department store.

That misses the point.

The high street is not just retail. It is civic infrastructure. It is where local economies become visible. It is where people meet, eat, work, browse, repair, learn, organise, start things and feel whether their town is moving forwards or backwards.

When the high street dies, the damage is not just commercial. It is psychological.

The current tax system does not help. Business rates punish visible, place-based businesses in a way that many online businesses avoid. A shop, café, studio, small restaurant or workshop carries fixed costs that an online platform does not face in the same way. Then we wonder why town centres hollow out.

A serious government would rebalance this.

Business rates should be reformed to reduce the burden on small, independent, place-based businesses, especially in struggling towns. New businesses should receive tapered support in their first few years, when fixed costs are most dangerous. Empty properties should be brought back into use. Landlords should not be allowed to sit indefinitely on dead frontage while waiting for unrealistic rents.

But renewal cannot mean nostalgia. The high street of the future will not be purely retail. It should be mixed-use: food, childcare, clinics, workspaces, libraries, markets, evening economy, training spaces, repair shops, studios, small-scale production and housing above shops.

The goal is not to recreate 1987. It is to make town centres useful again.

7. Take coastal towns seriously

Some of the most politically alienated places in Britain are not large post-industrial cities. They are coastal towns.

Many seaside towns were built around a domestic tourism model that no longer works at scale. Cheap flights and package holidays pulled away the middle-class visitor base. What remained in many places was seasonal work, poor housing, weak transport, fragile public services, ageing populations and limited career options.

You can see the consequences in places like Hastings, Blackpool, Great Yarmouth, Clacton and parts of the Kent and Sussex coast. Some towns have managed partial reinvention through food, culture, remote workers, art, independent retail and better public realm. But many still feel cut off from the national economy.

These places need specific strategies, not generic regeneration language.

For some, the answer will be tourism, culture and food. For others, marine industries, offshore wind, port logistics, further education, care, health, creative industries or remote-work relocation. But the starting point has to be a serious question: what is this town for now?

When a place loses its economic purpose, politics curdles. People become angry not because they are irrational, but because they can see that the country has no real plan for them.

8. Fix the VAT cliff edge without punishing microbusinesses

The VAT threshold is a classic example of a policy that looks technical but shapes behaviour.

Once a business crosses the threshold, it faces a sudden jump in admin, pricing complexity and often a real hit to competitiveness, especially if it sells to consumers who cannot reclaim VAT. So some small businesses deliberately stay below the line. They turn down work. They reduce hours. They avoid hiring. They remain smaller than they might otherwise be.

That is bad policy.

But the answer is not simply to force every tiny business into VAT from day one. That would create more admin, higher prices and another reason not to start.

The better answer is to smooth the cliff edge. Create a taper. Simplify reporting. Make the flat-rate scheme genuinely useful. Treat consumer-facing microbusinesses differently from B2B consultancies. Avoid punishing the exact moment when someone tries to turn self-employment into a proper business.

More broadly, tax policy should ask a simple question: are we making it easier or harder for people to build productive enterprises?

Too often, the answer is harder.

9. Rebalance tax away from work, shops and mobility

The British tax system has accumulated too many distortions.

We tax work heavily. We tax employment through National Insurance. We tax moving house through stamp duty. We tax physical businesses through business rates. We under-tax some forms of property wealth and economic rent. We create thresholds and cliffs that encourage people and firms to behave unnaturally.

A new prime minister should not start with the fantasy that taxes can simply be cut. The demands on the state are too large: health, social care, defence, education, infrastructure, energy and an ageing population all require money.

The better question is what kind of taxes do the least damage.

That probably means lower taxes on work, hiring, mobility and small business formation. It means a more serious approach to land and property taxation. It means reforming council tax. It means reducing or replacing stamp duty. It means thinking harder about how online commerce contributes to the local infrastructure it depends on. And it means designing the system around productive behaviour rather than accidental loopholes.

Tax is not just how the state raises money. It is a set of instructions.

At the moment, too many of those instructions say: do not move, do not hire, do not grow, do not open a shop, do not cross the threshold.

10. Get closer to Europe without relitigating the referendum forever

Brexit is not the only reason Britain is struggling. But it made many of our structural weaknesses worse.

A smaller country on the edge of Europe needs trade. It needs openness. It needs access to markets, supply chains, talent and investment. Leaving the European Union made that harder, especially for goods, manufacturing and supply-chain-intensive industries.

The political class has spent too long being afraid of saying this plainly.

A new prime minister does not need to reopen every argument from 2016. But they do need to be honest that Britain’s economic future depends on a closer, more practical relationship with Europe.

That means reducing friction for goods. Deepening cooperation on energy. Making it easier for professionals, researchers, creatives and young people to move. Rebuilding scientific and industrial collaboration. And being willing to accept that access usually comes with obligations.

The fantasy version of sovereignty says Britain should make every rule alone. The useful version says Britain should have enough influence, wealth and capability to shape its own future.

Those are not the same thing.

11. Use clean energy to build industry, not just lower bills

The energy transition is often framed as a cost. It should also be framed as an industrial opportunity.

Britain is investing heavily in offshore wind, grid infrastructure, nuclear, hydrogen, storage, retrofitting and clean power. But if the turbines, components, engineering expertise and high-value supply chains are mostly imported, we will have missed a huge opportunity.

The question should not only be: how do we decarbonise?

It should be: how do we capture more of the value?

The Rolls-Royce small modular reactor programme points in the right direction. But the test is whether it creates deep domestic capability, or whether Britain ends up as a buyer, site operator and project sponsor while too much of the high-value work happens elsewhere.

The same applies to wind, housing retrofit, grid upgrades and clean industrial technology. Public investment should be used to build domestic skills, suppliers and exportable expertise.

Net zero should not just be an environmental policy. It should be one of the foundations of Britain’s next industrial strategy.

12. Build a state that can actually deliver

All of this depends on state capacity.

Britain has become very good at reviews, consultations, strategies, pilots, announcements and relaunches. It is much less good at sustained delivery.

A serious prime minister would need to rebuild the machinery of implementation. That means fewer gimmicks, clearer priorities, better procurement, more commercial skill inside government, stronger local institutions, longer funding cycles, more devolution, and a Treasury willing to distinguish investment from day-to-day spending.

One reason Britain underperforms is that nobody believes the plan will survive the next reshuffle.

Industrial strategy requires consistency. Skills policy requires consistency. Regional growth requires consistency. Infrastructure requires consistency. University reform requires consistency. Energy investment requires consistency.

If every policy is rewritten every three years, no serious ecosystem can form.

The test

The test for the next prime minister is not whether they can produce a new slogan for growth.

The test is whether they can answer this question:

What are the good jobs of the future, where will they be, and how will people get into them?

Until that question is answered, Britain will keep producing the same pattern: an overheated London, a handful of successful cities, too many underpowered towns, too many graduates in disappointing jobs, too many small businesses trapped below thresholds, too many high streets fading, and too many people concluding that the economy has no real place for them.

The country does not need more abstract optimism. It needs productive capacity.

It needs regional specialisms. It needs skilled technical routes. It needs serious local employers. It needs high streets that function. It needs universities tied more closely to the industries around them. It needs tax policy that rewards work, mobility and enterprise. It needs a pragmatic relationship with Europe. It needs clean energy policy that builds domestic capability. And it needs a state capable of sticking with a plan for longer than a news cycle.

Britain is not poor because it lacks intelligence or imagination.

It is poor because it has too often failed to turn intelligence and imagination into durable institutions, useful infrastructure, exportable products, skilled jobs and thriving places.

That is the work now.