Welcome to TheCityUK National Conference, supported by our sponsors PwC and Interactive Investor.
It is wonderful to see everyone here in Manchester at the Lowry Hotel, which, if I am to continue with Miles’ footballing reference, I’m told was home to Jose Mourinho during his two-year spell as manager of Manchester United.
He might have called himself the “Special One” – I don’t think it would be too controversial to say that not everyone in Manchester would agree with that - but I’m very pleased to introduce our own undoubtedly special guests and speakers today, including Bim Afolami MP, the very recently appointed Economic Secretary to the Treasury, and Dame Angela Eagle DBE MP, Treasury Select Committee member. And, while we can’t compete with Old Trafford or the Etihad Stadium for noise, I do hope we hear your voices in comments, questions and feedback throughout the day.
We’ve come here to discuss the central role of the financial and professional services in the North West and wider UK economy, and how to get that engine working at top speed to power growth across all the regions and nations. And it’s fitting that we all meet here, at a such a pivotal time, in a pivotal place.
Manchester is a city of transformation and resilience. As the birthplace of the Industrial Revolution, Manchester pioneered a new era, harnessing steam power and mechanisation. The city was at the forefront of the 19th-century industrial boom, embodying the UK's journey towards modernisation and economic prowess. Fast forward to today, and Manchester's evolution continues. The city has transitioned from industrial dominance to a service-oriented powerhouse. In the Northwest, our combined industry now employs 289,000 people - a few thousand more than the Southeast and a figure only beaten by London.
Related professional services exports from the Northwest more than doubled between 2015 and 2021. This remarkable growth is a testament to the region's adaptability and innovative spirit. Manchester has become the nation's second-largest legal, accounting and insurance hub, reinforcing its pivotal role in the UK's economic landscape.
Our combined financial and related professional services industry, much like the industrial engines of the past, is a driving force behind the UK's economic power. It is vitally important that we have thriving regions and differentiated financial centres across the UK, pulling together to support a more diverse and enterprising economy.
Diversification, across professions, specialisms and regional centres, brings resilience. It makes the economy as a whole more resilient to shocks and ensures the benefits of economic growth are spread more widely. For that reason, it is important that investment is channelled into our strong regional financial centres and not solely into London. Together, we provide the essential capital, financial expertise, and legal services that underpin the competitiveness of businesses and by working collaboratively across the UK we reinforce and enhance our international competitiveness.
Our role is crucial in enabling enterprises to compete and flourish, both here in the UK and on the global stage. And we find ourselves at a critical juncture. The UK – along with many other nations across the globe – is potentially on the cusp of significant political change, with elections looming on the horizon.
This period is not only pivotal for our industry but also for the wider economy as we navigate the challenges and opportunities of new policies and shifting geopolitical landscapes. We are all grappling with unprecedented levels of unpredictability, affecting everything from market dynamics to regulatory frameworks and changing workplace practices.
In these uncertain times, we cannot control every input and every outcome. However, we must ensure that we focus on our strengths and keep doing what we do best to remain globally competitive. Regardless of the election results or the shape of future policies, the prosperity of the UK hinges on a robust and thriving financial and professional services industry, across all the UK’s regions and nations. At TheCityUK, our regions and nations strategy is focused on the three core areas of devolution, skills and infrastructure. Or, we could say, the three Ps of power, people and prosperity.
Diversifying the sources of power will help to diversify the sources of growth for our collective industries. To bolster this, we support the continued roll out of the metro mayor and combined authority model across all English regions that desire it, while also enhancing the powers of existing mayoral combined authorities.
Consistency in devolution deals is crucial, and clear timelines for the introduction of new deals and authorities should be established. Metro mayors could play a strategic role in overseeing major infrastructure projects, thereby addressing challenges like planning delays.
Turning to people, a successful and competitive industry depends on bright minds. And investment in skills has no upper limit to the returns it can produce. As the American economist John Maurice Clark said, “Knowledge is the only instrument of production that is not subject to diminishing returns.”
Attracting and nurturing talent is vital for our industry. Localised strategies are key to addressing specific skills needs, giving stronger voices for employers in the skills planning process. We support the rollout of local skills plans as proposed in the Skills Act and the devolution of post-16 education resources and career advice. However, the current operation of the Apprenticeship Levy presents some challenges, suggesting a need for a more flexible system. We are actively engaged with government on that issue.
And finally, our prosperity and growth depend on how easy it is to communicate effectively, travel efficiently and share ideas without friction. Improving our digital and transport infrastructure is essential for enhancing regional connectivity and fostering growth across all sectors, not just ours. Infrastructure improvements aimed at sustainability align with the UK’s goals of achieving net zero, opening new investment avenues to stimulate national growth.
Continued improvements in these areas will allow the regions to make an even greater contribution to our combined industries and ultimately the UK economy. It’s difficult to overstate the role of financial and related professional services in the economy. The industry contributed £254 billion to the UK economy in 2021, representing over 12 percent of total gross value added. Our exports came to £135 billion across Great Britain in the same year, with around half of this total coming from outside London. And collectively across the country, we employ one in every 13 people.
With so much activity under our banner, it is crucial for regulatory policies to get the balance right between safety and risk. Here it will be important to acknowledge the economic opportunity costs that come with a zero-risk approach. As a result, we must continue to work together to harness the full potential of the industry, ensuring it maintains a central place as a dynamic engine for growth in every region and nation of the UK.
Thank you for listening. And, as I certainly don’t want to get a yellow card for timewasting, with no further ado I’m going to hand back to Miles to introduce our first panel session of the day, which will delve into equipping our people, communities and companies with the skills they need to grow.
Thank you, and I hope you all have a productive and enjoyable conference.