Economic Strategy and Final Advice

Andy Burnham, looking likely to be the next prrime Minister. Are you optimistic? I'm optimistic because he's worked in central government. London has attracted so much capital. We know how to do big projects in a city area. We've just not done it elsewhere across the UK. So all the money's piled in here. We have six trillion pounds of long term capital in the UK, almost the highest ratio of long term capital to GDP. is there in the UK. It's how do we kick start it? What would be your advice for Burnham? This episode is brought to you by Octopus Energy. Greg Jackson, the CEO is with us now. Greg, I want you to look into your crystal ball and tell me what's your vision in terms of let's say ten years for how the average UK house will be powered? As we build out more and more renewables on the grid The underlying electricity systems much more volatile And that means that people' got their own solar panels and their own batteries can help balance the grid And cars are going to be doing that as well So you're going to end up with a system that looks a lot more like the internet where everything is automatically Iroving just like in the Innet improves your bandwidth. Here it'll be improving your energy cost. And prices are going to come down. And by the way It brings prices down even for those people who don't have the solar panels than batteries or the electric cars because it makes the whole system more efficient For everybody. Let's hope that's right, then, Greg, thank you. Now on with today's episode. I'm Arch Man. I'm Maddison Skinner, I'm Ev Yovich. I'm D Coria Moore. want to train like a Red Bowl athlete. Tell us your fitness goals this summer to enter the Red Bull Athlete challenge. You'll get to try each of our workouts for a chance to win an ultimate Red Bulll experience. They you have what it takes This episode is brought to you by Google Chrome You think you know a browser, but Gemini and Chrome, that's new. It can help you with practically anything on the web, like restoring a vintage motorcycle from a fifty page restoration block, or finally break down that long article you've had open for weeks. Gemini and Chrome is here for it. Ready to make anything online makes sense? There's no place like Chrome. Check responssees setup required compatibility and availability varies eighteen plus Hellone and welcome to theest is Money with me, Steh McGon. Now wouldn't it be nice if we had six trillion pounds to spend on growing the economy? Well, my guest today reckons it's there for the taking. Nigel Wilson is the former CEO of the financial Giant Legal and General, and he's funneeled billions of pounds retension and insurance money, so long term capital into regional regeneration projects. And he's long argued for more investment in the regions not as a charity case, but as a genuine investment opportunity. So this would be music to Burnham's ears, I'm. So what would the new PM have to do to get his hands on this money and this potential growth Here's my interview with Nigel Wilson Nigel, I've been really keen to speak to you for a while because you have some really interesting thoughts on how we get equality across the country and not all the money just coming into London, which is obviously something I'm obsessed about. I know we're from the same part of the world. At the same time as talking to you, we've obviously got Andy Burnham looking likely to be the next prrime Minister. So I guess can you give us a sense of what you think about Andy Burnham coming in as Prime Minister and what that might mean for us. I think your synopsis is very good because London has attracted so much capital. and But we've used that money wisely, I think. I think there's some amazing projects in London. Canary Wolf, there's an obvious example, King's Cross, the Elizabeth Line, the Jubilee Line, the DLR, which have all opened up London. Even Thamess Tydway is a great project. Plus we've had HS one for a long time. So we know how to do big projects in a city area We've just not done it elsewhere across the UK. So all the money's piled in here. Similarly all the venture capital is in the golden triangle. eighty percent of all that money comes into the Glden Tangle. So very unfair And the regions themselves haven't helped because all the time they're getting the train to Westminster saying, please give me some money. and you know on an allocation basis, that was wasn't a great idea Whas We did primarily when I was at Lgland generenal, we went there and acted as the principal investor, prrincipled and principal and it worked amazingly well, prettyty much everywhere across the country. Yeah, give us some examples of what you mean by that? Well, I've picked two from the northeast where the two breweries, the Scottish Newcastle Brewery and the Vaukx Breweries recites led empty for over twenty years. and we've turned them into fantastic areas now. the N Crastock project has been a massive success. In partnership with the The institution' there, particularly the universities, and it's right beside the football ground, thousandousands of new jobs. And we're getting the startup culture and scale up culture as a consequence of that because doors lead to doors. If you start doing things, other people get to believe. And so we will get a scale up business. and as we've discussed before, the five universities in the Northeast of all got together now and put some money into a fund with the support of the mayor which is always critical to all of this. And at Sunderland, we did the same thing. Sundnderland had a look at what we'd done in New Castle and said, We'd like a head of that too. and so we did the Folksbury site there, which Amazingly w sort of best new building in the UK beating Goldman Sachs into second place, right. You were sitting there, you didn't go to Westminster ask for money. How did you get them going? And was it seen as rather than philanthropy, this was you know money to be made? Yeah yes, we made money out of all of this but you know informed and rewarded risks, including Manchester, where we invested three to four billion pounds in Manchester. But we just have this ease of use metric. How easy are the people in a local area to get on with And how committed will they be to go through this business plan with us? And we would provide pretty much all of the capital that was needed for the projects and make a return out of it. And some areas were too difficult or it took us a long time to penetrate. Sheffield would have been an awkward town Wh Well we used to have what we call called Mormns and groon' dinners. We'd really tabled as a dinner for the influentials in any town or city across the UK, have them all in a room, and then look at the demographics, look at the economics, look at the financial situation, and then ask them to explain why they've done so poorly You then get mourns and grons about who's let them down, He let me down, She let me down. And after about ten or fifteen minutes, they realize they're sounding rather pathetic about it. And it's clearly obvious that they're not working collectively as a team. Some of them would have been viable though I'm assuming. They could have been viable, I think. But actually other people objected to them. there's a lot of noism going on. Why is that project getting priority over my project whatever. whereas you need a a London type of solution where you actually inbig in the context of the town or city that you're in, but actually deliver deliver on time on budget and and given the lack of complexity of the projects. at Canary Whorf, we're building fifty eight story towers right beside the Rriver Thames with the Elizabeth line running underneath. You know these were four to eight story buildings And for instance, in Manchester, we converted the VIptO factory, which had been closed for many years. Some people will remember Vimtone and turned it into flats and houses, and our goal was to make the houses, three bedroom houses with a garage one hundred and forty nine thousand nine and ninety nine pounds. so it was affordable in a commercial sense rather than just in a social context. You do hear regions outside of London morning, and I think understandably, because there has been a lack of investment and that's led to real problems of depriation, deprivation and you know unemployment and everything else You're saying these are not charity cases, actually, these are genuine viable investment opportunities and this is how we get growth across the economy. So it's not just in London. It's everywhere. It's pretty much everywhere. I think there are uninvestable places are really difficult to placeist, which will need public support, but the big towns and cities need very little of it. positive political will and a confidence at's an Indiana John's moment to work in partnership with the private sector to actually Get on and make all these things happen. And so where is that money coming from then? When it comes to the pension funds, know we have six trillion pounds of long term capital in the UK, almost the highest ratio of long term capital to GDP in the development. trillion. sixix trillion pounds We're not short of capital So it's not a capital availability problem, it's a capital allocation problem tiny amount of that money historically has been invested outside of London. Because London's been so successful, it's been rewarded capital. so people keep plowing more money into London. As I mentioned, those many projects which have been either private or public private have all been pretty successful. These other places don't have that. And even if you go to Newcastle, the project beside the saage, there's just a big hole in the ground and they've been working on it for several years.. And that's the sort of thing that has happened too often in the past and is still happening right now where they haven't got the capital partners sitting beside them to really drive growth. So let me just dig into this then because we often talk on this podcast about how do we get pension funds to invest more in projects in the UK? Should there be some type of government intervention in terms of tax incentives or other things like that? What it sounds like you're saying is actually is the same returns to be made from investing in regeneration projects as there is to, I don't know, put it in stocks and shares and putting it into the magnificent seven or you know the tech company' doing well. Well, I think there's different risk returns on these, but they're rewarded appropriately for the risks that you're taking We have to develop this system, which I talked about earlier about the VC and the startups and scale ups, because in the UK, SCIS, EIS and VCTs are all tax advantaged and you're mandated to invest in UK businesses. You can't get the money in and say, Well, actually I found this really cute business in California. I'll put all the money in there, which is interesting. Cash Iis are the same You can't say, Jesus, have you seen the writs in Venezuela? it's fifty eight percent you can get on your money. I'll put it all my cash icer in in Venezuela, you have to put it into sterling accounts here in the UK. So again, mandated tensions, I think we should have what's called soft compulsion This is what we invented during auto enrollment. Instead of getting people to tick a box to opt in, you had to tick a box to opt out. And a lot of and then you were put in a default fund, even if you didn't fill in the form saying where you should put your money. So the money is flowing in there, we then should have another box which says, X percent, ten percent is going to be invested in growth initiatives right across the UK. If you want to invest in that, It's automatically done for you, soft compulsion. If you don't want to invest in that, you tick a box and say no. in the same way that you did that when you If you do that, are you not going to then ask the person whose money is going into the pension pot going to go, Well hang on, all I care about is returns. whichich one's giving me returns? As I said, we put in billions of this type of money into these activities already. And The sad truth is most people put their money in the default fund and that default fund should include startups and scale ups in Britain because some of those and many of those are going to be huge successors And I'll use AM as an example. AM was founded in Cambridge, grew in Cambridge, listed in the UK very suc successfully. sold to Softbank. Yeah And the Soft Bank acquisition proice was about fifty billion do it's less than fifty billion do, but it's now four hundred billion do. Of that three hundred fifty billion, one percent has gone to UK shareholders and ninety nine percent primarily to the rest of the world. And that's what happens as a consequence of the model that we've got now. And It's only if you look at the data over a long period of time, you realize that's just a mistake to do that to to not get people in the UK investing in these growth assets because We can fly to Boston, we can fly to America and get capital very easily. I mean, Canary Morse got a huge number of very large American banks who dominate a lot of the financing for these particular areas. so capital is there in the UK.' How do we kick started Like when I mentioned EIS, SEIS and VCT is all being tax invented cash at high Yeah. these are tax incentives for people m nudge a little bit over us saying, actually we should do this for some other asset classes as well. Sip for venture capital in series A said that is tax advantaged as well. So you start the It The scale up journey with a lot of UK capital already coming into the businesses. But why do we need that if you're saying the returns are good anyway? How many of you got of these investments What of the different tax ones? Yeah. Well I've got quite a few actually. So I use things like EIS and SEIS and obviously ICAS and things like that. But have a mixed portfolio. Everybody's going to have a mixed portfolio.. I think and that that gave you tax advantage pro which you went into You would not I'm saying these other ones through the pension schemes, which are tax advantage would be the same. butn't the more successful businesses in the world are investing in the UK in all of these projects. Increasingly, they're investing outside of London and the Glden triangle, but they're still mainly focused on those areas. If we want to revive the North and the northwest and the midlands and parts of the southeast and southwest to create a structure that makes that happen. Right now we don't have that structure. And I think it's too easy to say, well, you know my risk returns won't be good. Well, they probably will be good because there's so much catching up to do on terms of London. London's got the highest per capitar income of any city in Europe. Perhaps one of the Swiss cities is higher, but it's there or there about. Yes. Our second cities are miles behind. and they're miles behind you know Munich and Lele have higher per capabita incomes in Birmingham Why is that? Because they've got huge investment going into them for a very long period of time. Whereas we gnawed these other areas are massively deprived. From your perspective then, running legal in general when you did, you saw that there were returns there, but what made you run the business like that, I. e, you know, missing out the middleman, you know, missing out central government and going to local authorities and going to housing associations. What prompted that for you? Necessity, I think when you try for the UK to grow can't just have London growing and everything else growing at a pedestrian pace. and therefore When you sit down, and if I just took Newcastle at the moment, there's at least ten really good projects to be done in Newcastle. And they're just very slow moving at with the moment. Yeah Tell me about it.. I've seen that as trying to set up a business in Newcastle. It's just so slow with landlords and everything else and it can take forever Manchester, I think is an alternative to that is that they've done things much quicker in Manchester. One of the advantages Andy has is that he's seen that firsthand You know, our politicians tend to spend all their life being London centric. They do. And therefore, as a consequence, they have a conscious bias towards other places because you they've often they go and visit them when there's a crisis m rather than an opportunity. Looking at what's happened there and the support of Lgal and genereneral and others in Manchester, you can see the trajectory is much higher. Yeah. Manchester had the highest per capita income of any city in the world in the nineteenth century when the last technological revolution happened. and that was largely driven by people in Manchester but not by central R And manufactureuring and everything else thatving that Yeah. Yeah. And similarly, you know, the Northeast when they took off. and they sh building and everything else too of and you know, as I said earlier, you know just coming down and ask them White haall as opposed to engaging with commercial plantans. But they're all so big, you know I mean, legal in general lawn had one and a half trillion dollars of assets across the world. know pututting a few hundred million here there and everywhere is within its risk appetite. Um, and this just So many new projects need to be undertaken everywhere. Yeah And for you, that's the way we get growth across the country. So is so you know one of the things Andy Berhams came for given, you know his Manchesterism is this sense of, well, fiscal devolution, so more of the you know revenue that's generated there going into through taxes or whatever, going into the local area in the local Leaders deciding what happens with that money and what investments they make. There's that element of it. There's also the nationalization part of this or the state intervention. What are your thoughts on whether that helps or not? Well, it's not clear enough to decide right now will it help enough? But we're trying to increase the size of the pie, not sort of reallocate money that's already prohibive elsewhere. It's new money in new projects that will deliver growth, I think fixing the ownership between public private should only happen when there's catastrophes. I mean I regard Thames W as a catastrophe for the nation, sixteen million people have been impacted on that. Wh there's a complete failure, complete market failure where the government should step in. But where there isn't, they shouldn't be trying to fiddle too much with the economy, the focus on what's going to deliver growth and better outcomes from a societal point of view as to being this is our ideology, therefore we're going to privatize all the utility companies. Yeah. So I mean the argument from Bernon's side would be state intervention given that the people in the area would then decide what happens to it would redistribute or even redistribute wealth better because it's not like businesses who are just extracting wealth for like the top people. I'm thinking of miles off what really happens on the ground because when you do this investment, it creates real jobs. pay real wages and delivers good economic and social outcomes. I think that's the way to progress. Because science and technology will transform the economy. It will save us. It won't be the government who's going to save it. It's going to be science and technology, which is. Well it's not artificial intelligence now it real intelligence. We haven't really caught up to how clever these people are and how intuitive now they're getting and all of the wondrous things that we're going to see And at the moment, it's a lot of, you know, I'll call it generally AI, which is a horizontal, whereas it's vertical AI there you wouldn't go and ask, you know, Chat GPT or Claud Heck Please help me construct an EV autonomous vehicle. You might though. You won't do that because that requires all sorts of other skills to do that. And drug discovery is the same is that you will and have a very specialist verticalization of the sort of intelligence required to use compute. It's all going to come off the horizontals which are being developed here, but the actual verticals by sector are going to be very very different So you're saying real intelligence as in people. peopleeople are a part of that process as well, but using I hate the word artificial intelligent, but computing why? Because it's not artificial. it's you know real computing power.ot It's come from us originally. Yeah It's come from us and we're going to make the judgments on a lot lot of this stuff And drug discovery is going to be amazing. It's going to be, you know er vaccines, which we're beginning to show progress on already. Cervical cancer Cericalian cancer been at the leading edge, which is wonderful to see. But there's people working on how to do that in the future. Dmentia, which we're finally getting research going into that because they can do the research so much speedier and quicker now they before, so there will be dementia drugs successful ones in the next five to ten years, which are going to be better medication for the heart. because not only It stops you getting heart attacks, improves the heart on a go forward basis. You'll still have to do your hours in the gym and pumping iron and everything else. but the fat jobs are for that. But these are all known nns right now that these things are happening. and what we have in the UK is lots of IP There's no doubt we our best universities are among the best in the world, and our research facilities are amongst the best in the world we should be funding all that appropriately through the startup scale ups. and the students are coming out who are not going to find the jobs they thought they would have four or five years ago, we should encourage them to be entrepreneurs. They can't all be entrepreneurs, but we should definitely teach entrepreneurialism at university and at school and at school. Yeah and at school. So right the way through, you should be thinking of how I can self determine my success rather than sort of wander around at some millground or whatever. And lots of people want to do that because they're not buying a house earlier than're having children early. so their risk appetite for taking this on is much higher. And as a consequence of that, you and I should be doing more EIS and SES and VC and indeed following it through series sereries A, BC and D funding because there's going to be some wonderful opportunities for growth through science and technology. A lot of very clever people in the UK are going to make money out of that. I'd rather they made the money for UK pensioners and other savers as opposed to US equity and hedge funds. Nigel, I don't want to stop you. I've got laws of more to ask you, but let's go to a quick break This episode is brought to you by Vang Guard. Look, if you're listening to a podcast about finances, you likely already know that your money could be working harder. But we know it can feel overwhelming knowing where to get started and even dipping your toe into investing can make you feel out of your depth. It's a mindset that's pretty hard to shake without the right guidance. You might even find yourself wishing you could just get the pros to invest your money for you Well you can. With their managed ISEA, Vanguard's experts do the hard work for you. They'll match you to an investment plan that feels right for you and they'll handle the rest. No second guessing, just smart professional management. So stop wondering how to start investing and start making your money work harder. Search Vanguard managed ISA to find out more When investing your capital is at risk, tax rules apply. Hi, this is Garal Linia from Goldhangers, The restest is foootball. This episode is brought to you by Wise. It's only when you start moving money between currencies that you really think about the exchange rate, the fee and what might be hidden away in the small print Whether you're living abroad, paying someone overseas or just trying to manage your money across borders, you want a fair exchange rate and easy transfer and no surprises along the way. Wise keeps things simple. Wise is a smart way to move the currencies you need around the globe. It works in more than one hundred sixty countries and with over forty currencies Most transfers arrive instantly. Wise uses the mid market exchange rate, like the one you see on Google, with no markups or hidden fees. So when money needs to move, you can see the rate, know the fee, and get on with it. Join millions saving billions on hidden fees by downloading the WS app today. Be smart Get wise, teas and Ts apply This episode is brought to you by Street Easy. You gota ask yourself, W to talk about the time you lived in the greatest city on Earth or still live in it In the city where a matinee leads to two AM tacos Your New York era can last a lifetime. With twenty years of MYC know how, Street Easy can help you become a forever New Yorker. Visit streeteasy dot com to buy or rent in NYC. Street Easy is an assumed name of Zillow Inc, which has licenses in all fifty states Again, one of the things we've talked about is whether we should scrap tax incentives for cash ices and only give them four equity, you know, stocks and shares, ices. Yeah. What do you think about that? I totally agree with you. Right. agree with you. So you shouldn't be essentially rewarded for just letting your money sit there and earn interest. should be. You should be rewarded for UK investments. From nineteen fifty five to two thousand five, just before the financial crisis. The UK stock market slightly outperformed America. Yeah And as we went through the financial crisis, it had a massive impact on us. and there's been a huge divergence since that. Our productrouctivity has been flat. real wages have been flat in America' soord. They've poured capital into all of this stuff. They do it through our four hundred one K their pension plans. We're not having this discussion in America because they've passed it, they had that discussion twenty years ago And they know it works. They've got the amazing tech companies as a consequence. Lots of them failed That failure led to success because people learn from failures. in my life, I've made a lot of mistakes and I've learned from those mistakes. Be we don't you know Reward risk enough in a way, do we? And we don't celebrate. Yeah, yeah, celebrate. and also like you say You know, we were talking to the guy who was running the British businessus bank and about how We should that's the type of organisation that should be helping to invest and encourage more British startups or scale ups or whatever it is so we get more unicorn businesses. But public accountability and the fact that you know the nation will go wild if they think taxpayer money hasted been wasted on a failure, it's like I feel like as a country we are we're not good at assessing risk and we're not good at you know we think I't think that's true. Don't you? Because I feel likeete, the reason why people don't put that as much into stocks and chaairres and things. you know I'm talking normal domestic. agree with. Right right. then we finish my point and then you can argue why. I think that They feel like putting your money in a stocks and sres I set is the same risk of losing it as it is getting ran over if you're crossing the road. I think they think it's high risk because all the adverts say yourour money is at risk if you put it into and therefore it puts people off taking risk G on D disagree with me? I'm going to disagree because what happens is there are default funds in pensions And most of the money, over ninety percent of the money goes in the default fund. Y. And that's a construction that's made in partnership between the fund manager and the trustees Individuals making a choice on this, there's a relatively small amount, you know, less than ten percent that they're making. and they're making a choice. So by definition, they're happy to. taking more risk by making a choice because they're not relying on experts. That's a choice they want to make, you know. many of them pretty much track the index ones in there anyway. so That's been a very good investment for people to take over a long period of time. And so I don't think they frightened of doing it. They just don't know how to do it. I mean finiter you. Yeah ye. you clearly know what you're talking about when it comes to investment, which means it's no surprise that the government knocked on your door, didn't they a couple of years ago asking you to be a minister of investment, but you decided not to do it. I didn't.y Why did you not want to do it U P part of it was timing, you know, I was implementing tons of good stuff. And in the private sector the private sector. and across in thirty or forty cities, across the UK and I didn't want to abandon that project because these require a lot of pushing. You know, peopleeople just don say, come on in now Jo, you know smash all this amount and change all this and whatever. But they and therefore was the best option for me and indeed the country at that particular time. And so that's why. So you felt like they could do more in the private sector than you could in the public sector. And I had a huge balance sheet as well to help me out know because we'd raised you know enormous amounts of funds. was I wanted to influence policy as well, part in these areas, quite successfully on DC, less successfully on find to get soft compulsion in UK infrastructure and UK startups and scale ups, which I think would be the right thing to do So if Burnham came knocking, would you consider it now? Well he ticks more of the boxes because he's done the regional regeneration, which I think Having someone who really understands c what investments cities need to take for both the daytime economy and the nighttime economy. and lots of places are good during the day and not so good at night and are very good at night, not so good during the day. And so we need that's another dimension to all of this is how do we get more like London, you know, which is sensational an evening. The choice is just amazing and you feel as though when you wander around other parts of Britain, there's nothing like that because there isn't that wealth effect that we've got in in London. And I'd love to see that in in Newcastle and Sunder London, Sheffield and in Leeds and Manchester Birmingham, Bristol, Cardiff all ofdin Glasgow, all of these cities have the potential to be so much better. And there's nothing there shouldn't be anything stopping us because all the money is there. We just see some policy nudges and then all these things will happen because The graduates at the moment in universities want to be entrepreneurs. I mean I used to obviously bit of teaching when I was younger at university. and I still try and go back once a year somewhere and do at least one lecture And people want to be entrepreneurs. They want to And it's not just graduates, is it?s you know there's a lot of trades people in vocational training who similarly want to set their own companies. floods of requests for money from professors at various universities having met the five up North a couple of weeks ago and they were They were really good ideas as well. These were well thought through plans. but Where is the money, Nl was kind of the question for that? And I'm not quite in a position now where I can just say, Well, actually we've got this big fund over here. Don't worry, I'll come over there we can sort these things out And that has to change. Just on coming back to Bernam then, are you optimistic Now I'm optimistic because he's worked in central government and as a consequence that, he'll have learned a lot about central goovernment how it works and how important it is to get the right people in the right jobs. I mean, we had Steve Webb as a pension minister, super expert on pension. first one, know nobody else thought so boring. whyy would it bother? But that really matters getting you the right people in the right slots across government And he's done quite a few jobs in government, which again is very useful, includluding working with the Treasury and health system and culture But he's got he's deeply embedded in regional economics as well, which is the first time I can remember anybody having that particular skill and that's what we to catch up on science and technology. that's the only thing. but again there's some brilliant people in the UK who understand all that and can really help. I think the government navigate a call through that because We've entered a marathon for science and technology. and we're about fifteen meters into. And know America's pulled away in, China's not far behind, but we're best in class in Europe Yeah. No doubt. we have the best tech base in Europe. forty two percent of all VC capital comes into the UK across Europe. So we've got more than France and Germany combined. You can't say that about many industries. So the preconditions for success are all there. and they just need nudging and Hopefully, the Labour Party won't waste time on massive ideological discussions, which the first year of the last government, I think that's where we went wrong. Let's go along the growth agenda and it didn't. and instead they went on the ideological agenda. You've got to do it the other way around. You've got to get the growth first, then to get the ideology implemented and create wealth so child poverty, health inequality, all these issues I know you care about too can be improved. Yeah. And so just on your point as well about that having, you know you mentioned Stw Pensions mininister, having that expertise because that's felt that it has been lacking again in this government The Chancellor's role' going to be important.. Do you have any thoughts on who you think should be Chancellor then? No, I don't really have thoughts. I think you know Rachel this year has done a really good job. D? Yeah. why? It's very hard to judge people in the moment because the media has a backward looking view on what's happened. But I She started a lot of regional initiatives herself and those are beginning to make progress and so they're heading off in the right direction I wish they'd done that eighteen months ago rather than start to do it now. Yeah. You know, they've got Tom Reien, who's did an amazing job in Leeds heading up a large part of that. and that was the right thing to do. But he's now in the north empowered to get on with stuff, which is the right things. it was auseed to trying to work in White Hall, which is complicated and difficult and Not many people have succeeded and they get parachuted into those sorts of roles. and Jim O'Neills come in as well. as another you know commercially minded individual that just started to get that stuff done, but it's not as visible. But people remember you know what happened in the first place Be there were huge tax rises, you know, the black hole was brought up even though we all knew that there was a black hole. thenen there was the you, massive tax rises for business, national insurance contributions, minimum wage going up. I mean, as a business person, trul really, you must have thought, hang on That's why Iopp didn't work with them Like lots of other people quite let down by people I like Kia and I like Rachel, but they went off in the wrong direction and didn't take anybody with them. and the business community was pretty fed. Well they've been pulling it back recently is what you think? So maybe we didn't give them enough of a chance. The preconditions for success in the UK are pretty good and we can self determine our success. It's not like we We absolutely need to borrow gazillions of money from the world's capital markets But we can if we want to, because all the biggest banks in the world are here. All the biggest P VC funds are either here or coming. US tech is flooding into the UK because Our people are much cheaper. than in the United States. And so there's some very positive things already happening. but you've got to ride that way. Blair and Brown got very lucky in nineteen ninety seven because Major and Clark had did an amazing job of turning around the economy. and so people The inheritance was good. The inheritance they had a four percent growth. unemployment was going down, inflation was going down and a budget surplus we have one hundred thirty billion pounds per ann budget deficit and three trillion of debts, and we had three hundred million. So the debt's gone up ten times and we' gone from a surplus to a massive deficit. So the In a sense, we' wasted a lot of government expenditure not delivering growth. What we need is partnerships with the government so they don't crowd out all the private capital that's available. One of the reasons why the inheritance has been so bad for this government is still the after effffects of Brexit and how much that's cost the UK economy. What are your thoughts on leaving Brexit? I mean, we're ten years now from the referendum Yeah I was I sat in the Prime Minister's Business addvisory group at the time, and I was the only person on that committee who thought we might lose And actually Brexit was going to happen because I spent so much time in the regions running around. You you spent time in the Northeast like me, so you knew what people were saying on the streets. No one was listening to us. No yes.. Yeah. this is what was coming about. Even Beckonfield, which is where I lived at the time. that voted to leave. And we had the white hole bubble in effect, and that was that on the Westminster, whatever you want to call it, buble and it was very insular around all that sort of stuff. And I did, you know Cameron really wanted to do it because Blair hadn't done it and they absolutely expected to win. and they didn't work hard enough trying to win in my view. And what I said at the time, I said I thought it would cost us about half a percent of GDP growth every year for almost forever tntil we reengage with Europe. And I think We need to re engage with Europe and much more than we're doing right now. and you know, student visas and stuff like there's some easy wins that we can we can get right now and make it happen because They are a very important trade partner. all the tourism, all the health issues, all the university type of issues We should begin to open doors and again, doors lead to doors, but if you pull out, it's hard to get back in Yeah. so do you think then there's a case for was trying to form some I mean, we're not going to go back into single market, but do you think we should or I mean maybe we'reill who knows things change on a daily basis now. But what are your thoughts on how we make that relationship then with the EU? I think would heading in the right direction with Ka because he chared a lot of the G seven meetings very involved with. It's good news now though? Yes. But that's created a precedent that we hadn't had before because clearly we've had people who were pretty anti Europe and Europe should be seen as a strong partner for us on a go forward basis However Point one is self determine our success using all the capital that we have here in the in the UK and reform pensions and where necessary cash isices and other things to help really drive growth focus on the regions as well as London. Yeah. It's a real thing I admire in you is this view and this focus on the regions and how much they can do and the fact that it's not a charity case. it's actually a genuine investment opportunity. Everywhere I go, I'm obsessed about why things haven't changed, why there's been very little pro whether it's as you walk outside of Sheffield station where's Nor development or whatever and they've been talking about it for twenty years. Swinden station exactly there exactly the same. and go to Bristol, there's large areas which need transformation. York Central has been talked about for twenty five orty thirty years, Stevenon area in Newcastle is the same. You just massive under development very long periods of time and this has to change. and I'm hoping that Andy is the right person to lead the charge on that, but not talk about it. It's got to be it's gott to be a doing and don't do DAaf things, VAT on independent schools and the NI situation, which are just Yeah, the national insurance. Yeah just not good ideas. Yeah. We've heard him potentially say he might roll back on the national insurance contributions Well, he's got to look at the books very carefully. I think there's already a lot of very optimistic forecasts. I mean at the moment The government expenditures about one point three five trillion And they get about one point two two trillion as receipts. So there's a deficit of one hundred thirty billion. On top of that, this you'll find out, there's about one hundred fifty hundred sixty billion of Gilts need refinancing every year. And the Bank of England selling about four hundred. So there's two hundred fifty billion to three hundred billion of Gilts to be sold every year That's a massive issue. that's eightcent to ten percent of our GDP. We used to think two percent was the upper limit. But we're we' that's going to be it It problem that'll need some clever people around him to figure out how that's are we going to manage that situation. Very much every decision a politician makes, the markets make a judgment on it and that can be really tough when you If you want to bring in big change, if you can't prove straight away it's funded in the way that the markets are happy with, suddenly your borrowing costs are much more expensive I would be trying to persuade the Bank of England to take rates down to be more like Europe. So bring down the base rate there you think. Because I think we've got enough progress to what moreant takes. Doot not worry about inflation? Well there's no causation between interest rates. agree with you? I think monetary policy is totally outdated. is out. Yeah. But no one ever agrees with me when I say that. Robert always says to me, right, okay, do you a little rant about monetary policy not working. That's true It is true. And we know thatations global. It's global'sogeneous. But people weren't taught that and the banks only got one average point which is and so they fiddle about with it. don't and it punishes them. punishes them as they put up rates, one because the treasury has that indemnity, you remember, which has to pay over money to the Bank of England that if rates go up, the cost of that goes up, and it's already in huge deficit And secondly the biggest borrowers by miles in the UK are the UK government, so they're punishing themselves. So just to wrap things up then, what would be advice for Burnham? I don't think you'll need advice of me because I think he's already there on lots of these issues. I think the key thing is to get people around you, you know And and politicians often make trade offs between who they appoint for all sorts of different reasons and they get wrong people in the job. In business, you don't do that. In professional sports, you don't do that. know you want a winning team and you construct a winning team around that. Wh did you think they're too diplomatic and how they do it or something? R than just drinking. I think it's political and trade offs too often happens and there's compromises made when You need you know real specialists in each of the areas who are going to drive through what is required across the UK. Right, Nigel, I should let you go. Thank you very much for your time. loveovely to have you here. But that's it for me on the rest is money. Bye bye Your package says deelivered, but delivered where exactly? The hallway, the lobby, your neighbor's apartment? Instead of playing detective with your deliveries, get a mailbox at the UPS store. We'll sign for your packages. Text you when they arrive. and keep your deliveries low key. Under locking key, get three months free mailbox services with a new annual agreement at the UPS store For full details and to get your coupon, visit the UPSstore d. com slash offer