Labour: North and Midlands miss out on support for start-ups as it is revealed Ministers have invested five times as much in the South
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New figures have revealed that London and the South East have
received five times more funding from the Government for start-ups
than the North and Midlands. Businesses in the South East and
London received in total more than £700m in funding, while
businesses in the North, Yorkshire and Midlands received £140m in
total – around five times less. This discrepancy is even starker
when compared to the population, with 18 million people in the
South East and London compared to...Request free trial
New figures have revealed that London and the South East have received five times more funding from the Government for start-ups than the North and Midlands. Businesses in the South East and London received in total more than £700m in funding, while businesses in the North, Yorkshire and Midlands received £140m in total – around five times less. This discrepancy is even starker when compared to the population, with 18 million people in the South East and London compared to a combined 28 million in the North, Yorkshire and Midlands. The ‘Future Fund’ aims to support pre-revenue, pre-profit innovative businesses affected by the covid crisis that are normally reliant on equity investment, but the figures reveal startling regional inequality both in the number of businesses supported and the average size of loan. The average award for a business in the North East, North West, West Midlands and Yorkshire was much lower – in some cases by hundreds of thousands of pounds - than the average award for a business in London or the South East. In Scotland the average award was just a third of the national average and in Wales half the national average. The approval rate for applications from the North West, Scotland, Wales and the West Midlands was also substantially lower than the high 84% approval rate for applications from London and the South East. However with two thirds of applications for the Future Fund coming from London and the South East, the figures also shine a light on economic inequalities - and the failure of government to help create the right conditions for innovation outside of the South during more than a decade in power. Ed Miliband MP, Labour's Shadow Business Secretary said: "While the Government talks about backing the North and Midlands, the reality is starkly different. Their interventions are making regional inequality worse not better. “By investing much more heavily in start-ups in the South of England and squeezing out other parts of the country, they will be simply reinforcing economic imbalances in our country “Ministers have already hurt hard-working entrepreneurs during this crisis by excluding them from support. Instead of hot air and rhetoric, it is time for ministers to deliver." Ends Notes to Editors
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