A comment by Sarah Forster – CEO, The Good Economy
“Andy Burnham’s speech took me back to my work in post-war Bosnia, in mayors’ offices, discussing the role of municipal bonds in financing reconstruction. My focus was institution-building: creating sustainable microfinance institutions for low-income people and small businesses, and strengthening local governments with the fiscal powers to fund their own priorities. Different countries, same underlying question: who has the capacity to turn capital into something lasting?
I returned to the UK and joined the New Economics Foundation, whose 40th anniversary I had the pleasure of celebrating this week. I’d become disillusioned advising other countries on alleviating poverty when our own had entrenched poverty, regional inequality and is one of the world’s most centralised. I worked on community and municipal finance and social investment. I’ve always believed in devolution but it needs to come with fiscal power.
Burnham’s “No 10 North” adds fresh energy to a devolution agenda that’s well underway, including embedding long-term, integrated regional strategic planning – the topic of a roundtable this week at The Good Economy Partnership Limited. But the real test isn’t whether power or capital moves out of Whitehall. It’s whether local institutions have the capacity to mobilise and deploy that capital in the long-term interests of local people and place.
Even with greater fiscal devolution, locally-generated finance won’t match the scale of investment needed to tackle the UK’s entrenched regional inequalities. We know plenty of people inside financial institutions who want to invest in ways that support local places, but struggle to find the right local partners to work with. As this more devolved system takes shape, designing in the needs of that group will be critical.
Prosperity isn’t simply a function of growth: it depends on institutions built to last longer than the funding round or reorganisation that follows. Every place has its own context and needs. That’s why starting local matters: strong local economies are the bedrock of a resilient good economy.
Getting there needs clear local strategies, credible investable pipelines, expert implementation, and impact measurement that goes beyond measuring growth. Growth is meaningless if it doesn’t deliver what matters: homes, good jobs, quality public services, local energy and food security, and local economies strengthened as a result of investment.
This is where The Good Economy works: we sit at the intersection of policy, investment and impact, building trusted connections between local government, pension funds and the intermediaries that make investment happen. The next phase of place-based investment will be defined not by who can mobilise capital alone, but by who can make capital work in places, credibly, accountably and with evidence of real world outcomes.”
