Kick-start the engines of growth

As

went to press Gordon Brown was in the early stages of an energetic tour of the UK, taking his Cabinet with him in what must be one of the most intense blizzards of senior politicians to hit the nation's regions outside of a general election period.

As the PM steamed into Derby to visit Rolls-Royce his business secretary, Lord Mandelson, was meeting representatives of the aerospace industry.

We should at least be thankful that our major engineering and technology-based industries are getting all this attention from the great and the good.

Maybe the invitations to grand lunches in the City of London have dried up somewhat, or perhaps the politicians are steering clear for a while.

However politically symbolic it is supposed to be, the government's regional roadshow deserves some credit for identifying where the battle for economic recovery will be won or lost.

As the pot of tax revenues from the City dwindles, the government knows that growth in the UK's nations and regions will be vital to providing the impetus we need.

Mandelson — who often sharply divides opinions, to put it mildly — is surely right when he identifies support for smaller, innovative businesses as the big challenge facing those regional agencies responsible for dispensing public funding.

Indeed, he goes as far as to declare that this should be the 'defining role' of the regional development agencies.

It is interesting that even in the midst of what could charitably be called an uncertain climate for private capital (lots of people can't get any), many people react with instinctive horror at the prospect of public funding being used to back entrepreneurial ventures in the engineering and technology arena.

Their argument is that the market should take the leading role in picking 'winning' companies and technologies, lest public cash be wasted on the half-baked and the hopeless.

But if the market is in a bit of a mess, where else can entrepreneurs turn other than public coffers, whether regional, national or indeed from the EU?

Support does not have to mean direct funding. It is far more likely to take the form of commercial advice or training, filling in the gaps in expertise of the entrepreneurs themselves.

In parallel, the government should spare no effort to kick-start those sources of private capital — getting the banks to lend again would be a good start.

Here is the most vital point of all. Engineering and technology-related sectors should get first call on whatever assistance is going.

Regional bodies should ruthlessly and shamelessly discriminate in favour of the technology-led. If a company developing an innovative technology in, say, the north west of England grinds to a halt, its competitors in South Korea or Finland may still be going strong. A year of stalled progress could mean an opportunity lost for a business, its region and the UK as a whole.