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Growth requires the courage of all

By Colin Bell, Business and Sector Growth Director at the North East Local Enterprise Partnership


Last month the Office for National Statistics released the latest business count for the UK. Unfortunately, they told an all too familiar story for the North East. We still rank bottom and our low levels of enterprise continues to be a major drag on our economy.  

In the North East only 332 private sector enterprises exist per 10,000 adults, compared to 483 for England excluding London. If our rates matched the English average there would been almost 25,000 additional enterprises in the North East, generating 200,000 additional jobs and providing a £10 billion boost to the economy.  

The underlying aspiration is there. A study by SME Loans highlighted that 55.6% of the North East’s workforce would like to start their own business. 43% however instantly write themselves off, believing that they couldn’t pull it off, and only 1% take the plunge and start their own business.  

Imagine if we could change that 1 % to 10%; the transformation would be huge and felt by everyone. This isn’t just an economic issue, it’s a social and an environmental one too. It’s my belief that start-ups and small enterprises are central to enabling social mobility; providing opportunities to people who just could not access them through big corporates or institutions. And the innovations that will save our planet will originate from small disruptive businesses – enterprise is a force of change and a force for good!   

The big question is, what can we do to encourage more people to start their own enterprise?  

A good starting point is to focus on what’s holding them back. Fear of failure and the consequences that this will have on livelihoods, finances, family, careers, childcare and wellbeing holds back 42.7% of our aspiring entrepreneurs. The cost-of-living crisis will only see this grow. 

Tackling these deeply engrained and often cultural causes of low enterprise needs to be a focus for future interventions at a local, regional and national level. Policy must be designed to grow confidence and reduce the fear and associated risks of failure. The fear of not doing it needs to be greater than the fear of doing it. 

Continuing to do the same old things and expecting different results will simply no longer cut it. All eyes are on our new growth-orientated government and the role entrepreneurs and small growth-orientated businesses will play. What bold and transformational policies will be championed by The Rt Hon Grant Shapps MP, the newly appointed Secretary of State for Business, Energy and Industrial Strategy. And how will new domestic funding streams such as the UK Shared Prosperity Fund better target the causes of low levels of enterprise?   

The North East LEP’s Business Growth Board is clear. Bold action is needed, we must move away from the current confused, transactional, grant-led and tick box approach to business support, to one that is focused on tackling the real underlying causes of low levels of enterprise, productivity, and growth.

The opportunity is there, what is now required is for decision makers – like our aspiring entrepreneurs – to have the courage and foresight to step over the line and lead the change.  

Colin Bell is Business and Sector Growth Director at the North East Local Enterprise Partnership.

Entrepreneurs and business owners looking for help and support to start or grow a business can access free, impartial advice by visiting the North East Growth Hub.

See the latest data on businesses in the North East – including business counts and information on high growth businesses – on the North East Evidence Hub, the region’s one-stop-shop for data and evidence: www.evidencehub.northeastlep.co.uk/businesses.

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Economic prosperity and cost of living are focus for North East LEP’s Our Economy event

Expert speakers from The Institute of Directors, CBI (Confederation of British Industry) and the Resolution Foundation will join the North East Local Enterprise Partnership (North East LEP) on Tuesday 15 November to discuss economic prosperity in the region and the cost of living crisis as part of the North East LEP’s annual Our Economy event.

Looking at the current performance of the North East economy and how it’s developing over time, and key national and international issues impacting the region; Our Economy has been expanded in 2022 and returns to an in-person format at Crowne Plaza Newcastle. 

This year’s event will focus on how the economic gains in the North East from 2014-2020 have been impacted by recent economic shocks, and the prospects for prosperity for the region’s business and residents.

Kitty Ussher, Chief Economist at The Institute of Directors; Mohammed Jamei, Director of Economic Projects at the CBI; and Mike Brewer, Deputy Chief Executive of the Resolution Foundation; will join Richard Baker, Strategy and Policy Director at the North East LEP, to discuss living standards in the region and the trends for incomes, wealth and poverty for residents; and how the environment for business is changing and what the prospects are for investment, business growth and employment.

Lucy Winskell OBE, Chair of the North East LEP, will open the event and host the panel discussion.

Lucy said: “Each year the North East LEP uses data gathered from the North East Evidence Hub to present the current economic outlook in the region.

“By gathering and using data, evidence and knowledge in this way, we’re able to inform strategic economic planning and work with political and business leaders to inform decision making. 

“This kind of evidence-based approach is essential; particularly in such turbulent economic times.” 

Our Economy 2022 will explore what the future holds in the economic and financial environment, and what this means for prosperity in the North East. It will also consider what can be learnt from responses to previous economic shocks as residents, businesses and institutions navigate their way through the current cost of living crisis.

A series of in depth, expert panel discussions will take place following the main Our Economy event to explore some of the themes and issues raised. Topics include evidence and data; business – discussing what the evidence means in practice; people – the implications of the cost of living on people and communities; and emerging markets.

Richard Baker, Strategy and Policy Director at the North East LEP: “We’ll be asking leading economists from the CBI and the Resolution Foundation for their insight on living standards and the costs and wider environment for doing business. 

“Understandably there are real concerns about net incomes and current living standards for residents as well as significant challenges for business resilience. 

“Our Economy 2022 is an opportunity to debate what we can do in the region to help drive forward at this time of uncertainty.” 

All the evidence and data presented as part of Our Economy 2022 will be available on the North East Evidence Hub.  Our Economy 2022 takes place on Tuesday 15 November from 9am at Crowne Plaza Newcastle.

Tickets are free and can be booked by visiting the eventbrite page.

For more information about the North East Evidence Hub, visit evidencehub.northeastlep.co.uk.

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In conversation with Rhona Knox from Procter & Gamble (P&G) about innovation in the North East

Rhona Knox is R&D Vice President, Global Fabric Care Sustainability, Dry Laundry, and head of the Newcastle Innovation Centre at Procter & Gamble (P&G). Originally from Dunbar, Scotland, Rhona came to the North East in 1993 on an internship with P&G and has worked at the company for more than 28 years.

What is it about the culture at P&G that’s led you to stay at the company for such a long time?

At P&G, our culture is rooted in the idea that we can make people’s everyday lives a little bit better through our products and brands. Playing my part in delivering on that mission is one reason I’ve stayed for such a long time. After all, if I asked you what you did this morning, you may tell me that you’ve brushed your teeth, washed your hair, put clean clothes on or cleaned your house. So already, the work I am doing at P&G has touched your life in many different ways. Having that tangible impact on wider society is really important to me.

Working at P&G has also enabled me to live and work all over the world – all whilst doing some really interesting assignments, despite working for the same company. For many of my friends, getting that variety has meant having to change jobs multiple times, so I count myself really lucky.

What does innovation mean to you?

Innovation is at the heart of everything we do – our products, our services, our capabilities – because it enables us to continue to evolve and improve in ways which we believe will make a different to people. It helps us to solve real problems through experimentation. That’s something I’m fortunate enough to be involved in each and every day. If I don’t get it right first time, that’s okay – I learn from it, safe in the knowledge that I’ll be closer to getting it right next time. As a company, we place a huge emphasis on adopting a growth mindset – embedding a culture of learning as opposed to always getting the right answer first time around – and that is crucial to innovation.

A great example of how we’re continuing to embed this philosophy is through our ‘failure panels’, which were introduced by someone in my team. They’ve done an amazing job – providing an opportunity for everyone to share their experiences related to things that haven’t gone right first time. They’re so important because they remind people that failure should be accepted and embraced, whilst providing all-important learnings to carry forward in the future.

Where do you think you’ve innovated most in your career?

I’m really pleased that I’m still able to do some hands-on work and, whilst that might not be in a laboratory, it’s still focused on creating new ideas and developing solutions.

If I think about a situation where I’ve been at my most innovative, I’d say that it’s probably been in scenarios where my team ave been seen as the underdog, i.e. the challenge is high but the chances of success are acknowledged to be relatively low. It’s made me my most innovative because it gives you a lot of freedom to really experiment and try new things, knowing from the outset that nobody really expects you to succeed.

I’ve also found that I’m particularly innovative in cases where I haven’t had a huge budget for my work, because it requires you to put more thought into where and how you use the little resources that you do have. I believe that necessity is the mother of invention, so it isn’t always great to have lots of money at your disposal. On the other hand, there are times where it can make a big difference, particularly in the scaling phase.

You’ve worked all over the world. Is there a similar approach to innovation or does it change in different places?

I think there are nuances. In China, for example, there’s a huge appetite to experiment, whereas generally in the West a lot more planning is applied. And I think there’s probably a sweet spot between the two – both have their merits. Ultimately, there isn’t a perfect model for innovation – so my advice would always be to pick what you think works best, based on your experiences, and to try to bring those things together.

How important are people in innovation?

Innovation is absolutely a team sport; people are such an important part of my job. Yes, everyone can name the great inventors who are all individuals, but I find it hard to believe they truly did it all by themselves. And it’s not a model for today. Productive, meaningful innovation is reliant on bringing together bright, diverse teams to solve complex challenges, because it means you’re able to incorporate all manner of knowledge and experiences to reach a solution. That’s why, as a company, we’re particularly passionate about increasing gender diversity in STEM fields.

What were your impressions of the North East after moving back to the region?

I was working in Singapore before I came back to Newcastle. The P&G site in Singapore is based on a purpose-built Bio Innovation Hub which has some very high-tech buildings. There’s been a huge amount of investment there.

Before I came back to Newcastle, I thought that major innovations would take place at a specific site, as opposed to happening all across the region. Once I’d returned, I found that the old Newcastle brewery site had gone, and that there was a huge amount of work underway to create what is now Newcastle Helix – one of the biggest innovation hubs in Europe. It’s great to see that the whole region is continuing to reinvent itself from the days of heavy industry, with the skills of people across the North East being used to create new science and new innovation. It’s really transformed to become a modern, high-tech hub, which is great to see.

What are your ambitions for the future of the North East?

I’d love to see more big organisations, like P&G, come to the North East, helping to continue to scale up our innovation and manufacturing capabilities. I think the region’s desire to create is very strong, and we no longer need to focus our energies on coal or heavy industry. Today, we can look to biotech or harnessing the power of technology more broadly – creating a clean, manufacturing epicentre for the future.

In addition to attracting existing corporates to the region, we should also ensure that we’re growing the smaller companies that are already in the region, so that they’re able to become the big corporates of tomorrow.

Learn more about the health and life sciences sector in the North East.

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North East LEP reaction to Spring Statement 2022

“Against a very challenging backdrop of rising costs for people and businesses, and declining growth rates and living standards, Chancellor Rishi Sunak’s announcements will help relieve some of the pressure in areas like fuel prices and employee costs, and local authorities will have more money to help vulnerable people. He also announced spending to support small businesses with employment costs and business rates, which we welcome.

“However some of the big investments which could have accelerated growth in the North East will await the Budget. We also expect to see more detail on regional policy issues, including detail on the UK Shared Prosperity Fund, later in the year.

“We look forward to learning more about the planned consultation on areas including skills support, the apprenticeships levy, innovation performance and capital allowances for investment. These are important areas for focus if we are to see sustained long term growth.”

Richard Baker, Strategy and Policy Director at the North East Local Enterprise Partnership

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How international students help create a more prosperous North East economy

By Jane Robinson, Pro-Vice Chancellor, Engagement & Place at Newcastle University


The North East is home to some of the best universities in the world, and because of our global reputation we welcome thousands of international and EU students every year.

In the 2018/19 academic year 12,595 international first year students came to study in the North East, and a new report by the Higher Education Policy Institute and Universities UK International has looked in detail at the benefits international higher education students bring to both the UK and regional economy.

The report shows the 2018/19 cohort of international students in the UK delivered a net economic benefit to the country of £25.9 billion. In the North East LEP area, the total net impact on the economy was just under £1bn (£975.9m).

In fact the North East region, including Tees Valley, delivers one of the highest average impacts per parliamentary constituency in the country; an estimated £460 per member of the resident population, second only to London and on par with Scotland. Newcastle upon Tyne East is ranked fourth in the top 20 parliamentary constituencies in terms of the net impact international students have on the economy.

The UK’s exit from the European Union and the coronavirus pandemic has undoubtedly created barriers for international students to study in the UK, something that is reflected in EU student recruitment, which is currently lower than in 2020. International student numbers have, however, stayed relatively stable in the 2020/21 academic year.

Whilst the findings in the report are extremely positive for the North East region, it fails to include is some of the other important indirect benefits international students bring to our regional economy, such as tax revenues, investment and trade links, and the soft diplomatic power exerted on an international stage as a result of the networks built up during their stays.

We only need to look at the hugely successful alcoholic tea company NOVELTEA, which was founded by two international Newcastle University students in 2016 to see this in action. Based in Newcastle, the company has expanded into several international markets – including Germany and China – and plans to create further jobs as it eyes expansion into the US. By choosing to remain in the North East to grow their business, NOVELTEA’s co-founders, Vincent Effroth and Lukas Passia, have created new jobs, boosted the North East economy, established positive trade links and raised the profile of our region internationally.

Newcastle University’s START UP programme is also supporting and endorsing ambitious international graduates to remain in the UK to start and grow businesses. Four of the programme’s graduates have been accepted onto the Department for International Trade’s (DIT) prestigious Global Entrepreneur Programme (GEP), which connects companies into the global ecosystem and supports them to scale their solution to address global opportunities. The partnership between START UP and GEP allows highly motivated, talented entrepreneurs to thrive in our region and add significant value to both the regional economy and UK PLC.

The Higher Education Policy Institute and Universities UK International report focuses solely on the economic benefits international students bring to academic institutions and destinations, but I think it’s important to remember the North East benefits in a number of other ways too. The wider cultural and societal impacts are just as important to our region.

At Newcastle University alone we have over 150 nationalities represented on campus, and that diversity helps create a more vibrant and creative environment for all our students.

We’re seeing many international students remain in the North East after their studies to take up skilled positions in our emerging sectors, or start new businesses of their own, which go on to employ people and contribute to our local economy.

If we think about the North East’s strengths in data and digital, life sciences and the green economy, as well as our cultural and creative opportunities, the global links we’ve established through our international students can create opportunities for North East businesses to attract talent and investment.

I also firmly believe our UK students enjoy a better learning experience because of the diversity on our campuses. It’s a chance for them to build connections across the world that can open up a world of opportunity.

The report makes for fascinating reading, and further demonstrates the essential role universities in the North East play in delivering a stronger North East economy and a vibrant and diverse place to live, work and study.

To read ‘The costs and benefits of international higher education students to the UK economy’ visit www.hepi.ac.uk.

Home / Economy

New reports on North East economy reveal impact of COVID-19 and EU Exit

The North East Local Enterprise Partnership has published two new reports, one, an annual state of the region report and the other exploring the impact of COVID-19 and EU Exit on the North East economy.

The LEP’s annual Our Economy report has been published in two parts in 2021. The first report tracks the long term performance of the North East LEP economy across a range of key economic indicators and provides an overview of how it is changing over time.

It also includes an update on progress towards the North East LEP’s aim of bringing 100,000 more and better jobs to the region by 2024, and analysis of the impact of emerging policy priorities, like levelling up and decarbonisation, on the North East.

The second report provides a comprehensive and in-depth look at the national and regional data, research, insights and commentary that shows how COVID-19 and EU exit has impacted the regional economy. Drawing on a range of additional and innovative sources of data, ‘Our Economy: Insights into the impact of COVID-19 and EU transition on the North East Economy’ gathers intelligence on the impacts of the pandemic and EU exit on the North East economy from March 2020 to the current day.

Lucy Winskell OBE, Chair of the North East LEP, said: “This year, perhaps more than any other, developing our shared understanding of change in the regional economy is crucial.

“The work we have done to track, analyse and interpret data and evidence about the performance of our regional economy is central to our role at the North East LEP and a core part of the support we offer our partners.

“It is integral to our economic leadership, our influencing work with government, and underpins our investment decisions and stewardship of public funds, ensuring that regional programmes of delivery are targeted at addressing the key opportunities and challenges we face.”

The reports state that whilst the short-term impact of COVID-19 on the North East was highly disruptive and challenging, the region has continued to sustain increased levels of employment compared with its baseline in 2014, with continued growth of the proportion of better jobs – managers, directors and senior officials; professional occupations; and associate professional and technical occupations – in the region.

They also show the impact of COVID-19 on business and the labour market has been significant. Some sectors, including retail, culture and hospitality, have seen severe changes. Local, regional and national intervention has had an impact in protecting businesses and jobs, but the impact now many of these support measures have ended is unclear.

Inequalities within the region have been exacerbated by the pandemic too, with employers in many industries struggling with skills shortages.

The reports also include data showing that the region’s engagement with the global economy is changing, with the impact of EU Exit creating barriers to trade and the future trading environment still evolving.

Our Economy 2021 also looks at the performance of our programmes and sectors – which have been identified as areas of opportunity for the region, including health and life sciences, digital and energy.

Richard Baker, Strategy and Policy Director at the North East LEP explained: “The economic shock has accelerated a number of opportunities for the North East, with growth and new jobs in some of the key areas of strength and opportunity we have been focused on – in energy, life sciences and digital industries for example.

“Many firms across the economy have changed their operational models, with rapid deployment of digital technology, changing approaches to delivery of goods and services locally and growth in online exporting. There are genuine opportunities for the region to drive forward greener businesses and to drive productivity.”

The evidence provided by Our Economy is used to inform the work of the North East LEP and partners across the region in delivering the North East Strategic Economic Plan – the roadmap for increasing economic growth in the North East.

Our Economy 2021 is available to view on evidencehub.northeastlep.co.uk.

Our Economy: Insights into the impact of COVID-19 and EU transition on the North East Economy is also available to view on evidencehub.northeastlep.co.uk.

The North East Strategic Economic Plan can be read at northeastlep.co.uk.

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North East Local Enterprise Partnership reaction to ONS regional labour market statistics

The North East Local Enterprise Partnership’s (North East LEP) Strategy and Policy Director, Richard Baker, has commented on today’s regional labour market statistics, released by the Office for National Statistics (ONS)*.

“The latest data covers the March to May period, during which some COVID-19 restrictions were eased. Despite these changes, the overall labour market picture remained relatively unchanged on the previous (December to February) quarter with both the employment and unemployment rates remaining the same. 

“The North East continues to have the lowest working-age employment rate (72.0%) among the nine English regions and the second highest unemployment rate (5.8% of the economically active). The region also has the highest proportion of people who are economically inactive (23.6%).

“ONS continue to innovate with new data approaches to provide more up to date intelligence to support assessment of the economy, for example, a new experimental measure of payrolled employees. This suggests a more positive picture with the latest monthly estimate showing there was an increase of almost 12,000 payrolled employees in June. This is encouraging and we will monitor how this new data set develops given it is subject to revision and excludes information about self-employed workers.

“Beneath the general figures, COVID-19 continues to have an impact on the working lives of many people in the North East region and appears to be exacerbating inequalities. Whilst people were securing new jobs and there is growth in vacancies, about 4,400 workers experienced redundancy in the latest quarter, more than twice the total in the previous quarter and bringing the total to over 32,000 since March 2020. The latest data shows a particular impact on women in the North East with female employment falling by 3,600 in the latest quarter, in contrast to a 2,800 increase among males.

“Job seekers claimant count data provides indications of the variations of unemployment within the North East LEP area. At constituency level, the rates range from 2.8% in Hexham to 9.0% in South Shields.

“At the end of May, almost 63,000 workers in the North East LEP area were still furloughed, with workers in food and accommodation services still making up almost a quarter of this figure. Manufacturing accounted for 11,000 of the furloughed workers, a total that did not drop during those three months. 

“This provides a strong rationale for the ‘Levelling Up’ agenda with support needed to the North East as a whole and for places within the region. Over the longer term, our Recovery Plan sets out proposals to drive forward our vision of a more sustainable, competitive and inclusive regional economy. As the Prime Minister outlines the next steps with for the Levelling Up strategy, the North East LEP will continue to work with Government and our partners to provide support to our regional economy as we work through the recovery phase to seek investment into these proposals.”

*The official data released today includes employment information based on surveys in three month period March to May 2021 for the North East region, which includes the North East and Tees Valley LEP areas. It also includes experimental estimates of payrolled employee numbers and job seekers claimant count numbers for June 2021. The regional data has been revised to take account of improved population estimates.

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Queen’s birthday honours recognition for North East LEP chief executive Helen Golightly

One of the region’s most respected leaders has been awarded an OBE for services to business and the regional economy.

Helen Golightly, chief executive of the North East Local Enterprise Partnership (LEP), has been recognised in the Queen’s birthday honours list, which marks the achievements and service of extraordinary people across the UK.

Under Helen’s leadership, partner engagement with the North East LEP and the region’s Strategic Economic Plan has helped deliver over 71,000 jobs since 2014 the employment gap between the North East and England (excluding London) has reduced by 26%.

Helen has been instrumental in securing over £2billion investment for the region, resulting in the delivery of 140 capital and 40 revenue projects securing 20,000 more jobs for the region.

The Coronavirus pandemic has seen Helen play a leading role in the region’s response, bringing together the public, private, education and voluntary sectors to form the North East COVID-19 Economic Response Group. The Group’s work secured region-wide support for a staged recovery plan to build confidence, stabilise the economy and help businesses adapt to the new normal.

Helen has been Chair of the £120m North East Fund since its inception in 2016 and helped design this important access to finance initiative to ensure SMEs could raise the start-up and growth capital needed. During her time as the Chief Executive of the North East Combined Authority (NECA), she cemented public private relationships to drive forward economic plans together.

Helen said: “I feel proud and humbled to be recognised in this way. I would like to dedicate this honour to the whole team at the North East LEP, who strive to increase investment and improve skills, job opportunities and purposeful business support across the North East to improve the lives of others. 

Focused, collaborative work with partners has never been more important as we emerge from the pandemic, and I feel privileged to play a role in responding to the economic impact and opportunities that lie ahead for our very special region.”

Lucy Winskell OBE DL, chair of the North East LEP, said: “Helen is utterly deserving of this honour, having worked quietly but tirelessly to advocate for the North East at the highest levels and ensure that the business community has what it needs to not just survive but thrive.

“Extremely well respected, Helen’s vision and commitment is inspiring – it’s a privilege to work alongside her as we focus on our joint ambition to help the region succeed.”

North East LEP vice-chair Heidi Mottram added: “This accolade is a real achievement and is testament to the leadership and innovation Helen has shown. Thanks to her efforts, the North East LEP is recognised as a national exemplar for its work in skills and business growth. We’re delighted for her.”

Sarah Glendinning, CBI regional director, said: “Helen has always had the region’s best interests at heart and her work continues to make a genuine and measurable difference within the business community and to the economy. Despite the significance of her contribution, Helen is incredibly unassuming so it’s even more fantastic to see her receive this personal recognition and honour.”

Ends.

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North East Local Enterprise Partnership reaction to ONS regional labour market statistics.

The North East Local Enterprise Partnership’s (North East LEP) Strategy and Policy Director, Richard Baker, has commented on today’s regional labour market statistics, released by the Office for National Statistics (ONS).

“This release provides official data to the end of 2020 and enables us to see the full picture about the impact COVID-19 had on the region’s labour market in 2020.

“Looking at the figures for the last quarter of 2020, the number of unemployed people seeking work in the North East region, including the North East LEP and the Tees Valley LEP areas, was 18 per cent higher than in the first quarter of the year. The North East employment rate is the lowest in England at 71.2 per cent and 29,000 people were made redundant in the region during 2020, the highest total since 2012.

“In the later months of 2020, the labour market was less volatile than earlier in the year, but the statistics do not yet include the full impact of the restrictions since Christmas.

“In the North East LEP area, the number of people claiming unemployment-related benefits has increased by over 30,000 since March 2020.

“It is important to look at the detail to understand where the biggest impact has been felt and to identify key future policy challenges. Overall, the impact has been highest in younger age groups and one in ten people are claiming unemployment-related benefits in some areas.

“Another striking feature is the different impact on men and women. Compared with the first quarter of the year, the number of unemployed women in the region has increased by 10,000 or 47 per cent, while male unemployment has grown by 2,000 (just over 4 per cent).

“Yesterday’s announcement from government gives a clear pathway out of lockdown and will offer hope for many people after a very difficult year. However, it remains an uncertain time for businesses as we move to cautiously lift the COVID-19 controls and continue to adapt to new processes following the Trade Deal with the European Union.

“Support for those businesses remaining under restrictions due to the pandemic needs to continue and strategic leadership and a strong partnership with government will be critical as we look to drive forward our regional economy and address some of the key challenges which COVID-19 has created in our region.”

Ends.