How the UK can better tap into business firepower to solve its greatest challenges
Whoever comes into power following the next general election will be faced with a monumental challenge: The cost of living is soaring, over 30% of children are living in poverty, and the effects of climate change are increasingly being felt. Yet, with national debt topping 100% of GDP in 2023, the power of the government to tackle these challenges is constrained. Charities and local authorities, meanwhile, have been operating at the front lines and are facing major funding gaps which threaten their ability to deliver much-needed services. How can the next government hope to achieve policy priorities without putting further strain on the public purse?
Businesses have an unrivalled ability to innovate and scale solutions to complex problems, and – together with investors – they are eager to help. Our research found that business leaders are as likely to think that their company’s purpose is to profitably tackle the problems of people and planet as to maximise shareholder returns, and 80% of businesses would find it helpful to have an easy way to connect with government on addressing social and environmental challenges. Unleashing the power of business to support people and planet will also provide a much-needed lifeline to the UK economy, boosting GDP by an estimated £149 billion a year.
Given the tremendous potential of government-business partnerships, our latest report, “How government can partner with business to tackle the UK’s challenges”, sets out to find out what makes them tick. Based on a review of eight government-business partnership models in the UK and beyond, we found that, whereas countries like the United States, France and Japan view relations with business as being of utmost strategic importance, previous attempts to create government-business partnerships in the UK have failed to fully tap into business firepower. A key reason for this is that, with policy responsibility spread across Whitehall, businesses and investors that want to help the government to tackle societal challenges often do not know where to turn and are increasingly calling for a clear focal point within central government.
If the UK is going to hold its own in the race to net zero, and tackle key issues such as the cost of living crisis and regional inequalities, this needs fixing. Building on government-business partnerships past and present, we propose three new partnership models:
The Prime Minister’s Business Breakfasts are designed to harness the full potential of business-led innovation by providing a direct channel for businesses and investors to bring solutions to major national challenges to the Prime Minister’s attention.
The Prime Minister’s Business Action Council enables the Prime Minister to identify the top three priorities on which the government wants to work in partnership with businesses and investors, and put three ministers in charge of overseeing their delivery.
A people and planet-focused Industrial Strategy Council would come into play should the UK put in place a new industrial or growth strategy, expanding the focus industrial policy beyond the ‘traditional drivers’ of growth and productivity to consider people and planet.
The time to act is now: As the country prepares to go to the polls, the government has a unique opportunity to redefine how it works with business for the benefit of people and planet.
