When the UK government set a mission for the highest sustained growth in the G7, it acknowledged something many business owners already feel: growth doesn’t happen evenly. London and the South-East have pulled ahead, while former industrial areas in the Midlands, the North of England, Scotland, and Wales have faced long-lasting economic consequences. Job losses in manufacturing, steel, coal, textiles, and shipbuilding created ripple effects that still shape those communities today.
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This article is general information only and does not constitute professional advice. For your specific situation, consult a qualified professional.
What this means in practice is that local partnerships aren’t just a nice-to-have. They’re becoming central to how the government plans to distribute resources and support growth. The new Local Growth Plans will require local areas to produce their own strategies, linked to a national industrial policy. For business owners, understanding how these partnerships work could mean the difference between being left behind and being part of the recovery.
Here’s what you actually need to know.
Four Key Takeaways and What Community Growth Really Means
The term that keeps coming up in this conversation is Community Wealth Building.
What I tend to notice is that many business owners assume local partnerships are about charity or corporate social responsibility. They’re not. They’re about creating economic structures that keep money circulating in your area rather than draining out to distant shareholders.
What’s at Stake When Local Partnerships Are Ignored
The British Academy found that communities with established social infrastructure before the Covid-19 pandemic were more resilient and had stronger community support networks. That’s not a vague observation — it’s a direct link between local connections and survival during a crisis.
On the flip side, the UK has had slow economic growth since the 2008 financial crisis, with only modest improvements in living standards. Recent shocks like Covid-19 and the cost-of-living crisis have made things worse. Economic shocks hit communities differently, but the most vulnerable are always hit hardest.
Here’s the practical tradeoff. The government has limited resources and must decide where to direct them — between more and less productive areas. The Economy 2030 Inquiry noted that these decisions will influence how fast national productivity improves and how fast inequalities between places are reduced. If your local area doesn’t have strong partnerships in place, it’s harder to make a case for investment.
There’s also a tension worth naming. The Centre for Cities argues that regeneration should focus on making cities more attractive to businesses. The Community Wealth Building approach, by contrast, focuses on retaining wealth locally through cooperatives, social enterprises, and anchor institutions. These aren’t the same strategy, and local partnerships will need to choose which direction to push.
Where Local Partnerships Go Wrong
Treating Partnerships as a Box-Ticking Exercise
Some businesses join a local partnership board, attend a few meetings, and expect results. That rarely works. The evidence shows that effective partnerships require genuine commitment to local supply chains and labour markets. The Preston Model succeeded because anchor institutions — the council, the university, the hospital — actually changed their procurement practices. Without that shift, a partnership is just a meeting.
Ignoring Hyper-Local Inequality
Inequalities are often larger within places than between them. You can have a deprived neighbourhood a ten-minute walk from an affluent one. National policies can’t address that granularity. Local partnerships that don’t map these micro-gaps end up directing resources to the wrong places. A partnership that works for the town centre might do nothing for the estate on the edge of town.
Focusing Only on Big Employers
There’s a natural tendency to court large companies for investment. But the Economy 2030 Inquiry suggested that policymakers should focus support on young and growing firms that drive change, regardless of size. Small businesses and cooperatives are often more rooted in the local economy. A partnership that ignores them misses the businesses most likely to keep wealth local.
Underestimating the Time Horizon
Devolution and local growth plans don’t produce results in a quarter or two. The evidence for a causal link between devolution and economic growth remains unclear, though there may be civic and social benefits. Partnerships that expect quick returns often dissolve before they’ve had time to work. The ones that last are the ones that treat relationship-building as the core activity, not a side project.
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| Approach | Focus | Key Mechanism |
|---|---|---|
| Centre for Cities model | Making cities attractive to businesses | Encouraging external investment |
| Community Wealth Building | Retaining wealth locally | Anchor institutions, cooperatives, local procurement |
| Devolution to Combined Authorities | Regional decision-making | Expanded local powers over transport, skills, housing |
How to Build Local Partnerships That Actually Work
Map Your Local Economic Ecosystem First
Before you approach anyone, understand who the anchor institutions are in your area. The local council, the largest employer, the university, the hospital trust, the further education college. These are the organisations with the procurement budgets and the hiring power. The Preston Model worked because it identified these anchors and got them to coordinate their spending. You can’t build a partnership if you don’t know who holds the economic levers.
Focus on Progressive Procurement
This is where the rubber meets the road. Anchor institutions can choose to buy goods and services from local suppliers rather than national chains. That keeps money circulating locally. The process involves reviewing current supply chains, identifying where local alternatives exist, and adjusting procurement policies to favour them. It’s not about excluding non-local suppliers — it’s about giving local businesses a fair shot. A business law service can help review procurement contracts to ensure they comply with regulations while prioritising local suppliers.
Diversify Ownership Structures
The government plans to double the UK’s cooperative and mutuals sector. That’s a signal. Cooperatives, social enterprises, and employee-owned businesses tend to keep profits and decision-making local. If you’re starting a business or restructuring an existing one, consider whether a cooperative model fits. It’s not right for every business, but it aligns directly with the direction of local growth policy.
Build Social Infrastructure Alongside Economic Activity
Libraries, pubs, shopping centres, and parks aren’t just amenities. The British Academy found they were a factor in community resilience during Covid-19. Local partnerships that only focus on jobs and investment miss half the picture. A thriving local economy needs places where people connect. Business partnerships can support these spaces — through sponsorship, shared use, or direct investment. It’s not charity; it’s infrastructure for a resilient local economy.
Frequently Asked Questions
What is a Local Growth Plan? ▾
How do I find my local Combined Authority? ▾
Can a small business join a local partnership? ▾
What’s the difference between devolution and local growth plans? ▾
Does Community Wealth Building only work in cities? ▾
How long does it take to see results from a local partnership? ▾
Local Partnerships Are the Engine, Not the Add-On
The most forward-looking point from this research is that local partnerships aren’t a supplement to national economic policy — they’re becoming the delivery mechanism for it. The government’s own horizon scan acknowledges that the UK’s centralised governance system has been criticised for restricting local areas’ abilities to respond to economic challenges. Devolved governance is associated with more spatially balanced growth, even if the causal link isn’t fully proven yet.
Remember: this article is general information only. For advice on your specific situation, speak to a qualified professional.
If this was useful, you might also want to read Decoding the UK’s Productivity Puzzle: Solutions Businesses Can Implement Now.
Sources and Further Reading
Decoding the UK Consumer: New Trends and Buying Behaviours — Understand how shifting consumer habits affect local economies and what partnerships can do about it.
UK Parliament (2024). Horizon Scan 2024: Local Growth Partnerships. 🔗
