Two-thirds (66%) of businesses said they understood what the government’s Investment Zone policy is trying to achieve, with 68% also believing that the introduction of the Zones will help towards the government’s Levelling Up agenda.
Grant Thornton’s latest Business Outlook Tracker survey of 601 mid-sized businesses on the introduction of Investment Zones found a ‘significant number’ of respondents agreed that being located within one of the Zones would help to support the local region.
The factors they cited include job creation and skills development (70%) and being generally beneficial to local businesses (71%). The positive impact of being in a Zone would also encourage many businesses (72%) to stay within the local area.
The survey also found that despite not currently in the running for an Investment Zone, the East of England was the most positive region about the policy. Almost all (94%) believe that being located within a Zone would help to support the area and be beneficial to local businesses (86%).
In contrast, despite being shortlisted for a Zone, only 50% of businesses in the West Midlands were positive about the policy. Just over half (54%) said they understood what the policy is trying to achieve.
Investment Zones provide a number of financial incentives to local businesses in the area, with the survey finding that there were mixed views on whether they have been chosen correctly. Just over two-thirds (68%) believe that these incentives, such as Stamp Duty Land Tax relief and 100% Business Rates relief, have been focused on the right areas to encourage business investment.
Businesses in Liverpool City Region were significantly above the national average, with 80% agreeing they’re focused on the right areas, while other areas also in line for a Zone – West Midlands (60%), East Midlands (62%) and Greater Manchester (66%) – were less convinced and below the national average.
Wayne Butcher, Director, Public Services Advisory, Grant Thornton UK, said: “Our research shows that there is a generally positive view from businesses, at a national level, on the intended purpose and potential benefits of Investment Zones. You would expect that those chosen for a Zone would be relatively positive about the policy, but it’s clear that there is already a good level of engagement nationally from the business community.
“Businesses can clearly see merit in the approach and view Investment Zones as a useful mechanism to unlock further investment and bolster the economy. But it’s also clear that the level of confidence and understanding of the policy differs across the country, and amongst those already in line for a Zone.”
He added: “While still a relatively new initiative, if this mixed level of understanding is not addressed, there is a risk that it could become a barrier to truly maximising the benefits, for the whole nation, of the new Zones.”
“Businesses can clearly see merit in the approach and view Investment Zones as a useful mechanism to unlock further investment and bolster the economy. But it’s also clear that the level of confidence and understanding of the policy differs across the country, and amongst those already in line for a Zone.”
Wayne Butcher, Director, Public Services Advisory, Grant Thornton UK
