Labour could move Bank of England from London to Birmingham to ‘rebalance economy’
Labour is considering relocating most of the Bank of England (BoE) from London to Birmingham if it wins power at the next general election. It comes as part of its plan to push investment outside of the capital and “rebalance the economy.”
A report commissioned by Shadow Chancellor John McDonnell has concluded that the BoE’s London base is “unsatisfactory and leads to the regions being underweighted in policy decisions.” The plan would see “some functions” of the BoE moved from its historic base in Threadneedle Street in the City of London, where it has been based since 1734.
Other recommendations from the report by consultants GFC Economics and Clearpoint Corporation Management included opening BoE offices in Glasgow, Cardiff and Belfast, along with two smaller regional offices in Newcastle and Plymouth. Labour’s policy review will address the question of whether the governor should also be based in Birmingham.
Labour already plans to create a National Investment Bank and Strategic Investment Board if it wins the general election. “All three, side-by-side, would constitute a new ‘economic policy’ hub,” the report says.
The report suggested moving the Bank of England’s premises “close to” Birmingham’s main train station, saying a relocation would “provide a clear, visible example of a new government’s determination to promote growth and a rebalancing of the economy.”
McDonnell told the Financial Times the “important report drums home the message that our financial system isn’t delivering enough investment across the whole country and in the high-technology industries and firms of the future where it is needed most.”
Our current financial system is simply not delivering enough to the rest of our country. This report shows how we can really redress the balance in our economy.https://t.co/bDBipKlgCL
— John McDonnell MP (@johnmcdonnellMP) December 11, 2017
Birmingham has already started attracting some of the City’s financial institutions. HSBC is making final preparations to open its new UK retail headquarters in Britain’s second city in the new year.
The city is also one of the potential homes for part or all of Channel 4, which Theresa May’s government has promised to move out of London. The publicly-owned broadcaster has resisted the change, saying advertisers and program suppliers tend to be based in the capital.
Birmingham has been at the center of Tory efforts to win over Labour heartlands.
McDonnell also wants to re-nationalize the water industry, the railways and regional energy networks. He is yet to say how much it would all cost.
