Opinion: ‘Building a more resilient Peterborough economy’

Councillor Shaz Nawaz, Labour Group leader on Peterborough City Council writes...

Sunday, 6th June 2021, 1:30 pm
The former Thomas Cook offices in Peterborough.

Not every company suffered due to the pandemic.

Amazon, for instance, did particularly well.

Indeed, technology firms as a whole thrived.

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As of December 2020, Facebook, Apple, Microsoft, Amazon and Google saw their shares rise in value by 44 per cent during the course of the year. I’m glad that the wheels of commerce kept turning.

Nevertheless, we have discovered since 2008 that big isn’t always necessarily better. We see a “predominance of the big” in many spheres: there are only a few major high street banks. Our utility companies are also generally part of larger conglomerates. Even public transport is usually handled by big firms.

The logic goes that a larger firm has more resources to withstand rougher times.

However, this is not necessarily correct. We found this out during the financial crisis.

Furthermore, given the rash of closures of large retail outlets, we have ample evidence that large doesn’t necessarily mean resilient.

As a city, we should encourage “resilience through diversity”.

This means encouraging small firms to start up and grow. Many people in the United Kingdom work for small- and medium-sized enterprises. Statistics from the National Federation of Self Employed & Small Businesses suggest they provide three-fifths of UK jobs, and 52 per cent of turnover.

How do we achieve this? Preston’s council provides a model: they have used public procurement to encourage local firms to develop. They do their best to keep spending local; this has the effect of providing a single large customer. Furthermore, it ensures that the benefits of procurement remain within their city. It is a bit of a nonsense for people to pay taxes locally, only to hire firms from out of town, particularly when the city needs to spur development.

We can further encourage resilience by encouraging new modes of ownership.

Co-operatives have long been in operation in the UK. Worldwide, there are co-operative firms providing everything from chocolate to robotics. By making employees the owners of their firms, we can change the nature of the relationship; via this model, employees have a direct stake in a firm’s continued survival and prosperity.

Furthermore, no firm can survive without a continued percolation of creativity. Ideas are a collective endeavour and by giving employees a direct stake, imagination and enthusiasm are spurred onward.

It is totally possible for Peterborough to improve its resilience. However, that requires thinking about the economy in a new way.

I am not certain this administration is doing so. I believe they are stuck in a time warp, whereby if a big firm comes along and builds a new warehouse or factory, they believe their job is done.

However, perhaps we ought to think about ensuring we don’t put all our eggs in one basket. We don’t want to be in a position like we were with the collapse of Thomas Cook, one in which we have to scramble to provide alternative employment because of what was happening to a firm on a national basis.

Bigger is not always better. Bigger carries risks.

A wise council would adhere to a policy that encourages all sorts of firms to grow, so that if one type runs in to trouble, there are alternative employers to fill in the gaps. We need to move away from a low-wage economy and that is a challenge to which we must rise.

Will this administration change course? I hope so.