Three take-aways from The National Growth Debate
Last week, Demos’s Aidan Garner attended The National Growth Debate – here he offers his reflections.
The event, organised by the Good Growth Foundation, brought together the most senior economic thinkers and decision makers from across politics, industry, media and civil society to address the question: what should future growth look like in Britain?
The politically star-studded speaker line-up included the Chancellor herself, Rachel Reeves, as well as Mel Stride, Adrian Ramsey, and Daisy Cooper – collectively representing the Treasury spokespeople from four of the five major parties. We also heard from Chief Secretary to the Treasury, Darren Jones, Former Mayor of the West Midlands, Andy Street, Former Deputy Prime Minister, Angela Rayner – and many other well-established names.
What stood out at the summit was not just a shared sense that the status quo is failing, but a growing openness to rethink the fundamentals of economic policy – its purpose, theoretical foundations, institutions, and the tools we should be using to drive change.
Here are my three take-aways from the summit:
1. Pressure is building within Labour for a new economic direction
There is a broadening appetite – across Westminster and the regions, among businesses and trade unions, and spanning both left and right – for significant economic restructuring.
Most notably, pressure is building within the Labour Party itself. On the backbenches, a seemingly unlikely coalition has emerged calling for a rethink of the government’s fiscal policy and strategy for growth. This includes Chris Curtis MP, Chair of the Labour Growth Group, and former Transport Secretary Louise Haigh MP, a prominent member of the soft-left Tribune Group.
Both criticised what they described as fiscal constraints on the government – whether self-imposed rules or pre-election commitments – not to raise major taxes. These limits have forced creativity in revenue-raising through Employers’ National Insurance and fiscal drag, approaches that fall short of the kind of economic reform many businesses expected.
They argued that more action is needed to reform a messy and misaligned fiscal system, including council tax and stamp duty, and to address regulatory barriers that continue to suppress growth, particularly in the planning system. Haigh also called for new, more long-term approaches to debt management.
Across party factions, there is an emerging view that the UK’s institutional architecture may itself be part of the problem. If the systems designed to manage the economy, including the Office for Budget Responsibility, are overly restrictive or risk-averse, they can limit the scope for sustained and strategic investment.
With one eye on potential political shifts following the Local Elections, space is opening up. Ideas once considered too interventionist, too place-sensitive, or too long-term are now being discussed more openly. Labour backbenchers, including moderate and broadly loyal MPs, are increasingly willing to challenge Treasury orthodoxy and question whether the current approach to growth is fit for purpose.
2. Growth can be powered through places
Growth is no longer being discussed as something that can be engineered solely from the centre and distributed outwards. Instead, there is increasing recognition that places, including cities, regions, and local economies, are fundamental to how growth is created and sustained.
We heard about the evolving role of mayors, from supporting local businesses and improving skills provision to promoting their regions internationally and strengthening community cohesion. Andy Burnham’s Bee Network was widely praised as an example of how integrated transport can support both economic activity and regional identity.
Labour mayors Oliver Coppard in South Yorkshire and Helen Godwin in the West of England, alongside former Conservative mayor Andy Street, pointed to a more expansive role for regional leadership. Mayors are not just recipients of devolved powers but increasingly proactive agents of growth.
They are also acting as international ambassadors for their regions, building partnerships and attracting investment directly. This marks a shift away from a model in which London dominates as the UK’s primary gateway for capital, towards one where regional economies are more visible and active on the global stage.
The UK’s economic geography remains highly uneven, and centralised policymaking has struggled to respond effectively. The experience of levelling up has exposed the limits of strategies designed in Whitehall, which are often well-intentioned but too distant from the places they aim to transform.
A more effective long-term approach requires more than redistribution. It depends on enabling different parts of the country to generate their own growth, rooted in local strengths and capabilities. This direction of travel is promising, but the shift from rhetoric to reality will depend on whether government is willing to go further, particularly on fiscal devolution and sustained local investment.
3. Trade-offs are unavoidable; timidity is not an option
Hard choices are unavoidable in economic policy. Sidestepping them comes at a cost to both effectiveness and public trust, so the government will need to face them head on.
The debate surfaced a series of such tensions that will need to be addressed directly. These include the balance between fiscal discipline and investment, particularly in the context of constraints shaped by institutions such as the Office for Budget Responsibility. They also include the trade-offs between national priorities and local autonomy, and between short-term political pressures and long-term reform.
Ed Miliband illustrated these challenges through the example of North Sea oil. Expanding domestic extraction could ease short-term pressures and generate tax revenues, but risks undermining incentives to invest in the transition. Limiting drilling may support long-term decarbonisation, but increases reliance on imports and forgoes immediate fiscal gains.
Win-wins in economic policy are rare. Creating winners often means creating losers. Policymaking timidity, defined by a reluctance to acknowledge trade-offs and confront those who may lose out, limits the ability to deliver meaningful reform. The result is an erosion of trust, as avoiding difficult choices weakens legitimacy rather than strengthening it.
This is how the economic and democratic doomloops spiral together: low trust and weak legitimacy constrain policymaking; constrained policymaking eschews trade-offs and defaults to short-term, tactical interventions; weak policy fails to deliver sustained growth and meaningful change for people; and this inefficacy further erodes trust and legitimacy.
From debate to delivery
There is growing recognition that the UK needs a new growth model, one that is more inclusive, more place-based, and more oriented towards long-term value creation.
Delivering this kind of change requires political courage. It means being honest about who gains, who loses, and why. It also means moving beyond short-term, low-risk interventions towards more strategic choices that can deliver lasting impact. Crucially, it requires rebuilding legitimacy by ensuring that people can shape, see, and feel the benefits of economic policy in their own lives.
By placing citizens at the heart of economic decision-making, grounding policy in the realities of people and places, and embedding participation and fairness into the system, growth can become a route out of the current cycle of low trust and weak delivery. When people are meaningfully engaged, when growth is visibly shared, and when trade-offs are made transparently, trust can begin to recover.
Growth cannot be treated as an abstract, top-down objective. It must be rooted in the lived realities of people and places, shaped by local strengths, and responsive to citizen needs.
Delivering this shift will require a dual approach: tackling the deep, systemic barriers that shape the economy over the long term, while also advancing targeted interventions that demonstrate what change can look like in the near term.
For Demos, that means continuing to develop the Citizen Economy as both a long-term vision and a practical agenda for reform, grounded in people’s lived experience, the diversity of places across the UK, and the institutional changes needed to make growth work better.