Michael Moore's Outlook on finding common ground
If someone talks to you in Edinburgh, they come from Glasgow. Or so I was told when I was a kid by a colleague of my dad’s. We were preparing to move from post industrial Lanarkshire, in the west of Scotland, to the country’s rural south east corner, very much in Edinburgh’s orbit. We hoped my dad’s friend was wrong (as indeed he was).
That west coast jibe was met by an east coast eye roll, of course. And while the warning was meant in jest (I think), it undoubtedly spoke to a deeper truth about how differently the cities saw each other, and hinted at an occasional inability to work effectively with one another.
For Glasgow and Edinburgh, read Liverpool and Manchester, or Sheffield and Leeds, or Cardiff and Bristol. Other examples of good natured rivalry, with a complementary inability to understand and appreciate one another, are available, of course.
The City of London and the City of Westminster for one. Having spent nearly 20 years along the river in Parliament, I remain embarrassed at how rarely I ventured east, to what have now been my professional bases near London Bridge and Chancery Lane for most of the past decade.
Alas, I was not alone in that failure and the lack of understanding between the great cities on the Thames has had consequences for the country as a whole at key political moments in the past few years. I doubt you need me to spell that out. I certainly hope not, as it will only get me into trouble.
Anyway, at the BVCA, tucked away on Chancery Lane, we are very conscious that at the bottom of the road the street has a City of London nameplate, while the one opposite is courtesy of the City of Westminster. Up in our office, we are also aware of the symbolism of being on the edge of the City, but with an outlook that opens up towards Westminster rather than the Square Mile.
So, if there is anywhere in the metropolis where there is literal, rather than figurative, common ground between the two centres of power, I sit and stare at it every day. (Not all day, I promise). And at the risk (once again) of stretching a point too far, over the past few years our focus has been on the need to establish common ground between our industry and the policymakers in Westminster, less so with the movers and shakers of the City.
Given their sub-optimal understanding of our industry, we have been on a mission to demonstrate the public value that private equity and venture capital generate in the UK (cue references to 2.2 million jobs in businesses across the country and an additional 140,000 jobs in the industry ecosystem itself). Only with that argument clearly established can we expect our licence to operate to be looked on favourably and developed further, rather than restricted.
That is well trodden turf in this column (which is not to say I won’t stomp all over it many more times), so for now let me tack eastwards for a moment. If there is a comprehension gap between politicians and private capital, there is also one between private capital and the public markets. Whisper it, but in one important aspect that might be about to change.
The test bed for this new interaction is pension reform. It’s just over six months since the Chancellor spelt out ambitious plans to transform pension schemes and unlock an estimated £50bn of DC pension capital to invest in the productive economy, and provide diversified (and improved) returns to pension savers.
Demystifying existing arrangements and developing new solutions have become the priorities. And the Expert Panel of pensions industry and private capital industry leaders which we established this year is now at work. It has set out an ambitious programme to see how we make private capital investment more attractive to pension trustees, consultants and others. There is a genuine eagerness to create shared solutions.
We know the Chancellor and others will be marking our homework throughout the year. Encouragingly, the Shadow Chancellor has also offered her encouragement and is watching carefully. Political common ground can be very narrow indeed, so when it exists like this we need to take advantage of it. And show we are up to the challenge by building on it. We fully intend to.
Michael Moore
Chief Executive, BVCA
This article was originally published on 14 March 2024 on the Private Equity News website here.
