Sir Nigel Wilson – the North East-born chief executive of Legal & General, probably the country’s largest investment group – must have a thing about breweries.
Seven years ago he was on the former Scottish & Newcastle site in Newcastle city centre – then called Science Central, now Newcastle Helix – to announce a £65m investment in the scheme to build offices, laboratories and other facilities. Three years later it was the former Vaux brewery in Sunderland that attracted his firm’s interest, with Sir Nigel bearing a cheque for £100m towards the Riverside Sunderland project. Both sites aim to provide accommodation for new and growing and businesses, with the hope that the once derelict sites can provide thousands of new jobs.
And last week Sir Nigel was back in Sunderland, just days after announcing his intention to retire in the next year, to perform a topping out ceremony on the Maker and Faber office blocks being constructed behind City Hall. (High winds meant the ceremony happened on floor three rather than the actual top floor, making it something of a ‘middling out’ ceremony).
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And rather than rely on the usual corporate platitudes that are normally the hallmark of such ceremonies, he took the occasion to praise local leaders in Sunderland for their vision but also to highlight how Government efforts to ‘level up’ are still lagging.
“I grew up in this part of the world so it’s thrilling to come back and see how much progress has been made,” he said. “What we see happening here is inclusive capitalism, where we’re trying to level up right across the country, invest in real projects and create real assets that support real jobs and real wages.
“This is one of a number of examples that we have across the country. But what we need in these situations is not the man from Whitehall or from London, we need local people to get behind these projects and political leaders with vision. We’re very fortunate that we’ve got Patrick (Melia, Sunderland Council chief executive) here, who’s one of the great leaders who is committed to making things happen.
“The sad reality was that this site stood vacant for almost 30 years and if you went to Newcastle, you’d have seen the same thing with the Scottish and Newcastle brewery site. We’re in a process of modernising cities across the UK. It’s called devolution but it’s devolution with a little ‘d’ at the moment and we need devolution with a big ‘D’ so that local people are empowered to make a difference, get access to capital and really create lots of new jobs in new industries.”
He added: “People have a view, and it’s a correct view in some sense, that cities in the North have been run down over the last 20 or 30 years. That’s one of the sad facts of life at the moment.”
Turning around those Northern cities, and those in other UK regions, has become a core mission for Legal & General under Sir Nigel’s mission. The company’s investment in Newcastle and Sunderland now stands at around £250m, with the many leading-edge businesses setting up at Newcastle Helix beginning to re-pay the company’s faith in the scheme.
Sir Nigel has been one of the country’s best known business figures of recent years, sitting on Government and industry advisory groups and winning numerous awards. But he grew up on a council estate in Newton Aycliffe until the age of 12 and has credited the education he received at the town’s Stephenson Way Primary School and Ferryhill Grammar School for setting him on the way to a PhD at the renowned Massachusetts Institute of Technology before a career in business. He joined Legal & General in 2009 and became chief executive in 2012.
He was knighted last year for services to finance and regional development, and it is that latter commitment that has made him stand out, choosing to target his company’s huge financial resources towards developments in areas away from London and the South East.
“We’ve been doing this for 14 years,” he said, “starting in Cardiff and Salford. We look very much on these projects as long-term commitments – we’re really in the early days of transformation in Newcastle and Sunderland.
“These are places that have been so neglected because our economic model has been so London-centric. So much of our capital has gone on developing London; we’re almost unique in the world in that. It means that there’s no town or city that has a higher per capita income than Dresden, Leipzig or Berlin, places in the former East Germany that were like medieval cities a generation ago. They’ve just gone past us.
“We’ve had underinvesment for such a long period of time. The big problem is that real median wages haven’t gone up since 2006, 2007. So we’ve got invest capital to upskill people and help them make more money. That’s at the heart of what we’re trying to do. We hoped and expected lots of people to follow us but when we looked over our shoulder we realised we were a long way ahead. That’s sad. We need more people to step up and invest in the UK but the political and economic backdrop make it difficult.”
Despite those concerns, Sir Nigel is positive for the future of the North East, a region he thinks of as home.
“My heart’s still here,” he said. “My mum still lives here and my two sisters and a lot of my friends. I come up about once a month for social reasons and I’m very proud to have benefitted from a great grammar school and social teachers.
“That social mobility that I was lucky to have – it led me to go on and do a PhD at the Massachusetts Institute of Technology. Rest assured my infant teacher didn’t have that picked out for me but all along I had great mentors and coaches who helped me. I want to give back, that’s what levelling up is about. But there has to be a stepping up, and with money, because at the moment we’re getting a lot of rhetoric but not enough capital to make it happen.”
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