Southern start-ups receive ‘five times more funding than in the North'

Start-ups in London, pictured above, and the South East have received five times more Government funding than those in the North and Midlands, according to analysis by Labour.

South-east and London businesses in total received more than £700 million in funding, while those in the North, Yorkshire and Midlands received £140 million, data shows.

Meanwhile, the average award for a start-up in the North East, North West, West Midlands and Yorkshire was lower than that for a business in London or the South East.

Shadow business secretary Ed Miliband accused the Government of “reinforcing economic imbalances in our country” in the start-up funding.

Just over two-thirds of applications for the Future Fund – launched to help protect the UK’s innovation sector during the coronavirus crisis – were from London and the South East.

The average award for businesses in London was £1,058,422, while in the North East it was £892,857, according to Labour’s analysis of Future Fund data.

In Scotland, the average award was just a third of the national average at £352,941, data suggests, while in Wales it was half at £500,000.

Data also shows that the approval rate for applications from the North West, Scotland, Wales and the West Midlands were lower than the 84% approval rate for those from London and the South East.

Mr Miliband said: “While the Government talks about backing the North and Midlands, the reality is starkly different.

“By investing much more heavily in start-ups in the South of England and squeezing out other parts of the country, they will be simply reinforcing economic imbalances in our country.

“Ministers have already hurt hard-working entrepreneurs during this crisis by excluding them from support. Instead of hot air and rhetoric, it is time for ministers to deliver.”