Invest Gatwick Diamond has called on the Government to accelerate infrastructure funding and widen access to non-debt support for businesses, after the Bank of England raised interest rates for the first time since 2023.
On November 5th, the Monetary Policy Committee today voted to lift Bank Rate from 3.75% to 4%, pointing to inflationary pressure from energy and fuel prices linked to the conflict involving Iran, and signalled that further rises may follow.
We spoke to Gatwick Diamond Business Executive Director Brett North about what the decision means for the region’s £165 billion economy.
A double squeeze on investment
“This is the decision we told businesses to prepare for. In our response to the Autumn Budget, we set out how rising operating costs, particularly fuel and transport, were already leaving firms across the Gatwick Diamond with very little room to invest. Today’s rise squeezes them from the other side.
“The day-to-day cost of running a business is going up, and now the cost of borrowing to grow that business is going up too. Margins are shrinking at the same time as the debt needed for capital expenditure gets more expensive. That is a double squeeze on investment.”
Growth sectors need capital
“Our economy is built on technology, aviation and advanced manufacturing. These sectors depend on significant, ongoing capital investment, whether that is adopting AI, automating production or upgrading fleets. When borrowing becomes too expensive, those projects get delayed or shelved. If that happens here, it directly undermines the growth the government says it wants to see.”
A national revenue issue
“It’s worth repeating that the Gatwick Diamond puts far more into the Exchequer than it gets back. Tightening the financial screw on businesses here isn’t just a regional concern, it’s a risk to national revenue. Growth in this region helps pay for public services right across the country.”
No mayoral safety net
“Our businesses are carrying a heavy load into 2027, and they’re doing it without the mayoral safety net that devolved areas can lean on. A rate rise, with the Bank signalling more may come, amplifies that vulnerability.
“If the Bank of England is making borrowing more expensive, government needs to offset it by accelerating predictable infrastructure funding for transport, power and housing in this region. Gatwick Diamond businesses cannot be left at the back of the queue.”
Support that doesn’t add to debt
“With commercial debt becoming a heavier burden, the practical answer is better access to support that doesn’t add to it. That means targeted grants, innovation funding and extended capital allowances that give firms the confidence to keep investing.
“Businesses in the Gatwick Diamond are resilient and ambitious. They need the right conditions to keep moving forward, and we will keep making that case to government.”