UK provinces 'need more investment'

As the capital's thriving financial services sector shows, London has remained the UK's major economic hub despite efforts by successive governments to spread investment and business growth out to the provinces.

According to the Cites Outlook 2014 report from Centre for Cities, London is leading the way when it comes to England's ongoing economic recovery, as well as attracting talented workers from across the globe.

There are also green shoots of growth to be seen in urban areas such as Liverpool, Manchester, Nottingham and Leeds, where private sector investment is strong, as well as in Cambridge, Reading and Bristol, which host many skilled workers.

However, the thinktank suggested that more needs to be done to ensure these cities are given the same opportunities for expansion that are enjoyed in London, if the UK is to avoid becoming an overly centralised economy.

Chief executive Alexandra Jones told the Guardian that Germany is a good example of how this can be avoided - there, Berlin is the seat of the government while Frankfurt is the financial centre and other cities such as Hamburg and Munich remain important cultural areas.

"Cities Outlook 2014 shows that the gap between London and other UK cities is widening and we are failing to make the most of cities' economic potential," added Ms Jones.

She suggested the government should "devolve more funding and powers to UK cities" in order to ensure a "sustainable, job-rich recovery across the country".

Manchester has recently gained a reputation as a good place for financial services firms to base their offices, offering a highly-talented workforce as well as cheaper rent than that offered in the capital.

Some 16.6 per cent of gross value added across the north-west's biggest city is provided by the banking and finance sector, with 100,000 workers in this industry based there.

Writing in City AM, chief executive of the British Bankers' Association Anthony Browne highlighted the fact that financial services can have a positive impact across the UK, given the right business conditions.