Lord Malcolm Offord: Levelling up cash is 'real devolution'

Despite a 25-year career in financial services in London followed by nearly a decade in Edinburgh, Malcolm Offord is a Greenock boy at heart. That’s why, when he came to be ennobled, he chose the title Lord Offord of Garvel – a reference to Garvel Point, the location of the harbour that transformed the town into a thriving trade port and shipbuilding hub back in the day.

Offord was born at 33 Bank Street, a tenement block right in the centre of Greenock. His mother was a nurse and his father a building surveyor. He was the third of six children, which meant there “wasn’t a lot of money” growing up. “But what was very valued in that household was education. And so that was the focus really, of home life. I always felt that I wanted to spread my wings, get away and get up and out in the world,” he says.

He attended local schools before leaving for Edinburgh University in the early 80s. “That’s when the shipyards were closing and that’s when the deindustrialisation was happening in the west of Scotland and as a group of school leavers, we were effectively forced to leave and go around the UK or the world… I suppose with deindustrialisation, opportunities closed down – but that allowed us to flourish.”

While he puts a positive spin on feeling he had to leave Greenock to be successful, this is what fuels his enthusiasm for building up the towns of Scotland now. It’s a central tenet of the UK Government’s levelling up agenda.

Offord in front of the tenement he was born in

The buckets of cash the government is providing to local authorities either through city and regional deals, or directly through other programmes, “goes a long way” in towns, he says. And while there has been some pushback from the Scottish Government on the way some of this cash is provided – it does not go through the Scottish Parliament via the Scottish block grant – Offord does not believe those concerns are justified.

“I’ve been in the job two years now and I’m quite heavily involved in the city deals and regional deals in the levelling up agenda – £2.5bn has now gone in, if you include the £140m for the seven towns that was announced [recently]. Wherever I go, we interact with local authorities in Scotland and all of them, no matter what political persuasion, are absolutely delighted with the UK Government. They say it’s the first time they’ve seen the UK Government since devolution, and the government is more involved in Scotland that it’s ever been in 25 years. They say that they are delighted with the level of engagement they’re getting from us.”

A lot of this cash is simply replacing funds that came from the European Union which also bypassed Holyrood, he says, but it does so “with better targeting, with much, much stronger interaction with local people”.

“What’s happening here is the local people are picking the projects they want on the ground. It’s not being prescribed to them by Brussels or London or even Edinburgh, they’re actually deciding themselves what is the best thing in their town. This is the right way to do it. That’s what you might call real devolution.”

We’ve always punched above our weight. How have we done that? Because we’ve always been international in our outlook

Offord describes himself as a “reluctant Brexiteer”. He voted to leave the EU in 2016, but it was a close call. “The thing that swung it for me was trade,” he explains. And earlier this year he took on responsibility for some of that, becoming Exports Minister alongside his Scotland Office role. He says there is an opportunity now that didn’t exist when the UK was part of the EU to really grow trade with the rest of the world.

“In the next 10 years, the big trading powers are going to be India, China, the USA. At the moment we have 50 per cent of trade to Europe, 20 per cent to the US and 30 per cent of the rest of the world. We have a real opportunity to grow that to 50 per cent for the rest of the world. And for me, that was what Brexit was all about. We will always continue to trade with Europe, but there’s a big, wide world out there of real growth opportunities that we were not maximising.”

While he acknowledges that some of the bigger trade deals promised in the run-up to the EU referendum have not yet come to fruition – “intense discussions” are being had with India and the US “are not doing trade deals with anybody right now” – he says that “Brexit was itself a free trade agreement”.

But for him, the benefit of trade isn’t just trade itself, nor GDP growth, but the knock-on effect it has on local communities. “I’ve always been fascinated that Scotland is a small country, only five million people, but we’ve always punched above our weight. How have we done that? Because we’ve always been international in our outlook.

“If you are in smaller towns, whether that’s Hawick, or Bathgate, or Cumnock, where you see successful businesses, you’ll find they’re all exporting. Because in order to employ local people, you can’t do that if you’re selling only to Scotland. In the UK, 10 per cent of companies are exporting. My ambition is to get that number up.

“What we learn about companies that export are some really interesting things. Number one, the management of these companies tend to be more ambitious, by definition, they want to trade internationally, not just at home. They have products that are loved around the world, and that’s usually higher margin products. The companies are more productive. And here’s the silver bullet: they pay higher wages.

“If we can get more of these companies in what I call the real communities – not in the big cities, but back in the towns – where they are employing local people in skilled jobs, paying higher wages, because they export, that is good for the ecosystem, that is good for the economy, it’s also good for these communities. And so that’s why I’m pretty passionate about this, we need to get the number of companies that are exporting up because it will be good for local communities.”

The minister returned to his home town of Greenock in September to announce the creation of a new team of international trade advisers who will provide guidance and advice to help Scottish firms begin exporting. “It was very reassuring to me that we can be back in that town saying to people there’s still a beating heart here, there’s still enterprise. The UK Government’s here to encourage you.”

The prime minister has stepped up, having dealt with fighting fires... and is now able to say what we are really trying to do now

Growing up, Offord says his family were “small-C conservatives”, though never party political. That may seem unusual given Greenock’s political history. The town has never elected Conservative MP or MSP. Indeed, you’d have to go back at far as 1931 to find a parliamentarian that was neither Labour nor SNP. The minister says there was “a feeling we were a little bit different” to those around him, though he adds there were “quite a lot of what you would call working class Tories”. “They were just a creed that said that one should work hard, try and be as self-reliant as possible, take responsibility, and get educated and prove oneself. And that’s a basic, common creed; a very typical Scottish, small-C conservative belief.”

He only realised he was a big-C Conservative when he moved to London in the late 1980s. He owes his successful career in asset management and private equity to the so-called Big Bang in 1986. “I related that directly to the Conservative Party. That was [Chancellor] Nigel Lawson basically deregulating financial markets, allowing enterprise to flourish. And so that would be the point where I said, right, I am now a Conservative.”

With that in mind, he began making donations to the party because he “felt that they were my party and I should support them”. Interestingly, though, he did not become a fully paid-up member until recently, when he decided to run to become an MSP. He was placed fifth on the Scottish Conservative’s Lothian list for 2021 and so failed to gain a seat, but less than five months later it was announced he was to be made a life peer and Scotland Office minister under Boris Johnson.

That inevitably raised questions and accusations of cronyism. Offord had donated just shy of £150,000 over a 15-year period – but he categorically denies that had anything to do with his elevation to the Lords. He describes the phone call from Scottish Secretary Alister Jack inviting him into government as “completely out of the blue” and insists there was “no expectation” that he would be offered such a role when he made the donations.

As a minister, Offord has been keen to move the Scotland Office – and wider UK Government – away from the devolve-and-forget attitude his party has been guilty of since 1999. “I’m very proud to be part of the Scotland Office which has been the most active Scotland Office, I think, in 25 years. We’re all passionate Scots, we’re working within the UK Government to get the best deal for Scotland,” he says.

He is bemused by recent commitments made by Ian Murray, Labour’s shadow Scottish secretary, that a Labour government would seek to be more active and visible in Scotland, work with the Scottish Government, and strengthen ‘Brand Scotland’ around the world. “That word for word describes the Scotland Office I’m working in right now… We are very engaged. And we are, as I said before, interacting directly with 32 local authorities, making the UK more visible.

“There’s been this argument about whether we should be putting UK flags on these projects like there used to be EU flags on them. Maybe that’s what [Murray] has in mind. But there’s no question, talking to the 32 local authorities, they do know where the money’s coming from.”

Offord’s time in office has been rather unusual. In the last two years, he’s worked under three prime ministers and through significant turmoil for the Conservatives and the UK economy. He describes last year’s party conference – which took place as then Prime Minister Liz Truss was fighting to hold onto her premiership – as “quite spicy”. But he welcomes the direction Rishi Sunak is taking the government in now.

There’s no question that some of the ideas that were espoused by Liz Truss have their merits

“The real emphasis of [his] first period in office has been just to steady the ship, get the economy stabilised. We’ve been through a hell of a shock with the Covid pandemic, then the Ukraine war, and then inflation… It feels to me like in the last two months the prime minister has stepped up, having dealt with fighting fires, put the fires out, and is now able to say what we are really trying to do now for the next period.

“That means having to make some tough decisions. I really admire him for what he’s done, actually, in terms of making these tough decisions. Most of that is just driven by common sense, but somebody has to come out and say it.”

Asked what he made of Truss’s intervention at conference, in which she called for some of the same tax changes which spooked the markets and ultimately ended her time in office, Offord says: “There’s no question that some of the ideas that were espoused by Liz Truss have their merits. The question is, how do you go about doing it? I think the issue was more perhaps of the execution of that. That was badly handled.

“What we’ve got now is a government that’s actually stabilised, everything is under control as far as the markets are concerned. That now allows the opportunity to think about those longer-term questions.”