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GK Strategy hires Alistair Burt and John Griffith-Jones

GK Strategy hires Alistair Burt and John Griffith-Jones

Former Conservative MP & Health Minister Alistair Burt and ex-Financial Conduct Authority (FCA) Chair John Griffith-Jones have joined GK Strategy, the public affairs agency announced today.

The pair have been appointed as Strategic Advisers to bolster GK’s strategic counsel offer to clients in the health and financial services sectors. They join former Lib Dem Education and Treasury Minister David Laws and Labour’s former Care Minister Phil Hope on the agency’s advisory team.

Burt served as Minister of State for Care at the Department of Health, overseeing primary and community care and mental health. He has held several ministerial roles over a 33-year career as a Conservative MP, including at the Foreign Office, Department for International Development and Department for Social Security. He left the Government and stepped down from Parliament in 2019.

Griffith-Jones was the inaugural Chair of the FCA from 2013 to 2018. He brings additional experience in financial services from his prior career as UK Chairman and Senior Partner at KPMG.

GK Strategy is an independent strategic communications agency working with clients in the public, private and third sectors to influence public policy and shape reputations. Health and care organisations make up GK’s largest client segment in the public affairs market, while the agency also pioneered political due diligence services for the private equity industry, advising on 325 deals worth over $15bn across a range of sectors to date.

Alistair Burt said:

“I’m excited to be joining GK at a crucial time for the health and social care sector. COVID-19 has quickened the pace of reform for the care sector and crucial NHS legislation is expected in the New Year. I’m looking forward to working with GK’s clients to help them navigate this period of change.”

John Griffith-Jones said:

“COVID-19 has had a devastating impact on the economy, which will be felt by the financial services sector acutely. The sector also faces many other challenges, from a shakeup of audit regulation to changes caused by the digital revolution and a greater use of big data. I look forward to helping the sector find its voice, in order to meet its challenges head on and drive the UK economic recovery.”

Robin Grainger, CEO of GK Strategy, said:

“Organisations across the health and care sector and financial services sector are increasingly seeking support on strategic communications and policy research. Alistair and John bring decades of experience from government and the private sector to advise our clients on policy engagement and political risk, and we’re delighted to have them as part of our growing team.”

Notes to Editors

  • About GK Strategy: GK Strategy is a strategic research and communications agency. GK provides public affairs services to clients in the public, private and third sectors and political due diligence to the private equity market. Visit gkstrategy.com background information on GK.
  • Ethics: GK Strategy is a member of the PRCA Public Affairs Board and complies by its Code of Conduct. All consultants, including Strategic Advisers, are registered publicly on the PRCA Register and forgo the right to a parliamentary pass. For more information, visit prca.org.uk/public-affairs-board/public-affairs-code.
  • Further information: please contact Edward Jones at edward@gkstrategy.com or on 0774 9677 543 with any questions.
gk - COVID-19- How to prepare to emerge from the lockdown

COVID-19: How to prepare to emerge from the lockdown

The UK is starting to move into the next phase of the Government’s response to the COVID-19 crisis.

Businesses need to understand how the landscape will evolve again and what part they can play in shaping, responding to and delivering the Government’s priorities for an exit from lockdown.

 Our new paper on the crisis  – COVID-19 How to prepare to emerge from the lockdown – answers the three key questions that businesses and investors need to address:

  1.  How can business engage with some of the recent and ostensibly temporary changes in procurement practice, public sector service delivery, and regulation?
  2. How might lockdown restrictions be lifted and how can business help inform this process?
  3. How can business prepare for a very different policy and funding landscape once the worst of the crisis is over? What will be the new normal?

We set out how businesses can emerge from the lockdown in as strong a position as possible and help plan for and shape longer term changes in public policy, service delivery, funding and regulation, building on some of the changes we previously identified in COVID-19: Short and long term policy impacts for investors and companies.

 We are at another critical moment in this crisis. Businesses need to be well-informed and equipped to navigate and shape what comes next.

gk - What Might the UK’s Exit Route From Lockdown Look Like_

What Might the UK’s Exit Route From Lockdown Look Like?

Across the world, countries are gradually setting out their plans for a return to greater normality following the coronavirus lockdowns. The UK, slow to act earlier this year, is behind most other countries in reducing the spread of the virus, and our “phased exit plan” is also therefore running behind that of other countries. This is both necessary and potentially beneficial – we can see how other countries act, and what this does to the prevalence of the virus. Sadly, there is at this stage still an awful lot that we don’t know about this virus and how it spreads.

The British population has reacted to the lockdown by generally adhering to the government’s rules – indeed, shocked by the brutality of the disease and the Prime Minister’s own near death experience, British people seem less desperate to return swiftly to normality than in many other countries. But our government will be deeply concerned about the short and long term economic and social impacts of a prolonged lockdown, and it will want to see a phased return to greater normality as soon as this can safely be delivered.  In the UK, we seem to be going through four phases of virus response – first denial, then severe lockdown, soon a phased exit plan, and then (eventually) a return to normality once a safe vaccine has been found and can be delivered.

Boris Johnson’s government has extended the current lockdown to 7th May, but around this time we are likely to hear about the detail of the government’s plan for phased exit – this will likely be the longest and trickiest phase of dealing with the virus. Indeed, it is almost certainly the most challenging example of science based government policy-making in the history of the British state. As with other countries, extending the lockdown for too long will undermine and scar the economy, increase educational inequality, and increase mental health and non-virus health problems. But a too-rapid exit route will cause the virus to quickly re-assert itself with the all-important “R” (reproduction) rate moving back above 1. The latter could force further economic lockdowns over a sustained period – wreaking further severe economic damage and driving stock valuations to new lows.

Education first?

As other countries set out the exit routes from their lockdowns, we can see certain common features – as might be expected. Each country is asking itself how much “normality” can return while maintaining social distancing, and protection of vulnerable groups. But not all countries are delivering the same policy solutions. One of the areas of most contrast is education. Some countries are allowing rapid re-opening of schools, to help parents return to work and to avoid learning loss. Others are taking a much more cautious approach.

Re-opening of education is one of the trickiest issues facing the UK government. Superficially, re-opening schools seems an obvious early step to take – young people appear less vulnerable to the virus, while many parents need schools to restart if they are to get back to work. But school re-opening is a tough call. Not only does it send out a powerful “back to normal” message that could undermine social distancing, but it means that other groups – teachers, support staff, parents dropping off their children – are likely to come into much more contact. And if children don’t appear to be particularly vulnerable to the virus themselves, we don’t yet know for sure how much they may spread the virus to family members and friends.

The government has yet to decide upon a firm strategy for schools but the Education Secretary, Gavin Williamson has outlined that it will be done in a “phased manner” and there will be around three weeks’ notice of re-opening to allow head teachers time to prepare their institutions for a “new normal”. This implies that the earliest date for school re-opening is after half term ends, on 1st June. At present, the government seems minded to allow year groups 10 and 12 to return first in secondary schools. These are the year groups taking GCSEs and A Levels next year. There could also be a limited return for younger children in primary schools – to help parents return to work. But if all primary aged children return at once, how would social distancing be maintained? This is an immensely difficult challenge, with no easy solution.

In short, a phased return to school from 1st June seems likely, but this may not include all year groups and there has been a strong indication that many schools will not return to normal until after the summer holidays.

Open for business (only if you can implement social distancing)

If schools aren’t going to be in the vanguard of the exit plan, what might be? Some countries are deciding to return to normality through a geographically differentiated strategy – with high risk areas taking longer to transition out of lockdown. The UK government appears to have rejected this approach – though there is some scope for the devolved governments in Scotland, Wales and Northern Ireland to make slightly different plans.

The most obvious first step for the UK as a whole would appear to be to allow businesses to re-open, based on their capacity to socially distance and their lack of ability to operate from the home environment. This could happen as early as mid-May, though restaurants, shopping centres, pubs, and other such businesses might have to wait a lot longer. If there is going to be a widespread re-opening of business, the government will want  to be able to “test, track and trace” to as large an extent as possible. Without such an approach, the decline in social distancing could easily cause a surge in virus prevalence. The government will also expect social distancing to be implemented in the workplace – which might mean businesses re-opening with a reduced workforce or with other constraints on normal working. Finally, not least in major population centres, some measures to protect those using public transport seem necessary – and this could involve the compulsory wearing of face masks.

Also in this first stage of the exit we could see a softening of rules around social distancing – allowing people to regularly meet with a wider group of friends and relatives. But older and more vulnerable people will need to maintain social distancing, and it seems very unlikely that larger public gatherings or sporting events attended by spectators  would be allowed.

The next phase – moral and political challenges to navigate

If this is what phase one looks like, phase two could begin in early June with the limited re-opening of schools. Presumably, this would be accompanied by stronger signals that people are expected to return to work, except in the limited number of sectors where social distancing would be very difficult. At this stage, the government will need to consider the future of the Coronavirus Job Retention Scheme – due presently to cease at the end of June. This will be a very tough decision – extend the scheme too far, and the cost is immense. But bring the scheme to an end, and the government will take the blame for mass redundancies, not least in sectors that are still locked down. Make the scheme more flexible, and the cost may rise further and the withdrawal process may become more politically tricky. Perhaps the most sensible thing would be to extend the scheme beyond June, but only for sectors where government rules prevent a return to normality – restaurants, pubs, airlines, could fall into this category.

What else? Well, by now we are likely to be dealing with a global situation where some countries are seeing great success in controlling the virus, while others are not. A highly open country, such as the UK, with a massive tourist industry (not least in London) faces a huge risk of re-importing the virus, and wrecking its own recovery. So tighter control of border entry maybe necessary – with routine screening of passengers at entry points, not least from affected countries.

Phase three of a return to normality would likely be implemented in the Autumn – re-opening of all businesses, and full re-opening of schools in September. Ideally, older and vulnerable people would then be able to mix more.

But the appropriate word is “ideally”. All of these carefully laid out plans could be wrecked by a new surge in the virus, which – as we have already seen – is both deadly and capable of spreading with frightening speed.

One reason why the UK government should not feel rushed to implement its plans, is that it has the opportunity to see what is now going to happen in the countries where re-opening is taking place. Many senior health advisers are clearly worried about further significant pandemic peaks – as panicked governments and bored populations rush to return to normality. The best laid out “phased exit plans” may be seriously knocked off course by the immense challenge of managing populations back to “normality” without allowing the virus to spread again.

It would be an astonishing public policy achievement if the world could escape from this with just one pandemic peak. There must be a significant risk (perhaps more than 50%) of further significant virus outbreaks (and associated toughening of control measures) before at some stage, perhaps in mid-2021, the scientific community rides to our rescue with the vaccine we need to safely return to true normality.

gk - strategy-scaled

COVID-19: Short and long term policy impacts for investors and companies

The policy impacts of COVID-19 will not just extend to the many measures designed to help the economy over the next few months. The political and regulatory world will change profoundly and for the long term.

We are advising investors, portfolio companies and other organisations on what help is available and how they can best advocate for and access assistance.

The Government has shown its willingness to engage with business and respond to requests for greater clarity, revised eligibility criteria or additional support, and indeed offers of help, as we have found in our work for clients.

But there are six key questions that investors and management teams should also pose about some of the policy assumptions underlying their growth plans and existing risk assessments, as they model their businesses under a range of COVID-19 scenarios:

Will gig economy and labour regulation be revaluated?

The IR35 reforms have been delayed till April 2021, allowing time for a more significant review. But COVID-19 has highlighted how exposed many gig economy workers are to any sort of crisis.

This – as well as the criticism that the Government has received from its own benches over how it has handled the issue of employment security and workers’ lost income in the early stages of this crisis – is likely to reinforce the argument for employers to bear a greater burden of responsibility for their workers and contractors, as well as their permanent employees.

As the Government loosens some of the restrictions on access to and the generosity of Universal Credit, there may be more permanent change to how this part of the welfare system works. There are longstanding political criticisms of the design of this policy that the crisis will force policy makers to address, again particularly for households in insecure work. All of this could impact labour costs and flexibility significantly.

How reliant is your business on migrant labour?

The impact of Brexit on the availability of migrant labour has been a regular theme of our due diligence for the last two years, but this crisis has shown how many other factors – relating to pandemic control and people flows – could have a much more significant, sudden and less predictable impact than Brexit.

Will the tax holidays last longer than 12 months?

It will be extremely difficult for the government to revert to pre-holiday tax levels, unless the economy bounces back strongly, and particularly difficult to reinstate taxes on nurseries, which are already permanently exempted in Scotland and Wales. It will also be difficult because of the uncertainty of current Brexit timings (which may be revised).

This could lead to a more fundamental review of business rates or indeed any other tax measure that has a big impact on businesses that rely heavily on good cash flow. As the crisis has revealed, many businesses risk extinction even after short periods of massively depressed demand.

How might new public funding priorities impact your business?

The massive fiscal stimulus will inevitably require a reallocation of resources, if not cuts in some areas. Funding for health and social care will no doubt increase to improve long term resilience and deal with the immediate impact of COVID-19. However, some aspects of health and social care may receive less resource – particularly if they are seen as less critical to ensuring prevention and improving the capacity of the system.

Local government resourcing and priorities may also change, especially to ensure that vulnerable groups and schools and other civic amenities are better prepared (especially as COVID-19 will inevitably reappear until a vaccine is developed and made widely available).

How will public and private procurement change?

Public procurement will change to reflect new government funding priorities, but will also change to reflect the need to have more resilient supply chains in the event of further similar shocks.

This may mean encouraging more local and more national supply (especially post-Brexit), to lower exposure to long supply chains that might be vulnerable to multi-country measures that could slow exports. Some public sector bodies might choose to bring more provision in-house for similar reasons.

It may also mean that procurement tenders will be broken down into more lots, to encourage a broader supply base and reduce reliance on just one or two providers.

Procurement criteria is also more likely to require more comprehensive demonstrations of business continuity preparedness.

How will Brexit and the future of the EU be affected and what impact could this have on your business

Brexit could be delayed, justified by a more plausible and politically acceptable need for a longer implementation period.

But much bigger changes could be seen across the EU, as France and Germany’s authority and appetite for further EU integration is undermined by their own trouble managing the crisis domestically, as well as the manifest desire of all EU countries to pursue their own self-interest and impose strict border controls.

We expect many other changes, in terms of how Whitehall and Westminster and major public sector bodies operate.

Over the next 12 months, GK will be tracking these developments systematically and advising clients on how best to anticipate, prepare for and influence these changes, both in the near term and beyond the end of the immediate crisis period.