Up until now the government has left the free market to decide where it wants to spend its money, and almost always big business chooses London and the South East.
What would help is taking the kudos out of Oxbridge, or certainly treating other universities in a similar fashion, so the best and brightest are spread around the UK, and not just the south and east midlands. Many hi tech businesses are based around Oxbridge, and its not particularly difficult to understand why.
The government needs to provide at least some direction, and for that we'll need civil servants