Strategy goes for growth in key sectors
Eight sectors have been selected as the focus of the new government’s ‘modern’ industrial strategy which has been widely welcomed by business leaders.
The aim is to create a “pro-business environment” and play to the UK’s strengths, with the focus on growth driving sectors including creative industries and financial services.
Business secretary Jonathan Reynolds has pledged an end to instability, declaring “our modern Industrial Strategy will hardwire stability for investors and give industry the confidence to plan for the next 10 years and beyond.”
The key sectors the strategy will concentrate on are: advanced manufacturing; clean energy industries, creative industries; defence; digital and technologies; financial services; life sciences and professional and business services.
The government says “ambitious and targeted sector plans will be designed in partnership with business, devolved governments, regions, experts, and other stakeholders, through bespoke arrangements tailored to each sector.”
It has also been announced that Clare Barclay, chief executive of Microsoft UK, will chair government’s new Industrial Strategy Advisory Council.
The council is being set up to inform the development of the strategy through its expertise and latest evidence, working with business, trade unions, devolved governments, local leaders and academia.
The government is also asking business to help shape the strategy after publishing a green paper to kickstart its delivery earlier this month.
Views are being sought from business, international investors, unions and any other interested parties, on the overall vision, approach to growth sectors and the policy levers needed to drive investment.
The approach has been widely welcomed. Stephen Phipson, chief executive of Make UK, said: “We live in a world which is massively different to a decade ago and simply leaving the economy and, industrial strategy, to the free market is an ideology which is long past its sell by date.
“This is a welcome first step in addressing the Achilles heel of the economy which has left the UK an outlier among advanced countries.
“It sets out a clarity of vision for how the resources of government and, in particular, each department can be convened towards a single objective of long-term growth across all regions.”
Dr Roger Barker, director of policy at the Institute of Directors, added: “The government’s green paper is a necessary first step in the development of an industrial strategy which provides a more stable and predictable framework for business investment.
“It is important that time is taken to get it right, so that policy commitments are shielded from short-term political pressures, facilitating the willingness of the private sector to make long-term investment decisions.”
Tina McKenzie, policy chair at the Federation of Small Businesses (FSB), said: “This is a refreshingly thoughtful approach for UK industrial policy. If it’s coupled with a clear pro-small business agenda at the Budget, there will be renewed optimism that the Government can get its growth mission right.
“It will be crucial that the developing strategy is responsive to the needs of the whole supplier base, particularly where the interests of suppliers and their big customers don’t align, and that policy levers are selected that have the reach needed to give a positive business platform for small firms.
“Small businesses need a renewed focus on economic growth and it’s encouraging that this consultation emphasises the need to drive investment and provide opportunities across our economy and through our international trading relationships.
“This is so much more than having an industrial strategy ‘document’. We agree that partnership will be key to creating a nurturing environment for small firms to thrive in.
“It’s crucial the strategy works for small firms, as well as big, and addresses the issues that SMEs deal within these sectors and areas – and we look forward to working with government to provide the small business voice as the strategy moves forward.
“Small firms are keen to innovate and take on new technology, yet are often held back by a lack of time and funding. We hope that this strategy will place a renewed emphasis on enabling small firms to use new ideas and tech, increasing their adoption further, boosting R&D support and increasing the UK’s productivity.”
The industrial strategy and growth-driving sector plans will be published alongside the Spending Review in spring 2025.
