UK manufacturers have called on ministers to stop the about-face and urgently develop an industrial strategy, warning that the lack of a long-term plan is stunting growth and hurting the UK’s competitiveness.
The appeal by trade body Make UK highlights growing industry frustration at the government’s lack of effort to help a crucial sector of the UK economy since the decision to drop the latest industrial strategy in March 2021.
“A lack of a good, planned, industrial strategy is the UK’s Achilles’ heel,” said Stephen Phipson, chief executive of the trade body, adding that the UK was the only major economy not to have one.
“If we are not only to tackle our regional inequalities, but also to compete on the world stage, we urgently need a national industrial strategy. . . We cannot continue to switch from one initiative to another without placing them in the context of a longer-term, broader, consensus-based and independently-monitored plan.
Further delay in developing policy risked Britain losing out on critical green investments given the US subsidy scale available and the EU plans to follow this example.
Make UK said ministers should set up an independent inquiry in the form of a royal commission as a starting point for drawing up a new plan. It should also restore the Industrial Strategy Council, also abolished in 2021, supported by a statutory statute, responsible for monitoring the new strategy.
He also said that the responsibility for policy coordination across government should be entrusted to the Cabinet Office rather than the commercial department.
In the past, governments have appointed royal commissions to deal with high-profile social concerns or issues of national importance such as gambling or long-term care for the elderly, but the procedure has fallen out of favor these last years.
Make UK argued that a royal commission would ensure that a long-term industrial strategy is in place and would be less affected by the short-term political decisions of any party in government.
In a report published on Tuesday on the sidelines of its recommendations, the professional organization highlighted the piecemeal approach of successive governments, which have produced six growth plans since 2012. In addition, the department responsible for steering industrial strategy has been reorganized five times over the past 15 years. years and the same number of company secretaries over the same period.
According to the report, nearly 60% of manufacturers said the government never had a strong vision for manufacturing, while two-thirds said the lack of an industrial strategy hindered access to skills.
Eight out of 10 companies believed that the lack of a strategy put them at a disadvantage compared to other manufacturing countries.
Last year, the manufacturing sector accounted for about 9% of total economic output. Make UK said it wanted to see the sector’s contribution reach 15% of GDP, which it said would add a further £142 billion to annual output, creating high-skilled and high-value jobs.
The government said it had “shown a clear strategy for British manufacturing with a variety of schemes which ensure the automotive, aerospace and low carbon technology sectors have access to finance, talents and the infrastructure they need”.
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