Yesterday saw Theresa May launch the government’s Industrial Strategy, with promises which included boosting growth across the whole country, investing in skills and education, and developing infrastructure.
The UK has not had such a strategy in recent years, which could be seen as an underlying cause of the decline in much of our manufacturing sector and contributing to the demise of the steel industry.
And while the Prime Minister’s lofty goals to support business and growth will be sold to us as positive ones, the strategy could be undermined by Brexit and the uncertainty this will bring over the coming years. If we are to leave the Single Market, businesses will find it harder to trade by being subject to complicated rules, and greater costs, unless a trade deal happens very quickly. As no one knows –even the Prime Minister – whether this is even possible, businesses could be left worse off. We don’t want to see a situation where government funding is filling the gaps left by leaving the Single Market, and not being spent on creating jobs and supporting business.
Uncertainty for our economic future has already been seen in the financial sector, with large employers announcing last week that they are thinking of moving jobs from the UK, reducing their tax contributions to our economy. In the North East one of our biggest employers – Nissan – has been persuaded to stay and we may now find out what was promised to them to make this happen. But what about Nissan’s supply chain? It is hard to see how Nissan can keep its costs down to give them an acceptable profit margin, and get the supplies it needs if the businesses that feed it start getting into difficulty or themselves relocating.
I was pleased to see that a new Industrial Strategy Challenge fund, designed to boost some of Britain’s emerging technologies, was part of today’s announcement. It isn’t new money, however, as forms part of the £4.7 billion that was announced for Research and Innovation last year. However, it may not be enough to reassure our Universities that they will retain their place as world class centres of innovation, and therefore leaders of developing such technologies. Their concerns, as I have heard first hand here in our region, are not just about funding but of continued access to the best talent and sharing of knowledge across the EU.
Likewise, as Tom Blenkinsop MP for Middlesbrough South & East Cleveland stated in the Westminster Parliament there are key elements missing from the strategy such as a Metals Catapult, a Carbon Capture and Storage plan and a commitment to primary steel making in the UK. All of which would boost job creation and productivity across our region.
What all this means for us here in the North East – with our large manufacturing sector – is anyone’s guess. We hear announcements of increased funding for the Northern Powerhouse but so far this seems quite North West-centric. I want to see policies which keep the region front and centre, gives us the best chance to boost trade, and build on our world leading tech and green energy industries. I hope this Industrial Strategy is up to the job.