The latest from the Black Country 

Black Country Chamber React to Industrial Strategy White Paper

Corin CraneFollowing the release of the government’s Industrial Strategy White Paper, Greg Clark, Secretary of State for Business, Energy and Industrial Strategy, has urged that now is the time for the UK to ‘seize the benefits of a new industrial revolution’. The Secretary of State has outlined his plan to target low productivity, which is ‘well below what can be achieved’ and ‘stops the UK achieving its potential’.

In terms of support for businesses, the White Paper set out key points such as the roll out of Sector Deals, which the government states are “partnerships between government and industry aiming to increase sector productivity”, the first of these deals are in life sciences, construction, artificial intelligence and the automotive sector. The publication also sets out the government’s plans to deliver over £20bn of investment in innovative and high potential businesses, which includes the establishment of a new £2.5bn Investment Fund that the document states will be “incubated in the British Business Bank”. With Brexit uncertainty continuously threatening to destabilise business confidence, the government is seeking to reassure firms across the UK. 

Corin Crane, Chief Executive of the Black Country Chamber of Commerce, commented: “In an era of such low productivity and political uncertainty, we welcome an industrial strategy that looks robust enough to go beyond individual business secretaries, and with a focus on ‘sector deals’ it means that we can look forward to ongoing partnerships between government and business in helping to set economic policy. We all want modern and globally focused businesses and there seems to be an acknowledgement that the reasons for poor productivity don’t lie at the feet of our innovative and hard-working local businesses, but is hugely impacted by infrastructure investment, skills and research and development support, most of which are out of the hands of local businesses.

“We are optimistic that the new Advisory Council will have powers that go beyond monitoring and that it will drive closer working between government departments. Most of all this will need resources – both human and financial – so what happens next is of the utmost importance.”

Regarding productivity, the document also states that the government will undertake “a review of what actions could be most effective in improving productivity of SMEs, including how to address the ‘long tail’ of less productive businesses”. The government has made clear its intentions to target productivity, which statistics show is lower than many of our EU neighbours. There is a feeling amongst businesses however, that a one-size-fits-all definition of productivity can be misleading and that a rethink of how we measure productivity may also be required.

On the topic of devolution, the White Paper also points to a continuation of the localisation agenda, explaining that “‘Local Enterprise Partnerships in England have provided a platform for local leaders and businesses to shape policies for their area” and that the role for communities throughout the country in driving productivity is a major component of the Industrial Strategy. The government has also set out plans to agree Local Industrial Strategies that “build on local strengths and deliver on economic opportunities”. The drive for further devolution is something that the Black Country Chamber has long supported, and the government’s commitment to this is something positive for Black Country businesses.

Centrally, the White Paper focuses on the five ‘Foundations of Productivity’, outlined as: Ideas, People, Infrastructure, Business Environment and Places. The changes to technical education, including the Apprenticeship Levy and the introduction of T-Levels will bolster the government’s commitment to simplifying a complex technical and vocational system, whilst there are also plans from the government to increase the rate of R&D tax credit to 12%. Concerning digital infrastructure, the government has announced their intentions to invest over £1bn of public funds directly into digital infrastructure projects, including £176m for 5G and £200m for local areas to encourage roll out of full fibre networks.

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