x

Join our Mailing List

Subscribe to our mailing list to receive regular email updates of ResPublica's work, upcoming events and recent blogs from the Disraeli Room.

The Disraeli Room

The Disraeli Room

Blog Post

Industrial Strategy: A positive start but more must be done

26th January 2017

The Government revealed their industrial strategy this week, with three main aims:

  • Build on our strengths and extend excellence into the future;
  • Close the gap between the UK’s most productive companies, industries, places and people and the rest; and
  • Make the UK one of the most competitive places in the world to start or grow a business.

What followed were ten pillars of the industrial strategy, which aim to nudge the UK economy in the direction needed to reach these goals. The Green Paper is comprehensive and the Government has done well to select 10 areas which need attention. It is also undoubtedly a positive that the Government is thinking strategically and in the long-term interests of UK plc.

However, to make the industrial strategy a success it needs a Government that is accountable to the results on the ground and on this it is a golden opportunity missed. It needs the right metrics to measure productivity. The UK is, on average, 18% behind other G7 countries. As Chartered Accountants, we know that what gets measured gets done. So first among our recommendations is the adoption of a National Productivity target. It has worked for Singapore, propelling them to the highest income nation in Asia, and alongside other measures it can work for the UK in a post-Brexit environment. A productivity target is one of our three recommendations to Government to help engage businesses in the industrial strategy:

  • National Productivity target: Adopt a national productivity target of 2-3% growth to transform the government’s industrial strategy into a clear plan of action. This will give everyone a clear direction of travel. This should be accompanied by a serious discussion on the nature of the modern economy and how we measure productivity.
  • Supporting SMEs: Government needs to address the growing regulatory burden on small businesses. Costs from Making Tax Digital, increases to business rates, minimum wage rises and the apprenticeships levy all occurring within a short time frame is taking away from a business’s ability to reinvest. By focussing on sector deals there is also a risk that large business dominate discussion and government time and the benefits are not widespread.
  • Exports and trade: Introduce an export voucher to help businesses deal with the costs of exporting. It is encouraging the Government has made exporting one of the ten pillars, but more could be done to incentivise businesses. Recent ICAEW found that only 53% of businesses are exporting, and of those not exporting, 96% have no plans to do so in the future. More ambition might be needed from Government to make a noticeable different in those disappointing figures.

The Government has made a positive start but more needs to be done. It must make itself accountable for the industrial strategy and ensure that the results are widely spread. It needs to engage businesses up and down the country, not just those who shout the loudest or already have the deepest pockets. We look forward to working with Government to achieve those aims.

 


Leave a Reply

Your email address will not be published. Required fields are marked *

Time limit is exhausted. Please reload CAPTCHA.

The Disraeli Room
ResPublica’s Response to the Industrial Strategy White Paper

Following the creation of the Department for Business, Energy and Industrial Strategy in July 2016 and firing the starting gun for a string of sector...

The Disraeli Room
ResPublica’s Response to the Autumn Budget 2017

The second Budget of 2017 delivered by Philip Hammond following the abolition of the Autumn Statement, was widely trailed as a tight political tightrope for...

Child Protection in the Digital Age

I was delighted when the Government introduced its Digital Economy Bill in the last session which gave effect to the 2015 General Election manifesto commitment...

A stake in it for everyone; why Conservatives should support regulation of Fixed Odds Betting Terminals

FOBTs or B2 machines are highly addictive, one way we know this, according to research conducted by the Campaign for Fairer Gambling, is that FOBT...

Championing renewed leadership in governance and business practice

It didn’t get to the point where we saw ‘Save Unilever’ held aloft on placards outside Downing Street, yet there was widespread unease about Kraft’s...

Industrial Strategy: A positive start but more must be done

The Government revealed their industrial strategy this week, with three main aims: Build on our strengths and extend excellence into the future; Close the gap...

Who can give the modern Cathy a home?

It’s 50 years since Ken Loach’s groundbreaking film, Cathy Come Home, documented the inhuman effects of homelessness. Without a home, as his heartbreaking film shows,...

We need a manufacturing resurgence more than ever. How can we bring it about?

There’s been a familiar narrative emerging since Thursday’s vote – this was the left behind white working class getting one over the London-centric political and...

The economic impacts of a Brexit would make us more, not less, reliant on other countries

Yesterday’s letter from Ford to its employees was the latest chapter in the economic debate on Britain’s EU membership, which has largely focused on the...