18 April 2017

  |  CBI Press Team

News

UK2030: Make UK most competitive economy in the world

Industrial Strategy should aim to narrow productivity gap between regions by 15% points

UK2030: Make UK most competitive economy in the world

At a time of unprecedented change, the CBI calls on the Government to set out a clear mission to make the UK economy more open, innovative and inclusive and, as a result, the most competitive in the world by 2030.

The UK’s leading business group believes that a modern Industrial Strategy with a clear sense of purpose will improve living standards and raise productivity. It should aim to reduce the productivity gap between the worst and best performing regions by 15 percentage points by 2030.

The CBI wants the Government to commit to setting other targets that will measure the success of the new strategy, including: income levels, employment rates, income distribution and how economic activity is dispersed across the country. Businesses in every sector and of all sizes are committed to working with the Government to make this happen.

The CBI has set out 6 main areas for action by the Government to deliver a modern Industrial Strategy:

  1. Build clear UK2030 vision: a uniting long-term sense of purpose 

The Industrial Strategy needs a clear vision supported by tangible Key Performance Indicators (KPIs) and a brand that galvanises all parts of the economy.

  1. Fix the foundations: skills, infrastructure, energy, a pro-enterprise tax environment

Government can help businesses of all sizes and sectors by improving skills policy, delivering infrastructure projects (small-scale and large-scale), establishing an affordable plan for emissions reductions and maintaining a stable tax framework. 

  1. Put innovation at the heart of the strategy

Our competitive advantage depends on our ability to develop and commercialise new ideas as well as the ability of businesses to adopt technology and become more productive.

  1. Empower regions and hold to account 

The Industrial Strategy must increase living standards for everyone living in the UK and enabling regions to develop and champion their own economic strengths is the best way to deliver it. 

  1. Keep sector strategies light touch and simple

Support for sectors should be based on clear criteria to ensure collaboration is genuinely productive.

  1. Make it last: clear performance indicators and independent monitoring

To be successful the Industrial Strategy must be long term in its outlook, measure progress against clear KPIs and be independently monitored to help ensure that it survives changes of Government.

In its response to the Green Paper, the CBI specifically urges the Government to:

  • Appoint an independent commissioner to ensure all regions of the UK have appropriate levels of devolution to deliver the Industrial Strategy
  • Build a ‘UK2030’ brand to energise and unite the public and private sectors towards success. The Government’s Great Britain campaign has shown in recent years how a powerful UK brand, initiated by the Government, can have a significant impact
  • Establish an independent monitoring body – similar to the Office for Budget Responsibility – to measure progress against specific performance targets and provide independent and impartial advice on where Government should concentrate its efforts
  • Publish simple and clear criteria for sector deals in the White Paper.

Carolyn Fairbairn, CBI Director-General, said:

“The UK is at the foothills of extraordinary change as we look to redefine our role in the world and adapt to rapid technological advances in the workplace.

“A new Industrial Strategy must aim to make the UK economy the most competitive in the world by 2030. 

“We must build on our leading knowledge base, drive a renaissance in our traditional heartlands of manufacturing and create a new wave of entrepreneurship by making the UK the easiest place to start and grow a business. By doing this we can raise productivity and improve lives in every community up and down the country.

“This vision should not be created solely by business, nor by Government. It must be created and owned by business, government and society together. To make this happen, it must be underpinned by a partnership between business and government that is the best in the world, based on trust and shared interest.

“This will be a significant driver of competitive advantage for the UK, ensuring that planning and execution is coordinated at every stage and that every investment moves our country and prosperity forward in a way that is fair and sustainable.”

On setting real targets, Carolyn said:

“The UK trails badly in the productivity stakes against many of our competitors, which affects people’s life chances across the country, and so we urge the Government to reduce the gap between the worst performing regions and the best by 15% points by 2030.

“The success of the Industrial Strategy must be determined by how it performs in raising people’s wages, creating jobs and delivering a wider distribution of economic activity across the UK. An independent body should be established to measure progress against real targets and identify where improvements are needed.”

On the importance of building the foundations of a competitive economy, Carolyn said:

“It will be essential to get the foundations right, from building a skills base for the next generation, to investing in infrastructure, energy and delivering a pro-enterprise tax environment.

“Many sectors will want to get involved and so the criteria for any new deal must be simple and clear. But we also need to refresh existing commitments where we have seen good news in recent years, such as in aerospace and automotive.

“The Industrial Strategy will need to empower our regions to develop and champion their own strengths, helping to lift economic activity throughout all parts of the UK.”