The Industrial Strategy one year on

One year ago, the government published its Industrial Strategy. The strategy outlined the importance of business and government collectively working together to create a stronger, fairer economy to increase productivity. This included creating the right conditions for enterprise to grow and create good jobs, and building a Britain fit for its future outside the EU.

The current industrial strategy is the right approach, but government needs to pick up momentum and ensure it remains a long-term strategy for successive governments to embrace by measuring progress.

One year on, and progress has been made in delivering the long-term vision and strategy. But, with Brexit just around the corner, we need a renewed pace and fresh impetus from government, now more than ever.

Regional disparity

This year, the Tees Valley was announced as one of five areas across England which will form part of the second wave of local Industrial Strategy trailblazers. It’s good news for the region. The North East can put the principles of the Industrial Strategy to work and use it to grow as a place of world-class innovation, skills, and infrastructure.

But huge disparities remain across the UK. The most productive area of the country is now almost three times more productive than the least. Not through a lack of expertise or enterprise, but through a lack of investment in infrastructure, skills, and R&D.

When it comes to productivity, nine out of 10 UK cities outside London perform well below the European average. As referenced in the CBI’s Unlocking regional growth report last year, it is fundamentally important that the industrial strategy unlocks economic growth across the entirety of the UK. By closing the gap between the worst and best performing regions, we could add more than £200bn to the UK’s nominal GVA over the next decade.

If you boil the concept of Industrial Strategy down to its essence, it’s the simple idea that governments and businesses can plan for the long-term. The idea that investment in certain industries, sectors, and places can act as accelerators for a region’s economy, triggering further investment and gains in productivity.

Next steps

A year since its launch, business is firmly behind the strategy and is determined to help it succeed to drive productivity and growth in all regions across the UK. In places, it’s already working well, but in many others it could work much better. The government must continue to act. There still needs to be a concise and compelling vision for the coming years to align government and business leaders. There must be set of specific, tangible outcomes the industrial strategy must deliver in each region, with a measurable deadline against which we can test success. There also needs to be greater collaboration across all government departments, regions, and local authorities.

For the strategy to be a success, it also requires buy in from those working across UK and local governments as well as cross-party support so that it has the longevity to make a meaningful difference. There is also an opportunity to bring more impetus to the grand challenges by having more government attention matching that of the private sector, and by also clearly setting out the UK’s role in addressing these big global challenges.

Delivering a modern industrial strategy that will make the UK the best place in the world to invest, innovate and improve living standards is possible with sustained momentum. The CBI will continue to press government to ensure the strategy receives its required longevity through a clear vision, joined up thinking and bringing further energy to the major challenges facing the world during this fourth industrial revolution.