The Secretary of State for Business, Energy and Industrial Strategy today unveiled the Industrial Strategy White Paper – and it is built around the principles of retooling the national economy for a productive, growth-oriented future, addressing the structural obstacles we face as a country and presenting a series of Grand Challenges which industry, research leaders, Government and civil society must work together to address.
What’s in the White Paper?
Some of the concepts and interventions presented in last weeks’ Budget – the commitment to uplift and extend the National Productivity Investment Fund; the increase in R&D expenditure tax credit; and the further £2.5bn fund for innovative and high-potential businesses incubated through the British Business Bank – have been given additional colour in today’s document; as has the underpinning commitment to increase investment in R&D to 2.4% of GDP and beyond over the coming decade.
But across the five foundations of productivity widely trailed before the Strategy’s publication – ideas, people, infrastructure, business environment and place – there are multiple new interventions of relevance to the Hub and its stakeholders, and we plan to engage closely with Government and others to breathe life into the Strategy’s bold ambition to make the UK the most innovative nation in the world by 2030. And the new programme of Grand Challenges in artificial intelligence, clean growth, the future of mobility and our aging society bring national priorities into sharp relief.
Challenge Funds and Strategic Priorities
New investment in the Industrial Strategy Challenge Fund, with an additional £725m to capture the value of innovation; a new competitive Strategic Priorities Fund, to support innovative R&D otherwise at risk of being missed; additional grant funding for Innovate UK; and a competitive ‘Strength in Places’ fund, building on evidence emerging from the Science and Innovation Audits; and the £1.7bn ‘Transforming Cities’ Fund, building the physical connections that can help to diffuse the outputs of growth.
Each measure represents Government, and willing actors in the ecosystem, seeking to address the issues we all face: the need to rebalance the economy and address underperformance in disadvantaged areas; the challenge of comparative low productivity per hour worked; and the new economic reality emerging post-Brexit. And sector deals in construction, life sciences, AI and automotive industries represent an opportunity for players to congregate around some of the emergent opportunities which will help us build a resilient economy for the future.
The Hub and the White Paper
Through the Science and Innovation Audits as referenced above – and the primacy of Local Enterprise Partnerships in developing local industrial strategies, in areas without a Mayoral presence – we also see here the increasing prominence of local actors in leading the way on growth and productivity, using the tools and information available at their fingertips – tools and information the Hub seeks to enhance and augment.
These are all encouraging interventions but they will need the commitment of industry, local partners and national agencies to lead the way. The Hub will explore the Industrial Strategy – its opportunities, challenges and ambitions – in more detail over the coming weeks, with commentary and expanded reflections on individual themes and interventions to follow soon.