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The Business and Trade Committee, led by Labour’s Liam Byrne MP, oversees the work of the Department for Business and Trade, with a primary focus on scrutinising the Industrial Strategy and its implementation effectively. The committee includes 11 members from Labour, the Liberal Democrats, to the Conservatives.
WEAF has reviewed the comments from industry and governmental stakeholders on the priorities and challenges for the Industrial Strategy.
The ongoing inquiry into the Industrial Strategy aims to define the necessary government support to shape a modern industrial framework over the next decade. At recent sessions, where attendees provided oral evidence, focal points were on the UK exports to the US totalling £60 billion annually and the significant job risks if trade negotiations fail. Industry leaders also emphasised the urgent need for a clear industrial strategy to address rising energy costs, skills shortages, and potential job losses, particularly in advanced sectors like aerospace and biotech.
Key insights from experts, over the last couple of months, include:
- Stephen Phipson, Make UK CEO, who shared concerns about the direct and indirect effects of tariffs on demand and supply chain impact, particularly in the EU.
He commented on the necessity of stability within the markets influenced by the recent tariffs originally proposed by the US: “We do not know from one day to the next whether Trump is going to carry on, suspend or change. It makes planning your business and your investments extremely challenging.”
Since Make UK’s appearance at the committee on 22 April, there has been a trade agreement reached between the UK and the US whereby there will be no tariff on steel and aluminium, and car tariffs have now been cut to 10% from 25%.
- Colin Turner, WEAF CEO, said on this latest news.
“Aerospace remains one of the cornerstone industries in our region. The decision to lift tariffs on Rolls Royce engines and aerospace parts is a major boost for the entire supply chain.
“Equally significant is the reduction of duties on vehicle imports – excellent news for our growing automotive sector, especially as the South West prepares to host Jaguar Land Rover’s future battery gigafactory. We look forward to working with our partners on both sides of the Atlantic to turn opportunity into growth.”
- Professor David Greenwood, CEO of Warwick Manufacturing Group, highlighted in April the opportunities in rapidly evolving sectors like automotive and aerospace, urging for swift adaptation to regulatory and technological changes. He noted:
“The first thing I will say is that some of the areas where we see the greatest potential are also areas where the greatest changes are taking place. For instance, automotive, aerospace, defence and energy are all large-scale industries with big installed bases that can be mobilised relatively quickly compared with setting up something that we do not have at all.
“All of them are going through changes of one sort or another, whether it is a technology change, a regulatory change or a decarbonisation and circular economy challenge. Those sectors are certainly big enough to be able to move the dial quickly.”
- On 26th March, Maria Eagle MP, Minister of State for Defence Procurement and Industry at Ministry of Defence, presented to the committee on the need for long-term partnerships in defence procurement and the creation of a one-stop hub for SMEs to facilitate access to defence contracts. The Minister stated:
“The SME hub has not been fully designed yet, but the intention is to have a one-stop shop that a small or medium-sized enterprise can contact, if it thinks it might have something or wants to do work for defence. The hub will then be able to signpost them to some other initiatives within defence. For example, we are about to have the UK Defence Innovation Centre… It is going to be doing work to try to get new tech or dual tech involved in contracting.”
- On 13th May, addressing a committee question on regional inequalities, Jonathan Reynolds MP, Secretary of State for Business and Trade, said that the strategy will be more than a paper, the success of it will be marked by economic successes underpinned by companies pushing for the lead in their respective markets. The Secretary of State commented:
“We want innovation. We want dynamism within sectors where we would want the strongest firms to be challenging to get the greater market share… Our [the UK’s] brilliant pre-eminence in financial services, professional business services, in advanced manufacturing reflects sectors where most people would say there are good jobs, where we can’t be complacent. The analysis is where our strengths are, where there’s opportunities, and how government policy has to work to maintain those things.”
During the evidence gathering sessions this year, the committee has also explored lessons from Ukraine, emphasising the importance of procuring adaptable capabilities rather than static equipment, as technology rapidly evolves it was stressed that innovation must be able to adapt quickly as battlespace scenarios change.
From these sessions, evidence will feed into the framework for the Industrial Strategy. Industry leaders are stressing the urgency for a clear strategy to tackle rising energy costs, skills shortages, and job risks to support businesses in a volatile global environment. There is a need for a focus on importance of leveraging the UK’s industrial strengths to foster innovation and economic growth as these will be paramount in the enacting of the strategy.
Sources:
Demystifying the UK Government’s Industrial Strategy
British Steel – Hansard – UK Parliament
Automation: Economic Benefits – Hansard – UK Parliament
Business and Trade Committee: priorities – Committees – UK Parliament