The government’s Industrial Strategy needs a “refresh and reprioritisation” to meet its longer-run objectives, the Industrial Strategy Council has said.
On 19 February, it published its first evaluation of the strategy, finding that good progress had been made when it comes to implementing the 142 policy commitments set out in the 2017 White Paper. Most are in the delivery phase and around £45bn of financing has been allocated to Industrial Strategy commitments. However, a majority of this funding has been assigned to a small number of projects – including R&D and transport – which means many initiatives have little or no financing and stand to have little impact on the economy’s performance. Furthermore, the council found there had been little evidence of improved policy coordination across government as a result of the strategy.
It made a series of recommendations, zeroing in on several aspects of the strategy where further progress would be desirable, including the Grand Challenges. Here, the council explained a much greater degree of focus, financing and policy coordination was needed to meet the challenges – which include net zero – with only modest progress having been made up until now. On the government’s target for R&D expenditure – 2.4% of GDP for 2027 – it said that while it was a positive step, it was also ambitious. The R&D target should be one of a broader set of actions aimed at supporting and promoting science and innovation in the UK.
It also warned a strategic overhaul and expansion of training policies and institutions is needed to meet the future “unprecedented” skills challenge, while the government’s commitment to “levelling-up” the economy must be turned into an implementation plan that is consistently applied, appropriately financed and focussed on areas “left behind”.
Andy Haldane, Chair of the Industrial Strategy Council, said: “An effective Industrial Strategy is central to tackling some of the deep-seated structural challenges facing the UK economy, among them the climate crisis, “levelling-up” the regions, the skills deficit and the productivity puzzle. The Government’s Industrial Strategy, set out in 2017, has made good progress in implementing policies that support these objectives. But, at present, these policies are not yet operating with the consistency and coordination, nor with the scale, necessary to meet these challenges. With a new Government in place committed to meeting these challenges, there is a great opportunity to refresh and renew not only the Industrial Strategy but the entire economy”.