The UK’s New Industrial Strategy: A 10-Year Vision for Growth

On Monday, the UK Government published its long-awaited new Industrial Strategy (the Strategy). The Strategy is a 10-year plan to significantly increase business investment in the UK in eight high growth sectors, by making it quicker and easier for businesses to invest and providing them with the certainty and stability needed for long-term investment decisions.

High Growth Sectors 

The Strategy focusses on those eight sectors that the UK Government has identified as capable of driving high growth in the UK economy. Those sectors are: 

• Advanced Manufacturing 
• Creative Industries
• Clean Energy Industries
• Digital and Technologies
• Financial Services
• Defence
• Life Sciences
• Professional and Business Services

Each high growth sector contains a number of what the Strategy calls Frontier Industries – for example, within the Digital and Technologies sector there is Artificial Intelligence and Semiconductors and within Advanced Manufacturing there are Batteries and Space.

There are/will be sector plans for each of these high growth sectors and it appears five of the eight are already available.

Making it easier to do business and invest

The Strategy outlines how the Government will make it easier and simpler for companies to do business in the UK, giving them the stability to make long-term investments. Measures include: 

• promoting free and fair trade, 
• tackling high industrial electricity costs,
• strengthening economic security,
• expanding access to finance, 
• driving innovation, 
• capitalising on the value of UK data, 
• enhancing skills and increasing access to talent,
• reducing regulatory burdens, 
• removing planning barriers, and 
• ensuring the tax system supports growth. 

Within each, the Government has committed to various targeted interventions. For example:

• In the strengthening economic security area, the Government has announced it will, amongst other things, launch a 12-week consultation on updating the definitions covering the 17 sensitive areas of the economy subject to mandatory notification under the National Security and Investment Act:
  • This review will be welcomed by many investors and businesses as it provides an opportunity to both update the sector definitions to reflect developments in technology and security risks since 2022 and to clarify current areas of uncertainty.  Areas of focus are likely to include the definitions for artificial intelligence, advanced materials (including semiconductors and critical minerals), data infrastructure, defence and life sciences. 
  • In another welcome move, the Government has also committed to announce specific exemptions to the mandatory notification regime. These exemptions could include ones announced by the previous government, who said they would introduce an exemption for the appointment of liquidators, official receivers and special administrators and undertake more work to consider the feasibility of exempting some internal reorganisations.  Details of the exemptions are expected shortly – watch this space. 
• In the enhancing skills and accelerating access to talent area ,the Government will improve business mobility by exploring ways to make it easier for British professionals to move temporarily between the UK, EU, and other international partners. 
• In the reducing electricity costs, accelerating grid connections and promoting industrial decarbonisation area, the Government will introduce a new British Industrial Competitiveness Scheme which will reduce energy costs for some businesses by exempting them from certain schemes (e.g. the Renewables Obligation). 

Other points

The Strategy also seeks to support the UK’s city regions and clusters alongside creating an “enduring” partnership with business. As it makes clear, the Strategy will only be effectively implemented if it is done in collaboration with business. 

Conclusion

There will be much work to be done to implement all measures and ambition contained within the Strategy. There will need to be legislation too – with the Strategy stating that the Government will introduce an Industrial Strategy Bill to implement measures that require primary legislation. As is clear throughout, the Strategy is a living document and a lot can change in ten years.