Ministers’ plans for a new industrial strategy document have been abandoned as they focus instead on a post-pandemic, Treasury-led growth programme to be announced by chancellor Rishi Sunak in the coming weeks.
The new “plan for growth” strategy will take in work by officials at the business department, who had been rewriting the 2017 industrial strategy since last autumn as part of a push by Dominic Cummings, the prime minister’s former chief adviser, to put technology and innovation at the heart of the UK’s economic future.
That work by the business department was designed to update the industrial strategy produced under prime minister Theresa May in 2017. Since then, there have been a number of big changes, including the government’s adoption of the 2050 net zero target, coronavirus and the post-Brexit trade deal with the EU.
The chancellor’s new programme will set out medium-term proposals to boost skills and investment in the post-pandemic landscape — highlighting growth areas that deserve extra government intervention.
The new Treasury-led strategy draws on work across Whitehall and will include a section on transport infrastructure, regulatory reform, innovation and the low-carbon economy as well as the digital economy.
One person close to the process said: “The previous industrial strategy was three years ago, since then we’ve had Brexit, Covid and net zero, it needs to be looked at again, whether it is called ‘the industrial strategy’ or not is immaterial, that’s just branding, what is important is that there is detailed policy work going on in these crucial areas.”
Some manufacturers were concerned that any plans will be light on how to support parts of the more traditional economy that make and export products in complex supply chains that have already been hit by Brexit.
The “plan for growth” will highlight a number of priority areas, although two people familiar with the work done so far said that it was more likely to focus on a vision for the future rather than yield specific policy or regulatory changes.
One official added that teams have only had since the start of the year to come up with as detailed a document as possible to map out the UK’s future after the pandemic. Ministers are looking for ideas about how to help kickstart and rebuild the economy post-pandemic after more than a year in full or partial lockdown.
The annual report by an independent council that oversees the industrial strategy last year found that “good progress” had been made towards implementing the 142 policy commitments made in the 2017 white paper.
In total, £45bn of financing had been assigned to industrial strategy initiatives — but the report said most was allocated to a small number of projects.
“This means many of the policy initiatives in the industrial strategy have little, or no, financing attached to them. As such, they are very unlikely to have a material impact on the economy’s performance. There is also little evidence, so far, of the industrial strategy having led to significantly improved policy co-ordination across government.”
The council said a “refresh and reprioritisation of the industrial strategy would be desirable if it is to meet its longer-run objectives”.