· Sustained growth undermined by firms’ inability and reluctance to invest in innovation and skills, or utilise available support packages
· Makes recommendations to foster culture of ‘commonplace’ competitive business practices
· Urges Government-led, cross-party initiative to agree stable fiscal framework to promote investment confidence
· Calls for BIS to restructure internally and work more closely with trade associations
· Proposals for new business support pilots and expanded MAS remit
· Report result of cross-party inquiry by All-Party Parliamentary Manufacturing Group (APMG)
A new report published tomorrow (Wed 27th November) will warn that UK manufacturing is being prevented from becoming ‘wholly competitive’ by a national industrial culture that discourages companies from investing in vital long-term business drivers such as skills development and technological innovation.
The report, published by the All-Party Parliamentary Manufacturing Group (APMG), highlights many firms’ reluctance to engage with available support packages and business development programmes as further evidence of manufacturing businesses disinclination to seek advice and collaborate in order to grow.
The report is the product of a six-month inquiry by the APMG, chaired by Conservative MP Chris White and Labour’s Jonathan Reynolds MP.
The report calls on government to not only do more to create and foster a pro-investment culture in UK manufacturing, but to also restructure key interactions between manufacturing businesses and policymakers and take steps to build competitive business practices into manufacturers’ strategic thinking.
In particular, the report urges the Government to lead a cross-party initiative, in consultation with industry, to establish a ten-year fiscal framework designed to encourage manufacturing businesses to adopt more ambitious growth strategies based on longer-term investment. Crucially, the report calls on all political parties to honour the framework regardless of the outcome of the next general election.
The report further calls for the Department for Business Innovation and Skills to radically restructure its civil service manufacturing team, with vertical teams to better mirror and support supply chain sectors and ensure growth and stability of OEMs, with horizontal teams focused on size of company, rather than sector.
Further recommendations include:
· All parties should commit to protect funding for the TSB, EPSRC and Catapult Centres to 2020.
· The Cabinet Office should coordinate, with the Department for Business Innovation and Skills, pilot projects looking at take-up of business support policies, in advance of the full roll-out of the Business Bank.
· Government should work more closely with trade associations in the manufacturing sector, particularly those with a strong core of SME members, in the initial design of policy programmes, and subsequently in marketing programmes to their members.
· The Department for Business Innovation and Skills should collaborate with industry on a national campaign for automation, with a focus on myth-busting, making the case for automation and job creation.
· UKTI should be more targeted in its approach, and collaborate with existing bodies to promote export training where appropriate.
· The Manufacturing Advisory Service should undertake a review of its strategic management advice, and expand its remit in this area with more targeted support. It should work with organisations including business schools, trade associations and Chambers of Commerce, and partner with the Design Council and UKTI amongst others, to link strategic business advice to structural evolution of the business.
Speaking ahead of the publication of the report, inquiry co-chair Chris White MP commented:
“We know there are clear links between industrial culture and industrial competitiveness. If UK manufacturing is to be truly competitive in global markets we need a manufacturing sector brimming with outward-facing, confident businesses constantly looking to reinvest and innovate. This report lays out clear proposals for how the Government can bring about exactly that environment.”
Fellow inquiry co-chair Jonathan Reynolds also commented:
“The important question this report addresses – and the question we have asked throughout this entire inquiry process – is what more can government do to create a culture of competitiveness in which UK manufacturing businesses can grow. Recommendations within this report – around fiscal stability, business support, sector collaboration, awareness campaigning and funding protection and more – provide a map for how government can create precisely the industrial culture the UK needs to compete at the top of global manufacturing.”