Government's Industrial Strategy is just re-announced policies & old spending commitments - Rebecca Long-Bailey

Rebecca Long-Bailey MP, Labour’s Shadow Secretary for Business, Energy and Industrial Strategy, responding to the publication of the Government’s Industrial Strategy today, said:

“This is a White Paper made up of re-announced policies and old spending commitments, showing once again that this is a Government short on details and new ideas.

“Nothing in the White Paper will help give businesses the certainty or incentives they need to invest in the face of the Government’s catastrophic handling of Brexit.”

“What detail there is concentrates on a few elite industries in which Britain already has an advantage, and will do nothing to help the millions of people who work in low productivity and low wage sectors such as retail, hospitality and social care, or those based outside the “Golden Triangle” made up by London, Oxford and Cambridge.

“After the Budget last week, the Government’s economic credibility has been shot to pieces. This White Paper falls far short of the change of direction needed to improve our dire productivity, income and GDP growth. Labour’s Industrial Strategy set out a radical programme of investment and genuine partnership between industry and Government, to build an economy for the many, not just the few.”

Ends

Notes to editors

The Government’s lacklustre Industrial Strategy cannot hide seven years of failure

The stated overarching objective of the Government’s industrial strategy is to make the “UK the world’s most innovative nation by 2030”.

This is reminiscent of the Tories’ 2015 manifesto promise to make the UK  “the most prosperous major economy in the world by the 2030s”. A commitment they were forced to drop because of their failure on the economy. Today’s industrial strategy will do little to catch up on the failure of the last seven years:

The Government’s so-called ‘five foundations’:

1)     Ideas: Raise total R&D investment to 2.4% of GDP by 2027

• o   Latest figures show total investment from Government, including research councils, is lower than in 2010.

(ONS, Total GERD by sector of performance: Government, 16 March, 2017

https://www.ons.gov.uk/economy/governmentpublicsectorandtaxes/researchanddevelopmentexpenditure/timeseries/glbk/gerd)

• o   Labour will invest in our economy, and reverse underinvestment, spending 3 per cent of GDP on R&D by 2030.       

2)     People: Establish a technical education system that rivals the best in the world

• o   Funding to adult further education (FE) and skills in England was cut by 8 per cent in cash terms and 14 per cent in real terms since 2010/11.

(House of Commons Library, Adult further education funding in England since 2010, 7 November 2017,

http://researchbriefings.parliament.uk/ResearchBriefing/Summary/CBP-7708 )

• o   Labour will invest in the skills of everyone and create a National Education Service for England. This will be a cradle-to-grave service that is free at the point of use built on the principle that ‘Every Child – and Adult – Matters’.

3)     Infrastructure: Increase the National Productivity Investment Fund to £31bn, supporting investment in transport, housing and digital infrastructure

• o   The UK was ranked just 9th the in the world in terms of the overall quality of its infrastructure in 2015, behind Germany (8th), France (7th), but ahead of the USA (11th), according to the World Economic Forum.

(House of Commons library, Infrastructure policies and investment, 27 June 2017

http://researchbriefings.parliament.uk/ResearchBriefing/Summary/SN06594) 

• o   A recent OECD study of infrastructure in the UK found that infrastructure in the UK has suffered from under-investment, compared with some competitor countries, since the 1980s

(OECD, UK economic survey 2015: Improving Infrastructure, February 2015 http://www.oecd-ilibrary.org/economics/oecd-economic-surveys-united-kingdom-2015/improving-infrastructure_eco_surveys-gbr-2015-6-en;jsessionid=3b36vj923n8hv.x-oecd-live-02

• o   Labour will invest £250bn over ten years to upgrade our infrastructure and boost  UK poor productivity.

4)     Business Environment: Launch a review of the actions that could be most effective in improving the productivity and growth of small and medium-sized businesses

• o   Output per hour worked in the UK remains 15.1% below the average for the rest of the G7 advanced economies

(ONS, Labour productivity: April to June 2017, 6 October 2017 https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/labourproductivity/bulletins/labourproductivity/apriltojune2017)

• o   In last week’s Budget productivity forecasts were cut this year, next year and every year of the forecasts.

(HMT, Budget 2017, https://www.gov.uk/government/topical-events/autumn-budget-2017)

• o   The truth is that the Tories have presided over a productivity crisis that is making us all poorer and they have abandoned SMEs. Labour’s National Investment Bank will identify where other lenders fail to meet the needs of SMEs and prioritise lending to improve the funding gap and to boost productivity.

5)     Places: Create a new Transforming Cities fund that will provide £1.7bn for intracity transport. This will fund projects that drive productivity by improving connections within city regions

• o   The National Infrastructure and Construction Pipeline. However, of the top twenty infrastructure and construction projects receiving the most funds, only two are in the North East, North West or Yorkshire and the Humber.

(National Infrastructure and Construction Pipeline, https://www.gov.uk/government/publications/national-infrastructure-and-construction-pipeline-2016 5 December 2016)

• o   Tory cuts to local government spending power across England are hitting the most deprived councils hardest. The six most deprived areas are all in the North, all of whom have seen cuts of more than three times the national average cut of £169. 

(Source: Labour party research on change in spending power per household from 2011/12 to 2019/20 based on House of Commons library and DCLG spending power 2016 -2017 statistics)

• o   Labour’s National Investment Bank, and Regional Development Banks in every region, will invest in every region.  We will legislate for a fair distribution of investment and we will devolve decision making through the Regional Development Banks, our Mayors, and regenerate the powers and resources available to local councils.