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The plan, launched today by Business Secretary Greg Clark, sets out a long-term vision for boosting the economy, building on the company's strengths and embracing opportunities of technological change.
Over the next three years, the government has committed to investing a further £725m in the Industrial Strategy Challenge Fund (ISCF) to respond to challenges and opportunities faced by the UK. This includes £170m to transform the construction sector and create new 'affordable' energy-efficient places for people to live and work, as well as up tp £210m to improve early diagnosis of illnesses and develop precision medicine.
In addition, first 'sector deals' have been agreed across the construction, artificial intelligence (AI), automotive and life sciences industries to boost growth and equip businesses for future opportunities.
Overall, the White Paper focuses on the five foundations of productivity – ideas, people, infrastructure, business environment and places;
Ideas
• raise total R&D investment to 2.4% of GDP by 2027
• increase the rate of R&D tax credit to 12%
• invest £725 million in new Industrial Strategy Challenge Fund programmes
People
• establish a technical education system that rivals the best in the world
• invest an additional £406m maths, digital and technical education, helping to address the shortage of science, technology, engineering and maths (STEM) skills
• create a new National Retraining Scheme that supports people to re-skill, beginning with a £64m investment for digital and construction training
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Infrastructure
• increase the National Productivity Investment Fund to £31bn, supporting investments in transport, housing and digital infrastructure
• support electric vehicles through £400m charging infrastructure investment and an extra £100m to extend the plug-in car grant
• boost digital infrastructure with over £1bn of public investment, including £176m for 5G and £200m for local areas to encourage roll out of full-fibre networks
Business Environment
• launch and roll-out Sector Deals – partnerships between government and industry aiming to increase sector productivity. The first Sector Deals are in life sciences, construction, artificial intelligence and the automotive sector
• drive over £20bn of investment in innovative and high potential businesses, including through establishing a new £2.5bn Investment Fund, incubated in the British Business Bank
• launch a review of the actions that could be most effective in improving productivity and growth of small and medium-sized businesses, including how to address what has been called the 'long tail' of lower productivity firms
Places
• agree local industrial strategies that build on local strengths and deliver on economic opportunities
• create a new transforming cities fund that will provide £1.7bn for intra-city transport. This will fund projects that drive productivity by improving connections within city regions
• provide £42m to pilot a Teacher Development Premium. This will test the impact of a £1,000 budget for high-quality professional development for teachers working in areas that have fallen behind
To ensure that the government is held to account on its progress in meeting the ambitions set out in the strategy, an Independent Industrial Strategy Council will be launched in 2018 to make recommendations to government on how it measures success.
Business Secretary Greg Clark said: "The Industrial Strategy is an unashamedly ambitious vision for the future of our country, laying out how we tackle our productivity challenge, earn our way in the future, and improve living standards across the country."
Prime Minister Theresa May said: "Our modern Industrial Strategy will shape a stronger and fairer economy for decades to come. It will help create the conditions where successful businesses can emerge and grow, and support these businesses in seizing the big opportunities of our time, such as artificial intelligence and big data, whilst also making sure our young people have the skills to take on the high-paid, high-skilled jobs this creates."
Lord Adonis, Chairman of the National Infrastructure Commission, said: "It is significant that the strategy has a clear focus on developing new low-carbon technologies, but also that the first sector deals are in construction as we deliver major projects like HS2, and artificial intelligence technology which could transform how we operate and maintain our infrastructure.
"These will be key considerations as we work to deliver the country's first-ever National Infrastructure Assessment to tackle the 3 Cs of congestion, capacity and carbon for the country's long-term economic benefit."
(LM/MH)
