Plan builds on Brexit ambitions
May to unveil ‘industrial strategy for growth’
Prime Minister Theresa May is expected to build on her “global Britain'” ambitions when she unveils the UK government’s industrial strategy on Monday.
It is aimed at improving living standards, increasing the nation’s productivity and ensuring growth is shared across the whole UK.
Mrs May will outline the next steps in her ‘Plan for Britain’ and the need to tackle underperformance if the country is to create a country that works for everyone, not just the privileged few.
A package of investment for science and innovation is likely to form a key plank of the strategy which will dovetail with Mrs May’s views on building a post-Brexit Britain.
She will launch the strategy at her first regional Cabinet meeting, to be held in the north west of England, with simultaneous announcements by ministers around the country.
Jesse Norman, Minister for Industry and Energy, and Scotland Office minister Andrew Dunlop, will make a statement on the strategy during visits to a leather factory in Bridge of Weir, near Glasgow, and the Tennent’s Brewery in the east end of the city.
The Prime Minister said this weekend: “The modern industrial strategy will be about… the shape of the economy that we want in the future. Where are the successful sectors that we can help to encourage to grow?”
The strategy is likely to focus on what sectors the government believes have potential, how they will be supported, and how it intends to develop skills, infrastructure and research and development.
Business, Energy and Industrial Strategy Secretary Greg Clark said: “We are building a modern and comprehensive Industrial Strategy for the long term, which we are doing in partnership with businesses and workers across the country.
“We want to build on the UK’s significant strengths and excellence to shape our future economy.
“The UK has some of the best universities in the world and our schools are improving, yet for too long technical education for school leavers has been neglected – with large differences in skill levels between regions.
“We must improve skills and opportunities so we can close the gap between the best people, places and businesses and the rest.
“It is about making our country one of the most competitive places in the world to start and grow a business. We are inviting people throughout the UK to contribute to this work to create a high-skilled economy that works for everyone.
“The Government‘s Green Paper will set out proposals for discussion and consideration and invite views from a wide range of individuals, businesses and institutions across England, Scotland, Wales and Northern Ireland.”
Carolyn Fairbairn, CBI Director-General (above), said: “A modern Industrial Strategy will be a landmark opportunity to build a successful, modern economy as the foundation for a prosperous, fairer and more inclusive society.
“It must help fix the country’s productivity problems and remove the regional inequalities that have dogged our country for generations, having a positive impact on living standards, wages and the future opportunities of many people.
“The CBI has long-called for a new Industrial Strategy and it’s welcome to see the Government creating an opportunity for all sectors to get involved.
“Our members across every region and nation of the UK will have a fundamental role to play to help shape the thinking and – most importantly – deliver the impact we all want to see.”
SNP Economy spokesperson Stewart Hosie said that the huge economic threat posed by a Tory hard Brexit will “loom over” the Industrial Strategy speech.
Criticising the Tories for “seven years of mismanagement and failure” on the economy, the MP for Dundee East welcomed the “long-overdue” development of an industrial strategy but warned that the Tory plan for a hard Brexit was the single biggest threat to Scotland’s economy and long-term prosperity.
Highlighting the Tory government’s austerity cuts and its approach to immigration, the SNP also warned that the UK government’s wider policy agenda was “actively damaging the economy and holding back growth”.
Optimism continues to drop in financial sector
Sentiment amongst financial services firms deteriorated further in the three months to December, but there are signs of an improvement in business conditions over the next quarter for some sectors, according to the latest CBI/PwC Financial Services Survey.
The quarterly survey of 103 firms found that optimism about the overall business situation fell for the fourth consecutive quarter, the longest period of declining sentiment since the global financial crisis of 2008, and the sharpest fall since December 2008.
A more pessimistic mood was particularly prevalent among banks, with general insurers and finance houses also less optimistic. However, investment managers, life insurers and insurance brokers were more optimistic than they had been three months earlier.
Overall business volumes were flat in the last quarter of 2016, but are expected to pick up somewhat in the first three months of 2017, with stronger demand in the life insurance and investment management sectors contrasting with a more challenging environment expected by banks and building societies.
Growth in profits was also unchanged in the three months to December, but profitability is expected to improve across financial services in the next quarter, (with the exception of building societies), as cost pressures continue to ease.
Asked about the main challenges for financial services firms in 2017, a range of concerns emerged. Nine in ten banks saw preparing for the impact of Brexit as the number one challenge, but this was not the case in any other sector.
Building societies were most concerned about macroeconomic uncertainty, while the level of competition preoccupies the insurance sectors. Firms in every sector see the need to intensify their dialogue with regulators in response to uncertainty around Brexit.