Industrial Strategy: government and industry in partnership

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1 Industrial Strategy: government and industry in partnership June #ind strategy

2 Industrial Strategy UK growth strategy* Strong, sustainable and balanced growth Deliver the most competitive tax system in the G20 Make UK one of the best places in Europe to start, finance and grow a business Encourage investment and exports as a route to a more balanced economy Create a more educated workforce that is the most flexible in Europe * The 4 ambitions from The Plan for Growth 2011, published by HMT and BIS alongside Budget 2011

3 Support for Manufacturing Growth Review Framework published December 2010 Published as part of Government s Plan for Growth. Actions seek to address: Improving Manufacturing Productivity Commercialisation of Technology Developing a skilled workforce Promoting the image of the sector Implementation complete. Next stage is measuring impact. Recent actions Advanced Manufacturing Supply Chain Initiative: Supports innovative projects where UK is well placed to take a global lead. Successful bids for Rounds 1 and 2 projected to secure or create 18,000 jobs. Additional 120m to run two further rounds secured. Round 3 closed; round 4 deadline 16 th October. Launched the reformed Manufacturing Advisory Service in January High Value Manufacturing Catapult, opened in October new university-based Centres for Innovative Manufacturing, to support emerging science in areas of strategic opportunity for manufacturing and address the long-term manufacturing research challenges. March announcement of 13 further successful bids to open University Technical Colleges, bringing total number of UTCs to 45. Foresight Manufacturing Project: 2 year project investigating future of manufacturing to 2050, reporting Autumn Annual Investment Allowance Temporary 2 year tenfold increase in threshold to 250,000 Further 1% cut in Corporation Tax to 20% in 2015 R&D tax credit rate for large company R&D increased to 10%

4 Innovation: Support for Manufacturing High Value Manufacturing a key Competency for TSB underpins a range of sectors TSB Portfolio > 50m, EPSRC Portfolio > 58m UK Strengths: Aero. Auto. Electronics, Life Sciences, MEMS, Satellites The Future Customised Manufacturing, Plastic Electronics, Advanced Materials (e.g. graphene) Further investment of 600m in Science and Innovation announced in Autumn Statement 2012 High Value Manufacturing Catapult Centre Capabilities Materials Manufacturing process technologies/techniques Welding/forming Industrial biotechnology Sectors Locations Strathclyde Advanced Forming Research Centre Wilton /Sedgefield Centre for Process Innovation Rotherham Advanced Manufacturing Research Centre Nuclear Advanced Manufacturing Research Centre Coventry Manufacturing Technology Centre Coventry Warwick Manufacturing Group Bristol National Composites Centre R&D Tax Credit: The largest source of Government support for business R&D: 1.1 billion (claimed on 10.9 billion of business R&D) by 10,290 businesses in 2010/11 Government increased the SME rate of relief to 200% in 2011 and to 225% in Large company rate is 130%. Number of claimants 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1, Amount Claimed m Number of claimants Amount claimed m

5 Skills: Manufacturing Engineering Skills shortage: Government working with industry to shore up the engineering skills pipeline. British employers currently face a workforce with insufficient skills which are critical to many industries of the future and to our international competitiveness. Project Team to report Summer Apprenticeships Apprenticeships are at the centre of our workplace training offer, delivering job-related, transferable skills. Focus on improving quality and quantity of apprenticeships, including developing more higher level apprenticeships. Support from key companies including Airbus, Shepherd Offshore and GM Vauxhall, who all stand to benefit from world class, nationally accredited training delivered in the workplace. Apprenticeship starts in manufacturing and engineering in 2010/11 totalled 48,970 up almost 30% on 2009/10 Apprenticeship Starts 20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 Apprenticeship starts 2010/ / /11 Academic Year Under 19 Provisional figures for 2011/12 show there 57,000 Apprenticeship starts in manufacturing and engineering. University Technical Colleges 45 UTC s now announced. On course to exceed commitment to establish 24 UTCs by already open, 27 due to open over September 2013 and Creates opportunities for more than 28,000 young people (14-19 year olds) to train as engineers, scientists and technicians of the future. 38 Universities and over 400 employers now involved in UTCs. Promoting STEM skills Strategy to promote and improve teaching of STEM skills in secondary and higher level education, including through STEMNET co-ordinating a range of activities between business and schools.

6 Strengthening Manufacturing Supply Chains Support to improve competitiveness of UK Supply Chain activity: Advanced Manufacturing Supply Chain Initiative: Launched in November million was available in the first two rounds. High demand in both rounds with over 70 bids seeking total funding in excess of 300M received. Successful bids are projected to create or safeguard over 18,000 jobs. Additional funding of 120 million for a further 2 rounds announced in the Autumn Statement. 26 new bids for Round 3 being assessed; application deadline noon on 16 October for Round 4. Manufacturing Advisory Service: New MAS service includes 7 million of funding to deliver supply chain activities over the next three years. Procurement and supply chain capability: government shifting to more strategic relationship with suppliers. Sector Strategies including a focus on UK Supply Chains and relationships with enabling sectors.

7 Image of Manufacturing A package of measures to help change perceptions of manufacturing. Made in Britain exhibitions focussing on success, capability and growth Queen Elizabeth Prize for Engineering launched 17 November 2011 Make it in Great Britain Campaign an exhibition of the best of innovative British manufacturing held at the Science Museum summer 2012 See Inside Manufacturing initiative that encourages young people to consider a career in manufacturing. First winners 1m bi-annual prize announced in March 2013

8 Exports Exporting forms a core strand of the Government s Plan for Growth The Government s ambitions: Doubling UK exports to 1 trillion a year by 2020; Getting 100,000 more UK companies exporting by 2020; Getting one in four UK companies to export (European average) rather than one in five at present; and Maintaining the UK s position as the most favoured location in Europe for inward investment and doubling the UK s stock of FDI to 1 trillion by 2020 UK exporters account for 70% of business R&D. UKTI will seek to double its client base to 50,000 over the next three years. SMEs key to improving export performance. National Export Challenge to get up to a further 100,000 SMEs to export. Initiatives include: Open to Export web resource, launched October 29, will provide SMEs with professional export advice allowing peer to peer advice and information sharing How to export guide for intermediaries to share with clients London 2012 Olympics & Paralympics widely regarded as the greatest Games ever, and showcased Britain at its very best to the world.

9 Industrial Strategy Industrial Strategy: government and industry in partnership Industrial Strategy: A Coherent, co ordinated approach Long term; Whole of government Partnership with business Consistent sector strategy framework Active co ordination All cross cutting work feeds into sectors, and vice versa One size does not fit all sectors will need different spectrum of support Core work streams 1. Sector strategies 2. Technologies 3. Procurement 4. Skills 5. Access to finance (Business Bank)

10 Industrial Strategy Government is: Supporting key sectors with potential for growth Supporting 8 great emerging technologies Big data Space technology Synthetic biology Advanced Robotics materials and nanotechnology Energy storage Agriscience Regenerativ e Medicine Working with business to help develop skills that businesses will need Working to improve access to finance for businesses Giving greater clarity on procurement opportunities

11 Industrial Strategy Basis for sector partnership choices Which sectors could make the greatest contribution to growth? Based on: Size and opportunity for future economic growth and employment Barriers to growth Scope for Government action Analysis published in September 2012

12 Industrial Strategy Strategic partnerships the sectors Published Summer 2013 Life Science Strategy (Dec 2011) and one year on update (Dec 2012) Aim: To make the UK the global hub for life sciences Agri tech Aim: increase inward investment and exports Aerospace (March 2013) Aim: Maintain existing UK market share; secure UK employment Nuclear (March 2013) Aim: Grow the global market share; set out role that nuclear plays in UK energy mix Construction Aim: make the UK the global leader in sustainable construction Oil and Gas (March 2013) Aim: Increase inward investment in energy supply chain Information Economy Aim: to seize the opportunities from new ICT technology Professional Business Services Aim: make the UK the global hub of expertise Offshore wind Aim: Build competitive and innovative UK supply chain Education Aim: Increase the UK's education exports Automotive Aim: Investment in R&D; grow and develop UK supply chain

13 Progress to date Progress highlights from the last six months Publication of life sciences one year on, aerospace, nuclear, oil & gas and Information Economy sector strategies; David Willetts set out in January 2013 how Government will use the 600m funding announced in Autumn Statement 2012 to support the 8 great technologies Round 2 of skills Employer Ownership Pilot, prioritising partnership sectors (closed 28 March 2013) First strategy update at Budget 2013 for the Business Bank, launching 300m investment scheme Updated procurement pipelines published in May 2013 unlocking potential contract opportunities across sectors worth nearly 79 billion The Industrial Strategy Council held its first meeting on 14 May

14 Progress Life Sciences Strategy Aim: To secure the UK s position as a global hub for health life sciences. BIS through the MRC and TSB will invest 310m to support the discovery, development and commercialisation of research. Promote through the Life Sciences Investment Organisation - the UK s status as Europe s leading destination for inward investment in the sector. Help smaller high risk early stage companies by introducing a new Seed Enterprise Investment Scheme (SEIS), offering a 50 per cent income tax relief on investments. Introduce an above the line R&D tax credit, to improve the visibility and certainty of R&D tax relief to attract large scale investment in innovation.

15 Progress Aerospace Strategy Aim: To maintain existing UK market share and secure UK employment. BIS and the Sector, through the Aerospace Growth Partnership (AGP) - Budget 2013 allocated 1bn to fund Aerospace Technology Institute, match funded by industry. Develop the aerospace Manufacturing Accelerator Programme - industry will scope the business case by the end of 2013/14. Tackle Access to Finance issues through the newly created Aerospace Finance Forum. The sector and UKTI will work together to develop a more strategic approach to identifying and pursuing opportunities in overseas target markets.

16 Progress Nuclear Strategy Aim: Ensure the development of a vibrant UK nuclear industry that is an area of economic and strategic national strength, providing the UK with a safe, reliable and affordable supply of low-carbon electricity. Invest 15m through UK Research Councils in equipment and access to Culham, National Nuclear Laboratory and Dalton Cumbrian Facility to facilitate research. Government (BIS/DECC) and Industry: Initiate cost reduction programme. UKTI to develop a strategy to increase the level of investment over time for all parts of the nuclear supply chain. UKTI to work with Nuclear Industry Council (NIC), the Nuclear Industry Association and other parts of the industry to develop an export strategy, involving other parts of government.

17 Progress Oil and Gas Strategy Aim: To maximise the economic production of the UK s offshore oil and gas resources. Map the UK supply chain, including exports, by value and destination, to determine areas of constraint and potential opportunities for additional support. Government and industry group which works to maximise economic recovery of the UK s offshore resources of oil and gas. Review supply chain position in relation to performance bonds. Industry to establish a national centre of excellence for technology. Establish a national programme to retrain ex-military personnel and those from other industries with the relevant transferable skills.

18 Progress Information Economy Strategy Aim: For the UK to be the best place in the world to start and grow a technology business and for all our companies and organisations to be confident and successful consumers of technology. Launching a new programme to help 1.6 million small and medium sized enterprises (SMEs) scale up their business online over the next five years. Academia and business partnering to develop a digital skills strategy. Promotion of innovative teaching tools in schools, using online learning platforms. Developing a new data capability strategy, allowing people, businesses and the public sector to identify innovative and more efficient interventions on big policy challenges such as education, public health or transport. Establishing the world s first facility for testing state of the art 5G mobile technology, working with industry and the University of Surrey.

19 Progress to date Progress technologies SevenCatapults o High Value Manufacturing, Cell Therapy, Offshore Renewable Energy, Satellite Applications and Connected Digital Economy are open o Future Cities and Transport Systems open by August 2013 Big data Space technology Synthetic biology Advanced materials and nanotechnology Supportfor eight great technologies o 600m funding in Autumn Statement 2012 Robotics Energy storage Agriscience Regenerativ e Medicine Patent Box introduced progressively from April 2013 will provide reduced corporation tax rate of 10% for companies exploiting patented inventions

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