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Updated: North East businesses react to Theresa May’s Industrial Strategy plans

Following Theresa May’s Industrial Strategy revelations which dominated yesterday’s news, we’re interested in knowing how Britain’s new economic direction will affect the North East.

We already know that £50m has been allocated to the region to help propel plans for the International Advanced Manufacturing Park, whilst £21.8m has been allocated to the Tees Valley.

Moreover, we’ve seen how Teesside University has published its own blueprint for boosting business and employment in the Tees Valley.

Until we know more, we’ve compiled a dedicated business reaction roundup to help you gauge what the news means to businesses across the North East.

Reaction

Missed the news? For everything you need to know on Industrial Strategy - announcements, explanations and useful links - why not read our handy overview here before reading what the region has to say?

Sector Growth

The North East England Chamber of Commerce was especially pleased to hear of sufficient fund allocated for the region, particularly in supporting the development of the Advanced Manufacturing Park.

Jonathan Walker, Head of Policy, North East England Chamber of Commerce

“It’s heartening that the Government’s Industrial Strategy Green Paper seeks to put the voice of business at the centre of its ‘Sector Deal’ approach. North East England is a region with huge untapped potential, and by listening to the needs of the business community, Government has the chance to realise that potential and turn the region into an economic asset for the whole of the UK.

“Our region is already home to high-profile, world-leading companies and innovative, globally-competitive supply chains. The Government’s support for Sunderland and South Tyneside’s International Advanced Manufacturing Park is a great example of how further investment, and a focus on place, can build on the region’s strengths to drive growth, create new jobs and attract new businesses to an area.

“But it’s important that the Industrial Strategy does not become too focused on individual sectors and locations. North East England is a diverse region, with strengths stretching from the automotive sector, to renewable energy, to life sciences, to the digital and creative industries – these strengths must be harnessed, in partnership with our neighbouring regions, to benefit the UK economy as a whole. We will continue to challenge the Government to give a fair funding deal to the North East.

“This means offering the flexibility needed to support local growth, and continuing to listen to businesses and making the right investment in infrastructure and skills to meet their needs, as well as putting in place the right support to enable them to export and reach the best skilled talent overseas.”

Scaleups

The Entrepreneurs’ Forum has welcomed the appointment of Small Business Minister, Margot James, as the ‘Scale-up Champion’ as part of the Government’s Industrial Strategy.

Nigel Mills, Chairman, Entrepreneurs’ Forum

“The appointment of Margot James as Scale-up Champion is a positive development for growing businesses. The vast majority of new jobs created are in high-growth scale-up businesses, so removing the barriers that impede their growth is the best way the Government’s Industrial Strategy can create the wealth and opportunities in communities across the UK.

“By supporting scale-ups the Industrial Strategy would not so much be picking winners, but giving a boost to companies that are already on track to win, in effect putting its weight behind the most effective engine for job creation engine available.

“Ensuring that businesses have capable leadership, the talented people they need, access to finance, increased prospects for domestic and international sales, and infrastructure that meets their logistical needs, the Industrial Strategy can create the conditions for growth that will add billions of pounds to our economy and better prepare the country for the challenges and opportunities of the post-Brexit world.”

Robotics and automation

The Government’s commitment to support the growth of the UK’s robotics and automation sector is very welcome, says Blyth-based manufacturer Tharsus.

Brian Palmer, CEO of Tharsus

“Robotics and automation has the capacity to drive significant increases in the UK’s productivity, and help some very present social challenges such as caring for our ageing population.”

“Much like the internet has, robotics will yield a revolutionary change in how we work and live. It has applications in every commercial sector and section of society, and offers a great opportunity for the UK.

“The UK has first-class research universities and a leading high-value manufacturing sector. By supporting the development of the UK robotics industry, and the transition of research into commercially viable products, the UK can be a leading force in what will become a $100 Billion global market within the next few years.”

Skills

A key pillar in the Industrial Strategy is the government’s commitment to developing skills, especially in technical education.

Steve Grant, Managing Director of the TTE Technical Training Group

“The UK’s industrial capabilities have to be underpinned by a breadth of technical skills that can serve a variety of sectors.

“By placing the development of a skilled workforce at its heart, through relevant and forward-thinking training, the Industrial Strategy will help arm companies with productive and motivated people that have the abilities to help our economy compete in global markets.

“Skills also benefit communities by creating career opportunities, especially through apprenticeships, and the industrial strategy has a real opportunity to play a part in enhancing the prospects of the UK workforce.”

Tom Dower, UTC South Durham

“The focus on the North East as a region of growth for advanced manufacturing is very welcome; there are many wonderful manufacturing companies which are thriving here, though perhaps they don’t get the recognition that they deserve for their innovation and leadership in their sectors. The base is certainly there for significant expansion.

“Technical education is at the heart of a successful long term industrial plan and it’s already happening! A large number of companies are focusing on giving a great start to young people through University Technical Colleges. There are 50 across the country and UTC South Durham, on the Aycliffe Business Park, is the first in the North East.

“We are yet to see the detail of the industrial strategy. The technical institutes will only be successful if they are integrated with the rest of the education system and properly funded for the long term. But this is a welcome step in the right direction.”

Infrastructure

Brian Manning, chief executive of construction firm Esh Group

“The Government is right to say that resilient infrastructure is vital to economic growth and having a long term approach will be the most effective.

“Today’s paper reiterates the pledge to increase infrastructure spending by 60% from £14bn last year to £22bn in 2021. Coupled with the resumption of grants for new build homes announced in the Autumn Statement, this is good news for the construction industry.

“It was also encouraging to see a focus on procurement within the paper. Following Brexit we have a real opportunity to re-shape the way procurement works in order to benefit small and medium sized companies.

“Moves to extend the “balanced scorecard” approach to all major construction projects more than £10m are welcome.”

James Hall, partner at planning consultancy Barton Willmore

“It’s noticeable the North East is not mentioned in the key “upgrading infrastructure” section of the paper. That said, the region is well placed to benefit from promised support for connected and autonomous vehicles sector given its automotive expertise.

The vision for the International Advanced Manufacturing Park in South Tyneside will also benefit from the strategy’s focus on the vehicle sector plus improving digital infrastructure and the wider backing of local innovation strengths.

“Crucially, this Green Paper opens up new opportunities for place making and infrastructure delivery. One of the tools the Government has at its disposal in supporting the growth of industry is the planning system.”

Energy

David Stroud, Managing Director of Future Energy, the Newcastle-based energy supplier, welcomed the PM’s approach to affordable energy.

Mr Stroud said: “The Prime Minister is quite right to demand affordable energy for everyone. For too long national and international businesses have not given customers value for money and deprived the region of tax revenue. In the same way the process of devolution is having success in finding home-grown solutions to local problems, we need a regional approach to energy supply.

“Local suppliers, such as Future Energy, are a benefit to the regional economy. We employ local people, pay our business rates to the local council, and the savings we generate for our customers are spent locally, keeping that money in the region and driving economic growth in the North East. This is vital to the future success of the Northern Powerhouse, post-Brexit.”

George Rafferty, Chief Executive of NOF Energy

“The UK energy sector is one of the cornerstones of the economy and an effective industrial strategy will offer greater confidence in what British business can achieve. It will also be part of rebalancing the economy to maximise the capabilities of UK industry and enhance its role in the future prosperity of the economy.

“Building on its tremendous heritage, the energy sector supply chain has evolved to be at the cutting edge of developing technology-led solutions. An industrial strategy with focused, practical support and an emphasis on research & development will only serve to bolster companies and their ability to be world-leaders in their field.”

Productivity Gap

Chris McDonald, Chief Executive of the Materials Processing Institute

“The introduction of an Industrial Strategy demonstrates a commitment from both Government and industry to work together, to support long term inward investment, job creation and growth.

Government is right to focus on cross-cutting themes, such as innovation and infrastructure, which will tackle the productivity gap that has long been a challenge for the UK economy. It is now up to industry to respond by using the sector deals on offer, to invest in the advanced skills, technology and automation, to create the trade led growth Britain needs for the future.

“Additional funding and initiatives will capitalise on our World leading science and innovation capabilities, to boost R&D and product development. This is particularly true for the steel and foundation industries, which have the potential to become the most technologically advanced industries in the world.”

Graham Robb, Regional Chairman of the Institute of Directors in the North East

“The Government is right to create an Industrial Strategy, which will help to secure long term business growth and prosperity in the North East and across the UK.

“The Industrial Strategy is particularly important for our region, building upon our strengths by assisting North East companies find new export opportunities and ensuring they can access to the skills they need.

“The Government’s long-term approach, can keep North East businesses attractive to investors, while helping individuals and communities reap the rewards of increased productivity.”

Stephen Purvis, Chairman of Policy North and North East Entrepreneur

“This is a unique chance for us to start rebalancing growth from London to the North East. The good Industrial Strategy can ensure our region benefits from future plans such as greater investment in science, research and innovation, and upgrading infrastructure.

“We look forward to working with the Government to ensure the North is at the heart of its new Industrial Strategy. The North East has a real chance to start closing the gap with London and be at the forefront of making Britain a global leader in trade, building on our continuing industrial success, such as with Nissan in Sunderland.”

Have your say

What do you think? Will the North East benefit from the Industrial Strategy? Is there a particular pillar of the Strategy which the region must benefit from? Are you happy with May’s post-Brexit action?

Share your thoughts in the comments section below.

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