Over 7,000 UK manufacturers are set to benefit from a major government initiative aimed at tackling two of the sector’s biggest barriers to growth: high energy costs and limited access to finance.
The British Industrial Competitiveness Scheme (BICS), launched yesterday for an eight-week consultation, promises to reduce electricity bills for manufacturers by up to 25%, while a new £4 bn plan through the British Business Bank will provide scale-up funding for high-potential firms.
Business and Trade Secretary Peter Kyle unveiled the measures at the CBI Conference in London, highlighting the Government’s commitment to supporting domestic industry. “In recent years, our most promising innovators and industries have been hamstrung by some of the highest electricity prices in the G7 and poor access to finance,” Kyle said. “That’s been a drag anchor on growth. That’s a drag anchor on innovation. Today, we’re taking action.”
Targeted energy relief for key sectors
From April 2027, the scheme will deliver energy price reductions across high-growth sectors such as automotive and aerospace, as well as foundational industries within their supply chains, including chemicals. The move comes as British industrial electricity prices remain among the highest in the G7, posing a competitive challenge for manufacturers operating in global markets.
High energy costs are a consistent concern for UK manufacturers. According to Make UK and PwC’s 2025 Executive Survey, 51% of respondents said they expect their biggest challenege to be the high cost of energy, while 64% of firms in the Adam Smith Institute’s latest business confidence survey described energy costs as a “major concern.”
Supporting growth through finance
In tandem with energy relief, the government will enhance the British Business Bank’s role in supporting domestic scale-ups. The five-year plan will increase the Bank’s pace of investment by two-thirds, directing £4bn to firms in Industrial Strategy sectors to expand operations and remain in the UK.
Over five years, the initiative is expected to support 180,000 businesses, create 370,000 new jobs, and generate £68bn of gross value added to the economy.
Kyle emphasised the dual impact of the scheme: “I have listened to business on both these issues and today we’re taking action. This is just the start, and in the months ahead I will be going further to address business concerns, reverse our industrial decline, and make the UK the best place to start and scale a business.”
Leveling the playing field for UK manufacturers
The BICS consultation will determine eligibility and ensure that support is targeted at firms that can deliver growth, investment, and innovation. By lowering energy costs and improving access to finance, the government aims to strengthen the competitiveness of British manufacturers, attract new investment, and foster economic growth across all UK regions as part of the wider Industrial Strategy.
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