Govt unveils Industrial Strategy to boost UK productivity

Posted on 27 Nov 2017 by Jonny Williamson

Business Secretary Greg Clark has today (November 27) launched the government’s new Industrial Strategy for the UK.

The Industrial Strategy is setting out a long-term vision for how Britain can build on its economic strengths.- image courtesy of Depositphotos.
The Industrial Strategy is setting out a long-term vision for how Britain can build on its economic strengths.- image courtesy of Depositphotos.

The Industrial Strategy sets out a long-term vision for how Britain can build on its economic strengths.

It addresses the country’s productivity performance, embrace technological change and boost the earning power of people across the UK.

In its strategy, the government has identified four ‘Grand Challenges’ – global trends that it believes will shape rapidly changing future and which the UK must embrace to ensure we harness all the opportunities they bring.

  • Artificial intelligence – putting the UK at the forefront of the artificial intelligence and data revolution
  • Clean growth – maximising the advantages for UK industry from the global shift to clean growth
  • Ageing society – harnessing the power of innovation to help meet the needs of an ageing society
  • Future of mobility – becoming a world leader in the way people, goods and services move

Each challenge represents an open invitation to business, academia and civil society to work and engage with the government to innovate, develop new technologies and ensure the UK seizes these global opportunities.

Juergen Maier, CEO Siemens UK, commented: “Through today’s Industrial Strategy announcement we are optimistic that through greater investment in R&D, and especially through the application of advanced industrial digital technologies like AI and robotics.

“We can support many more new and existing manufacturing industries – raising productivity and creating thousands of new highly skilled and well-paid jobs.”

EEF Chief Executive, Terry Scuoler said: “The introduction of a new Industrial Strategy is key to supporting efforts to improve productivity and invest in not just current industries, but those of the future which are set to radically change the ways in which people live and work.”

The strategy reflects this engagement with a new and unique partnership between government, academia and industry, supported by policies that are committed to making the UK economy more productive and giving it a competitive edge in the future and abroad.

Five foundations

The white paper focuses on the five foundations of productivity – ideas, people, infrastructure, business environment and places – with a clear and complementary vision for each.

Each foundation is supported by a range of policies designed to provide businesses with certainty and reassurance that the UK will continue to have a competitive edge, including:

  • raise total R&D investment to 2.4% of GDP by 2027
  • increase the rate of R&D tax credit to 12%
  • invest £725m in new Industrial Strategy Challenge Fund programmes to capture the value of innovation


The strategy seeks to establish a technical education system that rivals the best in the world to stand alongside the UK’s world-class higher education system.

The government plans also to invest an additional £406m in maths, digital and technical education, helping to address the shortage of science, technology, engineering and maths (STEM) skills.

Another priority is the creation a new National Retraining Scheme that supports people to re-skill, beginning with a £64m investment for digital and construction training.

Nick Bridgens, systems manager at Advanced Seals and Gaskets Limited, said: “I am glad to see an investment to reverse the downgrading of technical education and major push in STEM education and STEM skills retraining.

“Without those skills in the hands of our young people, we are never going to be able to seize global opportunities.”


The government wants to increase the National Productivity Investment Fund to £31bn, supporting investments in transport, housing and digital infrastructure.

It is also planned to support electric vehicles through £400m charging infrastructure investment and an extra £100m to extend the plug-in car grant.

And, the government will boost the UK’s 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 .


The strategy seeks to build local industrial strategies that build on local strengths and deliver on economic opportunities.

The white paper suggests to 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.

Furthermore, it is planned to 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.