Britain’s lack of industrial strategy is a huge gap in our economic arsenal. While other countries run ahead, this government isn’t even in the race, and it risks Britain being left in the changing room without a change of course.
Under the Conservatives the UK economy has underperformed significantly on growth, productivity and wages. Turning this around, while forging a prosperous post-Brexit future and capitalising on the net zero transition, is at the heart of the economic challenge facing the next Labour government.
We will have to do so in a world where the US’s Inflation Reduction Act, and the EU’s Net Zero Industry Act and Green Deal Industrial Plan, will have radically altered the relative competitiveness of rival investment destinations. The UK is already bottom of the G7 for business investment. We in the Labour Party do not underestimate these challenges. But nor should anyone underestimate our determination to meet them.
Labour’s growing platform is credible and ambitious. It will refocus our economy and get Britain ready for the race to begin.
The first pillar is a new Industrial Strategy, with national missions addressing clean energy, data, care in an ageing society, and greater national resilience. Industrial Strategy is not about propping up failing companies, or “picking winners”, but about providing opportunity for British business.
And it must be a corollary to the short-term, inconsistent approach we have seen in recent years, providing stability, clarity and consistency so that businesses have the confidence to invest. And we won’t just publish a document that sits on a shelf in Whitehall, we will bring in an Industrial Strategy Council on a statutory footing to hardwire long-term economic thinking into the British economy.
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Underpinning our industrial ambitions is the Green Prosperity Plan, rising to the challenge laid down by the US and EU in the race to capitalise on the economic and human, as well as environmental, benefits of the green transition. Greater public investment is crucial, but Labour’s plan is to crowd in greater private investment in new industrial capacity, and use our new National Wealth Fund to manage public assets and investments.
We also need to make Brexit work. With the UK crying out for greater investment, and business crying out for stability, the level of uncertainty that would be created by reigniting old Brexit arguments would be counterproductive.
Labour’s plans to help food producers via a new sanitary and phytosanitary agreement, to remain a member of the Horizon Science Programme to assist our brilliant scientists, and to negotiate touring rights for our creative industries, are effective measures that would vastly improve our trading relationship with the EU without reopening old wounds.
We’ll also introduce a New Deal for Working People. Good work and good wages will be the driving mantra of everything Labour does on the economy. There will be no scandals under Labour like “fire and rehire” at P&O ferries.
Labour will also implement new plans for small business. The Start-Up, Scale-Up report, coauthored by Jim O’Neill, is full of ideas to ensure the UK becomes the best place in the world to start and grow a business, such as replicating the French “Tibi” Scheme, which brought institutional investors and venture capital funds together. Alongside reforms to business rates, more flexibility over the apprenticeship levy, and action to tackle late payments, we are serious about real reforms that will make a difference.
Labour will pull all levers needed to drive forward jobs and growth in Britain. We’ll invest to rebuild Britain’s industrial strength. We’ll harness the ambition and hunger of British business, the skills and talents of our workers, and create tens of thousands of high-skilled jobs, growing vibrant economies in all parts of the UK.
This piece first appeared in a Party Policy special Spotlight print issue. Read it here.