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Industrial Strategy White Paper

The Government published its Industrial Strategy White Paper last month and these are the mains points that have been summarised.

Summary of White Paper

  • The Government sets out five foundations of productivity – Ideas, People, Infrastructure, Business Environment and Place.
  • Four initial Grand Challenges are included in the White Paper – Artificial Intelligence (AI) and the Data Economy, Future of Mobility, Clean Growth, Ageing Society.
  • Sector Deals are being established and rolled out – the first four are Life Sciences, Construction, AI and Automotive.  More will follow.  
  • An independent Industrial Strategy Council will be formed to oversee progress and make recommendations to Government.
  • Local Industrial Strategies will be produced to build on local strengths to deliver economic opportunities.

Summary of Key Policies

  • 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
  • Invest an additional £406m in STEM skills
  • Create a new National Retraining Scheme that supports people to re-skill, starting with a £64m investment for digital and construction training
  • Increase the National Productivity Investment fund to £31bn
  • £400m for electric vehicles charging infrastructure and £100m to extend the plug-in car grant
  • £1bn of investment in digital infrastructure including £176m for 5G and £200m for full-fibre networks
  • £20bn of investment in high potential businesses including establishing a £2.5bn Investment Fund in the British Business Bank
  • Launch a review of the actions needed to boost productivity
  • Create a Transforming Cities fund that will provide £1.7bn for intra-city transport
  • £42m for a Teacher Development Premium

Grand Challenges

The Grand Challenges have been developed following the Green Paper consultation. Namely –

  • To put the UK at the forefront of the artificial intelligence and data revolution
  • Maximise the advantages for UK industry from the global shift to clean growth
  • Become a world leader in shaping the future of mobility (connected and autonomous vehicles)
  • Harness the power of innovation to help meet the needs of an ageing society

Liverpool City Region has significant strengths in AI/Big Data (Hartree/IBM Watson) as well as the future of mobility (VEC), clean growth and health innovation.

The LCR will need to articulate how it maps across these Grand Challenges.

Business Environment

The White Paper is addressing some key challenges –

  • Access to finance
  • Better connecting supply chains
  • A more even spread of productivity (not just the big firms)
  • Increasing collaboration

The White Paper sets out some specific examples –

  • Ensure all businesses have access to a Growth Hub in all LEP areas in England (increased funding)
  • Work with LEPs, Growth Hubs and Universities to support high potential businesses to scale up
  • A review of actions that will stimulate productivity and growth (to be completed Autumn 2018)
  • Launch a new Supply Chain Competitiveness programme
  • Encourage industry leaders to adopt the best practice of the automotive industry to increase UK content
  • Undertake a review of Export Strategy
  • Establish nine UK Trade Commissioners each developing a regional trade plan

LCR 4.0 and the Manufacturing Growth Fund are already embedded in the Liverpool City Region Growth Hub as an example of good practice –

The Making It Board will be instrumental in helping the LEP and Combined Authority feed into and adopt the above recommendations.

 Sector Deals

The Sector Deals announced in the White Paper are Life Sciences, Construction, Artificial Intelligence and Automotive.

The AI Sector Deal is concerned with the creation of “Data Trusts” as platforms to encourage companies to share data securely. The Industrial Strategy also announces a £45m investment to support additional PHDs in AI and related disciplines.

The Automotive Sector Deal is concerned with electrification, connected and autonomous vehicles (CAV) and supply chain (growing UK content as well as the introduction of an industry led supplier improvement programme).

The LCR has significant strengths in AI, Cyber Security and Computer Science via Hartree and our HEIs.

The LCR also has significant opportunities in the Automotive Sector Deal via our HEIs, Hartree and the NW2 collaboration with the Cheshire and Lancashire LEPs and the Welsh Government. The LEP inputted into the framework for National Manufacturing Competitiveness Levels (NMCLs) and wrote a letter of support to the Automotive Council.

There are further Sector Deals in advanced discussions (what is known as “Wave 2”) – Creative Industries, Nuclear and Industrial Digitalisation (“Made Smarter”)


Every region in the UK has a role to play in boosting the national economy. Local Industrial Strategies will be developed by Government with Local Enterprise Partnerships and Mayoral Combined Authorities.

Local Industrial Strategies will be developed locally and agreed with Government. These strategies will help identify priorities to improve skills, increase innovation and enhance infrastructure and business growth. This will guide the use of local funding streams and any spending from national schemes.

Local Industrial Strategies will be long-term, evidence based and aligned with national Industrial Strategy.

A Local Industrial Strategy will –

  • Identify local strengths and challenges and future opportunities
  • The actions needed to boost productivity
  • Address local skills issues
  • Harness the potential of world-class science and innovation
  • Support high value businesses
  • Identify leading sectors
  • Inform the development of Sector Deals

Government will agree the first Local Industrial Strategies by March 2019.  Priority will be given to areas with the potential to drive wider regional growth.

LCR 4.0 is an established platform to justify the wider regional growth requirement.

Places in England with a Mayoral Combined Authority will have a single strategy led by the Mayor and supported by the Local Enterprise Partnership.  The Government will make available to Mayoral Combined Authorities like ours a £12m fund to boost the Mayors capacity and resources (this was announced in the Budget last week).

The Government remain committed to Local Enterprise Partnerships.  From next year the Prime Minister will chair a biannual “Council of LEP Chairs” to provide an opportunity for LEP leaders to inform national policy decisions.

LEPs are being encouraged in the White Paper to collaborate across wider economic geographies to develop economic clusters.