UK Industrial Strategy over the last 15 years can be characterised as inconsistent, with start-stop initiatives linked to changes in political leadership. However, all these initiatives share the same common features:
- Macro-economic approaches without any underlying insights into how growth is actually created, which has meant tracking the latest ‘technology fashions’
- Focus on specific ‘industry sectors’ based on pressure from large players, mostly multi-national corporations
- Reluctance to articulate a clear role for the state, apart from the notion of enabling a debate, and only intervening in the extreme case of market failure, which is poorly defined
The 2016 UK Govt Paper on Industrial Strategy, which was the most serious attempt at government ‘intervention’ in the last decade, still embodies this thinking, as we observed in our assessment at the time.
In the intervening 8 years, we have seen a number of other interventions:
- The 8 Great Technologies which is an exercise in technology determinism
- The recognition that we need to understand how science and technology-based innovation can be commercialised
- Competing alternatives from other global actors (the US IRA, the EU Green Deal and the various Chinese and Indian initiatives) which we reviewed in our analysis last year
The recent Green Paper on Industrial Strategy from the new UK Government marks a very welcome change in the mood music around the development of a national industrial strategy which we warmly welcome.
We will be responding in detail to this Green Paper, and the detailed questions set out in it, over the next few weeks, but it is worth noting that this Green Paper was accompanied by several other announcements which also need to be reviewed in the context of how the UK can drive growth.
The announcement about the Industrial Strategy Council, which so far seems rather thin in detail although the appointment of a senior executive from the UK part of a large US multi-national to lead it confirms the lack of serious mid-size and large ‘indigenous’ players in the UK eco-system, which we plan to address in our response to the Green Paper.
The announcement about the Regulatory Innovation Office seems slightly strange, given the absence of any discussion about the key elements of effective regulation: markets, products and services, technology and data -for example, it is not yet clear how this might affect the ability to regulate the application of artificial intelligence across a wide range of market spaces, from media to lifesciences.
But the new Green Paper offers a refreshing start to shaping UK industrial Strategy, with detailed questions for discussion, which we will be responding to in the next weeks.