EEF hasn't run any events at the political party conferences for a while, but in the last set of conferences before the general election, and at a time when it is particularly vital to make the case for manufacturing, we are co-sponsoring events at both Labour and the Conservative conferences.   Both are outside the so-called 'secure zones' - i.e. you don't have to run the gaunlet of the tight security down there, so anyone can attend - and further details are below.

Joint EEF and Work Foundation event, labour Party Conference:

Do the British make anything anymore? Why the UK needs to nurture its manufacturing sector.

Panellists:

Rt Hon Pat McFadden MP, Minister of State for Business, Innovation and Skills
Stefan Stern, Financial Times
Stephen Radley, EEF
Ian Brinkley, Work Foundation.  

Tuesday 29 September, 12.45-2pm, The Old Ship Hotel, 31-38 Kings Road, Brighton, BN1 1NR.   


Joint EEF and Enterprise Forum event, Conservative Party Conference 

Looking to the future: the role of manufacturing in the UK economy. 

Panellists:

David Gauke MP, Shadow Treasury Minister
Patrick Minford, Professor of Applied Economics, Cardiff Business School
Stephen Radley, EEF

Monday 5 October, 12-1.30pm, Barbirolli Room, Radisson Edwardian Hotel Manchester, "Free Trade Hall" Peter Street, Manchester, M2 5GP.

The brothers and sisters at the TUC have been getting themselves exercised this week about when and how the government intends to implement the forthcoming Agency Workers Directive. 

Many in the trade union movement are desperate to get the proposal introduced, and in effect, before next year's general election in order to make it impossible for any future Conservative government to water down or even repeal it.

However, if they were hoping for some clarity on the matter when the Prime Minister stood up to address the TUC congress today, they may have been disappointed. 

Instead, he merely pledged to get the proposal onto the statute book before the end of the current parliament, with no mention of when it would actually come into force. 

This may sound like a matter of semantics, but it is an important point. 

The legislation will make it harder and costlier for employers to use agency workers to respond to increased demand at the very time when a recovery could be taking place.  Instead EEF has argued that the government should use the full implementation period (up to October 2011) before bringing these measures into force.  This would then allow the upturn to take hold, as well as giving companies the maximum time to adjust to the new requirements.

Of course, regardless of what the Prime Minister did, or didn't, say today it doesn't mean that the government wont go for early implementation - but this was hardly the definitive statement that the trade unions might have been looking for.   (Nor, in truth, has it provided the certainty that, for better or worse, would help business prepare for these changes.) 

For that we will probably have to wait till early next year, and after the results of a formal consultation this Autumn, when hopefully the government’s intentions will become a little clearer. 

EEF has launched a major report this morning - Manufacturing. Our Future. – which sets out our vision for putting manufacturing at the centre of a more diverse and durable UK economy.

In the light of recent economic events a consensus has emerged about the need to rebalance the UK's economy to end our reliance on growth driven by the City of London, cheap credit and public spending.  Politicians of all stripes have been talking the talk about the importance of manufacturing in this rebalanced economic nirvana, but they have been decidedly short on detail about what this means in practice. 

Manufacturing. Our Future. argues that the UK's future economic prosperity, and ability to face challenges such as globalisation, is inextricably linked to the development of a strong UK manufacturing base.  But this will not happen without a different approach by both manufacturers and politicians. 

For companies that means focusing on the future and evolving to become more innovative, agile and diverse. 

For policy makers, that means adopting a dramatically different mindset in order to create an investment-friendly business environment and directly support those markets and sectors in which the UK has potential to develop a sustainable competitive advantage. 

Here we will only deliver the type of economy we need and one that will be well placed to benefit from a world economy that will double in size in the next 20 years with a clear framework for action.  EEF sets out the guiding principles which will ensure the UK rebalances its economy and responds to strategic challenges as they emerge on the horizon.   

1.      Send signals: Companies entering new and developing markets need a clear signal about the government’s long term priorities.  Only then will manufacturers’ have the confidence to invest.  Government must signal the importance that government attached to specific technologies, markets or investments and the steps it will take to help them succeed

2.      Overcome obstacles: government must work with business to identify and overcome obstacles to the growth of new and developing markets, for example skills shortages, infrastructure requirements or bottlenecks in the planning system.

3.      Collaborative customer: Government is a major customer for business.  Its £175 billion budget offers significant purchasing power in new and emerging markets if deployed effectively.  But government must engage more closely with industry to convey its needs and support innovation in these areas.  This will require significant culture change if the public sector is to focus on long-term value for the economy rather than short-term cost savings.

4.      Target Investment:  Government invests in markets directly and also in areas such as skills and innovation that support these markets.  With the squeeze on public spending set to tighten, the government must be bold and strategic in its investment decisions.  This approach will require government to become better at balancing risk and outlining its decisions against a set of clearly understood criteria. 

By adopting this framework government will utilise its influence in markets more effectively and use it to deliver a dynamic, diverse and forward looking economy.  But this has to be backed with tangible policies and resources, including:

-          A re-established Industrial Bank tasked with investing in the future.

-          A £1billion innovation ‘X prize’ for the commercialisation of low carbon technologies.

-          More strategic use of procurement in new and emerging industries.

-          Progress on improving the business environment, specifically on the tax system, regulatory burden and skills infrastructure.

-          A more coordinated approach to expert guidance on economic challenges and responses through the National Economic Council.  

This initiative will be accompanied by a series of meetings and events for our members leading up to the next general election as part of a sustained EEF campaign to ensure that the interests of manufacturing are at the centre of the political debate. 

A bit more on George Osborne's speech which Jeegar has talked about below. 

In what Stephanie Flanders has described as 'surprising' remarks, he praised left-leaning economist, Will Hutton, talked of the need for the UK to take a more strategic approach to economic policy and had a bit of a pop at the financial services for its short-termist approach to investment.

Will Hutton, it should be remembered, wrote a best-selling book (The State we're in), which was required reading for the New Labour classes in the mid-1990s and criticised the UK's economic system (under the previous government) for encouraging short term rent-seeking, ahead of long-term investment. In today's speech Mr Osborne has appeared to agree and said that a Conservative government would take a longer and more strategic approach to investment in infrastructure, skills and investment.

In particular he talked about their plans to support investment in high-speed rail, a 'smart' electricity grid and carbon capture and storage. Here he claimed that the role of government would vary according to the nature of invesments. In some cases, such as nuclear, he sees its role as sending price signals that encourage investment, in others cases HMG might use regualtory incentives or direct investment through a revised PFI model.

He also talked about the need to get the banks to improve the supply of long-term credit to industry and said that his Party is looking at the viability of creating government institutions - such as an industrial bank - to do so. Nonetheless whatever the intervention, it is clear that this is a very different approach to recent policy, which has tended to focus on using government policy to simply address market failures.

Of course, whether this approach will be welcomed by the more free-market elements of the Conservative Party is another matter. But this speech, and the current government's recent talk about 'industrial activism', seem to suggest the emergence of a new consensus amongst policy-makers on the need for government to take a more active role in supporting key sectors where the UK could have future strength.

EEF will be saying more about this issue in the next few weeks, but as the UK heads to a general election the most important thing will be to hear how the political parties actually plan to do this in practice...

Jeegar has also been talking about the survey on News 24 this morning..

...those are the main messages from EEF's quarterly trends briefing published today.  You can hear our Head of Economic Policy, Lee Hopley, talking about it in the video above..

It's early days, but the government's car scrappage scheme seems to have given a bit of a boost to automotive demand.  The government has released figures today showing more than 35,000 orders since the announcement of the £2000 scrappage subsidy. This, they argue, equates to one scrappage scheme order out of every five new car orders in this period.

Certainly every time you turn on a TV there seems to be a new car advert urging consumers to make the most of the scheme and this will provide some much needed good news for the UK automtive sector as it hold its breath and awaits the outcome of the ongoing political manoeuvring around the GM decision...an annoucement, on which, is expected at lunchtime today

Superfoods in Southampton? Nanotech in Newcastle? Wind turbines in Wales (well Cardiff at least)?

That's the verdict of a new report published today by HSBC Commercial Banking and the Future Laboratory, a forecasting and strategy consultancy. The authors argue that new technologies and ways of working will transform the UK's business landscape and lead to new business hubs developing around emerging markets such as renewables and nanotechnology.

Many of these hotspots will be outside London and the South East. Dundee, for example, is predicted to become a centre for computer gaming, biotechnology and nutraceuticals’ (so-called 'superfoods' with health benefits). While Durham and Bristol (nanotechnology), Manchester (stem cells and robotics), and York (biotechnology) could also become hotspots for the technologies of tomorrow.

Of course, while this is an interesting excercise it is extremely difficult to predict these patterns with any great certainty. The report also overlooks existing developments in this area (the North East, for example, is already making great strides in attracting investment in the renewables industry; the same is true on nanotech in Yorkshire).

 Those points aside, however, the report does draw the right overall conclusion: the UK will not address some of the chronic imbalances in our economy unless we end our ongoing and historical regional disparities and grasp the opportunities of these kinds of new technologies. In the next few week EEF will be publishing a report which will have more to say on this subject...