Intelligence Briefing - 5 November 2010

Government SME measures good start, but more need on finance: EEF

EEF’s Chief Executive, Terry Scuoler, was a guest this week at a government Summit for Small Business which set out a package of measures to help the UK’s SME community. At an event attended by, amongst others, Vince Cable MP, the Business Secretary, Ministers set out a number of initiatives, including plans to make it easier to do business with the public sector and improve access to finance. It was also announced that former Trade Secretary, Lord Young, will lead on government efforts to promote enterprise. Commenting we welcomed the Coalition’s focus on promoting enterprise, but we feel this was a missed opportunity to simplify the many access to finance schemes that currently exist into a single, overall funding body.

For further information contact Stephen Radley, Director of Policy and External Affairs

Let us know your views on supply chain opportunities arising from the UK’s plans for infrastructure

EEF is one of four key stakeholders who have been invited by government to advise on an “infrastructure supply chains project”. The group’s aim is to map and communicate UK supply chain capabilities to support delivery of the National Infrastructure Plan published last month.

Involvement in this project gives us the opportunity to raise awareness of the UK manufacturing’s capabilities to support infrastructure delivery and highlight any barriers to participation in infrastructure markets currently facing members.

We will keep you updated on the Group’s work and if you would like to feed-in views on these topics please contact Roger Salomone, our Energy and Regulation Adviser.

Government must not repeat CRC mistake if it is serious about the low-carbon economy

We delivered a key note presentation this week at the IEMA annual conference, where we argued that the transition to a low carbon economy can only be achieved through a better partnership between manufacturers and government. We warned that this can only take place if the UK is the right place to invest, citing the recent lack of consultation from government on proposed changes to the CRC Energy Efficiency Scheme as sending a poor signal to business. On the latter we continue to work to get government to reconsider its Spending Review decision to change the basis of this scheme and raise over £1bn from business.

For further information contact Gareth Stace, Head of Climate and Environment

Looking ahead to 2011

The Coalition Government continues to stress the important role it sees for manufacturing in helping create a better-balanced UK economy. During 2011 EEF will keep campaigning to put these warm words into action.

As part of these efforts, we will be asking government to look at issues as diverse as the complexity of the tax system, access to finance and how to support growing manufacturing sectors.

We will also be looking at the all-important image of manufacturing, which is vital if we are to attract the brightest and best into our sector.

This will include our now-regular week of activity, Manufacturing Week, in the Spring to promote a positive view of what our companies do and bring to the economy.

There will also be no let up from EEF on the issue of regulation. We will continue to urge the government to avoid introducing costly regulation in areas such as the environment and health and safety.

We will also be urging the government to consider alternatives to legislation, in order to ensure that the knee-jerk reaction from policy-makers is not always to try and solve a problem by regulating it.

Closely linked to this too, will be an EEF campaign to promote productive and flexible manufacturing workplaces. This will address the costly issue of employment law, but also look inside the modern manufacturing workplace and see how we can address issues such as skills shortages, the demand from employees for more flexible work and the competitive pressures which drive new and leaner ways of working.

Finally, the climate change agenda continues to be a major issue for manufacturing and with the next major UN summit on this to be held South Africa next year, we will be running a sustained campaign to simplify much of the overlapping legislation in this area.

Throughout this period we will continue to keep members up-to-date and engaged with our activity through our website, blog, meetings and events such as our regular Brussels Delegation.

We’re always keen to hear from members their views and policy priorities so drop us a line and let us know what you think

In the news

Amongst this week’s EEF press coverage has been our response to the latest PMI figures The Manufacturer and the Guardian, whilst the latter also covered our response to the SME business summit and launch of the Regional Growth Fund, together with our response to the latest decision on interest rates by the Bank of England.

Week in review

	Manufacturing PMI	After falling for two months, the manufacturing PMI rose to 54.9 in October, from 53.4 the month before. This indicates accelerated growth in the sector and is well above the long-term non-recession average for the indicator. Growth was fuelled by an increased order intake and exports.
	MPC Announcement	The MPC voted to maintain the Bank Rate at 0.5% and the stock of asset purchases at £200 billion.
	Producer Price Index	Output prices for UK sales of manufactured products rose 4.0% in the year to October, though this was lower than the rise of 4.4% in year to September. Input prices rose by 8.0% over the year, the lowest annual rise since February 2010.

The week ahead

Tue 9th: UK Trade; Index of Production (Sep)

Wed 10th: Bank of England Inflation Report

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