Over the last couple of weeks both the government and EEF have put out some thoughts on industrial strategy. So what's the difference?
I think the biggest difference is in terms of ambition. When the government and many others talk about industrial strategy they talk about parts of the economy and parts of economic policy. So putting in place sector strategies perhaps with modest amounts of money associated with them is de rigeur.
By contrast while we see some role for the government providing support for a limited range of selected technologies, this is very much only a part of the picture. The Route to Growth is a strategy for the whole economy and tool to prioritise all areas of economic policy.
In this sense our strategy effectively subsumes not just the industrial strategy but an earlier government strategy still sadly little known outside Whitehall: The Plan for Growth.
The Route to Growth provides a clearer vision where we want the economy to head, suggestions for getting greater coherence across govt, and an accountability framework to match that in place for the fiscal mandate.
There are aspects of the government's industrial strategy which are positive. A closer look reveals admirable talks of giving companies a clearer view of government procurement guidelines to give British companies a better chance of winning government contracts. We support this aim. But where is the cross-government impact or reference to things like the MoD's procurement white paper or rewriting of the 'yellow book'?
On sector strategies, despite the evidence papers released justifying the selection of particular sectors, the process looks opaque. We think it would be better to focus on technologies, where the market failures are more easily identified and where technologies for potential support can be more transparently evaluated against clear criteria, such as:
- Potential size of future market
- Existing UK comparative advantage
- Range of applications
On this I don't necessarily think we are poles apart from the government but its a question of making the framework robust and therefore hopefully enduring.
The government's industrial strategy is good but could be so much better.