The search continues for the UK's industrial strategy

I have just finished leafing through the 250 fun-filled pages of the government’s new industrial strategy, which was published earlier this week, looking to see whether the conflicting signals from the government about what it expects of business have been resolved.

On the one hand, one of the themes of the corporate governance reform package announced in August was the need for business to reintegrate itself into society, to be more diligent in its duties to its stakeholders, and more sensitive to the broader environment in which it operates.

However, suggestions from at least some ministers that the UK might become a ‘low tax, low regulation’ economy post-Brexit, and other indications such as the willingness to water down investor protection in order to lure Aramco to list in London, hint at a rather different vision of the future.

The prime minister’s foreword to the white paper aims to place it firmly in the first camp, painting a picture of ‘a country that truly works for everyone’ in which ‘successful businesses can emerge and grow… [and] invest in the future of our nation’.

Later on in the white paper it states that ‘the real test of a successful strategy is the consequences it has for the lives of our fellow citizens. That must mean more good jobs and better pay.’

Specific ideas and commitments about the way in which business conducts itself, or contributes directly to the generating of better paid jobs and better lives for us all are rather thin on the ground.

The competitive and regulatory environment, which you might think was a crucial element in any industrial strategy, merits only six paragraphs in 250 pages, one of which concerns the challenges of regulating driverless cars.

A similar amount of space is devoted to a summary of Matthew Taylor’s review of modern employment, which was featured in a recent edition of ICSA’s Governance and Compliance. But that seems to be about it.

The white paper emphasises the need for the UK to remain an open and liberal market economy with a flexible labour market. That does not really clarify things either.

Many will welcome those statements; others will argue that too much openness and too much flexibility have contributed to the perceived divide between business and society.                  

So if, like me, you are looking for clues as to which path the government will ultimately choose to follow, I think you are unlikely to find them here. The search continues.

I will leave it to others more expert than me to opine on the likelihood of the strategy overall being successful.

For what it is worth, the emphasis that is placed on better investment in skills, R&D and infrastructure as a means of boosting productivity and generating jobs must be right.

But the same themes featured heavily in the industrial strategies of previous governments which, as the white paper acknowledges, met with varying degrees of success. And they rely on a level of funding that may not turn out to be available. 

Having said all that, in an era when political thinking has too often seemed to be driven by short-term tactics, the mere existence of a long-term strategy is perhaps something to be grateful for. I wish it all the best.

Chris Hodge FCIS is policy advisor at ICSA: The Governance Institute

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