Government must 'bolster manufacturing'

Firstly, that HM government will bring forward measures to bolster UK manufacturing. Specifically:

- a review of all energy and environmental measures and their cumulative direct and indirect effects on the Energy Intensive Sectors
- early implementation of measures to speed up the planning process
- investment in infrastructure
- a review of Capital Allowances to encourage inward investment
- direction of funds from the Green Investment Bank into research and trialling of new carbon reduction technologies in the Energy Intensive Sectors
- more support for exporters
- meaningful measures to reduce “red tape” and the number of quangos
- more support for training (e.g. restoration of ProSkills funding)
- a pro-UK bias in all government purchasing decisions.

So far government action to boost manufacturing has been piecemeal, selective and insufficient. If manufacturing is to play a major part in re-balancing the UK economy, all government departments need to focus efforts on achieving that objective. We could do a lot worse than to follow the German example where a pro-manufacturing culture exists throughout government.

Secondly, that HM government will bring forward measures to implement an energy policy based on the principles of ensuring continuity of supply at lowest cost. Specifically:

- support for the exploitation of shale gas reserves
- implement sustainability criteria for energy only biomass
- restore incentives for good quality Combined Heat and Power (CHP)
- invest in further research to develop “clean coal” technologies
- a plan to replace existing nuclear power generation
- enhancement of measures to reduce energy consumption in the domestic sector.

Energy and climate change policies have become inextricably linked which has added both directly and indirectly to energy costs both for industry (especially the Energy Intensive Sectors) and the household consumer and these costs are set to rise even further and faster from 2013 onwards. We cannot expect our industries to remain internationally competitive if we continue to pursue policies that will add to our manufacturing cost base, whilst other nations are free to exploit cheaper alternatives.

As far as the domestic consumer is concerned, energy costs are now a major element in household budgets. The more money spent on energy the less there is to spend on other items which, in turn, will adversely affect overall consumer spending which will further make it less likely that the UK will emerge strongly from the current economic crisis.