Underwhelming overall

For the industrial sector, the positives include an extra £20.4bn for the state-controlled national wealth fund and the British Business Bank, investment in apprenticeships, and reaffirming the target of defence spending reaching 3% of GDP by 2030. There was also good news about a multi-decade cooperation agreement with Rolls-Royce, starting with a joint 10-year, £2.5 billion programme to develop next-generation gas turbine technology for civil and defence aerospace.

Broadly, the comments from various industry bodies and associations seem to be quite diplomatic, highlighting the positives while pointing to further work that needs to be done. Over at the IMechE, James Partington, director of policy and impact, welcomed measures to support business investment and industrial competitiveness. However, he went on to warn that: "The Government must now match this contribution with the ambition and investment needed to unlock engineering’s full potential.”

Similar sentiments were voiced by Graham Hoare, CEO of the Manufacturing Technology Centre, who said: “The Budget’s focus on backing enterprising British businesses, improving access to investment, greater devolution, strengthening our defence and industrial capability, and creating the conditions for innovative firms to start, scale and succeed here is welcome. 

“We now need to turn that ambition into delivery, helping businesses commercialise and adopt new technologies, secure the investment and skills they need to grow, and build industrial capability in the UK. Government, industry and academia working together can ensure British innovation translates into British growth.”

Make UK Chief Executive Stephen Phipson CBE was more critical, saying: “We said this Budget was the first real test of the Government’s pledge to reindustrialise Britain. Today they failed to address the one issue that would enable this – high industrial energy costs.

“Our industrial electricity costs are the highest in the world. As I told the Chancellor last week, this is having a ruinous effect on investment and requires urgent action. It is hugely disappointing that he didn’t listen to a sector that supports 2.6m jobs and accounts for 42% of UK exports.

“Likewise, while we welcome the slowing down of increases in the minimum wage, in general employing people remains more expensive and riskier thanks to the Employment Rights Act and higher employer NICs.

“This Budget has failed to address any of the fundamental costs holding back investment and growth in manufacturing."

While Phipson's comments highlight the shortcomings of the budget, particularly with regard to energy costs, I do hope that some of the wider measures will have a positive impact on the industrial sector in what are unquestionably tricky times.

Charlotte Stonestreet

Editor