Why so secretive? Sunak blasted for ‘surreptitious’ industrial strategy
A set of cross-party former business secretaries have launched a stinging attack on Rishi Sunak over his apparent lack of a cohesive industrial strategy.
Ex-ministers Greg Clark, Peter Mandelson and Vince Cable told the Financial Times the Prime Minister was being so “surreptitious” that his strategy for industry was a “guilty secret”.
Clark, Conservative business secretary from 2016 to 2019, said: “One of the points of an industrial strategy is you should know what it is. An undercover strategy is self-defeating.”
He urged the PM to be “active and activist” on an industrial strategy and to find out why gigafactories are going elsewhere.
Labour’s Lord Mandelson, who helped re-energise modern industrial strategy in the final years of New Labour, said the lack of clear strategy was leaving the UK lagging behind.
While Chancellor Jeremy hunt has “interventionist” instincts, Sunak’s absence of enthusiasm has left the government “mired in confusion”, he said.
Mandelson recalled Sunak as Chancellor saying “he did not see it as his job to have businesses forming an orderly queue at his office asking for handouts”.
“The resulting stasis is leaving us trailing behind our industrial competitors,” he added.
The former ministers were not alone in their criticism for the government’s industrial strategy, with other industry experts also noting the UK’s troubling silence.
Former Bank of England economist Andy Haldane, who also served as industrial strategy council chairman prior to it being scrapped, told the FT: “The world is going bananas on industrial strategy. There’s an arms race going on about this right now [and] we can’t even bring ourselves to mouth the words.”
MakeUK boss Stephen Phipson said the UK was the only top economy not to have one.
The accusations will sting for the Prime Minister who landed in Tokyo yesterday ahead of a G7 summit and announced £18bn of direct Japanese investment in British businesses.
Hunt insisted at a British Chambers of Commerce (BCC) conference yesterday: “We do have an industrial strategy. We’ve identified five growth sectors that we think we will need to give special attention to.”
Under Sunak, the government is focused on what he sees as five key sectors: digital technology, creative industries, advanced manufacturing, green industries and life sciences.
He scrapped the Department for Business, Energy and Industrial Strategy earlier this year and, as Chancellor, in 2021 ditched Clark’s industrial strategy in favour of ‘Build Back Better’.
Ministers insist there is a package of policy to support future growth, but Labour and industry leaders have warned the UK is lagging behind on electric vehicles and battery production.
Labour leader Sir Keir Starmer hinted yesterday, also at the BCC conference, that he would step up government investment and launch policies to boost private investment.
It comes after the party promised a £28bn a year green tech plan as part of an industrial strategy if elected, to offer “workers and industry the certainty and backing they need”.
Asked by City PM about his approach, Sir Keir told firms he was focused on “certainty, stability, having a plan for growth, using the partnership we can put together with business”.
State subsidies have made global headlines following US president Joe Biden’s vast £369bn investment package via the Inflation Reduction Act (IRA) and the EU’s response.
Hunt has pledged to respond to the green plan either at or prior to his Autumn Statement, but current indications are that it will not match the scale of the US’s package.