Industrial Strategy

Alex Cunningham Excerpts

Wednesday 18th April 2018 Commons Chamber

[The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)]

I beg to move,

That this House has considered the Industrial Strategy.

It is a great pleasure to open this debate. We are at one of the most important, exciting and challenging times in the history of global enterprise. All around the world, new technologies are transforming the way in which we live our lives as citizens, how we work and the products and services that we consume and supply. Whether it is in artificial intelligence, the digitisation of manufacturing, the clean energy revolution or breakthroughs in medicine, such is the scale of change that it has been described as the fourth industrial revolution. Britain is extraordinarily well placed to lead and benefit from this industrial revolution, just as we did in the first industrial revolution.

We are an open and enterprising economy, built on invention, innovation and competition. We are one of the world’s scientific powerhouses, producing more Nobel prize winners each year than any other country apart from America. We are synonymous with creativity, from literature to video games. People know that the UK is a hotbed of new ideas. In an uncertain world, we have a deserved reputation for being a dependable and confident place in which to do business, with high standards, respected institutions and the reliable rule of law. As this week’s Commonwealth Heads of Government meeting shows, we are—and always will be—proudly international. We are a crossing point for the world because of our geographic position, the importance of the English language, our global friendships and our vibrant culture.

Ten years on from the financial crisis, we have built a stronger economy than many people thought possible at the time. Unemployment is at its lowest rate for 43 years and there are more people in work than ever before. Our public finances have been transformed by rigorously reducing the yawning deficit that was inherited. We have world-beating industries—from financial services to the life sciences, and from the creative industries to advanced manufacturing.

As we look to the future, it is one in which Britain’s strengths are in increasing demand all around the world. The world is avid for our products, services, skills and know-how. To benefit from the opportunities before us, we need to prepare to seize them. We need to ensure that we join all the forces of our people and our economy to reinforce them and extend our strengths into the future, as well as capitalising on the new opportunities that have presented themselves. That is why I stood before this House at the end of November to launch our industrial strategy White Paper.

Deliberately, the exercise of producing the White Paper was a collaborative one. It was the biggest such consultation ever undertaken by my Department and its predecessors, drawing input from more than 2,000 organisations the length and breadth of the United Kingdom. I was particularly pleased that all the devolved Administrations contributed enthusiastically to the consultation. Employers, universities, research institutions, local government leaders and trade unions all contributed to the consultation that resulted in the White Paper, and there was a deliberate reason for this. It seems to me that if the nation is to have an industrial strategy, it has to be for the long term; we must orient our economy and society to the long term. The best way to ensure that policies and institutions endure is to take people with us, and to ensure that the advice and wisdom of all parts of the United Kingdom and all parts of the economy are taken and distilled into something of which all can feel a part.

[Alex Cunningham (Stockton North) (Lab)]

As the Secretary of State knows, Teesside is a powerhouse for industry, but in my constituency unemployment is still double the national average, and across the north-east of England it is considerably higher than the national average. Does he not agree that still more needs to be done to ensure that we balance industrial strategy in favour of those areas where there is high unemployment, and a lack of skills as well?

[Greg Clark]

The hon. Gentleman knows Teesside very well. One of the things he would welcome is that in recent years the long-standing disparity, going back decades, between constituencies like his and others in the country has narrowed. There is a real sense of progress and achievement on Teesside that I experience every time I go up there; I was up there a couple of weeks ago. However, he is absolutely right that we need to continue that progress. We need to reflect on the fact that, as I said, many of the industries, skills and attributes that are in demand across the world now—marine engineering, for example—are abundant in areas like Teesside. We must capitalise on that, and we have a massive opportunity to do so. The industrial strategy, as he knows—our friends and colleagues on Teesside contributed very fully to it—has, for the first time in an industrial strategy, a real, very clear attachment to the importance of recognising the contributions of different places. This came out very strongly through the consultation, so he is absolutely right.

--- Later in debate ---

[Greg Clark]

My hon. Friend is absolutely right. It is sometimes not known and cannot be seen what modern manufacturing is about. I had the great privilege and pleasure of visiting the Big Bang Fair at the National Exhibition Centre in Birmingham a few weeks ago, which does precisely what he advises. The excitement among the young people there, seeing the possibilities available, was palpable. It does a great job.

I know that you are rightly interested in other Members being able to contribute, Madam Deputy Speaker, so I will make some progress and give colleagues the chance to speak. Along with the measures in the Taylor review, it is very important, when new technologies require different skills from the existing workforce, that we back industry in providing the training that is needed. In that regard, the national retraining scheme being developed in conjunction with employers and trade unions, focusing initially on construction and digital skills, is a very important commitment. It is also vital that we upgrade our infrastructure, whether physical infrastructure or the broadband and mobile connections on which many new businesses depend, and again important commitments have been made in that regard.

When it comes to places, the leadership being given to many of our great cities by elected Mayors, not least those elected last year, must be combined with the ability, powers and resources necessary for them to make a difference to their areas. One of our commitments was a fund to enable local leaders better to connect not just city centres but the networks and clusters of smaller towns around our cities. An early example was the decision by Andy Street, Mayor of the West Midlands, to use the investment available through the industrial strategy to fund a metro extension to Brierley Hill and Wednesbury, which connects two important parts of the west midlands to Birmingham and the wider area.

On the business environment, we know that there is a problem of composition. We have some highly productive, highly performing businesses as well as what the Bank of England has identified as a long tail of less productive businesses, and transmitting the lessons from the best to the others is an important part of the work that we need to do.

I will conclude by saying a word about the importance of particular sectors. We have talked about the north-east and Teesside, the west midlands and other parts of the country. We know that the clusters of excellence in those areas can be very important not only in driving productivity but in attracting new investment and becoming the location of new businesses.

[Alex Cunningham]

One of those clusters is, of course, the chemical industry. People in that industry are extremely anxious about the possibility that the EU regulation concerning the registration, evaluation, authorisation and restriction of chemicals might go when we leave the EU. Will the Secretary of State update the House on where we are with negotiations on those regulations to ensure a common working platform for chemicals after we leave the EU?

[Greg Clark]

I would incur your displeasure, Madam Deputy Speaker, if I went into the European negotiations. Suffice it to say that if the hon. Gentleman reads the Prime Minister’s Mansion House speech, he will see a reference to chemicals. We take the advice of the Chemical Industries Association, which I meet regularly, into those negotiations so that we can continue to trade successfully in that very important sector.

I want to say a word about sector deals. As the right hon. Member for Wolverhampton South East mentioned, we know of the success of long-standing arrangements whereby major manufacturers, supply chains and the Government can work together—for example, in the automotive sector and the aerospace sector. These important institutions have taken a lead and boosted jobs and prosperity. In the industrial strategy consultation, therefore, we asked whether we should offer and engage in more sector deals with sectors that have not benefited from those arrangements. We asked business whether that proposal had merit, and the answer was an emphatic yes. These deals are about the Government working with sectors, but also about the sectors working with each other, in exactly the way that the right hon. Gentleman mentioned.

We have made significant progress. In December, I launched the life sciences sector deal with my right hon. Friend the Secretary of State for Health and Social Care. This deal for the long term is already attracting immediate investment, including from MSD, which is supporting nearly 1,000 jobs in the UK.

--- Later in debate ---

[Alex Cunningham (Stockton North) (Lab)]

I want to concentrate on one particular aspect of the Government’s industrial strategy, which is what seems to be their limited work to deliver carbon capture and storage projects, with the thousands of new jobs CCS could create and the hundreds of thousands it could protect.

Yesterday, I took part in a roundtable event hosted by the Institute for Public Policy Research on northern energy industry, where I spoke about the northern energy taskforce and its recommendations on expanding low-carbon energy. The recommendations are ambitious, realistic, comprehensive and achievable, but they are also essential. The north has a huge advantage when it comes to expanding low-carbon generation: hydrogen production, in which Teesside is the biggest producer in the country; the development of energy storage; the opportunity to develop smart grids to support our industry and communities better; and, of course, carbon capture and storage.

I chair the all-party group on carbon capture and storage, and I know that both parliamentarians and people from industry have been very disappointed and frustrated at the lack of comprehensive action on this issue. Two years ago, the Government cancelled the CCS competition to establish one or two projects at the Humber and in Scotland. Since then, we have been trying to play catch-up, and while there have been encouraging words from the Government about possible investment, every moment of delay is a continued failure. Delays are also giving countries the opportunity to steam ahead of us so far that we will never reap the benefits that CCS can bring to the UK.

Carbon capture is vital not only to create and support industry and to increase productivity and profitability, but in delivering the clean growth grand challenge, in that it would deliver a long-term sustainable future for key industries such as chemicals, steel, cement and oil refining, and it would enable low-carbon fossil fuels to continue to provide a clean, flexible source of electricity.

I was a little encouraged when the Government published their clean growth strategy in October last year, which includes the intention to develop a new approach to carbon capture and storage, but I am concerned about its ambition of deploying CCS at scale during the 2030s, subject to cost reduction. I am afraid we need much more than ambition when it comes to this issue; we need robust plans that deliver our capability and need. I am afraid that the 2030s will be far too late—long after other countries have steamed ahead of us and taken the opportunity.

I am proud to represent a Teesside constituency, and it is deeply frustrating for me to see the potential that we have to be a key CCS site while the Government talk a good talk but appear slow to real action. The Teesside Collective is based in my area, and one of its main projects is decarbonisation. The collective is industry-led. Those industries know what they are talking about, and they know what they can achieve given the right environment. Teesside’s concentration of industrial emitters and proximity to potential storage sites under the North sea means that the area is industrially and geographically suited to be the starting place for large-scale industrial decarbonisation in the United Kingdom. We also have the potential for a large-scale CCS-ready power station, which would add huge value to any project in the area.

While I trust that I will always be Teesside-focused, it is important for us also to focus on developing CCS in other countries and regions, such as Scotland, Yorkshire and Humber, the north-west and Wales. A number of potential projects are already being considered, and the Government need to create a framework in which they can be successfully delivered.

CCS is also an essential part of the lowest-cost route to achieving the UK’s climate change targets. The Committee on Climate Change has said that the Government should not even be considering any scenario to meet the 2050 target that does not include CCS. If we are not to be left behind, we need the first CCS projects to begin operating in the 2020s. While the £100 million to support that work is welcome, the Government will need to do much more to ensure its success. The development of low-carbon industrial clusters would constitute a major upgrade to UK infrastructure for a decarbonised economy, supporting regional growth at a time when the outlook appears shaky at best.

Sadly, by the time we see the report from the Cost Challenge Taskforce we shall be three years behind where we should have been. The time is now. I believe that the Minister for Energy and Clean Growth who visited Teesside recently, does “get” CCS, but we need her to bang on the doors of the Treasury and come up with the money that is needed to push these matters further forward.

It is vital for the deployment pathway to set out a strong and clear approach to CCS that will enable the first projects to begin operating in the 2020s—and that is 10 years earlier than the Government appear to be planning. Our industries need to know that the Government are on their side and are prepared to work in partnership and share the financial risk as CCS is developed.

--- Later in debate ---

[Richard Harrington]

I hope the hon. Gentleman will excuse me, but I do not have time to give way.

My hon. Friend the Member for Cleethorpes (Martin Vickers) mentioned a town deal for Grimsby and Cleethorpes, and I heard him speak very eloquently about it. There has been a meeting, and it is an absolute priority for us.

My hon. Friend the Member for Fylde (Mark Menzies) mentioned an aerospace growth partnership. This shows, as he knows, the benefits of a strategy that involves business and the Government working together. That is an intelligent way to channel money from business and from the Government together, which really summarises what the whole industrial strategy is about.

[Alex Cunningham]

Will the Minister give way?

[Richard Harrington]

I am very sorry, but there is not time to give way.

Following an Adjournment debate held by my hon. Friend the Member for Stoke-on-Trent South (Jack Brereton), I have met representatives of the ceramics industry and we are making progress—thanks to his efforts and those of other Members of Parliament, as well as the efforts of Laura Cohen and Kevin Oakes. We understand the ceramics business and we hope to be able to progress matters with them.

I thought at first that my hon. Friend the Member for Boston and Skegness (Matt Warman) was living in the 1840s, but the only person I know who does that is the Leader of the Opposition and he is not in the Chamber this afternoon. My hon. Friend showed us very eloquently that the lessons of the 1840s and the Government’s responsibility to harness developing technology go absolutely to the centre of the industrial strategy.

My hon. Friend the Member for Chippenham (Michelle Donelan) talked about the skills gap in Wiltshire—another important aspect of the industrial strategy—and mentioned a retraining scheme, which is about people and places. My hon. Friend the Member for Chelmsford (Vicky Ford) mentioned many sectors in Chelmsford. She showed that she had really read the industrial strategy and seen what it means in her constituency, and she is continuing to support it.

My hon. Friend the Member for Redditch (Rachel Maclean) said that Birmingham is better than Manchester. I cannot comment on that, although I would say that neither of them is as good as Watford, but you would expect me to say that, Mr Speaker. Seriously, she continues to argue for a town deal for Redditch, and I am very happy to meet her to discuss the idea of a free port.

My hon. Friend the Member for Stirling (Stephen Kerr) is absolutely right to say that the University of Stirling is a jewel. Our universities are jewels, but the industrial strategy is helping them to work together with business and the commercial world, as I saw only two weeks ago when I helped to launch a new science hub at the University of Hertfordshire.

[Alex Cunningham]

Will the Minister give way?

[Richard Harrington]

As hon. Members will know, I usually do my absolute best to take interventions, but I cannot do so on this occasion.

The attitudes we have demonstrated are based on fact, not fantasy. This industrial strategy is absolutely real, as well as imaginative, rounded and ambitious. We have had such attitudes for centuries—this goes back to the point about 1841—but this is the way in which the relationship between the Government and business will evolve. Those attitudes are a source of strength, just as our world-leading universities, businesses and workers are a source of strength. I believe that such attitudes are unique to the United Kingdom and, in combination, they are an asset that no other country can match in the same way.

The industrial strategy builds on our existing strengths and addresses any weaknesses. There is a wealth of potential in this country, and it is our duty to see it realised. It is my contention, and that of the Government, that our industrial strategy, which is available in as many languages as people want, will help this potential to be realised and will build an economy that is—I think this is the expression, which you may have heard before, Mr Speaker—fit for the future. I am very proud of it, and it is my job, and that of my right hon. Friend the Secretary of State, to see it delivered in the weeks, months and years to come.

Question put and agreed to.

Resolved,

That this House has considered the Industrial Strategy.