The Government’s Productivity Plan

Amanda Solloway Excerpts

Tuesday 28th February 2017 Commons Chamber

[Amanda Solloway (Derby North) (Con)]

It is a great honour to follow the hon. Member for Kirkcaldy and Cowdenbeath (Roger Mullin); I always listen to him with great enthusiasm. It is also great to be here with fellow members of the Business, Energy and Industrial Strategy Committee. To add to the comments of my hon. Friend the Member for Bedford (Richard Fuller), it is a great privilege to serve under the chairmanship of the hon. Member for Hartlepool (Mr Wright).

Productivity is an essential driving force for the country’s economy, with direct implications on our long-term growth, living standards and wages. Its importance was highlighted by my right hon. Friend the Chancellor of the Exchequer in his autumn statement back in November, when he spoke about how the UK is trailing behind several countries in terms of productivity, including the US and Germany. In seeking to tackle that problem, he announced £23 billion of investments, designed to improve output, with particular emphasis on infrastructure and housing. Along with the productivity plan and industrial strategy, that illustrates the Government’s commitment and determination to making the UK the best place in the world—

[George Kerevan (East Lothian) (SNP)]

I hope the hon. Lady will forgive me for interrupting her in her stride—she is making an interesting argument—but the largest proportion of the Chancellor’s £23 billion productivity innovation plan is for house construction. How does that add to productivity?

[Amanda Solloway]

I will come to that later in my speech. I apologise, but I am having difficulty seeing today, so Members should shout loudly if they want to intervene.

I was saying that the Government’s commitment to making the UK the best place in the world to do business should be warmly welcomed by the House.

I have spent most of my life in retail and manufacturing, so I am acutely aware of the challenges faced by the sector, which are clearly not unique to the industry and can be seen throughout the business community. With the right foundations, business and industry can and will flourish; we just need to provide the right conditions, which the productivity plan rightly addresses. In doing so, it is essential for us to focus on improving the quality of our primary and secondary education to provide an adequate starting point for young people heading into further education, apprenticeships and employment. I welcome the Government’s recognition that improvements to basic skills such as numeracy and literacy play a vital role, and the fact that they are putting those skills at the heart of their reforms. It is skill provision in general that I shall touch on today.

The UK’s competitiveness in the open market is now more important than ever. Following the result of last year’s referendum, as we seek to find new avenues for investment and trade, the potential opportunities for and contribution to our nation’s productivity should not be underestimated. New capital, more competition, and new technologies will all be vital as we look to compete with the rest of the world.

From a Derby North perspective, the success of the midlands engine is incredibly important to me. The midlands engine strategy can be a vehicle to deliver policy that will not only increase productivity but support the vision for a successful United Kingdom. We have a strong offering in the midlands that can deliver growth that is not only balanced by sector, geography and trade, but sustainable, in that it creates skilled, highly productive roles backed by private sector investment. The midlands engine must focus on elements that give us competitive advantage, central to which is our expertise in key sectors, especially advanced manufacturing.

In my constituency alone we have a high density of original equipment manufacturers—such as Toyota, Rolls-Royce and Bombardier—and a well-established supply chain that serves them all. It is essential that we have the training and skills that match local employers’ needs, which is something the productivity plan looks to address.

[Andrew Stephenson (Pendle) (Con)]

Today I met Katie Goodwill, who won the gold medal in computer numerical control turning at the 2016 WorldSkills show in November, and Ryan Worthington, another award winner; both work for Rolls-Royce in Barnoldswick in my constituency. Does my hon. Friend agree that apprenticeships play a vital part in developing the skills we need to improve productivity, and join me in congratulating Katie and Ryan on their success?

[Amanda Solloway]

Of course I do, and I congratulate them both on their great success. I was about to mention the apprenticeship levy, which is essential because it encourages large businesses to invest in their workforce and in the future, and will ensure that the UK has the skilled workforce it needs in the years to come.

During my time as an MP, I have regularly heard that more needs to be done to tailor skills to play to local strengths and boost productivity. Brilliant work is being done in Derby to try to tackle that problem. For example, in response to the needs of businesses such as Rolls-Royce and Bombardier, the university in the city recently opened a new science, technology, engineering and maths building. Apprenticeship providers such as 3aaa are building initiatives to link employers, schools and apprenticeship providers to tailor skills. A great example is the recently opened construction academy in Derby North, which looks to encourage and train young people in the much-needed skill of bricklaying. More needs to be done to support such hard work, and giving the required resources to the productivity plan will do just that. Initiatives such as those I have mentioned can make a real difference locally, and will not only set the foundations for growth but keep the east midlands and the UK on the map as a place where a technically skilled workforce is in place to meet demand.

It is reported that there is an annual engineering skills gap of 82,000 staff, which is clearly cause for concern. However, it is widely recognised in Derby that the local worker supply chain is struggling to keep up with the demand for skills that employers need. There are, though, positive signs that with smart investment and the long-term vision that comes from the productivity plan, those problems can be overcome. The Government have shown that they are committed to tackling our productivity problem, whether it is through new funding and capital, or through education, infrastructure and research and development. It is imperative that we support the plans outlined as we look to implement a long-term vision for our economy. I certainly feel that for Derby and the east midlands there are some great proposals in the plan that will go a long way towards addressing our specific concerns, while also addressing the issue of productivity and output throughout the UK.