Specialist Manufacturing Sector: Regional Economies

Debate between Chris McDonald and Rebecca Smith

Wednesday 19th November 2025 Westminster Hall

[Chris McDonald]

That point is well made. Of course, alongside our industrial strategy, we have our defence industrial strategy. When I come to talk about procurement, I may say more about that, and many hon. Members have talked about defence.

When we talk about our manufacturing sector, it is important to highlight some of the headline statistics. Manufacturing pays higher wages and has generally higher productivity in the areas where it is located and, when it comes to the balance of trade, although around 10% of our employment is in manufacturing, it accounts for around 50% of our exports. Those outputs, jobs and exports consist of thousands of specialist manufacturers, large and small, up and down the whole United Kingdom. Those exports are global and, as we have heard, we also export into space.

On procurement—I know that this area has been a major concern for many hon. Members, and particularly Government procurement—I have great sympathy for the comments of my hon. Friend the Member for Stoke-on-Trent Central (Gareth Snell), and I am happy to pursue the specific issues that he raised. I see it as vital to our manufacturing and industrial sectors that we ensure that the money that we as a Government, or our regulated sectors, spend is significant and is concentrated as effectively as possible in the UK, for both its economic and its social value. We need to raise awareness of the opportunities. We must ensure that those opportunities are open to UK manufacturers and that our UK companies are competitive enough to win those contracts. The industrial strategy plays a part in ensuring that those companies can do that.

To increase business investment, we must also ensure that we have a real market opportunity, both at home and overseas. Our clean energy strategy is introducing measures aimed at directly increasing UK beneficiaries in Government procurement. The clean industry bonus for offshore wind, for instance, is designed to encourage investment in Britain’s coastal industrial areas and supply chains. We also want to see robust local content targets. We are examining market demand guarantees to encourage UK scale-ups and introducing a clean energy supply chain fund to support UK-based clean energy manufacturing.

The defence industrial strategy, which I mentioned earlier—the defence industry is, of course, another user of valves—sets out a major reform agenda for procurement to grow our UK industrial base. We will be speeding up procurement processes and reducing bureaucracy, while ensuring greater visibility of defence procurement and taking steps to ensure that small and medium-sized enterprises will have greater access to our supply chains. Our procurement and capital programmes are key to anchoring manufacturing here in the UK and then encouraging businesses to secure investment and export overseas.

UK manufacturing, however, ranks just 24th globally for robotics and automation. Here I move to the topic of productivity, which is of course a key element in profitability and competitiveness. That is an area where, as a nation, we need to work more. If we are not working digitally, we cannot adopt automation and move as fast as our competitors. Our Made Smarter adoption programme, with up to £99 million of additional funding, will help with this. It will support more manufacturing SMEs to take up new technologies and improve their digital capabilities. We have had reference today to the High Value Manufacturing Catapult, which I know from personal experience is a great supporter of improving competitiveness, robotics, automation and productivity in our supply chains.

Skills was also an important feature of today’s debate. They were raised by my hon. Friend the Member for Calder Valley, with his inspiring story of Stuart Billingham —maybe we all need to see more Stuart Billinghams in our lives. The hon. Member for East Londonderry (Mr Campbell) also mentioned regional skills development. I know that persistent skills shortages and the availability of good applicants are a concern felt across our manufacturing sectors. That is certainly an area for Government and industry to work closely together on, to encourage talented people from across the UK to seek jobs in our manufacturing sector. Fort Vale in Calderdale has a strong tradition in apprenticeships, and I understand that it receives over 140 applications each year for the opportunities it provides. That experience of high numbers of applications for apprenticeships is something I see across the country. I applaud the work of the West Yorkshire Manufacturing Services charity and its partnership with Calderdale college on the Industry 4.0 hub, which addresses exactly those digital issues.

[Rebecca Smith]

I mentioned skills as a significant challenge in the defence sector and the additional manufacturing. We have five defence technical excellence colleges opening by the end of next year. How well connected is the Minister’s Department with the Department for Education? Does he have any knowledge of when those colleges will be announced? They are surely a key part of what the Government hope to achieve with defence skills, but they will also be important for regions such as the south-west.

[Chris McDonald]

I welcome those comments. The hon. Member is right to point out that skills is a cross-Government exercise, and that applies not only to defence skills colleges. Work is done across the two Departments I work in—the Department for Business and Trade and the Department for Energy Security and Net Zero—and skills itself resides in the Department for Work and Pensions, which is where it is co-ordinated. Moving skills into that area and having the co-ordination there is exactly right. I also meet Defence Ministers to discuss this issue; many of these skills are transferable across industries, and we want to ensure that people can transfer across from different industries. A couple of weeks ago I launched the clean energy jobs plan, which provides support for people to move out of the oil and gas sector, for instance, and into clean energy industries. I thank the hon. Member for raising that issue.

Our focus on skills includes a new engineering skills package, worth over £182 million, to fund technical excellence colleges in advanced manufacturing. More widely, through the post-16 education and skills strategy, we are introducing wider reforms, including new foundation apprenticeships for young people in target sectors. Our new V-levels will encourage young learners into vocational pathways, and I am sure that hon. Members will have heard the personal priority the Prime Minister placed on this during his speech at the Labour party conference.

Attracting young people into manufacturing is clearly a priority for the sector, and our advanced manufacturing sector plan sets out ways in which we can do that. Wages in the sector are 8% higher than the UK average, which can provide great opportunities for young people. We heard earlier that welders earn even more than that—something that my nephew, who is a welder, also tells me. My welding is terrible, so I was absolutely unable to pursue that as a career. We are also concerned about equalities, and we have a target of 35% representation of women in the sector by 2035.

Young people also value their employment rights, and I should say to the hon. Member for South West Devon (Rebecca Smith) that before I came to this place I ran a small business that had almost all of those employment rights. I understand that small business owners might be concerned, but I can assure them that it is perfectly—[Interruption.]