UK Modern Industrial Strategy

Nusrat Ghani Excerpts

Monday 23rd June 2025 Commons Chamber

[Several hon. Members rose—]

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Please be seated. The Secretary of State is very diligent, but could he let his officials know that if the opening statement is to go beyond 10 minutes, they should inform the Speaker’s Office? As the statement went a little bit longer, I will allow the Opposition and the Liberal Democrats to have an extra one minute each. I call the shadow Secretary of State.

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[Jonathan Reynolds]

So fuelled by optimism am I today that even the shadow Secretary of State cannot bring me down. Having been in opposition for some time, I can say that, “This document is all rubbish and I welcome most of it,” is quite an exciting take on a response. The Conservative party has managed to oppose almost everything that the Government have done in their first year, including, in my Department, the Product Regulation and Metrology Bill, which the previous Government were planning to introduce had they remained in office, and the India trade deal, which they were negotiating but could not get across the line, so I welcome the small bits of positivity in his response.

Everyone across the House should support the strategy. It is based on things that will not be secrets to hon. Members who spend time with businesses on constituency Fridays and at weekends. They will be told about skills, energy, access to finance and how local areas should have the powers to address the needs in their local economies. I hope that the shadow Secretary of State would recognise, in good spirit, that many of the problems that need to be addressed grew under the Conservative Government. For example, the fact that energy bills became so uncompetitive was a result of actions and decisions of the Conservative Government. We are fixing that problem, in order to make a difference.

On skills, one in eight young people are not in education, employment or training, while net immigration is at 1 million. That is not a policy success. It needed to be addressed. We needed to address, too, the failures on the funding of courses such as engineering. That was such an obvious need for our sectors. Finance is one of the longest-running problems; we are all familiar with it.

The shadow Secretary of State asked a number of questions, and I am more than happy to answer them. On small businesses, if he reads more of the detail when he has a bit more time, he will see that small and medium-sized enterprises play a vital role in the creative industries and defence sector plans. To anyone who asks, “What’s the message to businesses that are not in sectors covered by the industrial strategy?” I say that they will benefit from people having good jobs and high incomes. Whether they are in hospitality, retail or leisure, they will see a direct benefit from the strategy. The small business plan will come out in July, and it will deal with issues such as late payment, business support and access to the kinds of tools—rental auctions and so forth—that will make a difference on the high street.

The shadow Secretary of State attacked net zero. That is a mistake. Why would we turn our back on billions of pounds of investment and all the benefits it could bring? In particular, becoming a country that is not so reliant on volatile foreign gas prices is an obvious thing that we would not want to turn our back on. He seemed to announce a new Conservative position of opposing CBAMs, which deal with carbon leakage and create a level playing field. I am surprised by that, because the previous Conservative Government were strong advocates of them.

On the bioethanol industry, talks continue with the two plants most directly affected. Of course, they were in a challenging position before the US trade deal; the deal was not in itself the cause of that. They were losing money. If I intervene, I must have a route to profitability, and that is the basis of those conversations. We are committed to precision breeding. Businesses that moved to France would find a more restrictive environment there because of EU regulation, so I would not recommend that.

On OneWeb, there are some specific issues, about which I would be more than happy to talk to the shadow Secretary of State. On regulation, we have already taken decisive action, for example with a strategic steer to the Competition and Markets Authority, which has been warmly welcomed by businesspeople. They ask me for more of that, and that is exactly what we intend to bring forward.

Finally, let me say, because I know that this is so important to colleagues, that I am more than happy to offer a briefing to any Front-Bench spokesperson or group of colleagues across the House. There is so much in the strategy that will make a difference and so much detail worth sharing, and I would be more than happy to do so with colleagues. Let us all get behind the strategy and get behind British industry.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call the Chair of the Business and Trade Committee.

[Liam Byrne (Birmingham Hodge Hill and Solihull North) (Lab)]

I congratulate my right hon. Friend on the biggest remaking of the relationship between the public and private sectors for a generation. The business community in this country will be stronger and better for the measures that he has announced today. Business will welcome in particular the huge investment in skills, access to research and development, and access to capital, but the game changer is the investment in energy that he has announced. Cutting industrial energy prices is a way to get rid of the albatross around the neck of British business. It is a big promise; can he assure the House that there is both the plan and the pound notes to deliver on it?

[Jonathan Reynolds]

I warmly welcome those words from the Chair of the Select Committee. I absolutely agree with him. There is so much in the strategy, but we were so uncompetitive on energy that whether action could be taken had become a test of credibility from business. The kinds of changes we are talking about—a reduction of £35 to £40 per megawatt-hour by exempting eligible businesses from payments for the renewables obligation, feed-in tariffs and the capacity market—will make a real difference. We are talking about going from being the absolute outlier to, today, being cheaper than Italy and the Czech Republic and on a par with Germany. That is a game changer, and it has been welcomed. We will obviously have to consult; we can make the changes to the supercharger more quickly than we can introduce that support. Of course, we will have to set a threshold intensity test and make sure it goes to the sectors in most need of it, but we expect those to include the core foundational sectors as well as aerospace, automotive and all the areas where the competitive pressure is most acute. I am incredibly excited by that.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call the Liberal Democrat spokesperson.

[Sarah Olney (Richmond Park) (LD)]

The Liberal Democrats have long been champions of the industrial strategy. We are proud that the strategy we introduced in government set out the Green Investment Bank, the British Business Bank and the regional growth fund, and we strongly opposed the Conservative Government’s damaging decision to scrap our country’s industrial plan. We therefore welcome the re-establishment of the industrial strategy and the fact that it focuses on many of the sectors we prioritised in government, including life sciences, professional services and clean energy.

On energy, measures to bring down some of the highest industrial prices in the world will be welcome news for our manufacturers and energy-intensive firms, but we cannot forget that businesses across our entire economy struggle with high energy prices, not least our hospitality businesses and small and medium-sized enterprises. What steps is the Secretary of State taking to ensure that small businesses across sectors have access to better energy deals? Will he look to bring forward the industrial competitiveness scheme from its current two-year horizon?

On skills, while today’s announcement comes with a welcome funding boost, it stops well short of the fundamental reform that we need, so will the Secretary of State accelerate the reform of apprenticeships and empower Skills England to act as a properly independent body with employers at its heart? One key omission from the strategy is our world-leading agrifood industry, which has been relegated from being a priority sector to receiving only a handful of mentions in the entire document. I hope that the Secretary of State will admit that our farmers and rural communities deserve far better. On trade, if the Government are truly serious about backing British business and going for growth, will they show more ambition on trade with Europe and look to negotiate a new UK-EU customs union, which could put rocket boosters under UK plc?

In the extra time that you have kindly granted me, Madam Deputy Speaker, I want to ask the Secretary of State about access to finance and about addressing inequalities in particular. As chairman of the all-party parliamentary group on ethnic minority business owners, I have seen for myself the data on how much more difficult it is for those businesses to access finance, and similar data exists for women entrepreneurs. Addressing those inequalities would add a great deal to growth. Finally, when will we see more details about the National Wealth Fund?

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[Jonathan Reynolds]

There is the true voice of Scotland—it is fantastic to hear that optimism and pride for the future.

My hon. Friend is right that there are huge advantages for her constituents in this strategy, which commits the kind of quantum of funding on a long-term, committed basis on R&D, which cuts industrial energy prices and does things across the board. There is so much that is part of the strategy. If I were to break down each of those sectors, I could be here for hours. You would probably get upset with me, Madam Deputy Speaker, if I read out each of the measures that are part of the strategy.

As I said in answer to the previous question, when we are doing a national industrial strategy, we—entirely rightly—have to respect the devolution settlement, and there are some supply-side areas of industrial strategy that I as the UK Secretary of State do not have control over. It is right to reflect that, to build on that where we can and to work in partnership where we can. There are things I would like of the Scottish Government. If we think of Scotland’s tremendous pedigree in civil nuclear power, all that investment is denied to Scotland because of the policies of the Scottish Government. I have my frustrations, but I will work together where we are able to do so to produce the best outcome for Scotland.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call Select Committee Member Charlie Maynard.

[Charlie Maynard (Witney) (LD)]

The Secretary of State said,

“The UK has long been and will remain a champion of free trade”

—if only! It is not on the big stuff or the important stuff. Leaving the EU’s customs union and single market has reduced UK GDP by between 2% and 4%. The deal with India is good news, but according to the UK Government’s own estimate, it adds 0.1% in the long term—that is, 20 to 40 times smaller. UK exports are down 13% since the trading co-operation agreement took effect. That impacts people in my constituency and all hon. Members’ constituencies. When will the Government move faster to repair the enormous economic damage of a hard Brexit?

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[Jonathan Reynolds]

I welcome my hon. Friend’s question, which speaks directly to the challenges we are facing. As well as the action on energy bills, we will make sure there is a priority service for businesses to get the grid connections they need—one of the biggest barriers to investment—along with investment in skills. Something that I am particularly excited about is that we are going to spend £41 million to make sure that there is decent wi-fi on every mainline train service by using the latest satellite technology. If I was coming to Parliament just to announce that, I would be quite happy, if I am being honest.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Hopefully the rail line that takes me into my constituency will be the first on the list.

[Mike Martin (Tunbridge Wells) (LD)]

There is much to like in the statement. I particularly like the reduction in energy costs of between 20% and 25%, but I would like to push the Secretary of State a little on that; so that industry can plan, when does he think those 25% reductions are going to happen?

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[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call Business and Trade Committee member, Rosie Wrighting.

[Rosie Wrighting (Kettering) (Lab)]

I welcome the Government’s ambition to double business investment by 2035, but on the Business and Trade Committee we have heard time and again from businesses that they face barriers in unlocking the investment they need to scale up. Can the Minister set out how the Government intend to support access to scale-up finance so that our economy benefits from our innovation?

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[Jonathan Reynolds]

I thoroughly agree. It is an exciting day and the challenge is long-term consistency and reliability—which, frankly, this Parliament and previous Governments have not supplied. There is a key voice from business to us that we need to address. Digital and tech skills are one of the prominent features of the skills interventions in the industrial strategy in order to do what the hon. Lady says. It is a significant funding package and a significant partnership with businesses, who are telling us they want to work with Government and with young people and that they want to reskill people. I think there is more we can do, but this is the start. I am keen to work with the hon. Lady and any colleague who sees the urgency of this work and the benefits it could bring.

[Madam Deputy Speaker]

Questions are far too long and the Secretary of State is far too generous with his responses. Let’s try to nip that in the bud.

[Rachael Maskell (York Central) (Lab/Co-op)]

York Central, our biggest brownfield site, will release 12,500 new jobs in advanced and digital rail and the digital creative sector, as well as in the bio-economy mentioned in my right hon. Friend’s brilliant industrial strategy. Will he, however, ensure that innovation hubs at the centre of these cluster developments are able to come on-stream and get the funding they need to unlock these sites?

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[Jonathan Reynolds]

I thoroughly agree with my hon. Friend. It is brilliant to see her in Parliament as she has been a trailblazer on these issues, and I recognise the case that she has put forward extremely well. I recognise that this is a core economic priority for the United Kingdom, and it is great to see her as an advocate for that on the Government Benches.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call Tom Hayes.

[Jim Shannon]

My bronchitis is starting to get to me a little, Madam Deputy Speaker.

[Jonathan Reynolds]

I am more than happy to tell my hon. Friend. We have breakdowns for every region going to every colleague; there is so much for each part of the UK that I could not possibly do it justice from the Dispatch Box. On his point about clean energy, there is so much money coming into the UK—and more in future—that it would be crazy to turn our backs on that. This is a major economic opportunity, as well as being about a safe, reliable, clean supply of energy for the UK, which is the basis of all economic activity. We can provide that while reducing energy bills for industry, so that is exactly the kind of consistent approach that this country has needed for some time.

[Madam Deputy Speaker]

With my apologies for not calling him earlier, I now call Jim Shannon.

[Jim Shannon]

You are very kind, Madam Deputy Speaker—we got there in the end.

I thank the Secretary of State for his statement, which is full of positivity. Everyone here welcomes it deep down, and if they do not, then they should: well done, Minister, and well done this Government. While I welcome the news that more than 7,000 British businesses are set to see their electricity bills slashed by up to 25% by 2027, it is clear that much more support is needed, such as a reduction in corporation tax, especially for businesses in Northern Ireland, which borders the Republic of Ireland where the corporation tax rate is half of our rate at 12.5%. Will the Secretary of State discuss that with his Cabinet colleagues in order to provide greater support for our industries in Northern Ireland?

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[Jonathan Reynolds]

I thank my hon. Friend for her question. She has already heard me outline the eligibility, and the foundational role that ceramics plays in the strategy and the support it can receive. She is also right that we have committed to the energy-intensive industries compensation scheme review that the industry wanted. We should all recognise that the ceramics sector faces more challenges with decarbonisation than some other sectors, and we have to be a supportive partner in that, particularly by recognising some of the technological limitations that currently exist. As I said in answer to a previous question, we have to look at where we are—perhaps we have higher emissions from a sector, but where is that sector internationally? Would it be in our interest to see those emissions exported abroad and emissions as a whole go up? I do not think it would. That is the approach I will always take to the ceramics sector or any other sector to ensure that we are doing the right thing, both for the climate and for British jobs and British industry.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call Jacob Collier. [Interruption.] I call Scott Arthur.

[Dr Scott Arthur (Edinburgh South West) (Lab)]

Thank you, Madam Deputy Speaker. The hon. Member and I must look alike.

I refer Members to my entry in the Register of Members’ Financial Interests. Not that long ago, we had a Scottish Government in which some Cabinet members did not even believe in economic growth, so the contrast with what we have heard today could not be starker. There are 16 mentions of Scotland’s capital city in the industrial strategy, and a key one for Edinburgh South West is Heriot-Watt University’s national robotarium—the birthplace of robotics, as far as I am concerned—but it would be interesting to understand where the Secretary of State thinks universities fit into the industrial strategy, given the pressures that they face in England and the many universities in crisis in Scotland.