PARLIAMENTARY DEBATE
Industrial Strategy - 5 September 2024 (Commons/Commons Chamber)

It is lovely to see you in the Chair, Madam Deputy Speaker, and it is great to see so much interest in the industrial strategy from my hon. Friends. However, I believe Members in all parts of the House can and should support the strategy, and we will seek to make cross-party arrangements. The need is great. We must improve on the UK’s poor business investment performance, which has been the lowest in the G7 for some time. We must recognise that so much chopping and changing of policy in recent years has been to our detriment. That will come to an end under this Government and this industrial strategy.

The Black Country has long been a manufacturing heartland, home to numerous businesses, large and small, that support thousands of good-quality local jobs. Given the Government’s commitment to supporting British manufacturing, will the Minister set out how the upcoming industrial strategy will support manufacturing businesses in the west midlands?

It is wonderful to hear a strong and authentic voice from the Black Country making a charge for industrial strategy; I thank my hon. Friend for her comments. The purpose of the industrial strategy is to capture a much greater share of the big international investment cycles, to explain straightforwardly to investors what those are, to provide consistency and to choose sectors. That does not mean the sectors that are not part of the strategy are not important, but is simply because the strategy must have priorities in it. I think my hon. Friend will support our choices, which will be revealed in the forthcoming weeks. Her area will play a major role in the success of the strategy for the whole of the country.

I thank my hon. Friend for his question. Teesside is a hugely exciting part of the country. There is so much to be proud of there, and so much to be excited about for the future, because of its advantages and the offer that it can make. He asks about green jobs. I have said many times that decarbonisation cannot be deindustrialisation; that is very important. We must recognise that the policy mix that we have inherited is not the right one for delivering decarbonisation, so changes will have to be made. For any business at any level, skills and access to talent in the labour market will always be the foundational issue. We work very closely with our colleagues in the Department for Education. The creation of Skills England and a better link between the skills system and immigration are key parts of that. Moreover, changing the apprenticeship levy to the growth and skills levy, which we co-designed with business, shows that we are addressing this agenda in a comprehensive way for the step change that is required to make our policy a success.

The Secretary of State will be aware of Air Products, which intends to invest £2 billion in northern Lincolnshire and green hydrogen projects. Does he agree that that investment would not only transform the south bank of the Humber, including my constituency of Great Grimsby and Cleethorpes, bringing 1,400 new jobs, but be an ideal project to include in the global investment summit? Perhaps he would be interested in meeting representatives of Air Products and me at some point.

Let me say how wonderful it is to see my hon. Friend back in her place, representing her community and bringing with her even more expertise from the roles that she has held and the work that she has done in her time outside Parliament. It is a key priority for me to ensure that good jobs in the supply chain come with the transition that we all now support. I can tell her not only that we are interested in Air Products, but that my colleague, the Minister of State for Industry, already has a meeting with it scheduled in the next few days, and we look forward to working with my hon. Friend not just on that, but on many issues in the weeks and months to come.

The voluntary sector had a strong voice under the previous Labour Government, and partnership with it was key to our achievements in office. How will my right hon. Friend ensure that the voluntary sector has a strong voice once again under Labour, so that we can deliver the Government’s industrial strategy, particularly as it relates to the creative industries and the mission to ensure high-quality care for all?

It is also great to see my hon. Friend in her place. I enjoyed working with her in her previous role in local government, and she brings all that expertise and achievement with her to this House.

I wish to embed our industrial strategy for the long term. I want to focus it on long-term, sustainable, inclusive and secure growth that will cover many sectors of the economy, as my hon. Friend has mentioned. That will mean the Government having to work in partnership not just with business, but with civil society, trade unions and local and regional leaders in a way, to be frank, that we have not been doing for some years. We will make sure, as she requests, that that is a priority, and is visible in the work that we do.

A Labour Government brought secure, well-paid working-class jobs to Knowsley with Ford Halewood. My dad getting a job there changed my family’s life and lifted us out of poverty. It did the same for thousands of families like ours. Does the Secretary of State agree that any successful industrial strategy must provide good-quality, unionised jobs to lift living standards in areas such as mine?

It is also a pleasure to welcome my hon. Friend to her place, and I thank her for those comments, with which I thoroughly agree. This is what it is all about—good work and good wages in every part of the country. I will work with anyone to deliver that. Her personal story shows the difference that such a policy can make. I often reference, for instance, the difference that Nissan’s investment made to communities in Sunderland. When such investment is made and got right, it delivers long-term benefits for communities and for the UK—more so perhaps than any other policy area. If we want to address, as I do, the UK’s profound regional inequality, policies such as these are so important, so I thoroughly endorse her comments. The industrial strategy is only one part of the growth mission, but it is at the heart of the pro-worker, pro-business agenda not just of my Department, but of the whole Government.

I welcome our Labour Government’s commitment to decarbonisation, particularly for Britain’s automotive industry. It is a vital step in securing the sector’s future and safeguarding high-quality jobs, which are critical for the Vauxhall plant in my constituency of Luton South and South Bedfordshire. Will the Secretary of State update the House on how his Department is working across Government, including with the Treasury and the Department for Energy Security and Net Zero, to drive innovative decarbonisation solutions, to ensure the success of our growth mission?

My hon. Friend is not a new colleague, and her advocacy of the automotive sector, particularly given her constituency interest in Stellantis, is well known and welcome. This was a challenging area, particularly for her constituency, that we inherited. The previous Government had neglected engagement with the business. Since we took office, we have had extensive engagement with Carlos Tavares and the Stellantis team. The journey that the automotive sector has to go on for decarbonisation presents challenges, and there is a challenging picture across all of Europe, but the neglect of the previous Government has ended. Not only am I closely engaged on the issue, as are my ministerial team, but so is the Secretary of State for Transport, particularly in relation to the zero emission vehicle mandate—a key area of policy for the business. We will continue that work, and I will continue to keep my hon. Friend, and any other local MPs, updated, as we have done to date.

I welcome the Secretary of State and his team to what I think is one of the most important Departments in Government. As a sometimes lonely voice on the Conservative Benches advocating for industrial strategy, I signal support for his intention. I am sure that he agrees that the big challenge is to convert our phenomenal science and technology leadership into sovereign industrial supply chain leadership around this country. Having led the strategy for life sciences—quantum, engineering biology, fusion—may I ask whether he agrees that the key to this is cross-departmental Whitehall work, and ensuring that we do not end up with endless earnest, well-intended committees, but actually engage the small businesses, entrepreneurs and investors who are driving these sectors of tomorrow?

I genuinely thank the hon. Member for those comments, because I am serious when I say that I believe that industrial strategy should command support across the political spectrum. That is the norm in a lot of comparable countries to ours. I recognise not just the work that he did, but the number of times he did it; he was called back repeatedly by the last Government to do that work. I am often struck by the comments that Lord Willetts made in the Policy Exchange pamphlet about the lack of a supply chain for offshore wind really benefiting Scandinavian economies, rather than ours.

There are common areas of interest, and to make this industrial strategy more successful than the very credible approach taken by the Conservative Government when Theresa May was Prime Minister, we need it to last longer, and for it to have consistency and permanence. I know that the advocates and designers of that policy wanted the chance to do that. The strategy must also be cross-departmental. It will be led by my Department, but it cannot be solely my Department that is engaged. I can tell the hon. Member that all my Cabinet colleagues share our objectives and a keenness to make this work. We do not just want strategies put on the shelf for the short or long term; we want the strategy to make a difference in the communities that everyone in the Chamber represents. I welcome that cross-party support.

A successful industrial strategy obviously has to include a wise workforce strategy. In the lakes and dales of Westmorland, the workforce is far too small for our needs and is sadly shrinking—66% of hospitality and tourism businesses in the second busiest visitor destination in the country are working below capacity because they do not have enough staff. There are two main issues: a lack of affordable places for people to live, and an inability to bring people in from overseas. Will the Secretary of State support the extension of housing grants to build more social rented homes in Westmorland, and a youth mobility visa deal with the European Union, which would allow us to bring in people to supplement our far-too-small workforce?

The hon. Member makes a really important point. We all have common areas of concern about the United Kingdom economy as a whole—the poor productivity since the financial crisis, the level of growth not delivering the living standards and public services that we want, and the low investment figure—but there are also specific challenges in each part of the country. The relationship between national policy, local policy and local leadership is the way to address those issues.

The hon. Member is an extremely skilled parliamentarian, and he added on a couple of issues that are clearly beyond the remit of the Department for Business and Trade—he did it very well. On the reset of the relationship with the European Union, there are practical, pragmatic measures that I will ask all Members to support, particularly on the recognition of professional qualifications, which I think could have been part of the deal, and what we are planning for food and agricultural products, if we can be successful in that negotiation. Those are our asks. There will be asks from the other side, and we will have to work with our partners to negotiate these things, but I recognise the hon. Member’s key point: yes, there are UK-wide needs, but there are specific needs in each area, and we have to get them right—for his area, for mine, and for everyone’s present.

Further to the question about Air Products asked by the hon. Member for Great Grimsby and Cleethorpes (Melanie Onn), she and I met the company last night; as is often the case, business wants to move faster than the Government. Will the Secretary of State give an assurance that he will do his very best to ensure that his Department meets the deadlines that Air Products hopes for? In a wider context, as the hon. Lady said, northern Lincolnshire is a prime area for the renewables sector, and the Air Products development is key to that.

The hon. Gentleman is right to say that business is often frustrated by the pace at which the Government can go. We are doing a considerable amount of work on how business interfaces with the Government as a whole, how that is managed as a relationship, and how we can assemble the different parts of the state in the way needed to respond to some of our big investment opportunities.

Frankly, in the past, we have often seen the UK miss out, particularly to, for instance, the French. The “Choose France” policy has been fairly successful from their point of view by taking some investments that I believe should have come to the UK. They have got ahead of us. We have to understand that the competitive environment that we are now in is extremely challenging and we have missed out on things. We have to change and get it right and better. I will work with the hon. Gentleman— I have already highlighted the meeting scheduled with my Minister of State—and he makes a fair point that we all recognise has to be addressed.

I welcome the Secretary of State to his place and wish him well in the position he now controls. In Northern Ireland we have many businesses that can excel, but when it comes to an industrial strategy I particularly highlight the defence sector and the cyber-security sector. Just last Friday, my right hon. Friend the Member for Belfast East (Gavin Robinson) and I had a chance to visit Thales in east Belfast. Staff there explained to us that they employ almost 700 people on the site, and they also have an apprenticeships plan that is in action and are taking on another 25 apprenticeships. When it comes to expertise, they have the skills, experience and success, but they do not have the defence contracts, as they have in the rest of the United Kingdom. Will the Secretary of State say some words into the ear of the Secretary of State for Defence to ensure that Northern Ireland can play a bigger part when it comes to accessing those contracts?

I absolutely agree with the strengths that the hon. Gentleman identified; he will know that I visited Northern Ireland as the shadow Secretary of State, partly to make that point. We are responsible for the promotion of the defence trade, so the relationship with the Ministry of Defence and the Secretary of State for Defence is very strong. I will absolutely do as the hon. Gentleman requests.

I call the shadow Minister.

The Government have repeatedly stated that securing economic growth is their fundamental mission, and that is, of course, an entirely laudable aim, but the fact is that more red tape will have the opposite effect. In the light of the right hon. Gentleman’s plans to introduce radical new labour laws, what would he say in response to the Federation of Small Businesses, which has made it clear that firms are increasingly worried about the Government’s proposals, fearing that they will drive up the costs and risks of doing business and thereby reduce their competitiveness and financial stability?

I welcome the hon. Gentleman and the new shadow ministerial team to their posts. I have sat on those Benches in many questions sessions and understand how it can be at times.

Businesses of all sizes overwhelmingly supported the Labour party at the general election. How we behave in government will be exactly how we behaved in opposition, and we will co-design policy to ensure that. There is nothing in what we call the plan to make work pay—the new deal for working people—that is not already in the public domain. We had a manifesto with all that in it.

It is important to recognise—[Interruption.] There is a bit of chuntering coming from the Opposition Front Bench; again, something that I am not unfamiliar with. Look at the success of businesses in this area. Look at the businesses that already recognise trade unions and that already pay the living wage—look at that success. We are going to raise the employment floor, but it will be to a level above which many UK businesses are already operating. It is important to talk about the really successful things that businesses are doing to make sure that their workforces are treated with dignity and respect and get the living standards and prosperity that Members on this side of the House are all about delivering more of.