Recommendations & Conclusions
20 items
3
Conclusion
34th Report - Department for Business a…
Acknowledged
The Department has issued a far-reaching letter of support, which commits it to supporting the Post Office to pay its liabilities as they fall due, but there is no clear plan for how long this will continue, or how to eventually make Post Office Limited financially independent. The Post Office …
Government response. The government agrees with the recommendation but provides no specific commitment or timeline for writing to the Committee with an assessment of financial support or plans for Post Office Limited's financial independence.
HM Treasury
17
Conclusion
34th Report - Department for Business a…
Acknowledged
The 2023–24 Annual Report and Accounts show that the Department provided £260 million in grants and subsidies to the Post Office and had total borrowings of £786 million with the Department, made up as follows: 30 Type of Support Description Value Annual support Capital Grants £90m Annual support Subsidies to …
Government response. The government acknowledges the committee's observation regarding the Post Office's financial support and borrowings, and commits to writing to the Committee in Autumn 2025 following the publication of the Treasury Minute.
HM Treasury
18
Conclusion
34th Report - Department for Business a…
Acknowledged
The Letter of Support also provides assurances for other financial risks that, were they to crystallise, may result in the Post Office not being able to meet its liabilities as they fall due.31
Government response. The government acknowledges the committee's conclusion that the Letter of Support provides assurances for Post Office financial risks and commits to writing to the Committee in Autumn 2025 with an update.
HM Treasury
19
Conclusion
34th Report - Department for Business a…
Acknowledged
We were concerned that the Letter of Support effectively acts as the Post Office having a “blank cheque” from the Department, and asked what conditions were attached to it.32 The Department told us that there is a rolling working capital requirement that the Department manage. The Department explained it involves …
Government response. The government acknowledges the committee's conclusion regarding concerns about the Letter of Support's perceived 'blank cheque' nature and commits to writing to the Committee in Autumn 2025 with an update following the Treasury Minute.
HM Treasury
23
Conclusion
34th Report - Department for Business a…
Acknowledged
The Bounce Back Loan Scheme (BBLS) was established as part of a suite of measures to provide support to small businesses during the COVID-19 pandemic, with a maximum loan value of £50,000. The loans were provided by commercial lenders directly to businesses, who were expected to repay the debt in …
Government response. The government acknowledged its responsibility for the ongoing management of the Bounce Back Loan Scheme.
HM Treasury
35
Conclusion
34th Report - Department for Business a…
Acknowledged
The Department for Business and Trade (the Department) was formed in February 2023 as one of three Government Departments which replaced the Department for Business, Energy and Industrial Strategy (BEIS). This action, is known as a ‘machinery of Government change’. This brought together the business-focused parts of the former BEIS, …
Government response. The government acknowledges the creation of the Department for Business and Trade in February 2023.
HM Treasury
41
Conclusion
34th Report - Department for Business a…
Acknowledged
The second key reason the Department gave for the delay in the completion of its 2023–24 accounts was that the finance team who were tasked with producing the accounts previously worked in DIT and had to understand the complex balances which the Department inherited from BEIS.67 DIT had total operating …
Government response. The government acknowledges the committee's conclusion regarding delays in its 2023-24 accounts due to finance team capability and complexity. It reports that Annual Report and Accounts production is progressing well and is on target for a September publication.
HM Treasury
45
Conclusion
34th Report - Department for Business a…
Acknowledged
This control framework is subject to annual review by the Government Internal Audit Agency (GIAA). GIAA provides four levels of assurance opinion following its reviews: substantial, moderate, limited or unsatisfactory.80 The conclusion for the Department in 2023–24 was ‘limited’, indicating there were significant weaknesses in the framework of governance, risk …
Government response. The government acknowledges the committee's conclusion regarding the 'limited' GIAA assurance on its control framework. It reports that Annual Report and Accounts production is progressing well and is on target for a September publication.
HM Treasury
10
Recommendation
33rd Report - Supporting the UK’s prior…
Acknowledged
While the Department is responsible for supporting businesses overall, it does not ‘own’ every sector of the economy nor is it responsible for every support intervention delivered by government. Many of the levers needed to bring about change to the business environment sit outside of the Department. The financial services …
Government response. The government acknowledges the recommendation and states the department developed the whole of the Industrial Strategy in partnership with other departments, with Sector Plans led by relevant departments and that this is an ongoing programme.
HM Treasury
11
Recommendation
33rd Report - Supporting the UK’s prior…
Acknowledged
The Department’s working relationships with others in government vary in maturity and other government departments have mixed views on the Department’s remit.20 To agree roles and responsibilities between departments, the Department told us it had introduced ‘handshake agreements’.21 However, the NAO’s report highlighted these had yet to be adopted by …
Government response. The government acknowledges the recommendation and states the department developed the whole of the Industrial Strategy in partnership with other departments, with Sector Plans led by relevant departments and that this is an ongoing programme.
HM Treasury
13
Recommendation
33rd Report - Supporting the UK’s prior…
Acknowledged
To monitor the performance of economic sectors and share information, the Department produces business intelligence products. The Department told us it recognised these products had not previously been shared well across Whitehall and that it had taken steps to do so in a more comprehensive and consistent way. The Department …
Government response. The government acknowledges the recommendation and states the department developed the whole of the Industrial Strategy in partnership with other departments, with Sector Plans led by relevant departments and that this is an ongoing programme.
HM Treasury
14
Conclusion
33rd Report - Supporting the UK’s prior…
Acknowledged
While it is not the only department to do so, the Department for Business and Trade directly supports industry through a range of interventions with a range of policy objectives. Some of the Department’s interventions are aimed at specific sectors whereas others are designed to improve the general business environment. …
Government response. The department currently supports industry through a range of interventions, the scale and form of which varies greatly, spending £790.9 million on business support grants in 2023–24, with 62.5% going to the advanced manufacturing sector and 29.9% to the energy …
HM Treasury
15
Conclusion
33rd Report - Supporting the UK’s prior…
Acknowledged
The Department tracks its programme spending, grant expenditure and Business Group resource spending across sector teams but does not have processes to break this down by support type using existing systems. In 2023–24, the Department spent £790.9 million on business support grants, 62.5% of which was allocated to advanced manufacturing, …
Government response. The department currently supports industry through a range of interventions, the scale and form of which varies greatly, spending £790.9 million on business support grants in 2023–24, with 62.5% going to the advanced manufacturing sector and 29.9% to the energy …
HM Treasury
17
Conclusion
33rd Report - Supporting the UK’s prior…
Acknowledged
While its primary objective is economic growth, the Department uses a range of metrics to guide its work, some of which require trade-offs. Factors considered by the Department when designing support initiatives include GVA, net zero ambitions, and national security. The NAO found that the Department lacked a standardised approach …
Government response. The government is aligning industry support with strategic priorities, including the Industrial Strategy, and will use new 'place-based business cases' to assess complementary projects in specific regions, with supplementary guidance on economic resilience.
HM Treasury
18
Conclusion
33rd Report - Supporting the UK’s prior…
Acknowledged
We asked the Department how it balances trade-offs when making decisions about support, and how it makes this explicit. Officials told us that it assesses interventions using HM Treasury’s five principles. Proposals are then put to Ministers who make decisions based on advice from the Department and their own understanding …
Government response. The government is aligning industry support with strategic priorities, including the Industrial Strategy, and will use new 'place-based business cases' to assess complementary projects in specific regions, with supplementary guidance on economic resilience.
HM Treasury
19
Conclusion
33rd Report - Supporting the UK’s prior…
Acknowledged
The Department noted that one of the criticisms of the 2017 Industrial Strategy was that it was too broad and not enough choices were made. The government has now designated eight growth-driving sectors, and the Department told us these were selected on the basis of joint analysis with HM Treasury, …
Government response. The government is aligning industry support with strategic priorities, including the Industrial Strategy, and will use new 'place-based business cases' to assess complementary projects in specific regions, with supplementary guidance on economic resilience.
HM Treasury
21
Conclusion
33rd Report - Supporting the UK’s prior…
Acknowledged
Following its formation in February 2023, the Department consolidated teams from the former BEIS and DIT into 25 sector-facing teams within its Business Group. These sector teams vary by size and grade distribution. The Department’s Business Group also has teams that work across sectors, such as the Business Intelligence Unit. …
Government response. The department will ensure effective implementation of the Industrial Strategy by using a permanent delivery unit and restructuring teams, which will be mostly completed by Spring 2026.
HM Treasury
22
Conclusion
33rd Report - Supporting the UK’s prior…
Acknowledged
We asked the Department about its overall priorities and whether it had aligned its resources accordingly. The Department explained that when the former DIT and BEIS merged, two sets of teams came together, which it structured around 10 economic sectors. Its directorates were approximately the same size, but the size …
Government response. The department will ensure effective implementation of the Industrial Strategy by using a permanent delivery unit and restructuring teams, which will be mostly completed by Spring 2026.
HM Treasury
23
Conclusion
33rd Report - Supporting the UK’s prior…
Acknowledged
We asked the Department if it was agile enough to respond to emerging issues such as changing tariff rates affecting UK businesses. The Department told us it understands the importance of ‘surging’ resource to where it is needed most urgently, and said it has been able to flex resources across …
Government response. The department will ensure effective implementation of the Industrial Strategy by using a permanent delivery unit and restructuring teams, which will be mostly completed by Spring 2026.
HM Treasury
24
Recommendation
33rd Report - Supporting the UK’s prior…
Acknowledged
The government’s forthcoming Industrial Strategy, which aims to channel support to eight growth-driving sectors, is expected to be published in spring 2025 alongside the Spending Review.49 The Department told us the eight priority sectors were collectively responsible for 30% of GDP and 60% of growth. To inform the Strategy’s design, …
Government response. The government has committed to regularly reviewing progress against the Industrial Strategy, supported by the ISAC through its expertise on monitoring and evaluation and continued advice on policy development and delivery.
HM Treasury