Source · Select Committees · Business and Trade Committee
Recommendation 3
3
Accepted
Clarify how industrial strategy balances growth, net zero, economic security, and regional objectives
Recommendation
The industrial strategy must clarify how the Government plans to balance any tensions between maximising the headline rate of growth, supporting new sectors and existing jobs in industry, and achieving its net zero, economic security and regional growth objectives. (Recommendation, Paragraph 30)
Government Response Summary
The government accepts the recommendation by clarifying that the Industrial Strategy balances tensions by selecting priority sectors and frontier industries based on a multi-indicator assessment that ensures alignment with growth, net zero, economic security, and regional growth objectives.
Government Response
Accepted
HM Government
Accepted
1.1. Strategies make choices. The Industrial Strategy Green Paper, published in October 2024, identified the Industrial Strategy eight growth driving sectors using a multi-indicator assessment of current and emerging UK sector strengths. The main indicators assessed were output growth, productivity growth and international position. IS-8 were chosen based on this analysis as the sectors that should increase overall investment. These sectors will create the right kind of growth; sustainable, inclusive and secure. The aim in selecting these sectors for the Strategy is to create a more dynamic and competitive landscape, where challenger firms can emerge and create high-quality jobs, and incumbents have to invest to compete. 1.2. Since the Invest 2035 publication, the department has undertaken a full assessment of frontier industries’ strengths within the Industrial Strategy eight growth driving sectors, as well as considered supporting foundational sectors. This included an assessment of how these industries align with the government’s objectives of sustainable, inclusive, and resilient growth. 1.3. The department also assessed the fronter industries where government intervention could have the greatest impact. This identified over 30 ‘frontier industries’ within the Industrial Strategy eight growth driving sectors as well as eight supporting foundational sectors and inputs which were critical to these frontier industries’ success. 1.4. The trade-off between growth and other objectives was handled by selecting frontier industries that were good for both growth and other objectives. Frontier industries needed to have good growth opportunities to be included but also needed to score well on one or more of the strategic objectives of net zero, regional growth, and economic security & resilience.