The Lib Dem Campaign for Manufacturing had a hugely successful start, with the first campaign aim being implemented in the Autumn Statement. Our proposal on capital allowances saw the Chancellor increase the annual investment allowance from £25,000 to £250,000 for a two year period. This move by the Treasury will help businesses invest in plant and machinery and I am already seeing the difference in Burnley with a number of firms taking advantage of the initiative.
As thrilled as we all are with the increase in capital allowances, the campaign to strengthen manufacturing does not stop there. To continue improving the manufacturing sector the Government must ensure they continue to heavily invest in the three following areas: apprenticeships and training, export support, and the supply chain.
The UK produces some fantastic products exported around the world and we are world leaders in the aerospace manufacturing sector. The government has recognised that the fractured supply chain is harming productivity and exports and has sought to address this through the Advance Manufacturing Supply Chain Initiative. The Lib Dem campaign for Manufacturing supports this proposal and urges the Government to take the lead in key manufacturing clusters, as identified in the Industrial Strategy. The government is best placed to bring UK manufacturers together and facilitating collective R&D, where there is a common industry agenda, could help to overcome the challenges in the UK supply chain in partnership with manufacturers.
By improving the supply chain we can help UK companies import less and export more. I am keen to see more initiatives introduced to boost exports (over half the UK’s exports is in manufacturing) including further investment in UK Trade & Investment with a particular focus on small and medium exporters. This would be in addition to the scheme announced in the Autumn Statement 2012, to provide up to £1.5bn of loans for the purchase of UK exports.
All of the work the government is doing to strengthen the manufacturing sector will be useless however, if we do not ensure the skills gap is well and truly addressed. The Lib Dem Campaign for Manufacturing welcomes all attempts by the government to boost apprenticeships and make manufacturing more attractive to young people. But the skills issue is still the biggest issue and the one mentioned to me by every manufacturing firm I talk to from small local family firms to BAE, Airbus and Rolls.
That is why at conference I will be urging the Government to continue its commitment to apprenticeships, and, additionally, encouraging the promotion of science education in schools and science and engineering degrees at universities. These are essential for building the skills sets necessary to support a strong manufacturing sector.
* Gordon Birtwistle is Member of Parliament for Burnley, Chair of Lib Dem Parliamentary Committee on Business, Innovation and Skills, co-founder of the Lib Dem Campaign for Manufacturing and and Chair of the All Party Parliamentary Group on Apprenticeships.