Government unveils 10-year Industrial Strategy

At the heart of this new strategy is a plan to unlock private investment, create high-quality skilled jobs, and drive sustainable growth, especially in sectors central to the UK’s long-term economic success.

The Strategy identifies two of the most significant barriers to business investment in the UK: high electricity costs and long waits for grid connections. To overcome these and other challenges, the government has laid out an ambitious action plan to reshape the business environment and restore Britain’s industrial competitiveness.

Key measures in the Industrial Strategy

The plan includes a sweeping set of reforms and investments to support UK businesses across all sizes and sectors:

• Lowering energy costs: From 2027, electricity-intensive manufacturers in high-growth and foundational sectors will benefit from electricity prices slashed by up to 25%, bringing costs closer to levels seen in other major European economies.
• Unlocking finance for business: The British Business Bank’s financial capacity will increase to £25.6 billion, including an additional £4 billion for priority industrial sectors, aiming to attract billions more in private capital—particularly for SMEs.
• Skills and training: The government will inject an extra £1.2 billion annually into skills funding by 2028-29, expanding opportunities for people to learn and earn in growth sectors. This includes new short courses funded by the Growth and Skills Levy and specialised training in areas like defence, digital, and engineering.
• Cutting red tape: Regulatory burdens will be reduced by slashing administrative costs for businesses by 25% and reducing the number of regulatory bodies, helping firms focus more on growth and innovation.
• Supporting SME innovation: An additional 5,500 small and medium-sized businesses will receive support to adopt new technology through the Made Smarter programme, while the Business Growth Service will centralise government support.
• Driving innovation: Public R&D investment will rise to £22.6 billion per year by 2029-30, with over £2 billion dedicated to AI and £2.8 billion for advanced manufacturing over the next decade.
• Global partnerships: The UK will deepen economic and industrial ties with key international partners, building on strategic agreements with Japan, the US, India, and the EU.
• Talent attraction: Visa reforms and a new Global Talent Taskforce will help attract world-class talent to key industries.
• Accelerating development: Planning processes will be streamlined with more planning staff, reduced pre-application requirements, and simplified environmental regulations to speed up business development and housing projects.
• Modernising public procurement: Reforms will reduce barriers for SMEs and new market entrants, boosting domestic competitiveness.
• Backing regional growth: Through a new £600 million Strategic Sites Accelerator and enhanced support from the Office for Investment and National Wealth Fund, the strategy will help regions develop investible sites and attract long-term investment.

Focus on eight high-growth sectors

The Strategy targets eight sectors identified as critical to the UK’s future prosperity: advanced manufacturing; clean energy industries; creative industries; defence; digital and technologies; financial services; life sciences; and professional and business services.

Each of these sectors will benefit from bespoke 10-year plans designed to attract investment, enable innovation, and create high-value jobs.

Automotive industry at the core of the strategy

Among the industries featured most prominently is automotive, a cornerstone of UK manufacturing and a key player in the transition to net zero. The government has introduced “Drive35”, a focused programme within the Strategy that brings together initiatives to support electric vehicle (EV) production, battery manufacturing, and supply chain development.

“The publication of an Industrial Strategy on Monday – one with automotive at its heart – is the policy framework the sector has long-fought for and government has now addressed.

“The Strategy begins to address some of the challenges our sector – like so many others – face, including energy, infrastructure, skills and access to finance.”

Hawes praised the government’s clear commitment to the sector, noting the Strategy’s long-term, cross-departmental approach and alignment with trade policy as crucial to restoring global competitiveness.

Strong endorsement from business leaders

The business community has responded positively to the Strategy, viewing it as a much-needed signal of stability and ambition. In a joint statement, leading business groups expressed support: “The Industrial Strategy launched today marks a significant step forward and a valuable opportunity for the business community to rally behind a new vision for the UK—boosting confidence, sentiment, and enthusiasm for investment.

“From start-ups and small businesses to large corporates, businesses need a more attractive, stable environment that enables faster, easier, and more certain investment decisions.

“We welcome the government’s engagement with businesses across the UK. Much of what we’ve shared has been heard and reflected in this strategy. While there’s more to do, we are ready to support the next steps.”

The statement was jointly signed by: Shevaun Haviland, British Chambers of Commerce; Rain Newton-Smith, Confederation of British Industry; Aaron Asadi, Enterprise Nation; Tina McKenzie, Federation of Small Businesses; Stephen Phipson, Make UK; Michelle Ovens, Small Business Britain; and Dom Hallas, Startup Coalition.

A new chapter for UK industry

The UK’s Industrial Strategy represents a significant step toward reindustrialising the economy, building world-leading sectors, and ensuring long-term prosperity. While successful implementation will be key, the Strategy provides the foundation for a more competitive, innovative, and resilient Britain, driven by business, powered by investment, and focused on the future.