Amid stories of leaks to the press prior to notifying Parliament, the Government yesterday unveiled its active industrial policy to help people and businesses. Trade and Industry Secretary Stephen Byers and Education and Employment Secretary David Blunkett set out the Government’s next steps for raising GDP in the regions, closing the skills gap, helping industry through restructuring and nurturing new industries as they develop.
The White Paper “Opportunity For All In A World Of Change” sets out the Government’s action plan for the future.
A new regional policy
The Government’s goal is to increase the rate of growth in all regions: addressing underperformance and building on success. Raising the trend rate of growth by 0.5% for the worst performing regions would increase GDP in 10 years by 20 billion.
The measures include:
University Innovation Centres
The measure includes a major new drive to create hubs for growth in the regions based on imaginative new partnerships between universities, colleges and businesses. World class University Innovation Centres will be established in England. The first five are announced today involving companies such as BAe and Proctor & Gamble in the North East and Hewlett Packard in Bristol.
New Technology Institutes will be developed in each region to boost the supply of ICT and other high tech skills and transfer of know how to SMEs. This new network will produce a step change in the capacity of regions and communities to grow new dynamic businesses and hi-tech employment. The involvement of colleges will ensure skills and know how are cascaded into the wider community.
- a new £75 million incubator fund to support start-ups and growth businesses;
- special support to manufacturing industry through a new Manufacturing Advisory Service;
- developing strategies for success;
- support for clusters; and
- new early growth funding for start-ups and smaller growing businesses of up to £50,000.
Closing the Skills Gap
The Government inherited a situation of poor standards in schools and neglect of skills. Much has been done to tackle these problems. The goal now is to ensure all our people have the skills they need to be enterprising and creative and to deliver the world-beating technical skills business needs. The measures include:
- an action plan to drive up ICT skills including training up to 10,000 people each year through the new Technology Institutes which will have #25m new pump-priming funding;
- reducing the number of adults with literacy and numeracy problems by 750,000 by 2004;
- building a world class technical education system with a major rationalisation in qualifications and building up training in colleges and through apprenticeships; and
- a Job Transition Service to help communities and individuals affected by redundancy to find the right jobs more quickly.
The Government’s goal is to strengthen the ability of British business to innovate: ensuring that Britain has a world class ICT infrastructure and promoting the exploitation of scientific advances by business.
- an additional £90m to promote the commercial exploitation of research in basic technologies, genomics and e-science;
- a £30m fund to begin the process of ensuring as many people and businesses as possible across the UK have access to affordable broadband services; and
- measures to promote take up of digital TV, giving people without PCs access to the Internet.
Stephen Byers, Secretary of State for Trade and Industry, said:
“Our first task on taking office in 1997 was to get the basic foundations for economic success right, to ensure economic stability, competitive tax rates, investment in our science base, a regulatory framework which promotes competition and encourage enterprise.
“Now that the foundations have been laid we have a once in generation opportunity to radically change Britain for the better. This is why the Government is putting forward a number of policy initiatives of which this White Paper is one.
“In this White Paper we outline the vital next steps that Government, business and individuals must take to secure economic success in the decade ahead. It is only by providing opportunities for all that we will be in a position to achieve improved living standards for everyone.
“This White Paper sets out the challenges and the early next steps for Government. It sets out active policies that will enable the talents of all our people to be put to use. Policies that will widen the winners circle in every region – for it is impossible to have economic success with a divided society. If we manage to raise growth by 0.5% in the worst performing regions over the next 10 years we could see a #20bn increase in GDP.
“Change for business is nothing new but the pace of change can be threatening for business and people. As an active, enabling Government our task is to equip people to adapt to change, to help open up new opportunities for industry and enable established industries to modernise their business. This White Paper sets out a challenging and exciting programme of work for Government.”
David Blunkett, Education and Employment Secretary, said:
“In this White Paper we set out for the first time a truly joined up strategy for skills and business development. We show how an active, enabling government can equip people to adapt to the rapid economic and social changes which face them and open up new opportunities for industries. We must, and will, give people the tools to cope with change and to capitalise on the opportunities it creates.
“A well-trained and highly-skilled workforce is an essential base for this country’s economic success. The measures we are setting out today will mean that our companies can compete in the global market place, and we will have a generation of workers equipped with the skills that they need for the future.
“The University Innovation Centres will boost research and development. The Technology Institutes will ensure a supply of hi-tech skills, especially to smaller businesses that need this expertise most. Together they will mark a significant change by driving forward skills improvements and regional economic development.”
Other measures in the White Paper include:
- the establishment of a new Enterprise Scholarship programme for the brightest and best young graduates around the world who want to come to the UK to start new businesses and careers;
- proposals to reform insolvency law: cutting by two thirds, to 12 months the maximum default period during which people against whom a bankruptcy order has been made are subject to remaining restriction, but increasing the restrictions to 15 years for dishonest and negligent bankrupts;
- giving the Office of Fair Trading and other regulators a new pro-competition role to spot existing and proposed laws and regulations which hold back dynamic and competitive markets; and
- commissioning a major study to quantify the benefits of achieving European economic reform, to make the case for change in Europe just as the Cecchini report did in the 1980s.