Specialist Manufacturing Sector: Regional Economies

Wednesday 19th November 2025 Westminster Hall

09:30

[Josh Fenton-Glynn (Calder Valley) (Lab)]

I beg to move,

That this House has considered the contribution of the specialist manufacturing sector to regional economies.

It is an honour to serve under your chairmanship, Mrs Harris, and a privilege to open this debate on the contribution of the specialist manufacturing sector to regional economies. The number of colleagues who have joined us this early on a Wednesday morning is a mark of just how important this issue is to so many constituencies.

Manufacturing is the backbone of our economy. This country is unique. We do not mass-produce rubbish; we make specialist things that only our foundries and factories can produce. Decent manufacturing brings good jobs but also economic power to our country. Manufacturing contributed £217 billion in output to the economy last year—nearly 10% of GDP—and supported 2.6 million jobs.

Calder Valley has manufacturing in its history. The story started with wool, but has developed into chemicals and specialist manufacturing. As new businesses opened in old mills, we also focused on particular industries. Calder Valley has long been known for its engineering. We are home to what many call valve valley, a cluster of more than 20 firms that design, build and service valves that are used across the world. In the valve community, which I mainly discovered after becoming an MP, Brighouse and Elland are central hubs. These companies are not household names, but they are businesses that keep industry moving, from energy to water to pharmaceuticals. They employ local people, train apprentices and anchor our economy in towns that too often feel overlooked.

When I visit manufacturing and engineering firms in Calder Valley, I see the same thing again and again: highly skilled workers who are proud of the worldwide reach of their products, from 60% of water in New York city travelling through valves made in Brighouse to oil rigs in the North sea being made safer because of the expertise of workers in a West Yorkshire factory. I see innovation, with companies investing in new technology and tapping into various sectors such as defence, renewables and nuclear. I see resilience, because these businesses have survived downturns and global shocks, yet they continue to provide good jobs in Calder Valley.

But we cannot ignore the fact that the numbers working in manufacturing are falling. As of 2024, 15% of jobs in Calder Valley are in the manufacturing sector, compared with a national average of 7%, but that share has been declining. In 2007, just under a quarter of jobs in Calder Valley were in manufacturing. From the financial crisis to Brexit and the Tories’ disastrous deal, the past couple of decades have ripped the heart out of our manufacturing industry.

We will hear a lot in the next few weeks about growth and so forth. It will come as a relief to many Members that I am not in the Treasury, so rather than talking about statistics, I will share what local manufacturers tell me. They tell me that their order book has never been so bad, because of the impact of tariffs. The lack of stability means companies are not making long-term decisions that would see them step up. That is why we need a strong domestic manufacturing sector, but it is also why we need to be strategic in our support for the industry and how we spend our money on the infrastructure that we need to rebuild.

If we are serious about Labour’s promise that two thirds of young people will go to university or achieve a high-level qualification, this is exactly the kind of work we need to encourage. We need to make sure that those qualifications are linked to opportunities in advanced manufacturing, engineering and design. That means working with local authorities and businesses to understand the needs of industry in each region.

[Mr Gregory Campbell (East Londonderry) (DUP)]

I congratulate the hon. Member on securing this debate. On the point about training and upskilling, does he agree that we need to do more to develop the skills and competitiveness of our manufacturing base, and that that needs to spread beyond the large cities so that smaller towns and their residents can benefit?

[Josh Fenton-Glynn]

The hon. Gentleman is absolutely correct. The point about smaller towns is so important, because as well as creating brilliant jobs in the smaller economy where they will make a difference, they give a sense of place and value to what we produce. People are proud of what their town produces, whether it is valves or textiles, and they think of those things as defining their town. That commitment is something that only a small town can offer, and it really makes a difference.

Businesses in this country are ready to grow, but they need support with skills, infrastructure and investment. They need to know that their order book is guaranteed for the long term. The Government have made really positive noises about encouraging skilled apprenticeships; that is welcome, but apprenticeships work only if the companies can afford to hire and train young people. We need to ensure that small and medium-sized manufacturers, which are the lifeblood of Calder Valley and other small towns, have the support that they need to take on apprenticeships without being too financially stretched.

In September, I visited the Brighouse-based training charity West Yorkshire Manufacturing Services, as part of National Manufacturing Day. It showcased a range of firms in Calder Valley to school students. I also met Stuart Billingham, who is set to become the managing director of KOSO Kent Introl next year. The company, founded in Brighouse, employs about 150 people and exports specialist valves across the world. Stuart started at 16 on a youth training scheme and has worked his way up the company to become its managing director. His journey is a brilliant example of how skills and apprenticeships can lead to as rewarding, lucrative and challenging a career, with as massive a global impact, as we are often told that universities can. It shows that those careers have progression and responsibility. I want this Government to produce 1,000 Stuarts, albeit that some of his close friends might not want that many Stuarts.

At that event, there was so much interest from young people and so much curiosity about the opportunities that a career in manufacturing could bring. That spark of curiosity must be nurtured into a flame of ambition, especially at a time when too many young people feel pressured into pursuing degrees that may not suit them or lead to secure employment.

[John Slinger (Rugby) (Lab)]

I praise my hon. Friend for securing this important debate. On apprenticeships, I wonder whether he would care to comment on the excellent work of the Catapult centres, which are Government-funded and which work collectively between business and academia. In my constituency of Rugby, at Ansty Park, we have the Manufacturing Technology Centre, which has its own training facility. It has already trained 1,200 apprentices. That can only be a good thing for our region, and particularly for our young people who want to get on and get jobs.

[Josh Fenton-Glynn]

Yes, 1,200 apprenticeships is 1,200 decent jobs and 1,200 families who have pride that their son or daughter will make a real difference and make products that make it around the world. That is why this matters.

Only 14% of apprenticeships that started in the past academic year were in engineering and manufacturing, however. The Institution of Engineering and Technology has reported that engineering faces one of the largest skills shortfalls in the economy, with more than 46,000 vacancies in the sector. Similarly, the welding industry needs 35,000 more people. That is the key to growth. It represents a real opportunity to support young people into secure, well-paid work. Without it, our manufacturing sector will be in trouble.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

I agree with everything that the hon. Gentleman is saying, but may I encourage him to go one step upstream and look at some of the wider policy context? If we are to regrow our manufacturing base, as we absolutely need to, we have to accept that it will be about future technologies, not just replacing what we had in the past. In my constituency, the development of tidal energy offers a supply chain of 80% UK product, which would then be exportable. If we could capture that, we would have something special—but for that to happen, we need a better policy framework to come out of the Department for Energy Security and Net Zero.

[Josh Fenton-Glynn]

We have to be really bold. We need to look at our future-focused industries and at what we specialise in. The right hon. Gentleman talks about tidal energy, but we will not be able to produce that without a load of specialist valves. I want to ensure that they are built in Calder Valley and go throughout the country. That is what this debate is about: we need to plan and think, but we also need to look at what we do well.

The imbalance between small and large manufacturing companies is accentuated by the fact that larger companies often secure Government contracts, particularly in defence. Not only does that provide them with guaranteed revenue, but it often allows them to poach skilled staff from smaller firms that cannot compete with the salaries and the security that those contracts bring. Yorkshire and the Humber received the least defence spending per person, despite the fact that across our region we have a manufacturing sector that is eager to grow and develop.

[Sarah Dyke (Glastonbury and Somerton) (LD)]

The hon. Gentleman is making an excellent speech. As he knows, the south-west has a brilliant, large defence-related manufacturing sector. Needles and Pins Aerospace is a small, women-led business based in Somerton that provides precision textile engineering for aviation and defence. It should be entitled to the same opportunities to compete on a level playing field for the larger contracts. Does he agree that if the Government are prioritising value and security, they should offer equal commercial opportunities to UK businesses and supply chains in respect of defence and security-related manufacturing contracts?

[Josh Fenton-Glynn]

I absolutely agree. The Defence Office for Small Business Growth—I believe it will open in January, but the Minister will know better than me—will be a great opportunity to grow businesses such as Needles and Pins Aerospace in the hon. Lady’s constituency and the many businesses in my constituency that want to get into the defence industry. She is right that the south-east does very well out of defence. In fact, the defence industry supports 85,000 direct jobs in the south of England, but just 3,750 in Yorkshire and the Humber.

As part of the Government’s mission to make defence an engine for growth, there should be a concerted effort to spread its benefits across the regions and our small towns, as the hon. Member for East Londonderry (Mr Campbell) said. We will grow this economy only if the Government interact with industry, including in Calder Valley and West Yorkshire, in a way that encourages competition rather than dominance. Smaller manufacturers are equally vital and are a sign of a balanced and resilient economy. They must be supported if we are serious about building the balanced and resilient industrial base that we really need.

Valve manufacturing is a reminder that regional economies thrive when we back specialist sectors. It is not about chasing the latest fad; it is about recognising and building on our strengths. In Calder Valley, that means supporting our manufacturers with a skills pipeline, and with the apprenticeships and investment that they need to grow. We can use the power of the public purse to do that, but—I will be honest—we have failed to do that over multiple years and multiple Governments. The new nuclear power station at Hinkley Point has more than 100,000 valves, but they are all made in China. The only company in Calder Valley that has benefited is the company that fixes faulty valves, because the quality is not as good as that of British-made valves. If we expect other countries to use our high-quality valves in manufacturing, our Government must lead by example.

This is about the pride that people feel when they know that something they made in their town is used in projects around the world. It is about the contribution that specialist manufacturing makes to identity as well as GDP. It is about ensuring that places such as Calder Valley are not left behind, but are recognised as central to Britain’s industrial future.

I will finish by making a few points directly to the Minister. In Calder Valley, we know how vital apprenticeships are, yet only 14% of apprenticeships last year were in engineering and manufacturing; what will the Government do to ensure that new training opportunities match the skills shortages that we face, such as those in welding and advanced engineering? Our small and medium-sized manufacturers are the lifeblood of towns such as Brighouse; how will Government support for apprenticeships and investment reach those firms rather than being skewed towards the largest players? Defence strategic procurement could be a real engine for growth in places such as Calder Valley; will the Minister set out how contracts will be used to back British industry, particularly in specialist sectors such as valve manufacturing and precision engineering?

[Several hon. Members rose—]

[Carolyn Harris (in the Chair)]

Order. I remind Members that they need to bob if they wish to speak in the debate. I will impose an informal time limit of five minutes to allow all Members to get in.

09:44

[Jim Shannon (Strangford) (DUP)]

Thank you for calling me early, Mrs Harris; you are very kind. I am sure hon. Members are wondering why. I thank the hon. Member for Calder Valley (Josh Fenton-Glynn) for securing today’s debate. In his short year and a half in the House, he has shown himself to be assiduous on behalf of his constituents. He works hard, with a key focus on the subjects he brings to the House, both in the main Chamber and here. Well done to him.

Our manufacturing sector is crucial to the UK-wide economy. We must not forget the unique build-up of this country. I always say that we are better together, and there is no Scots Nats person here to tell me otherwise—not that that is a bad thing, but anyway. Whether it be Scotland, Wales, Northern Ireland or England, we can do it better, with a significant contribution to the manufacturing industry.

Library research highlights that in 2023, Northern Ireland added £2.2 billion gross value added in manufacturing economic output. In 2024, around 900 direct jobs were supported by the defence industry. Defence plays a crucial role in Northern Ireland, but it does not get its full percentage of defence contracts. I gently put that point to the Minister to get a helpful answer. The defence sector should get more contracts, although there have been lots of commitments.

With great respect, Northern Ireland people—men and women—have proven themselves as leaders in their contribution to the sector. The best is yet to come, with more young people becoming interested in all aspects of manufacturing and engineering. There is a keen interest in science, technology, engineering and maths study and employment in Northern Ireland, especially from young people and from women who have leading roles in manufacture. We are doing and seeing good things happening; we see equality and opportunity.

This is a good news story. Northern Ireland is home to major companies such as Thales and Bombardier. Bombardier at one stage had two major factories in Newtownards, hiring hundreds of people from the local area, showing our skill in the design and manufacture of composites and polymers. I usually visit Thales at least once a year with my right hon. Friend the Member for Belfast East (Gavin Robinson), who told me that the majority of the workforce live in my constituency of Strangford, so it is obviously to my advantage to be there.

The good news with Thales is that, with Government help, 200 new jobs have been created there. There are also important apprenticeship opportunities. Given my age, I have known some of the young fellows there since they were born. Aged 18, 19 or 20, they now have jobs at Thales, with fantastic opportunities, a good wage and help with their student fees. I have met unions on various occasions to hear their concerns, and have brought this issue to the Floor of the House to seek assurances.

There are some things I ask of the Minister. It would not be right to take part in this debate without highlighting the risks in the manufacturing industry relating to job security. At times like these, the Government are able to step in. That is my Great British Government, and everybody’s Government, whether we voted for them or not. On this occasion, efforts fell short in committing to the manufacturing industry in the way we wanted. I will mention Spirit AeroSystems, the plane manufacturer, and the contribution made by Northern Ireland. Northern Ireland may be a small nation, but we are mighty—a word not often used—just like small David, who took on big Goliath in the Bible and beat him.

Alongside Scotland, Wales and the mainland, specialist manufacturing is crucial to economic prosperity. There must be an unwavering determination to achieve that. I ask the Minister to engage with me and my hon. Friend the Member for East Londonderry (Mr Campbell) and other Northern Ireland MPs to ensure that, when it comes to helping each other, to make this great United Kingdom of Great Britain even greater and better, we do that together. It takes that commitment. Will the Minister work alongside a Northern Ireland Assembly Minister, the Assembly and us to deliver for everyone?

09:49

[Dr Allison Gardner (Stoke-on-Trent South) (Lab)]

It is an honour to serve under your chairship, Mrs Harris. I thank my hon. Friend the Member for Calder Valley (Josh Fenton-Glynn) for securing this debate and for his call for the use of British parts in British infrastructure.

The debate is incredibly pertinent to my constituency of Stoke-on-Trent South and to neighbouring areas across north Staffordshire, and unsurprisingly my colleagues from Stoke-on-Trent are here with me today. Ours is a post-industrial city and, typically for the coalfield and other regions across the north and midlands, we have lagged behind others in wage growth and investment. Although we rightly take pride in our industrial past and heritage, we must also look with ambition to our future. North Staffordshire is the home of the British ceramics industry, and we are incredibly lucky to have manufacturing specialisms in advanced ceramics, which form part of the supply chains for critical industries and the IS-8—the eight sectors identified in the industrial strategy.

Without ceramics, we cannot have steel, glass or mobile phones. The industrial strategy rightly recognised ceramics as a foundational industry, and I am delighted that the national materials innovation strategy, championed by the Henry Royce Institute, recognises the importance of ceramics as critical materials. Ceramic materials are used in specialist components for high-tech industries, and I will name just a few. They are used in implants and prosthetics in the healthcare sector and as jet engine coatings for civil and defence aerospace. They are used in fuel cells for small modular reactors and in defence applications including rocket components, antennas, surveillance and armour. In fact, they are the only class of materials capable of enabling hypersonic weapons for defence.

North Staffordshire’s advanced ceramics industry is therefore a cornerstone of the UK defence capability. We have a well-established cluster for advanced ceramics in our region, with established companies and research consultancies. That includes Mantec, Ross Ceramics and Lucideon. Lastly, north Staffordshire is incredibly lucky to have AMRICC—the Applied Materials Research, Innovation and Commercialisation Company, which is the Government-funded centre of excellence for advanced ceramics.

The global ceramics market was valued at £200 billion in 2024 and is projected to reach £358 billion by 2035. Advanced ceramics account for 54% of that market, with the UK holding a share worth £4.5 billion, so the opportunity for growth here is clear. I must stress, however, that advanced ceramics are only part of the advanced manufacturing specialisms in our part of the country. The west midlands has the UK’s second highest number of advanced manufacturing jobs and contributes 6.7% of total GVA. In my constituency, the engineering manufacturer Goodwin produces materials for submarines, aeroplanes and advanced surveillance systems.

Key to the potential for growth is the A50/A500 growth corridor, the nexus of which is in Sideway in my constituency. It is the key connector between Cheshire, Staffordshire, Derbyshire and Nottinghamshire. Along the A50/A500 growth corridor are world-renowned advanced manufacturing companies, including Bentley, JCB and Toyota. That growth corridor connects more than 1 million people and 500,000 jobs in clean energy, hydrogen and technology. If we extend to Nottingham, it connects three university city regions, and if we use the East Midlands rail line, it will take us all the way to Lincolnshire.

Midlands Connect has estimated that the A50/A500 project, along with the building of more houses, will generate more than £12 billion in GVA, could create up to 39,000 new jobs—an unbelievable number—by 2045, and has a projected annual growth rate of 1.6% until 2070. He will tell me off for doing this, but I am going to quote the chief executive of Stoke-on-Trent city council. He said to me that it “could deliver a greater bang for its buck than the northern powerhouse.”

The project requires £3 million to develop the business case. I therefore ask my hon. Friend the Minister to support the project and development of the business case. The economic benefits from the project would link manufacturers in north Staffordshire to the east midlands, with strong implications for devolution and economic growth across the regions. I believe that it might be worth considering a north midlands strategic authority to unlock those benefits further, as the corridor is a critical supply chain and distribution artery for businesses to the east and west and, indeed, the north and south, because it connects the M1 and M6.

There is an incredible amount of specialist manufacturing in our regional economy, particularly in the advanced ceramics sector. With the right investment in innovation, infrastructure and skills, the north midlands advanced manufacturing corridor could become a leading growth hub for our regional economy and the UK economy more broadly.

09:54

[Rebecca Smith (South West Devon) (Con)]

It is a pleasure to serve under your chairmanship, Mrs Harris. I welcome today’s debate. Plymouth and the surrounding area boast some of the finest examples of British advanced manufacturing. Babcock refits the Royal Navy’s frigates, maintains our nuclear deterrent and assembles the Supacat Jackal armoured vehicles at His Majesty’s Naval Base Devonport. Today, Helsing is opening a resilience factory in my constituency, manufacturing autonomous underwater gliders to protect critical infrastructure. The date was supposed to be last week, so I went to visit. Unfortunately, I am here for this debate today rather than there for the official opening today, but it is an exciting opportunity for my constituency of South West Devon and Plymouth as a whole. The company was attracted to the city because of its easy access to deep water for testing and sea trials of marine autonomy. For similar reasons, Thales at Turnchapel Wharf is delivering the first end-to-end autonomous maritime mine-hunting system to the Royal Navy.

Plymouth’s industry is not just defence companies equipping the men and women in uniform with world-class kit. Mars Wrigley, a company I visited last month, manufactures its chewing gum in Plymouth. Alderman Tooling, another advanced manufacturer in Plympton in my constituency, is a metal fabrication company that produces a range of products, including metal bed feet, bus handrails and displays for museums and fashion retailers. Plessey Semiconductors, Demon Pressure Washers and Princess Yachts are all significant to South West Devon, and many other businesses manufacture in neighbouring Plymouth constituencies.

It should therefore come as no surprise that Plymouth wears the crown as the south-west’s pre-eminent manufacturing city, ranking ninth across the UK. This is within the south-west region, which has the third highest proportion of advanced manufacturing jobs in the country, employing 86,500 people. Indeed, the Plymouth Manufacturers’ Group represents over 50 local businesses right across the city, employing almost 5,500 people.

With the current focus on the defence sector across the country and in Plymouth, it is easy to just focus on the prime companies: Babcock, BAE Systems and Rolls-Royce. However, it is important to also recognise the immense contribution of small and medium-sized businesses to the advanced manufacturing sector—both the defence supply chain and the wider manufacturing sector that populates Plymouth and the surrounding area.

Plymouth’s regeneration is being led by manufacturers, small and large, in our city. Our city’s future success is tied to theirs. The city’s offer is impressive and often overlooked. Our advanced manufacturing sector contributes hundreds of millions of pounds of GVA to the local economy and the country as a whole. Defence in the south-west adds £3.6 billion of GVA, with 43,500 jobs. However, it is well documented that Plymouth has a skills shortage. This in turn risks local growth, social cohesion and cost increases to the defence programme. To unlock Plymouth’s potential, we must meet those challenges head-on.

Recent data has highlighted that as many apprenticeships are needed by local SMEs as by defence primes—something we must be alive to as we promote our manufacturing sector and the skilled employees required. That is especially the case since high wage inflation—something already mentioned—brought about by the demands from the defence primes can impact those critical SMEs that also provide significant numbers of jobs and need to grow their skilled workforce, too.

We are not alone in this reality in the south-west. Recent Transport Committee hearings that I was part of have focused on the skills shortage in transport manufacturing, too. We often hear about welding, but ultimately those welders are needed right across the country in a whole range of jobs. It is very important we ensure that that supply and demand match each other. I am particularly interested to hear how the Minister can address that, because I sit in those meetings hearing about the need for welders, and I am not convinced that there are enough young people out there to fill those jobs, so I am interested to hear the Minister’s thoughts. The need for a laser focus on skills is crucial, and a reality check is needed on the numbers required across all manufacturing sectors to ensure we tackle the demand effectively.

Although I welcome the Government’s defence spending and commitment to Plymouth, I am watching to ensure that their investment also addresses the broader systemic challenges I outlined facing Plymouth’s advanced manufacturing sector. Labour has pursued policies that actively harm our SMEs. The jobs tax is costing small businesses £615 more a year per employee, and the Employment Rights Bill is tying them up in red tape. I hope that the Chancellor is taking a second look at the harm that those policies are causing to small businesses ahead of the Budget next week.

Plymouth is an exciting place to set up a business, with the Plymouth and South Devon freeport providing incentives and a skilled workforce that is growing every day, even with the challenges I have mentioned, all in the most beautiful place in the country to live. It is clearly the place to be to invest and to seek those jobs. My hope is that the Government will help and not hinder the city’s potential.

09:59

[Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)]

It is a pleasure to serve under your chairmanship, Mrs Harris. I congratulate my hon. Friend the Member for Calder Valley (Josh Fenton-Glynn) on securing the debate. We do not talk nearly enough about manufacturing in this place—I am sure the Minister would agree with that, given his personal commitment and understanding of the sector from his previous role.

I very much enjoyed the speech by the hon. Member for South West Devon (Rebecca Smith). I am sure that parts made in my constituency, at Meighs & Westleys, Goodwin or Mantec, make their way down to her local businesses, but I say gently to her that scaremongering about the Employment Rights Bill is a disincentive to industry and a restriction on our economy. The Bill is not yet anywhere near implementation.

[Rebecca Smith]

Will the hon. Gentleman give way?

[Gareth Snell]

Very briefly, as long as the hon. Lady is going to admit that she is wrong.

[Rebecca Smith]

I am not going to do that. Many businesspeople across my constituency have contacted me to stress how damaging the Bill will be. It seems to be more of an ideological issue on which Opposition Members differ. The red tape, particularly around things like zero-hours contracts, will have a massive impact, but I guess the proof will be in the pudding.

[Gareth Snell]

I am many things, but I have never been called an ideologue. We can have a debate about the Employment Rights Bill on a different occasion, but I suggest that securing the right for people to know what hours they are working does not seem to me like a minimum ask for anybody.

I am glad that my hon. Friend the Member for Calder Valley raised the importance of manufacturing to pride in place. He rightly talked about the valves made in Calder Valley, and he will know that I and my colleagues from north Staffordshire talk quite a lot in this place about ceramics and pottery—I cannot imagine your disbelief, Mrs Harris, but it is true. We talk about that because we are proud of the things that we make. We are proud to know that the tableware in our dining rooms was made by Duchess in Stoke-on-Trent, and the gifts in the Lords gift shop were made by Halcyon Days in Stoke-on-Trent. There are Wedgwood plates, Spode mugs and Burleigh prints all around this building that were made in Stoke-on-Trent.

It is not just Stoke-on-Trent that has a unique commitment and an integral identity connection to manufacturing. Think about the cutlery manufacturers of Sheffield, the jewellery quarter in Birmingham, the shoe manufacturers of Northampton, the knitwear and textiles in Scotland and, of course, the shipyards of Barrow and Belfast—clear commitments to industry that have helped to shape people’s identity. That is why we have to think about what regional investment means. We are proud of the things we make: they contribute to our local economy, which therefore contributes to the national economy. The supply chains need to stretch right across the whole United Kingdom because, as the hon. Member for Strangford (Jim Shannon) says, this is about the nations and regions of this country coming together to do what we all do best in our localities for the greater good of the nation.

In Stoke-on-Trent we do not just make tableware, giftware and ceramics; it is also proudly home to a factory that makes all the cherry bakewells in this country. I did not know she was here this morning, but one of our guests in the Public Gallery works in that factory. The workers there are proud of what they do and their creation of pastry, frangipane, icing and hand-placed cherries.

[Rachel Gilmour (Tiverton and Minehead) (LD)]

Did the hon. Gentleman bring any with him?

[Gareth Snell]

No—but those workers know how they contribute to our national economy.

When manufacturing, pride in place and identity overlap, that is something to be celebrated, because it drives innovation. Hannah Ault of Valentine Clays in Stoke-on-Trent is incredibly proud of the work she does. She is formulating a new clay that can be baked at a lower temperature for a shorter period of time, because she has an intense connection to the ceramic sector and the use of such skills. That research and development would not ordinarily happen; it happens because of her connection to a place and the support she can give to a sector that still has things to make.

I want to press the Minister on two points. First, on procurement, it is a travesty that only a third of the cars in the Government Car Service are made by British manufacturers. The proportion is even less for police cars purchased in this country. We have bus manufacturers, train manufacturers and brick manufacturers in this country, all of which make wonderful products, yet we import products from other parts of the world. Local and regional manufacturers can make them at better quality and lower cost if we give them the opportunity, but to do that the Minister—he knows what I am about to say—has to get a grip on industrial energy costs, which I know he is doing.

Small manufacturers in this country face some of the highest industrial electricity prices anywhere in the world, and although our gas prices are relatively competitive with Europe, they are much higher than they were two or three years ago. Small manufacturers need help with export finance to ensure that they can go to trade shows and exhibitions. We also have to get a grip on skills; it is brilliant that T-levels are coming online, but they have to come online quicker.

10:04

[Rachel Gilmour (Tiverton and Minehead) (LD)]

I thank the hon. Member for Calder Valley (Josh Fenton-Glynn) for securing the debate, and not least for mentioning one of the many shocking things about Hinkley C in my constituency.

My Tiverton and Minehead constituency is home to some truly remarkable specialist manufacturers whose contributions extend far beyond our borders and into the global economy. I have chosen to confine my speech to just three examples—so apologies to HepcoMotion, Rotolok and others.

Heathcoat Fabrics is a shining example. Founded by John Heathcoat, it has a storied past. After the factory in the midlands was destroyed by the Luddites, Heathcoat led his workforce to the south-west and established a major lace-making enterprise in Tiverton in 1816. Ahead of his time and a thoroughly righteous man, not only did he build a thriving business, but he invested in the welfare of his workers, building a series of cottages for them. The homes are, of course, still standing, and are well lived in by Tivertonians today.

The company carried forward Heathcoat’s vision and ethos of worker welfare, providing pensions to employees before Lloyd George’s Old Age Pensions Act 1908. Today, Heathcoat Fabrics designs specialist fabrics that are trusted by NASA for its space missions. I say that again: trusted by NASA. Enough said—wow. It is quite the distinction, and a testament to Heathcoat Fabrics’ world-class innovation.

Impressive, too, is Shearwell Data, a family-run business based in Wheddon Cross, Somerset. Under the leadership of director Richard Webber, Shearwell has become a global leader in livestock-monitoring systems. Its technology supports farmers worldwide and is backed by advanced data storage and a remote support network that stretches across continents. Agriculture is a way of life in our part of the world, and Shearwell’s success puts Somerset firmly on the map in conversations about agricultural innovation.

I also want to mention Singer Instruments, which is based in Roadwater, in Watchet. Its precision instrumentation accelerates scientific discovery, supporting and supplying labs in more than 60 countries and in every corner of the globe. It is a source of great local pride to know that such cutting-edge science is powered by a company rooted in the constituency.

Although it is not in my constituency—it is just over the border—it would be remiss of me not to mention Agratas, Tata’s global battery arm, which is building the UK’s largest electric vehicle battery factory. Once fully operational, it is projected to generate more than £700 million annually for the south-west economy, and will be a significant employer, with around 4,000 people across the full site—opportunities for talented constituents of mine.

All those enterprises form the backbone of a flourishing hub of specialist manufacturing. They demonstrate how innovation, resilience and a healthy dose of ambition can drive prosperity for our communities and contribute to the wider south-west regional economy.

10:07

[Alison Hume (Scarborough and Whitby) (Lab)]

It is a pleasure to serve under your chairship, Mrs Harris. I congratulate my hon. Friend the Member for Calder Valley (Josh Fenton-Glynn) on securing the debate, and echo his calls to buy British.

As the first seaside resort in Britain, Scarborough pioneered bathing machines for women—horse-drawn sheds on wheels—who entered the ocean clad in vast garments, helped by servants. In those days, it was all about protecting modesty, but today the innovators in Scarborough are, thankfully, all about protecting the environment, as we move to net zero and tackle the climate crisis.

Local business SeaGrown has created the Kelpedo, which is an innovative and robust offshore seaweed cultivation system. The small cylinder is literally fired from boats into the sea like a mini-torpedo. More than just a structure for growing seaweed, each Kelpedo unit actively contributes to ocean health by sequestering carbon, improving water quality and creating vital habitats that enhance marine biodiversity. It can be scaled up to be used in offshore wind farms, and shows how new employment opportunities and local identities can be created beyond conventional maritime activities.

The move to net zero also inspires Alexander Dennis Ltd, formerly Plaxton—manufacturers of fine electric buses and a major employer in Scarborough—and in September, Schneider Electric opened up a brand-new, £42 million, state-of-the-art smart plant that produces the critical electrical equipment needed as the UK moves to cleaner energy. I have visited that incredible new facility in Eastfield, which makes the low-voltage switchgear needed to manage and distribute incoming power supplies into separate circuits, such as the feeder pillars for electric vehicle charging. The plain green box behind the whizzy plug-in will probably have been made in Scarborough. The facility is net zero in scope 1 and 2 emissions, and it uses modern technologies to reduce energy waste and maximise the use of renewable energy, 30% of which will come from its own solar energy system.

By manufacturing in the UK for UK organisations, our investment builds resilience into the nation’s critical infrastructure, reducing exposure to global supply chain shocks and slashing both cost and carbon emissions through shorter, optimised transport and logistic routes. UK production means faster and more flexible delivery of bespoke engineering solutions, tailored to the unique needs of UK projects. Customers can visit the Scarborough site and collaborate directly with product designers and engineers to ensure that products fully meet their needs before they move into production. Companies like Schneider and Alexander Dennis are looking to us for joined-up policy and a stable regulatory environment, as well as a Government commitment to electrification, transport decarbonisation and buying British through procurement incentives.

Advanced manufacturing employs nearly 50,000 people across Yorkshire and the Humber, contributing £6.2 billion to the country’s economic output. I am proud to represent a coastal constituency where innovation and excellence in specialist manufacturing proudly plays such a major part in addressing the climate emergency and in our regional success story.

10:12

[Gideon Amos (Taunton and Wellington) (LD)]

It is a pleasure to serve with you in the Chair, Mrs Harris. I congratulate the hon. Member for Calder Valley (Josh Fenton-Glynn) on shining light on a really important part of our economy, both locally and nationally.

Specialist manufacturing is critical to my Taunton and Wellington constituency, as well as to growth across the United Kingdom. I could talk about a range of companies, including Pearsalls, which is part of the Corza Medical group and has been spinning its looms in the same building since the 18th century. Today, it is the world leader in manufacturing sutures and surgical stitching materials, which it ships around the world.

My hon. Friend the Member for Tiverton and Minehead (Rachel Gilmour) mentioned the Agratas factory that is being constructed just across the border from my Taunton and Wellington constituency. As she said, it will employ around 4,000 people and have a huge impact on not only our two constituencies but the whole south-west economy. Many of my constituents work there already, and many local suppliers will be involved in the supply chain, so the regional economy will be greatly affected in a positive way. That is what specialist manufacturing can do for regional economies, but only if we get the skills right.

The University Centre Somerset College Group, which is based not only in my Taunton and Wellington constituency but across Somerset, is the largest college provider of apprenticeships in England. It has partnered with Agratas to develop new training pathways, including apprenticeships for upskilling and reskilling, to deliver the skills the new facility needs. It is not just another training programme: UCS has to develop a first-of-its-kind programme to meet the demand, which barely existed just a couple of years ago. It is not an easy task, but it is exactly the kind of innovation required to build a skills base that can support the new specialist manufacturing sectors we need, such as battery production.

UCS has done all that at its own risk, and without Government support. It is developing a curriculum and hiring specialist trainers in a completely new industry, with a lack of up-front funding. It will receive funding from the Government or other sources only once the course starts. As a further education college, it cannot borrow against potential future funding. The current FE model does not support the up-front investment that is required, and specialist skills will suffer as a result. Such investment is desperately needed and the current system has to change.

There is another way in which UCS skills investment is being held back. Colleges are no longer allowed to borrow in order to invest in the student accommodation they need as they used to be able to. The community of Taunton and Wellington, as well as the college itself, desperately want to see such investment. However, the college cannot facilitate that, because it is no longer allowed to borrow to invest. We cannot expect colleges to shoulder all the risk of these initiatives while the Government take the credit for positive outcomes without having supported them in the first place.

This issue is not just about specialist manufacturing skills; sites such as the Agratas site require an enormous amount of construction skills and labour. During peak construction years, the construction of the site will generate a total of £540 million for the region. If we are serious about boosting regional growth through specialist manufacturing, we need to be equally serious about training the people who will build such facilities and work in them. Agratas shows what is possible. The investment appetite is there. Battery manufacturing could be a brilliant new green growth opportunity for the UK. However, we need the Government to match that ambition with support for skills in both specialist manufacturing and construction. That means properly funding institutions such as UCS and ensuring that Skills England invests up front in these partnerships that deliver, rather than just producing consultation papers that plan.

For Taunton and Wellington, and indeed for the south-west as a whole, the opportunity is in front of us. The Government need to grab it with both hands and provide the support and the certainty to turn it into a success.

10:16

[David Williams (Stoke-on-Trent North) (Lab)]

It is a pleasure to serve under your chairmanship, Mrs Harris. I congratulate my hon. Friend the Member for Calder Valley (Josh Fenton-Glynn) on securing this important debate.

In discussing the contribution of specialist manufacturing to regional economies, there is no better example than the city that I am so proud to represent. Indeed, we have a bit of a pincer movement going on today, because all the MPs from Stoke-on-Trent are in Westminster Hall today. That speaks to the importance of our ceramics industry, whether it is traditional or advanced. That industry is personal to me, because my mum and my grandad worked in it; they would rightly expect me to be here for the debate.

As we know, Stoke-on-Trent was moulded by ceramics, and ceramics remains one of the UK’s most distinctive specialist manufacturing clusters. It is an industry built on technical skill, precision and an understanding of materials that has been passed down from family to family for hundreds of years.

When Moorcroft closed its doors earlier this year, I met its incredible workers who, between them, had over 800 years of experience in the ceramics sector. That is not some abstract figure but lived experience of firing temperatures, glaze chemistry—dipping, as we call it—moulding techniques and quality control. Those skills cannot simply be recreated once they are lost. I am delighted that Moorcroft now has a new lease of life. It has reopened under the stewardship of Will Moorcroft, the grandson of the company’s founder, which is great news for the city.

The reality of specialist manufacturing is that it is place-based. We have heard about the importance of identity. It crosses generations, and it has an economic and cultural value that goes far beyond any set of accounts. Across Stoke-on-Trent, ceramics companies continue to innovate. They support supply chains that reach into retail, hospitality, construction and advanced industries. They offer skilled employment and apprenticeships for our local people, anchoring our local economy, yet, as we know, the sector faces some real difficulties at the moment: rising energy costs, international competition from countries that do not have the same regulatory or cost environments, and an older workforce that needs a pipeline of new talent. If the Government are serious about backing specialist manufacturing, clusters such as ceramics must be treated as a strategic national asset that is worthy of receiving targeted support on energy, skills, exports and fair competition.

We all know that Stoke-on-Trent stands ready to play its full part in the UK’s industrial future, but we cannot afford to lose our skills and our manufacturers, which the generations before us built up. I hope that the Minister will set out clearly today how the Government plan to protect and grow specialist manufacturing sectors such as our ceramics sector, which remain essential to regional economies and to the country as a whole.

10:19

[Harpreet Uppal (Huddersfield) (Lab)]

It is a pleasure to serve under your chairship, Mrs Harris. I thank my hon. Friend and constituency neighbour the Member for Calder Valley (Josh Fenton-Glynn) for securing the debate. We have some Yorkshire people here today.

Our manufacturing towns and communities have long been the engine rooms of this country. They built our economy, drove innovation and gave generations of working-class families good, secure jobs and pride in their local identity. From textiles and engineering to precision manufacturing, these industries shaped the story of our country.

In my constituency of Huddersfield, that story runs deep. The town’s industrial heritage is woven into its very fabric—literally, as Huddersfield’s rich textile history dates back to the early 1700s. Since establishing a worldwide reputation for the manufacturing of fine woollen and worsted cloth, the words “Made in Huddersfield” have been a highly revered global brand. Merchants travelled from across the world to buy Huddersfield cloth, and generations of local workers powered an industry known for exceptional craftsmanship, precision and skill. I have seen at first hand the skill and dedication needed to work in these industries, as my dad worked as a weaver for over 30 years at a local textile firm, C & J Antich & Sons. It makes the cloth for the best fashion houses in the world, as well as putting together materials for Formula 1 cars, which is very exciting.

The truth is that manufacturing matters to Huddersfield, and it matters that we make things in our country. Since becoming the MP for Huddersfield, I have had the opportunity to meet and visit many incredible family-owned and locally born manufacturers working in Huddersfield. That includes W. T. Johnson & Sons, a fourth-generation family-run textile finishing firm that has operated in Huddersfield since 1910; David Brown, a defence manufacturer providing highly complex equipment to the defence industry; the Textile Centre of Excellence, which provides training and research; Thomas Broadbent & Sons, which has run its company in Huddersfield since 1864; Olympus Technologies, which has been designing robotic solutions since the 1980s; Camira Yarns, a woollen spun yarn specialist that was founded in Huddersfield in the 1860s; and Reliance Precision, which has been around for 60 years and does some highly technical stuff that I do not fully understand, but it is very exciting. I also recently attended a roundtable hosted by the Calderdale and Kirklees Manufacturing Alliance.

On those visits, manufacturers and industry leaders often told me the same story. They want to grow, innovate and recruit locally, but there is an issue with finding a younger workforce, so continued investment in vocational training and partnerships between industry and education is really important. Energy costs continue to be a concern, and they want to make sure manufacturing —not just advanced manufacturing—is a strategic priority for this Government. We must invest in the businesses that make things here in Britain.

The ongoing impact of Brexit on trade and the supply chain is a concern for some businesses. SMEs particularly need support with cyber-security. Could the Minister explain what support is available to them? There was also some positive feedback on the export growth programme, which provides tailored advice to industry, and businesses asked what we can do to make sure that model goes further.

These businesses are not nostalgic for the past; they are building for the future. The challenge and the opportunity is to make sure that the benefits of that innovation reach the people and places who need them most. Skills and workforce development will be particularly important for that. Without long-term funding for skills, the system will continue to fall short of what both learners and employers need. If we invest in people, prioritise skills and provide stability for the specialist industries that underpin our economy, we can restore pride and prosperity to the regions that built this country. That means creating secure, high-quality jobs. It means keeping our young people in the towns where we grew up, and it means ensuring that the next generation can take pride in the industries that define their communities.

[Carolyn Harris (in the Chair)]

I call the Liberal Democrat spokesperson.

10:24

[Mr Joshua Reynolds (Maidenhead) (LD)]

It is a pleasure to serve under your chairmanship, Mrs Harris. I congratulate the hon. Member for Calder Valley (Josh Fenton-Glynn) on securing the debate. When I woke up on this cold Wednesday morning, I did not think I would learn so much about the manufacturing in all our regions—and when there are so many Members from Stoke-on-Trent in the Chamber, how could we not learn so much about ceramics?

Specialist manufacturers do not operate in a vacuum; they need certainty to make investment decisions spanning years—often decades—and they need to know that the Government understand their sector and will back it for the long term. I welcome the fact that the Government have listened to British business and reinstated the industrial strategy, and I am pleased to see it focusing on many of the same sectors that the Liberal Democrats have prioritised for so long: life sciences, clean energy, professional business services, aerospace and automotive.

Obviously, the background to that is disappointment from the previous Government’s decision to scrap the industrial strategy in 2021, pulling the rug out from under businesses that had planned on the basis of Government commitments. However, I am disappointed that not enough attention has been paid to the agrifoods industry and the rural economy.

Agricultural technology was one of the 11 priority sectors that Liberal Democrats identified in our industrial strategy. Recognising and supporting that sector will help make food healthier, safer and more affordable. Agrifood tech is not a niche industry; it is about applying the same precision engineering we have for aerospace and pharmaceuticals to the sector that feeds our nation. It is disappointing that the Government have relegated it to a handful of mentions in the White Paper.

We cannot have this debate without discussing the issue that keeps specialist manufacturers awake at night: energy costs. Many other Members mentioned that we have some of the highest industrial energy prices in the world, and measures to bring them down will always be welcome news. When Nissan tells us that its Sunderland plant has the highest electricity cost of any of its plants worldwide, Britain’s competitiveness is obviously going to become an issue. That lack of competitiveness will harm our regional economies in the future.

Britain’s businesses are not only struggling in this sector. When it comes to regional economies and these specialist manufacturers, they do not just rely on affordable power for themselves and their factory floors; they also need it for the companies that supply them, such as local services and the businesses that form the ecosystem to allow them to be viable. It is also important for the hospitality sector and small and medium-sized enterprises, so the Government need to do more to ensure that small businesses across all those sectors have access to better energy deals. There cannot be a thriving specialist manufacturing area when broad business in the region is struggling.

Manufacturing is reliant on skills, and specialist manufacturing sites cannot be run without people with deep technical knowledge. When I speak to businesses across the country, they tell me that after energy bills and tax, skills comes out as their most pressing issue. Multinationals have the choice of where they put their facilities across the world, so we need to ensure that they are in Britain. That means that we need the talent pipeline, and not just the talent density, to ensure that that we are at the front of manufacturing in the future. The Liberal Democrats have set out a comprehensive approach to reforming skills that includes replacing the broken apprenticeship levy with broader flexibility in the skills training levy, guaranteed apprenticeships paid at least at the national minimum wage and lifelong skills grants so that adults can learn to use new technologies as they evolve.

I will briefly touch on two areas where specialist manufacturers are facing significant challenge, the first being trade. These are international sectors, and if the Government are serious about backing British business, they must show more ambition on trade with Europe. We would do that by negotiating a new UK-EU customs union, because our specialist manufacturers face red tape and friction when they trade with our largest and closest market neighbours. That makes them less competitive and increases costs. Secondly, there is the national insurance contributions—the jobs hike. The Government must scrap that damaging measure, because making it more expensive to employ people is counterproductive.

I conclude by pressing the Minister to work cross party to ensure that we get a fix for those issues and asking him about national exporting. We are hearing concerning news from the Department for Business and Trade about its plans to reduce its international export team by between 27% and 38%, and in particular reports about cuts to the Latin America trade support team of up to 54%. I would appreciate the Minister’s views on that, as that is an area we must focus on to ensure that Britain is competitive and is exporting. Given that we must support our small businesses to export, those reductions cannot be correct.

10:29

[Rebecca Paul (Reigate) (Con)]

It is a pleasure to serve under your chairmanship, Mrs Harris. I congratulate the hon. Member for Calder Valley (Josh Fenton-Glynn) on securing this critical debate, which is very timely, given the forthcoming Budget. I acknowledge the very pertinent point that he made about the importance of apprenticeships for the specialist sector more broadly.

The specialist manufacturing sector is one of those quiet national assets that rarely make front-page news but keep our economy alive. Its contribution to the UK is not abstract but is counted in highly skilled jobs, export strength and clusters of high-value industry. According to the latest figures, advanced manufacturing now accounts for more than 900,000 jobs across the UK and contributes more than £90 billion in gross value added to the economy. I am pleased that the Government’s industrial strategy recognises the reality of advanced manufacturing’s value, which is spread across the country. I welcome the emphasis that they are placing on specialist manufacturing, as it is clear that the industry offers Britain a comparative advantage in our trade with the rest of the world.

The sector gives our communities certainty. I see that in my constituency, where we host a range of high-value specialist manufacturers whose work speaks directly to the issues raised in this debate. One such firm is Respirex International, a world-leading manufacturer of chemical, biological, radiological and nuclear protective equipment, including gas-tight suits, respirators and chemically protective boots. Its products are not only exported worldwide, but used by emergency services and pharmaceutical and nuclear facilities across the UK, protecting lives in some of the most hazardous environments imaginable.

We are also home to Risbridger Ltd, established in 1922—an engineering company producing advanced components for aircraft servicing and petrochemical infrastructure. It contributes directly to aerospace and energy supply chains. That is exactly the kind of innovative, precision-focused industrial capability that we should champion as part of Britain’s economic future.

In Reigate and across our country, specialist manufacturing has always pulled in long-term capital because it deals in long-term capability. In 2025, the sector counted some 2,700 active companies, and the Government aim to increase annual business investment from £21 billion to £39 billion by 2035. That ambition matters, because regions such as the north-west already generate £14.4 billion in advanced manufacturing GVA. The west midlands generates £11.8 billion and the south-west generates £10.4 billion. Those are not marginal numbers; they are proof that British engineering remains globally competitive when it is backed properly.

Defence manufacturing is a genuine force multiplier. The Ministry of Defence estimates that the sector supports 200,000 jobs, with 70% of spending flowing to areas outside London and the south-east. Indeed, aerospace and defence manufacturing are particularly strong drivers of regional growth. Employment in the advanced manufacturing sector in Northern Ireland has grown more than four times faster than the UK average, while areas such as north Wales remain world renowned for aeroplane wing production. In Glasgow, specialist shipbuilding and satellite technology lead the charge.

Woven together in often complex supply chains, the specialist manufacturing sector demonstrates how fragile business ecosystems can be and why they need the Government’s support. But I must say, with deep regret, that the sector has received nothing of the kind, despite the Government’s lengthy blueprint earlier this year, which rightly identified eight key sectors as strategic priorities: advanced materials, agritech, aerospace, automotive, batteries, space, defence and maritime capabilities. But of course a strategy is only as good as its implementation, and manufacturers are seeing not policy support but punitive tax hikes, cost pressure and legislative risk.

As the hon. Member for Calder Valley and many others said, it would be fantastic if we used more British parts in the UK, but we do not because of the cost. To address that, we must bring energy prices and tax down; warm words in this Chamber will not do it. Since their very first Budget, the Government have inflicted a barrage of attacks on manufacturing businesses. The spiralling uncertainty pouring out under the door of No. 11 is damaging the confidence of every business, but especially the specialist manufacturing sector, and the warning lights are flashing.

Make UK reports that manufacturers’ operating costs have risen sharply, driven by energy prices, the Chancellor’s job tax and uncertainty around business taxation: 68% said that costs rose faster than expected, and more than half froze recruitment as a result. If specialist manufacturers are to keep delivering regional growth, energy competitiveness and a stable tax policy are not luxuries; they are prerequisites.

Let us consider the UK’s industrial electricity prices, which are now estimated to be 40% to 50% higher than the International Energy Agency median for comparable industrial nations. Make UK has gone as far as to call energy costs an “existential threat” to many specialist firms. The consequences are already here. UK steel and chemicals output has dropped 35% compared with 2021 levels, while imports of those same materials are rising. Just yesterday, we heard that ExxonMobil is closing its plastics refinery in Mossmorran. Four hundred jobs are now at risk because of what the company called the

“current economic and policy environment”.

I am confident that in a moment the Minister will rise to spin away any criticism, but this is indefensible.

The reality is that no Government that are serious about the future of advanced manufacturing in Britain would have imposed a jobs tax and changes to national insurance thresholds that hurt hardest those who employ the most. No Government who care about British advanced manufacturing firms and British workers would ignore energy costs that are four times higher than those of our competitors. No Government who believe in the future of our advanced manufacturing industry would introduce a 330-page unemployment rights Bill with job-destroying, hiring-freezing measures from cover to cover. No Prime Minister who wants to kick-start economic growth would look advanced manufacturing business in the eye and say that he has a done deal with the United States and then leave the industry in the dark as tariffs on items such as pharmaceuticals remain for months afterwards. And no Government who say they want to build skills would abolish level 7 apprenticeships.

Just as night follows day, the Government will talk big on business, but their actions show that much of it is merely empty rhetoric. Our specialist manufacturing sector deserves better; it deserves a Government who stand with them, and leadership that understands that when specialist manufacturing succeeds, Britain succeeds. We have in this country the expertise, the heritage and the industrial DNA to compete and excel, but the specialist manufacturing sector will not survive on pride alone. It needs certainty, cost stability and a Government who truly get what it means to make things. We urgently need to reclaim our status as the nation that builds, and the best way to start is by listening to those firms that still do so.

10:37

[The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)]

It is a pleasure to serve under your chairmanship, Dame Carolyn. I thank my hon. Friend the Member for Calder Valley (Josh Fenton-Glynn) for securing this debate, and for his opening remarks.

Hon. Members may have thought, when they heard that Stoke-on-Trent had been “moulded by ceramics”, that it was the worst joke they would hear in the Chamber today, but I will try my best. When I heard my hon. Friend refer to valve valley, I wondered, as a cornet player, whether it was a reference to the famous West Riding brass bands: the Brighouse and Rastrick brass band, the Elland Silver band and my personal favourite, the Friendly band of Sowerby Bridge. I am sure that they use their cornet valves to lower or raise the tone just as effectively as we did in this debate. Cornet valves, of course, respond well under pressure—I shall see how I do with that.

Maybe, after this debate, the particular expertise of the valve industry in Calder Valley will be better known to the country. It is not difficult to see the impact that manufacturing, and the valve industry in particular, has on Calder Valley. I have seen, as I am sure those watching will have, the pride and importance that hon. Members across this House recognise in the manufacturing industries in their particular areas. These companies are the heart of British manufacturing.

In the valve industry, we have companies such as Hopkinsons, established in Huddersfield in 1843, which continues, as part of Trillium Flow Technologies, to export valves globally. Its valves are used in applications ranging from boilers to power plants, in oil and gas, and in petrochemicals. In Fort Vale, founded in Calder Valley, we have a global manufacturing presence making valves for transportable tanks. Last year, Fort Vale received its fifth King’s award—formerly the Queen’s award—for international trade. Blackhall Engineering is another astonishing story of a link between our Victorian heritage and modern engineering. It supplies valves for the New York City water board, replacing originals installed by its predecessor company a century earlier.

We need to recognise the local pride in Calder Valley, and in all parts of the country with a strong manufacturing heritage, and recognise the economic opportunity of wages and real value that manufacturing brings to these communities. But there are, of course, significant challenges, including those that hon. Members raised in this debate. I wish to address the challenges in procurement, skills and energy costs, as well as the challenges that have been mentioned for small businesses.

The framework through which the Government are working with industry and manufacturing is, of course, our industrial strategy, which attempts to respond to those challenges and to deliver productivity and growth, and is unashamedly place-based in the regions that matter to manufacturing. Some 84% of manufacturing jobs are located outside London and the south-east. I want to mildly disagree here with my hon. Friend the Member for Stoke-on-Trent South (Dr Gardner), because she mentioned deindustrialisation—a word that I do not particularly like to use in this sense. The UK is very much an industrial country; we have just chosen to locate our industry elsewhere, and part of my mission is to ensure that we regrow and restore that manufacturing here in the UK. I know that she would agree with that.

The hon. Member for Taunton and Wellington (Gideon Amos) spoke of regional growth, which is also vital. Our industrial strategy is about securing competitiveness not only for sectors, but for regional prosperity, and we recognise that manufacturing is key to the resilience of our national economy.

[Gareth Snell]

A lot of Members have talked about the importance of defence manufacturing; the Minister has talked about our economic resilience, but a big part of this is our sovereign capability and our national security resilience. I know that he has done work on that, so can he say more about how his work aligns with the work of the Ministry of Defence team to ensure that the manufacturing capability in the UK is about not just economic growth, but our national security and safety?

[Chris McDonald]

That point is well made. Of course, alongside our industrial strategy, we have our defence industrial strategy. When I come to talk about procurement, I may say more about that, and many hon. Members have talked about defence.

When we talk about our manufacturing sector, it is important to highlight some of the headline statistics. Manufacturing pays higher wages and has generally higher productivity in the areas where it is located and, when it comes to the balance of trade, although around 10% of our employment is in manufacturing, it accounts for around 50% of our exports. Those outputs, jobs and exports consist of thousands of specialist manufacturers, large and small, up and down the whole United Kingdom. Those exports are global and, as we have heard, we also export into space.

On procurement—I know that this area has been a major concern for many hon. Members, and particularly Government procurement—I have great sympathy for the comments of my hon. Friend the Member for Stoke-on-Trent Central (Gareth Snell), and I am happy to pursue the specific issues that he raised. I see it as vital to our manufacturing and industrial sectors that we ensure that the money that we as a Government, or our regulated sectors, spend is significant and is concentrated as effectively as possible in the UK, for both its economic and its social value. We need to raise awareness of the opportunities. We must ensure that those opportunities are open to UK manufacturers and that our UK companies are competitive enough to win those contracts. The industrial strategy plays a part in ensuring that those companies can do that.

To increase business investment, we must also ensure that we have a real market opportunity, both at home and overseas. Our clean energy strategy is introducing measures aimed at directly increasing UK beneficiaries in Government procurement. The clean industry bonus for offshore wind, for instance, is designed to encourage investment in Britain’s coastal industrial areas and supply chains. We also want to see robust local content targets. We are examining market demand guarantees to encourage UK scale-ups and introducing a clean energy supply chain fund to support UK-based clean energy manufacturing.

The defence industrial strategy, which I mentioned earlier—the defence industry is, of course, another user of valves—sets out a major reform agenda for procurement to grow our UK industrial base. We will be speeding up procurement processes and reducing bureaucracy, while ensuring greater visibility of defence procurement and taking steps to ensure that small and medium-sized enterprises will have greater access to our supply chains. Our procurement and capital programmes are key to anchoring manufacturing here in the UK and then encouraging businesses to secure investment and export overseas.

UK manufacturing, however, ranks just 24th globally for robotics and automation. Here I move to the topic of productivity, which is of course a key element in profitability and competitiveness. That is an area where, as a nation, we need to work more. If we are not working digitally, we cannot adopt automation and move as fast as our competitors. Our Made Smarter adoption programme, with up to £99 million of additional funding, will help with this. It will support more manufacturing SMEs to take up new technologies and improve their digital capabilities. We have had reference today to the High Value Manufacturing Catapult, which I know from personal experience is a great supporter of improving competitiveness, robotics, automation and productivity in our supply chains.

Skills was also an important feature of today’s debate. They were raised by my hon. Friend the Member for Calder Valley, with his inspiring story of Stuart Billingham —maybe we all need to see more Stuart Billinghams in our lives. The hon. Member for East Londonderry (Mr Campbell) also mentioned regional skills development. I know that persistent skills shortages and the availability of good applicants are a concern felt across our manufacturing sectors. That is certainly an area for Government and industry to work closely together on, to encourage talented people from across the UK to seek jobs in our manufacturing sector. Fort Vale in Calderdale has a strong tradition in apprenticeships, and I understand that it receives over 140 applications each year for the opportunities it provides. That experience of high numbers of applications for apprenticeships is something I see across the country. I applaud the work of the West Yorkshire Manufacturing Services charity and its partnership with Calderdale college on the Industry 4.0 hub, which addresses exactly those digital issues.

[Rebecca Smith]

I mentioned skills as a significant challenge in the defence sector and the additional manufacturing. We have five defence technical excellence colleges opening by the end of next year. How well connected is the Minister’s Department with the Department for Education? Does he have any knowledge of when those colleges will be announced? They are surely a key part of what the Government hope to achieve with defence skills, but they will also be important for regions such as the south-west.

[Chris McDonald]

I welcome those comments. The hon. Member is right to point out that skills is a cross-Government exercise, and that applies not only to defence skills colleges. Work is done across the two Departments I work in—the Department for Business and Trade and the Department for Energy Security and Net Zero—and skills itself resides in the Department for Work and Pensions, which is where it is co-ordinated. Moving skills into that area and having the co-ordination there is exactly right. I also meet Defence Ministers to discuss this issue; many of these skills are transferable across industries, and we want to ensure that people can transfer across from different industries. A couple of weeks ago I launched the clean energy jobs plan, which provides support for people to move out of the oil and gas sector, for instance, and into clean energy industries. I thank the hon. Member for raising that issue.

Our focus on skills includes a new engineering skills package, worth over £182 million, to fund technical excellence colleges in advanced manufacturing. More widely, through the post-16 education and skills strategy, we are introducing wider reforms, including new foundation apprenticeships for young people in target sectors. Our new V-levels will encourage young learners into vocational pathways, and I am sure that hon. Members will have heard the personal priority the Prime Minister placed on this during his speech at the Labour party conference.

Attracting young people into manufacturing is clearly a priority for the sector, and our advanced manufacturing sector plan sets out ways in which we can do that. Wages in the sector are 8% higher than the UK average, which can provide great opportunities for young people. We heard earlier that welders earn even more than that—something that my nephew, who is a welder, also tells me. My welding is terrible, so I was absolutely unable to pursue that as a career. We are also concerned about equalities, and we have a target of 35% representation of women in the sector by 2035.

Young people also value their employment rights, and I should say to the hon. Member for South West Devon (Rebecca Smith) that before I came to this place I ran a small business that had almost all of those employment rights. I understand that small business owners might be concerned, but I can assure them that it is perfectly—[Interruption.]

[Carolyn Harris (in the Chair)]

Order. If the hon. Member for Bognor Regis and Littlehampton (Alison Griffiths) wishes to speak, I suggest that she ask for an intervention.

[Chris McDonald]

Small business owners might be concerned, but I know from personal experience that with the right level of support, it is perfectly possible to manage a business with these employment rights. I suggest support, rather than scaremongering, is the way to go. We heard from the hon. Member for Tiverton and Minehead (Rachel Gilmour) about the support a previous local industrialist gave to their community. Although I commend that, Labour Members think that good pay and conditions are a right rather than a gift.

Energy costs are clearly the major competitiveness issue for industry. I agree with the shadow spokesperson, the hon. Member for Reigate (Rebecca Paul), about the lack of competitiveness of UK energy costs—she cited a figure from the International Energy Agency showing they were 46% above European averages, and that is a figure I recognise. However, our clean power mission will ensure that we are weaned off the international gas markets, to which we were enslaved by the previous Government for such a long time. The shadow Minister mentioned Mossmorran, which is a good example of a business that sustained losses for years and was unable to justify investment as a result of the previous Government’s neglect of manufacturing and industry.

We recognise that, beyond our clean power mission, we must do more and act quickly to support sectors with high growth potential and significant exposure to high electricity costs. We are increasing the support available for energy-intensive companies through the British industry supercharger, and from 2027 we will introduce the new British industrial competitiveness scheme, which will reduce electricity costs.

[Gareth Snell]

I make my regular plea to the Minister to consider extending the supercharger scheme to energy-intensive industries that are not currently covered, ahead of the introduction of the British industrial competitiveness scheme.

[Chris McDonald]

I would have been disappointed had I mentioned the supercharger from the Dispatch Box and my hon. Friend did not intervene—I shall write that into my speeches from now on. His point is well made and is heard by me. A consultation on the British industrial competitiveness scheme will open shortly. I encourage the valve manufacturing industry of Calder Valley to participate in the scheme, and all Members to publicise the scheme to small businesses in their areas.

Hon. Members did not particularly mention regulation, but I want to raise it. Of course, £1 off the costs of regulation is worth £1 off any other business cost. A lack of new funding or of access to finance or working capital can be a reason that businesses fail to grow. Small companies tell me that financial institutions often do not understand their businesses or the need for more patient returns. We are undertaking a programme with the British Business Bank to make available £4 billion for our industrial strategy growth capital in industrial strategy sectors, and the Office for Investment will focus on high-value investments, leveraging the National Wealth Fund’s £27.8 billion for industrial strategy sectors.

Although we hear very strong voices regarding international alignment on products and standards, we also hear about the complexity of business regulation and its impact on smaller businesses. We have set out an ambition to cut the administrative costs of regulation for business by 25%. I am pleased to say that we have released a business questionnaire seeking views on the impact of regulation on businesses. Again, I ask for help from hon. Members in encouraging all manufacturers in their areas to consider closely which regulations are enabling or hindering growth, and where compliance is creating an undue burden.

[Jim Shannon]

I hope the Minister will forgive me if he is going to address my earlier request, which related to the Northern Ireland Assembly Minister back home. I know that he travels to Northern Ireland and has an interest in Northern Ireland, and it is important that we work together. Will he give the commitment I mentioned?

[Chris McDonald]

I did hear the hon. Gentleman say that earlier, and he is right that I have a strong interest in Northern Ireland and a great deal of respect for our advanced manufacturing there. I look forward to visiting the aerospace and shipbuilding industry there soon—I think it will be early in the new year—and I am absolutely committed to working with Northern Irish MPs and the local authorities to ensure that the manufacturing industry in Northern Ireland thrives.

Our plan for small and medium-sized businesses, published this year, includes a number of additional measures aimed at assisting those businesses, including ending late payments, modernising the tax system, establishing the new business growth service, and considering how we can best support exporting businesses to increase their exporting activity.

[Mr Joshua Reynolds]

The Minister talks about SME exporting. Is he aware that, although UK Export Finance has unveiled what it believes is a fantastic and ambitious plan to support 1,000 SME exporters a year by 2029, there are 314,000 SME exporters in the UK at the moment? I would not have thought that 1,000 a year out of 314,000 is very ambitious.

[Chris McDonald]

The hon. Gentleman is right that UK Export Finance’s plan is to encourage an additional 1,000 businesses, but that is not the limit of our ambition with regard to SME exporting. It is important that we increase not only the number of SMEs that are exporting but, as I said earlier, the competitiveness of SMEs, so that they can increase the percentage of their exports. The work we are doing on UK procurement will also help with that by giving a baseload of orders to UK businesses that will then increase their competitiveness and enable them to win more export orders.

[Dr Gardner]

In 1882, a ceramics company in my constituency exported 50% of its products to Europe and globally. Since Brexit its ability to export to Europe has dramatically reduced. It can export to the US in two days, but it can take months to get its exports to Italy. What can the Minister do to help us improve our trade to Europe?

[Chris McDonald]

This comes back exactly to my point about regulation. Through our work with the EU, we are endeavouring to ensure that we have maximum access to the market. Where regulatory burdens are restricting export activity, I am keen to hear about them. I encourage businesses to come forward and support the questionnaire we have released on business regulation.

The industrial strategy places an emphasis on growth and frontier industries, but it also gives a clear focus to city regions and clusters with the highest potential to support our growth sectors. It is important to us that we grow the manufacturing sector across the country and also businesses, small and large, in supply chains, as well as well-known household names. I reaffirm that the Government have an ongoing commitment to UK manufacturing. We can too easily think about manufacturing as being about household names and consumer products, but we have heard a lot today about manufacturing businesses in the supply chain that employ many more people and make a significant economic contribution, over and above the consumer products we can buy.

As I know myself, manufacturing is about local businesses that have an impact locally on communities and prosperity, as well as on the growth of the country. The Government have a high ambition for our manufacturing industry. By 2035, we want to be the best place in the world to start, grow and invest in advanced manufacturing. We want to double the annual business investment entering the UK manufacturing sector from £21 billion a year to nearly £40 billion a year. That requires bold action, and in many of the measures I have set out we are looking to do more. The steps we have taken in setting out the industrial strategy and various sector plans this year, and the reforms we are making to skills, finance, innovation and regulation, will have a positive and lasting impact, not only for valve manufacturers in Calder Valley but for other specialist manufacturers around the UK.

[Carolyn Harris (in the Chair)]

I thank the Minister for my elevation to Dame—it has a certain ring to it. I call Josh Fenton-Glynn to wind up the debate briefly.

10:57

[Josh Fenton-Glynn]

I thank all Members for the tour we had of the UK, with a particular focus on Stoke-on-Trent. My hon. Friend the Member for Stoke-on-Trent South (Dr Gardner) talked about specialist ceramics, my hon. Friend the Member for Stoke-on-Trent Central (Gareth Snell) talked about Bakewell tarts and the saucers on which they are placed, and my hon. Friend the Member for Stoke-on-Trent North (David Williams) talked about the clusters that really make a difference. We heard from my hon. Friend the Member for Huddersfield (Harpreet Uppal) about textiles, and from the hon. Member for Strangford (Jim Shannon) about the huge role Northern Ireland plays. We heard from my hon. Friend the Member for Scarborough and Whitby (Alison Hume) about things produced there that go to the bottom of the sea, and from the hon. Member for Tiverton and Minehead (Rachel Gilmour) about products that go into space. All of that leads us to understand the pride that people have when they produce things—when they make something in a factory in a town in the UK and it can go anywhere. That is why our manufacturing services are so important and why we need to make sure that we get the absolute most out of them.

I will resist talking more about brass bands, although the Minister tempted me to do so, but I will take him up on what he said about wanting to understand more about the valve industry. He is welcome to visit me in Calder Valley so that I can show him some of the things we do better than anywhere else in the world.

Question put and agreed to.

Resolved,

That this House has considered the contribution of the specialist manufacturing sector to regional economies.