Question to the Department for Business, Energy and Industrial Strategy:

To ask the Secretary of State for Business, Energy and Industrial Strategy, if he will make an assessment of the potential merits of the introduction of additional (a) incentives, (b) capital allowances, and (c) financial support for research and development to support the manufacturing industry.

We are in regular dialogue with companies, business organisations and other stakeholders on how best to support the UK manufacturing sector in a way that delivers value for money for the British taxpayer. Our modern Industrial Strategy will ensure the UK remains one of the most competitive locations in the world for manufacturing investment.

We are investing over £600m in the High Value Manufacturing Catapult and up to £167m in our Made Smarter industrial digitalisation programme. We have increased the permanent level of the Annual Investment Allowance from £200,000 to £1 million for all qualifying investment in plant and machinery made from January 2019 to December 2020 to help stimulate business investment. This will help UK manufacturers develop, adopt and exploit new technologies, and invest in the skills crucial to future success in international markets.

We are making unprecedented increases in R&D and are aiming for 2.4% of GDP to be spent on R&D by 2027 to make the UK the world’s most innovative economy. We have made significant investment into scientific research and development in the manufacturing sector through Waves 1 and 2 of the Industrial Strategy Challenge Fund (ISCF). Some examples of this include: £246m under the Faraday Challenge that helps UK businesses to seize the opportunities presented by the transition to a low carbon economy; £188m for medicines manufacture to develop first-of-a-kind technologies; and £26m for the manufacturing of future materials for advanced manufacturing sectors.

In the most recent Budget, we also announced up to £121m under the Manufacturing Made Smarter Challenge to support the transformation of manufacturing through digitally-enabled technologies, subject to business case approval, and industry co-investment.

Finally, Government and industry have committed around £1 billion through the Advanced Propulsion Centre, to research, develop and commercialise the next generation of low carbon technologies through the period 2013-2023, keeping the UK at the cutting edge of low carbon automotive innovations.