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

To ask Her Majesty's Government what plans, if any, they have to encourage businesses to manufacture goods and components and source supplies in the UK.

The UK’s manufacturing sector plays a vital role in the UK economy by driving innovation, exports, job creation, and productivity. The Government is taking steps to help drive increased competitiveness in UK manufacturing to anchor investment and production. This includes:

• Increasing the Annual Investment Allowance to £1 million until the end of this year. This will help manufacturers make the investments in capital equipment that can support their increased competitiveness.
• Investing £26 million over 3 years to support aerospace and automotive supply chains through the National Manufacturing Competitiveness Levels programme.

Through the Industrial Strategy Challenge Fund, we have invested £2.5 billion to drive cutting-edge research and innovation, from world-leading battery design to new light-weight composite materials. We are investing up to £167 million into Made Smarter, the UK’s national industrial digitalisation programme, to boost manufacturing productivity through the development and adoption of cutting-edge digital technology.

Furthermore, the Chancellor announced at the 2020 Budget the UK’s largest and fastest expansion of support for research and development (R&D) across the economy. Spending is set to reach £22 billion by 2024/2025 and businesses will receive an increase in R&D tax credit from 12% to 13%. To ensure this investment in R&D also helps anchor production in the UK, we have invested over £350 million in the High Value Manufacturing Catapult network to support the commercialisation of new manufacturing technologies. We will be investing a further £600 million by the end of 2023.

It is worth noting that in these difficult and unprecedented times, caused by the Coronavirus outbreak, we are focusing all efforts on tackling the pandemic. This includes mitigating its impacts by protecting jobs, so manufacturers can continue to provide essential goods and services.

An unprecedented package of support has been announced for businesses and workers to protect against the economic emergency caused by the Coronavirus.

The Government has made an initial £330 billion of loans and guarantees available, which is equivalent to 15% of UK GDP, to support firms and help them manage cashflows through this period. The Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, went live on 23 March. It will support smaller businesses, including unincorporated businesses such as partnerships and sole traders. Full guidance and eligibility criteria can be found at: www.british-business-bank.co.uk/cbils.