FORGING OUR FUTURE INDUSTRIAL STRATEGY THE STORY SO FAR

1 Industrial Strategy Forging Our Future

2 “ Our challenge as a nation, and my determination as Prime Minister, is not just to lead the world in the fourth industrial revolution, but to ensure that every part of our country powers that success. That is what our modern Industrial Strategy is all about. Investing in science and research to keep us at the forefront of new technologies and the benefits they bring. Nurturing the talent of tomorrow — through more outstanding schools, world-leading universities and the technical skills that will drive our economy. And transforming the places where people live and work — the places where ideas and inspiration are born — by backing businesses and building infrastructure not just in London and the South East but across every part of our country.” Theresa May, Prime Minister

3 Industrial Strategy Forging Our Future

Birmingham University is leading the ReLIB project to recycle electric vehicle battery components

4 Contents

FOREWORD 6

INTRODUCTION 8

INDUSTRIAL STRATEGY AT A GLANCE 10 Industrial Strategy — local to global 11 FOUNDATIONS Ideas 18 People 20 Infrastructure 22 Business Environment 24 Places 26

INDUSTRIAL STRATEGY AROUND THE UK 28

SECTOR DEALS 30

GRAND CHALLENGES AI and Data 40 Ageing Society 42 Future of Mobility 44 Clean Growth 46

REFERENCES 50

5 Industrial Strategy Forging Our Future

6 Foreword

One year after the publication of The UK needs to make the most of our Industrial Strategy, we have the benefits this can bring. This is already seen significant progress. why we set ourselves four Grand Challenges: Artificial Intelligence Over the past year there have been and Data, Clean Growth, the Future important achievements across the of Mobility and Ageing Society. five foundations of productivity set We have already announced four out in the strategy. We now have missions to focus attention on long- record levels of public investment term targets, from five extra year in research and development, of healthy life for all, to halving the matched by sustained growth in energy use of new buildings. private sector spending. We have the fastest wage growth in nearly The Industrial Strategy is more than a a decade and a record number set of policies and commitments. It is of people are now in work. We a new way of working for Government, have had major upgrades to our working across departments to build infrastructure, with the fastest growth long-term partnerships with business, in infrastructure spending in the G7 academia, and local leaders — from and big decisions taken for the nation mission-focused policy-making to our such as the expansion of Heathrow. newly-established Industrial Strategy And we are delivering the biggest Council. It is an ongoing priority, which shakeup to technical education and will adapt as delivery progresses retraining in a generation to make and our needs change. What will sure we have the skills we need. not change is its core objective: to build a Britain fit for the future. We have also struck six Sector Deals, long-term strategic partnerships The Industrial Strategy is designed between government and industry, to secure our success, looking in sectors from construction to beyond our departure from the creative industries. These deals European Union to the future of are not only about attracting the UK and the global economy. investment and growth: they are ensuring we have the skilled, diverse workforce we need for the future. Rt Hon Greg Clark MP Secretary of State for Business, As our Industrial Strategy Energy and Industrial Strategy acknowledges, the way we live continues to be transformed by the technological advances of what is a fourth industrial revolution.

7 Industrial Strategy Forging Our Future

Introduction

Our modern Industrial Strategy is a long-term plan to boost productivity and earning power for people throughout the United Kingdom.

“ The Industrial Strategy is one of the most critical strands of work STRENGTHENING taking place across government. THE FOUNDATIONS It has the potential to raise living We are strengthening the five standards across the whole of foundations of productivity. the UK, boost people’s earning These are the main drivers powers and put the UK at the of a successful economy. forefront of future industries `` Ideas — how we make the UK the internationally. One year from world’s most innovative economy. its original publication, I look `` People — how we build a successful, forward to working with the high-calibre workforce, now and members of the newly-formed in the future, ensuring good jobs Industrial Strategy Council and greater earning power for all. to provide an independent `` Business Environment — how we evaluation of the impact the secure the UK’s position as the best Industrial Strategy is having place to start and grow a business. up and down the country.” `` Infrastructure — how we drive Andy Haldane, Chief Economist improvement to the country’s at the Bank of England and Chair connections, delivering a major of the Industrial Strategy Council upgrade to the UK’s infrastructure.

8 ``Places — how we put our ``Artificial Intelligence and Data: national strategy on a local We will put the UK at the forefront level, creating prosperous of the AI and data revolution. communities across the UK. Our first mission is to use data, BUILDING LONG-TERM artificial intelligence and innovation STRATEGIC PARTNERSHIPS to transform the prevention, early diagnosis and treatment Partnership between the government of chronic diseases by 2030. and industry on sector-specific issues can create significant opportunities ``Clean Growth: We will maximise the to boost productivity, employment, advantages for UK industry from innovation and skills. Sector Deals the global shift to clean growth. call for sectors to set out proposals Our first mission is to at least halve the to transform productivity in their energy use of new buildings by 2030. area. The government then works ``Future of Mobility: We will become with leadership in the sector to a world leader in the way people, ensure that the proposal is robust goods and services move. and transformative, and deals are announced as and when agreements Our first mission is to put the UK are reached on an ongoing basis. at the forefront of the design and manufacturing of zero emission We are working with key UK industries vehicles, with all new cars and vans to agree Sector Deals, with six effectively zero emission by 2040. already published: Life Sciences, Automotive, Creative Industries, AI, ``Ageing Society: We will harness the Nuclear and Construction, and three power of innovation to help meet more due shortly: Aerospace, Rail the needs of an ageing society. and Food & Drink Manufacturing. Our first mission is to ensure people TAKING ON GRAND can enjoy at least five extra healthy CHALLENGES independent years of life by 2035, while narrowing the gap between the We are positioning the UK at the experience of the richest and poorest. forefront of tackling four global Grand Challenges where we can build on our Each Grand Challenge will have strengths and lead the industries of a Business Champion with the future. We have picked specific relevant industry experience, ‘missions’ within the Grand Challenges and missions which are goals — addressing clearly defined problems we can all work towards. by setting an inspiring and stretching As we leave the European Union we goal to focus the efforts of industry, are looking to global opportunities, researchers and government. with policies to sustain and enhance our competitiveness and productivity.

9 IndustrialIndustrial Strategy Strategy Forging Forging Our Our Future Future

The Industrial Strategy is working for the UK economy

£45bn 78,000 already committed smaller UK businesses across the UK through boosted by the British the Industrial Strategy Business Bank

5% 76,000 increase in private sector new jobs created expenditure on research by foreign direct and development1 investment2

£7bn #1 fastest growing record increase in public infrastructure investment spend on research of the seven largest advanced and development3 economies in the world4

10 £2.3bn of private investment and 1,600 new jobs were announced as part of London Tech Week

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AI TECHNOLOGIES COULD ADD AN ADDITIONAL £630bn TO THE UK ECONOMY BY 20355

We are backing research and development for data science OVER 1,100 BUSINESSES and AI. £300m has been START EVERY DAY IN BRITAIN allocated by the Engineering — ONE EVERY 75 SECONDS6 and Physical Sciences Research Council to fund relevant projects We are helping small businesses to grow. This year, the British Business Bank launched THE UK IS NOW RATED 4TH IN four new programmes THE WORLD FOR INNOVATION, and is now supporting over OVERTAKING THE USA7 78,000 smaller businesses with more than £5.5bn We are driving research and innovation through the Industrial Strategy Challenge Fund. 602 different projects have already received £652m in funding support

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12 IN THE FIRST HALF OF MORE THAN 30 AUTOMOTIVE 2018, 1 IN 5 ELECTRIC MANUFACTURERS BUILD VEHICLES SOLD IN EUROPE VEHICLES HERE IN THE UK9 WAS MADE IN THE UK8 We are agreeing partnerships We are committed to reducing with industry to boost emissions, with £1.5bn productivity, employment, investment for ultra low innovation and skills. The emission vehicles by 2020 Automotive Sector Deal will boost the level of UK-made parts in UK- built vehicles so that at least half of their value is manufactured in this country by 2022

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13 Industrial Strategy Forging Our Future

THE £92bn CREATIVE INDUSTRIES SECTOR IS GROWING AT TWICE THE THE UK WILL BENEFIT FROM RATE OF THE ECONOMY11 £600bn INVESTMENT IN INFRASTRUCTURE OVER THE NEXT 10 YEARS10 We are supporting cultural contributions to our local economies. £20m will be We are investing in sustainable awarded to cities and towns and public transport. The for creative, cultural and Transforming Cities Fund will heritage projects through the provide £2.5bn for local projects Cultural Development Fund

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14 2017 WAS THE UK’S CLEANEST, GREENEST YEAR YET13

THOSE AGED 50+ NOW MAKE We are partnering with business UP NEARLY A THIRD OF THE to maximise the opportunities 12 ENTIRE UK WORKFORCE from clean growth. The first Green GB Week in October We are developing technologies 2018 saw 67 pledges, from and industries to support organisations including HSBC, our ageing society, with Tesco and John Lewis £300m from the Industrial Strategy Challenge Fund for relevant research projects THE UNEMPLOYMENT RATE HAS DROPPED TO 4% — THE LOWEST IN OVER 40 YEARS14

We are building the technical skills our workforce needs. Over the past year, 47,000 people started higher level apprenticeships — an increase of 30%.

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15 Industrial Strategy Forging Our Future The Industrial Strategy is having an international impact

The UK-Canada AI 13,000 delegates Innovation Challenge is welcomed to the International inspiring AI solutions in Business Festival in Liverpool aerospace from companies to see UK start-ups involved in both countries. in the Grand Challenges.

Some of the UK’s most innovative businesses met their US counterparts on board the HMS Queen Elizabeth in New York, for a trade mission on $500m invested cyber security and AI. by Japan’s Softbank in Improbable, a London-based company crafting virtual worlds.

The Newton Prize is funding scientists in the UK and Chile to develop ways to strengthen energy infrastructure so that it can withstand extreme weather and natural disasters. £32m invested in Technology Accelerators to build innovative business links between Africa and Britain. 16 Novo Nordisk is In May 2018, the UK signed investing £115m in a new agreements for science and centre for development innovation with Israel, for of medicines that will greater collaboration in shared transform the lives of priority areas including advanced people with diabetes. materials and Ageing Society.

The UK is chairing the £35m planned for EUREKA programme investment in British for 2018/19. This AI start-ups by intergovernmental network Japan’s AI-focused supports innovation-driven Global Brain. entrepreneurship in Europe.

Chinese robotics company JEE Automation Equipment is investing £6m in the UK to establish an assembly and testing facility in Birmingham. The second UK-India Energy for Growth Dialogue took place in September 2018.

£10m invested by the UK and Singapore $72m co-invested with South in a joint quantum Africa in our Clean Growth space programme. ambitions for battery storage.

17 Industrial Strategy Forging Our Future

IDEAS Becoming the world’s most innovative economy

Innovation is about ideas, new ways of doing things, new products and services, new technologies and new business models. HIGHLIGHTS INCLUDE: We are a global leader in science and research, but we need to drive new research and the biggest increase in investment development projects in research and development (R&D) 602 supported by in our history. We must become government funding better at turning exciting ideas into strong commercial products and services, and build on excellence addressing across the whole country. R&D challenges We are ensuring the UK is the £2.7bn through the best place for researchers and Industrial Strategy innovators, and are driving Challenge Fund partnerships between the best minds and businesses throughout Britain. We are already delivering to support record increases in public sector international R&D investment — over £7bn so far £110m collaboration in — with a target to reach 2.4% of GDP science and research across the whole economy by 2027.

18 NEXT STEPS ``Continue to drive investment in R&D, launching an R&D Roadmap to set out how public, private and voluntary sectors will meet the 2.4% target ``Launch a Knowledge Exchange Framework to benchmark how well universities are sharing knowledge and commercialising research ``Announce the first winners of the Strength in Places Fund, DEVELOPING who will receive funding to build CUTTING-EDGE BATTERY on their science and innovation TECHNOLOGIES strengths and develop stronger A team at Birmingham local innovation networks University is leading a project ``Go further to support international to recycle electric vehicle research and innovation battery components. programmes, including the second stage of the Fund for The goal of the ReLiB project is International Collaboration to establish infrastructure in the UK that makes the recycling of ``H e l pindustry transform great lithium-ion batteries from the ideas into new products and automotive sector as efficient services through investing as possible. Currently, electric £1.2bn more public funding vehicle recycling capabilities in the Catapult network are limited in the UK and many materials are not recycled. LONG TERM GOALS Projects like ReLiB are of ``By 2030 we want the UK to be importance if the UK is to meet the most innovative country carbon emissions targets, but in the world: a home to the it also addresses issues with most dynamic businesses at current battery technology. the cutting edge of new Birmingham University’s project technologies and processes is one of four fast-start projects ``We want 2.4% of GDP to be run by the Faraday Institution, invested in R&D across the whole the £78m centre funded by the economy by 2027, increasing Industrial Strategy Challenge Fund. to 3% in the longer term

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PEOPLE Generating good jobs and greater earning power for all

We are putting people at the heart of our Industrial Strategy to ensure that everyone can improve their skills throughout their lives, HIGHLIGHTS INCLUDE: increasing their earning power and opportunities for better jobs. paid to schools and We are equipping citizens for colleges for each jobs shaped by next generation £1,200 additional pupil technology. As the economy taking Maths A level adapts, we want everyone to access and enjoy good work. Investing in our people across their lifetimes is fundamental to increase in A level our shared success, from strong 25% computer science foundations for children and young entries since 2017 people in schools and relevant high- quality education and training in our further and higher education systems to career-long learning people started and enabling employers to invest higher-level in their workforce. We are already 47,000 apprenticeships leading the biggest transformation to technical education in a generation.

20 NEXT STEPS ``Advance reforms to technical education, including through a new £170m network of Institutes of Technology across the country ``Establish 21 new basic maths Centres for Excellence, alongside a £16m programme to increase SUPPORTING WOMEN participation and attainment IN ENGINEERING in level 3 mathematics When Daisy Coombes left ``Set out our commitments to school she had five offers from improve modern working practices universities. But she decided that and protect workers’ rights she wanted to take a different in a new Good Work Plan route to becoming an engineer, ``Expand the network of Maths with a Higher Apprenticeship in Hubs to support schools and Design Engineering with JCB. teachers, as well as continuing to The company pays her a salary upskill computer science teachers and also paid for her degree at through a new £84m programme Sheffield Hallam University, which ``Support fair pay for all. All she studies for one day a week. eligible employers now publish Through the Industrial Strategy, we their gender pay gap data, and are accelerating a transformative we are consulting on being the programme to increase the first country in the world to number of higher apprenticeships, mandate ethnicity pay reporting improve employment outcomes for young people, and meet the skills needs of our economy.

LONG TERM GOALS ``We will be introducing the new to ensure it is underway by the T levels — technical education end of the current Parliament equivalent to A levels — from ``We are reforming apprenticeships September 2020, backed to make them world-class, by an additional £500m per helping employers create high year once fully rolled out quality programmes that give them ``We are developing a National the skills they need. By 2020 we Retraining Scheme, with a will be investing nearly £2.5bn further £100m investment in apprenticeships per year announced in the 2018 Budget

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INFRASTRUCTURE Delivering a major upgrade to the UK’s infrastructure

The country’s economic geography will be transformed through Industrial Strategy investment – from full-fibre broadband, HIGHLIGHTS INCLUDE: new 5G networks and smart technologies such as autonomous for productivity vehicles, to high-speed rail investment, including connecting people to jobs and £37bn better transport and opportunities, the regeneration digital connections of stations and airports and upgrades to the road network. trains fitted We will also improve people’s lives with the latest where they live and work with high digital signalling quality housing and clean, affordable 200 technology by energy. Much of this investment is the end of 2018 large scale and long term, and we will consider this strategically to support wider objectives as well as delivering resilient infrastructure and value for new homes money. We have already initiated 650,000 created through the highest growth in infrastructure the Housing spending out of the world’s seven Infrastructure Fund most industrialised countries.

22 NEXT STEPS ``Trial high-speed digital connectivity in a rural area, with a large-scale Rural Connected Communities Project ``Set out our strategy for addressing the UK’s top infrastructure BOOSTING BUSINESS needs and priorities, as identified THROUGH DIGITAL by the National Infrastructure INFRASTRUCTURE Commission’s recent assessment Sun Salads is a family business ``Invest in public and sustainable in Dorset that grows, packages transport links to centres of and supplies watercress. Due to employment, allocating nearly slow broadband speeds in the £2.5bn to projects in up to 18 cities area, downloads from customer ``Work with the Highlands and ordering systems were often Islands Enterprise to develop plans running overnight. At busy times for a vertical launch spaceport the connections were so slow in Sutherland, which will create they were unworkable. With hundreds of jobs and boost the local supplier Wessex Internet, UK’s commercial space sector Sun Salads applied for a £3,000 gigabit voucher to offset the cost ``Put the Government’s responsibility of a full fibre connection. This was to look after the natural environment installed in May 2018, and the into law with the introduction improvement has been dramatic. of an Environment Bill The option to upgrade to faster speeds in the future will be vital for growing their business further.

LONG TERM GOALS ``We will continue to build our ``We will work to halve the effects of National Infrastructure and air pollution on health by 2030, by Construction pipeline, which meeting targets to reduce emissions is currently worth £600bn. ``We will continue to work with Public investment will have industrial sectors to reduce doubled by 2022/23 their carbon impact, including ``We will end the sale of new through the new Industrial conventional petrol and diesel Energy Transformation Fund cars and vans by 2040

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BUSINESS ENVIRONMENT Becoming the best place to start and grow a business

The UK has a global reputation as a great place to do business, and our Industrial Strategy aims to HIGHLIGHTS INCLUDE: make the country the best place to start and grow a business, and a global draw for innovators. destination for We are driving productivity in venture capital businesses of all sizes by increasing #1 in Europe15 collaboration, building skills and ensuring everyone has the opportunity of good work and high-paying jobs. businesses We are ensuring the financial sector supported by is better connected to the rest of Growth Hubs the economy, driving impactful 375,000 in local areas investments. We are creating a across England business environment equipped for the challenges and opportunities of new technologies and ways of doing business. In the past year the SMEs supported Government has put in place all the 78,000 by the British building blocks to deliver a £20bn Business Bank action plan in support of innovative high-growth-potential businesses.

24 NEXT STEPS ``Introduce new programmes, such as leadership and management training, to help improve the productivity of 5.7m British businesses ``Improve conditions for small businesses with measures to tackle late payments ``Consider how UK businesses can boost their supply chain capabilities to match the best IMPROVING THE in Europe and beyond PRODUCTIVITY OF ``Ensure the competition regime SMALL BUSINESSES is working to support an Be the Business, an initiative led enterprise economy, publishing by businesses and supported a review in Spring 2019 by Government, has launched ``Develop our plans to tackle barriers programmes to help SMEs facing UK businesses looking adopt and share best practice. to export or export more Cumbria Crystal, a manufacturer of bespoke hand-made crystal, completed the Productivity through People programme in Lancaster. This is a 12-month LONG TERM GOALS SME leadership programme ``We will generate over £20bn supported by large businesses investment into high-growth- and delivered by business schools. potential businesses by 2027 Cumbria Crystal Managing ``We will provide management Director Chris Blade said: “We training to 10,000 small spent more time on the business, business leaders by 2025 not in the business. One of my through the Small Business challenges was to think of small Leadership Programme changes all staff could make to increase productivity, margins ``We will increase total or efficiency by 1%. That sounds UK exports from 30% of quite easy — and in fact it wasn’t GDP (as of June 2018) to that difficult. But add up all those 35%. This will add over small gains month-by-month and £100bn worth of exports you can create a big effect.”

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PLACES Developing prosperous communities throughout the UK

The UK has world-leading businesses located around the country. Our cities, towns and HIGHLIGHTS INCLUDE: rural areas in England, Scotland, Wales and Northern Ireland have competitive advantages essential for local plans to to shaping our economic future. make high streets We are building on the strong £675m and town centres foundations of our City, Growth fit for the future and Devolution Deals and continue to work in partnership with local leaders to drive productivity. We cities benefiting are introducing new policies to from £2.5bn improve skills, shaped around the 18 to improve needs of different parts of the intra-city transport country, create more connected infrastructure, back innovation strengths, ensure land is available for housing growth and strengthen to fund local our cultural assets. We are already innovation through working with areas to develop Local £120m the Strength in Industrial Strategies, which will set Places Fund out priorities to drive growth locally.

26 NEXT STEPS ``Work in partnership with strengthened local institutions across the country to agree the first Local Industrial Strategies, including for including Greater Manchester, West Midlands and partners across the Oxford-Cambridge Arc ``Roll out Skills Advisory Panels across England to better coordinate SUPPORTING skills provisions for over 16s LOCAL SKILLS ``Drive clusters of business across Plans are underway for the country to innovate or adopt ‘Maths Month’ on the North new technologies through the Yorkshire Coast, as part of a Strength in Places Fund wider programme to create a ‘love ``Invest in our culture, heritage of Maths’ across the district. The and creative industries across establishment of a Scarborough- the country through the £20m based maths centre ensures that Cultural Development Fund local schools and teachers have access to continuous professional ``Refresh strategies for the development to aid their Northern Powerhouse understanding and delivery of and Midlands Engine teaching for mastery. The maths centre will host teachers from Shanghai as part of an exchange programme, which will provide teachers with an opportunity to learn from specialists.

LONG TERM GOALS ``By early 2020, we will agree ``Build up to 1m high-quality homes Local Industrial Strategies for by 2050 to maximise the economic all places in England, with support growth of the Oxford-Cambridge Arc for places in Scotland, Wales and ``Deliver more City and Growth Northern Ireland that want one Deals across the devolved nations, in addition to those already agreed with regions in Scotland and Wales

27 Industrial Strategy Forging Our Future

The Industrial Strategy is supporting business, research and training throughout the UK

W5 is an interactive discovery centre in Belfast. The Inspiring Science Fund awarded it £3m to create new immersive exhibitions, encouraging young people to consider science careers.

We are helping Swansea University develop new building materials which generate electricity from light and heat, with a £36m grant for the Active Building Centre.

Through the Better Business for All programme, Lynher Dairies Cheese Company in West Cornwall received support to pass food inspections by US regulators. This allowed them to start exporting their handmade cheese to the USA.

Bloomsbury AI used supercomputers to test new AI ideas through a programme run by the Digital Catapult. The resulting technology, called Cape, converts text to knowledge with close to human performance.

28 Bio Technics Ltd. exports innovative hygiene solutions to 17 global markets. They have worked with the Department for International Trade, Scottish Enterprise and Scottish Development International to help them reach their global expansion goals quicker.

The Nissan Leaf car Greater Manchester will plant in Sunderland currently boost the contribution of has capacity to manufacture older workers through its 50,000 electric vehicles Local Industrial Strategy. per year. Sunderland builds Building on the Working Well Leafs for 23 markets, programme, their objective is including Western Europe, for 5,000 more 50-64 year Argentina and Israel. olds in employment by 2020.

As part of the High Value We have launched a Local Manufacturing Catapult, Digital Skills Partnership supported by Innovate UK, between regional business, local the Nuclear Advanced authorities and educational Manufacturing Research institutes in the West Midlands Centre in Rotherham is to boost digital skills and boosting the competitiveness opportunities and support the of the UK civil nuclear growth of the local economy. manufacturing industry.

THURN Group is using robot submarines to enable Consortiq, based in engineers to see hazards Southampton, are expert that ice may cause to drone professionals providing infrastructure, pipelines bespoke unmanned and ships around the Arctic. technology solutions. They They have received project have clients in Canada, UAE, funding from the Industrial Kenya and South Africa. Strategy Challenge Fund.

29 Industrial Strategy Forging Our Future

SECTOR DEALS Building long-term partnerships with businesses

Partnership between the government and industry on DEALS TO DATE: sector-specific issues can create significant opportunities to boost productivity, employment, deals published innovation and skills. across a range 6 of sectors Sector Deals call for sectors to set out proposals to transform productivity in their area. The Government then works with leadership in the sector deals finalised to ensure that the proposal is robust 3 following negotiation and transformative, and deals are announced as and when agreements are reached on an ongoing basis. Sector Deals published to date new deals include commitments to create currently in formal thousands of highly skilled jobs 3 negotiation around the country, and support for innovative and entrepreneurial work.

30 LIFE SCIENCES IMPROVING THE HEALTH The Life Sciences Sector Deal (December 2017) focuses on ensuring OF THE NATION new pioneering treatments and As part of the Life Sciences medical technologies are produced Sector Deal, we issued a in the UK, improving the lives of £30m contract for a Vanguard patients and economic growth. Study, the first phase of a programme to sequence ``O v e r£1.5bn co-investment in long- term medical challenges and early the genomes of all 500,000 diagnostics and precision medicine participants in the UK Biobank. By looking at whole genomes, ``Accelerate approval for clinical trials and a Digital Health Catalyst scientists will discover new to help SMEs work with NHS to insights into human biology, develop new technologies with the potential to prevent disease and save lives ``A new state-of-the-art research through earlier diagnosis and development hub from and targeting of treatment pharmaceutical company MSD throughout the country. The Life Sciences Sector Deal ensuring that the next wave “This Life Sciences Sector Deal … of breakthrough treatments, represents a significant change innovative medical research and in both pace and culture … technologies, and high skilled that can lead to the discovery jobs are created in the UK. and implementation of novel innovations for healthcare.” Sir John Bell, Regius Professor of Medicine, University of Oxford, Industry lead for Sector Deal

31 Industrial Strategy Forging Our Future

AUTOMOTIVE DELIVERING NEW The Automotive Sector Deal (January 2018) ensures that the TECHNOLOGY FOR UK continues to reap the benefits ELECTRIC VEHICLES from the transition to ultra-low and The Advanced Propulsion Centre zero-emission vehicles by continuing (APC) has invested £80m in to build agile, innovative and cost the UK Battery Industrialisation competitive supply chain needed to Centre, which is scheduled secure international investment. to open in March 2021. This ``£1bn co-investment in the next will help commercialise the generation of electric, connected battery technology needed and autonomous vehicles for electric vehicles. ``Ambition for 50% UK suppliers as Since it was launched in July part of programme to improve the 2013, the APC has awarded competitiveness of UK supply chain £345m government funding to 41 collaborative research and ``Flagship projects to support the development projects, worth next generation of driverless £715m. Almost 150 individual and low-carbon vehicles led organisations are being supported by major industry leaders through the APC programme, which will help to secure or create over 23,400 jobs and avoid “The deal strengthens our long- the creation of 40m tonnes of standing partnership with carbon dioxide. The technologies government to keep the UK at the they are working on are initially forefront of electric, connected for the automotive sector but and autonomous vehicles.” will have wider application. Mike Hawes, Chief Executive SMMT

32 Oxford Quantum Circuits is developing electric circuits for quantum computing. The £800m National Quantum Technologies Programme is boosting growth in this ‘future sector’

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CREATIVE INDUSTRIES RESEARCHING THE The Creative Industries Sector Deal (March 2018), led by the Creative CHALLENGES FACING Industries Council and with input from CREATIVE INDUSTRIES the Creative Industries Federation and The Creative Industries Clusters others across the sector, is boosting Programme (CICP) is a five growth for creative business. year scheme to foster research ``£150m joint investment and development, with £80m including a Cultural Development of Industrial Strategy funding Fund to support creative as part of the Sector Deal. clusters across the UK As part of this programme, ``Industry-led creative careers nine creative research and programme to reach 600,000 development partnerships students and development of between universities and new apprenticeship standards industries are receiving funding to take on unique challenges faced ``A new campaign to increase by a range of creative sectors awareness of online intellectual including screen industries, property rights fashion technology, video games, animation and storytelling.

“The Creative Industries Sector These partnerships span the Deal was a major landmark for UK including Cardiff, Edinburgh, our sector which underlines its Ulster, Dundee, Leeds and in the importance to the UK economy, south of England. It incorporates and provides a platform for over 1,000 projects, creating further success over the coming an expected 700 new jobs and years. Implementation is now well 150 new business ventures. underway and I look forward to continued collaboration within the Council, and with many others across industry and Government, to deliver and build on the commitments of the deal.” Tim Davie, Chief Executive Officer of BBC Studios and industry chair of the Creative Industries Council

34 ARTIFICIAL INTELLIGENCE COLLABORATING The Artificial Intelligence Sector Deal (April 2018), is boosting the INTERNATIONALLY UK’s global position as a leader in TO MAKE AIRCRAFT developing AI technologies by taking MORE EFFICIENT tangible actions to advance our AI A new AI Innovation Challenge and Data Grand Challenge and ensure calls on innovators to use the UK is the go-to destination for artificial intelligence to make AI innovation and investment. aircraft less costly and more ``£1bn co-investment in eco-friendly by burning less fuel. innovation such as Govtech, Start-ups and researchers next generation services or can pitch ideas for AI to help the role of AI technologies improve the systems used to in the creative industries prevent ice build-up on wings ``A c t i o n s t oincrease data availability and help aircraft reach their and boost high level skills optimum performance. ``Funding for specialist AI research, Applicants will be invited to including 1,000 AI PhDs pitch their ideas directly to Bombardier’s Belfast-based wing factory and industry experts. The winner will have “The sector’s formal inclusion the opportunity to meet with in the industrial strategy [is] Bombardier to explore a crucial to a thriving production potential future collaboration. industry in the UK.” Josh Berger, President, Warner Brothers UK

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NUCLEAR IMPROVING NUCLEAR The Nuclear Sector Deal (June 2018), ensures that the UK’s nuclear sector DECOMMISSIONING remains cost competitive with other Sellafield Ltd is carrying forms of low-carbon technologies out essential nuclear to support our Clean Growth decommissioning work, using Strategy and Grand Challenges. cutting edge technology enabling it to meet the ``£200m co-investment programme in emerging nuclear highest safely standards. technologies including small and We want to achieve greater value advanced nuclear modular reactors for the taxpayer in the way we Industry has committed to conduct nuclear decommissioning stretching targets including: in the UK, and have set a target of a 20% reduction in the costs ``30% reduction in the cost of decommissioning by 2030. of new build projects A joint government and industry ``20% savings in the cost of review is underway to establish decommissioning compared a national decommissioning with current estimates and waste management ``40% women in civil nuclear by pipeline. This aims to create 2030 (approximately 22% today) opportunities for the UK economy by reducing barriers to entry for the supply chain. “This ambitious deal between industry and government will ensure nuclear plays a key role in providing the UK’s low-carbon energy supply for the future, maximising opportunities in overseas markets, leveraging technology and innovation and increasing competitiveness.” Tom Greatrex, CEO of the Nuclear Industry Association

36 The online Export Opportunities service showcases more than 20,000 export opportunities for UK businesses

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CONSTRUCTION TEACHING CONSTRUCTION The Construction Sector Deal (July 2018), sets out a partnership between SKILLS government and industry that aims 60 new construction to transform the sector’s productivity apprenticeship standards are through innovative technologies and now in place, covering essential a more highly skilled workforce. trade skills such as bricklaying, carpentry and plumbing as well ``£450m joint investment in digital construction and as degree level apprenticeships offsite manufacturing to in architecture and civil deliver 50% reduction in time engineering. This already exceeds taken to deliver new build the Sector Deal target of 50 standards by the end of 2018. ``25,000 construction apprenticeship starts and 1,000 The Construction Skills Fund Construction T level placements also has £24m, plus funding from September 2020 from the Construction Industry Training Board, to establish 27 onsite training hubs for 18,000 students by 2020. “The new construction industry Sector Deal is to be welcomed, and its focus on digitising the construction industry, as well as off-site manufacturing, will be a shot in the arm for the sector.” Graham Robinson, Global Business Consultant and Director of Global Construction Perspectives, Pinsent Masons

38 HIGHLIGHTS INCLUDE: RAIL SECTOR DEAL We are in advanced investment by negotiations on mutual both Government commitments to deliver and Industry in £3bn and deploy new technologies, key UK sectors encourage investment, incentivise greater collaboration, and increase export potential. individual commitments AEROSPACE 200 across sectors to boost productivity SECTOR DEAL We will look to conclude a Sector Deal which of the UK workforce will support advances in how employed in the we power flight, increase the 16% six sectors with competitiveness of the supply early Sector Deals chain, improve the diversity of the sector, and boost the number of aerospace apprenticeship starts.

NEXT STEPS FOOD & DRINK We will continue analysis of Sector MANUFACTURING Deal proposals to ensure that the most SECTOR DEAL transformative bids are taken forward We have launched formal ``We will monitor the implementation negotiations with the Food and of published Sector Deals to ensure Drink manufacturing sector. that maximum value is extracted An agreed deal would include commitments to support ``We will continue engagement manufacturers to export to with industry to ensure that the new markets and accelerate Sector Deals are designed in the the diffusion of productivity- most beneficial way possible enhancing technologies. ``We will review each Sector Deal at the one year point to maintain momentum and refresh ambition if necessary

39 Industrial Strategy Forging Our Future

AI AND DATA GRAND CHALLENGE Putting the UK at the forefront of the AI and data revolution

Artificial intelligence and machine learning are already HIGHLIGHTS INCLUDE: transforming the global economy, using vast datasets package from the AI to perform complex tasks. Sector Deal which These range from helping doctors £1bn will strengthen the diagnose medical conditions more UK’s position as effectively to allowing people to a global leader communicate across the globe using instantaneous speech recognition and translation software. allocated to fund The AI and Data Grand Challenge is £300m data science and seeking to build the best environment AI research for developing and deploying AI and data technologies in a positive way for people and society. It is focusing to be invested in on building the skills, talent and AI Fellowships to leadership in the UK, promoting bring the best adoption across sectors, and £50m AI researchers ensuring AI and data technologies to the UK are used safely and ethically.

40 FIRST MISSION

Use data, Artificial Intelligence and innovation to transform the prevention, early FIGHTING TERRORIST diagnosis and treatment of CONTENT ONLINE USING AI chronic diseases by 2030. The Home Office worked with company ASI Data Science NEXT STEPS to develop machine learning ``Launch Data Trust pilot(s) technology that can automatically to explore frameworks and detect terrorist video propaganda mechanisms for safe, ethical on any online platform, ensuring and fair sharing of data the majority of content is stopped before it reaches the ``Set up the AI Council to internet. Tests have shown this galvanise support and maximise tool can automatically detect the ethical uptake of AI 94% of terrorist propaganda technologies across the UK with 99.9% accuracy – if it ``Review how the Government can analyses one randomly selected use AI, automation and data video, only 50 would require in new ways, to drive public additional human review. The sector productivity and tool can be deployed by smaller wider economic benefits platforms that are increasingly deployed by terrorists and their ``Collaborate with global partners on shared AI and data opportunities supporters and that often do not and challenges formulating have the resources to develop responses that have international automated detection technology. traction and credibility

“Artificial intelligence has the potential to transform our world for the better but to be successful we need to galvanise people in businesses right across the country. I’m honoured to be named chair of the AI Council because I’m passionate about championing the rapid and responsible adoption of this cutting-edge technology. By focusing on skills, data ethics and diversity, we can boost innovation and funding and put the UK at the forefront of this exciting and revolutionary sector.” Tabitha Goldstaub, co-founder of CognitionX, AI Council Chair, and AI Business Champion

41 Industrial Strategy Forging Our Future

AGEING SOCIETY GRAND CHALLENGE Harnessing the power of innovation to help meet the needs of an ageing society

In the UK and globally, we have made significant progress in supporting HIGHLIGHTS INCLUDE: people to live longer. One in three children born in invested to the UK today can expect to support innovation live to 100. An ageing society £98m for healthy ageing profoundly impacts our society and economy. It means thinking differently about work, finances, from Newcastle housing, communities and health. University and the The Ageing Society Grand Government for a Challenge aims to harness the £40m National Innovation significant economic opportunities, Centre for Ageing including technologies, products and services more suited to our future. We want everyone to lead more 50-64 fuller, healthier and more active year olds expected lives, and support a new generation 5,000 to be employed in of businesses to thrive in the Greater Manchester growing market for products and by 2020 services that support older people.

42 FIRST MISSION

To ensure that people can enjoy at least five extra healthy, independent years of life by 2035, while narrowing the gap between the experience of the richest and poorest.

NEXT STEPS IMPROVING CARE ``Work with national centres of THROUGH NEW expertise and local areas to TECHNOLOGIES address the opportunities and Internet of things (IoT) challenges of an ageing society, technologies can help people encouraging a range of approaches remain independent for longer in Local Industrial Strategies if they have a care need, such as ``Publish a new Prevention remote monitoring sensors to Green Paper outlining our plans alert friends and loved ones when to delivery five extra healthy there is an emergency. They can independent years of life for all also be used to collect vital data that enables preventative action. ``Launch a competition to design the home of the future — building Vodafone’s new V-SOS wristband more energy efficient and suitable is one example. This product homes for all generations, with can detect falls, and features high-quality affordable design an SOS button and a simple interface. The wristband will ``Open up UK business alert family members if the opportunities across this new wearer needs help, whether Longevity Economy, through work they are out and about, at to develop international research home or even in the shower. and innovation collaborations

“At Vodafone we believe that technology and innovations like IoT will help us live longer, safer, more enjoyable lives. The Ageing Society Grand Challenge is an example of the political leadership needed to encourage people to take up and spread the word about the opportunities available.” Anne Sheehan, Enterprise Director, Vodafone

43 Industrial Strategy Forging Our Future

FUTURE OF MOBILITY GRAND CHALLENGE Becoming a world leader in the way people, goods and services move

We are on the cusp of a HIGHLIGHTS INCLUDE: profound change in how we move people, goods and new measures to services around our towns, boost take up of city and countryside. 46 electric vehicles This is driven by extraordinary included in our Road innovation in engineering, to Zero strategy technology and business models. New technologies can transform public transport. funding for research and development The UK’s road and rail network into zero emission could dramatically reduce carbon £106m vehicle technology emissions and other pollutants, congestion could be reduced through higher-density use of governments road space enabled by automated committed to a zero vehicles, and mobility could be emission future available when we want it, where 13 for road transport we want it and how we want it.

44 FIRST MISSION

We will put the UK at the forefront of the design and manufacturing of zero emission vehicles and for all new cars and vans to be effectively zero emission by 2040.

NEXT STEPS ``Respond to changes in technology and trends in our urban environments with a Future of INVESTING IN Urban Mobility Strategy in 2019 ELECTRIC VEHICLES ``Establish a suitable regulatory LEVC is the manufacturer of framework for new technologies the iconic black cab. It has such as electric and invested £325m in a dedicated autonomous vehicles, starting electric vehicle manufacturing by conducting a Future of facility in Coventry, which Mobility Regulatory Review will create 1,000 new jobs. ``Support and enable the The company’s first product,a development of drone range-extended electric taxi technology in the UK in a way which will be able to go further that responds to society’s needs without running out of power, is ``Continue work towards our goals for currently on sale and LEVC will be 50-70% of new cars to be ultra bringing an electric van to market low emission by 2030, as a step next year that uses the same towards achieving the first mission range-extended EV technology.

“A transport revolution in the way people and goods move around will see more changes in the next 10 years than the previous hundred. As the Future of Mobility Grand Challenge Business Champion, I’m looking forward to working with the Government to help the UK build on its existing strengths and capitalise on that opportunity.” Ian Robertson, BMW UK Chief Executive, and Future of Mobility Business Champion

45 Industrial Strategy Forging Our Future

CLEAN GROWTH GRAND CHALLENGE Maximising the advantages for industry from the global shift to clean growth

The global drive to reduce carbon emissions will transform all sectors of the economy, HIGHLIGHTS INCLUDE: including power, transport and construction. to develop It is estimated that the UK’s low carbon smart systems economy could grow by as much as £273m and transform four times the rate of the rest of the construction economy between now and 2030. The UK is already a global leader in key low carbon sectors, including the businesses world’s largest offshore wind sector, pledged to take leading in the manufacture of electric clean growth vehicles, in innovative ‘smart systems’ 60+ action during and services such as green finance. Green GB week The Clean Growth Grand Challenge builds on this, aiming to put the UK at the global forefront of the government development, manufacture and funding for low use of low carbon technologies, £320m carbon heating, systems and services needed matched by industry to tackle climate change.

46 FIRST MISSION

We will use new technologies and modern construction practices to at least halve the energy use of new buildings by 2030.

NEXT STEPS GROWING THE GREEN ECONOMY GLOBALLY ``Support clean growth through implementation of the policies Coventry-based company and commitments in our Organics, has developed over Clean Growth Strategy 300 low carbon projects in 21 countries around the world. ``Develop the UK’s place at the These include Covered Lagoon forefront of green finance by Bioreactors (CLBR); anaerobic publishing a Green Finance digestion facilities that are used to Strategy in Spring 2019 treat agricultural wastewater from ``Launch a design competition cassava mills; and sustainable for the ‘Home of the Future’ in palm oil facilities to produce power. 2019, supporting innovation in One facility for a large tapioca housing design and delivery, conglomerate in south Sumatra key to our Buildings mission treats wastewater from a 200 ``Build on our first annual tonne-per-day starch facility Green GB Week with a second and generates 1500 m3/hour week and ongoing Green GB of biogas for use in the milling campaign planned for 2019, and process. It also has the benefit establish a new panel with a Clean of avoiding pollutants entering Growth Business Champion the environment and reducing greenhouse gas emissions.

“The Industrial Strategy’s Clean Growth Grand Challenge can play a key role in moving the UK to a competitive, low carbon economy by supporting the roll out of existing technologies at scale, as well as innovation in new equipment and processes for sectors that have been more difficult to tackle to date, such as buildings, industry and long-distance transport.” Nick Molho, Executive Director of the Aldersgate Group

47 Industrial Strategy Forging Our Future

Industrial Strategy Council

An independent view on our success

The first meeting of the Industrial Strategy Council took place on 1st November 2018 in Downing Street. “Our modern Industrial This new body is comprised of Strategy is key to building leading figures from business, a successful economy that academia and civil society with a works for everyone and wide range of local, national and creating high-quality jobs international perspectives. across the UK. This Council The Council is independent of the gathers some of the most Government and will provide impartial influential figures in business, and unbiased evaluation of progress academia, and civil society. in delivering the aims of the Industrial Together, they will share Strategy. The remit of the Council their expertise and skills includes reviewing the impact of the Industrial Strategy to date and its to measure the progress of contribution to UK economic growth. our strategy and ensure it is boosting people’s wages It is chaired by Andy Haldane, the Chief Economist at the Bank of and improving productivity England. The Prime Minister, the of British businesses.” Chancellor and the Business Secretary Theresa May, Prime Minister also attended this first meeting.

48 INDUSTRIAL STRATEGY COUNCIL MEMBERS: ``Andy Haldane (Chair) — Chief ``Nicola Mendelsohn — Advertising Economist, Bank of England executive; Vice-President for ``Dame Kate Barker — Commissioner Europe, the Middle East and of the National Infrastructure Africa for Facebook. Non- Commission and recently Chair of Executive Director of Diageo the Industrial Strategy Commission ``Archie Norman — Chair, Marks & ``Emma Bridgewater — Founder Spencer. Formerly Chief Executive of Emma Bridgewater Ceramics of Asda, Chair of ITV, McKinsey ``Professor Diane Coyle — Bennett Consultant and Director at GEEST, Professor of Public Policy at Railtrack and Kingfisher the University of Cambridge ``Hayley Parsons — Entrepreneur and ``Jayne-Anne Gadhia — Ex-Chief investor, founder of GoCompare, and Executive, Virgin Money, member adviser to the Welsh government of the Scottish Business Taskforce ``Roy Rickhuss — General Secretary ``Christine Gaskell — Local of Community union and member Enterprise Partnership (LEP) of the General Council of the Chair, Cheshire and Warrington Trades Union Congress ``Rupert Harrison — Managing ``Professor Dame Nancy Rothwell Director of BlackRock — President and Vice-Chancellor of the University of Manchester ``Dame Vivian Hunt — Managing and Professor of Physiology, Co- Partner UK and Ireland, McKinsey, chair of the Council for Science Chair of CBI London Council and Technology and past President ``Dame Rotha Johnston — Chair of the Royal Society of Biology of Northern Ireland Screen, non- ``Professor Jennifer Rubin — executive director of Northern Executive Chair of the Economic Ireland Electricity, board member and Social Research Council of the Department of Justice and (ESRC), Professor of Public Policy Belfast Harbour Commissioners at Kings College London ``Professor Juergen Maier — ``Rohan Silva — Co-founder of Chief Executive of Siemens plc Second Home, Senior Visiting ``Sir Paul Marshall — Co-founder Fellow at LSE Cities and Chairman, Marshall Wace LLP ``Matthew Taylor — Chief ``Sir Charlie Mayfield — Chairman, Executive, Royal Society for John Lewis Partnership, the encouragement of Arts, Chair of Be the Business Manufactures and Commerce (RSA)

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51 Industrial Strategy Forging Our Future

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