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Manufacturing Sector

Volume 749: debated on Thursday 2 May 2024

11. What recent assessment she has made of the contribution of the manufacturing sector to the economy. (902623)

The UK is a global hub for advanced manufacturing, and according to the OECD, the UK’s manufacturing sector has had the fastest growth in the G7 since 2010. The importance of the sector was highlighted in the Manufacturing Technologies Association’s recent “The true impact of UK manufacturing” report. Manufacturing contributed £217 billion gross value added to the UK economy in 2023, and plays an outsized role in the key drivers of growth, including by accounting for over 40% of UK exports.

The UK leads the way in areas such as artificial intelligence, robotics and the internet of things, which are important for our future, especially in manufacturing. How is that strengthening British businesses and the British economy?

It is well known across the House that my hon. Friend is a strong champion for manufacturing and advanced technologies. The Government are also strongly committed to supporting research and development and innovation, because they contribute significantly to our economic growth. In particular, industrial technologies such as robotics and AI are supporting manufacturing businesses to be more productive and sustainable. That is why the Government have increased R&D investment to £20 billion a year, and are expanding Made Smarter, our highly successful industrial digitisation programme for small and medium-sized enterprises.

Mainly because of this House’s worship of the false idol of net zero, electricity costs to businesses in the UK are four and a half times higher than those in China and three times higher than those in India. Can the Minister explain how manufacturing businesses in the UK can compete with that on world markets?

I hope that the hon. Gentleman will join me in welcoming the introduction of the British industry supercharger, which reduces electricity costs for major energy-intensive industries. I hope that it will benefit businesses in his constituency and across the country.

A key sector of the manufacturing economy is the plastics industry, which employs 155,000 people and has an annual turnover of £28.7 billion. In July 2023, the UK Government began a consultation on the plastic packaging tax and the methodology behind it. In February, some 14 organisations signed a joint letter to the Government urging the swift publication of that consultation. When exactly do the Government expect to be able to respond to that long-overdue consultation?

The hon. Gentleman is right: the UK plastics industry is highly important and contributed £8.2 billion to the economy last year. I am aware of the consultation, which is led by the Treasury, and I will ensure that he gets a reply.