Greg Clark – 2019 Statement on British Steel

Below is the text of the statement made by Greg Clark, the Secretary of State for Business, Energy and Industrial Strategy, in the House of Commons on 22 May 2019.

With your permission, Mr Speaker, I would like to make a statement about British Steel.

It was announced this morning that the court has granted an application by the directors of British Steel to enter an insolvency process. Control of the company will now pass to the official receiver, an employee of the Insolvency Service, who will run a compulsory liquidation. The official receiver has made it clear that British Steel employees will continue to be paid and employed, and the business will continue to trade and to supply its customers while he considers the company’s position. In fact, employees were paid early, with the May payroll being run yesterday through cash being advanced by the company’s lenders.

As the House will recall, I made a statement on 1 May setting out details of a bridging facility that the Government agreed to provide to ensure that British Steel was able to meet its obligations under the EU emissions trading scheme, which fell due on 30 April. The Government provided the facility to purchase allowances worth £120 million against the security of 2019 ETS allowances, which are currently suspended pending ratification of the withdrawal agreement.

Without this facility, British Steel would have faced a financial pressure of over £600 million—the ETS liability, plus a £500 million fine. This would not only have placed British Steel in an insolvent financial position, but the charge attached to its operational assets would have been likely to prevent any new owner from acquiring these assets in the future. This transaction demonstrated the Government’s continuing willingness to work closely with all parties to secure the long-term success of this important business.

Following this agreement, the Government have worked intensively with the company for many weeks to seek solutions to the broader financial challenges it has been facing. The Government and individual Ministers can only act within the law and this requires that any financial support to a steel company must be made on a commercial basis. In the case of the ETS facility, this was based on the security of future ETS allowances.

To provide liquidity to the business in the face of its cash-flow difficulties the Government were willing to consider making a cash loan to the company and worked hard to investigate exhaustively the possibilities. However, the absence of adequate security, no reasonable prospect that any loan would have been repaid and the shareholder being unwilling to provide a sufficient cash injection itself meant that this did not meet the required legal tests.

I am placing in the Library the accounting officer’s assessment of these proposals, drawing on professional and legal advice, which concludes:

“It would be unlawful to provide a guarantee or loan on the terms of any of the proposals that the company or any other party has made or any others we have considered. You must note that such an offer cannot be made legally and that by making it you would be in breach of the Ministerial Code.”

The insolvency removes Greybull from day-to-day control of British Steel. Given the Government’s willingness to help secure British Steel’s future, demonstrated in the ETS facility, and the discussions that have taken place ​in recent weeks, the Government will work closely with the official receiver and prospective new owners to achieve the best outcome for these sites.

The Government have provided an indemnity to the official receiver, who is now responsible for the operations. We will take every possible step to ensure that these vital operations can continue, that jobs are secured and that the sites at Scunthorpe and Skinningrove and on Teesside continue to be important centres of excellent steel-working. During the days and weeks ahead, I will work with the official receiver, the special managers and a British Steel support group of trade unions, management, suppliers, customers and the local communities to pursue remorselessly every possible step to secure the future of these valuable operations.

This is a very worrying time for everyone associated with British Steel. Each one of British Steel’s sites has a proud record of steelmaking excellence, and I am determined to see it continue. Britain and the world will continue to need high-quality steel, and British steel is among the best in the world. Today is a very big setback for these operations, but it is far from being the end and we will take every step possible to secure a successful future for these vital assets, both people and plant.

Greg Clark – 2019 Speech at EEF Manufacturing Conference

Below is the text of the speech made by Greg Clark, the Secretary of State for Business, Energy and Industrial Strategy, at the EEF Manufacturing Conference on 19 February 2019.

Thank you Steph for that introduction – it’s always a pleasure to be introduced by a fellow Teessider!

Honda announcement

Before I go any further, I just want to comment on the announcement made by Honda this morning that their Swindon plant will close in 2021.

I am not going to pretend that this is anything other than a bitter blow.

My thoughts this morning are with the 3,500 skilled and dedicated Honda workers and their families; and the suppliers of what has been a phenomenally successful business and has done so much for UK manufacturing during its time here.

And with the town of Swindon, whose proud manufacturing tradition, as everyone knows, dates way back to Brunel and the days of the GWR, and which has been home to one of the best car factories in the world during Honda’s time there.

And so our message to everyone affected by Honda’s closure is that we value intensely your skills; we completely understand the challenges that you face; and we will do everything that we possibly can to support every single person in the community, in the workforce, in the supply chain, to make sure that their skills and their ingenuity will find expression and application in the years ahead.

Brexit preparations

Now of course this news comes on top of months of uncertainty that you, as manufacturers, have had to endure about Brexit and about our future relationship with the EU.

And just spotting in the audience so many people that Richard and I meet during the course of our work – I know how important it is to you that we should find an early resolution of what our relationship with the rest of the European Union is going to be.

Because you know that every decision that you make – on prices, on cash flow, on logistics and investment – has real consequences for the hundreds of thousands, indeed millions of people that you employ.

And I’ve been always been quite clear that a situation in which our manufacturers don’t have the certainty that they need about the terms under which over two-thirds of our trade will be conducted in less than 40 days’ time is unacceptable.

It needs to be brought to a conclusion, and without further delay.

I am immensely grateful to Stephen Phipson and the EEF, now Make UK, for the advice and the support they have given on your behalf.

This is a membership organisation, and I want you to know that the views you express to the headquarters are deployed forensically and consistently by Stephen on your behalf.

Richard and I meet with Stephen every Wednesday morning for a full hour’s discussion of what he’s found from his interactions with you during the previous week.

And it really makes a difference. I can’t understate the importance of the evidence and intelligence that you supply through Stephen to us in our roles.

And it’s with the help of the EEF that we made, first of all – and won – the argument for a significant transition period, recognising that you need time to adjust to a new regime, whatever it is. A period during which your ability to trade with the EU remains as now time to adjust to new arrangements.

It was also based on the evidence. I think there’s been a national education in the realities of just-in-time production and integrated supply chains that the whole country has learned, but very much pioneered through the evidence that you’ve supplied to Stephen and has been deployed through the EEF.

That shaped the crucial objective of maintaining frictionless trade and that remains front and centre in our aims for the future economic partnership with the EU.

Richard and I will continue to work with you and to listen to you – the manufacturers and the employers – to make sure that your voice is decisive in this crucial debate.

And yet – as important as this all is, I can’t stand here today and claim to you that all of your requirements have been resolved.

To do that we need to have a deal. Because leaving the EU without one would, in my view, be a disaster for the whole country.

In the survey that EEF – Make UK – published just last week two-thirds of manufacturing employers said that ‘no deal’ would result immediately in price increases on products.

Whilst almost one-third of manufacturers said that ‘no deal’ has implications for jobs.

Now some people, when you voice these concerns, describe this as ‘Project Fear. But for me – knowing the familiarity that you have with the reality of running manufacturing operations and employing millions of people around the UK – I think it is better described as ‘Project Reality’.

Your evidence needs to be acted upon. And I know – from talking to many of you of the consequences from the logistical problems caused by new customs checks. To potential limitations on sending skilled workers to the UK to install, to maintain and service your products.

There is, I think, a lack of adequate understanding, historically, in this country, as to how intrinsic manufacturing is to the success of our service economy.

Many of your products, many of your revenues, I know, derive from the service contracts that you have in support of the manufacturing operations that you have in this country.

And I also know and entirely understand the importance of having this resolved much more quickly than I think has been in prospect.

The reality is that yesterday the first freighter that will arrive after the 29 March 2019 set off from Felixstowe bound for Japan with no clarity on the terms under which its cargo will be admitted when it reaches its destination.

That is, I know, unacceptable to you. And it’s unacceptable to me.

For me this shows how absolutely essential it is to conclude the arrangements with a deal in the weeks ahead.

And not on the last minute on the 28 March, but as soon as possible.

Because no one should regard waiting to the last moment, when you are making decisions now that have consequences for many weeks and months ahead, as acceptable.

I’ve always thought, and my colleagues in government have, that an orderly Brexit – one that implements the outcome of the referendum but in a way that protects prosperity, growth and jobs is what we should insist on.

No one wants to be poorer at a time when the opportunities that we have in manufacturing specifically are greater than ever before.

So, we will go on making sure that the argument that manufacturers put for a deal to be concluded swiftly is something that is heard loud and clear.

The deal that has been proposed is by no means perfect, but it does meet, in the view of many of you here, the needs that you’ve expressed. And in particular, provides more certainty in a time of great uncertainty.

But of course, decisions like Honda’s this morning demonstrate starkly how much is at stake.

Honda’s announcement they have described as not being related to Brexit, but to the changes that are taking place in the automotive sector.

And there are many people in this room that are aware of that and participate in that.

And that’s why this is such an important time to build on the foundations that we have in our economy to make sure that we profit from the opportunities in areas in which the UK has a stunning reputation.

Made Smarter

A few months after the EU referendum I had a conversation with someone known to everyone in this room – the Siemens UK CEO Juergen Maier – which gave birth to the idea behind Made Smarter.

Making sure that smaller firms have the ability to access the cutting-edge of new technologies that sometimes are taken for granted by the larger OEMs and some of our research institutions – encouraging and helping smaller firms to adopt new technologies that can help them become competitive in this time of global change, and to create more jobs.

The idea struck a chord and many people in this room are involved with the Made Smarter Commission that resulted from that.

And based on Jurgen’s work and supported by you we have had a huge response right across the UK from the manufacturing community from companies big and small in every nation of the United Kingdom.

We’ve made substantial progress already.

In September, I chaired the first meeting of the Made Smarter Commission attended by many companies in the room today.

The very next month, in October we announced 120 million pounds to make sure that this diffusion of the technologies that we have in this country to supply chains in every part of industry should be able to be supported.

And at the heart of Made Smarter will be what I know is manufacturers’ No. 1 priority – skills.

World-class manufacturing

There are so many lingering misconceptions that I’m sure you as I are frustrated about, that people have the wrong view of manufacturing.

The EEF under Stephen asked the British public to guess how UK manufacturing ranked globally the average guess was 56th.

Actually, we’re 9th in the world, and can rise more strongly. Kazakhstan is 56th.

But the perception needs to be countered, which is one of the big purposes of Made Smarter. EEF’s Chair Judith Hackitt, who I know is here today, is a formidable leader of that initiative to change perceptions of what manufacturing and engineering are about, to show the reality of modern manufacturing as one of the most exciting vocations that exist in Britain today.

We should be proud of the world-class manufacturing talent that we produce in this country, and we need to produce more.

And whenever I meet apprentices – whether it’s at the MTC, the Manufacturing Technology Centre just outside Coventry, the AMRC in Sheffield, or Make UK’s own apprentices in Aston, I’m blown away by the sense of privilege that people have, that have managed to discover what a fantastic career is in prospect if they get into manufacturing and engineering.

While companies like Lander Automotive – whose Managing Director Peter Tack is with us here today are creating new apprentices – 15 apprentices being recruited every 8 weeks to be embarked on a career that will take them around the world with excitement and discovery every year of it.

And as more companies embrace new technologies it won’t be about people or technology, but people and technology.

I was struck at the Manufacturing and Technology Centre looking at the latest application of robots.

The big question is: are these robots going to replace people?

Quite the reverse. All of the skills there – and you know it in this room – are about making sure that we learn to work effectively with automation: people working alongside robots, or deciding what to do with data analysis.

But as new technologies require new skills we must make sure that these opportunities are available to all.

Through our Industrial Strategy, our new National Retraining Scheme, which is designed to help people learn new skills as the economy changes, including as a result of automation.

We are also putting significant investment to help SMEs their leadership and management skills that again are often available more easily to larger companies, but to reap the opportunities that we have in the world we want to make sure that the best skills are available to leaders of some of our smaller businesses.

With a management training programme which could help 10,000 people a year over the next few years.

And just as no-one should be left behind by the new technologies sweeping this industry, no place should be left behind either.

I hope that Made Smarter will support small businesses, and small manufacturers right across the UK.

In pursuance of that goal the first wave is in the North West, working with the towns and cities of the North West – Cheshire and Warrington, Cumbria, Lancashire, Liverpool and Manchester – to make sure that small businesses there are first to benefit to really reinforce what is already a strong cluster of manufacturing excellence.

We need to make sure the opportunities of the fourth industrial revolution are available to every single firm in the economy.

But in helping firms understand their data and, where suitable to automate production, we can make a real impact.

And there’s been a huge response in the North West, with 140 businesses signed up already to learn from the best in the country as to how they can spread industrial digitalisation.

As well as in automotive – we have a firm looking to use robotic equipment on the production line. We want the applications to be in, for example, food manufacturing – our most important manufacturing business line at the moment.

We want this pilot to become a beacon for schemes in regions right across the country.


So, ladies and gentlemen.

In the coming days and weeks we are very conscious that your future prosperity in a world of change and opportunity must be at the forefront of our attention in all of the policy decisions that we take.

Our test of a successful Brexit is that it should work for manufacturing industry at this time of such great opportunity, and through that, the millions of people who depend on you.

Just as we stand on the cusp of amazing new opportunities for manufacturers, we must retain and create the future possibilities for everyone in this room.

And we’re conscious that every hour, every pound spent being devoted to Brexit preparations is necessary – I understand. But actually it is not the main focus of your work, which is to create the products, processes and customers that will sustain the UK for many years to come.

So I look forward to continuing the very effective work that we do with the EEF – and now I hope with Make UK. That we can in a short space of time now agree a deal that brings the certainty that you’ve communicated so clearly that you want.

And we can make the UK as synonymous with the fourth industrial revolution as we are, through our history books, with the first.

Thank you very much.

Greg Clark – 2019 Statement on Honda in Swindon

Below is the text of the statement made by Greg Clark, the Secretary of State for Business, Energy and Industrial Strategy, to the House of Commons on 19 February 2019.

With permission, Mr Speaker, I would like to make a statement on Honda. This morning, Honda announced that future models of its Civic car, which are currently made in Swindon, will after 2021 be made in Japan. The Civic is the only vehicle made by Honda in Swindon, so the result of the decision is that the company’s manufacturing plant will close in 2021.

I am not going to understate what a bitter blow this is to the 3,500 skilled and dedicated workers at Honda in Swindon and their families, to the many more people and businesses who supply the plant, and to the town of Swindon, which has been proud to be home for 34 years to one of the best car factories in the world. It is a blow to the whole British economy.

The reason that Honda has given is its decision to accelerate the move to electric propulsion and to consolidate investment in its facilities in Japan. Following the entry into force of the EU-Japan free trade agreement earlier this month, tariffs for cars exported from Japan to the EU will drop from the current 10% to zero by 1 January 2026. Honda will then export from Japan, rather than from Britain, to Europe and the rest of the world. The company has stated that Bracknell will be retained as its European headquarters, that it will continue to base its Formula 1 operation from Britain, and that its research and development centre for electrification and connected and autonomous technologies will continue at Swindon.

Honda has announced an immediate consultation on the plan with the trade unions and suppliers. I have spoken with the trade unions, the local Members of Parliament, the leader of Swindon Borough Council and the chair of the local enterprise partnership. I will shortly chair, in Swindon, the first meeting of a taskforce, comprising those people and others, to do everything we can to ensure that the much valued Honda workforce in Swindon find new opportunities that make use of their skills and experience. We will work with the local community to ensure that Swindon’s justified reputation as a place of industrial excellence in manufacturing, technology and services is maintained and expanded.

In our automotive sector, we will work in close partnership with an industry that is going through a period of technological change and adjustment across the world that is greater than at any time in its history—a period of change that is disruptive and even painful for many, but in which Britain’s industry can emerge as a global leader if we back innovation in new sources of power and navigation. That is one of the four grand challenges of our industrial strategy, and the focus of our automotive sector deal.

I and many other colleagues in the House, of all parties, have worked hard over the past three years to make the case for investing in Britain, to investors in this country and around the world, despite the uncertainty that Brexit has put into the assessments of investors in Japan and around the world. We have secured investments during this time, from Nissan, Toyota, Geely, BMW, PSA, Aston Martin, Williams and many smaller firms. We have an international reputation for being a place to do business, with skilled, motivated staff, with access to innovation, especially in automotive, which is the best on the planet, and with a determination to make those strengths even greater in the years ahead.

This is a devastating decision that has been made today, and one that requires us to do whatever it takes to ensure that in the years to come Honda will once again, building on its continued presence here, recognise Britain as the best place in the world to build some of the best vehicles in the world.

Greg Clark – 2019 Statement on Wylfa Newydd Nuclear Project

Below is the text of the statement made by Greg Clark, the Secretary of State for Business, Energy and Industrial Strategy, in the House of Commons on 17 January 2019.

With permission, Mr. Speaker, I would like to make a statement following Hitachi’s announcement that they intend to suspend development of the proposed Wylfa Newydd new nuclear project, as well as work related to Oldbury.

Mr. Speaker, the economics of the energy market have changed significantly in recent years. The cost of renewable technologies such as offshore wind has fallen dramatically, to the point where they now require very little public subsidy and will soon require none. We have also seen a strengthening in the pipeline of projects coming forward, meaning that renewable energy may now not just be cheap, but also readily available.

As a result of these developments over the last eight years we have a well-supplied electricity market. Our electricity margin forecast is currently over 11% for this winter – having grown for each of the last five years.

Whilst this is good news for consumers as we strive to reduce carbon emissions at the lowest cost, this positive trend has not been true when it comes to new nuclear. Across the world, a combination of factors including tighter safety regulations, have seen the cost of most new nuclear projects increase, as the cost of alternatives has fallen and the cost of construction has risen. This has made the challenge of attracting private finance into projects more difficult than ever, with investors favouring other technologies that are less capital-intensive upfront, quicker to build, and less exposed to cost overruns.

But as I made clear to the House in June, this government continues to believe that a diversity of energy sources is a good way and the best way of delivering secure supply at the lowest cost, and nuclear has an important role to play in our future energy mix. In my June Statement I therefore reaffirmed the government’s commitment to nuclear. I also announced that we would be entering into negotiations with Hitachi over their project at Wylfa. Given the financing challenges facing new nuclear projects, I made clear to the House in June that we would be considering a new approach to supporting Wylfa that included the potential for significant direct investment from the government.

Mr. Speaker, while negotiations were ongoing, I am sure the House will understand that the details were commercially sensitive, but following Hitachi’s announcement I can set out in more candid terms the support that the government was willing to offer in support of the project. Firstly, the government was willing to consider taking a one third equity stake in the project, alongside investment from Hitachi and Government of Japan agencies and other strategic partners. Secondly, the government was willing to consider providing all of the required debt financing to complete construction. Thirdly, the government agreed to consider providing a Contract for Difference to the project with a strike price expected to be no more £75 per megawatt hour.

I hope the House would agree that this is a significant and generous package of potential support that goes beyond what any government has been willing to consider in the past. Despite this potential investment, and strong support from the government of Japan, Hitachi have reached the view that the project still posed too great a commercial challenge, particularly given their desire to deconsolidate the project from their balance sheet and the likely level of return on their investment.

Mr, Speaker, the government continues to believe that nuclear has an important role to play, but critically it must represent good value for the taxpayer and the consumer. I believe the package of support that we were prepared to consider was the limit of what could be justified in this instance. I was not prepared to ask the taxpayer to take on a larger share of the equity, as that would have meant taxpayers taking on the majority of construction risk and the government becoming the largest shareholder with responsibility for the delivery of a nuclear project. I also could not justify a strike price above £75 per megawatt hour for this financing structure, given the declining costs of alternative technologies and the financial support and risk sharing already on offer from the government which was not available for Hinkley Point C.

I would like to reassure the House that Hitachi’s decision to suspend the current negotiations on the project was reached amicably between all parties once it became clear that it was not possible to agree a way forward. Hitachi have made clear themselves that while they are suspending project development at this stage, they wish to continue discussions with the government on bringing forward new nuclear projects at both Wylfa and Oldbury and we intend to work closely with them in the weeks and months ahead. We will also continue to strengthen our long-standing partnership with the Government of Japan on a range of civil nuclear matters. And importantly, we will continue to champion the nuclear sector in North Wales, which is home to world-leading expertise in areas such as nuclear innovation and decommissioning, and offers ideal sites for deploying small modular reactors.

Mr Speaker, if new nuclear is to be successful in a more competitive energy market – which I very much believe it can be – it is clear that we need to consider a new approach to financing future projects, including those at Sizewell and Bradwell. As I initially set out in June, we are therefore reviewing the viability of a Regulated Asset Base model and assessing whether it can offer value for money for consumers and taxpayers. I can confirm to the House that we intend to publish our assessment of this method by the summer at the latest.

Through our nuclear sector deal, we are also exploring working with the sector to put the UK at the forefront of various forms of nuclear innovation. We are therefore exploring whether advanced nuclear technologies, such as small modular reactors, could be an important source of low carbon energy in the future and are considering a proposal from a UK Consortium led by Rolls Royce that would result in a significant joint investment.

Finally, I started this statement by outlining the challenges that the nuclear industry faces as the energy market changes. I will set out a new approach to financing new nuclear as part of the planned Energy White Paper this summer. I know the future of the nuclear sector is of great interest to many Members of this House and I will ensure that Members across this House, and its Select Committee, have the opportunity to consider the proposals.

Mr. Speaker, I understand the disappointment the dedicated and expert staff at Wylfa and Oldbury will feel as a result of today’s announcement by Hitachi. New commercial nuclear investments around the world over are experiencing the same challenges as new sources of power become cheaper and more abundant.

Nuclear has an important role to play as part of a diverse energy mix, but must be at a price that is fair to electricity bill payers and to taxpayers. We will work closely with Hitachi and the industry to ensure that we find the best means of financing these and other new nuclear projects. And our commitment to Anglesey – with nuclear, renewables, and the deep expertise that it has, a real island of energy – will not be changed by this decision. I will work with the member for Ynys Môn, the Welsh Government and the local community to ensure its renown is supported and strengthened, and I will do the same with my Honourable Friend the Member for Thornbury and Yate.

I would like to pay tribute to the staff of Horizon, Hitachi and to my own officials and those of in the Department of International Trade and the Government of Japan, who have spent many months doing their utmost to support a financing package. I know that they left no stone unturned in seeking a viable commercial model for this investment and I very much hope that their work and professionalism will lead to a successful partnership following this period of review.

I commend this statement to the House.

Greg Clark – 2019 Speech at Launch of the New Toyota Corolla

Below is the text of the speech made by Greg Clark, the Secretary of State for Business, Energy and Industrial Strategy, on 14 January 2019.

Hiroki Nakajima, Ambassador, ladies and gentlemen, it is a huge honour and a pleasure to be here to celebrate this success. Dr van Zyl referred to the decision to invest in TNGA. That was a thrilling moment to have that vote of confidence in the future, building on the success of over a quarter of a century of achievements here in Derbyshire.

But it is a particular pleasure to be able to meet team members on the line to see it now going into production and making cars that will be sold not just in this country but around the world. And it is fitting that you have invited what I like to think of as team Toyota here from the plant, from the local community and right across the country and we are all delighted at your success and are determined to make sure it can power forward in the future.

Now the Corolla of course is a historic car. This is a historic moment for a historic car. When it was launched in 1966, it was launched with these words, that it was “The most wanted car by the market – presented to the world by bringing together the essence of Toyota’s technology”. And what we see today through this investment is that those values and those traditions continue.

Right from the outset, it was the Corolla that brought sports car technology to the school run if I can put it that way. It was the first family car with front brake discs. It was the first Japanese car with a floor-mounted gear lever. And the first Japanese car with a 4-speed fully-synchronised manual transmission. Britons, when it was first launched, could own a piece of the future, and this is as true now as it was then.

The Corolla that we are celebrating today is a fitting heir to this tradition of continuing innovation. And as we move into the era of clean technology, the facts that the hybrid technology pioneered by Toyota is being produced here in Derbyshire, and of course in Deeside in North Wales, is a tremendous source of pride to all of us in the United Kingdom.

2,600 people work here, members of Toyota work force here onsite and 600 more in Deeside. But of course, we know that beyond the factory gates so many partners are part of this success and I know that many of them are represented here today. I just wanted to refer to and pay tribute to those who may not have the Toyota brand but are very much part of that success. Adient who supply seats for the vehicles just down the road in Burton-Upon-Trent. I think Garry Linnett is here from Aisin who produce panoramic car roofs. This fantastic innovation that’s going to be appreciated for those endless summer days that we look forward to in the UK.

Kevin Schofield, I think is here from Futaba who produces the weld and sub-assembly parts, and seeing all of these parts come in at short notice, and seeing them so brilliantly deployed in these vehicles, is a real demonstration of the power of the model that Toyota has pioneered and has taught much of the rest of British manufacturing.

So, this has always been a successful partnership. We have drawn and learnt much from Toyota’s presence here. We think this has been a successful joint-collaboration over the years and we are thrilled that it is moving to the next stage.

Dr van Zyl reflected the importance of having those conditions that have been central to success. Having a skilled, dedicated and motivated workforce that we have in abundance here and you always will. But also, to make sure we recognise the importance of public policy that is supportive and backs investments like this. We should be able to continue to trade without introducing any of those frictions that would disrupt what is a perfect process that has been optimised here.

I hear that very strongly. Over the years, the evidence that has been presented by Toyota and other firms within the advanced manufacturing sector in the UK has been instrumental in determining the kind of relationship that we want.

In these days ahead, I will continue to be a strong advocate for that kind of relationship which has been so crucial to our success.

Toyota has done the country a service, in bringing to life the benefits and the actuality of just-in-time production of advanced manufacturing and the benefits that there are to all. We are very grateful for that and we give this commitment; we will always back you, we will always celebrate your success, and we will always listen to you, and to act on what you need to prosper in the future.

Today’s a fantastic day of celebration. It is a huge honour to have been asked to be part of it. Thank you very much indeed for inviting me. I’d like to hand over to the ambassador.

Greg Clark – 2018 Statement on Energy Policy

Below is the text of the statement made by Greg Clark, the Secretary of State for Business, Energy and Industrial Strategy, in the House of Commons on 17 May 2018.

The Secretary of State for Housing, Communities and Local Government, my right hon. Friend the Member for Old Bexley and Sidcup (James Brokenshire) and I wish to reiterate the Government’s view that there are potentially substantial benefits from the safe and sustainable exploration and development of our onshore shale gas resources and to set out in this statement to Parliament the actions we are taking to support our position. This joint statement should be considered in planning decisions and plan making in England.

The UK must have safe, secure and affordable supplies of energy with carbon emissions levels that are consistent with the carbon budgets defined in our Climate Change Act and our international obligations. We believe that gas has a key part to play in meeting these objectives both currently and in the future. In part as a result of the UK’s diverse range of energy sources, which include natural gas, we have had competitively priced energy since 1990 while reducing carbon emissions across the economy by 49%—a leading performance among developed nations. Gas still makes up around a third of our current energy usage and every scenario proposed by the Committee on Climate Change setting out how the UK could meet its legally binding 2050 emissions reduction target includes demand for natural gas. As set out in the clean growth strategy, innovations in technologies such as carbon capture usage and storage (CCUS) have the potential to decarbonise this energy supply still further and prolong its role in our energy mix.

However, despite the welcome improvements in efficiency and innovation from companies operating in the North sea, the ongoing decline in our offshore gas production has meant that the UK has gone from being a net exporter of gas in 2003 to importing over half (53%) of gas supplies in 2017 and estimates suggest we could be importing 72% of our gas by 2030. Our current import mix, via pipelines from Norway and continental Europe and LNG terminals that can source gas from around the world, provides us with stable and secure supplies. However, we believe that it is right to utilise our domestic gas resources to the maximum extent and exploring further the potential for onshore gas production from shale rock formations in the UK, where it is economically efficient, and where environment impacts are robustly regulated.

We also believe that further development of onshore gas resources has the potential to deliver substantial economic benefits to the UK economy and for local communities where supplies are located by creating thousands of new jobs directly in extraction, local support services, and the rest of the supply chain. A potential new shale gas exploration and production sector in the shale basins of England could provide a new economic driver. We also see an opportunity to ​work with industry on innovation to create a “UK Model”—the world’s most environmentally robust onshore shale gas sector—and to explore export opportunities from this model, a core theme of our modern industrial strategy.

But to achieve these benefits, we need to work with responsible companies prepared to invest in this industry as they proceed with the exploration process, to test the size and value of the potential reserves and to ensure that our planning and regulatory systems work appropriately while assisting local councils in making informed and appropriate planning decisions. So we are setting out a series of actions, including those committed to in the Government’s 2017 manifesto to support the development of shale gas extraction.


The UK has world-class regulation to ensure that shale exploration can happen safely, respecting local communities and safeguarding the environment. The development of the shale gas industry so far has already led to millions of pounds being invested in the UK, supporting businesses and the supply chain, and creating British jobs. We have recently seen four planning approvals for exploratory shale development. The Government remain fully committed to making planning decisions faster and fairer for all those affected by new development, and to ensure that local communities are fully involved in planning decisions that affect them. These are long-standing principles. No one benefits from the uncertainty caused by delay which is why, in September 2015, Government set out a range of measures to help ensure every planning application or appeal was dealt with as quickly as possible.

However, recent decisions on shale exploration planning applications remain disappointingly slow against a statutory time frame of 16 weeks where an environmental impact assessment is required. So we are announcing a range of measures to facilitate timely decisions. These measures only apply in England.

Planning policy and guidance

This statement is a material consideration in plan making and decision taking, alongside relevant policies of the existing national planning policy framework (2012), in particular those on mineral planning, including conventional and unconventional hydrocarbons.

Shale gas development is of national importance. The Government expect mineral planning authorities to give great weight to the benefits of mineral extraction, including to the economy. This includes shale gas exploration and extraction. Mineral plans should reflect that minerals resources can only be worked where they are found, and applications must be assessed on a site by site basis and having regard to their context. Plans should not set restrictions or thresholds across their plan area that limit shale development without proper justification. We expect mineral planning authorities to recognise the fact that Parliament has set out in statute the relevant definitions of hydrocarbon, natural gas and associated hydraulic fracturing. In addition, these matters are described in planning practice guidance, which plans must have due regard to. Consistent with this planning practice guidance, policies should avoid undue sterilisation of mineral resources, including shale gas.​
The Government have consulted on a draft revised national planning policy framework (NPPF). The consultation closed on 10 May 2018. In due course the revised national planning policy framework will sit alongside the written ministerial statement.

We intend to publish revised planning practice guidance on shale development once the revised national planning policy framework has been launched ensuring clarity on issues such as cumulative impact, local plan making and confirmation that planners can rely on the advice of regulatory experts.

Planning decision making

To support a decision-making regime that meets the future needs of the sector we will progress our manifesto commitments by:

Holding an early-stage consultation, in summer 2018, on the principle of whether non-hydraulic fracturing shale exploration development should be treated as permitted development, and in particular on the circumstances in which this might be appropriate.

Consulting, in summer 2018, on the criteria required to trigger the inclusion of shale production projects into the nationally significant infrastructure projects regime.

Further, we will strengthen community engagement by consulting in due course on the potential to make pre-application consultation a statutory requirement.

Support for those involved in decision making

We are aware that the shale applications and the planning process can be complex for local authorities. Building capacity and capability within local authorities to deal with shale development is a vital step towards speeding up decision making. We will help achieve this by announcing today:

The launch of a new £1.6 million shale support fund over the next two years to build capacity and capability in local authorities dealing with shale applications.

The creation of a new planning brokerage service for shale applications to provide guidance to developers and local authorities on the planning process to help facilitate timely decision making. The service would focus exclusively on the planning process and will have no role in the consideration or determination of planning applications. The service will not comment on the merits of a case and will also have no role in the appeals process.

In addition, the Government recognise that early engagement with local authorities, including capitalising on formal pre-application discussions, is critical in building confidence in decision making and securing support for development proposals and set realistic timeframes for decisions. We expect this to be formalised by a planning performance agreement providing certainty for all parties. And we then expect all parties—including decision makers in local authorities—to stick to the timetable.

Opportunities for redress

While we are confident that the measures announced in this written ministerial statement will speed up decision making on shale applications, we cannot be complacent. Therefore:

We will continue to treat appeals against any refusal of planning permission for exploring and developing shale gas, or against any non-determination as a priority for urgent determination by the planning inspectorate, making additional resources available where necessary.

Under the written ministerial statement in 2015 the criteria for recovering planning appeals were amended to include proposals for exploring and developing shale gas. This was applied for a two-year period subject to further review. ​The Secretary of State for Housing, Communities and Local Government has conducted a review and remains committed to scrutinising appeals for these proposals. We are therefore announcing that the criteria for considering the recovery of planning appeals are continued for a further two years. The new criterion is added to the recovery policy of 30 June 2008, Official Report, column 43WS.

The Secretary of State for Housing, Communities and Local Government will actively consider calling in shale applications particularly where statutory deadlines have been exceeded. Each case will be considered on its facts in line with his policy. Priority timeframes for urgent determination will be given to any called-in applications.

The Government continue to commit to identifying underperforming local planning authorities that repeatedly fail to determine oil and gas applications within statutory timeframes. When any future applications are made to underperforming authorities, the Secretary of State will consider whether he should determine the application instead.

Shale Regulator

The UK regulatory regime for shale gas is considered among the most robust and stringent in the world. However, we acknowledge that it is also complex, with three regulators, the Environment Agency, the Health and Safety Executive and the Oil and Gas Authority, all with responsibilities for regulation. It is not always transparent to both the public and industry who is responsible for what. Therefore, the Government are setting up a shale environmental regulator which will bring the regulators together to act as one coherent single face for the public, mineral planning authorities and industry. We intend to establish the regulator from the summer.

We anticipate that the plans for the shale environmental regulator and future consultations will only apply in England.

Community Benefits

We strongly believe that communities hosting shale gas developments should share in the financial returns they generate. The Government welcome the shale gas companies’ commitment to make set payments to these communities, which could be worth up to £10 million for a typical site. Actions to support local communities are an important complement to the planning actions set out above. With that in mind, we want to go further, and we will work with industry to see how we can improve this offer.

In addition to this offer we also announced in the autumn statement 2016 that the shale wealth fund will provide additional resources to local communities, over and above industry schemes and other sources of Government funding. Local communities will benefit first and determine how the money is spent in their area.

Greg Clark – 2018 Speech on Energy Cap

Below is the text of the speech made by Greg Clark, the Secretary of State for Business, Energy and Industrial Strategy, in the House of Commons on 26 February 2018.

We will today introduce the Domestic Gas & Electricity (Tariff Cap) Bill to this House.

We are taking this action because the energy market is not working for all customers. The Competition and Markets Authority 2016 investigation into the energy market highlighted that domestic customers of the Big 6 energy companies pay on average £1.4 billion a year more than they would in a truly competitive market.

We believe that competition is the best way to drive value and service for customers. Where this is not happening, the government has a duty to act by ensuring regulation is effective and companies have the right incentives to provide value.

The energy market is not working for all consumers.

There is in effect a two-tier market in operation whereby active customers save money by switching suppliers, but those who can’t or don’t switch remain on poor value tariffs. It is of particular concern that customers who don’t switch typically tend to be more vulnerable than those who are getting the best deals. The difference between the cheapest available tariff and the average Standard Variable Tariff of a Big 6 supplier is around £300.

Earlier this month, one million more vulnerable consumers who receive the Warm Home Discount were protected from higher bills with the extension of Ofgem’s safeguard tariff cap. There are now 5 million households protected by this cap which was introduced in 2017.

The Domestic Gas and Electricity (Tariff Cap) Bill will, subject to Parliamentary approval, put in place a requirement on the independent regulator, Ofgem, to cap domestic energy tariffs until at least 2020. Currently, some consumers are paying up to £300 more than they need to – this cap will help bring this overcharging under control. It will require Ofgem to set an absolute cap on standard variable and default tariffs, protecting the 11 million households in England, Wales and Scotland who currently buy their energy on this basis and who are not protected by existing price caps.

The Bill is part of a package of measures being introduced by the government to increase competition in the retail energy market and lower prices for consumers. These include support for more and faster switching, initiatives to improve engagement and the rollout of smart meters. We believe all of these measures will help create the conditions for more effective competition.

In setting the cap, Ofgem must protect existing and future domestic customers, but must do so in a way that creates incentives for suppliers to improve efficiency, sets the cap at a level that enables suppliers to compete effectively for supply contracts, maintains incentives for customers to switch and ensures that efficient suppliers are able to finance their businesses. The government intends Ofgem to be able to set the temporary price cap by the end of this year so that it is in place by next winter.

The cap will apply until the end of 2020 when Ofgem will recommend to government whether it should be extended on an annual basis up to 2023.

The introduction of the Domestic Gas and Electricity (Tariff Cap) Bill comes after the Business, Energy and Industrial Strategy Select Committee scrutinised the draft Bill as part of the government’s work to ensure the Bill would be effective and would meet its objectives. This pre-legislative scrutiny took written and oral evidence from a wide range of stakeholders. The Committee made a number of recommendations about the Bill, which the government has accepted in full, including the Committee’s recommendation that Ofgem reviews the level at which the cap is set at least every 6 months, and the recommendation to add in safeguards so that where consumers make an active choice to opt for green standard variable tariffs or default tariffs, Ofgem is able to protect these customers but not stifle investment in green energy. Ofgem will also be required to consult on a potential exemption for green tariffs.

This Bill will give the regulator the powers to protect those consumers who are overpaying for energy, while ensuring that other initiatives such as switching, smart meter roll out and consumer education continue to contribute to a more competitive market.

Greg Clark – 2018 Speech at NFU Conference

Below is the text of the speech made by Greg Clark, the Secretary of State for Business, Energy and Industrial Strategy, at the NFU Conference on 21 February 2018.

Ladies and Gentlemen,

It’s great to be with you today. Thank you for inviting me.

It is a great honour to be here for the first time at a National Farmers Union (NFU) Conference.

As someone who has known all my life that farming is foundational not just to our economy, but to our country, it is a particular privilege to be here.

Providing the food and drink we live on and stewarding the countryside that is so much part of our national and local identity means there is no more essential industry.

As Guy said, I was born and raised in the food and drink business with my father and grandfather’s retail dairy delivery round supplying our neighbours in Middlesbrough with fresh Yorkshire milk seven days a week.

When I talk about agriculture as an ‘industry’ that’s not to ignore the fact that farming and growing is more than just a sector of the economy. It’s a life. And its all-consuming.

I was glancing through Farmers Weekly before Christmas and there was an interview with a young farmer from Wales called Tom Parry.

The journalist asked him: “If you won the lottery… what’s the first thing you would spend the money on?”

His reply? “More sheep.” But food and farming is an industry nonetheless and as Guy alluded to before, it’s one of our greatest.

The agricultural sector is the biggest manufacturing sector in the UK. Employing almost four million people and larger than the automotive and aerospace sectors combined.

And what that means in my view is that it deserves the same seriousness of engagement with all parts of government about the future that other successful industries like aerospace, automotive can count on, like life sciences and financial services expect to get with government.

And for your unique role in stewardship and in feeding the nation, like any industry, you need to be profitable and we need to help make sure the right conditions exist right for investment in the future.

Now, of course, you have a government department dedicated to farming and rural affairs and it is headed by one of the most innovative and effective Secretaries of State in government.

But I’m determined, with Michael, that you should participate fully just as other industries do in the work that is being done by the whole of government.

Including my department, the Business Department, as we work together to make Britain more prosperous in the future.

I think we need to do a better job in emphasising the centrality of agriculture to our economy and to our economic future.

If proof were needed of that, it can be found in the most recent agricultural exhibition in the London Science Museum.

This started off with farming in the Iron Age and ended somewhere around 1952. 1952?

That’s 15 years before I was even born. Imagine if the space exhibition ended in 1952. You’d miss all the good stuff.

No moon landings. No space shuttle. No International Space Station. It’s the same with farming.

So it’s fantastic that the Science Museum is planning a new £3 million exhibition to show the real face of modern British agriculture to the whole country and especially to the rising generation of people who may not have the knowledge or experience of agriculture, which should open later this year.

I don’t know who farming’s Tim Peake is but it’s very important that the place of this industry at the forefront of innovation should be there.

Because this is one of the most innovative of our industries and we need to ensure that the next generation need to see the opportunities for earning and advancement there are in a career in food and farming.

And I think it is also important that other industries need to see that agriculture is a source of ideas that can drive new ways of working and using technology in their own sectors.

There is a great translation and diffusion of learning across adjacent industrial sectors and I think we underplay the opportunities from the innovations that you have made into other industrial sectors.

That’s why I was determined to place food and farming at the heart of our Industrial Strategy, both for this sector and because of the relevance to sectors across the economy.

And why I’m so thrilled with the contribution and enthusiasm of so many people in this room. Of course the NFU, to the Country Land and Business Association (CLA), the Food and Drink Federation and so many others.

The challenge for our Industrial Strategy is the same challenge for this sector. How can we become more productive and so more prosperous.

I want to commend the excellent work that Tom Hind of the Agriculture and Horticulture Development Board (AHDB) has been carrying out on productivity in this sector. It has uncovered that since the mid-1990s productivity growth in agriculture and horticulture has fallen behind our principal competitors.

In fact, it has grown at just one-third of the rate enjoyed by the Netherlands and the USA. Relatively slow growth in productivity in recent years has characterised much of the British economy.

The Industrial Strategy set out a number of ways in which with a sustained national effort we can improve productivity.

It seems to me they are relevant to this industry as much as others.

The first is innovation.

This is one of the most innovative sectors of our economy and the advantages of bringing together our best scientists with our most forward-thinking producers, is clear.

I think most people would agree that the agri-tech strategy which launched five years ago has proved a success.

The Catalyst, for example has helped fund projects fighting diseases in pigs, rearing lobsters off the Cornish coast and improving the efficiency of Strawberry production, to name but a few.

But there is great potential for much more and so the Industrial Strategy commits to the biggest ever increase in public research and development investment. An extra £3 billion a year by 2021.

It brings in a focus on four Grand Challenges, technological changes sweeping across the world in which Britain has a leading position.

I am committed to making sure that agriculture plays a big role in many of these.

One of these is Artificial Intelligence and the analysis of big data.

Intelligent algorithms using data on atmospheric conditions and soil moisture has the real potential to dramatically reduce, for example the water needed for agriculture.

Michael Gove and I have agreed that agricultural technology will be one of the priority sectors for the new Office of Artificial Intelligence announced in our Industrial Strategy.

Through our Grand Challenges on the future of mobility, we know right around the world the way we are transporting ourselves, the way vehicles are powered and how we are connecting ourselves is changing, and we want to make Britain the go-to place in the world for the development of new autonomous vehicles.

I am determined this won’t just be the vehicles you see on our road, and that agriculture will be a big part of that.

Through the Hands-Free Hectare project Harper Adams University and York-based company Precision Decisions are planting, tending and harvesting crops using only autonomous vehicles and drones.

This project was funded through Innovate UK and was the first in the world to farm a crop in this way.

So I have insisted that our Connected and Autonomous Vehicles programme is making funding available to off-road driverless innovation, with a particular application to agriculture.

And yet another challenge – in this country – we’ve often been better at the invention and discovery of new ways of doing things that the implementation of them.

The AHDB was right in saying we need to put an increased emphasis on the ‘D’ in R&D, the development half of research and development.

As part of the Industrial Strategy, we announced a Transforming Food Production Challenge. And I’m delighted to announce today that the government will invest £90 million to make this challenge a reality.

It will include the creation of ‘Translation Hubs’ bringing together farmers and growers, businesses, scientists, and Centres for Agricultural Innovation, to apply the latest research to farming practice.

It should be a big boost to the knowledge exchange that already takes place across food and farming. And with the technological revolution that is happening the skills of the farming workforce need to keep pace.

New technologies require new abilities. Today’s modern British farmer is a Swiss-Army-Knife of skills.

An engineer, an environmentalist, a data scientist, a biochemist, often an energy producer, a tourism entrepreneur, and always an investor too. All of these skills are essential to the jobs that you do.

Yet at the moment, we under-invest in skills and training relative to many of our competitor countries.

And if we are to take advantage of the productivity improvements that technology offers we need to have tailored programmes of skills, education and training to meet the needs of sectors, as well as more farmer-to-farmer learning, to demonstrate what works in practice.

The Industrial Strategy emphasises new T-Levels which will provide an important opportunity for a new generation to start their careers in agriculture with relevant skills and we will work closely with the NFU to make them effective.

Apprenticeships will be a crucial part of this. And our reforms to apprenticeships are intended to present high quality opportunities for individuals and employers alike.

These reforms are some of the most substantial the government has ever made. But they are still young, and we are listening to feedback as the programme develops.

I also hear loud and clear, the challenges you are experiencing in your workforce currently.

As a West Kent MP, the Hoppers huts that can still be found in the fields around our coasts are a reminder that agriculture has always relied on seasonal workers whether from home or abroad.

In particular, two-thirds of your workers born outside of the UK come from the EU. This is an absolutely crucial component that I know Michael Gove touched on yesterday.

And as we move to a new relationship with the EU it is essential that you can get the workers you need.

‘A secure supply of skilled and seasonal labour’, is one of eight priority areas for our new Food and Drink Sector Council that has been created as part of our Industrial Strategy.

That clear focus and commitment to make sure you get what you need to do the important job that you have, is vital. And the purpose of forming the Council is to not just talk about the issues, but to act on its advice.

Upgrading our infrastructure is another way in which we can help improve productivity and as Guy mentioned earlier, I cannot recall an occasion on which I met the NFU branch in which the need for considerably better broadband and mobile coverage was not top of the list of improvements required.

Michael was emphatic on it yesterday and I completely share his view. The imperative becomes even more pressing because many of the technologies that can transform agricultural productivity and things like Artificial Intelligence rely on the fast transformation of large quantities of data. It is becoming more important than ever.

The Industrial Strategy commits an extra £200 million of investment in the Local Full-Fibre Networks Programme. As Michael said yesterday, 95% of the UK population can now access superfast broadband, a target which was reached last December.

As is evidence, there is much further to go, including making super fast high-speed broadband a legal right to everyone.

There is perhaps no industry in Britain in which local industry and the distinctiveness that one place has from another is as intrinsic as in farming.

My longstanding view is that government policy has been too uniform in failing to take opportunities to recognise that what is needed for a northern city or a place like Birmingham to maximise its potential will be very different for a rural county.

And around the world, we see that one of the most successful ways in which productivity grows is through clusters of adjacent businesses with particular local relevance each reinforcing the other.

We see it all, from life sciences in Cambridge to elite motor manufacturing in Northamptonshire. Successful clusters attract ambitious followers creating expertise and jobs.

Through institutes such as FERA outside York, which I know very well, to the Wellcome Trust’s Sanger Institute outside Cambridge, I think there are huge opportunities to gather businesses that can make the most of the proximity of our resources.

A big part of our Industrial Strategy is to do what I know virtually everyone in this room does, and be leaders and participants in their local economies and to give more power to invest locally in other sectors and other industries, helping make the most of local opportunities.

Finally, strengthening relationships are vital if we are to capitalise on the individual strengths of the sector.

Food and farming has always been a diverse and some would say fragmented, sector. But that is not to say that the opportunities that come from working together don’t exist. In fact I think they are more plentiful in this sector than many others.

The supply chain from farm to fork and indeed into farms is a crucial source of quality competitiveness and innovation.

Fragmentation compared to other sectors simply emphasises the need to make a deliberate effort to come together effectively.

That’s why I’m delighted that the new Food and Drink Sector Council met for the first time last month. I know Michael Gove spoke about this yesterday.

It brings together government departments, farmers and growers, food and drink manufacturers the logistics industry, hospitality industry, retailers and others with a stake in a flourishing sector.

I’d like to thank Sir Peter Kendall for representing the voice of farmers on the Council and its working groups.

One of the Council’s early tasks is to propose a Sector Deal to drive forward each aspect of the Industrial Strategy as it reflects food and drink: innovation, skills, infrastructure investment, building up local strengths and getting the right business environment for start-ups and for growing businesses. Each one of these pillars of our Industrial Strategy, I’m absolutely determined will apply to the food and drink sector and should be represented in a strong and ambitious Sector Deal.

I take it personally. Michael Gove and I will jointly lead for the government on negotiating this deal. I want this to be a totemic deal that shows to sectors that perhaps have not considered food and farming and agriculture to be part of the economic future of our country, in the way that it so clearly is.

And I hope it will be a beacon to the British industry and the rest of the world that British agriculture is mustering its considerable strength to seize the opportunities before us.

So ladies and gentlemen, Thank you for inviting me to be with you today.

When I first set to thinking about the Industrial Strategy I had a clear vision that this strategy must be for the whole of our economy and for the whole of Britain. And so agriculture one of our largest and most innovation-rich industries had to be at the heart of it.

I am so thrilled at the positive response that it has received from farmers, growers and those engaged in food production.

And whether it is spreading innovation or building a workforce with the skills of the future. These are vital steps. Not all these steps can be taken all of them overnight.

A short term strategy, after all, is a contradiction in terms.

But I strongly believe that by acting deliberately now we can act together to create the future of farming.

Thank you very much indeed.

Greg Clark – 2018 Speech at Manufacturing Conference

Below is the text of the speech made by Greg Clark, the Secretary of State for Business, Energy and Industrial Strategy, at the EEF Manufacturing Conference on 19 February 2018.

Ladies and gentlemen,

There is a manufacturing renaissance gathering pace in Britain today.

With the right support, it can transform not just the prospects of the British economy but the lives of a new generation of men and women for whom a career in engineering will be part of a revolution in the way the world lives.

Because from how we travel to how we generate power.

From technologies that help detect and diagnose diseases to processes that cure them.

From machine learning to new outlets for human creativity.

The transformations that the world is going through are areas where British capability is renowned.

Earlier this month I opened a new manufacturing facility near Oxford for a company called YASA Motors.

It will produce 100,000 electric motors a year. Cutting the ribbon I was standing next to a vehicle powered by YASA Motors.

A hybrid C-X75 built by Jaguar Land Rover whose Chief Executive Ralf Speth is here tonight.

It’s a car with the speed of a Bugatti Veyron and the emissions of a Toyota Prius.

An astonishing example of British innovation and British manufacturing genius.

But, because the motor is just one component of a complex product you could be forgiven for not knowing about it.

And it is a problem that too few people know how successful British engineering is and what opportunities there are within it.

For about 40 years now, too many young people in schools have been put off a career in manufacturing by a tacit, but pervasive, assumption that this was a sector in decline.

That prospects were waning and jobs would be uncertain.

That things would be made overseas and not here in the UK.

That if you were bright and ambitious you should think about other sectors, not engineering.

Well, that couldn’t be more wrong.

We are not experiencing the end of engineering but its rise to primacy.

The domination of design, engineering and technology into every aspect of commercial and consumer life from food production to retailing to healthcare.

And we are already experiencing the benefits.

At the end of 2017, UK manufacturing output was at its highest level for 10 years with the longest run of sustained growth for 20 years.

Employment in manufacturing is on the rise and from conversations I’ve had with many people in this room would rise further if only you could lay your hands on enough people with the skills you need.

We know, as a nation, that to be more prosperous we have to raise productivity and you in this room show how it can be done.

Productivity in manufacturing rose four times faster than the economy as a whole over the last decade.

At this time of growth for engineering I am determined that your government must be activist in helping you seize the opportunities it presents.

To do that we need to listen to what you say and act on it.

So let me respond directly to Judith Hackitt’s 3 challenges:

– Brexit
– Industrial Strategy
– Skills


First, Brexit.

The first requirement for business is an agreed transition deal.

The EEF, under Terry Scuoler’s leadership was instrumental in making the case for the implementation period.

And every Wednesday morning I meet your new Chief Executive Stephen Phipson and other business leaders.

The unambiguous view of businesses – large and small is that there must be no sudden change.

And that businesses must have around 2 years to prepare for our new relationship.

This is what was the Prime Minister committed to in her Florence Speech and it is what was agreed in the joint report with the EU in December.

During this period business wants to count on continuity rather than endure a double change.

So during this time firms of all sizes, will still be able to trade with the EU in the same way, as now.

The rules and standards that govern that trade will apply, as now.

EU citizens will still be able to work in the UK, as now.

And if, as I believe will be the case, this is formally agreed next month that continuity will be available for around 3 years from now.

But I also hear loud and clear from business that an implementation period is necessary but not sufficient.

As Judith said, “ultimately, we need clarity and certainty”.

And I agree with those who say that ultimately what businesses need is clarity and certainty of a good deal.

We could have total clarity and certainty tomorrow if we chose to duck the job of getting into weeks of difficult negotiations and opted instead for exit on default WTO terms.

That is not, in my experience the clarity that business wants.

Instead, I believe we need to take the approach of building a good deal.

Building this good deal will mean:

– testing proposals with our counterparties and assessing the response
– harnessing the insights and understanding that come from good personal relationships
– making adjustments and exploring common ground

What do we want to achieve in that good deal?

The ability to trade with a now growing European market without tariffs or complex customs requirements.

And having confidence that non-tariff barriers like regulatory and product standards won’t be used to exclude us.

In so many areas, the UK sets the standard on standards.

Our expertise and rigour is renowned around the world and we want to keep British experts influential in international and European standards organisations wherever it makes sense to do so.

We are determined that taking back control should not mean giving up our influence.

And – of course, modern manufacturing depends on thrives on complex and specialist supply chains in which your products are the accumulation of products from all over Europe.

If you believe, as I do, that British manufacturing has a golden period ahead of it, then it follows that its ability to continue unhindered is foundational.

Brexit isn’t the only area in which the government and manufacturers need to work in partnership.

Industrial Strategy

It is crucial to our Industrial Strategy.

The new, independent Industrial Strategy Council will do precisely that:

– set the metrics
– measure progress
– report publicly on that progress; and
– make recommendations to government

And let me say just a word about the objective of our Industrial Strategy.

At a time when new technologies are creating new industries, changing existing ones and transforming the way we live our lives. And when Britain has an outstanding position in so many of them we would be crazy not to prepare ourselves to seize the opportunities of the future.

To help with this our Industrial Strategy sets out 4 Grand Challenges

– AI and the data-driven economy
– clean growth
– the future of mobility; and
– meeting the needs of an ageing society

Now – we need Britain’s public and private sectors our outstanding businesses and universities to join forces and lead the world in seizing these opportunities.

It’s backed by the biggest increase in public R&D investment this country has ever seen.

Three billion pounds more invested every year by 2021 to build on our reputation for excellence.

But we don’t want to do what we’ve done too much in the past.

Come up with the ideas here and then see these applied and developed elsewhere.

One of the tests of the use of this money is to see the impact on manufacturing here in the UK.

It’s why as part of our Faraday Battery Challenge we’re working with industries to build a Battery Manufacturing Development facility in the West Midlands.

And it’s not all about the brand new.

There are so many practices and techniques that the best performing companies in Britain employ that can be spread more widely through supply chains.

I was chatting to John Neill from Unipart earlier.

When I visited their HQ recently the sign on the door said:

Join the productivity revolution.

That’s what the Made Smarter Review led by Juergen Maier of Siemens has set out: how we can diffuse good practice throughout manufacturing.

I’d like to thank Juergen for his personal leadership of this.

It is brimming with ambition to create 175,000 new manufacturing jobs and raise productivity by a quarter.

We’re backing his analysis.

We need to do more to spread innovation.

So I am delighted that we will set up a Made Smarter Commission and I have asked Sir Mark Walport, Chief Executive of UK Research and Innovation, to work with Juergen Maier on the development of an Industrial Strategy Challenge on the digitalisation of our manufacturing industry as Mark previously did for the Faraday Challenge.


But if Britain’s manufacturers are to lead the world they’ll need people with the right skills.

Last November I visited EEF’s Technology Training Centre in Aston.

There, I met apprentices learning about robotics, smart factories and Computer-Aided Design.

EEF does some stellar work with young people including providing apprenticeships for companies like Mondalez who are here tonight.

The reforms to apprenticeship are the largest government has ever made and they are still young but we need to make sure the programme achieves all its aims.

We will listen to you and continue to work with you on how the Levy can spent so that it works effectively for industry.

And – crucially – so that it supports productivity growth.

But there’s another crucial challenge we still need to overcome.

So many of you here tonight have one thing in common.

You’re engineers.

Yet today, at the exact moment we need the next generation of engineers to help develop tomorrow’s technologies we’re facing a shortage.

We need to seize 2018 – the Year of Engineering to dispel some of the myths around this profession like the ones I mentioned earlier.

Part of the answer is about showing our young people the true faces of modern manufacturing. People right here in this room.

So let’s tell them how – on Deeside Toyota produce a new engine every 57 seconds.

How – In Hull, Siemens are building wind turbine blades as long as six double-decker buses.

And how – In Stevenage, Airbus Space and Defence built a spacecraft, which travelled nearly 4 billion miles to land a probe on a comet.

Above all – let’s send a clear message that whatever part of the UK you’re from there’s an amazing engineering story right on your doorstep.

Making things runs in our veins.

Again and again, the UK has literally manufactured the future.

The light bulb, the passenger railway, the CT scanner, graphene, the lithium-ion battery, the list goes on and on.

I’m an optimist.

I truly believe that there’s no problem that can’t be solved by the ingenuity of our engineers.

And no product that can’t be made by the sheer determination of our manufacturers.

So let’s harness the unbridled brilliance of Britain’s makers.

As we put into practice a modern Industrial Strategy for modern British manufacturing.

And let’s make the technologies the rest of the world will use tomorrow right here in the UK.

Thank you.

Greg Clark – 2018 Statement on Energy Policy

Below is the text of the statement made by Greg Clark, the Secretary of State for Business, Energy and Industrial Strategy, to the House of Commons on 11 January 2018.

The UK has benefited from its membership of the European Atomic Energy Community since joining the EU and Euratom in 1973. The Government’s ambition is to maintain as many of these benefits as possible through a close and effective association with Euratom in the future, after the UK withdraws from Euratom, at the same time as withdrawing from the EU, on 29 March 2019. Our plans are designed to be robust so as to be prepared for a number of different scenarios including the unlikely outcome that there is no future agreement at all. Our number one priority is continuity for the nuclear sector.

Since the 1950s, when the UK launched the world’s first nuclear power station, this country has been a leading civil nuclear country on the international stage, with deep nuclear research and nuclear decommissioning expertise, and with nuclear power playing a vital part in our electricity generation mix. It is vitally important that our departure from the EU does not jeopardise this success, and it is in the interests of both the EU and the UK that our relationship should continue to be as close as possible. We recognise and understand the concerns that the nuclear industry has raised. We agree it is essential that projects and investment are not adversely affected by the UK’s withdrawal from the EU, and can continue to operate with certainty.

To achieve this outcome, the Government’s strategy is twofold: through negotiations with the European Commission we will seek a close association with Euratom and to include Euratom in any implementation period negotiated as part of our wider exit discussions; and at the same time, to put in place all the necessary measures to ensure that the UK could operate as an independent and responsible nuclear state from day one.

Our strategy is therefore based on the following principles:

to aim for continuity with current relevant Euratom arrangements;

to ensure that the UK maintains its leading role in European nuclear research;

to ensure the nuclear industry in the UK has the necessary skilled workforce covering decommissioning, ongoing operation of existing facilities and new build projects; and

to ensure that on 29 March 2019 the UK has the necessary measures in place to ensure that the nuclear industry can continue to operate.

The Government have made good progress on separation issues in the last few months as part of phase one of negotiations with the EU. Negotiations have covered a set of legal and technical issues related to nuclear material and waste, and safeguards obligations and equipment. The next phase of discussions will focus on the UK’s future relationship with Euratom. We believe that it is of mutual benefit for both the UK and the EU to have a close association with Euratom and to ensure ​a future safeguards regime that will be equivalent in effectiveness and coverage to that currently provided by Euratom, including consideration of any potential role for Euratom in helping to establish the UK’s own domestic safeguards regime.

The UK’s specific objectives in respect of the future relationship are to seek:

a close association with the Euratom Research and Training Programme, including the Joint European Torus (JET) and the International Thermonuclear Experimental Reactor (ITER) projects;

continuity of open trade arrangements for nuclear goods and products to ensure the nuclear industry is able to continue to trade across EU borders without disruption; and

maintaining close and effective cooperation with Euratom on nuclear safety.

We understand the importance to businesses and communities, including those in the nuclear sector, of being able to access the workforce they need. Proposals for our future immigration system will be set out shortly and we will ensure that those businesses and communities, and Parliament have the opportunity to contribute their views before making any decisions about the future system.

Whatever the outcome of the negotiations with the EU, it is vital that Government pursue all options for providing certainty for the civil nuclear industry that it will be able to continue its operations, including that the UK has a safeguards regime that meets international standards by the end of March 2019 and that necessary international agreements are in place. Such elements are not dependent on the EU negotiations and the UK Government are well advanced in delivering this plan.

The UK is: establishing a legislative and regulatory framework for a domestic safeguards regime—the Nuclear Safeguards Bill will, subject to the will of Parliament, provide legal powers for the Secretary of State to establish a domestic regime which the Office for Nuclear Regulation will regulate; negotiating bilateral safeguards agreements with the International Atomic Energy Agency; and putting in place bilateral Nuclear Co-operation Agreements with key third countries.

As set out by the Prime Minister, the UK Government are proposing a time-limited implementation period where we continue to have access to one another’s markets on current terms and take part in existing security measures. This implementation period would cover Euratom too. The exact nature of the period will be subject to forthcoming negotiations including on the issues outlined in this statement.

As discussions with the EU move onto the important issue of the future relationship, I shall report back every three months about overall progress on Euratom, covering the EU negotiations and other important matters covered in this statement, by way of further written statements to keep Parliament updated.