Episode 176 - Governments New Industrial Strategy

This week we will be talking about the newly published governments Industrial Strategy. This episode content meets PC3 - Legal Framework & Processes of the Part 3 Criteria.

Resources from today's episode:

Websites:

• https://www.gov.uk/government/publications/industrial-strategy
• https://www.architecture.com/knowledge-and-resources/knowledge-landing-page/what-are-the-key-elements-for-architects-in-the-governments-industrial-strategy?utm_campaign=Member Update 260625&utm_content=A busy road in a city at night, with red buses and headlights.&utm_term=&utm_medium=email&utm_source=Adestra

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Transcript

Episode 176:

Hello and Welcome to the Part3 with me podcast. 

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I am your host Maria Skoutari and this week we will be talking about the newly published governments Industrial Strategy. Todays’ episode meets PC3 of the Part 3 Criteria.

In June 2025, the government published its 10 year Industrial Strategy document, which sets out how - over the next ten years - it plans to direct investment to accelerate UK business growth and where it will focus its economic support and partnership efforts. The strategy responds to a rapidly changing global environment—marked by technological revolutions, geopolitical volatility, and the urgent need for decarbonisation—by proposing a new, more active partnership between government, business, and workers. It aims to create higher living standards, boost productivity, and ensure the UK’s resilience and competitiveness on the world stage.

So, what is it all about:

As an integral part of the growth mission, the government’s main goals is to make it easier and simpler to do business in the UK, encouraging companies to make long-term investments with greater confidence and stability. This is intended to be tackled through:

• Tackling high industrial electricity costs
• Promoting free and fair trade through strong international partnerships 
• Strengthening economic security through uplift in defence spending, international collaboration, strategic investments in critical supply chains, technologies, and energy security, and support to businesses in understanding and mitigating risks.
• Expanding access to finance building on commercial expertise of the market 
• Driving innovation and data-driven growth
• Capitalising on the value of UK data by treating it as an economic asset 
• Enhancing skills and increase access to talent 
• Reducing regulatory burdens and speed innovation 
• Removing planning barriers including fast-tracking decisions on critical projects in the planning system
• Ensuring the tax system supports growth and high-growth sectors 

All of this will be tracked annually with clear targets and oversight from a new Industrial Strategy Advisory Council, making sure the strategy evolves as circumstances change.

Now in addition to this broad growth mission, the government is zooming in on eight high-potential sectors—each with tailored plans to unlock investment, innovation, and global competitiveness:

• Advanced Manufacturing – supporting automation, innovation, and commercialisation
• Creative Industries – investing in screen, music, games, and launching a Creative Content Exchange for licensing and sales of digital cultural assets
• Life Sciences – building the world’s most advanced AI-ready health data platform
• Clean Energy – delivering next-generation technologies for the green transition and powering the Clean Energy Superpower Mission
• Defence – combining national security with economic potential through exports and innovation
• Digital & Technologies – driving tech adoption across industries
• Increasing tech adoption and AI integration in the Professional and Business Services sector
• Financial Services by rebalancing to regulate for growth, cutting red tape for FinTech firms and driving forward initiatives to open up more private capital.

The key ones for the architectural profession are the sectors relating to Creative Industries and Professional and Business Services - I’ll come back to those shortly.

Now, in terms of the main content the strategy seeks to address, its structured around four main pillars: 

The first is to create an environment of ease, speed, and stability for business. This includes reducing electricity costs for manufacturing industries in the 8 sectors and foundational industries, accelerating grid connection timelines for major investment projects, expanding access to finance (notably through the £27.8 billion National Wealth Fund), cutting regulatory burdens by 25%, introducing a UK Carbon Border Adjustment Mechanism from January 2027 ensuring highly traded, carbon intensive products from overseas face a comparable carbon price to those produced in the UK, and maintaining a competitive corporate tax rate capped at 25%. The government also pledges major investments in innovation, capitalising on data, skills and talent pipelines, particularly in AI and engineering, and seeks to promote trade and international partnerships. It also seeks to remove planning barriers and accelerate infrastructure as reflected in the revised NPPF.

Now the second pillar focuses on supporting city regions and clusters. Recognising that national growth depends on targeted, sector-specific investments unlocking the potential of places across the UK strengthening connections between and within city regions and clusters ensuring that public investment in the nations and regions of the UK is given a fair hearing. The strategy, therefore, will launch a £600 million Strategic Sites Accelerator to bring forward investible sites, enhances Industrial Strategy Zones such as Freeports and Investment Zones, and establishes new AI Growth Zones.  As well as aiming to support city regions and clusters to attract private investment and renewing the UK’s partnership with Scotland, Wales and northern Ireland. There is also a £500 million Local Innovation Partnerships Fund to support local innovation ecosystems and strengthen transport and digital infrastructure.

Moving on to the third pillar, which seeks to transform frontier industries including advanced manufacturing, clean energy industries, creative industries, defence, digital technologies, financial services, life sciences and professional and business services. The government pledges to commit significant funding for research and development, such as £4.3 billion for Advanced Manufacturing and £1 billion for Clean Energy Supply Chains. Each IS-8 sector has a tailored plan with measurable goals for investment, job creation, and exports. Foundational industries—like steel, chemicals, and ports—are also supported to ensure robust supply chains and economic resilience. The governments 10-year plan is to make the UK the best place to start and scale in all eight sectors benefiting the whole economy.

And the fourth and final pillar expands on creating an enduring partnership with business. This involves establishing a permanent Industrial Strategy Council for oversight, reforming public procurement to favour innovation and local jobs, launching a Business Growth Service this summer 2025 to streamline government support, and improving digital access to government services for small and medium sized businesses. The Business Growth service will comprise a new website, which will act as a single online platform. The service aims to make essential information more accessible and to simplify the digital interface for businesses, as well as explore an extension of GOV.UK One Login to offer a more personalised, data-driven interface, saving businesses time and money. Additional reforms in this area include digitisation in local planning authorities and enhanced access to finance from the British Business Bank (BBB) and UK Export Finance (UKEF).

Overall, the strategy is designed as a living framework, not a one-off publication. Key metrics such as business investment, gross value added (GVA), productivity, employment, wages, and the number of new large homegrown businesses are tracked annually. The Industrial Strategy Advisory Council is responsible for monitoring progress, evaluating policy effectiveness, and ensuring the strategy adapts to changing circumstances. The approach is holistic, integrating place-based interventions, sectoral plans, and cross-government coordination.

Now how does the strategy impact the architectural sector and what does all this mean for architects:

The headlines from the Strategy that will specifically interest architects, includes the governments intentions to:

• Promote free and fair trade through strengthened international partnerships and new trade agreements;
• Reforming the skills and employment support system to build a pipeline of talent in priority sectors;
• Establishing a new Global Talent Taskforce to support high-growth sectors and attract skilled individuals to the UK;
• Removing planning barriers and accelerating decisions on nationally significant infrastructure projects;
• Supporting the growth of world-leading creative industry clusters across the UK;
• Strengthening connections within and between city regions and clusters to maximise innovation, academic collaboration, and growth;
• Driving increased tech adoption and AI integration across the Professional and Business Services sector;
• Attracting private capital and supporting co-investment with industry through targeted financial interventions;
• Using government procurement to strengthen domestic supply chains and support high-quality local jobs;
• Simplifying government processes to speed up investment decisions;
• Launching a new Business Growth Service to streamline SME access to support, tackle late payments, and reform procurement processes to make it easier for SMEs to secure government contracts;
• Introducing clear metrics to monitor and evaluate policy effectiveness of the Strategy.

Now, as mentioned earlier, the strategy makes reference to removing planning barriers and fast track application namely:

• Reducing the pre-application period for major infrastructure projects from two years to 12 months by eliminating excessive consultation requirements;
• Initiating a call for evidence to explore expanding permitted development rights, aiming to accelerate construction of national infrastructure like fixed and mobile networks and electricity networks;
• Aiming to make planning decisions on called-in applications within 13 weeks, ensuring faster approvals for high-priority projects like solar farms, data centres, housing, and transport, supported by a strategic planning framework;
• Improving connectivity by investing in new transfer infrastructure, with the allocation of funds and grants to help transport connectivity in smaller cities, towns, and rural areas;
• Allocating additional resource to local planning authorities (LPAs) by funding 300 new planning officers, allowing local flexibility in planning application fees, and accelerating digitalisation. User-friendly software like PlanX has been developed to speed up decisions, reducing application errors and planning-related calls by up to 60%;
• Implementing a Nature Restoration Fund, where developers can make a single payment to identify and meet their environmental obligations related to protected sites and species.

And to conclude todays episode with the sectors of most interest to architects Creative Industries and Professional and Business Services the government is planning:

For the Professional and Business Services sector, it aims to: Provide over £150million to fund five transformative programmes to encourage Professional and Business Services (PBS) innovation and technology adoption. One of these will be the creation of five new PBS Hubs in “high potential” city regions. Regional practices can expect to see Hubs launch in Liverpool City Region, Greater Manchester, West Yorkshire, the West Midlands, and the Edinburgh-Glasgow Central Belt.

Each Hub will be tailored to support both national and local Professional and Business Services priorities, including the adoption of digital technology and AI. There will be a complementary national AI Skills Hub. The first new technology adoption programme will be a pilot in the North of England. The government is working with regulators to support the development of digital and regulatory “sandboxes” – which are closed development testing environments – that will support collaboration between regulators, software developers and technology providers, and the first of these will focus on property, the sector identified as having a particular readiness for innovation. The initiative will launch as PropTech. The government sees PropTech having the potential to “transform the planning, housing, land, and infrastructure markets, and play a pivotal role in improving the way real estate is developed, managed, and transacted, increasing transparency, efficiency, and productivity.”

Property has also been identified as the testing ground for a Smart Data programme for Professional and Business Services, where consumer data would be shared between Professional and Business Services firms across the sector, with the early focus appearing to be on house purchase and conveyancing, although the plan says local authorities and housing providers will be involved. The sector plan reminds everyone that the UK and the EU recently agreed to establish dialogues on Recognition of Professional Qualifications (RPQ) and short-term business mobility. It specifically refers to the Architects Registration Board as an organisation that can expect to get government support to help negotiate further RPQ agreements, suggesting that a return to a mutual recognition agreement with the EU is at least on the agenda.

For Creative Industries: The promise of increased business investment alongside support for innovation, skills development, access to finance, exports and regional growth. The Department for Culture, Media and Sport will more than double the funding for Creative Industries by 2035. While the Professional and Business Services sector is to get more investment-focused on “Hubs”, the government wants to see investment in this area directed particularly at “Creative Clusters”, which are seen as the best locations for collaborative Research&Development efforts. The six Mayoral Strategic Authorities, for instance, will be given resources to catalyse business investment in identified clusters. Architects can look out for a new Creative Industries Research&Development strategy later this year, which will come with revised guidance on Research&Development tax relief, particularly where Research&Development can be classed as interdisciplinary innovation. Within this sector, the government also says it will increase the number of creative trade missions and markets accessed, with more funding to boost exports across major markets in the EU and the United States and fast-growing markets such as the Gulf and Asia-Pacific.

So to conclude, the UK’s Industrial Strategy represents a decisive shift towards a more strategic, interventionist, and partnership-driven approach to economic policy. By focusing on high-potential sectors, regional growth, innovation, and resilience, the strategy aims to position the UK as a global leader in the industries of the future. It seeks to deliver higher living standards, greater economic security, and sustainable prosperity for communities across the country, ensuring that the benefits of growth are widely shared and that the UK remains competitive in a challenging global landscape.

To sum up what I discussed today:

• The UK’s new 10-year Industrial Strategy aims to boost growth, productivity, and resilience by forging a stronger partnership between government, business, and workers.
• The strategy focuses on eight high-growth sectors—including Advanced Manufacturing, Creative Industries, Life Sciences, Clean Energy, Defence, Digital and Technologies, Professional and Business Services and Financial Services.
• It will be built based on four pillars—making it easier to do business, investing in regional growth, transforming high-potential sectors, and forging a lasting partnership with industry—all designed to drive innovation, boost productivity, and ensure the UK’s long-term economic resilience and competitiveness.
• The new Industrial Strategy will provide a number of benefits for architects and the industry, from streamlined planning, greater access to finance, support for international trade, and new initiatives to drive digital and creative sector growth.