BREXIT: Manufacturing body calls on government to support industry

In a pre-election manifesto trade body the EEF said the incoming government should listen to British manufacturers while it negotiates the country's exit from the EU, in order to build a “new industrial future”.

A significant portion of the manifesto relates to Brexit and the UK's negotiations to leave the EU. The EEF said the UK needed a “seamless” trade deal that included zero tariffs; the maintenance of preferential rules of origin; and minimal customs procedures. It wants employers to have access to EU workers and the ability to deploy UK workers around the union.

A clear roadmap for Brexit was needed, the EEF said.

“Any differences or divergences that emerge in the overall trading environment could add signifcant additional business costs, introduce uncertainty and could discourage companies from investing, trading or expanding in the UK,” said the manifesto.

The body called for increased funding for a number of projects, changes to tax rates and reform to immigration to support manufacturers.

“By driving forward a comprehensive industrial strategy [government] can lay the foundations for generations to come; it can put Britain at the forefront of the fourth industrial revolution, investing in digital technology and new innovation; it can create the right conditions for industry to thrive and invest. It can - and must - revolutionise our education system, to equip existing employees and a new generation with the skills and capabilities they need to help the economy grow,” EEF CEO Terry Sculoer said.

The EEF called for industry incentives such as an enhanced research and development (R&D) tax credit, a review of the capital allowance scheme for new technologies, and a removal of the business rates tax on plant and machinery. It also wants the government to build infrastructure for a low-carbon economy.

The body said the government should allocate employers work permits according to skills shortages, and introduce fiscal incentives that would help employees with long-term health conditions to return to work.

Although the apprenticeship levy, to fund 'digital accounts' from which employers can pay for training, was only introduced in April, the EEF said this should be reformed to give companies more flexibility.

The body also said government needed to work closely with companies to address industry-specific challenges, in order for businesses to engage “with clarity”.

In January the government launched a consultation on its new industrial strategy, which included proposals in line with the EEF's manifesto points such as additional investment in R&D. The consultation closed on 17 April and a report has not yet been issued summarising responses or the next stage.

The EEF manifesto follows recent news that the manufacturing sector is in good health with output at a three-year high. That news was greeted positively by manufacturing expert Nicole Livesey of Pinsent Masons, the law firm behind Out-Law.com, she said: “However, with the slow recovery of sterling and rising costs of raw materials, the sector must remain vigilant and on top of its game to ensure that this growth is maintained.”