Over on Lib Dem Voice, and in the run up to the Spring Conference motion on manufacturing, William Hobhouse sets out the positive case for the Regional Growth Fund.
The Spring Conference will debate the motion on creating a strong manufacturing sector in a strong economy. In Vince Cable, the coalition government has a powerful voice for manufacturing. Significant progress is being made in building a more resilient, diverse and balanced economy. Lib Dems are also becoming confident in charting an interventionist industrial strategy that avoids the twin failures of laissez faire and state support for ailing companies – the two positions characterised by historic Conservative and Labour thinking.
The Conference motion says that government funds made available through the Regional Growth Fund (RGF) has led to the creation and/or safeguarding of over 550,000 jobs, many in the manufacturing sector, and £14.5bn of private investment.
The motion resolves to support a further round of funding through the RGF – this funding will encourage new investment in manufacturing, increase manufacturing capacity, and lead to further job creation and preservation, while ensuring a continued commitment to a geographically rebalanced economy.
To give one typical example – Holroyd Precision, a foreign owned engineering company in Greater Manchester, received £2.8 million from the first round of the RGF, a contribution towards building a new factory and R&D innovation centre in Britain. The company’s MD put it well: ‘This has enabled us to make further investments in additional staff, research and development projects, as well as securing the future of Holroyd Precision for many more years to come.’
The RGF should be seen as a long term and steady incentive for capacity building in UK manufacturing. It is supporting new investment in new production lines and general industrial capacity. It fits well with the Lib Dem success of increasing capital allowances from £25,000 to £250,000 for a two year period – another measure that encourages new investment.
Almost everything in manufacturing is long term. And, just as important, manufacturing is technical. Product development can take years, product lifetimes are long too, and investment is usually upfront. Government policy that takes a similarly long term view about British manufacturing will be successful. That’s why a Lib Dem commitment to fully funded future rounds of the RGF sends the right signal to UK, EU and international companies that here in Britain we are open for manufacturing business.
William Hobhouse is co-founder of the Liberal Democrat Campaign for Manufacturing and runs an industrial textile business in Rochdale