Theresa May's post-Brexit industrial strategy ducks tough decisions | Nils Pratley

The government’s long list of good intentions lacks a clear sense of which sectors should get priority

Hurrah, the UK will embark on its post-Brexit adventure with an industrial strategy, or at least a government that is prepared to use the term without embarrassment. What’s more, the business secretary, Greg Clark, hit some of the right notes in his introduction to the green paper.

The goal is not to pick winners, which would be to repeat the mistakes of the 1970s. Nor is it to protect the position of incumbents. It’s about “creating the right conditions for new and growing enterprises to thrive”. Few could disagree with the sentiment, or the eagerness to see the benefits of self-improvement spread more evenly across the nation.

Jolly good, but defining the ambition and describing past errors is the easy bit. It would be hard to conclude that the government’s thinking amounts to a clear-headed plan that is ready to be put into action. Many tough decisions were ducked in the green paper, or left hanging in the air.

Should the steel industry celebrate a “strategic approach” to procurement? Talk of mimicking Crossrail’s consideration of “social and economic factors” could suggest that British steel will be preferred in mega-projects like HS2.

But the document didn’t say so explicitly. Many of the passages on procurements were about stirring innovation and encouraging small businesses. Steel may not be as exciting as life sciences and clean cars, but is it inside or outside the strategic tent? The UK Steel lobbying group was right to reflect that “much still needs to be done” to agree one of the vaunted “sector deals” with government.

Or look at digital infrastructure, where the UK is ahead of major competitors on fast broadband but woefully behind the likes of Spain, South Korea and even Turkey on ultrafast capacity, the digital-to-the-premises (DTTP) variety.

Does Clark agree with Vodafone that BT’s performance in delivering DTTP is “a national embarrassment”? Or does he think regulator Ofcom’s attempt to stir investment by opening up access to BT’s ducts and poles will suffice?

Those questions lie at the heart of one critical debate about the UK’s digital future, but it’s not addressed. Instead, as in many areas, the green paper merely repeated commitments that have been made already – in this case the £740m going to support the roll-out of fibre broadband and 5G mobile technology. One suspects a serious government-backed commitment to DTTP would be counted in the billions or involve breaking up BT. In other words, the subject is too tricky for this document.

Some industrialists will find to much to cheer, notably the emphasis on reducing energy costs (though it remains a mystery how that squares with the grotesquely expensive Hinkley Point C nuclear power station). Overall, though, one is left with a sense that the green paper amounts to a long list of good intentions without a clear sense of which should be preferred in a world of finite financial resources.

Are we going down the American route (led by procurement and universities) or the German (with its emphasis on research and development) or the French (build some grands projets)? There were elements of all three. That may be a good thing, or it may be a muddle. The white paper needs to be sharper.

Sainsbury’s should take the heat over boss’s barn

Chairman of Sainsbury’s, David Tyler.
Chairman of Sainsbury’s, David Tyler. Photograph: Empics Sport

If you were a shareholder in a FTSE 100 company, would you expect to be told that your chairman had been censured by the board after an internal investigation? Would you want to know there had been “material breaches” of policies covering conflicts of interest? The answer to both questions is surely yes. The chairman is supposed to be a guardian of good behaviour. If he or she has messed up – intentionally or not – it’s important to say.

The tale of David Tyler, the Sainsbury’s chairman, and his barn conversion was told in Monday’s paper. In short: Tyler used one of Sainsbury’s green energy and engineering experts to inspect his plans to install underfloor heating at his home in East Sussex. One of the supermarket group’s building contractors then developed an action plan for free; and two other Sainsbury’s suppliers were contacted for specialist advice.

Tyler then contacted Sainsbury’s company secretary to arrange compensation for use of employees’ time. He ended up paying £5,000 to charity and did not benefit financially. But the resulting investigation, conducted by two non-executive directors, concluded that “he received (paid for) services from an expert supplier due to his position that he would otherwise not have been able to”. Thus the official warning.

It’s not the biggest scandal in the world, and Tyler’s failure to follow the rules was accepted as unintentional. But the intriguing detail is that it all happened in 2013. Sainsbury’s didn’t think it worth mentioning to shareholders, even in the years when its annual report scrupulously addressed the motor-racing sponsorship deals that some suppliers gave to the son of Justin King, chief executive at the time. That looks like double standards.

Better late than never, Sainsbury’s could correct its oversight in this year’s annual report, lest anyone should think the publication, like Tyler’s country pad, is full of hot air.


Nils Pratley

The GuardianTramp

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