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6 Jan 2016


COMPANIES’ futures are being put at greater risk because the Government is washing its hands of industrial strategy, a business leader has warned.

Dr Stan Higgins, chief executive of North-East Process Industry Cluster (NEPIC), says ministers are causing “death by a thousand cuts” by making decisions without comprehension of their impact.

Dr Higgins, whose NEPIC organisation represents hundreds of companies in the petrochemical, chemical, biotechnology and pharmaceutical sectors, cited the failure of Redcar steel maker SSI UK as a clear example of how political uncertainty can affect business and society.

He also said higher energy costs, onerous environmental and employment regulations, and a lack of understanding over opportunities in science and technology are holding companies back.

He told The Northern Echo he said: “We seem to have lost the understanding that industry is a fundamentally important requirement to the well-being of society.

“It is surprising therefore that despite underpinning just about every human activity, it is of great concern such industries are not supported by a Government-owned integrated industrial strategy, as they are in other countries.

“It seems to me there has been a washing of hands of responsibility for industry strategy in Westminster.

“Political decisions are now made without understanding the potential impact on our fundamental process industries.

“In business, we now live in a world of extra risk where political uncertainty and the unforeseen circumstances arising from political decision making has become a real problem.

“The UK has had decades in which politicians have followed a philosophy that the market will determine the outcome for industry.

“If this is the best approach why is it we do not let the market determine what happens in the health service or transport, welfare provision and defence?”

Dr Higgins also said more must be done on science and technology, and urged the Government to look at new industries.

He added: “The growth in depth and breadth of scientific understanding has become exponential and the ability for non-scientific politicians and indeed civil servants to make decisions, on our behalf, about it has become a real problem.

“What has happened to steelmaking in the UK is just one manifestation of the issue.

“Some industries are dying a death of a thousand cuts; through higher energy costs, ever deeper environmental regulation and ever more onerous employment regulation.

“Perhaps just as importantly is the lack of understanding of the new opportunities science and technology can bring to the foundation industries.

“This also results in technologies invented here in the UK being nurtured and brought to life in other countries.

“The last underground coal pit operating in the UK has closed and the perception will be that Britain has no coal.

“In fact, I’ve heard senior politicians say this.

“Why is it then we have so many open cast coal mines?

“It is because the UK is awash with coal in huge deep seams that sometimes come close to the surface.

“But our pits have become globally uncompetitive.

“However, the Durham Coal Field is very deep and very wide.

“It is, however, accessible by investment into a technology known as underground coal gasification, a technology which is used all over the world, and has the potential to provide more energy from the Durham Coal Field than this country could use in 10,000 years.

“Furthermore, the return of any carbon dioxide produced back into the part of a mine from which the coal has been partially or wholly removed presents a real opportunity for the production of energy and materials that are essentially carbon emission free.

“Scientists and engineers in the North-East have been trying to get a pilot plant established here for five years.

“Any Government with industry, energy security and a deep understanding of science and technology would have already ensured this was done.

“From my perspective having industry at the heart of our Government, owning a truly integrated industrial strategy, would make the UK a more competitive location for manufacturing.”

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© Copyright. North East of England Process Industry Cluster (NEPIC) 2015