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Government: help or hindrance?

What is the role of government when it comes to industry?

The UK engineering sectors tend to be fairly conflicted on this difficult question.

Indeed, if the general tenor of comments on The Engineer website are anything to go by politicians don’t know what they’re talking about,  government industrial policy – though occasionally well targeted – is  generally misdirected, and engineers should have a far greater say on the direction of industry.

Interestingly though, this doesn’t necessarily mean that readers believe government should stand back and let industry get on with it.

In fact, with recent developments in the nuclear sector reminding everyone of the stake that many largely state-owned foreign firms have in the UK’s industrial future – arguments for the renationalisation of key areas of industry have rarely been so well-received. The delighted reaction to our recent interview with UK manufacturer John Elliot – who effectively argues for state-ownership of industry - seems to bear this out.

The shape that government support should have was the discussion point at two events last week, first a panel discussion on Innovation at National Instrument’s annual NI Days conference – where a panel including Dick Elsy, CEO of high value high value manufacturing catapult and Dr Stephen Myers, director of accelerators and technology at CERN – examined the role government should play in innovation.

It was a fascinating debate. The catapult centres have been set up to exploit the near-term commercial potential of the UK’s research and unsurprisingly Elsy made the case for targeted investment in areas of economic promise.

There is far less certainty about the contribution that Cern’s Large Hadron Collider  - the world’s largest particle accelerator - will make to humanity. But Myers argued that by committing ourselves only to projects with immediate economic benefits we risk missing some of the really big prizes, and he pointed out that it is often the accidental discoveries: the epiphanies that arise during the course of scientific exploration that end up making the biggest contribution.

Government clearly has a role to play in setting priorities – and the widespread enthusiasm for the catapult centres is perhaps a sign that its taking the right approach. But Myers’ comments were a reminder that the short term economic priorities  which tend to dictate political policy  – don’t always represent the best long-term strategy .

The degree of government responsibility for addressing industry’s big issues was also on the agenda at last week’s launch of the Matchtech Confidence Index, an annual industry bellwether put together by one of the UK’s leading technical recruitment agencies.  

Based on a survey of over 1000 engineers the 2013 report is broadly more positive than last year’s survey, but it still makes some worrying observations.

76% of those who took part reported a lack of confidence in government’s action to encourage innovation, 63% believe the UK will cease to be a world leader in engineering in the future, and 78% felt that government is  not doing enough to attract new talent.

From addressing industry’s skills gap, to defining innovation strategy, the report places a lot of responsibility on government  to address some fairly fundamental issues.

But while we would certainly agree that government has a role to play – as a buyer, an investor and a champion for the industry  - we would also question whether industry is perhaps guilty of placing unreasonable expectations on the shoulders of our elected representatives.

Surely it’s industry’s responsibility to take the lead on the key issues it faces, to accurately communicate its strengths, weaknesses, and hopes for the future and to make a compelling case for government assistance in the areas that will help ensure future growth? Only then will we begin to get to grips with the disconnect between what industry wants, and what industry gets.

Readers' comments (11)

  • Government interference is destroying the NHS. Why shouldn't industry bear some of the pain? Sadly this government is incompetent and any involvement will be detrimental in any sector. Perhaps MPs should be held accountable like the rest of us?

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  • I may have missed it, but one conspicuous ommission from all these debates appears to be real encouragement of engineering entrepreneurship. The Catapult Centres obviously help a little in this respect but seem to be a little fixated on the outputs of university research.

    IMechE seems to be mostly interested in telling youth how great it is to be an Engineer (and nothing wrong with this of course) but there does not appear to be any real attempt to push the value of starting new engineering businesses. Without a seed we do not get a plant, either vegetable or industrial.

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  • Creating a position for an engineering advisor to the government would help greatly. The government need to reverse the decline of engineering in the UK. Engineering is very uncompetitive compared to other sectors and internationally salary-wise and so it struggles to recruit people.

    An interesting article in the telegraph yesterday mentions that over half of UK engineers are considering moving abroad. This is a remarkable change from previous years.

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  • We need an engineering campaign and a champion to promote manufacturing and win government support for encouraging entrepreneurs.

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  • Unfortunately Government are only puppets of their financial masters, big corporations, and they dictate policy and Government sell it to the populas.

    Here lies the major problem, Government don't have any real control and those with the real control are the corporations with the money.

    Industry has failed to invest in itself and corporations, including the EU have been allowed to dictate policy far too much. This subtle control has been designed and implemented over many years so organisations such as the EU can take over the UK and its industry, and dictate training. This is the real key here, dictatorship, and while the UK is suffering other EU member nations are having considerable sums of EU (our) monies pumped into their engineering industries.

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  • I agree with Jon Excel: the Engineering Industry needs to sell itself better in this country. Only recently did The Engineer draw attention to the British contribution to the Space Industry placing us second only to the USA in the value of business done. At a talk at Manchester University only a week after the Nobel Prize was awarded for work on Graphene the audience were surprised to hear that the world's biggest chip company is the British company ARM not the American company Intel. The success of British engineering in F1 racing is rarely mentioned. We just don't sell ourselves well. Politicians have too much short term and negative influence in my view.

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  • At least this government, unlike the previous one is actively trying to improve things-with mixed success- rather than deliberately sabotage the country. And as for state ownership of industry, you only need three characteristics to know how disastrous that was in the UK. One, you need to remember when we had millions doing nothing in the coal, steel and car industries sucking the life out of the economy the way the bloated public sector now does. Two, you need to be able to count to ten without moving your lips or using fingers. Three you need an IQ over ten.

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  • Perhaps Governments role should be to galvanise industry to get together, decide what it wants and then help to fund the outcomes. Part of the problem is well meaning civil servants who really don't understand business and manufacturing, and who seem to think that by running networks, making websites and building white elephants all will be well. Of-course industry needs to help itself, the problem is that it is not one big, cohesive entity. Trying to get many thousands of businesses to come up with 3 top priorities for action will need to be coordinated and focused. By the way, the idea of nationalising industry fills me with horror and despair. Anyone old enough to remember the 1970s may understand that.

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  • "Myers argued that by committing ourselves only to projects with immediate economic benefits we risk missing some of the really big prizes."

    Yes, but any governance (UK or EU) that ties itself to an ideological straitjacket that says - "Innovative engineering and IPR are not the province of the state." passes that responsibility on to the private sector, and they only invest in projects that promise quick returns. Essential R&D doesn't even get a look in, if the benefits aren't immediate, so radical proposals are killed off at the proof-of-concept stage.

    "76% . . reported a lack of confidence in government’s action to encourage innovation."

    Because the government's dogma precludes it from promoting innovation (ask David Willetts, or Lord Drayson before him, or Patricia Hewitt before him), especially the radical 'orphan' ideas that disrupt industry incumbents. The EMR are an ideological construct - a blind faith that 'the market' will somehow find a solution. Sorry, it's never gonna happen, yet EU state aid rules enshrine this idiocy.

    "It’s industry’s responsibility to take the lead on the key issues it faces."

    No it can't be, not if the "key issues" require an industry to change its product (innovation) or change its ways (to address externalities such as emissions).

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  • The last paragraph in your article makes me think that for example Energy Companies running to the government for direction on future energy technology requirements and with help from the tax payer in mind with subsidies when the reason for an increase in household energy tariffs is to pay for future energy technology requirements as set out by the EU where, finally my point is, if they do get subsidies from the government they get to keep some of the money in profits that was meant for new technology and well, I don't know, are profits being used to invest their business in other countries to make them even bigger globally, which is the business trend these days.

    Also on the future of Engineering, namely manufacturing, in the UK; I think we are headed for a green and pleasant land in the future and rely more on imports. Imports have contributed to a slow decline in manufacturing in the UK in the past decades.

    I was too young to understand the 1970's but I'd assume the workforce of these nationalised industries where mad over something much like the people are mad over what the government decides today. The 1970's strikes were a precursor to today's industrial climate where not a lot has survived and where we are continually hearing on TV and from government news articles that they need more entrepreneurs for the future well being of the UK, well why let industry decline for the bread and butter stuff we need as a country, if we still had most of it here it would certainly help balance the GDP from all the imported goods by selling in our home markets.....isn't it a case of "Better the Devil you Know"......but alas the government is tied up in EU regulations over protectionism after all.

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  • Government running businesses is a kiss of death - All Governments should do is get the economic climate right and provide minimal regulations and set the entrepreneurs in our society free.

    The problem with government interference can be summed up by the addition of useless over regulation from Westminster and Brussels

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