Industrial Strategy A Missed Opportunity Which Will ‘Leave Behind’ Swathes Of UK
More than 7,000 British businesses are set to see their electricity bills slashed by up to 25% from 2027, as the Government unveils a new Industrial Strategy today [Monday 23 June].
The modern Industrial Strategy sets out a ten-year plan to boost investment, create good skilled jobs and make Britain the best place to do business by tackling two of the biggest barriers facing UK industry – high electricity prices and long waits for grid connections.
British manufacturers currently pay some of the highest electricity prices in the developed world while businesses looking to expand or modernise have faced delays when it comes to connecting to the grid.
From 2027, the new British Industrial Competitiveness Scheme will reduce electricity costs by up to £40 per megawatt hour for over 7,000 electricity-intensive businesses.
These firms, which support over 300,000 skilled jobs, will be exempt from paying levies such as the Renewables Obligation, Feed-in Tariffs and the Capacity Market — helping level the playing field and make them more internationally competitive. Eligibility and further details on the exemptions will be determined following consultation, which will be launched shortly.
The government is also increasing support for the most energy-intensive firms by covering more of the electricity network charges they normally have to pay through the British Industry Supercharger. These businesses currently get a 60% discount on those charges, but from 2026, that will increase to 90%. This means their electricity bills will go down, helping them stay competitive, protect jobs, and invest in the future.
These reforms complement the government’s long-term mission for clean power, which is the only way to bring down bills for good by ending the UK’s dependency on volatile fossil fuel markets.
To ensure businesses can grow and hire without delay, the government will also deliver a new Connections Accelerator Service to streamline grid access for major investment projects — including prioritising those that create high-quality jobs and deliver significant economic benefits.
The Industrial Strategy is a 10-year plan to promote business investment and growth and make it quicker, easier and cheaper to do business in the UK, giving businesses the confidence to invest and create 1.1 million good, well-paid jobs in thriving industries – delivering on this government’s Plan for Change.
Prime Minister Keir Starmer said: “This Industrial Strategy marks a turning point for Britain’s economy and a clear break from the short-termism and sticking plasters of the past.”
“In an era of global economic instability, it delivers the long term certainty and direction British businesses need to invest, innovate and create good jobs that put more money in people’s pockets as part of the plan for change.”
“This is how we power Britain’s future – by backing the sectors where we lead, removing the barriers that hold us back, and setting out a clear path to build a stronger economy that works for working people. Our message is clear – Britain is back and open for business.”
Missed Opportunity
Kate Nicholls, Chief Executive of UKHospitality, said: “This is not an industrial strategy that will deliver growth equally across the UK. In fact, by ignoring 70% of the economy it is at odds with the Government’s ambition to create jobs and help people into work.”
“Once again, growth will be distributed unevenly and centred around small industrial clusters that have high barriers to access – hardly a recipe for driving social mobility.”
“We were desperate to see a plan for hospitality and the high street, which together employs over 7 million people. We were disappointed.”
“How can national renewal be properly delivered if 70% of the economy is excluded from the Government’s flagship plan for growth”?
“Critical foundational sectors of the economy, like hospitality, leisure and tourism, are central to creating jobs, yet overlooked. This is the same approach which led to this year’s employer NICs changes hitting part-time, flexible and accessible jobs hardest, while protecting jobs in the industrial strategy.”
“The Social Productivity Index clearly demonstrates that hospitality is the top performing sector providing routes into work, regardless of background, education, or upbringing – qualities the Government should be backing.”
“Instead, this strategy will once again leave behind the towns, coastal communities and rural areas which are most in need of a real strategy for growth.”
The Industrial Strategy also sets out how energy bills will be reduced significantly for certain sectors, but not hospitality.”
“Lowering energy bills for certain sectors is clear recognition from the Government that the energy market is broken and a major barrier to investment,” Kate said.
“We now need a clear roadmap and timeline for when the Government will fix the energy market for the rest of the economy.
“The CMA found in 2016 that SMEs were paying 18% too much for energy – an overpayment of £500m per year. Nine years on, that has only got worse, and a recent investigation by Ofgem found that hospitality businesses were specifically being treated unfairly, and even blacklisted, by some suppliers.
“Given the Government has now accepted that the energy market is a barrier to growth, I hope they move swiftly to resolve the energy challenges that have plagued hospitality businesses for decades.”