Written by Andrew Cronin, Aerospace Policy Adviser
In the wake of the economic challenges facing the UK as set out by the Chancellor of the Exchequer in July, it has been welcome relief to hear affirmation of the Government’s commitments to our sectors, both now and into the future. The Prime Minister’s recent attendance at the Farnborough International Airshow 2024 (FIA 2024), flanked by the Secretaries of State for Transport; Science, Innovation and Technology; Defence; Business and Trade; and Scotland respectively, was in itself a clear signal of support. Our sectors not only add significant value to the UK economy (£38.2bn, in 2023) but bring wider benefits through highly skilled jobs and helping to achieve the UK’s Net Zero targets.
The Prime Minister has continued to actively engage with our sectors to address critical issues such as skill shortages and other barriers to industry growth. During his opening address at Farnborough International Airshow, he announced the creation of Skills England, a public body aimed at bridging the national skills gap. This initiative is designed to enhance training and strengthen the relationship between businesses and the education system, seeking to promote STEM education and provide young people with appropriate training and opportunities in their local communities. We look forward to working with the new body to promote the opportunities in our sectors currently enjoyed by 427,500 people across the UK!
Furthermore, the Government is expected to maintain strong financial incentives such as R&D tax credits and capital support to help encourage investment. On an immediate tangible level, FIA 2024 featured significant announcements from the Government, including a £6.5 billion partnership for complex weapons systems and successful trials of advanced laser weapons. These developments underscore the UK’s commitment to maintaining a leading global role in these areas.
The Chancellor of the Exchequer has been actively pursuing a strategy to boost prosperity through a comprehensive economic growth agenda. The establishment of a National Wealth Fund, intended to attract significant private investment into new and growing green industries, will include aerospace. This fund is designed to unlock substantial private sector investment by providing initial public funding of £7.3 billion, with the goal of leveraging an additional £3 of private investment for every £1 of public investment.
Planning reforms are also welcome, streamlining processes and removing bureaucratic hurdles previously delaying major infrastructure projects. While these reforms aim to accelerate development in various sectors, including energy and housing, they should indirectly benefit our sectors by improving overall economic conditions and infrastructure.
Moreover, the Chancellor’s commitment to green energy may have a positive impact on energy costs, particularly as the industry is already working on sustainable and energy-efficient technologies
Internationally, the Government has also been working to enhance trade ties, particularly with the EU, which could open new opportunities for our sectors. Plans include revising parts of previous Brexit agreements to ease trade barriers and improve mutual recognition of qualifications, which can benefit aerospace companies operating across borders, as well as a potential UK-EU security pact (as called for in our 2024 manifesto…) These initiatives, combined with a strong emphasis on political stability and attracting global investment, signal a proactive approach to supporting and growing our industries.
Specific government support for long-term innovation and maintaining the momentum of ongoing projects is the news we are waiting for. ADS have emphasised the need for continuous funding and support for initiatives such as the Aerospace Technology Institute (ATI), Advanced Aviation Mobility, and the Future Flight Challenge, which are crucial for sustainable aviation developments like clean aviation fuel and hydrogen power. The recently announced Sustainable Aviation Fuel (SAF) Bill, to encourage the production and use of SAF, is a welcome development providing confidence for investors
Other announced legislation will also have an impact on our sectors. The Worker’s Rights Bill aims to implement Labour’s Make Work Pay proposals and deliver a new Fair Work Agency to enforce these new rights. The Crime and Policing Bill will introduce new nationwide standards for police procurement, as part of a wider efficiency programme, and industry will be keen to contribute to this work. The Terrorism (Protection of Premises) Bill, or “Martyn’s Law” will be introduced during this Parliament and will mandate those responsible for certain premises and events to consider terrorist risk and how they would respond to an attack.
ADS will continue to support our members and the Government on realising these initiatives in a favourable light, as well as working together to resolve some of the outstanding challenges. This will include contributing and offering sound expert advice to the upcoming Industrial Strategy and the formation of its associated Industrial Strategy Council; the Strategic Defence Review;, and the Budget on 30 October. Look out for our updates in the coming months.
But for now, one month on from the election… have a great summer and remember how great our sectors are when you next jet off to your holidays!
