The publication of the Industrial Strategy and the five sector plans published alongside it is an important step along the path to resetting and refocusing the UK’s approach to investment and growth.
During the lead up to its publication, TheCityUK has engaged closely with the Department for Business and Trade.
While the Strategy highlights the nation’s strengths in research and innovation, free trade and attractiveness to global talent and capital, it recognises that a ‘business-as-usual’ approach will not be enough to ensure the UK succeeds in an uncertain world. It is therefore good to see the UK's legal, accountancy, and consulting services recognised as jewels in the nation's crown and significant export drivers for all parts of the UK.
As expected, the Strategy places strong emphasis on place and the role of devolved leaders in regions and nations in driving growth. This reflects our long-standing work in this area, and the much-quoted fact that two thirds of people working in our industry are based outside of London, with 47% of industry exports and over half of the industry’s Gross Value Added (GVA) also generated outside of London.
However, the real determinant of success will be implementation on the ground. In particular, the ability to improve access to capital and leverage private sector funding. This is both a supply and demand challenge: there is significant capital available in the UK, but we need to provide a matching number of investable opportunities across the country.
Enhanced funding and a sharpened focus for the British Business Bank will help, particularly in defence. The creation of a Strategic Investment Opportunities Unit in the Office for Investment is the first critical step in the proposal we've been pushing for to enable more genuine opportunities to be presented to investors in an effective way. Making this work properly will require critical private sector input and we look forward to working with Office for Investment colleagues, alongside our members, to drive this forward. Other practical steps, such as a to move to an integrated funding settlement for the new metro mayors, will help to drive real investment in the everyday economy.
It was also encouraging to see our policy positions reflected in other key areas. In our Industrial Strategy submission, we called on the government to take steps to reform and improve the planning system, recognising that this is a key barrier to private sector investment in infrastructure and other key projects. Therefore, the government’s commitment to reforming the planning framework, thus providing greater certainty, confidence and stability to investors, is a welcome step forward.
While the Financial Services Growth Plan won’t be published until July, the Professional and Business Services Plan, already launched, recognises that the sector can play a critical role in helping businesses of all kinds to become more productive and resilient.
UK legal services contributed £42.6bn to the UK economy with a trade surplus of £7.4bn in 2024. The rule of law, English law as a medium for contracts, the quality of UK legal advice, and our world-leading arbitration capability are strengths to build on. Leveraging technology to grow the sector as a valuable exporter implies pushing for greater mutual recognition of professional qualifications and access to markets currently closed by non-tariff barriers in our trade agreements.
Our accountancy, audit, and tax sector, from the "Big 4" to local and regional SME firms, contributes £33bn to the UK economy, while management consultants contribute £46.8bn of exports. They are crucial components of the UK's status as the world's leading exporter of financial and related professional services. The acknowledgment of their contribution and the announcement of actions to strengthen the professions are welcome.
The UK is largely a service-led economy. Growth in services supports growth in manufacturing and vice versa. The government now needs to use every tool at its disposal - through the Industrial Strategy, the upcoming Trade Strategy, policy, tax, and regulatory reform - to deliver growth. Businesses and providers of capital have been waiting for the starting gun to be fired and are encouraged by the government's willingness to listen and engage. Developing the Industrial Strategy narrative has been a useful process, but the focus must now be on measurable delivery. The financial and related professional services industry is ready to play its part.
