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3 months ago

Multi-Billion Boost for Sustainable Manufacturing

In a significant windfall for British manufacturing, the UK Government has unveiled a new £4.5 billion package of grants and loans. This funding, confirmed by HM Treasury, has been strategically allocated to support various manufacturing sub-sectors and the transition to a net-zero future.

There's an expectation that will be particularly affected by these measures, as the Government aims to empower businesses that will play a crucial role in the country’s long-term ambitions.

Breaking Down the New Funding

The £4.5 billion bundle is structured to target key manufacturing sub-sectors, focusing on those seen as integral to economic development and transitioning to a lower carbon economy. Notably, almost half of the total figure has been earmarked for the automotive industry to assist the push towards electric vehicles (EVs) with the impending ban on new petrol and diesel vehicles on the horizon.

Factory workers assembling partsManufacturing clean energy ‘components’ is another noteworthy beneficiary, with almost £1 million allocated to SMEs contributing to hydrogen, nuclear, wind and storage solutions. This investment is a positive sign of the Government's determination to accelerate the development and implementation of green technologies.

An important element of the funding package is the expansion of the 'Made Smarter' program. From 2025, the initiative will extend to all of England, with plans for further expansion across the rest of the UK from 2026. This program supports SMEs in adopting tech that enhances operational efficiency. For those in the manufacturing sector, this presents a valuable opportunity to embrace advancements and remain competitive in the evolving market.

Driving the Automotive Industry Forward

With £2 billion set aside for automotive companies, the funding aims to facilitate the transition to increased EV manufacturing. SMEs fitting into this supply chain can tap into this support and contribute to the UK's leadership. The upcoming battery strategy announcement should provide clarity and guidance for firms currently navigating the transition.

Launching Investment for Aerospace and Science

Aerospace manufacturing firms and ‘life sciences’ manufacturers should also benefit significantly, with £975 million and £520 million, respectively. These sectors play pivotal roles in the UK's modern industrial makeup, with anticipation that the new funding will support vital innovation and growth.

Reaction from the Industry and Parliament

Brigitte Amoruso, Senior Climate Change and Energy Specialist at Make UK, the Manufacturers' Association, emphasised the importance of this development.

She said: “This funding will undoubtedly help the manufacturing sector make progress towards achieving net-zero emissions. We’re prepared to work with the Government on the practicalities of this plan, including how to incorporate manufacturing supply chains. These chains have a key role in supplying components and services for clean energy in the future low-carbon economy.”

As the Government announced this funding boost, the Energy Security and Net-Zero Committee of MPs launched a Parliamentary inquiry. The goal of the inquiry is to maximise the role of British manufacturing in the global energy transition, which is an encouraging sign of the Government’s commitment to make a success of their plans.

Financial Alternatives or Extra Funding

News of fresh funding for manufacturers is a positive development for the industry. However, business finance is an alternative option if your business isn’t eligible for a grant or requires some additional investment.

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Sam White