ALBAWABA – The government of the United Kingdom (UK) announced Friday they will be allocating $5.6 billion (£4.5 billion) to various UK manufacturing sectors, including cars and green industries, according to the Chancellor of the Exchequer Jeremy Hunt.
The government will invest £2 billion ($2.43 billion) in the automotive industry, £960 million ($1.16 billion) in clean energy and £975 million ($1.18 billion) in aerospace, the treasury said late Friday in an emailed statement, reported by Bloomberg.
However, the allocations will not be made available until 2025, following a general election that is widely expected to take place next year, the New York-based news agency confirmed.
Hunt is trying to boost the UK manufacturing sector, and the British economy overall, without stoking inflation, as he prepares a package of measures for his Autumn Statement on Wednesday.
If anything, this presents an opportunity for the Conservatives to make a dent in the Labour party’s 20-point lead on the polls ahead of the elections, slated for January 2025.
According to Bloomberg, Hunt’s hands are somewhat tied, with only about £15 billion ($18.19 billion) at his disposal from the get-go. While it is significantly higher than the record low of £6.5 billion ($7.89 billion) in March, it is still low by historic standards, the news agency reported.
The government is committed to supporting UK manufacturing - Shutterstock
To overcome this obstacle, the chancellor said the government will try to attract more private investment.
“Our £4.5 billion ($5.46 billion) of funding will leverage many times that from the private sector,” Hunt said in the statement about his plan to invest in the UK manufacturing sector. That, “in turn, will grow our economy, create more skilled, higher-paid jobs in new industries that will be built to last.”
The package also includes £520 million ($631.04 million) for life sciences, Bloomberg reported.
The cash for the automotive industries will support electric car manufacturers and their supply chain, and the funding for aerospace will help develop zero-carbon aircraft equipment, the UK Treasury said. The funding forms part of an ‘Advanced Manufacturing Plan’ to be published next week, according to the email.
Bloomberg reported last month that Hunt was considering a response to US President Joe Biden’s $369 billion package of green subsidies enshrined in his Inflation Reduction Act.
The government will also publish a battery strategy next week, setting out how it plans to achieve a competitive supply chain in that industry by 2030. In addition to launching a Hydrogen industry task force to maximize investment for UK manufacturing of hydrogen propulsion systems, the Treasury said.
