Getting Industrial Strategy Right

Labour has one chance to solve the execution problem…

Today is the deadline for responses to the Labour government’s Industrial Strategy Green Paper. Entitled Invest 2035, it is an outline of the approach the government tends to take in pursuit of its mission to deliver the highest GDP growth in the G7 by 2029. It designates Defence as one of eight priority areas for state intervention.

In this edition of Conflict & Democracy I will outline a critical response to Invest 2035, in particular what the Department for Business and Trade calls its “Theory of Change”. I will use Defence as a case study to make some more general points about execution challenge.

What’s good about Invest 2035?

There is a lot to commend in Invest 2035:

• It recognises the need for state co-ordination of the economy in order to achieve the high growth.
• It sees city-regions as key elements of a successful state direction regime.
• It understands that “market inefficiencies” are preventing the reallocation of capital and labour from low to high value sectors.
• It proposes “temporary government catalytic support” where the private sector responds too slowly to growth opportunities. This…