A new report has been commissioned by the Department for Business and Trade (Formerly BEIS) to refresh the current evidence base and inform the development of new and existing policy options to support UK manufacturing supply chains.
Supply chains are in the news when we experience shortages like those of the personal protective equipment and other critical items during the COVID-19 pandemic. However, supply chains are not just about getting goods from the factory to the customer; nor are they only about problems. Supply chains are a vital part of the economy and well-functioning supply chain businesses drive economic growth.
In modern industries, manufacturing supply chains are critical enablers of innovation and value creation. Firms in the supply chain are a source of not only parts and components but also new technologies, knowledge-intensive services, and ideas. Policy interventions to revitalise manufacturing supply chains are needed not just to be better prepared for the next crisis but also to ensure the long-term prosperity of UK industries.
With the goals of both avoiding the supply chain failures that make the news and strengthening the overall health of supply chains that contribute to the country’s prosperity, policymakers face a complicated task. Governments around the world are increasingly paying attention and designing supply chain interventions to achieve specific policy outcomes, rather than just addressing short-term problems.
This report provides an overview of international supply chain interventions, providing a useful context to inform the design of future interventions in the UK.
The report makes the following policy recommendations:
- Supply chain interventions should be designed to address activities and capabilities in the supply chain that are critical to security of supply; job creation, increased domestic value added, improved trade balance; adoption and diffusion of innovation; sector and place competitiveness; and R&D commercialisation and technology scale-up.
- Build the evidence base on supply chain challenges and opportunities and assess whether the government capability to generate and disseminate this evidence can be improved.
- Formalise functions and responsibilities across government for identifying and addressing supply chain vulnerabilities of critical goods and sectors on an ongoing basis.
- Develop regional institutions to deliver supply chain support and strengthen support for SMEs.
- Work with industry to formulate sector-specific supplier development plans to exploit existing and emerging opportunities.
- Ensure public procurement decisions support the government’s strategic objectives for the health of the UK’s supply chains and economy.
Read the full report here.